/raid1/www/Hosts/bankrupt/TCR_Public/250214.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, February 14, 2025, Vol. 29, No. 44
Headlines
18222 YORBA: Files Chapter 11 Bankruptcy in California
560 SEVENTH AVENUE: Unsecureds Will Get 17% of Claims in Plan
A GRANDE PROMOTION: Unsecureds to Split $135K over 45 Months
AIR INDUSTRIES: Michael Taglich Holds 18% Equity Stake
AIR INDUSTRIES: Repays Over $1 Million in Subordinated Debt
AIR INDUSTRIES: Robert Taglich Holds 12.5% Equity Stake
ALGORHYTHM HOLDINGS: Ionic Ventures Holds 9.9% Stake as of Dec. 31
AMERICAN RESOURCES: AIC Becomes CGRA Subsidiary in Share Exchange
AMERICAN TIRE: Court Approves Asset Sale to Lender-Backed Buyer
AMTECH SYSTEMS: Swings to $312,000 Net Income in Q1 Fiscal 2025
ANGIE'S TRANSPORTATION: Gets Final OK to Use BMO's Cash Collateral
ANGIE'S TRANSPORTATION: Gets OK to Use Daimler's Cash Collateral
APPLIED ENERGETICS: Raises $1.2M in Stock Sale, Pre-Funded Warrants
ARTIFICIAL INTELLIGENCE: To Deploy ROSA in Urban Waterfront Dist.
AVINGER INC: Shareholders OK Assignment and Dissolution Plan
B. RILEY FINANCIAL: BlackRock Reports 5.1% Equity Stake
BALLY'S CORP: S&P Affirms 'B-' ICR, Outlook Stable
BELLEVUE HOSPITAL: Court OKs $1.5M DIP Loan, Cash Collateral Access
BENEDICTINE UNIVERSITY: S&P Lowers Revenue Bonds Rating to 'BB'
BIOXCEL THERAPEUTICS: To Execute 1-for-16 Reverse Stock Split
BLUM HOLDINGS: Signs LOI to Acquire NorCal Cannabis Dispensary
BM318 LLC: Court Tosses President's Appeal of Receivership Order
BULA DEVELOPMENTS: Court Orders Transfer of Mora's Chapter 13 Case
BYJU'S ALPHA: Procurement Biz Halts $533MM Debt Fight Disclosure
C-BOND SYSTEMS: Barry Edelstein Steps Down as Director
C-BOND SYSTEMS: Transfers Assets to Badcer Ops in Debt Settlement
CALIFORNIA QSR: Unsecureds Will Get $788 per Month for 60 Months
CALIFORNIA RESOURCES: Fitch Affirms B+ LongTerm IDR, Outlook Stable
CAMPBELL FAMILY: Seeks to Use Cash Collateral Until March 31
CAPSTONE COMPANIES: Amends $485K Loan Agreement With Coppermine
CARVANA CO: BlackRock Reports 5.7% Equity Stake as of Dec. 31
CATHETER PRECISION: Grants Incentive Stock Options to Executives
CCA CONSTRUCTION: BML Properties Seeks Appointment of Examiner
CELSIUS NETWORK: Ionic Shareholders File Lawsuit for Board Docs
CENTRAL HOUSEWARES: Gets Interim OK to Use Cash Collateral
CHARTER COMMUNICATIONS: Fitch Affirms 'BB+' LongTerm IDR
CHRYSSOULA ARSENIS: Court Tosses Foreclosure Case v. Blue Foundry
COGENTRIX FINANCE: S&P Assigns Prelim BB- (sf) Rating on New Debts
COLIANT SOLUTIONS: Case Summary & 20 Largest Unsecured Creditors
COMMSCOPE HOLDING: Completes $2.1B Sale of OWN and DAS Businesses
COMMSCOPE HOLDING: S&P Upgrades ICR to 'CCC+', Outlook Stable
COMPAC USA: Brayton & Shraiberg Advise Silicosis Claimants Group
CONROE CORRAL: Files Chapter 11 Bankruptcy in Texas
CORAL POINTE: Unsecureds Will Get $250 per Month for 36 Months
CRYSTAL PACKAGING: To Sell Business Inventory for $5MM
EARTH SCIENCE: Buys Back Over 17.4MM Common Shares as of Jan. 31
EARTH SCIENCE: Inks Deal to Acquire 80% of Magnefuse, Alicat
EARTH SCIENCE: Inks Deal to Acquire Two Florida Firms for $400K
EMMAUS LIFE: Seah Lim Holds 6.5% Stake
EMX ROYALTY: Board Member Wright Confirmed as U.S. Energy Secretary
ENTRUST ENERGY: Loses Summary Judgment Bid in Shell Energy Dispute
ENVERIC BIOSCIENCES: Orca Capital Holds 4.9% Equity Stake
FIREFLY STORE: Unsecureds Will Get 75% of Claims in Plan
FRANCHISE GROUP: Court Denies Request to Employ Willkie Farr
FRANCHISE GROUP: Paul Hastings & Landis Revise Rule 2019 Statement
FRANCHISE GROUP: Updates Unsecured Claims Details; Amends Plan
FREE SPEECH: Sandy Hook Families Accuse Alex Jones of Ambush Appeal
FTX TRADING: Struggling to Serve Binance With Chapter 11 Lawsuit
FULCRUM BIOENERGY: Unsecureds' Recovery "Unknown" in Plan
GENAPSYS INC: Unable to Retrieve Certain Docs From Paul Hastings
GIST ENTITIES: Unsecureds Will Get 10% of Claims over 60 Months
H & H FAST: Unsecureds Will Get 36.3% of Claims over 48 Months
HDTSOKANOS LLC: Files Chapter 11 Bankruptcy in New York
HEALTHLYNKED CORP: Shares Strategic Vision in Shareholder Letter
HELIUS MEDICAL: Faces Nasdaq Delisting Threat, Can Appeal Decision
HOP-HEDZ INC: To Sell Tampa Property for $2.8MM
J. HOWELL: Seeks to Use Cash Collateral
JORIKI TOPCO: Obtains Ontario Court's CCAA Initial Stay Order
KAL FREIGHT: Creditors Seek Appointment of Examiner
KRT INC: Seeks Chapter 11 Bankruptcy Protection in Wyoming
LUMEN TECHNOLOGIES: Reports Full Year 2024 Net Loss of $55-Mil.
LUMIO HOLDINGS: Updates Liquidating Plan Disclosures
M3B SFR LLC: Seeks Chapter 11 Bankruptcy Protection in Georgia
M4B SFR LLC: Case Summary & Eight Unsecured Creditors
MADISON 33: Seeks to Use $27,500 in Cash Collateral
MERCURITY FINTECH: Officially Joins Russell Microcap Index
MERIDIAN WEIGHT: Court Directs U.S. Trustee to Appoint PCO
MIDWEST MOBILE: U.S. Trustee Appoints Amanda Wilwert as PCO
MILLENKAMP CATTLE: Unsecureds to Recover Up to 100% in Toogle Plan
MIRACLE RESTAURANT: Amends Unsecured Claims Pay Details
MONDEE HOLDINGS: Tuesday Investor Seeks Appointment of Examiner
NEUROONE MEDICAL: Merchant Adventure Fund Holds 13.6% Stake
NEUROONE MEDICAL: Regains Compliance With Nasdaq Listing Standards
NEWS DIRECT: Court Extends Cash Collateral Access to March 7
NOVABAY PHARMACEUTICALS: Stockholders Reject Liquidation Plan
OCEAN POWER: Secures $2 Million PowerBuoy Orders in Latin America
OCUGEN INC: State Street Corp. Holds 2% Equity Stake
OMEGA THERAPEUTICS: Seeks Chapter 11 Bankruptcy w/ Over $140MM Debt
OUTFRONT MEDIA: Industry Veteran Nick Brien Named Interim CEO
PAN AM DENTAL: Files Emergency Bid to Use Cash Collateral
PANZER BUILDING: Unsecureds Will Get 13% of Claims in Plan
PASKEY INC: To Sell Heavy Equipment at Auction
PHVC4 HOMES: To Sell 23-Single Family Homes for $4.1MM
PINNACLE FOODS: Unsecureds Will Get $1,248 per Month for 60 Months
PRAIRIE EYE: Case Summary & 20 Largest Unsecured Creditors
PROMEDICA HEALTHCARE: S&P Affirms 'BB' Long-Term Bond Rating
PROSPECT MEDICAL: Conn. AG Opposes Hospital Operator's Plunder
PROSPECT MEDICAL: Seeks to Sell Medical Facilities in Private Sale
PROVISION BREAD: Amends Unsecured Claims Pay Details
R & R TRAILERS: Files Subchapter V Bankruptcy in Michigan
REED'S INC: Unveils Leadership Changes, Appoints CFO & VP of Ops.
REEVA DINING: Amends Plan to Include SBA Secured Claim Pay
RIC (LAVERNIA): $950K New Value Contribution to Fund Plan
ROGERS COMMUNICATIONS: Fitch Rates New USD & CAD Sub. Notes 'BB'
SECRETARIAT ADVISORS: S&P Assigns 'B-' ICR, Outlook Stable
SILVERGATE CAPITAL: Court OKs Appointment of Wickouski as Examiner
SOLDIER OPERATING: Seeks to Sell Oil & Gas Property to Rusk Energy
SONOMA PHARMACEUTICALS: Reports Net Loss of $928K for Q3 2024
SOUTH REGENCY: Seeks Chapter 11 Bankruptcy Protection in Kansas
SPI ENERGY: Director Maurice Ngai Resigns, Cites Cash Flow Concerns
SPI ENERGY: Director Resigns Over Cash Flow and Reporting Issues
SPIRIT AIRLINES: Moves Forward with Chapter 11 Plan Confirmation
SPLASH BEVERAGE: Signs LOI to Acquire Western Son Vodka
SPLASHLIGHT HOLDING: Case Summary & Eight Unsecured Creditors
SRAM LLC: S&P Affirms 'BB-' Issuer Credit Rating, Outlook Stable
SWAN PIZZA: Updates Unsecured Claims Details; Amends Plan
SWITCHBACK COFFEE: Updates SBA Secured Claim; Files Amended Plan
TALEN ENERGY: Wins Bid to Reclassify GE's Claims as Unsecured
TERVIS TUMBLER: Emerges From Bankruptcy With Debt Resolved
TEXAS OILWELL: Seeks Subchapter V Bankruptcy Protection in Texas
THINK GOODNESS: Voluntary Chapter 11 Case Summary
TIME OUT PROPERTIES: Baker Donelson Advises USBEF & Deere Parties
TONIX PHARMACEUTICALS: Fogarty Named First Chief Technology Officer
TREES CORP: To Acquire Chronic Therapy Dispensary for $1.75M
TRINITY PLACE: Inks Stock Purchase Deal With Steel IP Investments
TYCO GROUP: Unsecureds Owed $241.9K Will Get 3% of Claims in Plan
VALARIS PLC: Bardwell's Bid for Plan Discharge, Injunction Denied
VISTRA ZERO: Fitch Affirms 'BB' Rating on 2031 Secured Term Loan B
VOIP-PAL.COM: Increases Authorized Common Shares to 9 Billion
WANDERLY LLC: Files Emergency Bid to Use Cash Collateral
WELCOME GROUP: Seeks Cash Collateral Access Until June 15
WESTLAKE SURGICAL: No Decline in Patient Care, 10th PCO Report Says
WHITE FOREST: Files Chapter 11 Bankruptcy w/ $79MM Debt, Sale Plans
ZANO INDUSTRIES: $20M Sale to TBE RE Acquisition to Fund Plan
ZANO INDUSTRIES: Cohen Weiss Represents Creditors
ZARIFIAN ENTERPRISES: Court OKs Carpentry Equipment Sale at Auction
[] Bankrupt Green Tech Startups Fuel Secondary-Market Bargains
*********
18222 YORBA: Files Chapter 11 Bankruptcy in California
------------------------------------------------------
On February 6, 2025, 18222 Yorba Linda Owner LLC filed Chapter 11
protection in the U.S. Bankruptcy Court for the Central District
of California.
According to court filing, the Debtor reports between $10 million
and $50 million in debt owed to 1 and 49 creditors. The petition
states funds will be available to unsecured creditors.
About 18222 Yorba Linda Owner LLC
18222 Yorba Linda Owner LLC is a single asset real estate debtor,
as defined in 11 U.S.C. Section 101(51B).
18222 Yorba Linda Owner LLC sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 25-10922) on
February 6, 2025. In its petition, the Debtor reports estimated
assets and liabilities between $10 million and $50 million each.
Honorable Bankruptcy Judge Julia W. Brand handles the case.
The Debtor is represented by:
Michael Jay Berger, Esq.
LAW OFFICES OF MICHAEL JAY BERGER
9454 Wilshire Boulevard, 6th Floor
Beverly Hills, CA 90212
Tel: (310) 271-6223
Fax: (310) 271-9805
Email: michael.berger@bankruptcypower.com
560 SEVENTH AVENUE: Unsecureds Will Get 17% of Claims in Plan
-------------------------------------------------------------
560 Seventh Avenue Owner Primary LLC filed with the U.S. Bankruptcy
Court for the Southern District of New York an Amended Disclosure
Statement with respect to Amended Chapter 11 Plan dated February 3,
2025.
The Debtor owns and operates a hotel in the Times Square
neighborhood of Manhattan under the brand name Margaritaville
Resort Times Square (the "Hotel").
The Hotel opened in July 2021 and is located at 560 7th Avenue, New
York, NY 10018. It is a 29-story full-service hotel with 234
guestrooms. The Hotel contains various food and beverage
concessions which the Debtor leases to tenants, including the
Margaritaville Restaurant & Tiki Bar, Joe Merchant's Coffee &
Provisions, LandShark Bar & Grill, License to Chill Bar and the 5
o'Clock Somewhere Bar.
When the Debtor, then controlled by its Former Directors and
Officers, first filed its chapter 11 petition, its corporate parent
at the time, 560 Seventh Avenue Owner Secondary LLC ("Secondary")
was already a debtor with its own chapter 11 case pending in the
Bankruptcy Court. Secondary filed its case in order to prevent a
pending foreclosure of collateral for a mezzanine loan it had
taken.
The mezzanine lenders, AREPIII MVTS, LLC (an affiliate of Arden
Group) and CREP Times Square Hotel LLC (an affiliate of Corten Real
Estate) (together, the "Mezzanine Lenders") obtained relief from
the automatic stay in Secondary's chapter 11 case and foreclosed on
their collateral consisting of 100% of the equity interests in the
Debtor. As a result, the Debtor is now owned and controlled by the
Mezzanine Lenders' designee, AC MVTS Holdco, LLC (together with its
affiliates or corporate parents, the "Parent"). Under the Parent's
management, the Debtor has continued to operate in chapter 11 and
now proposes the Plan as a means to exit chapter 11.
The Plan is predicated on agreements that the Debtor has reached
with many of its largest creditors for the treatment of their
claims as outlined herein and in the Plan. Chief among those is an
agreement with the Debtor's senior secured creditor, OWS CRE
Finding I, LLC, which agreement is set forth in the OWS Term Sheet
attached to the Plan. Another key agreement that the Debtor reached
was with its largest general unsecured creditor, the Garment Center
Congregation (the "Congregation"). The Debtor has also reached an
agreement with its former hotel manager, DHG TSQ, LLC for the
treatment of its secured and unsecured claims totaling
approximately $4.5 million.
As a result of these key agreements, and upon the terms and
conditions contained in the Plan, the Parent has agreed to forego
distributions on account of its $23,928,420.11 administrative
expense claim and to provide funding sufficient (when coupled with
the Debtor's cash on hand, if any) for the Debtor to make all
distributions and payments required to be made under the Plan on or
within 90 days following the Effective Date.
This funding will provide recoveries to creditors who would not
receive any recovery if the Debtor were to be liquidated under
chapter 7 of the Bankruptcy Code. The Debtor estimates that the
total value of the Parent's contributions to the Plan will be in
excess of $30 million. In exchange for such funding, the Parent (or
one or more of its designees) will either retain its existing
Equity Interests or be issued new Equity Interests in the Debtor.
The Plan funding to be provided by the Parent is not on account of
any preexisting Parent obligation, is indisputably substantial, and
is necessary to make the distributions and payments required by the
Plan.
Pursuant to the terms and conditions of the Plan and largely
through the funding provided by the Parent, all Administrative
Expense Claims will be paid in full, including Professional Fees.
Priority Tax Claims will also be paid in full. These claims will
all be paid on the later of the Effective Date or the date that
they become Allowed except that the Debtor may elect to pay
Priority Tax Claims in equal monthly installments over a period of
five years at the statutory rate of interest.
Secured Claims (other than the OWS Secured Claim, the DHG Claim and
the Flintlock Claim) will be paid in full on the Effective Date and
are unimpaired under the Plan, as are Priority Non-Tax Claims.
General Unsecured Claims (estimated by the Debtor to be
approximately $5.76 million) will receive their Pro Rata share of
$1 million provided that the Class votes to accept the Plan.
Personal Injury Claims (filed in the amount of $1.75 million) will
be permitted to pursue any available insurance proceeds
notwithstanding any chapter 11 or Plan stays or injunctions.
The Plan is a plan of reorganization. Upon the Effective Date of
the Plan, the Debtor will emerge from its Chapter 11 Case as a
Reorganized Debtor. Pursuant to the Plan, the Debtor's Parent will
make a New Value Contribution that will enable the Debtor to make
required distributions under the Plan. The Debtor has not received
any other offer from any person or entity to provide funding for
the Plan.
Class 3 is comprised of all General Unsecured Claims except for
Personal Injury Claims and the Congregation Claim. Provided Class 3
accepts the Plan, in full and final satisfaction, release and
discharge of the Debtor's obligations with respect to General
Unsecured Claims, each Holder of an Allowed General Unsecured Claim
in Class 3 shall receive, in full and complete settlement,
satisfaction and discharge of such Allowed General Unsecured Claim,
its Pro Rata share of $1,000,000.00. If Class 3 rejects the Plan,
it will not receive any distribution. The allowed unsecured claims
total $5,758,648. This Class will receive a distribution of 17% of
their allowed claims.
The Debtor and the Parent shall fund distributions under the Plan
(including with respect to settlements embodied herein) with (i)
Cash on hand; and (ii) the New Value Contribution.
A full-text copy of the Amended Disclosure Statement dated February
3, 2025 is available at https://urlcurt.com/u?l=avYNya from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Frederick E. Schmidt, Jr, Esq.
Cozen O'Connor
3WTC, 175 Greenwich Street, 55th Floor
New York, NY 10007
Telephone: (212) 883-4948
Email: eschmidt@cozen.com
Peter J. Roberts, Esq.
Christina M. Sanfelippo, Esq.
123 N Wacker Drive, Ste. 1800
Chicago, Illinois 60606
(312) 382-3100
Email: proberts@cozen.com
csanfelippo@cozen.com
About 560 Seventh Avenue Owner Primary
560 Seventh Avenue Owner Primary LLC owns and operates the
Margaritaville Resort Times Square Hotel located at 560 Seventh
Avenue, New York, NY. The Debtor sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 23-11289) on
August 12, 2023. In the petition signed by Stehian Pomerantz,
president, the Debtor disclosed up to $500 million in both assets
and liabilities.
Judge Philip Bentley oversees the case.
Kevin J. Nash, Esq., at Goldberg Weprin Finkel Goldstein LLP, is
the Debtor's legal counsel.
A GRANDE PROMOTION: Unsecureds to Split $135K over 45 Months
------------------------------------------------------------
A Grande Promotion Company, LLC, d/b/a AGF Granite & Marble ("AGP")
filed with the U.S. Bankruptcy Court for the District of Arizona a
Plan of Reorganization under Subchapter V dated January 31, 2025.
The Debtor founded as a provider of premium granite and marble
services, has been under its current ownership since 2012. The
company built a strong reputation for its craftsmanship, offering a
full-service experience from acquiring raw materials to
installation.
The challenges began to escalate after the COVID-19 pandemic
disrupted production and reduced demand for luxury stone products.
To cover operational expenses during this period, the owner, Eugene
Medrano, resorted to merchant cash advance loans ("MCA"), which
came with high interest rates and rigid repayment terms. While
initially intended as a temporary solution, these loans soon became
a financial burden as repayment obligations began to consume
profits.
Efforts to manage these debts included paying off several MCA
loans. However, the persistent economic pressures of inflation
forced the company to take out additional loans. To complicate
matters further, the MCA lenders issued liens against the
business's customers, preventing AGP from collecting profits on
completed projects. This freeze on incoming revenue exacerbated the
financial strain and left the company scrambling to keep its
operations running.
Despite these challenges, Mr. Medrano remains committed to keeping
the business afloat. The decision to file for bankruptcy was not
made lightly but is intended as a strategic step to restructure
debts and regain financial stability. Filing for bankruptcy offers
the company a chance to renegotiate terms with creditors, reduce
the immediate financial burden, and refocus on rebuilding its
operations and reputation in the market.
Creditors holding allowed claims will receive distributions based
upon Debtor's projected net disposable income over a period not to
exceed a 45-month term.
Class 10 consists of General Unsecured Claims. All non-insider
allowed and approved claims under this Class shall be paid their
allowed claims from all funds available for distribution as set
forth in the Disbursement Schedule. The allowed unsecured claims
total $2,200,459.55. The projected dividend of $135,520.23 is to be
paid over a period of 45 months, commencing in month one of the
Plan. This dividend shall be reduced by the Court approved
administrative expense claims of the Debtor's counsel, Court
appointed accounting professional (if any) and the Chapter 11
Subchapter V Trustee to the extent that said administrative expense
claims exceed the amounts listed in this Plan.
The Debtor may pre-pay any amounts due any creditor in this Class
prior to the due dates in the Plan of Reorganization without
penalty and without prior notice or Court approval unless otherwise
provided for in the Plan of Reorganization. This Class is impaired.
This Plan provide for payment of allowed claims to be made as set
forth in the attached Disbursement Schedule. This is a 45-month
Plan with a total projected Plan yield of approximately
$712,035.45. The total projected yield includes payment of
Administrative Expenses and Priority Claims. Debtor agrees that it
will make payments of not less than $712,035.45 over the life of
the Plan which represents the Debtor's projected disposable income
for that time period as required under the Code.
A full-text copy of the Plan of Reorganization dated January 31,
2025 is available at https://urlcurt.com/u?l=is5fSN from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Allan D. NewDelman, Esq.
Allan D. Newdelman, P.C.
80 East Columbus Avenue
Phoenix, AZ 85012
Tel: (602) 264-4550
Email: anewdelman@adnlaw .net
About A Grande Promotion Company
A Grande Promotion Company, LLC, a company in Phoenix, Ariz., filed
Chapter 11 petition (Bankr. D. Ariz. Case No. 24-09458) on Nov. 5,
2024, listing $100,000 to $500,000 in assets and $1 million to $10
million in liabilities. Eugene Medrano, a member and manager of A
Grande, signed the petition.
Judge Scott H Gan oversees the case.
Allan D. NewDelman, P.C., serves as the Debtor's legal counsel.
AIR INDUSTRIES: Michael Taglich Holds 18% Equity Stake
------------------------------------------------------
Michael N. Taglich disclosed in a Schedule 13D filed with the U.S.
Securities and Exchange Commission that as of January 31, 2025, he
beneficially owned 700,509 shares of Air Industries Group common
stock, representing 18% of the 3,660,487 shares reported
outstanding as of January 31. This includes 17,120 shares issuable
upon exercise of options and warrants, 219,679 shares issuable on
conversion of convertible notes (excluding accrued but unpaid
interest since December 31, 2020), and 23,995 shares held by
Taglich Brothers, Inc., where he is a shareholder and managing
director.
Mr. Taglich may be reached at:
Michael N. Taglich
Taglich Brothers, Inc.
37 Main Street, Cold Spring Harbor,
New York, NY, 11724-1423
516 757-1500
A full-text copy of Mr. Taglich's SEC Report is available at:
https://tinyurl.com/yc88j72d
About Air Industries
Headquartered in Bay Shore, New York, Air Industries Group (NYSE
American: AIRI) is a manufacturer of precision components and
assemblies for large aerospace and defense prime contractors. Its
products include landing gears, flight controls, engine mounts, and
components for aircraft jet engines, ground turbines, and other
complex machines.
Saddle Brook, New Jersey-based Marcum LLP, the Company's auditor
since 2008, issued a "going concern" qualification in its report
dated April 15, 2024. The report noted that for the period ending
March 31, 2024, the Company was not in compliance with the
financial covenants required under the terms of its current credit
facility. It is reasonably possible that the Company will not
receive a waiver and may fail to meet these financial covenants in
future periods. The Company is required to maintain a collection
account with its lender into which substantially all of the
Company's cash receipts are remitted. If the Company's lender were
to cease lending and keep the funds remitted to the collection
account, the Company would lack the funds to continue its
operations. Failure to receive a waiver or meet the financial
covenants in future periods raises substantial doubt about the
Company's ability to continue as a going concern.
As of September 30, 2024, Air Industries Group had $50.4 million in
total assets, $35.7 million in total liabilities, and $14.7 million
in total stockholders' equity.
AIR INDUSTRIES: Repays Over $1 Million in Subordinated Debt
-----------------------------------------------------------
Air Industries Group announced that it has repaid more than $1
million of its subordinated debt.
Lou Melluzzo, Chief Executive Officer of Air Industries Group
commented: "It is my pleasure to announce that we have repaid more
than $1 million of our subordinated debt. We expect to make
additional repayments in the coming months. Our goal is to
substantially reduce the remaining subordinated debt while
continuing to grow and enhance the profitability of the business."
About Air Industries
Headquartered in Bay Shore, New York, Air Industries Group (NYSE
American: AIRI) is a manufacturer of precision components and
assemblies for large aerospace and defense prime contractors. Its
products include landing gears, flight controls, engine mounts, and
components for aircraft jet engines, ground turbines, and other
complex machines.
Saddle Brook, New Jersey-based Marcum LLP, the Company's auditor
since 2008, issued a "going concern" qualification in its report
dated April 15, 2024. The report noted that for the period ending
March 31, 2024, the Company was not in compliance with the
financial covenants required under the terms of its current credit
facility. It is reasonably possible that the Company will not
receive a waiver and may fail to meet these financial covenants in
future periods. The Company is required to maintain a collection
account with its lender into which substantially all of the
Company's cash receipts are remitted. If the Company's lender were
to cease lending and keep the funds remitted to the collection
account, the Company would lack the funds to continue its
operations. Failure to receive a waiver or meet the financial
covenants in future periods raises substantial doubt about the
Company's ability to continue as a going concern.
As of September 30, 2024, Air Industries Group had $50.4 million in
total assets, $35.7 million in total liabilities, and $14.7 million
in total stockholders' equity.
AIR INDUSTRIES: Robert Taglich Holds 12.5% Equity Stake
-------------------------------------------------------
Robert F. Taglich disclosed in a Schedule 13D filed with the U.S.
Securities and Exchange Commission that as of January 31, 2025, he
beneficially owned 481,631 shares of Air Industries Group common
stock, representing 12.5% of the 3,660,487 shares reported
outstanding as of January 31. This includes 17,120 shares issuable
upon exercise of options and warrants, 168,907 shares issuable on
conversion of convertible notes (excluding accrued but unpaid
interest since December 31, 2020), and 23,995 shares held by
Taglich Brothers, Inc., where he is a shareholder and managing
director.
Mr. Taglich may be reached at:
Robert F. Taglich
Taglich Brothers, Inc.
37 Main Street, Cold Spring Harbor,
New York, NY, 11724-1423
516 757-1500
A full-text copy of Mr. Taglich's SEC Report is available at:
https://tinyurl.com/8hfawfyz
About Air Industries
Headquartered in Bay Shore, New York, Air Industries Group (NYSE
American: AIRI) is a manufacturer of precision components and
assemblies for large aerospace and defense prime contractors. Its
products include landing gears, flight controls, engine mounts, and
components for aircraft jet engines, ground turbines, and other
complex machines.
Saddle Brook, New Jersey-based Marcum LLP, the Company's auditor
since 2008, issued a "going concern" qualification in its report
dated April 15, 2024. The report noted that for the period ending
March 31, 2024, the Company was not in compliance with the
financial covenants required under the terms of its current credit
facility. It is reasonably possible that the Company will not
receive a waiver and may fail to meet these financial covenants in
future periods. The Company is required to maintain a collection
account with its lender into which substantially all of the
Company's cash receipts are remitted. If the Company's lender were
to cease lending and keep the funds remitted to the collection
account, the Company would lack the funds to continue its
operations. Failure to receive a waiver or meet the financial
covenants in future periods raises substantial doubt about the
Company's ability to continue as a going concern.
As of September 30, 2024, Air Industries Group had $50.4 million in
total assets, $35.7 million in total liabilities, and $14.7 million
in total stockholders' equity.
ALGORHYTHM HOLDINGS: Ionic Ventures Holds 9.9% Stake as of Dec. 31
------------------------------------------------------------------
Ionic Ventures, LLC, Ionic Management, LLC, Brendan O'Neil, and
Keith Coulston disclosed in a Schedule 13G filing with the U.S.
Securities and Exchange Commission that as of December 31, 2024,
they beneficially own 10,451,144 shares of Algorhythm Holdings,
Inc.'s common stock.
The number of shares of Common Stock outstanding and beneficially
owned by the reporting person and the associated CUSIP number for
the Common Stock disclosed in this Amendment No. 1 do not give
effect to the Reverse Stock Split, which has not been reflected on
Nasdaq as of February 4, 2025.
The shares owned represents 9.9% of the 94,164,916 shares of Common
Stock, as disclosed in the Prospectus Supplement, and do not give
full effect to the Warrants indirectly owned by the reporting
person, each subject to a 9.99% Blocker.
Ionic holds Series A Warrants exercisable for up to 13,970,588
shares of Common Stock and Series B Warrants exercisable for up to
13,970,588 shares of Common Stock, of which an aggregate of
10,451,144 shares of Common Stock issuable upon exercise of the
Warrants in any combination may be deemed beneficially owned by
Ionic as a result of the triggering of the Blockers in each of the
Warrants, which prohibit Ionic from exercising the Warrants for
shares of Common Stock if, as a result of such exercise, the holder
thereof, together with its affiliates and any persons acting as a
group together with such holder or any of such affiliates, would
beneficially own more than 9.99% of the total number of shares of
Common Stock then issued and outstanding immediately after giving
effect to any such exercise.
Consequently, Ionic is the beneficial owner of 10,451,144 shares of
Common Stock. Ionic has the power to dispose of and the power to
vote the Shares beneficially owned by it, which power may be
exercised by its manager, Ionic Management. Each of the managers of
Ionic Management, Mr. O'Neil and Mr. Coulston, has shared power to
vote and/or dispose of the Shares beneficially owned by Ionic and
Ionic Management. Neither Mr. O'Neil nor Mr. Coulston directly owns
the Shares. By reason of the provisions of Rule 13d-3 of the Act,
each of Mr. O'Neil and Mr. Coulston may be deemed to beneficially
own the Shares which are beneficially owned by each of Ionic and
Ionic Management, and Ionic Management may be deemed to
beneficially own the Shares which are beneficially owned by Ionic.
Ionic Ventures LLC may be reached at:
Keith Coulston
Manager of Ionic Management & Ionic Ventures
3053 Fillmore St
Suite 256
San Francisco, CA 94123
Tel: 415-999-2132
A full-text copy of Ionic Ventures' SEC Report is available at:
https://tinyurl.com/yks34xmy
About Algorhythm Holdings
Algorhythm Holdings, Inc., fka The Singing Machine Company, Inc. --
http://www.singingmachine.com/-- is a holding company for an AI
enabled software logistics business operated through its SemiCab
Holding subsidiary and a home karaoke consumer products company
that designs and distributes karaoke products globally to retailers
and ecommerce partners through the Singing Machine subsidiary.
Headquartered in Fort Lauderdale, Fla., the Company had $12,367,000
in total assets, $13,239,000 in total liabilities, and $872,000 in
total stockholders' deficit as of June 30, 2024.
The Company had cash on hand of approximately $1,245,000 as of June
30, 2024, which is not sufficient to fund the Company's planned
operations through one year after the date the consolidated
financial statements are issued. The Company has a recent history
of recurring operating losses and decreases in working capital. The
Company said these factors create substantial doubt about the
Company's ability to continue as a going concern for at least one
year after the date that the Company's audited consolidated
financial statements are issued.
AMERICAN RESOURCES: AIC Becomes CGRA Subsidiary in Share Exchange
-----------------------------------------------------------------
American Resources Corporation disclosed in a Form 8-K Report filed
with the U.S. Securities and Exchange Commission that the Company's
minority owned subsidiary, American Infrastructure Corporation,
completed the Share Exchange Agreement pursuant to the binding
terms sheet dated December 31, 2024, entered into and between AIC
and CGrowth Capital, Inc. (CGRA).
As set forth in the Share Exchange Agreement, CGRA purchased 100%
of the issued and outstanding shares of common stock of AIC and its
shareholders on a fully diluted basis. Concurrently CRGA issued to
the same shareholders of AIC, proportional to their respective
ownership of the common stock of AIC, 10,000,000 shares of newly
created Series A Preferred Stock. As a result, AIC is a wholly
owned subsidiary of CGRA, and all AIC shareholders will exchange
all their common stock in AIC, proportional to their ownership in
AIC, for a proportional amount of the 10,000,000 Series A shares.
The Series A provides its holders with non-dilution rights such
that, until converted to common stock as provided below, the Series
A will convert (as a group) into 92% of the fully diluted
outstanding shares of common stock of CGRA.
The Series A converts to common at the earlier of:
(i) at the discretion of the holder,
(ii) automatically upon uplisting of CGRA to a senior stock
exchange (such as NASDAQ, NYSE, CBOE) in the United States, or
(iii) automatically 12 months after issuance.
About American Resources Corp
American Resources Corporation operates through subsidiaries that
were formed or acquired in 2020, 2019, 2018, 2016, and 2015 for the
purpose of acquiring, rehabilitating, and operating various natural
resource assets, including coal used in the steel-making and
industrial markets, critical and rare earth elements used in the
electrification economy, and aggregated metal and steel products
used in the recycling industries.
As of June 30, 2024, American Resources had $195,519,282 in total
assets, $241,135,129 in total liabilities, and $45,615,847 in total
stockholders' deficit.
Lakewood, Colo.-based BF Borgers CPA PC, the Company's auditor
since 2020, issued a "going concern" qualification in its report
dated April 15, 2024, citing that the Company has suffered
recurring losses from operations, has a significant accumulated
deficit, and has continued to experience negative cash flows from
operations. These factors raise substantial doubt about the
Company's ability to continue as a going concern.
On May 3, 2024, the Audit Committee of the Company's Board of
Directors approved the dismissal of BF Borgers as its independent
registered public accounting firm. This decision followed charges
by the Securities and Exchange Commission against the firm and its
owner, Benjamin F. Borgers, for deliberate and systemic failures to
comply with Public Company Accounting Oversight Board (PCAOB)
standards. The charges included falsifying audit documentation,
misrepresenting compliance with PCAOB standards, and fabricating
audit reports. Borgers agreed to a $14 million civil penalty and
permanent suspension from practicing before the Commission.
On May 10, 2024, the Audit Committee approved the appointment of
GBQ Partners LLC as the Company's new independent public accounting
firm, effective immediately.
AMERICAN TIRE: Court Approves Asset Sale to Lender-Backed Buyer
---------------------------------------------------------------
American Tire Distributors, Inc. announced on Feb. 11, 2025, that
the U.S. Bankruptcy Court for the District of Delaware has approved
the sale of substantially all of the Company's assets to a buyer
entity formed by certain of the Company's existing lenders. Having
received this approval, the Company expects to effectuate the sale
by February 28, 2025, subject to customary closing conditions.
"We are pleased to have received Court approval of our sale
transaction with the Purchaser, which marks one of the final steps
in our sale process," said Michael Feder, Interim Chief Executive
Officer of ATD and Partner & Managing Director (retired, on recall)
at AP Services, LLC, an affiliate of AlixPartners, LLP. "Having
conducted a competitive sale process over the last several months,
we believe that this agreement represents the best path forward for
the business and all of our stakeholders. The Purchaser is poised
to move forward as a stronger partner to manufacturers and
customers."
Mr. Feder continued, "We are grateful to our manufacturer partners
and customers for their support throughout this process. We remain
focused on continuing to provide them with the outstanding levels
of service they expect from us as we work to complete this process.
We thank all of our associates for their continued focus and
dedication to ATD."
Kirkland & Ellis LLP is serving as legal counsel, Moelis and
Company LLC is serving as investment banker, and AP Services, LLC
is serving as restructuring advisor to ATD.
The Purchaser is represented by Akin Gump Strauss Hauer & Feld LLP
as legal counsel and Perella Weinberg Partners LP as financial
advisor.
The ABL Lenders are represented by Otterbourg P.C. as legal counsel
and Carl Marks & Co. as financial advisor.
Court filings and other information related to the chapter 11
proceedings, including instructions on how to file a proof of
claim, are available on a separate website administered by the
Company's claims agent, Donlin Recano & Company, LLC, at
www.donlinrecano.com/atd, by calling toll-free at 1-866-666-1597
(or 1-212-771-1128 for calls originating outside the U.S. or
Canada), or by sending an email to atdinfo@drc.equiniti.com.
About American Tire Distributors
Headquartered in Huntersville, N.C., American Tire Distributors
Inc. and its affiliates are the largest distributor of replacement
tires in North America based on dollar amount of wholesale sales.
With their network of over 115 distribution centers and 1,500
delivery vehicles, the Debtors service a geographic region covering
more than 90 percent of the replacement tire market for passenger
vehicles and light trucks in the United States. The Debtors carry
many of the nation's leading tire brands including Michelin,
Pirelli, and Continental. In addition, the Debtors' proprietary
Hercules brand is a leading private tire brand in North America.
American Tire Distributors and its affiliates sought relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case
No. 24-12391) on October 22, 2024. In its petition, American Tire
Distributors reported $1 billion to $10 billion in both assets and
liabilities.
Judge Craig T. Goldblatt oversees the cases.
The Debtors tapped Kirkland & Ellis as bankruptcy counsel;
Pachulski Stang Ziehl & Jones, LLP as Delaware counsel; AP
Services, LLC as restructuring advisor; and Moelis & Company, LLC
as financial advisor. Donlin, Recano & Company, Inc. is the notice
and claims agent and administrative advisor.
AMTECH SYSTEMS: Swings to $312,000 Net Income in Q1 Fiscal 2025
---------------------------------------------------------------
Amtech Systems, Inc. filed with the U.S. Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting a net income
of $312,000 on $24.39 million of net revenues for the three months
ended December 31, 2024, compared to a net loss of $9.36 million on
$24.92 million of net revenues for the three months ended December
31, 2023.
"I'm pleased to report a strong first quarter that exceeded the
high end of our guidance, with $24.4 million in revenue and $1.9
million in adjusted EBITDA. While industry softness remains a
headwind, we continue to make progress on our operational
excellence and cost optimization initiatives, evidenced by the $1.8
million year-over-year increase in adjusted EBITDA. With strong
long-term growth drivers that include AI infrastructure investments
and our initiatives to grow our consumables, parts and services
revenue, we are well positioned to deliver profitable growth that
should result in meaningful value creation for shareholders,"
commented Mr. Bob Daigle, Chief Executive Officer of Amtech.
As of December 31, 2024, the Company had $117.78 million in total
assets, $35.33 million in total liabilities, and $82.44 million in
total shareholders' equity.
Loan and Security Agreement
As previously disclosed, on January 17, 2023, the Company entered
into a Loan and Security Agreement among Amtech, its U.S. based
wholly owned subsidiaries Bruce Technologies, Inc., BTU
International, Inc., Intersurface Dynamics, Incorporated, P.R.
Hoffman Machine Products, Inc., and Entrepix, Inc., and UMB Bank,
N.A., national banking association. The Loan Agreement provided
for:
(i) a term loan in the amount of $12 million maturing January
17, 2028, and
(ii) a revolving loan facility with an availability of $8.0
million maturing January 17, 2024, each of which were secured by a
first priority lien on substantially all of our assets.
The recorded amount of the Term Loan had an interest rate of 6.38%
and the Revolver had a floating per annum rate of interest equal to
the Prime Rate, adjusted daily.
As of September 30, 2023, the Company was not in compliance with
the Debt to EBITDA and Fixed Charge Coverage Ratio financial
covenants under its Loan and Security Agreement with UMB Bank, N.A.
dated January 17, 2023. On December 5, 2023, the Company entered
into a Forbearance & Modification Agreement with the lender,
pursuant to which the lender agreed to forbear from exercising its
rights and remedies available as a result of such default.
The Loan Agreement with UMB Bank was fully repaid in the fourth
quarter of 2024 and was subsequently terminated effective September
11, 2024. The carrying value of debt under our Loan Agreement was
based on fixed interest rates. The fair value for the amended Loan
Agreement was estimated by discounting the future cash flows using
the current rates at which similar loans would be made to borrowers
with similar credit ratings and is therefore classified as Level 2
in the fair value hierarchy.
A full-text copy of the Company's Form 10-Q is available at:
https://tinyurl.com/2mxnetb2
About Amtech Systems Inc.
Tempe, Ariz.-based Amtech Systems, Inc. is a global manufacturer of
capital equipment, including thermal processing, wafer polishing
and cleaning, and related consumables used in fabricating
semiconductor devices, such as silicon carbide (SiC) and silicon
power devices, analog and discrete devices, electronic assemblies,
and light-emitting diodes (LEDs). It sells these products to
semiconductor device and module manufacturers worldwide,
particularly in Asia, North America, and Europe.
ANGIE'S TRANSPORTATION: Gets Final OK to Use BMO's Cash Collateral
------------------------------------------------------------------
Angie's Transportation, LLC and STL Equipment Leasing Co., LLC
received final approval from the U.S. Bankruptcy Court for the
Eastern District of Missouri, Eastern Division, to use the cash
collateral of BMO Bank N.A. until March 16.
BMO Bank is a secured creditor with valid liens on certain assets
owned by the companies.
As protection for the use of its collateral, BMO Bank will be
granted replacement liens on its collateral to the same extent and
with the same validity and priority as its pre-bankruptcy liens.
In addition, BMO Bank will receive payments, including an initial
payment of $2,200 and monthly payments of $3,700 due on or before
the 15th day of each month until further order of the court or the
effective date of a confirmed plan of reorganization.
About Angie's Transportation
Angie's Transportation, LLC, a trucking company in St. Louis, Mo.,
and STL Equipment Leasing Co, LLC filed Chapter 11 petitions
(Bankr. E.D. Miss. Lead Case No. 24-44594) on December 16, 2024.
At the time of the filing, Angie's reported $1 million to $10
million in assets and $500,000 to $1 million in liabilities while
STL reported $1 million to $10 million in both assets and
liabilities.
Judge Brian C. Walsh handles the cases.
The Debtors are represented by Andrew Magdy, Esq., at Schmidt
Basch, LLC.
ANGIE'S TRANSPORTATION: Gets OK to Use Daimler's Cash Collateral
----------------------------------------------------------------
Angie's Transportation, LLC and STL Equipment Leasing Co., LLC
received final approval from the U.S. Bankruptcy Court for the
Eastern District of Missouri, Eastern Division, to use the cash
collateral of Daimler Truck Financial until March 16.
Daimler is a secured creditor with valid liens on certain assets
owned by the companies.
Daimler will be granted replacement liens as protection for the use
of its collateral, to the same extent and with the same validity
and priority as its pre-bankruptcy liens.
As additional protection, Daimler will receive payments, including
an initial payment of $9,000 and monthly payments of $12,000 due on
or before the 15th day of each month until further order of the
court or the effective date of a confirmed plan of reorganization.
About Angie's Transportation
Angie's Transportation, LLC, a trucking company in St. Louis, Mo.,
and STL Equipment Leasing Co, LLC filed Chapter 11 petitions
(Bankr. E.D. Miss. Lead Case No. 24-44594) on December 16, 2024.
At the time of the filing, Angie's reported $1 million to $10
million in assets and $500,000 to $1 million in liabilities while
STL reported $1 million to $10 million in both assets and
liabilities.
Judge Brian C. Walsh handles the cases.
The Debtors are represented by Andrew Magdy, Esq., at Schmidt
Basch, LLC.
APPLIED ENERGETICS: Raises $1.2M in Stock Sale, Pre-Funded Warrants
-------------------------------------------------------------------
Applied Energetics, Inc., announced that it has successfully
completed the placement of 1,600,000 shares of its common stock,
with a par value of $0.001 per share, including underlying
pre-funded common stock purchase warrants. The Shares were sold in
a private transaction to individual buyers at a price of $0.75 per
share (or $0.749 per share for the pre-funded warrants), generating
total proceeds of $1,200,000.
The pre-funded warrants are exercisable immediately at a price of
$0.001 per share but may not be executed in any amount which would
cause the holder thereof to beneficially own 5% or more of the
Company's common stock. The Company has agreed to use its best
efforts to include the Shares for registration with the Securities
and Exchange Commission in the registration statement it files.
All of the purchasers are accredited, sophisticated investors, and
the issuance of the Shares was not in connection with any public
offering in accordance with Section 4(a)(2) of the Securities Act
of 1933.
About Applied Energetics
Headquartered in Tucson, Arizona, Applied Energetics, Inc. --
http://www.appliedenergetics.com/-- specializes in the development
and manufacture of advanced high-performance lasers and optical
systems, and integrated guided energy systems, for prospective
defense, national security, industrial, biomedical, and scientific
customers worldwide.
Las Vegas, NV-based RBSM LLP, the Company's auditor since 2016,
issued a "going concern" qualification in its report dated March
26, 2024, citing that the Company has suffered recurring losses
from operations and will require additional capital to fund its
current operating plan, that raises substantial doubt about the
Company's ability to continue as a going concern.
For the fiscal years ended Dec. 31, 2023 and 2022, the Company had
revenues of $2,631,443 and $1,307,757, respectively, and the
Company had net losses of $7,350,435 and $5,771,642, respectively.
The Company said it cannot guarantee that its planned operations
will generate future revenues or that any such revenues will lead
to profitability.
ARTIFICIAL INTELLIGENCE: To Deploy ROSA in Urban Waterfront Dist.
-----------------------------------------------------------------
Artificial Intelligence Technology Solutions, Inc., announced that
its subsidiary, Robotic Assistance Devices, Inc., continues to
expand its presence within the State, Local, and Education (SLED)
market sector, securing new deployments of its autonomous security
solutions. Organizations across these sectors are turning to RAD's
innovative technology to enhance public safety, reduce security
costs, and provide proactive deterrence against crime. The Company
has successfully placed RIO and ROSA devices in a range of
environments, including municipal spaces, educational institutions,
and high-traffic public districts, with additional deployments
expected in the near future.
The Company disclosed that as part of its expanding footprint, RAD
recently received an order for four ROSA units set to be deployed
in a busy urban waterfront district in a major Midwestern city.
These security devices will provide AI driven autonomous proactive
deterrence in addition to incident detection, and continuous
surveillance, deterrence in a high-traffic area frequented by
residents, businesses, and visitors. The deployment reflects the
growing demand among public sector organizations and improvement
districts for AI-powered security solutions that enhance safety
while optimizing operational efficiency.
According to the Company, "Recent data indicates that local
governments are prioritizing public safety and security in their
budgets. In 2023, cities increased their spending by an average of
6.7% compared to 2022, with a significant portion allocated to
public safety initiatives. Looking ahead, experts anticipate that
local governments will continue to elevate their investment in
public safety technologies. This trend includes the adoption of
artificial intelligence and other emerging technologies aimed at
enhancing security and efficiency."
Troy McCanna, chief security officer of RAD, said, "This latest
order is another indicator that cities and counties are embracing
autonomous security as a vital component of their safety
strategies. The positive reception we've seen in cities across the
country reinforces the effectiveness of our solutions and the
growing demand for cost-effective, responsive security
technology."
Utilized by the popular solar-powered RIO trailers, these ROSA
units will be mounted on existing light poles, utilizing a
continuous 24/7 power source. This installation method ensures
uninterrupted operation, making ROSA an ideal solution for urban
districts requiring persistent security coverage without reliance
on solar charging or a large footprint.
"As communities continue evaluating innovative security solutions,
many are also exploring RAD's SARA (Speaking Autonomous Responsive
Agent) technology," concluded McCanna. "By incorporating SARA, the
clients have the potential to further reduce costs while enhancing
community engagement and overall security effectiveness. With
additional orders expected soon, RAD is positioning itself as the
go-to provider for cities, counties and states looking to enhance
safety while maintaining operational efficiency."
ROSA is a multiple award-winning, compact, self-contained security
and communication device that can be installed and activated in
about 15 minutes. Its AI-driven capabilities include human,
firearm, and vehicle detection, license plate recognition,
responsive digital signage, audio messaging, and seamless
integration with RAD's software suite for real-time notifications
and autonomous intelligent responses. Two-way communication is
optimized for cellular, including live video from ROSA's
high-resolution, full-color, always-on cameras. RAD has published
six Case Studies detailing how ROSA has helped eliminate instances
of theft, trespassing and loitering at retail centers, hospital
campuses, multi-family communities, car rental locations and
construction sites across the country.
About Artificial Intelligence Technology
Headquartered in Ferndale, Mich., Artificial Intelligence
Technology Solutions Inc. is an innovator in the delivery of
artificial intelligence-based solutions that empower organizations
to gain new insight, solve complex challenges, and fuel new
business ideas. Through its next-generation robotic product
offerings, AITX's RAD, RAD-R, RAD-M, and RAD-G companies help
organizations streamline operations, increase ROI, and strengthen
business. AITX technology improves the simplicity and economics of
patrolling and guard services, allowing experienced personnel to
focus on more strategic tasks. Customers augment the capabilities
of existing staff and gain higher levels of situational awareness,
all at drastically reduced costs. AITX solutions are well-suited
for use in multiple industries such as enterprises, government,
transportation, critical infrastructure, education, and
healthcare.
Deer Park, Illinois-based L J Soldinger Associates, LLC, the
Company's auditor since 2019, issued a "going concern"
qualification in its report dated May 9, 2024, citing that the
Company had a net loss of approximately $20.7 million, an
accumulated deficit of approximately $133.0 million, and
stockholders' deficit of approximately $40.2 million as of and for
the year ended Feb. 29, 2024, which raises substantial doubt about
its ability to continue as a going concern.
For the nine months ended Nov. 30, 2024, the Company had negative
cash flow from operating activities of $8,894,284. As of Nov. 30,
2024, the Company has an accumulated deficit of $149,389,994, and
negative working capital of $37,294,051. Management does not
anticipate having positive cash flow from operations in the near
future.
AVINGER INC: Shareholders OK Assignment and Dissolution Plan
------------------------------------------------------------
Avinger, Inc. held its previously adjourned special meeting on
February 5, 2025. At the Adjourned Meeting, the Company's
stockholders voted on and approved the following proposals:
Proposal 1 – Assignment and Dissolution:
The proposal to approve an assignment for the benefit of creditors
followed by a voluntary dissolution and liquidation pursuant to a
plan of dissolution if the Company's board of directors deems such
action to be in its best interests and those of its stockholders,
which approval shall include authorization for its board of
directors to abandon such assignment and dissolution.
Proposal No. 2 - Approval of the Adjournment of the Special
Meeting:
The adjournment of the Special Meeting, if necessary, to continue
to solicit votes in favor of the foregoing proposal was approved.
Due to the approval of Proposal No. 1, there was no need to adjourn
the Adjourned Meeting. No other matters were considered or voted
upon at the Adjourned Meeting.
About Avinger Inc.
Headquartered in Redwood City, Calif., Avinger, Inc.
--http://www.avinger.com-- is a commercial-stage medical device
company that designs, manufactures, and sells real-time
high-definition image-guided, minimally invasive catheter-based
systems that are used by physicians to treat patients with
peripheral artery disease ("PAD"). Patients with PAD have a
build-up of plaque in the arteries that supply blood to areas away
from the heart, particularly the pelvis and legs. The Company's
mission is to significantly improve the treatment of vascular
disease through the introduction of products based on its
Lumivascular platform, the only intravascular real-time
high-definition image guided system available in this market.
San Francisco, Calif.-based Moss Adams LLP, the Company's auditor
since 2017, issued a "going concern" qualification in its report
dated March 20, 2024, citing that the Company's recurring losses
from operations and its need for additional capital, raise
substantial doubt about its ability to continue as a going
concern.
As of Sept. 30, 2024, Avinger had $13.60 million in total assets,
$9.73 million in total liabilities, and $3.88 million in total
stockholders' equity.
B. RILEY FINANCIAL: BlackRock Reports 5.1% Equity Stake
-------------------------------------------------------
BlackRock, Inc. disclosed in Schedule 13G Report filed with the
U.S. Securities and Exchange Commission that as of December 31,
2024, it beneficially owned 1,544,999 shares of B. Riley Financial
Inc.'s common stock, representing 5.1% of the shares outstanding.
BlackRock may be reached at:
Spencer Fleming
BlackRock, Inc.
50 Hudson Yards
New York, NY 10001
Tel: (212) 810-5800
A full-text copy of BlackRock's SEC Report is available at:
https://tinyurl.com/bdzmf69n
About B. Riley Financial
B. Riley Financial, Inc. -- http://www.brileyfin.com/-- is a
diversified financial services company that delivers tailored
solutions to meet the strategic, operational, and capital needs of
its clients and partners. B. Riley leverages cross-platform
expertise to provide clients with full service, collaborative
solutions at every stage of the business life cycle. Through its
affiliated subsidiaries, B. Riley provides end-to-end financial
services across investment banking, institutional brokerage,
private wealth and investment management, financial consulting,
corporate restructuring, operations management, risk and
compliance, due diligence, forensic accounting, litigation support,
appraisal and valuation, auction, and liquidation services. B.
Riley opportunistically invests to benefit its shareholders, and
certain affiliates originate and underwrite senior secured loans
for asset-rich companies.
As of June 30, 2024, B. Riley Financial had $3.2 billion in total
assets, $3.4 billion in total liabilities, and $143.1 million in
total deficit.
BALLY'S CORP: S&P Affirms 'B-' ICR, Outlook Stable
--------------------------------------------------
S&P Global Ratings affirmed all other ratings on Bally's Corp.,
including the 'B-' issuer credit rating.
The stable outlook reflects S&P's view that Bally's will generate
modest EBITDA growth and maintain sufficient liquidity for
operating needs despite its expectation for very high leverage from
spending on development projects.
Bally's Corp. announced that it closed its merger with Standard
General L.P., the company's largest shareholder, and combination
with The Queen Casino & Entertainment Inc.
Bally's used $500 million of senior secured notes due 2028 provided
exclusively by funds managed by Apollo along with available cash on
hand to fund $416 million of cash merger consideration to
shareholders who elected not to rollover their equity and $107
million to repay The Queen's debt.
S&P said, "The lowering of the issue-level rating and revision of
the recovery rating reflects our view that incremental debt issued
to fund the merger impaired recovery prospects for existing secured
lenders. On Feb. 7, 2025, Bally's announced it completed previously
announced transactions with Standard General, the company's largest
shareholder. As part of the transaction, Standard General acquired
outstanding shares that existing Bally's shareholders did not elect
to roll over and became the majority owner. Standard General now
owns approximately 74% of the company. Bally's also combined with
Standard General's majority-owned regional casino operator The
Queen Casino & Entertainment Inc. (the Queen). Bally's paid cash
consideration of $18.25 per share to holders of 22.8 million of its
outstanding shares who elected not to roll their stakes. The
company financed the cash merger consideration of approximately
$416 million and the repayment of the Queen's funded debt of $107
million with the issuance of $500 million in senior secured notes
due 2028 provided exclusively by funds managed by Apollo, along
with Bally's available cash on hand."
The new secured notes are guaranteed by each of the Bally's
subsidiaries that guarantee the existing credit agreement and are
secured on a pari passu basis by the property of Bally's and the
guarantors that secure the credit agreement. Although we raised our
recovery valuation on Bally's to incorporate incremental EBITDA
from the Queen, the higher valuation is insufficient to offset the
incremental secured debt issued to fund the transaction, lowering
recovery prospects for Bally's existing secured lenders.
S&P said, "We affirmed our 'B-' issuer credit rating because we
believe the company has sufficient liquidity to fund ongoing
development projects. The transaction modestly increases leverage
from current elevated levels, due to the issuance of debt to fund
the transaction and the incremental lease obligations at the Queen.
As a result, we expect leverage to be elevated above 11x over the
next 12 months as Bally's develops its permanent Chicago casino.
However, we expect the combined company to generate sufficient
EBITDA to cover fixed charges and forecast it will maintain
adequate liquidity to fund ongoing development projects at Bally's
and the Queen."
Bally's is currently developing a permanent casino in downtown
Chicago, which it expects to open in September 2026. According to
the company's proxy filing, management expects to spend about $1.4
billion in total capital expenditures (capex) through 2026,
including the Chicago development. Bally's and Gaming & Leisure
Properties Inc. (GLPI) previously entered into a binding term
sheet, which provides up to $940 million of construction funding
for hard costs of Bally's Chicago Casino Resort from August 2024
through December 2026. In addition, Bally's executed sale
leasebacks of its Kansas City and Shreveport casinos with GLPI and
used the $395 million of proceeds to repay borrowings under its
revolving credit facility, which totaled $350 million as of Sept.
30, 2024. The company intends to fund the remaining development
spending on the permanent facility with excess cash flow,
availability on its revolving credit facility, and proceeds from a
planned equity offering of the property as part of its host
community agreement. While S&P has not incorporated proceeds from
the offering in our base case due to a lawsuit that could lead to a
delay or cancellation of the offering, it believes Bally's has
sufficient funding commitments to complete the project.
The Queen is currently undergoing a landside development and hotel
renovation of Belle of Baton Rouge in Louisiana. GLPI has committed
to fund to $111 million of the project's hard construction costs.
The company expects to complete the project by September 2025. The
Queen also secured funding commitments of up to $12.5 million for a
second landside development project at Casino Queen Marquette,
which it also expects to complete in 2025. In August 2023, the
Queen completed its landside development at Casino Queen Baton
Rouge. While S&P expects only a partial year of EBITDA contribution
from the Queen and its development projects and anticipate some
construction disruption in 2025, it believes these expansion
projects will increase the combined company's EBITDA base. The
combination with the Queen expands the Bally's Casino & Resorts
segment to 19 gaming, entertainment, and hospitality facilities
across 11 U.S. states and improves geographic diversity.
While demand dynamics in the downtown Chicago market appear
attractive, Bally's faces execution risks with its permanent
facility. The Chicagoland market has high gaming supply, with 10
existing casinos and projects under construction within a 50-mile
radius. Bally's Chicago's closest competitor will be Rivers Casino
Des Plaines (within 20 miles; operated by Midwest Gaming), which
primarily draws its customers from Chicago's north side and
northern suburbs. Rivers has consistently maintained strong market
share and a high win per unit per day (WPUPD) despite significant
competition in the market.
S&P believes this high WPUPD demonstrates that Rivers does not have
enough gaming positions to meet demand and the greater Chicago
market has room to increase gaming capacity and increase revenue.
Bally's will need to leverage its location advantage with access to
the downtown Chicago market and, by extension, tourist visitation,
to significantly increase the market's gaming revenue for it to
meet its target of generating $250 million of EBITDAR annually at
the permanent facility.
In addition, the risks related to successfully ramping up the
operations and cash flow generation of a greenfield project are
high. Bally's will need to attract customers to a new property in a
highly competitive market with established operators,
notwithstanding the good recognition of the Bally's brand. In its
first full year of operations, Bally's temporary Chicago facility
has largely stabilized at around $10 million of monthly gross
gaming revenue and a 7% to 8% market share in Illinois. On Bally's
third quarter earnings call, management said its quarterly
admissions to the property grew more than 6% and its player
database now exceeds 113,000 customers.
Competitors within the marketplace already have large databases of
customers to market to and can allocate significant resources
toward marketing and promotions to protect their customer bases.
Moreover, the economy may weaken during construction, which could
cause visitation, revenue, and cash flow at the company's facility
to be lower than S&P currently expects because demand for gaming
relies on consumer discretionary spending and is highly sensitive
to economic conditions.
A slowing economy could pressure regional gaming revenue, posing
downside risk for Bally's during a period of heightened development
spend. Bally's underperformed S&P's expectations in 2024, largely
due to operating challenges in Lincoln, R.I. and Atlantic City, NJ.
S&P expects 2025 to be another year of muted regional gaming
revenue growth as consumer spending weakens and unemployment rises.
While some markets and properties may benefit from new investments,
others may struggle in a softening economy, especially those that
may cater to more value-oriented customers, or where competition is
increasing. This could expose Bally's to execution risks, given its
need to manage a sizable urban development project at a time when
leverage is elevated and the risk of a pullback in consumer
discretionary spending on gaming is increasing. While Bally's is
currently able to cover fixed charges with operating cash flow, it
has limited cushion to withstand operating volatility.
Although brick and mortar gaming revenue might soften this year,
overall total commercial gaming revenue in the U.S. could rise as
sports betting and iGaming growth will likely remain strong as
existing and new markets continue ramping up. Overall, S&P expects
Bally's will generate modest organic revenue growth in its core
brick and mortar portfolio and higher growth from its digital
operations, particularly in North America, as it expands its
digital presence in new markets.
S&P said, "The stable outlook reflects our view that while Bally's
will generate modest EBITDA growth and maintain sufficient
liquidity for operating needs, its credit measures will remain weak
through at least the next 24 months because of higher debt levels
from spending on development activity, including the company's
permanent Chicago casino.
"We could lower our rating on Bally's if its Chicago development
project faces construction delays or cost overruns that strain its
liquidity or requires it to seek additional funding, causing us to
question the sustainability of its capital structure. We could also
lower our rating if Bally's underperforms our base-case forecast or
the temporary casino and newly renovated Queen casinos expand
slower than we expect, causing leverage to increase materially
compared with our base-case forecast and straining liquidity.
"We believe an upgrade is unlikely within the next 12 months given
Bally's elevated leverage and negative discretionary cash flow from
the development spending associated with the Chicago project. That
said, we could raise the rating if we believe that its total S&P
Global Ratings-adjusted debt to EBITDA will stay under 7x,
incorporating development spending, operating volatility, and any
further leveraging acquisitions or shareholder returns."
BELLEVUE HOSPITAL: Court OKs $1.5M DIP Loan, Cash Collateral Access
-------------------------------------------------------------------
The Bellevue Hospital received interim approval from the U.S.
Bankruptcy Court for the Northern District of Ohio, Western
Division, to enter into a revolving credit facility for up to $1.5
million pursuant to its Post-Petition Loan and Security Agreement
with Firelands Regional Health System.
The interim order signed by Judge Mary Ann Whipple on Feb. 11
granted Firelands post-petition security interests in and liens on
Bellevue Hospital's assets other than claims or causes of action
under Chapter 5 of the Bankruptcy Code or any other avoidance
actions.
As additional protection to the lender, Bellevue Hospital's
obligations under the debtor-in-possession facility constitute
allowed superpriority administrative expense claims. Subject only
to the payment of the "carveout," these claims shall have priority
over all other claims.
No advances will be made under the DIP facility until the entry of
a final order.
Bellevue Hospital owes $800,000 to Firelands pursuant to the terms
of a promissory note (non-revolving credit), according to court
filings.
The Feb. 11 interim order also authorized Bellevue Hospital to use
cash collateral until Feb. 28.
The healthcare provider's authority to use cash collateral
terminates upon occurrence of certain events such as the
consummation of any transaction resulting in the sale or
disposition of all or substantially all of its assets, which does
not provide for the repayment in full of its obligations under the
DIP facility.
The Bank of New York Mellon Trust Company, N.A., in its capacity as
Master Trustee for the benefit of Fifth Third Bank, National
Association, asserts an interest in the cash collateral.
As protection for the use of its cash collateral, the senior
secured creditor will be granted replacement liens on and security
interests in the post-petition property of Bellevue Hospital, with
the same priority, extent and amount as its pre-bankruptcy liens
and security interests.
The senior secured creditor will also have allowed superpriority
administrative expense claims as additional protection.
Bellevue Hospital is indebted to Fifth Third Bank pursuant to,
among other things, the Master Trust Indenture, dated as of July 1,
2003, and certain Obligations issued under and made pursuant to the
Indenture. As of the petition date, Bellevue Hospital owed $17.4
million to the senior secured creditor.
Approximately $2.4 million of the cash collateral is currently in a
blocked account held with Fifth Third to be released in accordance
with the budget and terms of the interim order. Additionally, Fifth
Third is holding $150,000 in a separate blocked account as security
for the healthcare provider's continued use of its credit card.
The final hearing is set for Feb. 25.
About The Bellevue Hospital
The Bellevue Hospital is a healthcare provider offering a range of
services, including cancer care, cardiac and pulmonary rehab,
diagnostic imaging, emergency care, and surgery. It serves
residents of Bellevue, Clyde, Fremont, and surrounding areas,
providing care 24/7. The organization is governed by a board of
trustees and operates as a not-for-profit corporation. Bellevue
Hospital was founded in 1914 and has interests in several
subsidiary entities, including The Bellevue Hospital Foundation,
Bellevue Professional Services, Inc., Bellevue Hospital Pain
Management, LLC, Prairie Ridge, LLC, and Bellevue Hospital Medical
Holdings, LLC.
Bellevue Hospital filed Chapter 11 petition (Bankr. N.D. Ohio Case
No. 25-30191) on February 5, 2025, listing between $10 million and
$50 million in both assets and liabilities. Sara K. Brokaw, chief
executive officer of Bellevue Hospital, signed the petition.
Judge Mary Ann Whipple oversees the case.
Richard K. Stovall, Esq., at Allen Stovall Neuman & Ashton LLP,
represents the Debtor as legal counsel.
Fifth Third Bank, as senior secured creditor, is represented by:
Carrie M. Brosius, Esq.
Vorys, Sater, Seymour and Pease LLP
200 Public Square, Suite 1400 Cleveland, OH 44114
Telephone: (216) 479-6189
Email: cmbrosius@vorys.com
Firelands Regional Health System, as DIP lender, is represented
by:
Ellen Arvin Kennedy. Esq.
Dinsmore & Shohl, LLP
100 W. Main Street, Suite 900
Lexington, Kentucky 40507
Phone: (859) 425-1000
Facsimile: (859) 425-1099
Email: ellen.kennedy@dinsmore.com
BENEDICTINE UNIVERSITY: S&P Lowers Revenue Bonds Rating to 'BB'
---------------------------------------------------------------
S&P Global Ratings lowered its long-term rating on the Illinois
Finance Authority's series 2017 and 2021 revenue bonds outstanding,
issued for Benedictine University, to 'BB' from 'BBB-'. The outlook
is stable.
"The downgrade reflects our view of Benedictine's consistently weak
operations, with deficits since 2021 despite extraordinary
endowment draws in fiscal 2024, which are expected to continue in
fiscal 2025. As a result, financial resources and liquidity have
weakened," said S&P Global Ratings credit analyst Stefan Turcic.
S&P said, "The stable outlook reflects our expectation that
Benedictine's financial resource ratios will remain sufficient for
the current rating, despite projected weak operations, with another
elevated endowment draw in fiscal 2025. The stable outlook also
reflects our view of management's extensive actions to stabilize
enrollment and control expenses, with no additional debt
anticipated in the next few years.
"We could consider a negative rating action if enrollment decreases
materially, resulting in larger deficits which may require
long-term elevated endowment draws. Additional debt without a
commensurate increase in financial resources would be viewed
negatively.
"We could consider a positive rating action if operations improve
to near break-even operating results without supplementary
endowment draws, if financial resource ratios increase, and if
enrollment and demand metrics improve."
BIOXCEL THERAPEUTICS: To Execute 1-for-16 Reverse Stock Split
-------------------------------------------------------------
BioXcel Therapeutics, Inc., has submitted an amendment to its
Amended and Restated Certificate of Incorporation, as previously
amended or restated, to implement a reverse stock split of its
issued and outstanding common stock, with a par value of $0.001 per
share, as outlined in a Form 8-K filed with the Securities and
Exchange Commission.
At its special meeting of stockholders held on Jan. 28, 2025, and
upon the recommendation of the Company's Board of Directors, the
Company's stockholders approved a certificate of amendment to
effect a reverse stock split of the Common Stock at a ratio ranging
from any whole number between 1-for-5 and 1-for-30, as determined
by the Board in its discretion.
On Jan. 29, 2025, the Board approved a reverse stock split of the
Common Stock at a ratio of 1-for-16. The Company has filed the
Charter Amendment to effect a 1-for-16 reverse stock split of its
shares of Common Stock, to be effective as of 5:00 p.m. Eastern
Time on Feb. 7, 2025.
As a result of the Reverse Stock Split, every 16 shares of the
Company's Common Stock issued or outstanding will be automatically
reclassified into one validly issued, fully-paid and non-assessable
new share of Common Stock, subject to the treatment of fractional
shares as described below, without any action on the part of the
holders. Proportional adjustments will be made to the number of
shares of Common Stock awarded and available for issuance under the
Company's equity incentive plans, as well as the exercise price and
the number of shares issuable upon the exercise or conversion of
the Company's outstanding stock options and other equity securities
under the Company's equity incentive plans. All outstanding
warrants will also be adjusted in accordance with their terms. The
shares of Common Stock outstanding following the Reverse Stock
Split will remain fully paid and non-assessable. The Reverse Stock
Split will not affect the number of authorized shares of Common
Stock or the par value of the Common Stock.
No fractional shares will be issued in connection with the Reverse
Stock Split. Stockholders who would otherwise be entitled to
receive fractional shares as a result of the Reverse Stock Split
will automatically be entitled to receive a cash payment equal to
the market value of the fractional share. The reverse stock split
will affect all stockholders uniformly and will not alter any
stockholder's relative interest in the company's equity securities,
except for any adjustments for fractional shares.
Trading of the Common Stock on The Nasdaq Capital Market will
commence on a split-adjusted basis at market open on Feb. 10, 2025,
under the existing trading symbol "BTAI." The new CUSIP number for
the Company's Common Stock following the Reverse Stock Split will
be 09075P204.
About BioXcel Therapeutics
Headquartered in New Haven, Conn., BioXcel Therapeutics, Inc., is a
biopharmaceutical company utilizing artificial intelligence ("AI")
to develop transformative medicines in neuroscience and, through
the Company's wholly owned subsidiary, OnkosXcel Therapeutics LLC,
immuno-oncology. The Company is focused on utilizing cutting-edge
technology and innovative research to develop high-value
therapeutics aimed at transforming patients' lives. The Company
employs various AI platforms to reduce therapeutic development
costs and potentially accelerate development timelines.
Stamford, Conn.-based Ernst & Young LLP, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated March 22, 2024, citing that the Company has suffered
recurring losses from operations, has used significant cash in
operations, and has stated that substantial doubt exists about the
Company's ability to continue as a going concern.
Since the Company's inception, the Company has incurred significant
operating losses. The Company's net loss was $179.1 million and
$165.8 million for the years ended Dec. 31, 2023 and 2022,
respectively. As of Dec. 31, 2023, the Company had a stockholders'
deficit of approximately $56.5 million. The Company expects to
continue to incur significant expenses and increasing operating
losses for the foreseeable future.
BLUM HOLDINGS: Signs LOI to Acquire NorCal Cannabis Dispensary
--------------------------------------------------------------
Blum Holdings, Inc. disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that on January 31, 2025,
it entered into a binding letter of intent with a third party
seller which sets forth the terms and conditions of a proposed
transaction, pursuant to which the Company's wholly owned
subsidiary will acquire 100% of the common stock of a target
entity, which owns and operates a licensed cannabis dispensary in
Northern California.
The total consideration for the Proposed Transaction shall be
$2,000,000 comprised of:
(i) $1,300,000 payable in cash at closing,
(ii) $200,000 payable in cash or stock at the Seller's election
subject to earn-outs, and
(iii) $500,000 payable in shares of the Company's Common Stock
at a per share price of $1.90, which shall be issued at closing and
held in escrow, subject to a 12-month holdback. In addition,
performance-based bonus awards may be payable in cash or stock on
the first anniversary following the date of closing.
"This agreement is a testament to the hard work and dedication of
our team and shareholders over the past two years as we continue
executing on our turnaround strategy and enter a new era of growth.
The progress we have made would not have been possible without the
trust and support of our employees, corporate team, partners, and
shareholders, and for that, I am incredibly grateful. Their belief
in our vision has allowed us to take bold but disciplined steps
which we believe will stabilize and grow our business. We expect
this Transaction to represent a significant and meaningful
milestone in our journey, and we remain committed to driving
durable value for our team, shareholders, partners, and customers,"
said Sabas Carrillo, CEO of Blum Holdings.
"Beyond acquiring a dispensary with strong gross and net revenues,
we are equally excited to welcome such a hardworking and dedicated
team to Blum. Their experience, resilience, and commitment to
excellence align well with our culture, and we look forward to
working alongside them to build something truly special together
while integrating their operations into our expanding platform,"
Sabas added.
"That said, job's not finished. We still have work ahead of us to
successfully close this Transaction--work that must be done during
a particularly turbulent time in both the cannabis industry and the
broader political climate. While challenges remain, I have
confidence in our team's ability to navigate this moment with the
same determination and discipline that have brought us this far,"
concluded Sabas.
In connection with the Proposed Transaction, Blum Management
Holdings, Inc. entered into a senior secured convertible promissory
note in the original principal amount of $500,000. The Note earns
interest at a rate of 8% per annum and matures on March 31, 2025.
At the Holder's option, the Note may be converted into Class A
and/or Class B shares of the Target, based on a Target valuation of
$2,000,000, subject to decrease pursuant to certain
Performance-Based Tranche Reductions as defined and described in
the LOI. The Note provides for certain events of default that are
typical for a transaction of this type, including, among other
things, any breach of the representations, warranties or
affirmative covenants made by the Target in the Note and Security
Agreement.
In connection with the issuance of the Note, the Holder and the
Target entered into a security agreement (the "Security Agreement")
pursuant to which the Target agreed to grant to the Holder a
security interest in all of its assets to secure the obligations
under the Note.
The Proposed Transaction is subject to the execution of definitive
agreements. No assurances can be made that the Company will
successfully negotiate and enter into definitive agreements for the
Proposed Transaction or that the Company will be successful in
completing the Proposed Transaction.
About Blum Holdings
Blum Holdings, Inc., headquartered in Santa Ana, California, is a
cannabis company engaged in retail and distribution across
California. The company focuses on providing high-quality medical
and adult-use cannabis products and is known for its Korova brand,
which offers high-potency products in various categories. Blum
Holdings operates several dispensaries, including Blum OC in Orange
County, and locations under The Spot and Blum brands in Santa Ana,
Oakland, and San Leandro.
Costa Mesa, California-based Marcum LLP, the company's auditor
since 2018, issued a "going concern" qualification in its report
dated April 15, 2024. The report indicated a significant working
capital deficiency, substantial losses, and the need for additional
funds to meet obligations and sustain operations, raising
substantial doubt about Blum Holdings' ability to continue as a
going concern.
As of September 30, 2024, Blum Holdings had $38.7 million in total
assets, $66.2 million in total liabilities, and $27.5 million in
total mezzanine equity and stockholders' deficit.
BM318 LLC: Court Tosses President's Appeal of Receivership Order
----------------------------------------------------------------
Judge Mark T. Pittman of the United States District Court for the
Northern District of Texas dismissed the appealed case captioned as
BM318, LLC C/O TIMOTHY BARTON, PRESIDENT, ET AL., Appellants, v.
COURTNEY C. THOMAS, ET AL., Appellees, Case No. 4:24-cv-00863-P
(N.D. Tex.).
This appeal follows the final judgment from a bankruptcy
proceeding.
Timothy Barton filed the appeal pro se as President of BM318, LLC.
Courtney C. Thomas, Dixon Water Foundation, and Lumar Land &
Cattle, LLC filed a joint motion to dismiss the appeal.
On Sept. 23, 2022, the Securities Exchange Commission brought a
lawsuit against Barton in the Northern District of Texas, Dallas
Division in Civil Action No. 3:22-cv-2118-X. In the SEC Lawsuit,
the Dallas court appointed Courtney C. Thomas as the Receiver to
take exclusive possession and control of BM318 and numerous other
entities controlled by Barton. Given the Receivership Order in the
SEC Lawsuit, when BM318 filed an adversary proceeding against Dixon
in the Bankruptcy Case on Aug. 10, 2021, for alleged preferential
and fraudulent transfers, the Bankruptcy Court entered an order
authorizing Lumar and Receiver to intervene.
Vested with exclusive authority to direct the corporate governance
of BM318 under the Receivership Order, the Receiver took control of
BM318 in the Bankruptcy Case. Then, on behalf of BM318, the
Receiver entered into settlement agreements with Lumar and Dixon.
The Bankruptcy Court approved those settlements on May 28, 2024,
and entered the Agreed Judgment on Aug. 26, 2024. On Sept. 10,
2024, and despite the Receiver having exclusive control over BM318
in the Bankruptcy Case -- and Barton not having been a party in the
Bankruptcy Case -- Barton signed a Notice of Appeal in his
individual capacity pro se in this case and wrote "Appellant" next
to BM318's title.
Barton does not contest that he was a nonparty to the underlying
bankruptcy action. Instead, Barton rests his claim to standing on a
single Fifth Circuit opinion, Castillo v. Cameron County, Texas,
which held that nonparties may have standing on appeal if: (1) the
nonparties actually participated in the proceedings; (2) the
equities weigh in favor of hearing the appeal; and (3) the
nonparties have a personal stake in the outcome.
Even if Castillo did apply, Barton would fail to meet the standard.
Barton's reliance on Searcy v. Philips Electronics North America
Corp. to demonstrate "participation" in the Bankruptcy Case is
misplaced, the Court finds. As Barton admits, the Bankruptcy Court
barred him from taking any action to protect his own interests in
BM318 during settlement negotiations given the Receivership Order
in place. According to the Court, Barton did not personally
participate in the proceeding, and that is enough to disqualify his
right to appeal even under Castillo.
Additionally, given the Receivership Order, Barton is no longer in
control of BM318, the real party in interest. As a consequence,
Barton also has no personal stake in the outcome -- this interest
is now vested in the Receiver. As for any purported remaining
equity interest he owns in BM318, multiple courts have rejected the
notion that alleging a diminishment in value of equity interests is
sufficient to establish standing. Barton's lack of appellate
standing is therefore sufficient to dispose of this case, the Court
concludes.
Therefore, the Court grants the Appellees' Motion to Dismiss and
dismisses this appeal.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=CB8sBB from PacerMonitor.com.
About BM318 LLC
BM318, LLC is a Single Asset Real Estate (as defined in 11 U.S.C.
Section 101(51B)) based in Aledo, Texas.
BM318, LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Tex. Case No. 20-42789) on Sept. 1, 2020. The
petition was signed by Tim Barton, president. At the time of the
filing, the Debtor had estimated assets of between $1 million and
$10 million and liabilities of the same range. Judge Mark X.
Mullin oversees the case. Joyce W. Lindayuer Attorney, PLLC, is
the Debtor's legal counsel.
BULA DEVELOPMENTS: Court Orders Transfer of Mora's Chapter 13 Case
------------------------------------------------------------------
Judge Christopher M. Klein of the United States Bankruptcy Court
for the Eastern District of California held that Natasha Mora's
chapter 13 case should be transferred to this district. The chapter
13 case is presently pending in the United States Bankruptcy for
the Southern District of California.
The debtor Bula Developments, Inc. is owned in four equal 25
percent shares by Natash Mora, her spouse, and her parents. Mora
acts as the person in control.
Bula constructed a luxury home in La Jolla, California, that
has been rendered unsaleable by virtue of land subsidence issues
following collapse of a retaining wall allegedly attributable to
faulty engineering and/or construction.
The property had been marketed for two years with no offers. The
asking price was $15.8 million (down from $25 million. Interest was
accruing at a rate of $110,061 per month. There was an invalid
mechanics lien. Site repairs could cost $300,000.
Unfavorable developments in state court and a looming foreclosure
prompted Mora to file a chapter 11 petition for Bula in the Eastern
District of California on Dec. 26, 2023.
Bula engaged counsel, who eventually sought permission to withdraw
because Mora was not cooperating in performing debtor in-possession
duties. That problem led the Bankruptcy Court to order appointment
of a chapter 11 trustee for cause.
The Bankruptcy Court granted a pending stay relief motion to permit
foreclosure to proceed.
The chapter 11 trustee later sold the estate's causes of action
regarding construction and engineering defects.
In a post-foreclosure unlawful detainer action, the San Diego
County Superior Court denied Mora's claims of right of possession
and ordered the Sheriff to enforce the writ of possession. The
California Court of Appeal, Fourth District, denied Mora's
emergency writ of mandamus on Dec. 30, 2024.
The next day, Dec. 31, 2024, Mora filed her chapter 13 case, No.
24-04961, in the Southern District of California.
On Jan. 6, 2025, Mora filed in the U.S. District Court, Southern
District of California, a complaint alleging one cause of action
under the Fourteenth Amendment Due Process Clause.
On Jan. 24, 2025, the Bankruptcy Court sua sponte invoked Rule 1014
(b), issued an order to show cause why Mora's chapter 13 case
should not be transferred to this district and ordered the parties
not to proceed further until the question is decided.
Mora's status as a 25 percent shareholder qualifies her as an
"affiliate" for purposes of Rule 1014(b) (1) (D) because she is an
entity that owns 20 percent or more of the outstanding voting
securities of the debtor corporation.
The Bula chapter 11 case has been pending in this district for more
than one year. Its docket has 298 entries. The chapter 11 trustee
filed a statement supporting transfer to this district.
The chapter 11 trustee filed a statement supporting transfer to
this district.
Mora filed a statement to the effect that she does not oppose
transfer.
Consideration of the "interest of justice" militates in favor of
transfer, the Bankruptcy Court finds. The justice system has a
strong interest in preventing abusive litigation practices.
Transfer under sec. 1412 is warranted in this case on account of
the "interest of justice" in preventing abusive litigation without
reference to the "convenience of the parties."
Nevertheless, the "convenience of the parties" also provides an
adequate, independent basis for ordering transfer, according to the
Bankruptcy Court.
Of the various factors articulated in the various reported transfer
decisions, considerations of economic and efficient case
administration loom particularly large, the Bankruptcy Court finds.
No party in interest has asserted that the the Eastern District of
California is an inconvenient forum. As to location, this court
permits liberal remote access to court proceedings so as to ease
the burden of requiring traveling to the courthouse.
In short, the "convenience of the parties" favors transfer to the
Eastern District of California.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=lEycNs from PacerMonitor.com.
About Bula Developments
Bula Developments, Inc. sought protection for relief under Chapter
11 of the Bankruptcy Code (Bankr. E.D. Calif. Case No. 23-24619) on
Dec. 26, 2023, listing $10 million to $50 million in assets and $1
million to $10 million in liabilities.
Gabriel E. Liberman, Esq. at the Law Offices of Gabriel Liberman,
APC represents the Debtor as counsel.
BYJU'S ALPHA: Procurement Biz Halts $533MM Debt Fight Disclosure
----------------------------------------------------------------
Ronan Barnard of Law360 reports that on February 11, 2025, a London
judge ruled that requires a U.K. procurement company to provide
evidence for Delaware court proceedings involving the bankrupt U.S.
subsidiary of Indian edtech firm Byju's would be oppressive.
The case concerns an allegedly fraudulent $533 million transaction,
the report states.
About BYJU's Alpha
BYJU's Alpha, Inc., designs and develops education software
solutions.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 24-10140) on Feb. 1, 2024. In the
petition signed by Timothy R. Pohl, chief executive officer, the
Debtor disclosed up to $1 billion in assets and up to $10 billion
in liabilities.
Judge John T. Dorsey oversees the case.
Young Conaway Stargatt & Taylor, LLP and Quinn Emanuel Urquhart &
Sullivan, LLP serve as the Debtor's legal counsel.
GLAS Trust Company LLC, as DIP Agent and Prepetition Agent, is
represented in the Debtor's case by Kirkland & Ellis LLP, Pachulski
Stang Ziehl & Jones, and Reed Smith.
C-BOND SYSTEMS: Barry Edelstein Steps Down as Director
------------------------------------------------------
C-Bond Systems Inc. disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that Barry M. Edelstein, a
member of the Board of Directors, notified the Company of his
intention to resign from the Board due to changing professional
priorities, effective December 31, 2024.
Mr. Edelstein did not advise the Company of any disagreement with
the Company on any matter relating to its operations, policies or
practices. Effective upon Mr. Edelstein's resignation as a
director, the size of the Board will be reduced from three to two
directors.
About C-Bond Systems Inc.
San Antonio, Texas-based C-Bond Systems, Inc. is a nanotechnology
company and the sole owner and developer of the patented C-Bond
technology. The Company focuses on the implementation of
proprietary nanotechnology applications and processes to enhance
the strength, functionality, and sustainability of brittle material
systems.
Boca Raton, Fla.-based Salberg & Company, P.A., the Company's
auditor since 2017, issued a "going concern" qualification in its
report dated April 1, 2024, noting that the Company had 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, as of December 31, 2023.
These matters raise substantial doubt about the Company's ability
to continue as a going concern.
As of September 30, 2024, C-Bond Systems had $1,418,414 in total
assets, $4,255,200 in total liabilities, $2,032,224 in commitments
and contingencies, and $4,869,010 in total stockholders' deficit.
C-BOND SYSTEMS: Transfers Assets to Badcer Ops in Debt Settlement
-----------------------------------------------------------------
C-Bond Systems Inc. disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that on January 30, 2025,
the Company entered into that certain Debt Forgiveness, Equity
Redemption and Strict Foreclosure Agreement with C-Bond Systems,
LLC, Patriot Glass Solutions, LLC, Badcer Ops, Inc., Jeff Badders,
Badders Children's Trust, Mercer Street Global Opportunity Fund,
LLC, and Michael Wanke. The closing of the transactions
contemplated by the Agreement occurred on January 30, 2025.
As settlement of all outstanding debt instruments owed to the
parties in this Agreement and associated liens, and pursuant to
Section 9-620 of the Uniform Commercial Code of the State of Texas,
at the Closing, the Company, C-Bond LLC, and Patriot, voluntarily
transferred, conveyed and assigned to Badcer all of the Debtors'
legal, equitable and beneficial right, title and interest in and to
all assets of the Debtors, including, but not limited to, the
following:
(i) the 80% of the Membership Interest (as defined in the
Operating Agreement of Patriot, dated as of July 2021 and the Units
(as defined in such Operating Agreement) comprising such 80% of the
Membership Interests of Patriot, which are held by C-Bond;
(ii) 100% of the membership interests of C-Bond LLC, which are
held by C-Bond;
(iii) all of Patriot's accounts receivable; and
(iv) certain patents as set forth in Exhibit C to the
Agreement; among other assets.
Under the terms of the Agreement, the Company will continue to
market Patriot's products under a Representative Agreement, and
will continue to be involved in the manufacturing of Patriot's
products.
In addition, at the Closing,
(i) C-Bond redeemed from Badcer the Badcer Preferred Shares
(as defined in the Agreement) in exchange for a payment of $1.00 in
total, and Badcer assigned all of Badcer' rights, titles and
interest in and to the Badcer Preferred Shares to C-Bond;
(ii) C-Bond redeemed from Mr. Wanke the the Wanke Common Shares
in exchange for a payment of $1.00 in total, and Mr. Wanke assigned
all of Mr. Wanke's rights, titles and interest in and to the Wanke
Common Shares to C-Bond;
(iii) C-Bond redeemed from Badders Trust the Badders Trust
Common Shares in exchange for a payment of $1.00 in total, and
Badders Trust to assigned all of Badders Trust's rights, titles and
interest in and to the Badders Trust Common Shares to C-Bond; and
(iv) C-Bond redeemed from Mr. Badders the Badders Common Shares
in exchange for a payment of $1.00 in total, Mr. Badders assigned
all of Mr. Badders' rights, titles and interest in and to the
Badders Common Shares to C-Bond. Effective as of the Closing, Scott
Silverman and Allison Tomek resigned from all positions they may
hold as managers or officers of C-Bond LLC.
About C-Bond Systems Inc.
San Antonio, Texas-based C-Bond Systems, Inc. is a nanotechnology
company and the sole owner and developer of the patented C-Bond
technology. The Company focuses on the implementation of
proprietary nanotechnology applications and processes to enhance
the strength, functionality, and sustainability of brittle material
systems.
Boca Raton, Fla.-based Salberg & Company, P.A., the Company's
auditor since 2017, issued a "going concern" qualification in its
report dated April 1, 2024, noting that the Company had 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, as of December 31, 2023.
These matters raise substantial doubt about the Company's ability
to continue as a going concern.
As of September 30, 2024, C-Bond Systems had $1,418,414 in total
assets, $4,255,200 in total liabilities, $2,032,224 in commitments
and contingencies, and $4,869,010 in total stockholders' deficit.
CALIFORNIA QSR: Unsecureds Will Get $788 per Month for 60 Months
----------------------------------------------------------------
California QSR Management, Inc., submitted an Amended Plan of
Reorganization for Small Business dated February 3, 2025.
QSR is a managing company that operates its related two entities,
Pinnacle Food of California, LLC and Tyco Group, LLC. It receives
the revenue from Pinnacle and Tyco and pays the expenses of
Pinnacle and Tyco, including payroll, with the exception of payroll
for Pinnacle's management team which is paid directly by Pinnacle.
This Plan of Reorganization proposes to pay creditors of the Debtor
from the revenue it collects from the operation of Pinnacle Foods
of California, LLC and Tyco Group LLC (until the San Diego location
is sold).
The final Plan payment is expected to be paid on February 2030
(estimated).
Class 3 consists of Non-priority unsecured creditors. The total
amount of the allowed general unsecured claims is $1,576,517.77.
Based on the liquidation analysis and the income valuation of the
Debtor's assets, the holders of allowed general unsecured claims
will be receiving an estimated 3% pro-rata distribution through the
plan.
The distribution to allowed general unsecured claims will be made
monthly, with the first payment of $788.26 due on the Effective
Date, followed by 59 consecutive payments, each in the amount of
$788.26 to be paid pro-rata to each holder of allowed general
unsecured claim. This Class is impaired.
The equity security holder of the Debtor is Imran Damani. Mr.
Damani is the President and 100% equity security holder of the
Debtor. He does not hold a pre-petition or a post-petition claim
against the Debtor.
The Debtor's plan is supported from the revenue it collects from
the operation of Pinnacle Foods of California, LLC and Tyco Group
LLC (until the San Diego location is sold).
A full-text copy of the Amended Plan dated February 3, 2025 is
available at https://urlcurt.com/u?l=OL38Xs from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Boulevard, 6th Floor,
Beverly Hills, CA 90212
Telephone: (310) 271-6223
Facsimile: (310) 271-9805
Email: rnichael.bergerbankruptcypower.com
About California QSR Management
California QSR Management, Inc., is a California Corporation formed
on February 19, 2019.
The Debtor filed its voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Cal. Case No. 24-11017) on
April 22, 2024, listing $168,469 in assets and $5,086,596 in
liabilities. The petition was signed by Imran Damani as president.
Judge Rene Lastreto II presides over the case.
Michael Jay Berger, Esq., at LAW OFFICES OF MICHAEL JAY BERGER, is
the Debtor's counsel.
CALIFORNIA RESOURCES: Fitch Affirms B+ LongTerm IDR, Outlook Stable
-------------------------------------------------------------------
Fitch Ratings has affirmed California Resources Corporation's (CRC)
Long-Term Issuer Default Rating (IDR) at 'B+'. Fitch has also
affirmed the issue-level ratings for the company's secured
reserve-based lending (RBL) credit facility at 'BB+' with a
Recovery Rating of 'RR1' and senior unsecured notes at 'BB-'/'RR3'.
The Rating Outlook is Stable.
CRC's ratings reflect its large, low-decline asset base with
exposure to Brent pricing, its conservative capital structure, the
forecast sub-1.5x midcycle leverage, the expectations of positive
FCF through the rating horizon, and its proactive hedging program
that limits downside price risks. These factors are partially
offset by the company's modest near-term production declines, high
cost structure, which limits economic drilling prospects, and
exposure to California's stringent regulatory environment, which
could disrupt permitting, drilling, and financing options.
Key Rating Drivers
Aera Synergies on Track: CRC is on track with its Aera Energy, LLC
synergies goal with $135 million already implemented since the
merger close in 2Q24. The company has realized approximately $60
million of synergies associated with interest expense reduction,
and implemented $50 million in general and administrative (G&A)
savings and additional operational savings. Fitch believes the
remaining $100 million in synergies, mostly targeting operations,
are highly likely in 2025 and will have a favorable impact in 2026
and beyond.
Modest Near-Term Production Declines: Fitch believes CRC's
near-term production declines are manageable given its permitting
options and large, multi-play asset base, which provides capital
and operational optionality to navigate regulatory disruptions.
Management plans to start 2025 with a one-rig program and manage
its already-low natural declines via workovers, sidetracks, and new
wells with permits on hand. Fitch expects this approach to result
in low-to-mid single-digit production declines in 2025, consistent
with 2024.
Strong Near-Term Hedging: Fitch views CRC's hedging policy
positively as it secures material FCF for 2025 and provides
substantial downside price protection. Approximately 72% of CRC's
2025 oil production is hedged at an average floor price of
$67/barrel (bbl) Brent, which decreases to approximately 35% in
2026. The company also has hedged approximately 65% of its natural
gas at attractive prices. Fitch expects hedging to continue at
similar levels going forward to ensure strong FCF generation and
capacity for debt reduction. CRC's credit facility also requires
minimum hedging of 50% to 0%, with leverage above 2.0x or below
1.5x, respectively.
High-Cost, Low-Netback Producer: CRC's cost structure is higher
than that of most Fitch-rated U.S. onshore exploration and
production (E&P) peers. Fitch-calculated 3Q24 total cash operating
costs, including operating costs, transportation expenses, G&A and
production taxes, remain at the higher end of Fitch's aggregate E&P
peer group, and lead to lower unhedged cash netbacks and a higher
breakeven oil price compared with that of its closest peers.
Sub-1.5x Midcycle Leverage: Fitch-calculated gross debt/EBITDA is
forecast to remain below 1.0x in 2025 and below 1.5x through the
remainder of the forecast given the company's conservative capital
structure. Fitch believes management will prioritize FCF for
repayment of the 2026 notes prior to maturity.
Carbon-Management Initiatives: Fitch views CRC's Carbon Management
(CM) joint venture (JV) with Brookfield Renewable favorably, given
CRC's focus on reducing carbon emissions, Brookfield's significant
expertise and investment in CM projects, and the potential cash
flow and tax credits the segment could generate in the medium and
long term.
Fitch's base case scenario includes the company's expected capital
investments and does not include any revenues from CRC's CM
businesses, given the uncertainty about timing and magnitude of
cash flows, and potential for separation of the E&P and CM
businesses. CRC continues to advance its CM businesses, supporting
management's goal of reliable, safe and ESG-driven operations.
California Regulatory Considerations: California adopted some of
the most restrictive regulations on in-state produced energy as it
shifts toward cleaner, more renewable forms of energy. The state
established limits on greenhouse gas (GHG) emissions, with a target
of at least 40% below the 1990 level by 2030. This target is in
addition to the state's established policy to achieve carbon
neutrality by 2045.
Although there is a need to drill in California to meet the excess
demand for oil and gasoline in the state, Fitch cautions that
regulatory and legislative actions in the state could disrupt
drilling, permitting, and financing options for the company.
Derivation Summary
CRC is a mid-sized operator with 3Q24 average daily production of
145 thousand barrels of oil equivalent per day (Mboepd) (78% oil).
The company is larger than Canadian producer MEG Energy Corp.
(BB-/Stable; 105 Mboepd [100% bitumen]), similar in size to Baytex
Energy Corp. (BB-/Stable; 154 Mboepd), but smaller than Matador
Resources Company (BB-/Positive; 171 Mboepd) and SM Energy Company
(BB/Stable; 170 Mboepd).
CRC's realized prices are typically higher than peers given the
exposure to premium Brent pricing, and its low-decline asset base
leads to lower capital intensity versus peers. This is partially
offset by the company's high cost structure, which results in lower
Fitch-calculated unhedged cash netbacks compared with Fitch's
aggregate peer average.
Key Assumptions
- Brent oil prices of $70/bbl in 2025, $65/bbl in 2026 and 2027 and
$60/bbl thereafter;
- Henry Hub prices of $2.5/thousand cubic feet (mcf) in 2025 and
$2.75/mcf thereafter;
- One rig drilling program in 2025 resulting in modest yoy
production declines, which flatten through the base case;
- Moderate increase in yoy capex to manage low natural declines,
increasing in 2026 and thereafter;
- Measured increases to the fixed dividend and shareholder
returns;
- No material M&A activity.
Recovery Analysis
Key Recovery Rating Assumptions
- The recovery analysis assumes CRC would be reorganized as a
going-concern (GC) in bankruptcy rather than liquidated.
- Fitch assumes a 10% administrative claim.
GC Approach
Fitch's projections under a stressed case price desk, which assumes
Brent oil prices of $35/bbl in 2025, $45/bbl in 2026 and $48/bbl in
the long term.
The GC EBITDA reflects Fitch's view of a sustainable,
post-reorganization EBITDA level upon which Fitch bases the EV,
which reflects the decline from current pricing to stressed levels,
and then a partial recovery coming out of a troughed pricing
environment. Fitch believes a weakened pricing environment would
lead to production declines, reduce the borrowing base availability
and materially erode the liquidity profile.
An EV multiple of 3.00x EBITDA is applied to the GC EBITDA to
calculate a post-reorganization EV. The choice of this multiple
considered the following factors:
The historical bankruptcy case study exit multiples for peer
companies ranged from 2.8x to 7.0x, with an average of 5.2x and a
median of 5.4x;
The multiple reflects the expectation that the value of CRC's oil
producing properties will decline given the company's high cost
structure and a reduction in capex to preserve liquidity. The
multiple also considers the stringent California regulatory
environment and highly concentrated market, which severely limits
the number of potential buyers and valuation for the assets.
Liquidation Approach
The liquidation estimate reflects Fitch's view of the value of
balance sheet assets that can be realized in sale or liquidation
processes conducted during a bankruptcy or insolvency proceeding
and distributed to creditors.
The revolver is assumed to be 90% drawn upon default with the
expectation that commitments would be reduced during a
redetermination.
The allocation of value in the liability waterfall results in
recovery corresponding to 'RR1' recovery for the first-lien RBL
credit facility and a recovery corresponding to 'RR3' for the
senior unsecured notes.
The RBL is assumed to be fully drawn upon default.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Unfavorable regulatory actions that result in material production
declines and/or weakened profitability;
- Deteriorating liquidity profile, including material revolver
borrowings and an inability to generate positive FCF;
- Midcycle EBITDA leverage sustained above 2.0x.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Diversification through meaningful EBITDA generation from CM or
other non-E&P business lines;
- Material E&P diversification outside California;
- FCF generation that supports the liquidity profile and limited
borrowings under the RBL credit facility;
- Commitment to conservative financial policy, resulting in
midcycle EBITDA leverage sustained below 1.5x.
Liquidity and Debt Structure
As of Sept. 30, 2024, CRC had $213 million of cash on its balance
sheet and $925 million of borrowing capacity under the $1.1 billion
RBL, net of approximately $175 million of outstanding letters of
credit. The RBL is subject to a semi-annual borrowing base
redetermination in addition to financial covenants, including a
maximum total net leverage ratio of below 3.0x and a minimum
current ratio of at least 1.0x.
Fitch believes CRC's forecast FCF generation and strong hedge book
supports the liquidity profile and does not expect incremental RBL
borrowings throughout the base case. Fitch expects CRC to fully
repay the remaining 2026 notes via cash on hand prior to maturity.
Issuer Profile
CRC is an integrated public E&P company that operates solely in
California. At 3Q24, the company was producing 145 Mboepd (78% oil)
and held more than 1.9 million net mineral acres.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
CRC has an ESG Relevance Score of '4' for Exposure to Social
Impacts due to the stringent oil and gas regulatory environment in
California and its exposure to social resistance, which has a
negative impact on the credit profile, and is relevant to the
rating in conjunction with other factors.
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.
The company's JV with Brookfield Renewable advances CRC's
energy-transition strategy, substantially reduces its CM funding
risks, and supports the JV's goals of achieving the first carbon
dioxide (CO2) injection by YE 2025 and storing five million metric
tons of CO2 per annum (200 million metric tons of total CO2 storage
capacity) by YE 2027.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
California Resources
Corporation LT IDR B+ Affirmed B+
senior unsecured LT BB- Affirmed RR3 BB-
senior secured LT BB+ Affirmed RR1 BB+
CAMPBELL FAMILY: Seeks to Use Cash Collateral Until March 31
------------------------------------------------------------
Campbell Family Enterprises, Inc. asked the U.S. Bankruptcy Court
for the Northern District of Mississippi for authority to use cash
collateral until March 31.
The company has an immediate business need to use cash collateral
to continue operations, acquire goods and services, and pay other
necessary and essential business expenses.
Cleveland State Bank asserts an interest in the company's real and
personal property, including cash collateral.
As adequate protection, Cleveland State Bank will be granted a
replacement security interest in, and liens on, all post-petition
acquired property of the company's estate that is the same type of
property that the bank holds a pre-bankruptcy interest, lien or
security interest to the extent of the validity and priority of
such interests, liens, or security interests. Further, Campbell
will continue to maintain adequate insurance on all its property
and assets.
About Campbell Family Enterprises
Campbell Family Enterprises, Inc. filed Chapter 11 petition (Bankr.
N.D. Miss. Case No. 25-10364) on February 4, 2025, listing up to
$500,000 in total assets and $1 million in total liabilities.
Phillip Campbell, a member of Campbell Family Enterprises, signed
the petition.
Judge Selene D. Maddox oversees the case.
Thomas C. Rollins, Jr., Esq., at The Rollins Law Firm, PLLC,
represents the Debtor as bankruptcy counsel.
CAPSTONE COMPANIES: Amends $485K Loan Agreement With Coppermine
---------------------------------------------------------------
Capstone Companies, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that it entered into an
Amended and Revised Unsecured Promissory Note evidencing a loan
from Coppermine Ventures, LLC, a private Maryland limited liability
company based in Baltimore County, Maryland.
The New Note amends, revises and supersedes the Unsecured
Promissory Note, signed October 31, 2024, by the Company and
Coppermine. The principal of the New Note is $485,163. The New
Principal includes principal and interest accrued thereon under the
Old Note. As of February 4, 2025, $125,914 has been loaned to the
Company under the Old Note, and, on January 31, 2025, $53,018 was
loaned to the Company under the New Note.
"Coppermine's additional funding reflects Coppermine's continued
and essential support of Capstone's efforts to develop a new
business line," said Stewart Wallach, Chair of Company's Board of
Directors.
Purpose of New Note:
Company and Coppermine entered into the New Note to provide
projected funding needed by the Company to pay for essential
corporate maintenance expenses due in the first three fiscal
quarters of 2025, being expenses deemed necessary by the Company to
meet the reporting and filing requirements under federal and state
securities laws and regulations, maintenance of the quotation of
the Company's Common Stock on the OTC Markets Group QB Venture
Market and maintenance of directors' and officers' insurance and
basic management and accounting operations. The New Principal is
intended to provide sufficient working capital to maintain the
corporate existence of the Company while the executive management
continues efforts to develop or acquire a new business line or
revenue generating operation. The Company is a public shell and has
no revenue generating operations as of the date of the filing of
this Form 8-K and relies on third party funding to sustain its
corporate existence and efforts to develop or acquire a new
business line.
Use of Proceeds:
Under the New Note, the Company will request funding for the
payment of the projected essential corporate maintenance funding:
Public company compliance and regulatory expenses:
Quarter 1: $42,850
Quarter 2: $27,050
Quarter 3: $47,050
Total: $116,950
Accounting and legal expenses:
Quarter 1: $46,860
Quarter 2: $23,300
Quarter 3: $56,300
Total: $126,460
Insurance costs:
Quarter 1: $14,769
Quarter 2: $14,769
Quarter 3: $14,679
Total: $44,307
Software and operating expenses:
Quarter 1: $6,884
Quarter 2: $6,055
Quarter 3: $5,575
Total: $18,514
Projected working capital needs (through September 30, 2025):
Quarter 1: $111,363
Quarter 2: $71,174
Quarter 3: $123,694
Total: $306,231
The Company's actual funding needs for these essential operating
expenses may exceed the New Principal. Coppermine is under no
obligation to provide funding in excess of, and has not made, as of
the date of the filing of this Form 8-K with the Commission, any
commitment for funding in excess of, the New Principal. The New
Principal will also not fund development or acquisition of a new
business line for the Company.
Interest:
The principal under the New Note accrues interest at a simple
annual rate of 7%.
Lump Sum Payment:
The New Note provides for a lump-sum payment of New Principal and
interest accrued thereon, which imposes a substantial financial
burden on the Company.
Maturity:
Principal and accrued interest thereon under the New Note, which
includes the principal and interested accrued thereon under the Old
Note, are due and payable in a single lump sum due on December 31,
2025, unless occurrence of certain events causes (summarized in
Acceleration of Maturity below) causes all sums to become due prior
to December 31, 2025. The Company may pre-pay the New Principal and
interest accrued thereon without charge or penalty.
Acceleration of Maturity:
Under the New Note, the principal and interest accrued thereon
shall become due before December 31, 2025 if:
(1) Company files a voluntary bankruptcy petition;
(2) an involuntary bankruptcy petition is filed on the
Company;
(3) Company ceases to be a reporting company under the
Securities Exchange Act of 1934; or
(4) Company's Common Stock is not quoted on any tier to The
OTC Markets Group.
Unsecured Debt:
The debt owed under the New Note is not secured by any collateral
and there are no guarantors of that debt.
Payment of Debt:
As of February 4, 2025, the filing of the Form 8-K, the Company
does not have revenue-generating operations or sufficient cash
reserves to pay the New Principal and interest accrued thereon. If
the Company does not acquire or develop revenue generating revenues
by the maturity date, December 31, 2025, or by an accelerated due
date, then the Company would have to raise additional funding to
pay sums due under the New Note, restructure the payment of the
sums due under the New Note, or both, in order to avoid a default.
About Capstone Companies Inc.
Deerfield Beach, Fla.-based Capstone Companies, Inc. is a public
holding company organized under the laws of the State of Florida.
The Company is a designer, manufacturer and marketer of consumer
products that are designed to simplify daily living through
technology.
Margate, Fla.-based Assurance Dimensions, 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 operating losses, has incurred negative cash flows from
operations and has an accumulated deficit. These and other factors
raise substantial doubt about the Company's ability to continue as
a going concern.
As of September 30, 2024, Capstone Companies had $1,378,848 in
total assets, $4,102,475 in total liabilities, and $2,723,627 in
total stockholders' deficit.
CARVANA CO: BlackRock Reports 5.7% Equity Stake as of Dec. 31
-------------------------------------------------------------
BlackRock, Inc. disclosed in Schedule 13G Report filed with the
U.S. Securities and Exchange Commission that as of December 31,
2024, it beneficially owned 7,340,271 shares of Carvana Co.'s Class
A shares, representing 5.7% of the shares outstanding.
BlackRock may be reached at:
Spencer Fleming
BlackRock, Inc.
50 Hudson Yards
New York, NY 10001
Tel: (212) 810-5800
A full-text copy of BlackRock's SEC Report is available at:
https://tinyurl.com/45h492mk
About Carvana
Founded in 2012 and based in Tempe, Arizona, Carvana Co. --
http://www.carvana.com-- is an e-commerce platform for buying and
selling used cars. The Company is transforming the used car buying
and selling experience by giving consumers what they want, a wide
selection, great value and quality, transparent pricing, and a
simple, no pressure transaction. Each element of its business, from
inventory procurement to fulfillment and overall ease of the online
transaction, has been built for this singular purpose.
Carvana reported a net income of $150 million for the year ended
Dec. 31, 2023, compared to a net loss of $2.89 billion for the year
ended Dec. 31, 2022. As of June 30, 2024, Carvana had $7.17 billion
in total assets, $7.05 billion in total liabilities, and $115
million in total stockholders' equity.
* * *
Moody's Investors Service upgraded Carvana Co.'s corporate family
rating to Caa3 from Ca, the TCR reported on Sept. 22, 2023. Moody's
said the upgrade of Carvana's CFR to Caa3 reflects the completion
of its debt exchange that pushes out some near-term maturities,
reduces outstanding debt, and materially reduces cash interest
expense in the two years following the exchange.
In August 2024, S&P Global Ratings raised its issuer credit rating
on U.S.-based Carvana Co. to 'B-' from 'CCC+'. S&P said, "At the
same time, we raised our unsolicited issue-level rating on
Carvana's senior secured debt to 'B-' from 'CCC+' with a '4'
recovery rating (30%-50%; rounded estimate: 40%). We also raised
our issue-level rating on its senior unsecured debt to 'CCC' from
'CCC-' with a '6' recovery rating (0%-10%; rounded estimate: 0%).
"The stable outlook reflects our view that Carvana will continue
increasing EBITDA, generating positive free cash flow, and
maintaining leverage of 6x-7x over the next 12 months.
CATHETER PRECISION: Grants Incentive Stock Options to Executives
----------------------------------------------------------------
Catheter Precision, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that the Compensation
Committee of the Board of Directors awarded incentive stock option
grants to the following executive officers of the Company pursuant
to the Company's 2023 Executive Incentive Plan:
(1) David Jenkins, Chairman of the Board and Chief Executive
Officer
Mr. Jenkins received options to purchase 450,000 shares of Company
common stock at an exercise price of $0.42. The options have a term
of ten years and vest according to the following schedule:
* 90,000 shares vested on January 29, 2025
* 120,000 shares vest on January 29, 2026
* 120,000 shares vest on January 29, 2027, and
* 120,000 shares vest on January 29, 2028.
(2) Marie-Claude Jacques, Chief Commercial Officer
Ms. Claude received options to purchase 250,000 shares of Company
common stock at an exercise price of $0.42. The options have a term
of ten years and vest according to the following schedule:
125,000 options vest as follows:
* 20% vested on January 29, 2025
* 20% vest on January 29, 2026
* 20% vest on January 29, 2027
* 20% vest on January 29, 2028, and
* 20% vest on January 29, 2029.
An additional 125,000 options vest as follows:
* 25% vest on March 31, 2025 if Q1 2025 sales targets are
achieved
* 25% vest on June 30, 2025 if Q2 2025 sales targets are
achieved
* 25% vest on September 30, 2025 if Q3 2025 sales targets are
achieved, and
* 25% vest on December 31, 2025 if Q4 2025 sales targets are
achieved.
About Catheter Precision Inc.
Headquartered in the U.S., Catheter Precision, Inc. is a medical
device company focused on improving the treatment of cardiac
arrhythmias. The Company, which was reincorporated as Ra Medical
Systems, Inc. in Delaware in 2018 and changed its name to Catheter
Precision, Inc. on August 17, 2023, develops technology for
electrophysiology procedures through collaborations with physicians
and continuous product advancements.
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 recurring
operating losses and anticipated future losses that raise
substantial doubt about the Company's ability to continue as a
going concern.
For the year ended December 31, 2023, Catheter Precision reported a
net loss of $70.6 million, compared to a net loss of $26.9 million
for 2022. As of September 30, 2024, Catheter Precision had $26.7
million in total assets, $13.9 million in total liabilities, and
$12.8 million in total stockholders' equity.
CCA CONSTRUCTION: BML Properties Seeks Appointment of Examiner
--------------------------------------------------------------
BML Properties, Ltd. filed with the U.S. Bankruptcy Court for the
District of New Jersey a motion to appoint an independent examiner
in the Chapter 11 case of CCA Construction, Inc.
BMLP explains that it was awarded over $1.6 billion by a New York
court less than three months ago. The New York Court found, after a
trial spanning two weeks, that there was clear and convincing
evidence that CCA committed fraud. This entailed CCA diverting
resources for the construction of a resort in the Bahamas "to buy a
competing hotel development down the road" and conducting an
"absolute sham and shakedown" of BMLP to obtain $54 million to buy
that competing hotel.
Now in bankruptcy, CCA remains inextricably linked to its
affiliates and its Chinese state-owned parent, China State
Construction Engineering Corp. Ltd. (CSCEC). CCA has sought a DIP
loan from CSCEC Holding Company, Inc., its immediate parent and a
subsidiary of CSCEC, of up to $40 million on a secured,
super-priority basis, with the ability to make future draws outside
of any court-approved budget.
BMLP claims that CCA has been outspoken with the bankruptcy court
about its belief that "BMLP is not entitled to its money back" and
its confidence about its likelihood of success on appeal. This
hubris is remarkable in light of the 74-page post-trial decision
rejecting CCA's position, the deferential standard of review on
appeal, and the fact that, just days before making these
representations in its first day pleadings, the appellate court in
New York had denied CCA's motion for an unbonded stay of
enforcement pending appeal in which CCA argued it was likely to
succeed on appeal.
BMLP notes that CCA attempted to significantly restrict the time
period it was required to search documents and opposed the
deposition of Mr. Yan Wei, CCA's chief executive officer and
chairman, who submitted a declaration in support of CCA's first day
motions. CCA's counsel has also informed BMLP that, going forward,
any information would only be produced through formal discovery
processes, making it more difficult and costly for BMLP to obtain
information about CCA.
CCA's insistence that all future requests for information go
through formal discovery rather than freely disclosing the
information requested by the estate's largest creditor bespeaks the
level of obstruction that CCA, likely acting at the behest of
CSCEC, will impose on these proceedings. Rather than efficiently
providing information, CCA insists on making BMLP's efforts to
obtain information as complicated and costly as possible, according
to BMLP.
BMLP seeks the appointment of an independent examiner to
investigate, inter alia, the dealings between CCA and its nominal
affiliates to identify instances of fraud, dishonesty,
incompetence, misconduct, mismanagement, or irregularity in the
management of CCA's affairs in the lead up to, and throughout, this
Chapter 11 case.
Counsel for BML Properties, Ltd.:
Robert K. Malone, Esq.
Brett S. Theisen, Esq.
Christopher P. Anton, Esq.
Kyle P. McEvilly, Esq.
Gibbons P.C.
One Gateway Center
Newark, New Jersey 07102-5310
Telephone: (973) 596-4500
Email: rmalone@gibbonslaw.com
btheisen@gibbonslaw.com
canton@gibbonslaw.com
kmcevilly@gibbonslaw.com
About CCA Construction
CCA Construction Inc., doing business as China Construction America
Inc., ProServ Shared Services, and Plaza Construction, was
established in 1993 as a Delaware corporation, and it is a direct
subsidiary of CSCEC Holding Company, Inc., also a Delaware
corporation. CSCEC Holding, CCA, and CCA's subsidiaries are
discrete pieces of CSCEC's broader business, which is operated by
more than 100 distinct entities located throughout the world, eight
of which are publicly traded. Together, the group of affiliated
entities makes up the largest construction company in the world,
operating in more than 100 countries and regions globally, covering
investment, development, construction engineering, survey and
design.
CCA Construction Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D.N.J. Case No. 24-22548) on December 22,
2024. In the petition filed by Yan Wei, chairman and chief
executive officer, the Debtor reports reports estimated assets
between $100 million and $500 million and estimated liabilities
between $1 billion and $10 billion.
Honorable Bankruptcy Judge Christine M. Gravelle handles the case.
The Debtor tapped M. Natasha Labovitz, Esq., Sidney P. Levinson,
Esq., Elie J. Worenklein, Esq., and Rory B. Heller, Esq., at
Debevoise & Plimpton LLP, in New York as general bankruptcy
counsel; Michael D. Sirota, Esq., Ryan T. Jareck, Esq., Warren A.
Usatine, Esq., and Felice R. Yudkin, Esq., at Cole Schotz PC in
Hackensack, New Jersey as bankruptcy co-counsel; and BDO Consulting
Group, LLC as financial advisor. Kurtzman Carson Consultants, LLC,
dba Verita Global, is the administrative advisor.
CELSIUS NETWORK: Ionic Shareholders File Lawsuit for Board Docs
---------------------------------------------------------------
Emily Lever of Law360 reports that the shareholders of Ionic
Digital Inc., the company established to oversee the digital mining
assets of bankrupt Celsius Network LLC, have sued in Delaware's
Court of Chancery to obtain the company's stockholder lists.
The lawsuit is part of their effort to propose a competing slate of
directors, the report states.
About Celsius Network
Celsius Network LLC -- http://www.celsius.network/-- is a
financial services company that generates revenue through
cryptocurrency trading, lending, and borrowing, as well as by
engaging in proprietary trading.
Celsius helps over a million customers worldwide to find the path
towards financial independence through a compounding yield service
and instant low-cost loans accessible via a web and mobile app.
Celsius has a blockchain-based fee-free platform where membership
provides access to curated financial services that are not
available through traditional financial institutions.
The Celsius Wallet claims to be one of the only online crypto
wallets designed to allow members to use coins as collateral to get
a loan in dollars, and in the future, to lend their crypto to earn
interest on deposited coins (when they're lent out).
Crypto lenders such as Celsius boomed during the COVID-19 pandemic,
drawing depositors with high interest rates and easy access to
loans rarely offered by traditional banks. But the lenders'
business model came under scrutiny after a sharp sell-off in the
crypto market spurred by the collapse of major tokens terraUSD and
luna in May 2022.
New Jersey-based Celsius froze withdrawals in June 2022, citing
"extreme" market conditions, cutting off access to savings for
individual investors and sending tremors through the crypto
market.
The list of major crypto firms that have filed for bankruptcy
protection in 2022 now includes Celsius Network, Three Arrows
Capital and Voyager Digital.
Celsius Network, LLC and its subsidiaries sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case
No. 22-10964) on July 14, 2022. In the petition filed by CEO Alex
Mashinsky, the Debtors estimated assets and liabilities between $1
billion and $10 billion.
The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis
International, LLP as bankruptcy counsels; Fischer (FBC & Co.) as
special counsel; Centerview Partners, LLC as investment banker; and
Alvarez & Marsal North America, LLC as financial advisor. Stretto
is the claims agent and administrative advisor.
On July 27, 2022, the U.S. Trustee appointed an official committee
of unsecured creditors. The committee tapped White & Case, LLP as
its bankruptcy counsel; Elementus Inc. as its blockchain forensics
advisor; M3 Advisory Partners, LP as its financial advisor; and
Perella Weinberg Partners, LP as its investment banker.
Shoba Pillay, Esq., is the examiner appointed in the Debtors'
Chapter 11 cases. Jenner & Block, LLP and Huron Consulting
Services, LLC, serve as the examiner's legal counsel and financial
advisor, respectively.
* * *
On November 9, 2023, the Bankruptcy Court entered the Findings of
Fact, Conclusions of Law, and Order Confirming the Modified Joint
Chapter 11 Plan of Celsius Network LLC and Its Debtor Affiliates.
The Effective Date of the Plan occurred January 31, 2024.
CENTRAL HOUSEWARES: Gets Interim OK to Use Cash Collateral
----------------------------------------------------------
Central Housewares, Inc. got the green light from the U.S.
Bankruptcy Court for the Eastern District of Wisconsin to use its
secured creditors' cash collateral until March 7.
The interim order signed by Judge Katherine Maloney Perhach
authorized the company to use the cash collateral of Channel
Partners Capital, LLC and the U.S. Small Business Administration in
accordance with its budget.
To protect their interest, Channel Partners Capital and the SBA
will receive monthly payments of $1,219.98 and $2,484,
respectively, starting on Feb. 26.
To the extent the company uses the cash collateral of Atipana
Credit Opportunity Fund I, LP (doing business as Fundr), this
creditor will be granted a replacement lien on assets acquired by
the company after Jan. 27.
A final hearing is set for March 7. Objections are due by March 3.
About Central Housewares Inc.
Central Housewares, Inc. is a retailer of pools, spas, outdoor
living equipment, as well as billiards and other table games.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Wisc. Case No. 25-20408-kmp) on
January 27, 2025. In the petition signed by Jeffrey Desing,
president, the Debtor disclosed up to $1 million in assets and up
to $10 million in liabilities.
Judge Katherine M. Perhach oversees the case.
Paul G. Swanson, Esq., at Swanson Sweet, LLP, represents the Debtor
as legal counsel.
CHARTER COMMUNICATIONS: Fitch Affirms 'BB+' LongTerm IDR
--------------------------------------------------------
Fitch Ratings has affirmed the 'BB+' Long-Term Issuer Default
Ratings (IDRs) of Charter Communications, Inc. (Charter), Charter
Communications Operating, LLC (CCO), CCO Holdings, LLC (CCOH), Time
Warner Cable, LLC (TWC), and Time Warner Cable Enterprises LLC
(TWCE). The ratings reflect Charter's consistent leading position
as the largest multichannel video programming distributor (MVPD)
and the second-largest broadband connectivity company in the U.S..
The ratings also reflect its relatively successful operational
efforts and relative leverage. The Rating Outlook is Stable.
Charter's instrument and recovery ratings (RR) are assigned in
accordance with Fitch's "Corporates Recovery Ratings and Instrument
Ratings Criteria". Senior secured debt issued by CCO, TWC and TWCE
were rated 'BBB-' with a Recovery Rating of 'RR1'. Structurally
subordinated senior unsecured debt issued by CCOH were assigned a
'BB+'/'RR4' rating. More details on the secured issue level ratings
are available in the liquidity and debt structure section below.
Key Rating Drivers
Leading Market Position: Charter enjoys significant scale benefits
as the largest U.S. MVPD, with 31.5 million total customer
relationships as of Dec. 31, 2024, just behind Comcast Corp.
(A-/Stable). It became the largest U.S. linear video distribution
provider with 12.9 million customers by Dec. 31, 2024, surpassing
Comcast in 4Q23. Charter's operating strategies have resulted in
relatively lower customer losses compared to the overall industry
for several years.
Stable Credit Profile: As of Dec. 31, 2024, Charter had
approximately $93.8 billion in debt, including $66.5 billion in
senior secured debt. Fitch-calculated gross leverage was 4.2x,
within negative rating sensitivities, and secured leverage was
3.0x. Charter plans to continue opportunistically refinancing
near-term maturities and may issue additional debt to fund
shareholder returns using debt capacity created by EBITDA growth.
Total leverage is expected to approach the lower end of the
company's 4.0x-4.5x targeted leverage range over the rating
period.
FCF Growth Expected to Accelerate: FCF is expected to benefit from
reduced capex during the rating period, potentially doubling from
approximately $4.3 billion in 2024 to nearly $10 billion in 2028.
Annual FCF generation is expected to more than cover annual debt
maturities during the rating period.
"Life Unlimited" Expected to Boost Churn and Subscriber Growth: In
September 2024, Charter launched "Life Unlimited, " a unique cable
industry commitment offering fully reliable connectivity, same-day
on-site technical service, transparent pricing and service updates,
exceptional support service or product refunds, and continuous
improvements of network capacity. It includes a two-year price lock
for broadband bundles and a three-year price lock for mobile
services. Fitch expects this initiative to create a differentiated
customer experience, reducing churn and increase new broadband
subscribers.
Broadband Segment Poised to Return to Positive Net Additions:
Charter had approximately five million broadband subscribers
benefitting from the ACP, a federal subsidy program that ended in
May 2024. Charter successfully retained approximately 90% of these
subscribers on new plans. With the ACP impact diminishing, Charter
is expected to resume modest growth in broadband subscribers.
Video Segment Expected to Stabilize: Charter leads the industry
with innovative new carriage agreements with major programmers like
Disney and Warner Bros., offering video subscribers access to
ad-supported DTC platforms at no extra cost. These agreements add
up to almost $80 in value for customers. Although not expect to
grow the video subscriber base, they should reduce churn in this
segment.
Liberty Broadband Acquisition Expected to be Leverage-neutral:
Charter's planned acquisition of Liberty Broadband, its largest
Charter shareholder with approximately 26% equity, is on-track to
close in the first half of 2027. Liberty Broadband holds $2.62
billion in debt linked to its Charter stock. Charter's $100 million
monthly share repurchase plan aims to reduce this outstanding debt
balance, keeping the acquisition leverage-neutral at closing.
Derivation Summary
Charter is well positioned in the MVPD space, given its size and
geographic diversity. It is the largest U.S. cable MVPD with 31.5
million total customer relationships and is largest U.S. linear
video content distributor with 12.9 million customers.
Comcast Corp. is rated higher than Charter, primarily due to its
lower target leverage and actual total leverage, and significantly
greater revenue size, coverage area and segment diversification.
DIRECTV Entertainment Holdings LLC (BB/Stable) may lack Charter's
segment diversification, scale, growth prospects and FCF levels,
but has lower leverage and greater geographic diversification. It
also received a one-notch uplift from AT&T Corp.'s 70% economic
ownership after its spin-off.
Charter's ratings remain stable as the company plans to continue
issuing debt under additional debt capacity from EBITDA,
maintaining a target leverage range of 4.0x-4.5x. Fitch expects
proceeds from prospective debt issuance under this additional debt
capacity to be used for shareholder returns along with internal
investment and accretive acquisitions. No Country Ceiling or
parent/subsidiary aspects affect the rating.
Key Assumptions
- Revenue over the rating period is expected to be relatively flat
as wireless growth offsets near-term broadband pressures and
continued declines in the video and voice segments. Expect
broadband to begin to start adding subscribers in 2025 as the ACP
roll-off is complete.
- EBITDA growth slows but margins improve slightly, driven by
wireless platform improvement.
- Capex will remain elevated in 2025 but begin to decline
meaningfully beginning in 2026 due to an expected slowdown in new
line extensions and the expectation of major network evolution
spending to be completed by 2027.
- FCF is expected to more than double from approximately $4.3
billion in 2024 to nearly $10 billion in 2028. Annual FCF
generation is expected to more than cover annual debt maturities
during the rating period. The company is expected to continue using
the bulk of its FCF generation for share repurchase activity.
- Charter is expected to remain opportunistic in the capital
markets to refinance near-term maturities, with potential
additional issuance to fund shareholder returns using debt capacity
created by EBITDA growth. Total leverage is expected to approach
the lower end of the company's 4.0x-4.5x leverage range.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Weakening of its competitive position, as measured by accelerated
broadband subscriber losses;
- (CFO-capex)/debt not approaching 5.0% as the company's planned
capex is completed;
- EBITDA leverage sustained over 5.0x, possibly related to a more
aggressive financial policy.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- A strengthening operating profile as the company captures
sustainable revenue and cash flow growth, and the reduction and
maintenance of total leverage below 4.0x;
- (CFO-capex)/debt exceeding 10% on a sustained basis.
Liquidity and Debt Structure
Adequate Liquidity: Fitch regards Charter's liquidity position and
overall financial flexibility as satisfactory and believes it will
improve in line with the continued FCF growth. The company's
liquidity position at Dec. 31, 2024 included approximately $459
million of cash and $6.32 billion available under its two
revolvers; $960 million maturing in August 2027 and $5.5 billion
maturing in March 2030.
Charter's maturities through 2028 are manageable, with $2.1 billion
due in 2025, $2.2 billion in 2026, $3.6 billion in 2027, and $5.4
billion in 2028, inclusive of required term loan amortization.
Fitch expects the company to refinance a significant portion of
these upcoming maturities in line with its historical actions.
However, Fitch estimates Charter could choose to pay off all of
these maturities with expected internal free cash generation if
necessary.
CCO is the public issuer of Charter's senior secured debt. All of
CCO's existing and future secured debt is secured by a
first-priority interest in all of CCO's assets and is guaranteed by
all of CCO's subsidiaries, including those that hold the assets of
Charter, TWC, Bright House Networks, LLC and CCOH. CCOH is the
public issuer of Charter's senior unsecured debt and all of its
existing and future debt is structurally subordinated to CCO's,
TWC's and TWCE's senior secured debt and is neither guaranteed by
nor pari passu with any secured debt.
Recovery Analysis for Issuers Rated 'BB-' or Above: Charter's
instrument ratings and RRs are assigned in accordance with Fitch's
"Corporates Recovery Ratings and Instrument Ratings Criteria".
Under its generic approach for rating instruments of companies in
the 'BB' rating category, Fitch notches instruments against the IDR
and assigns RRs according to generic recovery assumptions derived
from historical performance data based on security and relative
priority.
For 'BB' category U.S. issuers with no major features that may
limit recovery, Fitch notches first-lien debt up to two notches
from the IDR, with a cap of 'BBB-', due to the significant recovery
percentages associated with an RR1. Charter's senior secured
issuance is assigned a 'BBB-'/'RR1' and benefits from a one-notch
uplift from the IDR, given its first-priority security position and
the 'BBB-' cap.
If Charter's IDR were downgraded to 'BB', the senior secured debt
is likely to remain 'BBB-', assuming there are no material changes
to the security package, increase in the senior secured debt or
other considerations Fitch considers when deciding between RR1 and
RR2 for first lien debt of 'BB' category issuers.
Charter is expected to continue combining a significant portion of
its robust FCF with debt issuance, using capacity created by EBITDA
growth for shareholder returns.
Issuer Profile
Charter is the largest U.S. cable MVPD and the second-largest
broadband connectivity company in the U.S. Fitch rates Charter
Communications, Inc., Charter Communications Operating, LLC, CCO
Holdings, LLC, Time Warner Cable, Inc. and Time Warner Cable
Enterprises, LLC, all indirect wholly owned subsidiaries of
Charter.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
CCO Holdings, LLC LT IDR BB+ Affirmed BB+
senior unsecured LT BB+ Affirmed RR4 BB+
Charter
Communications
Operating, LLC LT IDR BB+ Affirmed BB+
senior secured LT BBB- Affirmed RR1 BBB-
Time Warner Cable
Enterprises LLC LT IDR BB+ Affirmed BB+
senior secured LT BBB- Affirmed RR1 BBB-
Time Warner Cable,
LLC LT IDR BB+ Affirmed BB+
senior secured LT BBB- Affirmed RR1 BBB-
Charter
Communications, Inc. LT IDR BB+ Affirmed BB+
CHRYSSOULA ARSENIS: Court Tosses Foreclosure Case v. Blue Foundry
-----------------------------------------------------------------
Judge Robert Kirsch of the United States District Court for the
District of New Jersey granted Blue Foundry Bancorp's motion to
dismiss the complaint filed by pro se Plaintiffs Chryssoula,
George, and Spyridon Arsenis under Rule 12(b)(6) of the Federal
Rules of Civil Procedure.
The Complaint captioned as GEORGE ARSENIS, et al., Plaintiffs, v.
BLUE FOUNDRY BANCORP, Defendant, Case No. 24-cv-08978 (D.N.J.) is
dismissed with prejudice.
The present litigation arises from the same mortgage at issue in a
state foreclosure case removed twice by Plaintiffs to Judge Kirsch.
On Dec. 28, 2023, Chryssoula Arsenis -- along with her
co-Plaintiffs, George and Spyridon Arsenis -- removed a state
foreclosure action initiated by Blue Foundry Bank against
Plaintiffs ("Blue Foundry Bank I").
The Arsenises executed an Adjustable Rate Note, dated August 28,
2013, in the original principal amount of $4,073,555. The
Arsenises' debt has continued to accrue from September 2013 to
date.
To secure performance of the loan and repayment of the Note, the
Arsenises executed and delivered a mortgage, dated August 28, 2013,
which encumbered the real property designated as Block 16, Lots 5
and 6.01 on the tax map of the Borough ofBernardsville, Somerset
County, New Jersey, more commonly known as 380 Claremont Road,
Bemardsville, New Jersey 07924.
The Note and Mortgage obligated the Arsenises to make monthly
payments to Blue Foundry Bank. From Oct. 1, 2020 to date, the
Arsenises have failed to make the required payments due under the
Note and the Mortgage, resulting in a declaration of default and
the entire amount due and owing.
A few months later, on Jan. 14, 2021, Defendant Blue Foundry
Bancorp first came into existence.15 On July 15, 2021, Blue Foundry
Bank became the wholly owned subsidiary of this
new entity16 when Blue Foundry Bank's mutual holding company, Blue
Foundry, MHC, converted to a stock holding company. Thus, the
named Defendant Blue Foundry Bancorp serves as both the parent and
holding company of Blue Foundry Bank.
On Sept. 26, 2022, Blue Foundry Bank initiated an action for
foreclosure and possession against Plaintiffs in the Superior Court
of New Jersey, Chancery Division, Somerset County, No. F-010245-22.
As of that date, the amount due and owing included the principal
sum of $3,493,771.50, plus unpaid interest accruing at a rate of
3.875% per annum, taxes, late fees, and other costs and fees.
On Aug. 20, 2024, a mere eight days after the undersigned denied
George Arsenis's motion to stay the execution of the remand order
in Blue Foundry Bank I, Chryssoula and George Arsenis re-removed
the exact same foreclosure action as a new matter before Judge
Kirsch ("Blue Foundry Bank II").
On Sept. 4, 2024, in the midst of the Blue Foundry Bank II remand
proceedings, Chryssoula, George, and Spyridon Arsenis filed the
subject Complaint against Blue Foundry Bank's holding and parent
company, Blue Foundry Bancorp, invoking the Court's subject matter
jurisdiction under 28 U.S.C. Secs. 1331 and 1332.19 Plaintiffs
plead five claims arising from the same mortgage at issue in the
state foreclosure action and Blue Foundry Bank I and II. They
allege violations of the Coronavirus Aid, Relief, and Economic
Security ("CARES") Act, 15 U.S.C. Sec. 9001, et seq. (Count I);
violations of the National Banking Act (Count II); bad faith and
unfair dealing (Count III); violations of the Truth in Lending Act
("TILA") (Count IV); and violations of the Fifth Amendment's Due
Process Clause (Count V). In this case, the Arsenises seek
$127,700,000.00 in statutory and punitive damages.
The essence of Plaintiffs' claims center on a purported Forbearance
and Modification Agreement which they claim was offered to them on
or about April 1, 2022, in connection with their Blue Foundry Bank
mortgage. They allege that Blue Foundry Bank did not adequately
disclose the true nature of the modification terms and failed to
properly implement
the forbearance provisions. Plaintiffs also assert that the Bank's
actions, especially during the COVID-19 pandemic, deprived them of
a fair opportunity to negotiate the terms of the modification,
effectively coercing them into an agreement under duress and
without their informed consent.
Rulel2(b)(6)
Defendant Blue Foundry Bancorp moves to dismiss the Complaint under
Rule 12(b)(6), arguing that it is not a party to the mortgage at
issue in this case. The Court finds that dismissal of the Complaint
is appropriate on this basis.
Plaintiffs appear to assert that Blue Foundry Bank and its holding
company, Defendant Blue Foundry Bancorp, are intertwined due to the
nature of their operations. They contend that Defendant Blue
Foundry Bancorp is liable for the actions of its subsidiary, Blue
Foundry Bank, simply because Blue Foundry Bank is its subsidiary.
The Court disagrees.
According to the Court, Plaintiffs have pled no facts to suggest
that Blue Foundry Bancorp -- a holding company that is otherwise
uninvolved in the day-to-day operations of its bank -- could be
held liable for any alleged conduct in connection with the Note and
Mortgage.
Because Plaintiffs cannot plead a claim for relief against
Defendant simply because it is Blue Foundry Bank's holding company,
the Court dismisses the Complaint.
Federal Causes of Action
In addition, in assessing the merits of their claims, the Court
finds Plaintiffs fail to adequately plead any of their federal
causes of action.
In Count I, Plaintiffs nakedly and disjointedly assert that the
CARES Act was designed to provide relief during the CO VID-19
pandemic and that Blue Foundry Bank's failure to provide further
loss mitigation options despite Plaintiffs' financial hardship
could have caused significant financial damage.
The Court dismisses Plaintiffs' CARES Act claim (Count I).
According to the Court, Plaintiffs make no effort to pinpoint which
title of the CARES Act is relevant to their case. They also fail to
establish that any such provision would entitle them to relief or
otherwise give them a private right of action.
Similarly, Plaintiffs' National Banking Act claim (Count II) must
fail as the National Banking Act also does not confer a right of
action upon private parties. The Court also declines to exercise
supplemental jurisdiction over Plaintiffs' common law claim for bad
faith and unfair dealing (Count III).
In Count IV, Plaintiffs seek relief under the TILA, but that claim
is untimely, according to the Court. Although an individual may
bring a private cause of action under the TDLA, a plaintiff must
bring the action within one year of the closing date of the loan.
Count V also fails because the Fifth Amendment's Due Process Clause
applies to and restricts only the Federal Government and not
private persons, and does not act against a private company, the
Court concludes.
Dismissal Without Leave to Amend
The Court finds, in its discretion, that dismissal without leave to
amend is appropriate.
The Court concludes that Plaintiffs' history of disregard for its
directives constitutes bad faith and warrants dismissal of the
Complaint without leave to amend.
The Amended Complaint is stricken. George Arsenis's Motion for
Reconsideration is denied as moot.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=hTJgaq from PacerMonitor.com.
Chryssoula Arsenis sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D.N.J. Case No. 24-21859).
COGENTRIX FINANCE: S&P Assigns Prelim BB- (sf) Rating on New Debts
------------------------------------------------------------------
S&P Global Ratings assigned its preliminary 'BB-' issue ratings and
'2' recovery ratings to Cogentrix Finance Holdco I LLC's
(Cogentrix, the Holdco or the project) proposed $ 1 billion term
loan B and $250 million revolving credit facility. The preliminary
rating is subject to its review of the terms and conditions of the
final issuance documents.
Cogentrix is looking to consolidate its four separate portfolio
projects, Nautilus Power LLC (Nautilus), Odyssey Projects Acquiror
LLC (Odyssey), Revere Power LLC (Revere), and its 75% ownership in
Hamilton Projects Acquiror LLC (Hamilton), and use the proposed
loan to repay existing subsidiary debt at Nautilus, Revere, and
Odyssey. Hamilton's debt will remain outstanding. This financing
follows the acquisition of Cogentrix Energy by Quantum Capital
Group, Trafigura and Carnelian Energy Capital from funds managed by
Carlyle Group.
S&P said, "Our 'BB-'rating reflects creditworthiness of Cogentrix
as a more diversified project among its peers, with multiple assets
in three distinctive markets: Pennsylvania-New Jersey-Maryland
(PJM) Interconnection, ISO-New England (ISO-NE), and Electric
Reliability Council of Texas (ERCOT). At the same time, we note the
75% stake in Hamilton will remain encumbered because its senior
secured debt will remain outstanding. We view this as a structural
weakness.
"The stable outlook reflects our expectation that the project will
generate a minimum debt service coverage ratio (DSCR) of 1.48x on a
fully consolidated basis through its life, including the
post-refinancing period (2032-2045). At the Holdco level, we
project a minimum DSCR of 1.59x, which we also view as commensurate
with the rating. Additionally, it reflects the outlook of the
project's material counterparty, Hamilton, which caps Cogentrix's
debt's rating because Hamilton distributions are material to
Cogentrix. Based on our view of the current market environment, we
project a Cogentrix Holdco-level term loan B balance of about $500
million at maturity in 2031."
Cogentrix is a portfolio of gas-fired generation with net
operational capacity of 5.3 gigawatts (GW) located in the PJM
Interconnection, ISO-NE, and ERCOT markets. The portfolio has a mix
of baseload and peaking facilities across the dispatch stack. Its
four generation subsidiaries collectively own 11 power plants
comprising:
-- Nautilus (net 1.9 GW) is a portfolio of two baseload combined
cycle gas turbines (CCGTs) and two peaking facilities located in
the PJM Eastern Mid-Atlantic Area Council zone and ISO-NE.
-- Hamilton (net 1.3 GW) has two CCGTs in the PJM Mid-Atlantic
Area Council (MAAC) zone, which are in the eastern portion of the
Marcellus shale gas play with access to reliable natural gas
supply.
-- Odyssey (net 856 MW) is a portfolio of two CCGTs that sells
power into the ERCOT energy-only merchant power market within the
Houston zone. One of its assets, Altura Cogen, is adjacent to
Lyondell Chemical Co. (LCC) and sells steam and a portion of its
electricity to LCC exclusively under a long-term contract.
-- Revere (1.1 GW) is a portfolio of three CCGTs within ISO-NE.
-- The highly diversified project with 11 assets across three
markets provides a key differentiation compared with single-asset
facilities due to market diversification and operational redundancy
that mitigates against potential event risks.
-- The PJM fleet benefits from both highly competitive dispatch
(Hamilton) and potential upside from future capacity auctions
(Nautilus PJM assets).
-- ERCOT is supportive of gas-fired plants with access to cheap
fuel. In recent years, power generators were able to realize higher
spark spreads due to extreme weather events.
-- Dual-fuel capabilities at key ISO-NE assets and strong
winterization among the PJM fleet provide added flexibility during
extreme weather events.
-- Hamilton's creditworthiness serves as a cap to S&P's debt
rating on Cogentrix due to its material 25% contribution to
Cogentrix's debt servicing.
-- The consolidated creditworthiness also serves as a cap to S&P's
debt rating on Cogentrix because it looks through the lens of full
Hamilton consolidation.
-- S&P views Opco Revere's past operating challenges as a risk
without an improvement in market conditions.
-- Energy transition is a tangible, although long-dated, risk
factor given the operating profile and competitive characteristics
of the majority of the portfolio.
-- Consistent with other merchant projects financed with term loan
B structures, Cogentrix is exposed to market and refinancing risk.
S&P said, "Our 'BB-' rating on Cogentrix reflects its
creditworthiness on a fully consolidated basis. Cogentrix proposed
to raise $1.25 billion in senior secured financing at the Holdco
entity following the consolidation of its four separate portfolio
projects, Nautilus, 75% of Hamilton, Odyssey, and Revere. The
financing includes $1 billion in term loan B, proceeds of which it
used to repay existing subsidiary debt at Nautilus ($522 million
outstanding), Revere ($468 million outstanding) and Odyssey ($7
million outstanding), pay a onetime sponsor distribution ($35
million), pay transaction fees and expenses ($25MM), and for
general corporate purposes. The proposed transaction also includes
access to a $250 million revolving credit facility. On an
unconsolidated basis, we consider the cash flows generated from
Revere, Nautilus, Odyssey, and its 75% share of distributions from
Hamilton, while excluding its debt. This leads to a minimum DSCR of
1.59x through its 2045 asset life, including the post-refinancing
period.
"We also look at the portfolio on a fully consolidated basis as a
test of the project's ability to cover the combined project's total
debt service. This results in a minimum DSCR of 1.48x, which we
also view as commensurate with a 'bb-' rating. As a result, the
Holdco and consolidated stand-alone credit profile (SACP) are the
same. We will continue monitoring both the Holdco and consolidated
DSCR (because it could cap the rating if its consolidated metrics
deteriorate).
"Hamilton's creditworthiness caps our rating on Cogentrix, while
its partial pledge creates structural protection weakness. We view
the distribution from Hamilton as an important component to
Cogentrix's debt servicing, making Hamilton a material counterparty
that caps our rating on the project. We expect distribution from
Hamilton to make up about 25% of Cogentrix's cash flow available
for debt service (CFADS) with some level of stability and moderate
resiliency. Hamilton's efficient base load assets have a history of
adequate operation and ability to capture adequate spark spread
under favorable hedges. The distribution is only paid to Cogentrix
after Hamilton meets all its obligations (operating, maintenance,
debt service, and other) and distribution test of 1.1x.
"At the same time, Cogentrix's lenders only benefit from Hamilton's
equity pledge because the physical assets have been secured for the
benefit of Hamilton's senior secured lenders. We view this partial
security as a structural protection weakness and reflect such
weakness through a negative structural protection notch.
"Debt paydown is key for our rating of Cogentrix under both
consolidated and unconsolidated consideration. The proposed
transaction at the Holdco largely replaces debt at Revere and
Nautilus, both of which experienced financial and operation
challenges in the past. The 75%-owned Hamilton remains encumbered
at $654 per kilowatt (/kW), which we view as somewhat more
leveraged within the peer group after its May 2024 upsizing.
"Consolidating Hamilton's $1.115 billion senior secured debt, the
proposed transaction leads to moderate $415/kW debt sizing on
consolidated basis. We view the unencumbered Odyssey cash flow as
an additional cushion to the downside and continue to expect
deleveraging via the sweep structures for the consolidated debt in
order to maintain the rating. Additional upsizing at the Hamilton
or Holdco level alongside an equity distribution could indicate
financial policy risk."
The multiportfolio project benefits from three distinctive markets.
Cogentrix is one of the more diversified projects among its peers,
with 51% net capacity in PJM, 33% in ISO-NE, and 16% in ERCOT. The
distinctive dynamics among these markets mitigate concentration and
event risks. In addition, having multiple assets in each market
reduces service interruption risks.
S&P said, "We factor the 11 assets into a positive performance
redundancy assessment under performance risk. The assets have not
experienced major operation issues during past severe weather
events, and Cogentrix also has fuel diversity--Newington (ISONE)
and Lakewood (PJM) are dual-fueled with sufficient storage,
allowing them to run on both gas and ultra-low-sulfur diesel when
the market is in need. We believe the assets are positioned to
capture potential market upside."
Cogentrix should benefit from a favorable environment in PJM. On
Jan. 28, 2025, Pennsylvania Governor Josh Shapiro reached an
agreement with PJM to settle his recent complaint about capacity
auction rules, which sets a price cap of $325 per megawatt-day
(/MW-day) and floor price of $175/MW-day for the next two auctions
(2026/2027 and 2027/2028 auction). The price cap/floor agreement is
subject to review by PJM stakeholders and its board. S&P expects
capacity price to result in $250/MW-day for the 2026/27 auction,
$225/MW-day for the 2027/28 auction, and $175/MW-day for the
2028/2029 auction.
The direction of the next two auctions is driven by industrial
onshoring, data center growth, electrification, and retirement of
less efficient thermal units. On Nov. 25, 2024, the PJM added 1.8
GW to its 2025 load forecast and increased 2030 forecasts by 17 GW.
S&P continues to expect capacity price to mean revert from this
high level as supply and demand reach equilibrium, though at higher
level than we previously expected.
S&P expects power prices to also benefit from this dynamic in at
least the near term due to the lack of new baseload power plants
coming online to replace the retired firm supply. In the midterm,
potential tariffs on China would hinder the cost of renewable new
builds. This would be an additional favorable credit factor for
existing thermal units on top of reliability focus, the long
approval process for new thermal plants, and power demand surge.
Cogentrix has about 60% and 40% capacity running as baseload and
peaking facilities, respectively, and 67% of capacity dispatching
in PJM and ERCOT. We expect Cogentrix could capture the potential
tailwind.
ISO-NE remains a challenging market. The market continues to be in
a state of power oversupply. In addition, the gas supply dynamic
may worsen in winter as Independent Electricity System Operator
(IESO) and Hydro Quebec are expecting higher winter heating demand,
limiting the amount to be exported to ISO-NE going forward. S&P
said, "Under this dynamic, we believe the dual-fueled Newington has
a more favorable dispatch at an average annual spark of $18 per
megawatt hours (/MWh) during the asset life to 2045 compared with
Revere assets, which had more operation challenges in the past and
has a portfolio average annual spark of about 13/MWh under the same
asset life. We expect the diversified portfolio to compensate with
potential market upside from PJM and ERCOT."
The portfolio is exposed to merchant power risk, particularly in
the ERCOT market. ERCOT is an energy-only market that has
aggressive renewable buildout and a history of severe weather
events, and Cogentrix's ERCOT portfolio (Odyssey) is expected to
contribute about 20% of Holdco cash flow. Odyssey assets sell 70%
of its net capacity in the merchant market, subjecting it to high
market volatilities.
Texas has seen a net decrease in flexible generation capacity in
the last decade along with high renewable penetration of 27% and
anticipated renewable load growth of 6.50%-6.75%. In 2023, Texas
intraday wind power generation varied between 62.5% of all ERCOT
electricity production to only 3.1%. Translating that to power
price, the intraday power price shifted from $7/MWh to close to a
$5,000/MWh price cap. The market continues to anticipate regional
load growth to outpace installed capacity for the next 10 years,
driven by AI infrastructure growth, liquefied natural gas exports
growth along the Gulf Coast, and electric vehicle penetration. With
the lack of long duration battery storage technology, firm power is
required to plug in the supply.
ERCOT took measures in 2023 to increase grid reliability and lower
energy cost, such as the Performance Credit Mechanism and
Dispatchable Reliability Reserve Service, but the details and
implementation timeline has not yet finalized. The on-time
disbursement of the low-cost Texas Energy Fund in 2025 will
incentivize about 9.8 GW of new firm power builds, which puts
marginal downward pressure on ERCOT's power price in the midterm.
However, it could also increase gas prices through higher demand
and put upward pressure on power price.
S&P said, "We expect the high volatility in ERCOT to continue with
upside potential during the forecast period. Odyssey assets are
located in the premium ERCOT Houston zone. Its 70% merchant
exposure enables it to capture the prices peaks, when the 30%
contracted and hedged capacity offers a source of stability by
covering about 50% of the portfolio's fixed and major maintenance
costs. The contract is an exclusive steam and electric power sales
agreement signed with a LyondellBasell Industries N.V. subsidiary
that runs the world largest propylene oxide tertiary butyl alcohol
plant. The relation started in early 2000s, and we expect the
contract to remain for the rest of the asset life (2045). On
normalized basis, we expect Odyssey to realize average asset life
spark spread of $23/MWh from the merchant market, contributing
about 20% of total asset life cash flow.
"We expect final credit agreements will address anti-filing
mechanisms. We assume the final credit agreements will include
language relating to anti-filing mechanisms, effectively delinking
the credit quality of the project from that of the parent.
"The stable outlook reflects our expectation that the project will
generate a minimum DSCR of 1.48x on a consolidated basis through
its life, including the post-refinancing period (2032-2045). At the
Holdco level, we project a minimum DSCR of 1.59x, which we also
view as commensurate with the rating. Additionally, it reflects the
outlook of the project's material counterparty, Hamilton, which
caps our debt rating on Cogentrix. Based on our view of the current
market environment, we project a Cogentrix Holdco-level term loan B
balance of about $500 million at maturity in 2031."
S&P could lower its rating on Cogentrix's debt if:
-- S&P believes the project is unable to maintain a minimum
consolidated and Holdco minimum DSCR of 1.4x on a sustained basis.
This could result from lower-than-expected capacity factors, weaker
energy margins, downward pressure on capacity prices, and
operational issues.
-- The project's cash flow sweeps are materially lower than S&P's
forecast, which would lead to a higher-than-expected debt balance
at maturity and weaker minimum DSCR.
S&P lowers its issuer credit rating on Hamilton, which caps its
rating on Cogentrix.
S&P could raise the rating on Cogentrix's debt if consolidated and
Holdco minimum DSCR reaches 1.8x on sustained basis and it raises
the rating on Hamilton. This outcome would largely be a function of
highly favorable business conditions, which would lead to widening
spark spreads or higher-than-expected capacity pricing.
COLIANT SOLUTIONS: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: CoLiant Solutions, Inc.
2703 Brickton North Drive
Buford GA 30518
Business Description: The Debtor offers safety and security
services to retailers and construction sites
nationwide by installing security and fire
alarm systems. Wal-Mart is the Debtor's
largest client, accounting for 50% of its
business. Other customers include
construction contractors, food and beverage
retailers like Duncan Brands, and department
stores like Dillard's. The Debtor has
physical office locations in Springfield,
Illinois, Bentonville, Arkansas, Modesto,
California, and Buford, Georgia.
Chapter 11 Petition Date: February 12, 2025
Court: United States Bankruptcy Court
Northern District of Georgia
Case No.: 25-51509
Debtor's Counsel: William Rountree, Esq.
ROUNTREE, LEITMAN, KLEIN & GEER, LLC
2987 Clairmont Road Suite 350
Altanta GA 30329
Tel: 404-584-1238
Email: wrountree@rlkglaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Kenneth C. Stallings as president.
A full-text copy of the petition, which includes a list of the
Debtor's 20 largest unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/HQKIBHQ/CoLiant_Solutions_Inc__ganbke-25-51509__0001.0.pdf?mcid=tGE4TAMA
COMMSCOPE HOLDING: Completes $2.1B Sale of OWN and DAS Businesses
-----------------------------------------------------------------
CommScope Holding Company, Inc., filed a Form 8-K with the
Securities and Exchange Commission, announcing the completion of
its previously disclosed sale of its Outdoor Wireless Networks
business segment (OWN), as well as the Distributed Antenna Systems
business unit of its Networking, Intelligent Cellular & Security
Solutions segment (DAS) to Amphenol Corporation. In accordance
with the Purchase Agreement dated July 18, 2024, Amphenol acquired
the OWN Business and the DAS Business on a cash-free, debt-free
basis, in exchange for approximately $2.1 billion in cash, subject
to certain adjustments.
The proceeds from the sale of the OWN Business and the DAS Business
will be used to pay fees and expenses associated with the
transactions and to repay all outstanding amounts under the
Company's asset-backed revolving credit facility, to repay in part
the Company's 4.750% Senior Secured Notes due 2029 and to repay in
full the Company's 6.000% Senior Secured Notes due 2026. In
connection with the repayment of all outstanding amounts under the
Company's asset-backed revolving credit facility, the committed
amount thereunder will be reduced to $750.0 million, subject to
borrowing base limitations. Following the consummation of the Debt
Repayment, the Company expects that the conditions precedent will
be met for a 25 basis point reduction in the applicable margin on
the Company's Senior Secured Term Loan.
About CommScope Holding
Headquartered in Hickory, North Carolina, CommScope Holding
Company, Inc. -- https://www.commscope.com -- is a global provider
of infrastructure solutions for communication, data center, and
entertainment networks. The Company's solutions for wired and
wireless networks enable service providers, including cable,
telephone, and digital broadcast satellite operators, as well as
media programmers, to deliver media, voice, Internet Protocol (IP)
data services, and Wi-Fi to their subscribers. This allows
enterprises to experience constant wireless and wired connectivity
across complex and varied networking environments.
CommScope reported a net loss of $1.45 billion in 2023, a net loss
of $1.28 billion in 2022, a net loss of $462.6 million in 2021, and
a net loss of $573.4 million in 2020.
* * *
As reported by the TCR on Jan. 13, 2025, Moody's Ratings placed
CommScope Holding Company, Inc.'s ratings on review for upgrade,
including its Caa2 corporate family rating and Caa3-PD probability
of default rating. Moody's said that CommScope's ratings were
placed on review for upgrade as the transactions allow the company
to address all near term debt maturities and provide additional
time to reduce the company's extremely high leverage levels (over
11x pro forma for the impact of the pending OWN and DAS asset sale,
including Moody's lease adjustments), although interest rates will
increase significantly as a result of the transaction.
As reported by the TCR on Nov. 22, 2023, S&P Global Ratings lowered
its Company credit rating on CommScope to 'CCC' from 'B-' and
removed the ratings from CreditWatch with negative implications,
where they were placed on Oct. 31, 2023. S&P revised the outlook
to negative. The negative outlook reflects S&P's view that
CommScope's expected weak financial performance, with leverage
above the 10x area and low FOCF generation in 2023 and 2024, will
increase the risk of a distressed exchange or buyback within the
next 12 months to address upcoming maturities.
COMMSCOPE HOLDING: S&P Upgrades ICR to 'CCC+', Outlook Stable
-------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on CommScope
Holding Co. Inc. to 'CCC+' from 'CCC' and removed all its ratings
on the company from CreditWatch, where S&P placed them with
positive implications on Dec. 23, 2024.
S&P said, "At the same time, we raised our issue-level rating on
CommScope's secured debt to 'B-' from 'CCC+' and our issue-level
rating on its unsecured debt to 'CCC' from 'CCC-'. Our '2' recovery
rating on the company's secured debt and '5' recovery rating on its
unsecured debt are unchanged.
"We also assigned our 'B-' issue-level rating and '2' recovery
rating to CommScope's new $3.15 billion secured term loan due 2029
and $1 billion secured notes due 2031.
"The stable outlook reflects our expectation for reduced default
risk over the next 12 months due to the company's recent debt
paydown and refinancing and improving credit metrics."
CommScope Holding Co. Inc. recently received the proceeds from its
divestiture of OWN/DAS, which it used to repay its 2026 secured
notes. Following this paydown, the company's nearest debt maturity
is now in 2027.
S&P Global Ratings also expects CommScope will benefit from
improving end-customer demand across all of its segments such that
it will boost its credit metrics over the next year.
S&P said, "While CommScope's ability to manage its capital
structure remains somewhat unclear, we now expect revenue growth
and improving EBITDA margins will reduce its leverage in 2025. The
company's business operations across all of its segments were
hampered for the first three quarters of 2024. However, in the
fourth quarter of 2024, we saw the market demand increase for
datacom products from others in this space and expect CommScope to
have benefited as well in the fourth quarter. Due to the elevated
investments by hyperscalers in artificial intelligence (AI)
datacenters, which need significantly more components than
traditional datacenters, CommScope is expected to benefit from
robust demand for its datacenter solutions. The strong demand for
the company's datacom products is anticipated to help increase its
expected revenue year over year in the fourth quarter of 2024.
However, we believe CommScope's strong expected fourth-quarter
revenue will not be sufficient to offset the declines it
experienced during the first three quarters of 2024.
"That said, we believe the company will likely experience improved
demand across all its segments in 2025. We expect that CommScope's
Connectivity and Cable Solutions (CCS) segment will benefit from a
very strong increase in its revenue in 2025 because of continued
robust datacom demand and on rising demand from its telecom
customers as their inventory normalizes. The company's Access
Network Solutions (ANS) business will likely also benefit from
rising revenue on anticipated network updates in 2025. Lastly, we
believe CommScope's Network Intelligent Cellular and Security
Solutions (NICS) will benefit from a strong increase in its revenue
amid normalizing inventory levels in 2025. Given these factors, we
expect the company will expand its organic revenue by almost 20% in
2025.
"We anticipate CommScope will likely also improve its EBITDA
margins, supported by the roll off of one-time costs and increased
operating leverage, to the 19%-21% range in 2025. Due to the
company's strong expected revenue and EBITDA expansion, we now
expect it will reduce its leverage to the low-9x area in 2025
(incorporating the $1.2 billion of convertible preferred stock that
we treat as debt due to the holders' ability to redeem it for cash
in October 2027; high-7x area without the preferred equity).
"The stable outlook reflects our expectation that CommScope will
face reduced default risk over the next 12 months because its debt
paydown and refinancing have pushed out its closest debt maturity
to 2027. In addition, the company has improved its credit metrics,
supported by the strong demand for its datacom products and the
roll off of certain one-time costs.
"We could lower our rating on CommScope if we anticipate an
elevated risk of default on its mandatory debt obligations or
believe it will undertake a distressed exchange over the next 12
months due to a worse-than-expected operating performance on weak
end-customer demand, a disruption to its business operations, or
elevated macroeconomic or market-specific volatility.
"We could upgrade CommScope if we believe it can sustain its
leverage below the 8x area (incorporate its preferred equity that
we treat as debt) through the trough of its volatile end-markets,
generate reported FOCF of more than $200 million, and demonstrates
path toward refinancing its 2027 debt maturities and addressing its
2027 preferred equity. This could occur if the company's
end-customer demand improves significantly and the roll off of
one-time costs supports an improvement in its EBITDA and FOCF
generation."
COMPAC USA: Brayton & Shraiberg Advise Silicosis Claimants Group
----------------------------------------------------------------
The Ad Hoc Silicosis Claimants Group formed in the Chapter 11 case
of Compac USA Inc., filed a verified statement pursuant to Rule
2019 of the Federal Rules of Bankruptcy Procedure.
On or around January 2025, the Ad Hoc Silicosis Claimants group was
formed. Prior to the Ad Hoc Silicosis Claimants Group's formation,
the members had each retained Brayton Purcell LLP to represent each
member in litigation against the Debtor arising out of the member's
development of accelerated silicosis resulting from the
individual's work in stone fabrication shops.
Subsequently, Brayton Purcell contacted Shraiberg Page P.A. to
serve as bankruptcy counsel to each member of the Ad Hoc Silicosis
Claimants Group.
Shraiberg Page and Brayton Purcell do not represent or purport to
represent any other entities in connection with the Debtor's
chapter 11 cases. Shraiberg Page and Brayton Purcell do not
represent the Ad Hoc Silicosis Claimants Group as a "committee" (as
such term is used in the Bankruptcy Code and Bankruptcy Rules) 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 Shraiberg Page
and/or Brayton Purcell.
In addition, the Ad Hoc Silicosis Claimants Group does not
represent or purport to represent any other entities in connection
the Debtor's chapter 11 case. Each member of the Ad Hoc Silicosis
Claimants Group does not represent the interests of, nor act as a
fiduciary for, any person or entity other than itself in connection
with the Debtor's chapter 11 case.
Shraiberg Page does not hold any disclosable economic interests (as
that term is defined in Rule 2019(a)(1)) in relation to the Debtor.
Brayton Purcell's agreements with the members of the Ad Hoc
Silicosis Claimants Group include standard contingency fee
provisions.
Each member of the Ad Hoc Silicosis Claimants Group holds an
unliquidated claim against the Debtor based on the member's
development of silicosis. To protect the claimants' privacy, their
addresses have been omitted from this disclosure.
Attorneys for the Ad Hoc Silicosis Claimants Group:
SHRAIBERG PAGE P.A.
John Page, Esq.
Samuel Hess, Esq.
2385 NW Executive Center Drive, Suite 300
Boca Raton, Florida 33431
Telephone: 561-443-0800
Facsimile: 561-998-0047
Email: jpage@slp.law
Email: shess@slp.law
BRAYTON PURCELL, LLP
Bryn Letsch, Esq.
222 Rush Landing Road
PO Box 6169
Novato, CA 94948-6169
Telephone: 415-898-1555
Facsimile: 415-898-1247
E-mail Address: bletsch@braytonlaw.com
About Compac USA Inc.
Compac USA Inc. is a Florida entity incorporated in 2002 to market
and sell Compac stone products. The Debtor specializes in obsidian,
terrazzo, and quartz surfaces for architecture and design. It
maintains showrooms in Miami, Florida and New York, New York.
Compac USA sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. S.D. Fla. Case No. 24-23372) on Dec. 21, 2024.
Francisco A. Sanchis-Brines, president of Compac USA, signed the
petition.
As of Nov. 24, 2024, Compac USA reported total assets of $5,342,926
and total liabilities of $739,872.
Judge Corali Lopez-Castro handles the case.
The Debtor is represented by Joseph A. Pack, Esq. at Pack Law.
CONROE CORRAL: Files Chapter 11 Bankruptcy in Texas
---------------------------------------------------
On February 7, 2025, Conroe Corral Murphy LLC filed Chapter 11
protection in the U.S. Bankruptcy Court for the Southern District
of Texas.
According to court filing, the Debtor reports $1,080,496 in
debt owed to 1 and 49 creditors. The petition states funds will be
available to unsecured creditors.
About Conroe Corral Murphy LLC
Conroe Corral Murphy LLC operates within the restaurant industry.
Conroe Corral Murphy LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Case No.: 25-30765) on February
7, 2025. In its petition, the Debtor reports estimated liabilities
of $1,080,496.
Honorable Bankruptcy Judge Jeffrey P. Norman handles the case.
The Debtor is represented by:
Alex O. Acosta, Esq.
ACOSTA LAW P.C.
One Northwest Centre
Houston TX 77040
CORAL POINTE: Unsecureds Will Get $250 per Month for 36 Months
--------------------------------------------------------------
Coral Pointe 604, LLC filed with the U.S. Bankruptcy Court for the
Southern District of Florida a Disclosure Statement describing
Chapter 11 Plan dated February 3, 2025.
The Debtor is a Limited Liability Corporation and owns a condo
Coral Pointe, 1690 SW 27 Ave Unit 604 Miami, FL 33145 rented for
$1600 valued at 175,000.
The Debtor owns unit above but business operations are c/ business
operations are at 1521 Alton Road Suite 812, Miami Beach, FL
33139.
The Property was purchased by the Debtor from the condominium
association which had title value $175,000 subject to $373,000
judgment of US Bank. Debtor has been negotiating with the bank
since the filing of the case. Debtor has been paying maintenance to
Condo Association and repairs monthly.
Class 4 consists of General Unsecured Creditors. The allowed
unsecured claims total $9,000. This Class shall be paid in equal
monthly installments of $250 per month for 36 months starting month
3. This Class is impaired.
Class 5 consists of Equity Security Holders of the Debtor. Equity
Holders will keep memberships for new value paid in this case.
Payments and distributions under the Plan will be funded by Laurent
Benzaquen and affiliates and rent income.
The Debtor will be able to make the payments required under the
plan from continuing contributions outside of the plan and the
rent.
A full-text copy of the Disclosure Statement dated February 3, 2025
is available at https://urlcurt.com/u?l=32DSPJ from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Joel M. Aresty, Esq.
Law firm of Joel M. Aresty, P.A.
309 1st Ave S
Tierra Verde FL 33715
Tel: (305) 904-1903
Fax: (800) 899-1870
Email: Aresty@Mac.com
About Coral Pointe 604
Coral Pointe 604, LLC is a Limited Liability Corporation and owns a
condo Coral Pointe, 1690 SW 27 Ave Unit 604 Miami, FL 33145.
The Debtor sought protection for relief under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 24-21820) on November
12, 2024, with $100,001 to $500,000 in both assets and
liabilities.
Judge Laurel M. Isicoff oversees the case.
Joel M. Aresty PA is the Debtor's legal counsel.
CRYSTAL PACKAGING: To Sell Business Inventory for $5MM
------------------------------------------------------
Crystal Packaging, Inc., seeks permission from the U.S. Bankruptcy
Court for the District of Colorado, to sell substantially all of
its assets, free and clear of liens, claims, and other interests.
The Debtor's business involves blending and packaging windshield
washer fluid; industrial and consumer cleaning products; and bulk
lubricants and glycols. The company’s customers base distributes
nationwide, with a focus in the Midwest and Western United States.
The Debtor subleases the facility where it operates from Power
Assist Company (PAC), a related entity and creditor of CPI. PAC, in
turn leases the premises from Boston Henderson, LLC.
The Debtor encountered several unforeseen obstacles, including the
loss of an important customer, an unseasonably dry winter resulting
in a significant drop in sales, and falling prey to an ACH fraud
scheme in early 2024. As a result, the Debtor failed to make
certain lease payments for its facility and Boston Henderson
commenced a forcible entry and detainer action. Given these
circumstances, The Debtor's only viable strategy for providing a
return to creditors and ensuring continued employment of its
employees is selling its business as a going concern.
Three companies, all of whom were customers of the Debtor,
expressed a serious interest in purchasing its assets including
Elliott Auto Supply Co., Inc. d/b/a Factory Motor Parts and a/k/a
Splash Products, Inc., D-A Lubricant Company, Inc., and Replenish
Bottling & Clean Revolution.
The Debtors' sign an asset purchase agreement with D-A Packaging
LLC, after an informal auction, with a high bid of $5,025,000.00
submitted by its wholly-owned subsidiary D-A Packaging, LLC.
Included in the sale are inventory, equipment, supplies, vehicles,
non-factored accounts receivable, fixed assets, machinery,
equipment, furniture, warehouse racking, forklifts, leasehold
improvements, intellectual property, telephone numbers, books and
records, permits, contracts and unfulfilled purchase orders.
The sale does not include Excluded Assets, which consists of only
cash, factored accounts receivable, 4 personal laptop computers,
two desks, and a $40,000 deposit held by Woodriver Energy.
The Purchase Price for the Assets is $5,025,000.00 in cash, payable
at Closing.
The Assets are subject to following disputed and undisputed liens:
First Citizens Bank & Trust Company, Financial Pacific Leasing,
Inc., Adams County Treasurer, Rocky Mountain Petroleum Corp., PAC,
Olympic Distribution Center LLC, Zimmerman Family Trust, and
Elliott Auto Supply.
The Debtors seek to close the sale on or before March 5, 2025 to
accommodate the terms of the purchase agreement.
About Crystal Packaging, Inc.
Crystal Packaging Inc. is a family owned liquid blending company
offering a variety of contract and toll services for organizations
across the country.
Crystal Packaging Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Col. Case No. 24-13093) on June 4, 2024.
In the petition signed by C. Scott Vincent, as president, the
Debtor reports estimated assets up to $50,000 and estimated
liabilities between $1 million and $10 million.
Honorable Bankruptcy Judge Thomas B. Mcnamara oversees the case.
The Debtor is represented by David V. Wadsworth, Esq. at WADSWORTH
GARBER WARNER CONRARDY, P.C.
EARTH SCIENCE: Buys Back Over 17.4MM Common Shares as of Jan. 31
----------------------------------------------------------------
Earth Science Tech, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that as of January 31,
2025, the Company has repurchased a total of 17,422,680 shares of
its common stock under its $5,000,000 repurchase program, which was
initiated on January 29, 2024.
Since the program's inception, the Company's outstanding shares
have decreased from 315,181,821 shares to 297,397,903 shares,
marking a 5.53% reduction in the total number of shares
outstanding. The repurchase program is set to expire December 31,
2025, but may be suspended or discontinued at any time, and does
not obligate the Company to repurchase any specific number of
shares.
About Earth Science Tech
Miami, Fla.-based Earth Science Tech, Inc. was incorporated under
the laws of the State of Nevada on April 23, 2010, subsequently
changed to the State of Florida on June 27, 2022. As of November 8,
2022, the Company is a holding entity set to acquire companies with
its current focus in the health and wellness industry. The Company
is presently in compounding pharmaceuticals and telemedicine
through its wholly owned subsidiaries RxCompoundStore.com, LLC.,
Peaks Curative, LLC., and Earth Science Foundation, Inc.
Boca Raton, Fla.-based R. Bolko, CPA P.A, the Company's auditor
since 2022, issued a "going concern" qualification in its report
dated April 16, 2024, citing that the Company has suffered negative
cash flows and has a significant accumulated deficit. These factors
raise substantial doubt about the Company's ability to continue as
a going concern.
As of September 30, 2024, Earth Science Tech had $5,049,628 in
total assets, $1,848,496 in total liabilities, and $3,201,132 in
total stockholders' equity.
EARTH SCIENCE: Inks Deal to Acquire 80% of Magnefuse, Alicat
------------------------------------------------------------
Earth Science Tech, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that it entered into an
acquisition agreement with Magnefuse, LLC and Alicat, LLC, both
Florida limited liability companies.
Under the terms of the agreement, Earth Science Tech will acquire
eighty percent of the Florida companies for a total of $240,500. At
the time of execution, Earth Science Tech will make an upfront
payment of $210,500. The remaining balance of $30,000 will be paid
at closing, which will occur after a 90-day due diligence period.
Earth Science Tech will also have the option to purchase the
remaining 20% ownership of the Florida companies for up to two
years following the closing. The purchase price will be based on a
valuation of two times the Florida companies' revenue at the time
of the transaction.
Visit: magnechef.com
About Earth Science Tech
Miami, Fla.-based Earth Science Tech, Inc. was incorporated under
the laws of the State of Nevada on April 23, 2010, subsequently
changed to the State of Florida on June 27, 2022. As of November 8,
2022, the Company is a holding entity set to acquire companies with
its current focus in the health and wellness industry. The Company
is presently in compounding pharmaceuticals and telemedicine
through its wholly owned subsidiaries RxCompoundStore.com, LLC.,
Peaks Curative, LLC., and Earth Science Foundation, Inc.
Boca Raton, Fla.-based R. Bolko, CPA P.A, the Company's auditor
since 2022, issued a "going concern" qualification in its report
dated April 16, 2024, citing that the Company has suffered negative
cash flows and has a significant accumulated deficit. These factors
raise substantial doubt about the Company's ability to continue as
a going concern.
As of September 30, 2024, Earth Science Tech had $5,049,628 in
total assets, $1,848,496 in total liabilities, and $3,201,132 in
total stockholders' equity.
EARTH SCIENCE: Inks Deal to Acquire Two Florida Firms for $400K
---------------------------------------------------------------
Earth Science Tech, Inc. disclosed in a Form 8-K Report filed with
the U.S. Securities and Exchange Commission that it entered into an
acquisition agreement with Las Villas Healthcare, LLC. and
Doconsultations.com, LLC., both Florida limited liability
companies.
Under the terms of the agreement, Earth Science Tech will acquire
100% of the Florida companies for a total of $400,000. At the time
of execution, Earth Science Tech will make an upfront payment of
$50,000. The remaining balance of $350,000 will be paid at closing,
which will occur after a 90-day due diligence period.
Visit:
https://villashealthandwellness.com
https://doconsultations.com
About Earth Science Tech
Miami, Fla.-based Earth Science Tech, Inc. was incorporated under
the laws of the State of Nevada on April 23, 2010, subsequently
changed to the State of Florida on June 27, 2022. As of November 8,
2022, the Company is a holding entity set to acquire companies with
its current focus in the health and wellness industry. The Company
is presently in compounding pharmaceuticals and telemedicine
through its wholly owned subsidiaries RxCompoundStore.com, LLC.,
Peaks Curative, LLC., and Earth Science Foundation, Inc.
Boca Raton, Fla.-based R. Bolko, CPA P.A, the Company's auditor
since 2022, issued a "going concern" qualification in its report
dated April 16, 2024, citing that the Company has suffered negative
cash flows and has a significant accumulated deficit. These factors
raise substantial doubt about the Company's ability to continue as
a going concern.
As of September 30, 2024, Earth Science Tech had $5,049,628 in
total assets, $1,848,496 in total liabilities, and $3,201,132 in
total stockholders' equity.
EMMAUS LIFE: Seah Lim Holds 6.5% Stake
--------------------------------------
Seah H. Lim, M.D., Ph.D. disclosed in a Schedule 13G/A filed with
the U.S. Securities and Exchange Commission that as of December 31,
2024, she beneficially owned 4,147,426 shares Emmaus Life Sciences,
Inc.'s common stock, representing 6.5% of the shares outstanding.
Seah H. Lim may be reached at:
21250 Hawthorne Boulevard
Suite 800
Torrance, California 90503
A full-text copy of Lim's SEC Report is available at:
https://tinyurl.com/yr54aa8p
About Emmaus Life Sciences
Emmaus Life Sciences, Inc. is a commercial-stage biopharmaceutical
company engaged in the marketing and sales of the Company's lead
product Endari (prescription grade L-glutamine oral powder), which
is approved by the U.S. Food and Drug Administration, or FDA, to
reduce the acute complications of sickle cell disease in adult and
pediatric patients five years of age and older. Endari has received
Orphan Drug designation from the FDA, which designation generally
affords marketing exclusivity for Endari in the U.S. for a
seven-year period ending in July 2024.
San Diego, Calif.-based Baker Tilly US LLP, the Company's former
auditor, issued a "going concern" qualification in its report dated
July 2, 2024, citing that the Company has incurred recurring
operating losses, including a net loss of $3.7 million for the year
ended December 31, 2023, and had a working capital deficit of $50
million at December 31, 2023. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
Emmaus Life Sciences reported a net loss of $3.7 million for the
year ended December 31, 2023. As of March 31, 2024, Emmaus Life
Sciences had $29.5 million in total assets, $83.2 million in total
liabilities, and $53.6 million in total stockholders' deficit.
EMX ROYALTY: Board Member Wright Confirmed as U.S. Energy Secretary
-------------------------------------------------------------------
EMX Royalty Corporation congratulates EMX board member,Chris
Wright, on his confirmation as U.S. Secretary of Energy under
President Donald Trump.
Mr. Wright was confirmed as Secretary on February 3, 2025 in a
bipartisan vote in the U.S. Senate and will now join the Cabinet of
the United States in Washington, D.C. Mr. Wright is known for his
innovations and entrepreneurial contributions to the energy sector,
but also for his focus on humanitarian efforts such as co-founding
the Bettering Human Lives Foundation. He has been a spirited
contributor at EMX board meetings and management discussions.
As a consequence of his confirmation, Mr. Wright will step down
from the board of EMX. The Company sincerely thanks Mr. Wright for
his contributions at EMX and is excited to observe his future role
in leading and shaping the energy policy of the United States.
About EMX
EMX Royalty Corporation -- https://emxroyalty.com/ -- is a precious
and base metals royalty company. EMX's investors are provided with
discovery, development, and commodity price optionality while
limiting exposure to risks inherent to operating companies. The
Company's common shares are listed on the NYSE American Exchange
and TSX Venture Exchange under the symbol "EMX."
Vancouver, Canada-based Davidson & Company LLP, the Company's
auditor since 2002, issued a "going concern" qualification in its
report dated March 21, 2024, citing that the Company has a working
capital deficiency that raises substantial doubt about its ability
to continue as a going concern.
For the year ended December 31, 2023, the Company reported a net
loss of $4.63 million, compared to a net income of $3.35 million
for the same period in 2022. As of September 30, 2024, EMX had
$156.5 million in total assets, $39.1 million in total liabilities,
and $117.4 million in total shareholders' equity.
ENTRUST ENERGY: Loses Summary Judgment Bid in Shell Energy Dispute
------------------------------------------------------------------
In the case captioned as ENTRUST ENERGY, INC., et al., Plaintiffs,
VS. SHELL ENERGY NORTH AMERICA (US), L.P., et al., Defendants,
ADVERSARY NO. 21-3930 (S.D. Tex.), Judge Marvin Isgur of the United
States Bankruptcy Court for the Southern District of Texas denied
the cross-motions for summary judgment filed by Entrust Energy,
Inc. and Shell Energy North America (US), L.P. relating to certain
energy agreements entered into by the parties.
This adversary proceeding concerns whether Shell improperly
terminated its energy agreements with Entrust during Winter Storm
Uri.
Entrust and Shell are parties to certain energy contracts, under
which Shell agreed to provide financial services and energy
supplies to Entrust at a fixed rate. Entrust would purchase energy
from Shell and would then sell the energy to its customers.
On Feb. 14, 2021, Shell terminated its present and future energy
transactions with Entrust pursuant to a termination provision in
the parties' agreements. Shell alleged that Entrust failed to
comply with its Risk Policy, triggering an Event of Default under
the agreements. The parties agree that certain forecasts were out
of compliance with Entrust's hedging requirements. Entrust alleges
that it had obtained the approvals needed to comply with its Risk
Policy. Shell denies that the necessary approvals had been
obtained.
Shell argues that summary judgment should be granted in its favor
because there is no genuine issue of material fact precluding a
finding that:
(i) Entrust is the Defaulting Party under the Energy
Contracts;
(ii) Shell did not breach its obligations under the Energy
Contracts; and
(iii) Shell's breach, if any, did not cause Entrust
damages.
Entrust moves for cross-relief.
Shell argues that Entrust is unable to demonstrate that Shell's
breach, if any, resulted in damages. Shell's arguments are a rehash
of its defenses. According to the Court, Shell offers no argument
or evidence as to whether Entrust can actually prove its claimed
damages. Entrust's allegations of damages arising out of Shell's
breach and calculation of the termination payment are facially
sufficient. Summary judgment on this issue is denied.
Shell's Defenses
The parties seek summary judgment on Shell's defenses of
acquiescence, waiver, estoppel, laches, and failure to exercise
contract rights/forfeiture of contract rights.
The Court finds there is a genuine issue of material fact as to
whether Entrust was in Default when Shell terminated its
transactions with Entrust. If Entrust was in Default, there is a
genuine issue of material fact as to whether Shell breached its
contractual obligations following the termination of the
transactions, including in its calculation of the termination
payment. The parties' cross-motions for summary judgment on
Entrust's breach of contract claim are denied without prejudice.
Shell's Laches Defense
Shell is correct in arguing that laches would be available as a
defense to an equitable specific performance claim. But Entrust's
breach of contract claim is not a specific performance claim. The
breach of contract claim is a legal claim for damages, the Court
finds.
Shell's laches defense is denied with prejudice. Summary judgment
on the remaining defenses is not ripe at this stage of the
adversary proceeding, the Court finds. Except for the laches
defense, the parties' cross-motions for summary judgment on Shell's
defenses are denied without prejudice.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=75hyLz from PacerMonitor.com.
ENVERIC BIOSCIENCES: Orca Capital Holds 4.9% Equity Stake
---------------------------------------------------------
Orca Capital AG disclosed in a Schedule 13G/A filed with the U.S.
Securities and Exchange Commission that as of January 31, 2025, it
beneficially owned 97,019 shares of Enveric Biosciences, Inc.'s
common stock, representing 4.9% of the shares outstanding.
Orca Capital may be reached at:
Thomas Konig/Director
Orca Capital AG
Sperlring 2
Pfaffenhofen 2M 85276
Tel: 498441 78644 14
A full-text copy of Orca Capital's SEC Report is available at:
https://tinyurl.com/2p9vnbp9
About Enveric Biosciences
Enveric Biosciences (NASDAQ: ENVB) -- http://www.enveric.com/-- is
a biotechnology company dedicated to the development of novel
neuroplastogenic small-molecule therapeutics for the treatment of
depression, anxiety, and addiction disorders. Leveraging its
unique discovery and development platform, The Psybrary, the
Company has created a robust intellectual property portfolio of new
chemical entities for specific mental health indications. The
Company's lead program, the EVM201 Series, comprises next
generation synthetic prodrugs of the active metabolite, psilocin.
The Company is developing the first product from the EVM201 Series
- EB-002 - for the treatment of psychiatric disorders. The Company
is also advancing its second program, the EVM301 Series - EB 003 -
expected to offer a first-in-class, new approach to the treatment
of difficult-to-address mental health disorders, mediated by the
promotion of neuroplasticity without also inducing hallucinations
in the patient.
East Hanover, New Jersey-based Marcum LLP, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated March 25, 2024, citing that the Company has incurred
significant losses and needs to raise additional funds to meet its
obligations and sustain its operations. These conditions raise
substantial doubt about the Company's ability to continue as a
going concern.
For the year ended December 31, 2023, Enveric Biosciences had a
loss from operations of $16.4 million. As of September 30, 2024,
Enveric Biosciences had $4,790,316 in total assets, $839,166 in
total liabilities, and $3,951,150 in total stockholders' equity.
FIREFLY STORE: Unsecureds Will Get 75% of Claims in Plan
--------------------------------------------------------
Firefly Store Solutions, Inc. submitted an Amended Plan of
Liquidation dated January 31, 2025.
The Debtor's primary asset is land and a building located at 4500
S. Holden Road in Greensboro North Carolina (the "Property").
The Debtor has an offer to purchase the Property from Lee Spring
Company for $3.3 million with said offer expected to close within
100 days of court approval for which a Court Order approving the
sale was entered on January 29, 2025. If the sale of the Property
has not closed within 3 months of the effective date of the Plan
the Debtor will hire an auction company to liquidate the Property
with such liquidation to be completed within an additional 90
days.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $3,400,000. The final Plan
payment is expected to be paid on or before July 1, 2025.
This Plan proposes to pay creditors of the Debtor from cash flow
from liquidation of assets.
Class 5 consists of General Unsecured Claims. The Debtor
anticipates that the Allowed Claims of Class 5 General Unsecured
Claims will total approximately $567,000, excluding insider claims.
Based on the liquidation value of the estate, the Debtor proposes
to pay $.75 to the General Unsecured Claims.
The Debtor is required to pay to general unsecured claims its
Disposable Income for no less than 3 years from the date that the
first distribution is due under the Plan. The Debtor expects to
liquidate its property within 3 to 6 months of the effective date
of the plan, with all funds after payment of administrative
expenses, allowed secured claims and priority tax claims being paid
to the general unsecured creditors up to 75% of allowed general
unsecured claims. In the event this is a non-consensual plan, the
Debtor shall pay all remaining funds to the Trustee on or before
September 30, 2025, for distribution, pursuant to this provision of
the Plan. This Class is impaired.
Class 6 consists of Unsecured Claims of Insiders. The Debtor
anticipates that there will be two allowed Class 6 claims to Adria
Arias in the amount of $48,800 and Maria Arias in the amount of
$71,800. Allowed Class 6 Claims are to be subordinated to the Class
5 General Unsecured Claims and shall receive no special treatment
should the Real and Personal Property not sell in a timely manner
or for a sufficient amount to pay all General Unsecured Claims in
full.
The Debtor will fund payments under the Plan from liquidation of
business assets.
A full-text copy of the Amended Liquidating Plan dated January 31,
2025 is available at https://urlcurt.com/u?l=ZF4I8r from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Dirk W. Siegmund, Esq.
McClellan, Siegmund, Brumbaugh
& McDonough, LLP
PO Box 3324
Greensboro, NC 27402
Tel: (336) 274-4658
Email: skb@iveymcclellan.com
About Firefly Store Solutions
Firefly Store Solutions, Inc., a company in Greensboro, N.C., has
been providing American retailers with store solutions, retail
store fixtures, and store displays since 1954.
Firefly Store Solutions filed its voluntary Chapter 11 petition
(Bankr. M.D.N.C. Case No. 24-10591) on September 20, 2024, listing
$1 million to $10 million in both assets and liabilities. The
petition was signed by Adria Arias as chief executive officer.
Judge Benjamin A. Kahn presides over the case.
Dirk W. Siegmund, Esq., at Ivey, Mcclellan, Siegmund, Brumbaugh &
Mcdonough, LLP represents the Debtor as legal counsel.
FRANCHISE GROUP: Court Denies Request to Employ Willkie Farr
------------------------------------------------------------
Rick Archer of Law360 reports that on February 12, 2025, a Delaware
bankruptcy judge denied Franchise Group Inc.'s request to retain
Willkie Farr & Gallagher LLP in its Chapter 11 case, citing
conflicts from a previous transaction that are too significant to
the company's reorganization plans.
About Franchise Group Inc.
Franchise Group, Inc., through its subsidiaries, operates
franchised and franchisable businesses including The Vitamin
Shoppe, Pet Supplies Plus, LLC, Badcock Home Furniture & More,
American Freight, Buddy's Home Furnishings and Sylvan Learning
Systems, Inc.
Franchise Group, Inc. and its affiliates filed their voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Del. Lead Case No. 24-12480) on Nov. 3, 2024, listing
$1,000,000,001 to $10 billion in both assets and liabilities. The
petitions were signed by David Orlofsky as chief restructuring
officer.
Willkie Farr & Gallagher LLP and Young Conaway Stargatt & Taylor,
LLP are serving as legal counsel, AlixPartners is serving as
financial advisor and Chief Restructuring Officer, and Ducera
Partners is serving as investment banker to the Company. Paul
Hastings LLP is serving as legal counsel and Lazard is serving as
investment banker to the first lien ad hoc group.
FRANCHISE GROUP: Paul Hastings & Landis Revise Rule 2019 Statement
------------------------------------------------------------------
The law firms of Paul Hastings LLP and Landis Rath & Cobb LLP filed
an amended verified statement pursuant to Rule 2019 of the Federal
Rules of Bankruptcy Procedure to disclose that in the Chapter 11
cases of Franchise Group, Inc., and affiliates, the firms represent
the Ad Hoc Group of First Lien Lenders.
On or around May 13, 2024, the Ad Hoc Group of First Lien Lenders
retained Paul Hastings as counsel in connection with potential
negotiations and transactions related to the Debtors. Each member
of the Ad Hoc Group of First Lien Lenders has consented to Paul
Hastings's representation.
On or around October 3, 2024, the Ad Hoc Group of First Lien
Lenders retained Landis as counsel in connection with potential
negotiations and transactions related to the Debtors. Each member
of the Ad Hoc Group of First Lien Lenders has consented to Landis's
representation.
On November 5, 2024, Counsel filed the Verified Statement of the Ad
Hoc Group of First Lien Lenders Pursuant to Bankruptcy Rule 2019.
Subsequently, the members of the Ad Hoc of First Lien Lenders and
the disclosable economic interests such members hold in relation to
the Debtors have changed. Accordingly, pursuant to Bankruptcy Rule
2019, Counsel submits this Amended Verified Statement.
The members of the Ad Hoc Group of First Lien Lenders are either
the beneficial holders of, or the investment advisors or managers
to, funds and/or accounts that hold disclosable economic interests
in relation to the Debtors.
Counsel represents only the members of the Ad Hoc Group of First
Lien Lenders and does not represent or purport to represent any
persons or entities other than the Ad Hoc Group of First Lien
Lenders in connection with the Chapter 11 Cases. In addition, as of
the date of this Amended Verified Statement, the Ad Hoc Group of
First Lien Lenders does not, either collectively or through its
individual members, represent or purport to represent any other
persons or entities in connection with the Chapter 11 Cases.
The Ad Hoc Group of First Lien Lenders' address and the nature and
amount of disclosable economic interests held in relation to the
Debtors are:
1. Funds managed by Arena Capital Advisors, LLC and/or its
affiliates
12121 Wilshire Boulevard Suite 1010
Los Angeles, CA 90025
* New Money DIP Loans: $24,267,262.64
* Roll Up DIP Loans: $41,024,925.48
* First Lien Term Loans: $91,437,530.98
2. Funds managed by Bardin Hill Loan Management LLC and/or its
affiliates
299 Park Avenue, 24th Floor
New York, NY 10171
* New Money DIP Loans: $902,425.69
* Roll Up DIP Loans: $1,244,725.10
* First Lien Term Loans: $2,776,767.83
3. Funds managed by Blue Owl Liquid Credit Advisors, LLC and/or its
affiliates
1 Greenwich Plaza Suite C, 2nd Floor
Greenwich, CT 06830
* New Money DIP Loans: $1,338,021.53
* Roll Up DIP Loans: $2,619,902.28
* First Lien Term Loans: $5,844,478.27
4. Funds managed by CastleKnight Management LP and/or its
affiliates
888 Seventh Avenue 24 Floor
New York, NY 10019
* Roll Up DIP Loans: $2,078,364.82
* First Lien Term Loans: $4,644,368.07
5. Certain funds and accounts managed by Fidelity Management &
Research Company LLC and/or its
affiliates
245 Summer Street
Boston, MA 02210
* New Money DIP Loans: $16,616,068.80
* Roll Up DIP Loans: $20,620,316.57
* First Lien Term Loans: $46,030,623.11
6. Funds managed by Garnett Station Partners and/or its affiliates
450 Park Avenue 24th Floor
New York, NY 10022
* New Money DIP Loans: $19,189,189.32
* Roll Up DIP Loans: $32,758,217.26
* First Lien Term Loans: $69,290,774.82
7. Funds managed by Guggenheim Partners Investment Management, LLC
and/or its affiliates
330 Madison Avenue
New York, NY 10017
* New Money DIP Loans: $20,709,447.16
* Roll Up DIP Loans: $35,058,514.57
* First Lien Term Loans: $77,270,266.02
8. Funds managed by HG Vora Capital Management, LLC and/or its
affiliates
330 Madison Avenue 21st Floor
New York, NY 10017
* New Money DIP Loans: $43,020,609.68
* Roll Up DIP Loans: $72,728,322.17
* First Lien Term Loans: $162,476,558.37
* Second Lien Term Loans: $9,375,000.00
* HoldCo Term Loans: $40,070,901.5571
9. Funds managed by HPS Investment Partners, LLC and/or its
affiliates
40 West 57th Street 33rd Floor
New York, NY 10019
* New Money DIP Loans: $20,002,143.70
* Roll Up DIP Loans: $24,822,389.54
* First Lien Term Loans: $55,447,914.87
10. Funds managed by MJX Asset Management, LLC and/or its
affiliates
12 East 49th Street Floor 38
New York, NY 10017
* New Money DIP Loans: $2,754,360.67
* Roll Up DIP Loans: $3,799,118.16
* First Lien Term Loans: $8,456,304.123
11. Funds managed by Monroe Capital LLC and/or its affiliates
311 South Wacker Drive Suite 6400
Chicago, IL 60606
* New Money DIP Loans: $1,304,946.93
* Roll Up DIP Loans: $2,555,140.85
* First Lien Term Loans: $5,455,875.11
12. Funds managed by Oaktree Capital Management, L.P. and/or its
affiliates
333 South Grand Avenue 28th Floor
Los Angeles, CA 90071
* New Money DIP Loans: $15,854,963
* Roll Up DIP Loans: $24,863,824
* First Lien Term Loans: $58,762,817
13. Funds managed by Octagon Credit Investors, LLC and/or its
affiliates
250 Park Avenue
New York, NY 10177
* New Money DIP Loans: $18,440,502.63
* Roll Up DIP Loans: $30,969,343.13
* First Lien Term Loans: $69,800,356.34
14. Funds managed by Saratoga Partners and/or its affiliates
535 Madison Avenue 4th Floor
New York, NY 10022
* New Money DIP Loans: $1,102,956.94
* Roll Up DIP Loans: $2,159,635.97
* First Lien Term Loans: $4,611,298.44
Counsel to the Ad Hoc Group of First Lien Lenders:
LANDIS RATH & COBB LLP
Adam G. Landis, Esq.
Matthew B. McGuire, Esq.
Elizabeth A. Rogers, Esq.
919 Market Street, Suite 1800
Wilmington, Delaware 19801
Telephone: (302) 467-4400
Facsimile: (302) 467-4450
Email: landis@lrclaw.com
mcguire@lrclaw.com
erogers@lrclaw.com
- and -
PAUL HASTINGS LLP
Jayme T. Goldstein, Esq.
Daniel A. Fliman, Esq.
Jeremy Evans, Esq.
Isaac S. Sasson, Esq.
200 Park Avenue
New York, New York 10166
Telephone: (212) 318-6000
Facsimile: (212) 319-4090
Email: jaymegoldstein@paulhastings.com
danfliman@paulhastings.com
jeremyevans@paulhastings.com
isaacsasson@paulhastings.com
Nicholas A. Bassett, Esq.
2050 M Street NW
Washington, DC 20036
Telephone: (202) 551-1700
Facsimile: (202) 551-1705
Email: nicholasbassett@paulhastings.com
About Franchise Group
Franchise Group, Inc., through its subsidiaries, operates
franchised and franchisable businesses including The Vitamin
Shoppe, Pet Supplies Plus, LLC, Badcock Home Furniture & More,
American Freight, Buddy's Home Furnishings and Sylvan Learning
Systems, Inc.
Willkie Farr & Gallagher LLP and Young Conaway Stargatt & Taylor,
LLP are serving as legal counsel, AlixPartners is serving as
financial advisor and Chief Restructuring Officer, and Ducera
Partners is serving as investment banker to the Company. Paul
Hastings LLP is serving as legal counsel and Lazard is serving as
investment banker to the first lien ad hoc group.
As reported in the Troubled Company Reporter on Nov. 6, 2024,
Franchise Group, Inc. announced on Nov. 3, 2024, that it has
entered into a restructuring support agreement with holders of
approximately 80% of its first lien debt on a comprehensive
solution to strengthen FRG's capital structure and best position
its leading brands -- Pet Supplies Plus, The Vitamin Shoppe, and
Buddy's Home Furnishings -- for continued sustainable growth.
The RSA contemplates the proposed equitization of the first lien
debt into 100% of the equity in the reorganized enterprise, which
would substantially reduce the Company's debt, enhance liquidity,
and strengthen the enterprise for the benefit of Pet Supplies Plus,
The Vitamin Shoppe, and Buddy's Home Furnishings and their
stakeholders.
FRANCHISE GROUP: Updates Unsecured Claims Details; Amends Plan
--------------------------------------------------------------
Franchise Group, Inc., and its Affiliated Debtors submitted a
Disclosure Statement describing Second Amended Joint Plan dated
February 3, 2025.
Although proposed jointly for administrative purposes, the Plan
constitutes a separate Plan for each Debtor for the resolution of
outstanding Claims and Interests pursuant to the Bankruptcy Code.
Each Debtor is a proponent of the Plan within the meaning of
section 1129 of the Bankruptcy Code.
The Non-Liquidating Debtors are pursuing on parallel paths both the
Plan Equitization Transaction and a Sale Transaction, all as
described in further detail in the Disclosure Statement.
The American Freight Debtors are pursuing Store-Closing and
Liquidation Sales, all as described in further detail in the
Disclosure Statement. Following the Store-Closing and Liquidation
Sales, the American Freight Debtors will be wound down. The
proceeds of the Store-Closing and Liquidation Sales shall be
distributed in accordance with the applicable provisions of this
Plan.
In addition, this Plan provides for and implements the Committee
Settlement, as incorporated into this Plan and embodied in the term
sheet by and among the Committee Settlement Parties. Pursuant to
the Committee Settlement, the Committee Settlement Parties have
agreed to, among other things, resolve any and all disputes between
the Required Consenting First Lien Lenders, the Debtors, and the
Creditors' Committee in exchange for (i) the establishment of the
OpCo Debtor Litigation Trust; (ii) funding of the OpCo Debtor
Litigation Trust Escrow Amount; (iii) mutual releases as provided
for in this Plan; and (iv) support for this Plan.
This Plan serves as a motion to approve the Committee Settlement
pursuant to Bankruptcy Rule 9019. The entry of the Confirmation
Order shall constitute the Bankruptcy Court's approval of each of
the compromises and settlements provided for in the Committee
Settlement, and the Bankruptcy Court's findings shall constitute
its determination that such compromises and settlements are in the
best interests of the Debtors, the Estates, holders of Claims, and
other parties in interest, and are fair, equitable, and
reasonable.
Class 8-A consists of Freedom HoldCo General Unsecured Claims. In
full and final satisfaction, compromise, settlement, release, and
discharge of each Allowed Freedom HoldCo General Unsecured Claim,
except to the extent that a Holder of an Allowed Freedom HoldCo
General Unsecured Claim agrees to less favorable treatment on
account of its Claim, on the Effective Date, or as soon as
practicable thereafter, each Holder of an Allowed Freedom HoldCo
General Unsecured Claim shall receive:
* in the event the Restructuring Transactions are consummated
through the Plan Equitization Transaction (including, for the
avoidance of doubt, following any Partial Sale Transaction, if
any), (A) its pro rata share of the HoldCo General Unsecured Claims
Distribution allocable to the Freedom HoldCo Debtors resulting from
any Partial Sale Transaction, if any, and (B) to the extent that,
after conclusion of the Freedom HoldCo Independent Investigation,
it is determined that the Freedom HoldCo Debtors have Claims and
Causes of Action that are not otherwise settled, discharged or
released under or pursuant to the Plan, its pro rata share of any
recovery from the Freedom HoldCo Debtor Liquidation Trust. If the
proceeds of the Partial Sale Transaction do not result in a HoldCo
General Unsecured Claims Distribution, or there is no recovery from
the Freedom HoldCo Debtor Liquidation Trust, then such Holder of a
Freedom HoldCo General Unsecured Claim shall receive no
consideration on account of its Freedom HoldCo General Unsecured
Claim; or
* in the event the Restructuring Transactions are consummated
through the Sale Transaction, (A) its pro rata share of the HoldCo
General Unsecured Claims Distribution, if any and (B) to the extent
that, after conclusion of the Freedom HoldCo Independent
Investigation, it is determined that the Freedom HoldCo Debtors
have Claims and Causes of Action that are not otherwise settled,
discharged or released under or pursuant to the Plan, its pro rata
share of any recovery from the Freedom HoldCo Debtor Liquidation
Trust. If the proceeds of the Sale Transaction do not result in a
HoldCo General Unsecured Claims Distribution, or there is no
recovery from the Freedom HoldCo Debtor Liquidation Trust, then
such Holder of a Freedom HoldCo General Unsecured Claim shall
receive no consideration on account of its Freedom HoldCo General
Unsecured Claim.
Class 8-B consists of HoldCo Receivables General Unsecured Claims.
In full and final satisfaction, compromise, settlement, release,
and discharge of each Allowed HoldCo Receivables General Unsecured
Claim, except to the extent that a Holder of an Allowed HoldCo
Receivables General Unsecured Claim agrees to less favorable
treatment on account of its Claim, on the Effective Date, or as
soon as practicable thereafter, each Holder of an Allowed HoldCo
Receivables General Unsecured Claim shall receive:
* in the event the Restructuring Transactions are consummated
through the Plan Equitization Transaction (including, for the
avoidance of doubt, following any Partial Sale Transaction, if
any), its pro rata share of the HoldCo General Unsecured Claims
Distribution allocable to Freedom VCM Interco Holdings, Inc.,
Freedom Receivables II, LLC, or Freedom VCM Receivables, Inc.
resulting from any Partial Sale Transaction, if any. If the
proceeds of the Partial Sale Transaction do not result in a HoldCo
General Unsecured Claims Distribution, then such Holder of a HoldCo
Receivables General Unsecured Claim shall receive no consideration
on account of its HoldCo Receivables General Unsecured Claim; or
* in the event the Restructuring Transactions are consummated
through the Sale Transaction, its pro rata share of the HoldCo
General Unsecured Claims Distribution, if any. If the proceeds of
the Sale Transaction do not result in a HoldCo General Unsecured
Claims Distribution, then such Holder of a HoldCo Receivables
General Unsecured Claim shall receive no consideration on account
of its HoldCo Receivables General Unsecured Claim.
Class 8-C consists of TopCo General Unsecured Claims. In full and
final satisfaction, compromise, settlement, release, and discharge
of each Allowed TopCo General Unsecured Claim, except to the extent
that a Holder of an Allowed TopCo General Unsecured Claim agrees to
less favorable treatment on account of its Claim, on the Effective
Date, or as soon as practicable thereafter, each Holder of an
Allowed TopCo General Unsecured Claim shall receive:
* in the event the Restructuring Transactions are consummated
through the Plan Equitization Transaction (including, for the
avoidance of doubt, following any Partial Sale Transaction, if
any), (A) its pro rata share of Cash, if any, held by TopCo
following the allocation described in Section 3.3(c) hereof, and
(B) its pro rata share of the HoldCo General Unsecured Claims
Distribution allocable to TopCo resulting from any Partial Sale
Transaction, if any. If (x) there is no Cash held at TopCo
following the allocation described in Section 3.3(c) hereof, and
(y) the proceeds of the Partial Sale Transaction do not result in a
HoldCo General Unsecured Claims Distribution, then such Holder of a
TopCo General Unsecured Claim shall receive no consideration on
account of its TopCo General Unsecured Claim; or
* in the event the Restructuring Transactions are consummated
through the Sale Transaction, its pro rata share of the HoldCo
General Unsecured Claims Distribution, if any. If the proceeds of
the Sale Transaction do not result in a HoldCo General Unsecured
Claims Distribution, then such Holder of a TopCo General Unsecured
Claim shall receive no consideration on account of its TopCo
General Unsecured Claim.
In the event of a Plan Equitization Transaction, the Debtors shall
fund Cash distributions under the Plan with Cash on hand, including
Cash from operations, the American Freight Liquidation Proceeds,
the Sale Proceeds (if any) and the proceeds of the DIP Facility.
Cash payments to be made pursuant to the Plan will be made by the
Reorganized Debtors or the Disbursing Agent.
In the event of a Sale Transaction or a Partial Sale Transaction,
the Debtors shall fund Cash distributions under the Plan from Cash
on hand (if any), the American Freight Liquidation Proceeds, and
the Sale Proceeds in accordance with the terms of the Sale
Documents and the Plan.
In the event a Freedom HoldCo Debtor Liquidation Trust is
established, the Debtors shall fund distributions to Allowed Claims
against the Freedom HoldCo Debtors from proceeds of the Freedom
HoldCo Debtor Liquidation Trust.
A full-text copy of the Second Amended Plan dated February 3, 2025
is available at https://urlcurt.com/u?l=1wCgNE from Kroll
Restructuring Administration LLC, claims agent.
Proposed Co-Counsel to the Debtors:
Edmon L. Morton, Esq.
Shella Borovinskaya, Esq.
Matthew B. Lunn, Esq.
Allison S. Mielke, Esq.
Shella Borovinskaya, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
E-mail: emorton@ycst.com
mlunn@ycst.com
amielke@ycst.com
sborovinskaya@ycst.com
Debra M. Sinclair, Esq.
Matthew A. Feldman, Esq.
Betsy L. Feldman, Esq.
Joseph R. Brandt, Esq.
WILLKIE FARR & GALLAGHER LLP
787 Seventh Avenue
New York, New York 10019
Tel: (212) 728-8000
Fax: (212) 728-8111
E-mail: dsinclair@willkie.com
mfeldman@willkie.com
bfeldman@willkie.com
jbrandt@willkie.com
About Franchise Group Inc.
Franchise Group, Inc., through its subsidiaries, operates
franchised and franchisable businesses including The Vitamin
Shoppe, Pet Supplies Plus, LLC, Badcock Home Furniture & More,
American Freight, Buddy's Home Furnishings and Sylvan Learning
Systems, Inc.
Franchise Group, Inc. and its affiliates filed their voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Del. Lead Case No. 24-12480) on Nov. 3, 2024, listing
$1,000,000,001 to $10 billion in both assets and liabilities. The
petitions were signed by David Orlofsky as chief restructuring
officer.
Willkie Farr & Gallagher LLP and Young Conaway Stargatt & Taylor,
LLP are serving as legal counsel, AlixPartners is serving as
financial advisor and Chief Restructuring Officer, and Ducera
Partners is serving as investment banker to the Company. Paul
Hastings LLP is serving as legal counsel and Lazard is serving as
investment banker to the first lien ad hoc group.
FREE SPEECH: Sandy Hook Families Accuse Alex Jones of Ambush Appeal
-------------------------------------------------------------------
Aaron Keller of Law360 reports that the victims of the 2012 Sandy
Hook mass shooting have asked Connecticut's highest court to
dismiss Infowars host Alex Jones' appeal of a record-breaking
defamation verdict, arguing he abandoned the defenses he now seeks
to assert under a special review for unpreserved constitutional
claims.
About Free Speech Systems
Free Speech Systems LLC is a broadcast media production and
distribution company that provides broadcasting aural programs by
radio to the public. Free Speech Systems is a family-run business
founded by Alex Jones.
FSS is presently engaged in the business of producing and
syndicating Jones' radio and video talk shows and selling products
targeted to Jones' loyal fan base via the Internet. Today, FSS
produces Alex Jones' syndicated news/talk show (The Alex Jones
Show) from Austin, Texas, which airs via the Genesis Communications
Network on over 100 radio stations across the United States and via
the internet through websites including Infowars.com.
Due to the content of Alex Jones' shows, Jones and FSS have faced
an all-out ban of Infowars from mainstream online spaces. Shunning
from financial institutions and banning Jones and FSS from major
tech companies began in 2018.
Conspiracy theorist Alex Jones has been sued by victims' family
members over Jones' lies that the 2012 Sandy Hook Elementary School
shooting was a hoax.
Jones' InfoW LLC and affiliates, IWHealth, LLC and Prison Planet
TV, LLC, filed petitions under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April
18, 2022.
FTX TRADING: Struggling to Serve Binance With Chapter 11 Lawsuit
----------------------------------------------------------------
Lauren Berg of Law360 reports that the estate of defunct
cryptocurrency exchange FTX told a Delaware bankruptcy judge on
February 7 that its attorneys have yet to serve Binance and former
CEO Changpeng Zhao with a lawsuit seeking to recover nearly $1.8
billion.
The suit alleges FTX unlawfully transferred the funds before its
collapse two years ago, the report states.
About FTX Trading Ltd.
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
million 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 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 bankruptcy counsel; Young Conaway Stargatt & Taylor, LLP as
Delaware and conflicts counsel; FTI Consulting, Inc. as financial
advisor; and Jefferies, LLC as investment banker.
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.
FULCRUM BIOENERGY: Unsecureds' Recovery "Unknown" in Plan
---------------------------------------------------------
Fulcrum Bioenergy Inc. and affiliates filed with the U.S.
Bankruptcy Court for the District of Delaware a Disclosure
Statement for Joint Chapter 11 Plan of Liquidation dated February
3, 2025.
Founded in July 2007, the Company was a pioneer in the clean energy
space that conceptualized a first-of-its-kind "waste-to fuel"
process whereby municipal solid waste is converted into drop-in
fuels through the utilization of gasification, Fischer Tropsch and
other technologies.
Through its proprietary process that incorporates commercially
proven technologies, the Company set out to simultaneously solve
two environmental challenges—reducing the amount of waste going
to landfills and reducing carbon emissions in the aviation
industry. BioFuels' Plant (the "Sierra Plant") located
approximately twenty miles east of Reno, Nevada, first brought this
"waste-to-fuel" process to life in December 2022, successfully
producing low carbon synthetic crude oil from landfill waste.
The Debtors commenced these chapter 11 cases to conduct a court
supervised sale process with the assistance of its professionals to
maximize the value of their estates for the benefit of their
stakeholders. To that end, prior to the Petition Date, the Debtors
received a bid (the "Stalking Horse Bid") from Switch for the
purchase of certain of the Debtors' assets (the "Switch Acquired
Assets"). Thereafter, the Debtors, through their professionals,
engaged in extensive negotiations with Switch at arms-length.
In connection with the Stalking Horse Bid, the Debtors and Switch
entered into the Stalking Horse APA, which provided for a purchase
price of $15,000,000, plus the assumption or elimination of certain
liabilities associated with the Switch Acquired Assets.
Among other assets, the Switch Acquired Assets included the
Debtors' (1) real property at assessor's parcel number 005-071-49
(the "Biorefinery Real Property") and certain utility rights,
including electrical and water, easements, improvements, and other
rights and credits appurtenant to the Biorefinery Real Property
(together, the "Biorefinery Assets") and (2) real property at
assessor's parcel number 004-111-37 (the "Feedstock Real
Property"), as well as certain utility rights, including electrical
and water, easements, improvements, and other rights and credits
appurtenant to the Feedstock Real Property, including any and all
fixtures, improvements, and appurtenances thereto (the "Feedstock
Assets").
The Debtors conducted an Auction on November 7, 2024, which
ultimately encompassed a total of fifty-seven rounds of bidding
from the Qualified Bidders, which covered multiple lots and
included one hundred and twenty-two separate bids. At the
conclusion of the Auction and in consultation with the Consultation
Parties, the Debtors selected Switch and Refuse, Inc. as the
Successful Bidders. Switch's prevailing bid consisted of a $55
million bid for the Biorefinery Assets. Refuse's prevailing bid
consisted of a $3 million bid for the Debtors' Feedstock Assets.
The Debtors continued the Auction with respect to the Expanded
Assets.
The Plan constitutes a joint plan of liquidation for all of the
Debtors. The Plan does not seek the substantive consolidation of
the Debtors.
Generally, the Plan provides the following:
* Payment in full of all Allowed Administrative Expense
Claims, Fee Claims, U.S. Trustee Fees, Priority Tax Claims and
Other Priority Claims;
* Funding of a Liquidation Trust to govern the liquidation of
the Debtors' estates and remaining assets following the Effective
Date;
* Holders of General Unsecured Claims shall receive an
interest in the Liquidation Trust;
* Liquidation Trust Assets shall be liquidated to provide a
distribution to Liquidation Trust Beneficiaries; and
* No recovery to the holders of Interests on account of their
Interests.
Class 4A consists of Fulcrum Undersecured and General Unsecured
Claims. Each holder of an Allowed Fulcrum Undersecured and General
Unsecured Claim shall receive in full satisfaction, settlement, and
release of, and in exchange for such Allowed Fulcrum Undersecured
and General Unsecured Claim the Pro Rata Share of the Cash, if any,
to be distributed from the Fulcrum Liquidation Trust Account. The
amount of claim in this Class total $93,863,401. This Class is
impaired.
Class 4B consists of Holdings Undersecured and General Unsecured
Claims. Each holder of an Allowed Holdings Undersecured and General
Unsecured Claim shall receive in full satisfaction, settlement, and
release of, and in exchange for such Allowed Holdings Undersecured
and General Unsecured Claim the Pro Rata Share of the Cash, if any,
to be distributed from the Holdings Liquidation Trust Account. This
Class is impaired.
Class 4C consists of BioFuels Undersecured and General Unsecured
Claims. Each holder of an Allowed BioFuels Undersecured and General
Unsecured Claim shall receive in full satisfaction, settlement, and
release of, and in exchange for such Allowed BioFuels Undersecured
and General Unsecured Claim the Pro Rata Share of the Cash, if any,
to be distributed from the BioFuels Liquidation Trust Account. The
amount of claim in this Class total $80,863,858. This Class is
impaired.
The estimated recovery for General Unsecured Claims is "unknown",
according to the Disclosure Statement.
Interests shall be extinguished, cancelled and released on the
Effective Date. Holders of Interests shall not receive or retain
any distribution under the Plan on account of such Interests.
On or before the Effective Date, the Liquidation Trust Agreement
shall be executed, and all other necessary steps shall be taken to
establish the Liquidation Trust to hold the Liquidation Trust
Assets, which shall be for the benefit of the Liquidation Trust
Beneficiaries. Section 6.3 of the Plan sets forth certain of the
rights, duties, and obligations of the Liquidation Trustee.
The Liquidation Trust shall consist of the Liquidation Trust
Assets. Except as otherwise provided in the Plan or the
Confirmation Order, on the Effective Date, the Debtors shall be
deemed to have transferred all of the Liquidation Trust Assets held
by the Debtors to the Liquidation Trust, and all Liquidation Trust
Assets shall vest in the Liquidation Trust on the Effective Date,
to be administered by the Liquidation Trustee, in accordance with
the Plan and the Liquidation Trust Agreement, free and clear of all
Liens, Claims, encumbrances and other Interest.
A full-text copy of the Disclosure Statement dated February 3, 2025
is available at https://urlcurt.com/u?l=TAWhe2 from KURTZMAN CARSON
CONSULTANTS, LLC, d/b/a VERITA GLOBAL, is the claims agent.
Counsel to the Debtors:
MORRIS, NICHOLS, ARSHT & TUNNELL LLP
Robert J. Dehney, Sr., Esq.
Curtis S. Miller, Esq.
Clint M. Carlisle, Esq.
Avery Jue Meng, Esq.
1201 N. Market Street, 16th Floor
Wilmington, Delaware 19801
Telephone: (302) 658-9200
Email: rdehney@morrisnichols.com
cmiller@morrisnichols.com
ccarlisle@morrisnichols.com
ameng@morrisnichols.com
About Fulcrum Bioenergy
Fulcrum Bioenergy Inc. operates as a clean energy company described
as a pioneer in sustainable aviation fuel (SAF) production.
Fulcrum Bioenergy Inc. and its affiliates sought relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
24-12008) on Sept. 9, 2024. In the petition filed by Mark J. Smith,
as chief restructuring officer, the Debtor reports estimated assets
up to $50,000 and estimated liabilities between $100 million and
$500 million.
The Honorable Bankruptcy Judge Thomas M. Horan handles the case.
The Debtors tapped MORRIS, NICHOLS, ARSHT & TUNNELL LLP as counsel;
and DEVELOPMENT SPECIALISTS, INC., as investment banker. KURTZMAN
CARSON CONSULTANTS, LLC, d/b/a VERITA GLOBAL, is the claims agent.
GENAPSYS INC: Unable to Retrieve Certain Docs From Paul Hastings
----------------------------------------------------------------
Craig Clough of Law360 reports that a California judge ruled that
GenapSys Inc. can reclaim certain documents accidentally disclosed
during discovery in its legal malpractice lawsuit against Paul
Hastings LLP.
However, documents discussed in depositions cannot be recovered, as
GenapSys attorneys failed to raise appropriate objections during
the proceedings, the report states.
About GenapSys Inc.
GenapSys Inc. -- https://genapsys.com/ -- is a biotechnology
company that transforms the human condition by building a scalable,
affordable genomic sequencing ecosystem that will support research
and diagnostics. It is based in Redwood City, Calif.
GenapSys sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Del. Case No. 22-10621) on July 11, 2022. In the
petition filed by Britton Russell, chief financial officer and
treasurer, the Debtor listed assets between $10 million and $50
million and liabilities between $50 million and $100 million.
Judge Brendan Linehan Shannon oversees the case.
The Debtor tapped Richards, Layton & Finger, PA, as bankruptcy
counsel; Willkie Farr & Gallagher LLP as special litigation and
corporate counsel; and Lazard Freres & Co. LLC as investment
banker. Kroll Restructuring Administration LLC is the Debtor's
claims and noticing agent and administrative advisor.
* * *
The Debtor sold the business for $42 million (up to $10 million in
cash plus the assumption of liabilities) to Sequencing Health, a
purchaser entity affiliated with entities, funds and/or accounts
managed or advised, directly or indirectly, by, or under common
control with, two investors holding Series D Preferred Equity
Interests in the Debtor: Farallon and Soleus Private Equity Fund
II, LP. Following the sale, what's left of the debtor Debtor
renamed itself to Redwood Liquidating Co.
GIST ENTITIES: Unsecureds Will Get 10% of Claims over 60 Months
---------------------------------------------------------------
Gist Entities, LLC, filed with the U.S. Bankruptcy Court for the
Northern District of Illinois a Plan of Reorganization for Small
Business dated January 31, 2025.
The Debtor is an Illinois Limited Liability Company which operates
a clinical testing center located at 11006 West 179th Street,
Orland Park, IL 60467 ("Orland Park"). The Debtor was formed in
2019 and its member/manager is Ebonie Gist.
The Debtor needed to file the Chapter 11 case in order to stay
pending litigation in the Circuit Court of the Twelfth Judicial
Circuit, Will County, IL, commenced by BMO Bank, N.A., Case No.
2024LA000100, and to restrain certain other collection activities
of creditors.
The Debtor's Plan proposes to continue its business operations and
generate income with which to pay the creditors holding allowed
secured claims in full and a dividend to general unsecured
creditors. This Plan proposes to pay creditors of the Debtor from
cash on hand, cash flow projections and future income.
The financial projections show that the Debtor will have projected
disposable income in excess of $290,362.00. The final Plan payment
is expected to be paid on the 60th month following the effective
date of the Plan.
Class 3 consists of allowed, general unsecured claims including the
unsecured claims of Citizens, IRS and IDR. According to the
Debtor's schedules and the proofs of claim filed, the Debtor
believes that the total amount of unsecured claims in this class is
$307,037. These claims will be paid, pro rata, without interest, a
dividend in the amount of ten percent of the allowed claims in
monthly payments over a period of 60 months commencing 30 days
after the effective date of the Plan. The monthly payment to be
shared by this class, pro rata, is $511.72.
Class 4 consists of Ebonie Gist as the member/manager of the
Debtor. Upon confirmation of the Plan, Ebonie will continue to be
vested with the membership of the Debtor and will manage the
Debtor's affairs.
Management of the Debtor will remain in Ebonie. The Debtor will
retain all of its assets, subject to the applicable lien of
Citizens, and will continue operating its business affairs to
generate the disposable income necessary to fund the Plan. The Plan
will be implemented and funded by existing cash on hand at the
effective date of the Plan and by future income generated by
operation of the Debtor.
A full-text copy of the Plan of Reorganization dated January 31,
2025 is available at https://urlcurt.com/u?l=kxq7n3 from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Joel A. Schechter, Esq.
Law Offices of Joel A. Schechter
53 W. Jackson Blvd., Suite 1522
Chicago, IL 60604
Telephone: (312) 332-0267
Email: joel@jasbklaw.com
About Gist Entities
Gist Entities, LLC is an Illinois Limited Liability Company which
operates a clinical testing center located at 11006 West 179th
Street, Orland Park, IL 60467 ("Orland Park").
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ill. Case No. 24-05418) on April 13,
2024, with $50,001 to $100,000 in assets and $500,001 to $1 million
in liabilities.
Judge Jacqueline P. Cox presides over the case.
Joel A. Schechter, Esq., at the Law Offices of Joel Schechter, is
the Debtor's bankruptcy counsel.
H & H FAST: Unsecureds Will Get 36.3% of Claims over 48 Months
--------------------------------------------------------------
H & H Fast Properties Inc., filed with the U.S. Bankruptcy Court
for the Northern District of Illinois a Fourth Amended Small
Business Plan under Subchapter V dated January 31, 2025.
The Debtor is in the business of purchasing, rehabilitation,
leasing, and selling of parcels of real estate.
The Debtor owns five parcels of real estate as stated on the
Debtor's Schedules: 1) 3328 E. 88th St. Chicago, IL; 2) 4840 S.
Ellis Avenue, Chicago, Illinois 60515 (subject to GitSit Solutions
LLC mortgage and Small Business Administration mortgages); 3) 20745
S. Alexander Street Olympia Fields, Illinois (subject to Toorak
Capital Partners LLC mortgage); 4) 8736 S. Mackinaw Chicago, IL
60461 and 5) 8724 S. Mackinaw Chicago, IL.
The real estate commonly known as 4840 S. Ellis Avenue, Chicago,
Illinois ("the Ellis Avenue Property") and 20745 Alexander Street,
Olympia Fields, Illinois 60461 ("the Alexander Street Property").
The Debtor will continue with construction projects, liquidate
machinery, equipment and vehicles to submit good faith deposits.
The Debtor's schedules state that the fair market value of
machinery, equipment and vehicles are over $70,000.00.
The Debtor's Plan provides for payments to be made to allowed
claims from the Debtor's operations and sale of machine, equipment,
and vehicles.
Class 2 consists of Allowed General Unsecured Claims. The Debtor's
general unsecured creditors total $396,026.07. Each Holder of
Allowed Class 2 Claims shall be paid a pro rata share of $3,000.00
per month for forty-eight months beginning in the 13th month after
confirmation of this Plan with an estimated payment of 36.3% to
unsecured non priority creditors. Class 2 is impaired under this
Plan.
All of the assets of the Debtor and this estate shall vest in the
Debtor upon Confirmation of the Plan subject to the liquidation,
terms and conditions of this Plan.
This Plan is self-executing. The Debtor shall not be required to
execute any newly created documents to evidence the claims, liens
or terms of repayment to the holder of any Allowed Claim.
A full-text copy of the Fourth Amended Plan dated January 31, 2025
is available at https://urlcurt.com/u?l=U17GMi from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Penelope N Bach, Esq.
BACH LAW OFFICES, INC.
P.O. Box 1285
Northbrook, IL 60065
Telephone: (847) 564-0808
Facsimile: (847) 564-0985
Email: pnbach@bachoffices.com
About H & H Fast Properties
H & H Fast Properties, Inc., a Chicago-based company, filed a
petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. N.D. Ill. Case No. 23-16874) on December 18, 2023, with $1
million to $10 million in both assets and liabilities. Amanda
Henderson, president, signed the petition.
Judge Jacqueline P. Cox oversees the case.
Paul M. Bach, Esq., at Bach Law Offices represents the Debtor as
bankruptcy counsel.
HDTSOKANOS LLC: Files Chapter 11 Bankruptcy in New York
-------------------------------------------------------
On February 6, 2025, Hdtsokanos LLC filed Chapter 11 protection in
the U.S. Bankruptcy Court for the Eastern District of New York.
According to court filing, the Debtor reports $1,634,678 in
debt owed to 1 and 49 creditors. The petition states funds will be
available to unsecured creditors.
About Hdtsokanos LLC
Hdtsokanos LLC possesses a building at 24-35 27th Street, Astoria,
NY 11102, with an estimated worth of $2.45 million.
Hdtsokanos LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 25-40606) on February 6,
2025. In its petition, the Debtor reports total assets of
$2,485,638 and total liabilities of $1,634,678.
Honorable Bankruptcy Judge Elizabeth S. Stong handles the case.
The Debtor is represented by Btzalel Hirschhorn, Esq., at SHIRYAK,
BOWMAN, ANDERSON, GILL & KADOCHNIKOV, LLP, in Kew Gardens, New
York.
HEALTHLYNKED CORP: Shares Strategic Vision in Shareholder Letter
----------------------------------------------------------------
HealthLynked Corp. announced the release of its Annual Shareholder
Letter. This Update outlines the company's significant achievements
in product development and platform enhancements as well as
offering strategic priorities for the coming year.
2024: Excellent strides expanding its capabilities to spur growth
initiatives
The Annual Shareholder Letter highlights HealthLynked's integration
of new features and product development during 2024 designed to
enhance patient engagement and drive greater demand for the
company's unique offering, including:
* Launch of ARI, HealthLynked's Advanced A.I. Healthcare
Guidance: ARI enables patients to onboard effortlessly, update
their medical profiles, and receive personalized healthcare
recommendations. ARI can analyze patient data to provide tailored
personalized medical guidance.
* Nationwide Expansion of its Telemedicine Capabilities:
HealthLynked expanded its telemedicine services from limited
Florida coverage to 24/7 nationwide access. This expansion ensures
patients can connect with licensed healthcare providers at any
time.
* Launch of its Concierge Service: Unveiled a premium
concierge service, offering members unparalleled access to
healthcare management for a small monthly fee.
* Strategic Partnerships Program: HealthLynked initiated a
partnership program aimed at integrating new services and benefits
into the platform.
* Discount Prescription Drug Program HealthLynked introduced a
discount prescription drug program. This initiative offers members
significant savings on medications.
CEO's Vision for 2024 and Beyond
In the letter, Dr. Dent shares HealthLynked's growth opportunity
and his larger vision for 2025 and beyond, emphasizing:
HealthLynked remains committed to scaling its unique platform by
focusing on near-term initiatives designed to drive growth and
engagement. By leveraging innovative marketing campaigns, forming
strategic partnerships, and continuously enhancing the platform's
capabilities, HealthLynked aims to expand its membership base and
increase overall demand. A key aspect of this strategy is enhancing
affinity marketing opportunities by collaborating with insurance
providers, major employers, and professional employer organizations
(PEOs). These partnerships will allow HealthLynked to reach a
broader audience and provide greater value to users.
Beyond these immediate growth efforts, HealthLynked's larger vision
is centered on transforming healthcare by enhancing care management
for patients and their families, increasing access to quality
healthcare services, and leveraging patient data to improve medical
care and drive meaningful advancements in medical research. Through
these initiatives, HealthLynked continues to work toward a future
where healthcare is more connected, accessible, and personalized
for all.
The complete Annual Shareholder Letter is available on the
HealthLynked website at
https://investors.healthlynked.com/shareholder-resources/.
Shareholders and interested parties are encouraged to review the
letter for a comprehensive overview of the company's
accomplishments and strategic direction.
About HealthLynked Corp.
Naples, Fla.-based HealthLynked Corp. was incorporated in the State
of Nevada on August 4, 2014. It operates a cloud-based patient
information network and record archiving system in the United
States and currently operates through three distinct divisions: the
Health Services Division, the Digital Healthcare Division, and the
Medical Distribution Division.
New York, N.Y.-based RBSM LLP, the Company's auditor since 2014,
issued a "going concern" qualification in its report dated April 1,
2024, citing that the Company has recurring losses from operations,
limited cash flow, and an accumulated deficit. These conditions
raise substantial doubt about the Company's ability to continue as
a going concern.
As of June 30, 2024, HealthLynked had $3,859,664 in total assets,
$4,284,243 in total liabilities, and $424,579 in total
shareholders' deficit.
HELIUS MEDICAL: Faces Nasdaq Delisting Threat, Can Appeal Decision
------------------------------------------------------------------
Helius Medical Technologies, Inc. filed a Form 8-K with the
Securities and Exchange Commission on Feb. 7, 2025, disclosing that
the Company received a letter from the Nasdaq Stock Market's
Listing Qualifications Department, which stated that the company
remains in non-compliance with the Minimum Bid Price Requirement.
The letter further informed the Company that the Company's common
stock would be delisted from The Nasdaq Capital Market unless the
Company appeals the Staff's delisting determination by requesting a
hearing before the Nasdaq Hearings Panel.
The Company's request for a hearing will stay any further delisting
action by the Staff pending the ultimate outcome of the hearing.
The Company's common stock will remain listed and eligible for
trading on Nasdaq at least pending the ultimate conclusion of the
hearing process.
On Aug. 9, 2024, Helius Medical received a letter from Nasdaq
notifying the Company that, because the closing bid price for its
common stock had been below $1.00 per share for 30 consecutive
trading days, it was not compliant with Nasdaq Marketplace Rule
5550(a)(2). In accordance with Nasdaq Marketplace Rule
5810(c)(3)(A), the Company had a period of 180 calendar days from
Aug. 9, 2024, or until Feb. 5, 2025, to regain compliance with the
Minimum Bid Price Requirement.
The Company stated it plans to timely request a hearing before the
Panel to appeal the determination by the Staff, and to present its
plan to regain and sustain compliance with the Minimum Bid Price
Requirement.
About Helius Medical
Headquartered in Newtown, Pennsylvania, Helius Medical
Technologies, Inc. is a neurotechnology company focused on
neurological wellness. The Company's purpose is to develop,
license or acquire non-implantable technologies targeted at
reducing symptoms of neurological disease or trauma. The Company's
product, known as the Portable Neuromodulation Stimulator, or PoNS,
is an innovative non-implantable medical device, inclusive of a
controller and mouthpiece, which delivers mild electrical
stimulation to the surface of the tongue to provide treatment of
gait deficit and chronic balance deficit. PoNS Therapy is integral
to the overall PoNS solution and is the physical therapy applied by
patients during use of the PoNS device. PoNS has marketing
clearance in the U.S. for use as a short-term treatment of gait
deficit due to mild-to-moderate symptoms for multiple sclerosis and
is to be used as an adjunct to a supervised therapeutic exercise
program in patients 22 years of age and over by prescription only.
Minneapolis, Minnesota-based Baker Tilly US, LLP, the Company's
auditor since 2022, issued a "going concern" qualification in its
report dated March 28, 2024. The report highlighted that the
Company has recurring losses from operations, an accumulated
deficit, expects to incur losses for the foreseeable future and
requires additional working capital. These are the factors that
raise substantial doubt about the Company's ability to continue as
a going concern.
Helius incurred a net loss of $8.85 million in 2023, following a
net loss of $14.07 million in 2022. As of Sept. 30, 2024, the
Company had cash and cash equivalents of $3.5 million. The
Company's net loss was $7.8 million for each of the nine months
ended Sept. 30, 2024 and 2023. As of Sept. 30, 2024, the Company
had an accumulated deficit of $167.8 million. The Company expects
to continue to incur significant expenses and operating losses for
the foreseeable future.
"There is no assurance that the Company will achieve profitable
operations, and, if achieved, whether it will be sustained on a
continued basis. These factors indicate substantial doubt about
the Company's ability to continue as a going concern within one
year after the date the consolidated financial statements are
filed. The Company intends to fund ongoing activities by utilizing
its current cash and cash equivalents on hand, cash received from
the sale of its PoNS device in the U.S. and Canada and by raising
additional capital through equity or debt financings. 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. If the Company is unable
to raise sufficient additional capital, the Company may be
compelled to reduce the scope of its operations," Helius stated in
its Quarterly Report for the period ended Sept. 30, 2024.
HOP-HEDZ INC: To Sell Tampa Property for $2.8MM
-----------------------------------------------
HOP-HEDZ, Inc., seeks permission from the U.S. Bankruptcy Court for
the Middle District of Florida, Tampa Division, to sell its
property, free and clear of liens, interests, and encumbrances.
The Debtor's Property is located at 211 and 213 Fremont Ave, Tampa,
Florida.
The Property is encumbered by secured creditor, Allstate Funding
Corporation.
The Debtor enters into a Contract which provides for the Property
to be sold, and for another property owned by 1901 W. Platt St. LLC
to be sold, for a total price of $2,850,000.00, and requires
closing on or before February 20, 2025.
The Debtor has made all Plan payments to Allstate, except for the
balloon payment, which will be $563,251.89 on February 20, 2025.
Debtor has also paid all late fees due to Allstate under the Plan.
IDE Technologies, Inc. TI-770 LLC, and Nancy C. Millan, Tax
Collector have filed tax claim against the Property.
The $15,023.74 in taxes that Debtor agrees is owed to Allstate will
be paid to Allstate at the Closing.
The unsecured creditors under the Plan do not object to the Sale,
including specifically Brandon Garner, who will be paid $15,000.00
at Closing, and Luther Moore, who will be paid $5,000.00 at
Closing.
1901 Platt has no objection to the Motion, and otherwise consents
to the use and escrow of the proceeds as requested.
The Debtor believes that the Sale is fair and reasonable. It is
unlikely that a significantly higher sale price for the Property
would be achieved through further marketing, and any potential
increase in the sale price would likely be exceeded by the
additional costs associated with maintaining and operating the
Property.
About HOP-HEDZ, Inc.
Tampa, Fla.-based Hop-Hedz, Inc. filed a petition for Chapter 11
protection (Bankr. M.D. Florida Case No. 20-09249) on Dec. 20,
2020, listing up to $10 million in assets and up to $1 million in
liabilities.
Judge Caryl E. Delano oversees the case.
W. Bart Meacham, Esq., is the Debtor's legal counsel.
J. HOWELL: Seeks to Use Cash Collateral
---------------------------------------
J. Howell Tiller MD, LLC asked the U.S. Bankruptcy Court for the
Northern District of Florida, Pensacola Division, for authority to
use cash collateral.
American Choice Capital, LLC, Flexibility Capital, Inc., Forward
Financing LLC, and Funding Metrics, LLC assert an interest in the
company's cash collateral.
As of the petition date, the company's assets include a small
amount of cash on hand and limited physical assets worth no more
than $10,000. However, the company is operating and generating
revenue each month.
Funding Metrics, LLC is in first lien position with respect to the
cash collateral.
As adequate protection for the use of cash collateral, the company
will pay monthly payments of $200 to Funding Metrics beginning this
month.
About J. Howell Tiller MD, LLC
J. Howell Tiller MD, LLC filed Chapter 11 petition (Bankr. N.D.
Fla. Case No. 25-30068) on January 29, 2025, listing up to $50,000
in assets and up to $100,000 in liabilities. Dr. John H Tiller.
manager, signed the petition.
Judge Karen K. Specie oversees the case.
Byron W. Wright, Esq., at Bruner Wright, P.A., represents the
Debtor as legal counsel.
JORIKI TOPCO: Obtains Ontario Court's CCAA Initial Stay Order
-------------------------------------------------------------
Joriki TopCo Inc. ("Joriki TopCo") and Joriki Inc. ("Joriki
Canada") made an application to the Ontario Superior Court of
Justice (Commercial List) ("Court") and were granted: (i) an order
("Initial Order"), which, among other things, provides for a stay
of proceedings pursuant to the Companies' Creditors Arrangement
Act, as amended ("CCAA"); and (ii) the Auction and Liquidation
Approval Order (Pickering Facility).
Pursuant to the Initial Order, Alvarez & Marsal Canada Inc. was
appointed as monitor of the business and financial affairs of the
Companies.
On Jan. 12, 2025, Joriki USA Inc. ("Joriki USA"), Joriki Canada's
U.S. subsidiary, filed a petition under Chapter 7 of the United
States Bankruptcy Code before the United States Bankruptcy Court
for the District of Delaware. The Chapter 7 bankruptcy filing
stays any proceedings against Joriki USA. Alfred T. Giuliano of
Giuliano Miller & Co., LLC has been appointed bankruptcy trustee in
the Chapter 7 case ("Chapter 7 Trustee"). Further information on
the Chapter 7 proceedings will be made available by the Chapter 7
Trustee on the Chapter 7 case website.
In addition, on Dec. 31, 2024, Joriki Inc. ("Joriki Canada") filed
a Notice of Intention to Make a Proposal ("NOI") pursuant to
Section 50.4(1) of the Bankruptcy and Insolvency Act (Canada),
("BIA") and Alvarez & Marsal Canada Inc. ("A&M") was appointed as
Proposal Trustee of the Company ("Proposal Trustee"). Joriki Inc.
filed an NOI to obtain a stay of proceedings to provide additional
breathing room while it evaluates its strategic alternatives.
According to Court Documents, production at the Pickering facility
in Ontario was halted in July 2024, as the Pickering facility was
implicated in a Canada-wide recall of Silk(R) and Great Value(R)
plant-based beverages as a result of a Listeria monocytogenes
outbreak ("Recall").
Production at each of the Toronto, Delta and Pittston facilities
was halted at the end of December 2024. At that time, the Company
had approximately 565 full-time and temporary employees,
approximately 337 of whom were employed by Joriki Canada. The
employment of virtually all employees was terminated on Dec. 31,
2024, save for a small number of employees retained to assist with
winding-down the Companies' operations.
Joriki Canada, as borrower, Joriki USA and Joriki TopCo, as
guarantors, are indebted to The Bank of Nova Scotia and The
Toronto-Dominion Bank ("Senior Lenders") under secured creditor
agreements, as amended and restated ("Senior Secured Facilities"),
which are in default. As of Dec. 31, 2024, there was approximately
$192 million owed under the Senior Secured Facilities. It is
expected that the Senior Lenders will incur a significant shortfall
on their outstanding secured loans upon completion of the CCAA
Proceedings and the Chapter 7 Case.
Copies of relevant material including any Orders of the Ontario
Superior Court of Justice (Commercial List) and related motion
materials will be posted at:
https://www.alvarezandmarsal.com/Joriki
Any further information with respect to this matter, please feel
free to contact the Monitor directly at joriki@alvarezandmarsal.com
or 1-844-304-2642.
Monitor can be reached at:
Alvarez & Marsal Canada Inc.
Royal Bank Plaza, South Tower
200 Bay Street, Suite 3501
Toronto, ON M5J 2W4
Al Hutchens
Tel: 416-847-5159
Email: ahutchens@alvarezandmarsal.com
Steve Moore
Tel: 416-847-5167
Email: smoore@alvarezandmarsal.com
Nate Fennema
Tel: 416-847-5183
Email: nfennema@alvarezandmarsal.com
Counsel to the Companies:
Goodmans LLP
Bay Adelaide Centre - West Tower
333 Bay Street, Suite 3400
Toronto, ON M5H 2S7
Robert J. Chadwick
Tel: 416-597-4285
Email: rchadwick@goodmans.ca
Christopher Armstrong
Tel: 416.849.6013
Email: carmstrong@goodmans.ca
Erik Axell
Tel: 416-840-2579
Email: eaxell@goodmans.ca
Counsel to the Monitor:
Osler, Hoskin & Harcourt LLP
1 First Canadian Place
100 King Street West
Suite 6200, P.O. Box 50
Toronto ON M5X 1B8
Tracy Sandler
Tel: 416-862-5890
Email: tsandler@osler.com
Justin Kanji
Tel: 416-862-6642
Email: jkanji@osler.com
Counsel for Bank of Nova Scotia & Toronto-Dominion Bank:
McMillan LLP
181 Bay Street
Brookfield Place, Suite 4400
181 Bay Street
Toronto, ON M5J 2T3
Wael Rostom
Email: Wael.Rostom@mcmillan.ca
Tel: 416-865-7790
Christopher Keliher
Email: christopher.keliher@mcmillan.ca
Tel: 403-531-4724
Financial Advisor for Bank of Nova Scotia & Toronto-Dominion Bank:
FTI CONSULTING INC.
Toronto-Dominion Centre, TD South Tower
79 Wellington St W Suite 2010
Toronto, ON M5K 1G8
Paul Bishop
Email: Paul.Bishop@fticonsulting.com
Tel: 416-649-8053
Hrvoje Muhek
Email: Hrvoje.Muhek@fticonsulting.com
Tel: 416-649-8063
Joriki TopCo Inc. makes and packs consumer beverages, including
juices and plant-based beverages, primarily for large consumer
packaged goods companies, from four leased production facilities
(three in Canada and one in the United States). Joriki Canada's
three facilities are in Toronto and Pickering, Ontario and in
Delta, British Columbia. Joriki USA's facility is in Pittston,
Pennsylvania.
KAL FREIGHT: Creditors Seek Appointment of Examiner
---------------------------------------------------
A group of creditors filed with the U.S. Bankruptcy Court for the
Southern District of Texas a motion to appoint an examiner in the
Chapter 11 cases of Kal Freight Inc. and its affiliates.
The creditors, including Mitsubishi HC Capital Canada Inc., Truist
Equipment Finance Corp., and Fifth Third Bank, N.A. claim that the
Debtors and their principal, Kalvinder Singh, committed fraud on
their lenders by, among other reasons: (a) double pledging
collateral; (b) pledging non-existent collateral; (c) altering VINs
to mislead lenders; and (d) transferring collateral between
affiliated Canadian companies in violation of loan documents prior
to the commencement of the bankruptcy cases. And the Debtors do not
run from such allegations.
The creditors explain that the Debtors have conceded, as stated in
the declaration of the Debtors' Chief Restructuring Officer,
Bradley D. Sharp, that they may have engaged in significant
malfeasance prior to the petition date to the detriment of all
creditors. To combat the negative perception of filing their
Chapter 11 cases, the Debtors displaced Mr. Singh and appointed two
independent directors to wash themselves of the taint associated
with Mr. Singh's fraudulent leadership.
An examiner appointed under Section 1104(c) of the Bankruptcy Code
will serve as an estate fiduciary with the sole mandate of
investigating prepetition conduct and recommending to this Court
appropriate remedial measures benefitting all creditors. Indeed,
section 1104(c) mandates the appointment of an Examiner in these
Chapter 11 Cases because there exist credible (and recognized)
allegations of fraud, mismanagement, and possible incompetence,
according to the creditors.
The creditors assert that the appointment of an independent
examiner is necessary to ensure transparency and that valuable
estate causes of action are not squandered. They request the
appointment of an independent examiner to investigate the Debtors'
and Mr. Singh's pre-bankruptcy conduct and submit that the
appointment of an independent examiner will further the Bankruptcy
Code's goals of full transparency and disclosure to parties in
interest.
The creditors further assert that while they are supportive of the
unsecured creditors' committee having input into the proper scope
of the examiner's investigation, including having input in the
choice of the examiner, only an independent examiner can be truly
fair and impartial without being beholden to any constituency but
this court.
Attorneys for the creditors:
Devan J. Dal Col, Esq.
Alexis A. Leventhal, Esq.
Reed Smith, LLP
2850 N. Harwood Street, Suite 1500
Dallas, TX 75201
Telephone: 469.680.4200
Facsimile: 469.680.4299
Email: ddalcol@reedsmith.com
aleventhal@reedsmith.com
About Kal Freight
Established in 2014, Kal Freight Inc. is a trucking company that
offers a complete range of transportation and logistics services to
diverse industries across the United States. It has strategic
locations across the United States with extended distribution
warehouses and terminals in Fontana, Calif., Texas, New Jersey,
Indiana, Tennessee, Georgia, Arizona and Arkansas.
Kal Freight and its affiliates filed Chapter 11 petitions (Bankr.
S.D. Tex. Case No. 24-90614) on December 5, 2024, with $100 million
to $500 million in both assets and liabilities.
Judge Christopher M. Lopez oversees the case.
The Debtors tapped Pachulski Stang Ziehl & Jones, LLP as legal
counsel; Development Specialists, Inc. as interim management
services provider; and Benesch, Friedlander, Coplan & Aronoff LLP
as special transportation counsel. Stretto, Inc. is the Debtors'
claims and noticing agent.
KRT INC: Seeks Chapter 11 Bankruptcy Protection in Wyoming
----------------------------------------------------------
On February 7, 2025, KRT Inc.filed Chapter 11 protection in the
U.S. Bankruptcy Court for the District of Wyoming. According to
court filing, the Debtor reports $7,272,774 in debt owed to 50
and 99 creditors. The petition states funds will be available to
unsecured creditors.
About KRT Inc.
KRT Inc. operates within the specialized freight trucking
industry.
KRT Inc. sought relief under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. ) on February 7, 2025. In its petition, the Debtor
reports total assets of $6,382,948 and total liabilities of
$7,272,774.
Honorable Bankruptcy Judge Cathleen D. Parker handles the case.
The Debtor is represented by:
Clark D. Stith, Esq.
CLARK D. STITH
505 Broadway Street
Rock Springs, WY 82901
Tel: 307-382-5565
Fax: 307-382-5552
E-mail: clarkstith@wyolawyers.com
LUMEN TECHNOLOGIES: Reports Full Year 2024 Net Loss of $55-Mil.
---------------------------------------------------------------
Lumen Technologies, Inc. reported results for the fourth quarter
ended December 31, 2024.
* Drove solid sales growth across enterprise in the fourth
quarter and FY2024, bolstered by improved customer satisfaction
scores in all four segments.
* Strengthened Lumen's balance sheet and overall liquidity
position in 2024. Reduced debt levels and increased access to
capital.
* Continued progress building the AI backbone and cloudifying
telecom, setting the foundation for 2025.
* Continued further adoption of Lumen Digital's
network-as-a-service product in the fourth quarter.
"We made material progress strengthening our financial position,
transforming our corporate functions, and building the backbone for
the AI economy," said Kate Johnson, president and CEO of Lumen.
"This upcoming year, we will continue to drive operational
excellence at Lumen, disrupt the industry by cloudifying telecom,
and deliver connectivity to hyperscalers and enterprises as their
demand for data grows in the era of AI."
Fourth Quarter 2024 Highlights:
* Reported Net Income of $85 million for the fourth quarter
2024, compared to reported Net Loss of $(1.995) billion for the
fourth quarter 2023, which included a non-cash goodwill impairment
charge of $1.9 billion
* Reported diluted earnings per share of $0.09 for the fourth
quarter 2024, compared to diluted loss per share of $(2.03) for the
fourth quarter 2023. Excluding Special Items, diluted earnings per
share was $0.09 for the fourth quarter 2024, compared to $0.08
diluted earnings per share for the fourth quarter 2023
* Generated Adjusted EBITDA of $1.052 billion1 for the fourth
quarter 2024, compared to $1.099 billion1 for the fourth quarter
2023, excluding the effects of Special Items of $132 million and
$211 million, respectively
* Reported Net Cash Provided by Operating Activities of $688
million for the fourth quarter 2024
* Negative Free Cash Flow of $(174) million for the fourth
quarter 2024, excluding cash paid for Special Items of $53 million,
compared to Free Cash Flow of $50 million, excluding cash paid for
Specials Items of $87 million, for the fourth quarter 2023
Full Year 2024 Financial Highlights:
* Reported Net Loss of $(55) million for the full year 2024,
compared to reported Net Loss of $(10.298) billion for the full
year 2023, which included non-cash goodwill impairment charges of
$10.693 billion
* Reported diluted loss per share of $(0.06) for the full year
2024, compared to diluted loss per share of $(10.48) for the full
year 2023. Excluding Special Items, diluted loss per share was
$(0.21) for the full year 2024, compared to $0.20 diluted earnings
per share for the full year 2023
* Generated Adjusted EBITDA of $3.939 billion1 for the full
year 2024, compared to $4.628 billion1 for the full year 2023,
excluding the effects of Special Items of $494 million and $482
million, respectively
* Reported Net Cash Provided by Operating Activities of $4.333
billion2 for the full year 2024
* Generated Free Cash Flow of $1.386 billion2 for the full
year 2024, excluding cash paid for Special Items of $284 million,
compared to Negative Free Cash Flow of $(878) million2, excluding
cash paid for Special Items of $62 million, for the full year 2023
A full-text copy of the Company's report filed on Form 8-K with the
Securities and Exchange Commission is available at:
https://tinyurl.com/45h4mwyb
About Lumen Technologies
Headquartered in Monroe, Louisiana, Lumen Technologies, Inc. --
lumen.com -- is a facilities-based technology and communications
company that provides a broad array of integrated products and
services to its domestic and global business customers and its
domestic mass markets customers. The Company's platform empowers
its customers to swiftly adjust digital programs to meet immediate
demands, create efficiencies, accelerate market access, and reduce
costs, which allows its customers to rapidly evolve their IT
programs to address dynamic changes.
Lumen reported a net loss of $10.30 billion in 2023 following a net
loss of $1.55 billion in 2022.
* * *
In November 2024, S&P Global Ratings placed its ratings on
U.S.-based telecommunications service provider Lumen Technologies
Inc., including the 'CCC+' issuer credit rating, on CreditWatch
with positive implications, indicating the possibility of a
one-notch upgrade. S&P expects to resolve the CreditWatch after
Lumen reports fourth-quarter earnings and provides 2025 guidance.
LUMIO HOLDINGS: Updates Liquidating Plan Disclosures
----------------------------------------------------
Lumio Holdings, Inc., and Lumio HX, Inc. submitted a Revised
Combined Disclosure Statement and Plan of Liquidation dated
February 3, 2025.
The commencement of a chapter 11 case creates an estate that is
composed of the legal and equitable interests of the debtor as of
that date. The Bankruptcy Code provides that the debtor may
continue to operate its business and remain in possession of its
property as a "debtor in possession." After the Petition Date, the
Debtors continued to operate their business as debtors and debtors
in possession.
The Debtors filed these chapter 11 cases to pursue a sale of all or
substantially all of their Assets with the goal of maximizing the
recovery for their Estates and Creditors. To that end, the
Bankruptcy Court entered the Bidding Procedures Order granting
certain of the relief sought in the Sale Motion, including, among
other things, (a) approving the bidding procedures, which
established the key dates and times related to the Sale and
auction, (b) approving assumption procedures, and (c) authorizing
the Debtors’ entry into and performance under the Stalking Horse
Agreement. The Bidding Procedures Order also established a bid
deadline of October 7, 2024.
Following the Sale of substantially all of the Debtors' Assets to
the Purchaser, the Debtors are focused principally on winding down
their Estates. The Liquidating Trust Assets consist of Cash, the
Unsold Claim Assets, and the Other Unsold Assets pursuant to the
Settlement Term Sheet. This Plan provides for the Liquidating Trust
Assets to be distributed to Holders of Allowed Claims in accordance
with the terms of the Plan.
The Revised Combined Disclosure Statement and Plan does not alter
the proposed treatment for unsecured creditors and the equity
holder:
* Class 4 consists of General Unsecured Claims. Each Holder of
an Allowed General Unsecured Claim shall receive, in full and final
satisfaction, settlement, and release of and in exchange for its
Allowed Class 4 Claim, its Pro Rata share of the GUC Recovery. The
allowed unsecured claims total $24,400,000.00 to $111,919,292.02.
Holders of other general unsecured claims are impaired and their
projected recovery is still "unknown."
* Class 6 consists of Equity Interests. On the Effective Date,
all Equity Interests shall be deemed canceled, extinguished, and
discharged and of no further force or effect, and the Holders of
Equity Interests shall not be entitled to receive or retain any
property on account of such Interests.
The Liquidating Trust shall be established and shall become
effective on the Effective Date.
Upon the occurrence of the Effective Date, (a) the members of each
Debtor's board of directors or managers, as the case may be, shall
be deemed to have resigned; and (b) the Liquidating Trust Assets
shall be transferred to the Liquidating Trust in accordance with
this Plan. The Liquidating Trust Assets shall vest in the
Liquidating Trust free and clear of all Liens, claims, and
interests.
Insurance Preservation
Nothing in this Plan shall diminish or impair the enforceability of
any Insurance Policy, including any D&O Insurance Policy, and
related agreements that may cover Claims and Causes of Action
against the Debtors, the D&Os, or any other Entity.
Without limiting the foregoing, and notwithstanding anything else
in this Plan, (i) nothing in this Plan shall limit any insured from
obtaining coverage under any of the Insurance Policies and related
agreements, provided, however, that other orders of the Bankruptcy
Court, whether entered before or after the Effective Date, may
limit insureds from obtaining the proceeds of such coverage for
reasons other than this Plan and shall not be affected by this
Plan; and (ii) nothing in this Plan (including, without limitation,
any provision that purports to be preemptory or supervening or
grants an injunction, discharge, or a release) shall in any way
operate to impair, diminish, or waive, or have the effect of
impairing, diminishing or waiving, the legal or contractual rights,
claims, defenses, liabilities or obligations of any Entity,
including, without limitation, the Debtors, the Committee, the
Prepetition Term Loan Secured Parties, the Liquidating Trust, the
Liquidating Trustee, the D&Os and any insurers, pursuant to any
insurance policies and related agreements, including, without
limitation, the terms, conditions, limitations, exclusions, and
endorsements thereof, that may cover Claims or Causes of Action
against the Debtors, the Estates, the Liquidating Trust, the
Liquidating Trustee, the D&Os, any insurers or any other Entity.
A full-text copy of the Revised Combined Disclosure Statement and
Plan dated February 3, 2025 is available at
https://urlcurt.com/u?l=tHx53c Stretto, Inc., claims agent.
Counsel to the Debtors:
Robert J. Dehney, Sr., Esq.
Matthew B. Harvey, Esq.
Matthew O. Talmo, Esq.
Scott D. Jones, Esq.
Morris, Nichols, Arsht & Tunnell LLP
1201 North Market Street, 16th Floor
PO Box 1347
Wilmington, DE 19899-1347
Tel: (302) 351-9353
Fax: (302) 658-3989
Email: rdehney@morrisnichols.com
About Lumio Holdings
Lumio Holdings, Inc., is a privately-held residential solar
provider in Lehi, Utah, which is fully vertically integrated with a
full suite of photovoltaic solar system sales, installation and
operations.
Lumio Holdings and Lumio HX, Inc. filed Chapter 11 petitions
(Bankr. D. Del. Lead Case No. 24-11916) on Sept. 3, 2024. Jeffrey
T. Varsalone, chief restructuring officer, signed the petitions.
At the time of the filing, the Debtors reported $100 million to
$500 million in both assets and liabilities.
Judge J. Kate Stickles oversees the cases.
The Debtors tapped Morris, Nichols, Arsht & Tunnell, LLP, Houlihan
Lokey Capital, Inc. and C Street Advisory Group as legal counsel,
investment Banker and strategic communications advisor,
respectively. Stretto, Inc. is the claims and noticing agent and
administrative advisor.
M3B SFR LLC: Seeks Chapter 11 Bankruptcy Protection in Georgia
--------------------------------------------------------------
On February 7, 2025, M3B SFR LLC filed Chapter 11 protection in
the U.S. Bankruptcy Court for the Middle District of Georgia.
According to court filing, the Debtor reports between $1 million
and $10 million in debt owed to 50 and 99 creditors. The petition
states funds will be available to unsecured creditors.
About M3B SFR LLC
M3B SFR LLC is a limited liability company.
M3B SFR LLC sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. M.D. Ga. Case No. 25-40082) on February 7, 2025. In
its petition, the Debtor reports estimated assets and liabilities
between $1 million and $10 million each.
The Debtor is represented by:
Thomas T. McClendon, Esq.
JONES & WALDEN LLC
699 Piedmont Avenue NE
Atlanta, GA 30308
Tel: 404-564-9300
E-mail: tmcclendon@joneswalden.com
M4B SFR LLC: Case Summary & Eight Unsecured Creditors
-----------------------------------------------------
Debtor: M4B SFR LLC
1811 East Levee Street
Dallas, TX 75207
Chapter 11 Petition Date: February 12, 2025
Court: United States Bankruptcy Court
Middle District of Georgia
Case No.: 25-40096
Debtor's Counsel: Thomas T. McClendon, Esq.
JONES & WALDEN LLC
699 Piedmont Avenue NE
Atlanta, GA 30308
Tel: 404-564-9300
E-mail: tmcclendon@joneswalden.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by James Bell as chief restructuring
officer.
A full-text copy of the petition, which includes a list of the
Debtor's eight unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/SR6PHZI/M4B_SFR_LLC__gambke-25-40096__0001.0.pdf?mcid=tGE4TAMA
MADISON 33: Seeks to Use $27,500 in Cash Collateral
---------------------------------------------------
Madison 33 Owner, LLC asked the U.S. Bankruptcy Court for the
Southern District of New York for authority to use up to $27,500 in
cash collateral.
The company intends to use the amount to pay the application
deposit of $40,000 and the application fee of $2,500. This payment
is required by the proposal it received from Castellan Capital for
debtor-in-possession financing.
Madison 33 Owner requires financing to complete its penthouse
units, which the company estimated would cost approximately $16
million.
Completing the penthouses is essential to maximizing the property's
value, which is appraised at $75.5 million once finished, up from
$33.1 million in its current state, according to the company's
attorney, Jonathan Pasternak, Esq., at Davidoff Hutcher & Citron
LLP.
A court hearing is set for Feb. 18.
About Madison 33 Owner
Madison 33 Owner, LLC, a New York-based company, filed Chapter 11
petition (Bankr. S.D.N.Y. Case No. 24-11463) on August 26, 2024,
listing total assets of $100,600,000 and total liabilities of
$39,466,304. David Goldwasser, chief restructuring officer, signed
the petition.
Judge Philip Bentley oversees the case.
Jonathan S. Pasternak, Esq., at Davidoff Hutcher & Citron LLP,
represents the Debtor as legal counsel.
MERCURITY FINTECH: Officially Joins Russell Microcap Index
----------------------------------------------------------
Mercurity Fintech Holding Inc. revealed that it has been added to
the FTSE Russell Microcap Index, highlighting an important step
forward in the Company's growth journey.
According to a recent Company press release, "Inclusion in the
Russell Microcap Index positions MFH among a select group of
promising growth companies and enhances its visibility within the
investment community. The Russell indexes are widely recognized as
key benchmarks for investment managers and institutional investors,
who rely on them for index funds and active investment strategies.
As of the end of 2024, the Company has observed increased passive
equity holdings from leading global financial institutions,
including BlackRock, UBS Group AG, and Citigroup, which may be
influenced, in part, by the Company's inclusion in the Russell
Microcap Index. The Company believes its inclusion in the Russell
Microcap Index has positively impacted its shareholder structure
and has contributed to increased recognition and credibility among
institutional investors."
Shi Qiu, CEO of Mercurity Fintech Holding Inc., said, "This
milestone reflects our tremendous growth and highlights the
strength of our business as we continue to expand in AI hardware
intelligent manufacturing and advanced liquid cooling solutions.
Our inclusion in the Russell Microcap Index validates our strategic
direction and underscores the value we're creating in AI hardware
manufacturing sector."
Membership in the Russell Microcap Index, which remains in place
for one year, is subject to annual or periodic reconstitution by
FTSE Russell and depends on the Company meeting the requisite
criteria at the time of such reconstitution. FTSE Russell
determines membership for its Russell indexes primarily by
objective, market-capitalization rankings, and style attributes.
"We are honored to be recognized alongside other promising
companies in the Russell Microcap Index," continued Qiu. "This
achievement opens up new opportunities for visibility and
investment, and we look forward to the continued journey ahead as
we strive to innovate and deliver value to our shareholders."
About Mercurity
Formerly known as JMU Limited, Mercurity Fintech Holding Inc. a
digital fintech company with subsidiaries specializing in
distributed computing and financial brokerage business. In
addition to its fintech operations, the Company is actively
contributing to the evolution of AI hardware technology by
providing secure, cutting-edge solutions in intelligent
manufacturing and advanced liquid cooling systems. The Company's
dedication to compliance, innovation, and operational excellence
ensures that it remains a trusted partner in both the rapidly
transforming digital financial landscape and the dynamic AI
technology sector.
Singapore-based Onestop Assurance PAC, the Company's auditor since
2023, issued a "going concern" qualification in its report dated
April 22, 2024. The report highlighted that the Company has
incurred recurring operating losses and negative cash flows from
operating activities and has an accumulated deficit, which raise
substantial doubt about its ability to continue as a going
concern.
The Company had an accumulated deficit of approximately $677
million as of Dec. 31, 2023, and had a net loss of approximately
$9.4 million and negative cash flows from operating activities of
approximately $2.8 million for the year ended Dec. 31, 2023.
MERIDIAN WEIGHT: Court Directs U.S. Trustee to Appoint PCO
----------------------------------------------------------
Judge Katharine Samson of the U.S. Bankruptcy Court for the
Southern District of Mississippi directed the U.S. Trustee for
Region 5 to appoint a patient care ombudsman for Meridian Weight
Management Center, LLC.
The bankruptcy judge finds that the provisions of Section 333(a)(1)
of the Bankruptcy Code for appointment of a patient care ombudsman
apply to Meridian Weight Management Center after having filed its
bankruptcy petition, indicating that it operates a health care
business.
About Meridian Weight Management Center
Meridian Weight Management Center, LLC sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Miss. Case No.
25-00302) on February 4, 2025, with $0 to $50,000 in assets and
$100,001 to $500,000 in liabilities.
Judge Katharine M. Samson presides over the case.
Douglas M. Engell, Esq. represents the Debtor as legal counsel.
MIDWEST MOBILE: U.S. Trustee Appoints Amanda Wilwert as PCO
-----------------------------------------------------------
Jerry Jensen, the Acting U.S. Trustee for Region 13, appointed
Amanda Wilwert, Esq., as patient care ombudsman for Midwest Mobile
Imaging, LLC.
A patient care ombudsman refers to an individual appointed in
healthcare bankruptcies to ensure the safety of patients. The PCO
monitors the quality of patient care and represents the interest of
patients of the healthcare debtor.
Ms. Wilwert, Esq., at Foulston Siefkin, LLP disclosed in a court
filing that she is a "disinterested person" pursuant to Section
101(14) of the Bankruptcy Code.
The ombudsman may be reached at:
Amanda M. Wilwert, Esq.
Foulston Siefkin, LLP
7500 College Blvd., Ste. 1400
Overland Park, KS 66210
Phone: (913) 253-2181
Email: awilwert@foulston.com
About Midwest Mobile Imaging
Midwest Mobile Imaging, LLC is a full-service mobile diagnostic
x-ray services provider in Springfield, Mo.
Midwest Mobile Imaging sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. W.D. Mo. Case No. 25-60002) on January
3, 2025, with up to $500,000 in assets and up to $10 million in
liabilities. Dan Taylor, a member of Midwest Mobile Imaging, signed
the petition.
Judge Brian T. Fenimore oversees the case.
The Debtor is represented by:
Colin N. Gotham, Esq.
Evans & Mullinix, P.A.
7225 Renner Road, Suite 200
Shawnee, KS 66217
Tel: (913) 962-8700
Fax: (913) 962-8701
Email: cgotham@emlawkc.com
MILLENKAMP CATTLE: Unsecureds to Recover Up to 100% in Toogle Plan
------------------------------------------------------------------
Rabo AgriFinance LLC, in its capacity as agent and lender ("RLOC
Agent" together with any other plan proponent, the "Plan
Proponents"), submitted a Disclosure Statement for Chapter 11 Plan
for Millenkamp Cattle, Inc. and its affiliates dated February 3,
2025.
The Debtors operate a large vertically integrated agribusiness,
comprised of five complementary divisions. As of today, the
Debtors' operations encompass approximately 20,000 acres. The
Debtors maintain cattle operations in three locations in Jerome,
Idaho and a main dairy location in Declo, Idaho.
In April 2024, the Debtors commenced these chapter 11 cases with
assurances that the three largest secured lenders were grossly
oversecured and promised to emerge from bankruptcy in August 2024
under a plan of reorganization that would pay everyone in full.
As of February 3, 2025, creditors, as a whole, are no closer to
payment in full than they were 11 months ago. In December 2024, the
Debtors filed a Plan that continues to make this promise. However,
it is a promise that the Debtors cannot deliver on as the Debtors'
December Plan is incapable of being confirmed for a number of very
material reasons.
Plan Proponents' Toggle Plan provides the Debtors with an
opportunity to consensually restructure their debts, and failing
that, it provides for a sale of the Debtors as a going concern or
in parts for the benefit of the Debtors’ stakeholders.
Under the Toggle Plan, upon entry of the Confirmation Order, the
Toggle Plan and the Confirmation Order shall provide for (a) a
consensual reorganization of the Debtors in accordance with Article
6 of the Toggle Plan if the Reorganization Toggle Requirements and
the Pre-Confirmation Milestones are satisfied (the "Reorganization
Toggle"), (b) a going concern sale of the Debtors' Assets in
accordance with Article 7 of the Toggle Plan if the Reorganization
Toggle Requirements and/or the Pre-Confirmation Milestones are not
satisfied (the "Going Concern 363 Sale Toggle"), and/or (c) the
sale or sales of the Assets of each of the Debtors' business units
if the Plan Administrator does not receive an Approved Going
Concern 363 Sale Qualified Bid by the Going Concern 363 Sale
Qualified Bid Deadline or does not close on such a sale following
entry of a Going Concern 363 Sale Order on or before the Going
Concern 363 Sale Order Deadline in accordance with Article 8 of the
Toggle Plan (the "Business Unit 363 Sale Toggle").
Under the Toggle Plan, the Reorganized Debtors or the Plan
Administrator, as applicable, shall fund Distributions with Cash on
hand from ongoing business operations and (i) the proceeds from the
Pre-Confirmation Transactions under the Reorganization Toggle, (ii)
the proceeds from the Going Concern 363 Sale under the Going
Concern 363 Sale Toggle, and/or (iii) the proceeds from the
Business Unit 363 Sales under the Business Unit 363 Sale Toggle.
The funds generated by these transactions will be used, in part, to
make the Effective Date Distributions, including payment in full of
Allowed Administrative Claims, DIP Claims, Allowed 503(b)(9)
Claims, Allowed Priority Tax Claims, and Allowed Other Priority
Claims.
More specifically, under the Reorganization Toggle, the Toggle Plan
provides the existing owners of the Debtors, including Mr. William
Millenkamp, with an option to reorganize and continue to operate.
To achieve that, the Reorganization Toggle requires that the
existing equity owners contribute $29 million of new equity into
their business and, as they themselves propose, sell a small
percentage of their real estate, Canyonlands and McGregor.
The Reorganization Toggle makes it fair for everyone by requiring
the existing equity owners to invest $29 million – which
represents 7% of the equity value ascribed by the Debtors. The $29
million can come directly from the existing equity owners or from
new investors. By eliminating the need for $45 million of new
loans, the Debtors would emerge with less debt and increase the
likelihood of being able to refinance its significant secured debt
and repaying vendors and suppliers.
Under either sale scenario, the Plan Proponent is committed to
providing a backstop recovery that would guarantee holders of
Allowed General Unsecured Claims receive a pro rata share of a
$4,523,000 recovery from the first proceeds of the Plan Proponent's
collateral.
Through the Toggle Plan, the Plan Proponent provides all
stakeholders with two paths, one in which the Debtors and existing
equity holders reorganize as a going concern by reducing debt and
sharing the risk with their creditors or, as a backup to preserve
recoveries, a path whereby the Debtors' assets are monetized to
maximize the value for all creditors.
Class 9 consists of all General Unsecured Claims, in the
approximate amount of $27 million (the "GUC Principal Amount").
Holders of Allowed Class 9 General Unsecured Claims will receive
the same treatment under the Going Concern 363 Sale Toggle and the
Business Unit 363 Sale Toggle, but will receive different treatment
under the Reorganization Toggle.
* Treatment Under Reorganization Toggle. In full and final
satisfaction of Allowed Class 9 General Unsecured Claims, Holders
shall receive a Pro Rata share of: (a) the Priority-GUC Reserve,
(b) the Preferred Equity GUC Allocation, as reduced by the New
Equity Holder Reallocation, if at all, and (c) the New Equity
Holder Contribution Amount to the extent of the New Equity Holder
Reallocation, if any. This Class will receive a distribution of
100% of their allowed claims.
* Treatment Under Going Concern 363 Sale Toggle. Unless
otherwise agreed or a Holder’s executory contract/unexpired
lease, if any, is assumed, each Holder of an Allowed General
Unsecured Claim will receive its pro rata share of (i) the GUC
Backstop, and (ii) after the Class 4 MetLife Secured Claim, Class 5
RLOC Secured Claims and Class 6 Conterra Secured Claims have been
paid in full from their respective Collateral, including the GUC
Backstop True Up. This Class will receive a distribution of 16% to
100% of their allowed claims.
* Treatment Under Business Unit 363 Sale Toggle. Same
treatment as under the Going Concern 363 Sale Toggle. This Class
will receive a distribution of 3.4% to 100% of their allowed
claims.
Class 9 is Impaired under the Toggle Plan. The Holders of Class 9
Claims are entitled to vote under the Toggle Plan.
On the Effective Date, the Assets and liabilities of the Debtors
shall be deemed substantively consolidated for purposes of
implementing the Toggle Plan. Other than for purposes of
implementing the Toggle Plan, the Debtors and their Assets and
liabilities shall not be deemed consolidated.
Upon entry of for the Confirmation Order, the Toggle Plan and the
Confirmation Order shall provide for (a) a consensual
reorganization of the Debtors in accordance with Article 6 of the
Toggle Plan if the Reorganization Toggle Requirements and the Pre
Confirmation Milestones are satisfied (i.e., the Reorganization
Toggle), (b) a going concern sale of the Debtors' Assets in
accordance with Article 7 of the Toggle Plan if the Reorganization
Toggle Requirements and/or the Pre-Confirmation Milestones are not
satisfied (i.e., the Going Concern 363 Sale Toggle), and/or (c) the
sale or sales of each of the Debtors' business units and/or their
respective Assets if the Plan Administrator does not receive a
Going Concern 363 Sale Qualified Bid by the Going Concern 363 Sale
Qualified Bid Deadline or does not close on such a sale following
entry of a Going Concern 363 Sale Order on or before the Going
Concern 363 Sale Order Deadline in accordance with Article 8 of the
Toggle Plan (i.e., the Business Unit 363 Sale Toggle).
A full-text copy of the Disclosure Statement dated February 3, 2025
is available at https://urlcurt.com/u?l=bseMmu from
PacerMonitor.com at no charge.
Attorneys for Rabo AgriFinance LLC:
Sheila R. Schwager, Esq.
Brent R. Wilson, Esq.
HAWLEY TROXELL ENNIS & HAWLEY LLP
877 W. Main Street, Suite 200
P.O. Box 1617
Boise, ID 83701-1617
Telephone: 208.344.6000
Facsimile: 208.954.5261
Email: sschwager@hawleytroxell.com
bwilson@hawleytroxell.com
Andrew J. Schoulder, Esq.
Francisco Vazquez, Esq.
NORTON ROSE FULBRIGHT US LLP
1301 Avenue of the Americas
New York, NY 10019
Telephone: 212.318.3030
Email: andrew.schoulder@nortonrosefulbright.com
francisco.vazquez@nortonrosefulbright.com
About Millenkamp Cattle
Millenkamp Cattle Inc., is part of a family-owned agriculture
business that can produce more than 1 million pounds of milk per
day.
Millenkamp Cattle Inc. and its affiliates sought relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Idaho Lead Case
No. 24-40158) on April 2, 2024. In the petitions filed by William
J. Millenkamp, manager, Millenkamp Cattle estimated assets between
$10 million and $50 million and estimated liabilities between $500
million and $1 billion.
Judge Noah G. Hillen oversees the cases.
The Debtors tapped Matthew T. Christensen, Esq., at Johnson May,
PLLC as bankruptcy counsel and Givens Pursley as special counsel.
MIRACLE RESTAURANT: Amends Unsecured Claims Pay Details
-------------------------------------------------------
Miracle Restaurant Group, LLC submitted a First Amended Plan of
Reorganization under Subchapter V dated January 31, 2025.
This case was commenced under Subchapter V of Chapter 11 of the
Bankruptcy Code. This Subchapter enables small business debtors to
more effectively reorganize in Chapter 11.
The Original Plan was a "Toggle Plan," with four different
scenarios pursuant to which creditors would receive payments. The
Original Plan envisioned a sale pursuant to the Court's Order (the
"Bid Procedures Order"), pursuant to which the Debtor would market
its assets in an attempt to sell its various markets in
Indiana/Illinois, Texas, and Louisiana/Mississippi.
The marketing of those assets proved unsuccessful and the Debtor
pivoted to what was previously Scenario 2 wherein the Debtor would
continue to operate all of its stores remaining open. After
discussions with landlords regarding lease concessions, the Debtor
was able to gain concessions from the landlords. The concessions
from the landlords (the "Lease Concessions") are essential to the
Debtor being able to continue to operate at those locations in
order to generate sufficient income to fund this Plan.
Under this Plan, Store #8879 in Des Plains, Illinois (the "Des
Plaines Store") and Store #8822, located in Slidell, Louisiana (the
"Slidell Store" and together with the Des Plaines Store, the
"Closing Stores") will be closed. The Equipment Lenders that are
secured by equipment located in the Closing Stores will have their
collateral returned to them in full satisfaction of their secured
claims. Any deficiency will be paid out from distributions to Class
9, General Unsecured Claims. Class 9 claims will be paid from the
Debtor's projected disposable income. The Plan provides for
payments to Class 9 creditors in the amount of $24,010 in year 1,
$128,861 in year 2, and $124,331 in year 3.
Store #9057 in Pearl River, Mississippi (the "Pearl River Store")
will be assumed and assigned to the landlord at that location,
Sunny Time, LLC. This assignment is contingent upon approval from
Arby's for the assignment of the franchise license agreement. In
the event that the proposed sale and assignment is not effectuated,
the lease and license agreement will be rejected and both Sunny
Time, LLC and Arby's will be entitled to rejection damages pursuant
to Section 502(g) of the Bankruptcy Code.
This Plan provides for the treatment of Claims and Interests as
follows, and as more fully described herein:
* Eight classes of Secured Claims (First Franchise, SBA,
Woodvine, and the Equipment Lenders), which will be paid as
provided in Article IV. For the Closing Stores, any equipment
securing any of the Equipment Lenders will be surrendered to the
applicable Equipment Lender or the SBA and the claim of that
Equipment Lender or SBA will be reduced by the fair market value of
the collateral abandoned. For the stores kept open pursuant to this
Plan, the SBA will be paid up to the value of its collateral and
any remaining balance due will be treated as a general unsecured
claim. The Equipment Lenders whose agreements relate to stores that
are kept open will be paid pursuant to the terms of their
respective Agreements; and
* One class of Unsecured Claims that will be paid their pro
rata share of the general unsecured creditor funds.
Class 9 consists of General Unsecured Creditors. The Debtor
estimates its general unsecured claims to total $859,281.00. The
General Unsecured Creditors will be paid their pro rata shares from
the Debtor's projected disposable income, including the ERTC funds.
The General Unsecured Creditors will receive pro rata payments from
the Debtor's projected disposable income over 3 years. Class 9 is
impaired and entitled to vote.
The Debtor shall fund the plan from the ERTC funds and projected
disposable income. The Debtor shall serve as the disbursing agent
under this Plan, whether the Plan is confirmed under Section
1191(a) (consensual confirmation) or Section 1191(b)
(non-consensual confirmation) of the Bankruptcy Code.
A full-text copy of the First Amended Plan dated January 31, 2025
is available at https://urlcurt.com/u?l=D2qoW0 from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Douglas S. Draper, Esq.
Leslie A. Collins, Esq.
Greta M. Brouphy, Esq.
Michael E. Landis, Esq.
Heller, Draper, Patrick, Horn & Manthey, LLC
650 Poydras Street, Suite 2500
New Orleans, LA 70130
Phone: (504) 299-3300
Email: ddraper@hellerdraper.com
lcollins@hellerdraper.com
gbrouphy@hellerdraper.com
mlandis@hellerdraper.com
About Miracle Restaurant Group
Miracle Restaurant Group, LLC owns and operates a fast food
restaurant in Covington, La.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. La. Case No. 24-11158) on June 20,
2024, with $1 million to $10 million in both assets and
liabilities. Dwayne Murray, Esq., at Murray & Murray, LLC, serves
as Subchapter V trustee.
Judge Meredith S. Grabill presides over the case.
The Debtor tapped Douglas S. Draper, Esq., at Heller, Draper &
Horn, LLC as legal counsel and Peak Franchise Capital, LLC as
financial advisor.
MONDEE HOLDINGS: Tuesday Investor Seeks Appointment of Examiner
---------------------------------------------------------------
Tuesday Investor LP, a preferred shareholder of Mondee Holdings,
Inc., filed with the U.S. Bankruptcy Court for the District of
Delaware a motion to appoint an examiner in the Chapter 11 cases of
the company and its affiliates.
The shareholder claims that the Debtors, which are still overseen
by Prasad Gundumogula, chairman of the Board of Directors, have
resolved to pursue a restructuring plan that is antithetical to
fundamental bankruptcy principles, and benefits Gundumogula (and
other insiders) at the direct expense of senior stakeholders.
Tuesday Investor seeks the appointment of an examiner in hopes that
this less drastic alternative may help shepherd the Debtors away
from these patently impermissible actions, and towards a course of
action that is consistent with the Bankruptcy Code and beneficial
for all interested parties.
Appointment of an examiner is particularly appropriate given its
purpose of providing "extra protection to stockholders of public
companies through the mechanism of an independent fiduciary," the
shareholder said.
Moreover, the court should appoint an examiner not only because it
is required but also because such appointment is in the interests
of unsecured creditors and every equity holder not named
Gundumogula.The Debtors themselves concede the need for an
investigation, including the SEC's investigation into Gundumogula.
Yet, the Debtors have simultaneously determined to effectively
extinguish, for no consideration, all claims and causes of action
against the very insiders that governed, and many of whom still
govern, the Debtors, according to Tuesday Investor.
Tuesday Investor asserts that the sale and plan that the companies
are asking this Court to approve on an expedited timeframe offers
no distributions for unsecured creditors or preferred equity
holders. Meanwhile, Gundumogula, a fiduciary for these stakeholders
who ran the Debtors into the ground (and potentially plundered
their assets), and who may have engaged in improper insider trading
and manipulation of the Debtors' stock, will come out owning 75% of
the effectively reorganized Debtors, and will be completely
absolved (along with other Debtor insiders) of any potential
liability to the Debtors.
Tuesday Investor further asserts that the only creditors who will
receive a dime will be the pre-bankruptcy lenders who improperly
seek to expand their collateral package to assist Gundumogula in
squashing all estate claims and causes of action against him
through a proposed DIP financing arrangement, which funds nothing
more than the monetization of their own collateral.
"This is all wrong, and in violation of the absolute priority rule
of the Bankruptcy Code, which requires that unsecured creditors and
preferred equity holders receive distributions in full before
common equity receives any property," Tuesday Investor said.
Counsel to Tuesday Investor LP:
Mark L. Desgrosseilliers, Esq.
Robert A. Weber, Esq.
Hercules Plaza, Esq.
Chipman Brown Cicero & Cole, LLP
1313 North Market Street, Suite 5400
Wilmington, DE 19801
Telephone: (302) 295-0191
Email: desgross@chipmanbrown.com
weber@chipmanbrown.com
-- and --
Benjamin I. Finestone, Esq.
Deborah Newman, Esq.
Lindsay M. Weber, Esq.
Zachary Russell, Esq.
Quinn Emanuel Urquhart & Sullivan, LLP
295 Fifth Avenue
New York, NY 10016
Telephone: (212) 849-7000
Email: benjaminfinstone@quinnemanuel.com
deborahnewman@quinnemanuel.com
lindsayweber@quinnemanuel.com
zacharyrussell@quinnemanuel.com
-- and --
Gregg M. Galardi, Esq.
Matthew M. Roose, Esq.
Ropes & Gray LLP
1211 Avenue of the Americas
New York, New York 10036
Telephone: (212) 596-9000
Email: gregg.galardi@ropesgray.com
matthew.roose@ropesgray.com
About Mondee Holdings Inc.
Mondee Holdings Inc. operates as a travel technology company in the
leisure travel markets in the United States and internationally.
Founded in 2011, Mondee Holdings acquired several major businesses,
including the largest air ticket consolidators in the United States
and Canada. Mondee Holdings are headquartered in Austin, Texas,
with additional offices in Canada, Brazil, Mexico, India, and
Thailand.
Mondee Holdings Inc. and several of its affiliates sought relief
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Case
No. 25-10047) on January 14, 2025. In the petitions signed by
Mohsin Meghji as chief restructuring officer, the Debtors reported
total assets of $362,804,000 and total debts of $358,688,000 as of
June 30, 2024.
The Hon. J Kate Stickles presides over the cases.
The Debtors has tapped Young Conaway Stargatt & Taylor, LLP as
their Delaware bankruptcy counsel; and Fried, Frank, Harris,
Shriver & Jacobson LLP as their general bankruptcy counsel. M3
Advisory Partners, LP serves as restructuring advisor to the
Debtors; Piper Sandler & Co acts as investment banker; and Kroll
Restructuring Administration LLC acts as notice and claims agent.
NEUROONE MEDICAL: Merchant Adventure Fund Holds 13.6% Stake
-----------------------------------------------------------
Merchant Adventure Fund, L.P. disclosed in a Schedule 13G/A filed
with the U.S. Securities and Exchange Commission that as of
December 31, 2024, it beneficially owned 4,200,000 shares of
NeuroOne Medical Technologies Corporation's common stock,
representing 13.6% of the shares outstanding.
Merchant Adventure may be reached at:
Matthew Zuck
Sole Member
Merchant Adventure Fund LP
530 Lytton Avenue, 2nd Floor
Palo Alto, CA 94301
Tel: 650-843-9825
A full-text copy of Merchant Adventure's SEC Report is available
at:
https://tinyurl.com/56ezbsa9
About NeuroOne Medical Technologies
Headquartered in Eden Prairie, MN, NeuroOne Medical Technologies
Corporation -- nmtc1.com -- is developing and commercializing
minimally invasive and hi-definition solutions for EEG recording,
brain stimulation and ablation solutions for patients suffering
from epilepsy, Parkinson's disease, dystonia, essential tremors,
chronic pain due to failed back surgeries and other related
neurological disorders that may improve patient outcomes and reduce
procedural costs. The Company may also pursue applications for
other areas such as depression, mood disorders, pain, incontinence,
high blood pressure, and artificial intelligence.
Minneapolis, Minnesota-based Baker Tilly US, LLP, the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated Dec. 17, 2024, citing that the Company had recurring
losses from operations and an accumulated deficit, expects to incur
losses for the foreseeable future and requires additional working
capital. These raise substantial doubt about the Company's ability
to continue as a going concern.
As of June 30, 2024, NeuroOne Medical Technologies had $4,912,597
in total assets, $1,900,870 in total liabilities, and $3,011,727 in
total stockholders' equity.
NEUROONE MEDICAL: Regains Compliance With Nasdaq Listing Standards
------------------------------------------------------------------
NeuroOne Medical Technologies Corporation announced that it has
regained compliance with the Nasdaq Capital Market's continued
listing standard for the minimum share price requirements under
Nasdaq Listing Rule 5550(a)(2).
The Company received a letter on February 3, 2025 from the Listings
Qualifications Hearing Department of Nasdaq that the Company's bid
price deficiency had been cured and that the Company was in
compliance with all applicable listing standards.
Based on the foregoing, the previously scheduled Nasdaq hearing has
been cancelled and the matter is now closed.
"We are pleased to announce that we have regained compliance with
Nasdaq's share price listing standards and are grateful to our
shareholders for their patience during this time," said Dave Rosa,
Chief Executive Officer of NeuroOne. "We remain focused on driving
sustainable shareholder value over the long term as we successfully
penetrate the market with our disruptive OneRF Ablation System, the
first and only FDA-cleared device for RF ablation in the brain.
Following our recent announcement that preliminary unaudited first
quarter fiscal 2025 total revenue increased to a record $6.2
million--which includes $3.2 million of product revenue and a
one-time $3.0 million payment of license revenue--we look forward
to further updating shareholders of our progress on our upcoming
earnings call, which will be held February 12, 2025, at 8:30 am
eastern time."
About NeuroOne Medical Technologies
Headquartered in Eden Prairie, MN, NeuroOne Medical Technologies
Corporation -- nmtc1.com -- is developing and commercializing
minimally invasive and hi-definition solutions for EEG recording,
brain stimulation and ablation solutions for patients suffering
from epilepsy, Parkinson's disease, dystonia, essential tremors,
chronic pain due to failed back surgeries and other related
neurological disorders that may improve patient outcomes and reduce
procedural costs. The Company may also pursue applications for
other areas such as depression, mood disorders, pain, incontinence,
high blood pressure, and artificial intelligence.
Minneapolis, Minnesota-based Baker Tilly US, LLP, the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated Dec. 17, 2024, citing that the Company had recurring
losses from operations and an accumulated deficit, expects to incur
losses for the foreseeable future and requires additional working
capital. These raise substantial doubt about the Company's ability
to continue as a going concern.
As of June 30, 2024, NeuroOne Medical Technologies had $4,912,597
in total assets, $1,900,870 in total liabilities, and $3,011,727 in
total stockholders' equity.
NEWS DIRECT: Court Extends Cash Collateral Access to March 7
------------------------------------------------------------
News Direct Corp. got the green light from the U.S. Bankruptcy
Court for the District of Connecticut, Bridgeport Division, to use
$127,479.90 in cash collateral to pay its operating expenses.
The order signed by Judge Julie Manning authorized the company to
use cash collateral for the period from Feb. 6 to March 7 in
accordance with its budget.
Old National Bank, a secured creditor, was granted a replacement
lien on the company's personal property to protect the bank's
interests in the cash collateral.
As additional protection, the bank will receive the sum of $20,000,
payable in biweekly installments in the first and third week of
every month.
The next hearing is scheduled for March 4.
About News Direct Corp.
News Direct Corp. is a news and content distribution platform in
Norwalk, Conn.
News Direct sought relief under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Conn. Case No. 25-50005) on January 3, 2025, with
up to $50,000 in assets and $1 million to $10 million in
liabilities.
Judge Julie A. Manning handles the case.
The Debtor is represented by:
Scott M. Charmoy, Esq.
Charmoy & Charmoy
Tel: 203-255-8100
Email: scottcharmoy@charmoy.com
NOVABAY PHARMACEUTICALS: Stockholders Reject Liquidation Plan
-------------------------------------------------------------
NovaBay Pharmaceuticals, Inc. disclosed in a Form 8-K Report filed
with the U.S. Securities and Exchange Commission that on November
22, 2024, it held its Special Meeting of Stockholders, whereby the
Company's stockholders were asked to consider three proposals, each
of which is described in more detail in the Company's definitive
proxy statement on Schedule 14A for the Special Meeting filed with
the Securities and Exchange Commission on October 16, 2024, as
supplemented from time to time, including by the supplement to the
Special Meeting Proxy Statement dated as of November 12, 2024.
The three proposals are as follows:
* Proposal One sought stockholder approval for the sale of the
Company's eyecare products sold under the Avenova brand and related
assets to PRN Physician Recommended Nutriceuticals, LLC, which
constituted substantially all of the Company's revenue generating
and operating assets.
* Proposal Two sought stockholder approval to approve the
liquidation and dissolution of the Company under Delaware law
pursuant to the Plan of Complete Liquidation and Dissolution of the
Company, which, if approved, would authorize the Company to
liquidate and dissolve in accordance with the Plan of Dissolution.
* Finally, Proposal Three sought stockholder approval to
provide the Company's Board of Directors with discretionary
authority to adjourn the Special Meeting from time to time to
establish a quorum or to permit further solicitation of proxies if
there were not sufficient votes in favor of Proposal One and/or
Proposal Two.
As previously reported, the Special Meeting initially convened on
November 22, 2024, where a quorum was present, and the Company
received stockholder approval for Proposal Three; however, it had
not received greater than 50% of all outstanding shares of the
Company's common stock voting in favor of Proposal One or Proposal
Two, which was the required minimum vote of stockholders to approve
each of Proposal One and Proposal Two. The Special Meeting was
adjourned only with respect to the vote on Proposal One and
Proposal Two until it was reconvened on December 18, 2024, and then
further adjourned and reconvened on January 16, 2025, at which time
Proposal One providing for the Asset Sale Transaction was approved
by stockholders. The Special Meeting was further adjourned only
with respect to Proposal Two providing for the Liquidation and
Dissolution, until it was reconvened on January 30, 2025.
There were 4,885,693 outstanding shares of the Company's common
stock entitled to vote and there were 2,763,123 shares present in
person or by proxy at the Reconvened Meeting, representing
approximately 57% of the shares outstanding and entitled to vote.
At the Company's Reconvened Meeting held on January 30, 2025, the
Company did not receive the requisite vote of stockholders to
approve Proposal Two, which proposal provided for the Liquidation
and Dissolution of the Company pursuant to the Plan of Dissolution.
Proposal Two received approval by stockholders representing
approximately 49% of the outstanding shares of the Company's common
stock at the Special Meeting. Of the votes cast at the Special
Meeting by holders of the Company's common stock, approximately 88%
of those shares voted in favor of Proposal Two.
With the Company having completed the sale of substantially all of
its assets upon the closing of the Asset Sale Transaction on
January 17, 2025, and the closing of the sale of the Company's
wound care trademarks and wound care inventory to Phase One Health,
LLC, a Tennessee limited liability company, on January 8, 2025, the
Board, upon further analysis of the best opportunity to maximize
the remaining value for the Company and its stockholders, among the
other alternatives currently available, determined that it is in
the best interests of the Company and its stockholders for the
Company to continue pursuing the voluntary Liquidation and
Dissolution pursuant to the Plan of Dissolution. Accordingly, the
Company intends to hold a new special meeting of stockholders to
obtain approval of the Liquidation and Dissolution, as discussed
below.
If the stockholders approve the Liquidation and Dissolution at the
new special meeting, the Company currently plans to file a
Certificate of Dissolution with the Secretary of State of Delaware
and proceed with the Liquidation and Dissolution in accordance with
the Plan of Dissolution and Delaware law as soon as practical
following the new special meeting; however, such filing may be
delayed or not filed at all as determined by the Board in its sole
discretion. In general terms, if the Company dissolves pursuant to
the Plan of Dissolution, the Company will cease conducting its
business, wind up its affairs, dispose of its non-cash assets, pay
or otherwise provide for its obligations, and distribute its
remaining assets, if any, during a post-dissolution period.
Pursuant to the statutory process, the distribution of the
Company's assets will likely take a minimum of nine (9) months, as
required by the Delaware courts and Delaware law. With respect to
the Liquidation and Dissolution, the Company will continue to
follow the dissolution and winding up procedures prescribed by the
Delaware court under Delaware law.
Through the Liquidation and Dissolution process, the Company
intends, to the fullest extent possible, to pay its creditors and
discharge its liabilities, as well as return as much value that may
remain to stockholders and other stakeholders, including unsecured
convertible note holders and warrant holders, consistent with the
stockholder approved Plan of Dissolution. Assuming that the
Liquidation and Dissolution goes forward in accordance with the
stockholder approved Plan of Dissolution and Delaware law, then the
Company plans to update its stockholders, debt holders, warrant
holders and preferred stockholder with additional information and
written notice as the court supervised Liquidation and Dissolution
progresses. Any distributions from the Company will be made to its
stockholders according to their holdings of common stock and
preferred stock as of the date the Company files a Certificate of
Dissolution, which due to the Liquidation and Dissolution, shall
also be the date on which the Company closes its stock transfer
books and discontinues recording transfers of its common stock,
except for transfers by will, intestate succession or operation of
law. Accordingly, there will be limited ability to sell or transfer
Company securities after the Certificate of Dissolution is filed.
The ability of the Company to proceed with the Liquidation and
Dissolution under Delaware law is subject to the Company first
receiving stockholder approval. The Company intends to file a new
proxy statement with the SEC with respect to the new special
meeting of the Company's stockholders, at which meeting the
Company's stockholders will be asked to, among other items,
consider and approve the Liquidation and Dissolution pursuant to
the Plan of Dissolution. The Board reserves the right to abandon
the Liquidation and Dissolution and the Plan of Dissolution, even
if approved by the Company's stockholders, if the Board, in its
discretion, determines that the Liquidation and Dissolution or the
Plan of Dissolution is no longer in the best interests of the
Company and its stockholders.
About Novabay
Headquartered in Emeryville, California, NovaBay Pharmaceuticals,
Inc. -- http://www.novabay.com/-- develops and sells
scientifically created and clinically proven eyecare and skincare
products. The Company's leading product, Avenova Antimicrobial Lid
and Lash Solution, or Avenova Spray, is proven in laboratory
testing to have broad antimicrobial properties as it removes
foreign material, including microorganisms and debris, from the
skin around the eye, including the eyelid.
San Francisco, California-based WithumSmith+Brown, PC, the
Company's auditor since 2010, issued a "going concern"
qualification in its report dated March 26, 2024, citing that the
Company has sustained operating losses for the majority of its
corporate history and expects that its 2024 expenses will exceed
its 2024 revenues, as the Company continues to invest in its
commercialization efforts. Additionally, the Company expects to
continue incurring operating losses and negative cash flows until
revenues reach a level sufficient to support ongoing growth and
operations. Accordingly, the Company has determined that its
planned operations raise substantial doubt about its ability to
continue as a going concern.
As of September 30, 2024, NovaBay Pharmaceuticals had $3.9 million
in total assets, $2.8 million in total liabilities, and $1.1 in
total stockholders' equity.
OCEAN POWER: Secures $2 Million PowerBuoy Orders in Latin America
-----------------------------------------------------------------
Ocean Power Technologies, Inc. announced a new partnership, with an
initial $2 million of purchase orders in Latin America. The
purchase orders are for OPT's Next Generation PowerBuoys, which
utilize a combination of wave, solar, and wind power generation.
The Next Generation PowerBuoy is a proven product that can be
deployed for long durations in water depths ranging from coastal to
deep ocean water and support payload above and below the surface.
The systems can be equipped with a range of communication solutions
This landmark order not only underscores the growing demand for
OPT's innovative solutions but also solidifies the company's
position as a leader in the marine intelligence and robotics
industry.
Commenting on this significant achievement, Philipp Stratmann,
President and CEO of Ocean Power Technologies, expressed his
enthusiasm, stating, "We are thrilled to add PowerBuoys to our
offering in Latin America. This order builds on the growth of our
WAM-V solutions that we have seen in this region recently. We
believe adding PowerBuoys will enable our customers to add
permanent monitoring and marine intelligence solutions into the
existing roaming capabilities we have started to deliver to the
region. This order highlights our continued commitment to
delivering unparalleled solutions to the region that redefine
possibilities in marine intelligence."
With a proven track record of delivering state-of-the-art solutions
tailored to meet the evolving needs of diverse industries, OPT
remains at the forefront of innovation in the maritime sector. The
company's dedication to excellence and customer satisfaction
continues to drive its success, enabling it to forge strategic
partnerships and expand its global footprint.
About Ocean Power Technologies
Ocean Power Technologies, Inc. --
https://oceanpowertechnologies.com/ -- provides intelligent
maritime solutions and services that enable safer, cleaner, and
more productive ocean operations for the defense and security, oil
and gas, science and research, and offshore wind markets. The
Company's PowerBuoy platforms provide clean and reliable electric
power and real-time data communications for remote maritime and
subsea applications. The Company also offers WAM-V autonomous
surface vessels (ASVs) and marine robotics services. The Company's
headquarters is located in Monroe Township, New Jersey, with an
additional office in Richmond, California.
Iselin, New Jersey-based EisnerAmper LLP, the Company's auditor
since 2020, issued a "going concern" qualification in its report
dated July 25, 2024, citing that the Company has recurring net
losses and net cash flow used in operations that raise substantial
doubt about its ability to continue as going concern.
As of Oct. 31, 2024, Ocean Power Technologies had $26.95 million in
total assets, $4.83 million in total liabilities, and $22.12
million in total shareholders' equity.
OCUGEN INC: State Street Corp. Holds 2% Equity Stake
----------------------------------------------------
State Street Corporation disclosed in a Schedule 13G filed with the
U.S. Securities and Exchange Commission that as of December 31,
2024, it beneficially owned 5,866,108 shares of Ocugen Inc.'s
common stock, representing 2% of thee shares outstanding.
State Street may be reached at:
Elizabeth Schaefer
Senior Vice President, Chief Accounting Officer
State Street Corporation
1 Congress Street
Suite 1
Boston MA 02114
Tel: 617 786-3000
A full-text copy of State Street's SEC Report is available at:
https://tinyurl.com/4293mcch
About Ocugen Inc.
Malvern, Pa.-based Ocugen, Inc. is a biotechnology company focused
on discovering, developing, and commercializing novel gene and cell
therapies, biologics, and vaccines that improve health and offer
hope for patients across the globe. The Company's technology
pipeline includes: Modifier Gene Therapy Platform, Novel Biologic
Therapy for Retinal Diseases, Regenerative Medicine Cell Therapy
Platform, and Inhaled Mucosal Vaccine Platform.
Philadelphia, Pennsylvania-based Ernst & Young LLP, the Company's
auditor since 2018, issued a "going concern" qualification in its
report dated April 16, 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.
As of September 30, 2024, Ocugen had $61.9 million in total assets,
$21.3 million in total liabilities, and $40.6 million in total
stockholders' equity.
OMEGA THERAPEUTICS: Seeks Chapter 11 Bankruptcy w/ Over $140MM Debt
-------------------------------------------------------------------
Emlyn Cameron of Law360 reports that biotechnology company Omega
Therapeutics filed for Chapter 11 bankruptcy in Delaware on
February 10, 2025, citing over $140 million in debt.
The company also notified the U.S. Securities and Exchange
Commission of a restructuring agreement with an affiliate of its
controlling stockholder, the report states.
About Omega Therapeutics
Omega Therapeutics Inc. is a biotechnology company in its
development stages, leading innovation in a novel approach to
leverage mRNA therapeutics as programmable epigenetic treatments
through its OMEGA Epigenomic Programming platform. The OMEGA
platform harnesses the power of epigenetics, the mechanism that
controls gene expression and every aspect of an organism's life
from cell genesis, growth, and differentiation to cell death. The
OMEGA platform enables control of fundamental epigenetic processes
to correct the root cause of disease by returning aberrant gene
expression to a normal range without altering native nucleic acid
sequences.
Omega Therapeutics Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 25-10211) on February 10,
2025. In its petition, the Debtor reports total assets as of Jan.
28, 2025 amounting to $137,529,941 and total debts as of Jan. 28,
2025 of $140,421,354.
Honorable Bankruptcy Judge Brendan Linehan Shannon handles the
case.
The Debtor is represented by Derek C. Abbott, Esq., Eric D.
Schwartz, Esq., Andrew R. Remming, Esq., Daniel B. Butz, Esq.,
Jonathan M. Weyand, Esq., and Luke Brzozowski, Esq., at MORRIS,
NICHOLS, ARSHT & TUNNELL LLP, in Wilmington, Delaware.
The Debtor's Restructuring Advisor is TRIPLE P RTS, LLC
The Debtor's Investment Banker is TRIPLE P SECURITIES, LLC.
The Debtor's Special Counsel is LATHAM & WATKINS LLP.
The Debtor's Claims Agent & Administrative Advisor is KROLL
RESTRUCTURING ADMINISTRATION LLC.
OUTFRONT MEDIA: Industry Veteran Nick Brien Named Interim CEO
-------------------------------------------------------------
OUTFRONT Media Inc. disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that the Board of Directors
of the Company appointed Nicolas Brien to serve as Interim Chief
Executive Officer of the Company, effective as of February 10,
2025.
Mr. Brien, 63, has served on the Board since October 2014, and has
held senior leadership roles at some of the most influential global
organizations in the advertising, media, advertising technology and
digital marketing industries, where he was responsible for leading
the organizations through periods of rapid expansion and change.
Mr. Brien served as Chief Executive Officer of Enthusiast Gaming
Holdings Inc., a gaming media and entertainment company, from March
2023 to January 2024. Previously, he served as Chief Executive
Officer of Amobee, Inc., an advertising technology company, from
July 2021 to October 2022. He served as Chief Executive Officer,
the Americas and U.S., of Dentsu Aegis Network Ltd., one of the
world's largest advertising, media and digital marketing agencies,
from August 2017 to December 2019, and as a consultant to Dentsu
Aegis Network Ltd. from January 2020 to March 2020. He also served
as the Chief Executive Officer of iCrossing, a subsidiary of Hearst
Corporation, and as President of Hearst Magazines Marketing
Services, a division of Hearst Corporation, from March 2015 to July
2017. Prior to that, he served as Chairman and Chief Executive
Officer of McCann Worldgroup from April 2010 through November 2012,
and as Chief Executive Officer of IPG Mediabrands from 2008 to
2010. Mr. Brien also served as Chief Executive Officer of Universal
McCann from 2005 to 2008.
"Nick brings a perfect balance of marketing strategy, business
acumen, and expertise in ad tech and digital innovation, making him
the ideal leader for OUTFRONT during this important transition.
When the Board initiated the search for new leadership, Nick
stepped forward with a bold vision for the company. It was clear he
could immediately step in as Interim CEO to spearhead an ambitious
set of initiatives, driving continued momentum and progress in the
company's transformation and growth," said Michael Dominguez, who
was named Chairman of the Board as of February 10, 2025.
"The out-of-home medium is bold, impactful, and is quickly evolving
into a significant digital channel. Our unmissable creative
canvases spark conversations and enable advertisers to engage
consumers in ways that drive superior campaign performance while
building brand loyalty," said Mr. Brien. "By operating as a
tech-enabled, data-driven, and ideas-led company, we have the
opportunity to elevate OUTFRONT's strategic importance for brands
and partners while unlocking new avenues for growth."
This leadership transition follows the previously announced
retirement of Jeremy Male, who leaves behind a lasting legacy at
OUTFRONT Media. Most notably, Male oversaw the transformation of
CBS Outdoor Americas into OUTFRONT Media and led the company
through a successful initial public offering. Under his leadership,
OUTFRONT Media established itself as a leader in the out-of-home
advertising industry, resulting in significant growth throughout
his tenure
As Interim CEO, Brien joins an industry-leading team renowned for
their exceptional sales expertise, innovative design teams, and
client-focused consultative approach. With his established
relationships across the executive management team, Brien will work
closely with leaders to ensure a seamless transition while the
Board considers him alongside other candidates for the permanent
role as part of a global search. To further strengthen the
company's leadership during this pivotal period, Chief Financial
Officer, Matthew Siegel, will take on expanded operational
responsibilities.
Under Brien's leadership, the company is focused on amplifying the
power of out-of-home to drive brand awareness and measurable
performance, accelerating its technological evolution, and building
on its strong foundation of creativity and innovation--all while
continuing to deliver exceptional value to agencies, brands, key
stakeholders, and stockholders.
There is no arrangement or understanding with any person pursuant
to which Mr. Brien was appointed as Interim CEO of the Company. In
addition, there are no family relationships between Mr. Brien and
any director or executive officer of the Company, and there are no
transactions between Mr. Brien and the Company requiring disclosure
under Item 404 of Regulation S-K.
In connection with Mr. Brien's appointment, the Company entered
into a letter agreement with him, dated as of January 31, 2025,
which provides for his employment as the Company's Interim CEO from
the Effective Date until the first to occur of the appointment of
another individual as Chief Executive Officer of the Company, Mr.
Brien's voluntary resignation (upon 30 days' written notice), Mr.
Brien's "termination for cause", or due to Mr. Brien's death or
disability. Mr. Brien will receive a monthly base salary of $66,667
and will be eligible to receive an annual cash bonus solely for
2025 with an annual bonus target opportunity equal to 100% of his
earned base salary. In addition, Mr. Brien will be granted a
one-time award of restricted share units under the OUTFRONT Media
Inc. Amended and Restated Omnibus Stock Incentive Plan with a grant
date fair value equal to $1,333,333 that will vest on the one-year
anniversary of the grant date. The terms and conditions of any
long-term incentive equity compensation awarded to Mr. Brien are
set forth in the Plan and the related equity award terms and
conditions. In addition, Mr. Brien will be entitled to participate
in arrangements for benefits, business expenses and perquisites
generally available to our other senior executives of the Company.
In the event Mr. Brien's employment is terminated due to the
appointment of a new Chief Executive Officer or his death or
disability, Mr. Brien will remain eligible to receive the 2025 Cash
Bonus and the One-Time Award will remain outstanding and continue
to vest based on his service as a member of the Board, provided
that if he is no longer serving as a member of the Board at such
time or ceases to serve as a member of the Board after such time
but before the one-year anniversary of the grant date of the
One-Time Award, the One-Time Award will vest pro-rata, based on the
number of days elapsed from the grant date through and including
the date his role as Interim CEO or as a member of the Board
terminates (whichever is later).
The Letter Agreement also contains a covenant that restricts Mr.
Brien from solicitating employees during his employment and for one
year following the termination of his employment.
As previously disclosed on December 17, 2024, Jeremy J. Male, will
retire from his positions as the Company's Chief Executive Officer
and Chairman and as a member of the Board on the Effective Date and
will thereafter serve as an advisor to the Board until March 31,
2025.
Michael J. Dominguez, a current member of the Board, has been
appointed to serve as Chairman of the Board to replace Mr. Male,
effective as of the Effective Date. Mr. Brien stepped down as a
member of the Compensation Committee of the Board, effective
January 31, 2025, in connection with his appointment as Interim
CEO.
About OUTFRONT Media Inc.
Headquartered in New York, OUTFRONT Media Inc. leases advertising
space on out-of-home advertising structures and sites.
OUTFRONT Media reported a net loss attributable to the Company of
$430.4 million for the year ended December 31, 2023, compared to a
net income of $147.9 million for the year ended December 31, 2022.
As of September 30, 2024, OUTFRONT Media had $5.2 billion in total
assets, $4.5 billion in total liabilities, $13.5 million in
redeemable noncontrolling interests, $119.8 million of preferred
stock, and $618.2 million in total shareholders' equity.
* * *
Egan-Jones Ratings Company, on September 10, 2024, maintained its
'CCC' foreign currency and local currency senior unsecured ratings
on debt issued by OUTFRONT Media Inc.
PAN AM DENTAL: Files Emergency Bid to Use Cash Collateral
---------------------------------------------------------
Pan Am Dental, P.A. asked the U.S. Bankruptcy Court for the Western
District of Texas, San Antonio Division, for authority to use cash
collateral to pay its operating expenses.
During the COVID-19 pandemic, the Debtor faced financial
difficulties due to a decline in patient numbers. The Debtor's
principal, a U.S. Army reservist currently on active duty, managed
the business’s finances and made adjustments, including
relocating the primary office and closing another location.
However, the Debtor took out two merchant cash advance loans to
cover debts and meet cash flow needs. Unable to keep up with daily
payments and high interest, the MCA loans caused issues with cash
flow, preventing the Debtor from paying employees and overhead. One
MCA interfered with the Debtor's payments from credit card
processors and insurance companies, forcing the Debtor to open a
new account and file for bankruptcy protection to prevent ceasing
operations.
The parties that assert an interest in the cash collateral are
Pioneer Bank, SSB (currently Sunflower Bank), the LCF Group, Inc.,
and CT Corporation System as representative (creditor not known,
but believed to be Fundworks).
The Debtor proposed to provide adequate protection to all parties
with an interest in cash collateral in the following manner:
a. All creditors with an interest in cash collateral will be
granted a replacement lien to the same extent, priority and
validity as its pre-bankruptcy liens;
b. The Debtor requests permission to continue to pay lenders
believed to hold claims secured by equipment, being Patterson
Dental, RB Finance, Align Technology and Weave RB, the regular debt
service payments due in order to provide adequate protection to
such creditors until a plan is confirmed in its Chapter 11 case;
c. The Debtor also requests permission to continue its relationship
with its suppliers in the ordinary course of its business and pay
such suppliers on the same terms which existed before the
commencement of the case;
d. The Debtor will continue to operate its business in the ordinary
course of business thus generating additional cash collateral; and
e. The Debtor will maintain insurance upon the property giving rise
to the cash collateral.
A court hearing is scheduled for March 17.
About Pan Am Dental P.A.
Pan Am Dental, P.A. was incorporated on October 7, 2002, and has
conducted business as a dental office for almost 24 years.
Pan Am Dental filed Chapter 11 petition (Bankr. W.D. Texas Case No.
25-50270) on February 6, 2025, listing up to $500,000 in assets and
up to $1 million in liabilities. Jesus Peralez, Jr., president of
Pan Am Dental, signed the petition.
Judge Michael M. Parker oversees the case.
H. Anthony Hervol, Esq., at Law Office of H. Anthony Hervol,
represents the Debtor as bankruptcy counsel.
PANZER BUILDING: Unsecureds Will Get 13% of Claims in Plan
----------------------------------------------------------
Panzer Building Corp. submitted an Amended Disclosure Statement
describing Amended Plan of Reorganization dated February 3, 2025.
On November 6, 2023, before this case was filed, the Receiver filed
a motion to hold the Debtor and Nancy Haber, the Debtor's
principal, in contempt for failing to turnover possession and
management, among other things.
In his affidavit in support of his application, the Receiver
alleged that the Debtor and Ms. Haber: "refused and failed to
provide keys, leases, agreements, security deposits, and
correspondence to the Receiver," "refused and failed to provide an
accounting for all rents since August 7, 2023," and "continued to
issue leases and collect rents to date. In support of his motion,
the Receiver provided documentation consisting of with vendor
proposals that emergency repairs were needed to repair "leaks in
the wall and roof" and elevator brake shoes, motor shaft and
bearings. The Debtor and Ms. Haber denied the Receiver's
allegations of non-cooperation and interference.
The Lender moved to reinstate the Receiver. The Debtor and Ms.
Haber continued to deny the Receiver's allegations of non
cooperation and interference. However, in an effort to work
cooperatively with the Lender, the Debtor and the Lender settled
the motion under a consent order that confirmed the removal of the
Receiver, but authorized the Lender to operate the Property as
mortgagee in possession under the direction of David Goldwasser,
the Lender's Loan Workout Manager. The consent Order was entered on
January 12, 2024. Mr. Goldwasser has been operating the Property
since that time.
The Debtor forwarded a proposed joint plan to the Lender predicated
on a sale of the Property. The Lender rejected the proposal, and
filed its own plan and disclosure statement, together with a motion
to approve the disclosure statement and sell the Property. However,
the U.S. Trustee raised a number of objections, including that the
Lender does not have statutory authority to sell Property owned by
the Debtor, as well as alleging various procedural deficiencies.
Class 3 consists of the Allowed General Unsecured Claims. Known
Class 3 Claims include Millenium Elevator $10,380, New York State
$734, Abilene Inc. $5112, and Barton Schwartz $21,000, for a total
of $37,226.
Payment of available cash up to Allowed Amount of Class 3 Claims,
after payment of Administrative Claims, Priority Claims, U.S.
Trustee Fees, post-confirmation Plan Administrator fees, Class 1
and 2 Claims. In the event insufficient cash is available for Class
3 Claims after payment of senior claims as provided for in the
preceding sentence, then each Holder of a General Unsecured Claim
shall be paid its pro-rata share of a $5,000 distribution fund.
To the extent necessary, such fund will be funded by the Class 2
Claimant, as set forth in the Class 2 treatment section of the
Plan. The Class 2 Claimant shall also subordinate payment of its
Class 3 claim to payment in full of all other Class 3 Claims. The
Class 2 Claimant shall retain its right to vote as a Class 3
Claimant. The Debtor estimates at least a 13% recovery to creditors
entitled to distribution from the $5,000 based upon currently
existing legitimate scheduled and filed Claims. Class 3 is impaired
and entitled to vote on the Plan.
Class 4 consists of the membership interests in the Debtor. No
payments, if any, shall be made on account of equity interests in
the Debtor unless and until after payment of Administrative Expense
Claims, U.S. Trustee Fees, post confirmation Plan Administrator
fees, Priority Claims, Class 1, 2, and 3 Claims. have been paid in
full with interest and the Debtor's Chapter 11 case has been fully
administered and closed. Class 4 equity interests are impaired
under the Plan, as insiders their votes are not counted for
purposes of confirmation of the Plan.
The Plan shall be implemented and funded through the sale of the
Property in accordance with the Auction sale process conducted
pursuant to the terms of the Approved Bid Procedures. All decisions
relating to the sale, including the qualification of bidders and
the determination of the highest and best offer at the Auction
shall be made by the Debtor subject to the Lender's consent.
A full-text copy of the Amended Disclosure Statement dated February
3, 2025 is available at https://urlcurt.com/u?l=g3Aye9 from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Goldberg Weprin Finkel Goldstein LLP
J. Ted Donovan, Esq.
125 Park Avenue, 12th Floor
New York, New York 10017
(212) 221-5700
About Panzer Building Corp.
Panzer Building Corp. owns a mixed-used apartment building located
at 651 West 169th Street, New York, NY. The Property is located in
the immediate vicinity of Columbia Presbyterian Hospital and is
improved by a five-story elevator building with 20 residential
apartments and two commercial stores, including a Subway fast food
restaurant and Premier Deli.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 23-11924) on Dec. 4,
2023, with $8,064,000 in assets and $6,660,619 in liabilities.
Nancy J. Haber, authorized representative, signed the petition.
Judge John P. Mastando III presides over the case.
Kevin Nash, Esq., at GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP, is the
Debtor's legal counsel.
PASKEY INC: To Sell Heavy Equipment at Auction
----------------------------------------------
Paskey Incorporated seeks permission from the U.S. Bankruptcy Court
for the Southern District of Texas, Houston, to sell heavy
equipment and miscellaneous tools, free and clear of all liens,
interests, and encumbrances.
The Debtor wants to auction 18 pieces of heavy equipment and
miscellaneous tools.
The Debtor is a Texas corporation formed in 2007 and operates as a
general contractor, providing excavation and site preparation
services for real estate development and various municipal service
providers.
The Debtor's last remaining construction agreement was for River
Ranch One Investments, Ltd., and by agreement of the Debtor and
River Ranch, that the project and contract is concluded.
The Debtor requests approval to auction its Equipment in order to
start winding down its operations, to satisfy any debt obligations
secured by each piece of Equipment, to raise capital, as well as to
divest assets in anticipation of the resolution of the proceeding.
There are no lienholders of the Equipment and the proceeds from the
auction are expected to yield the highest and best offers for the
Equipment and raise cash to pay creditors in accordance with a
Plan.
Any proceeds remain after the payoff amount on each piece of
equipment is satisfied, the remaining proceeds will be used to pay
Debtor’s other financial obligations in accordance with a plan of
reorganization to be filed on or before February 28, 2025.
The Debtor's estimates of the Equipment to be auctioned was
determined by Ritchie Bros., who has guaranteed a minimum payment
to Debtor of $205,000. Sales proceeds between $205,000 and $242,500
will be retained by the Auctioneer as its base commission and any
amounts generated over $242,500 will be split between the Debtor
and the Auctioneer, as follows: 75% to Debtor and 25% to the
Auctioneer pursuant to the contract between Debtor and the
Auctioneer.
About Paskey Incorporated
Paskey Incorporated is a general contractor in La Porte, Texas.
Paskey Incorporated sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Case No. 24-90433) on July 28,
2024. In the petition filed by Curtis W. Paskey, as president, the
Debtor reports estimated assets and liabilities between $1 million
and $10 million each.
The Honorable Bankruptcy Judge Alfredo R. Perez oversees the case.
The Debtor is represented by Bennett G. Fisher, Esq. at LEWIS
BRISBOIS BISGAARD & SMITH.
PHVC4 HOMES: To Sell 23-Single Family Homes for $4.1MM
------------------------------------------------------
PHCV4 Homes, LLC seeks permission from the U.S. Bankruptcy Court
for the Northern District of Alabama, to sell real property at a
private sale free and clear of liens, encumbrances and other
interests.
The Debtor proposes to sell its interest in certain real estate
consisting of 23-single family homes in the community known as
Woodland Trails, in the municipality of Bessemer, Jefferson County,
Alabama, with the total purchase price of $4,190,000.
CoreVest American Finance Lender LLC’s lien rights are
specifically and fully attach to all proceeds of the Sale.
All liens, mortgages, or other interests shall attach to the
proceeds of the sale to the extent properly allowed. However, no
proceeds of the sale shall be paid to Debtor or any person or party
related to Debtor, no other creditors or lienholders shall receive
the net proceeds of the Sale after all closing costs, tax pro
rations, and other routine and necessary Sale related disbursements
are paid by the closing attorney. All Net Sales Proceeds shall be
paid directly CoreVest at closing free and clear of all liens,
interests, and encumbrances. If the Sale does not close on or
before April 2, 2025, then it is null and void and the Sale cannot
thereafter be completed without further approval of the Court.
The Debtor and Vantage Corporate Holdings Inc. DBA Wrightwell
Corporate Holdings, Inc. enters into the Contract to purchase the
Property.
The Debtor asserts that the total sales price of the asset
represents the fair market value of the Property. The Purchaser has
already obtained or will obtain financing, and the sales are
contemplated to be closed forthwith after approval from the Court.
The Property consisting of the WIP Assets will be purchased at
closing on or before April 2, 2025.
About PHCV4 Homes, LLC
PHCV4 Homes LLC is part of the residential building construction
industry.
PHCV4 Homes LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ala. Case No. 24-02751) on September
10, 2024. In the petition filed by Misty M. Glass, as manager, the
Debtor reports estimated assets and liabilities between $10 million
and $50 million each.
The Honorable Bankruptcy Judge Tamara O. Mitchell presides over the
case.
The Debtor is represented by Frederick M. Garfield, Esq., at SPAIN
& GILLON, LLC.
PINNACLE FOODS: Unsecureds Will Get $1,248 per Month for 60 Months
------------------------------------------------------------------
Pinnacle Foods of California, LLC submitted an Amended Plan of
Reorganization for Small Business dated February 3, 2025.
This Plan of Reorganization proposes to pay creditors of the Debtor
from business operation. The final Plan payment is expected to be
paid on February 2030(estimated).
The Debtor's proposed 5-year projections itemize the Debtor's
revenue source and the expenses for the next 5 years. The Debtor
intends to fund its plan from the continued operation of its
business. Since the filing of the present bankruptcy case, the
Debtor reorganized its affairs, and downsized its business overhead
expenses and focused on increasing revenue for its Popeyes
restaurants. Debtor's projections are prepared by carefully
analyzing the historical income and expenses, the Debtor's
performance during the present case, and the prospective income and
expenses, with the recent changes made to its business operation.
Class 3(a) consists of General Unsecured Creditors, Excluding the
Leases the Debtor Wishes to Assume which are classified in Class
3(b) and the Popeyes Franchise Fees which are classified in Class
3(c). The total amount of the allowed general unsecured claims is
$2,496,418.82.
Based on the liquidation analysis and the income valuation of the
Debtor's assets, the holders of allowed general unsecured claims
will be receiving an estimated 3% pro-rata distribution through the
plan. The distribution to allowed general unsecured claims will be
made monthly, with the first payment of $1,248.20 due on the
Effective Date, followed by 59 consecutive payments, each in the
amount of $1,248.20 to be paid pro-rata to each holder of allowed
general unsecured claim. This Class is impaired.
Class 3(b) consists of Landlord for the lease agreements that have
pre petition arrears which Debtor intends to assume. The total
amount of the allowed general unsecured claims is $148,522.99. The
Debtor assumes the lease agreements and proposes to cure the
pre-petition arrears over 12 months, with the first payment of
$12,376.90 due on the Effective Date, followed by 11 consecutive
payments thereafter, each in the amount of $12,376.90, until the
pre petition lease arrears are paid in full. This Class is
impaired.
Class 3(c) consists of Popeyes Louisiana Kitchen for pre-petition
royalties, advertising and related fees. The total amount owed to
Popeyes is $226,332.15. The Debtor intends to assume the franchise
agreements and cure the pre-petition arrears over 12 months, with
the first payment of $18,861.01 due on the Effective Date, followed
by 11 consecutive payments thereafter, each in the amount of
$18,861.01, until the pre-petition arrears are paid in full.
The Debtor's proposed 5-year projections itemize the Debtor's
revenue sources and the expenses for the next 5 years. The Debtor
intends to fund its plan from the continued operation of its
business.
A full-text copy of the Amended Plan dated February 3, 2025 is
available at https://urlcurt.com/u?l=ZYRGBR from PacerMonitor.com
at no charge.
Attorney for the Plan Proponent:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Boulevard, 6th Floor,
Beverly Hills, CA 90212
Telephone: (310) 271-6223
Facsimile: (310) 271-9805
Email: rnichael.bergerbankruptcypower.com
About Pinnacle Foods of California
Pinnacle Foods of California LLC operates six Popeyes franchise
restaurants.
The Debtor filed its voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Cal. Case No. 24-11015) on
April 22, 2024, listing $2,077,748 in assets and $4,509,986 in
liabilities. The petition was signed by Imran Damani as president.
Judge Rene Lastreto II presides over the case.
The Debtor tapped Michael Jay Berger, Esq. at Law Offices of
Michael Jay Berger as bankruptcy counsel and Craig R. Tractenberg,
Esq., at Fox Rothschild LLP as special franchise counsel.
PRAIRIE EYE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: Prairie Eye Center, Ltd.
2020 W. Iles Avenue
Springfield, IL 62704
Business Description: The Debtor owns and operates the Prairie Eye
and LASIK Center, an eye care provider in
Springfield, Illinois, offering
comprehensive optometry services, including
eye exams, LASIK procedures, and emergency
care. Led by Dr. Sandra Yeh, the Center is
committed to providing personalized,
professional care with a focus on patient
comfort and education. The Center also
offers vision financing options and works
with insurance providers to ensure access to
quality eye health and vision care.
Chapter 11 Petition Date: February 7, 2025
Court: United States Bankruptcy Court
Central District of Illinois
Case No.: 25-70105
Judge: Hon. Mary P Gorman
Debtor's Counsel: Sumner A. Bourne, Esq.
RAFOOL & BOURNE, P.C.
401 Main Street, Suite 1130
Peoria, IL 61602
Tel: (309) 673-5535
Fax: (309) 673-5537
E-mail: notices@rafoolbourne.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Sandra W. Yeh, M.D. as bankruptcy
representative.
A full-text copy of the petition, which includes a list of the
Debtor's 20 largest unsecured creditors, is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/ICWVIVY/Prairie_Eye_Center_Ltd__ilcbke-25-70105__0001.0.pdf?mcid=tGE4TAMA
PROMEDICA HEALTHCARE: S&P Affirms 'BB' Long-Term Bond Rating
------------------------------------------------------------
S&P Global Ratings revised the outlook to positive from stable and
affirmed its 'BB' long-term rating and underlying rating (SPUR) on
ProMedica Healthcare, Ohio's bonds outstanding.
"The outlook revision reflects our view of ProMedica's continued
operational improvement and increase in unrestricted reserves,"
said S&P Global Ratings credit analyst Anne Cosgrove. "In addition,
management has successfully completed the divestiture of noncore
businesses and enabled the team to focus on the core acute care
business," Ms. Cosgrove added.
PROSPECT MEDICAL: Conn. AG Opposes Hospital Operator's Plunder
--------------------------------------------------------------
Brian Steele of Law360 reports that Prospect Medical Holdings Inc.
must answer for the harm it caused in Connecticut, but the
immediate priority is swiftly transferring its three hospitals to
new ownership, the state's attorney general and governor's offices
told a Dallas bankruptcy judge.
About Prospect Medical Holdings Inc.
Prospect Medical Holdings owns Roger Williams Medical Center, Our
Lady of Fatima Hospital, and several other healthcare facilities.
Prospect Medical Holdings sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Tex. Lead Case No. 25-80002) on
January 11, 2025. In the petition filed by Paul Rundell, as chief
restructuring officer, the Debtor reports estimated assets and
liabilities between $1 billion and $10 billion each.
Honorable Bankruptcy Judge Stacey G. Jernigan handles the case.
The Debtors' General Bankruptcy Counsel is Thomas R. Califano,
Esq., and Rakhee V. Patel, Esq., at Sidley Austin LLP, in Dallas,
Texas, and William E. Curtin, Esq., Patrick Venter, Esq., and Anne
G. Wallice, Esq., at Sidley Austin LLP, in New York.
The Debtors' Financial Advisor is ALVAREZ & MARSAL NORTH AMERICA,
LLC.
The Debtors' Investment Banker is HOULIHAN LIKEY, INC.
The Debtors' Claims, Noticing & Solicitation Agent is OMNI AGENT
SOLUTIONS, INC.
PROSPECT MEDICAL: Seeks to Sell Medical Facilities in Private Sale
------------------------------------------------------------------
Prospect Medical Holdings Inc. and its affiliates seek permission
from the U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, to sell medical facilities, free and clear of
liens, interests, and encumbrances.
The Debtors and their non-Debtor affiliates are significant
providers of coordinated regional healthcare services in
California, Connecticut, Pennsylvania, and Rhode Island. The
Company's business can be broadly divided into two segments:
hospital operations, which consist of, among other things, the
ownership and operation of 16 acute care and behavioral hospitals,
providing a wide range of inpatient and outpatient services
spanning multiple states, and physician-related services, including
certain owned and managed medical groups, independent physician
associations, managed services organizations and risk taking
entities, Prospect Health Plan, Inc., a Knox-Keene licensed entity,
and one licensed acute hospital operating as Foothill Regional
Medical Center.
The Debtors want to sell in a private sale a California licensed
health care service plan; medical groups in California, Texas,
Arizona, and Rhode Island; a management service organization; a
pharmacy; and Alta Newport Hospital (d/b/a Foothill Regional
Medical Center), a fully accredited acute care hospital with 177
licensed beds.
A small portion of the equity interests and assets that are being
sold and transferred to Astrana are owned by certain Debtors, and
the Debtor and certain other Debtors have additional rights,
obligations, and responsibilities under the Purchase Agreement.
Given the extensive marketing process prior to entry into the
Purchase Agreement, after which Astrana emerged as the only viable
purchaser, and in light of the Debtors' current financial condition
and the Transaction’s crossover between Debtor and non-Debtor
assets, the Debtors believe that introducing an auction process at
this stage would be counterproductive and could result in the loss
of Astrana as a committed buyer.
The Debtors seek approval of the Transaction as a private sale in
order to ensure that the Debtors and their non-Debtor affiliates
can maximize the value of the assets contemplated to be sold in the
Transaction and continue to provide critical care to their patients
and the communities they serve.
The Debtors retain Morgan Stanley as their investment banker to,
among other things, run a competitive auction process for the sale
of the business operated by PhysicianCo, PHS RI, and PPG RI.
The Debtors and Astrana Health Inc. enter into an asset and
purchase agreement of the property for an aggregate purchase price
of $745 million.
The Debtors submit that service of the Potential Assumption and
Assignment Notice on the applicable counterparties is proper and
sufficient to provide notice to the counterparties of the
Assumption and Assignment Procedures and the proposed Cure Amounts
associated with their contract(s).
The Asets are encumbered by liens securing the Prepetition
HospitalCo MPT Master Leases, the Prepetition HospitalCo MPT
Mortgage Loan, and the Prepetition HospitalCo Term Loan Facility.
About Prospect Medical Holdings Inc.
Prospect Medical Holdings owns Roger Williams Medical Center, Our
Lady of Fatima Hospital, and several other healthcare facilities.
Prospect Medical Holdings sought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Tex. Lead Case No. 25-80002) on
January 11, 2025. In the petition filed by Paul Rundell, as chief
restructuring officer, the Debtor reports estimated assets and
liabilities between $1 billion and $10 billion each.
Honorable Bankruptcy Judge Stacey G. Jernigan handles the case.
The Debtors' General Bankruptcy Counsel is Thomas R. Califano,
Esq., and Rakhee V. Patel, Esq., at Sidley Austin LLP, in Dallas,
Texas, and William E. Curtin, Esq., Patrick Venter, Esq., and Anne
G. Wallice, Esq., at Sidley Austin LLP, in New York.
The Debtors' Financial Advisor is ALVAREZ & MARSAL NORTH AMERICA,
LLC.
The Debtors' Investment Banker is HOULIHAN LIKEY, INC.
The Debtors' Claims, Noticing & Solicitation Agent is OMNI AGENT
SOLUTIONS, INC.
PROVISION BREAD: Amends Unsecured Claims Pay Details
----------------------------------------------------
Provision Bread & Bakery, LLC, submitted an Amended Subchapter V
Plan of Reorganization dated January 31, 2025.
The bankruptcy filing was prompted due to its cash flow being
unable to meet its current debt obligations, including an expensive
merchant advance loan. Much of the Debtor's problems originated
from inflation from the Covid pandemic. A restructuring of the
Debtor's debt will allow it to operate profitably.
The Debtor retained Wadsworth Garber Warner Conrardy, P.C. ("WGWC")
as its bankruptcy counsel. WGWC has not yet filed a fee application
in this case. The Debtor provided WGWC with a retainer in the
amount of $19,280 for post-petition services. The Debtor estimates
that there will be an Administrative Claim for unpaid legal fees of
at least $15,000 on the Effective Date of the Plan. The legal fees
could increase or decrease depending on the level of litigation
over these issues and creditor claims.
The fees of the Sub-Chapter V Trustee are estimated to not exceed
$3,000. In August of 2024, the Sub-Chapter V Trustee filed a Motion
for payment of a retainer of $2,500, which request was granted.
However, there was no authority to use cash collateral for the
payment of the retainer. In October of 2024, the Sub Chapter V
Trustee filed a Motion to use cash collateral to pay the retainer,
which relief was granted in November of 2024. Given the close
proximity to the confirmation hearing, it was decided the
Sub-Chapter V Trustee's fees would be dealt with through the Plan.
The Debtor retained M3 & Associates as its accountants. M3 has not
filed a fee application in this case. The Debtor estimates that M3
will hold an Administrative Claim on the Effective Date of the Plan
that will not exceed $5,000.
Class 3 consists of general unsecured creditors of the Debtor who
hold Allowed Claims. Holders of Class 3 Allowed Claims shall share
on a Pro Rata basis monies deposited into the Unsecured Creditor
Account as set forth herein. As set forth in Article III, paragraph
3.2 of this Plan, upon the first full month following the Effective
Date of the Plan and every month until Administrative Claims are
paid in full and then for the remainder of the Term of the Plan the
Debtor will every month in accordance with the terms of this Plan
deposit for the five year Term of the Plan: (a) during the first
year of the Plan $522.55; (b) during the second year of the Plan
$1,465.49; (c) during the third year term of the Plan $3,237.86;
(d) during the fourth year of the Plan $3,851.12 and (e) during the
fifth year of the Plan $4,041.05.
At the end of each calendar quarter, the balance of the Unsecured
Creditor Account will be distributed to the holders of Allowed
Administrative Claims on a Pro Rata basis until such time as all
holders of Allowed Administrative Claims have been paid in full,
and then will be distributed to Tax Claims and Class 1 until paid
in full and then to Class 3 general unsecured creditors that hold
Allowed Claims on a Pro Rata basis.
All funds recovered by the Debtor on account of Avoidance Actions
shall be distributed to Allowed Administrative Claims until paid in
full and then to Class 6, net of attorneys' fees and costs. Whether
or not the Debtor pursues any Avoidance Actions shall be up to the
Debtor and the decision to pursue such claims shall be
discretionary with the Debtor.
Class 4 includes the Interests in the Debtor, which Interests are
unimpaired by the Plan. Upon confirmation of the Plan, all Class 4
Interest holders will retain their ownership Interests in the
Debtor.
The Debtor shall be empowered to take such action as may be
necessary to perform its obligations under this Plan.
The Debtor believes that the Plan, as proposed, is feasible. The
funding for the Plan will come from the Debtor's continued
operations. As detailed in the Projections, the Debtor will have
sufficient cash on hand and profits during the term of the Plan to
satisfy its Plan obligations.
A full-text copy of the Amended Subchapter V Plan dated January 31,
2025 is available at https://urlcurt.com/u?l=9Gyyj8 from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Aaron A. Garber, Esq.
Wadsworth Garber Warner Conrardy, PC
2580 West Main Street, Suite 200
Littleton, CL 80120
Telephone: (303) 296-1999
Facsimile: (303) 296-7600
Email: agarber@wgwc-law.com
About Provision Bread & Bakery
Provision Bread & Bakery, LLC, started as an idea as a part of a
coffee shop in 2020.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Colo. Case No. 24-14823) on Aug. 19,
2024, with as much as $1 million in both assets and liabilities.
Judge Michael E. Romero oversees the case.
Aaron A. Garber, Esq., at Wadsworth Garber Warner Conrardy, PC,
serves as the Debtor's legal counsel.
R & R TRAILERS: Files Subchapter V Bankruptcy in Michigan
---------------------------------------------------------
On February 7, 2025, R & R Trailers Inc. filed Chapter 11
protection in the U.S. Bankruptcy Court for the Western District
of Michigan.
According to court filing, the Debtor reports $1,351,582 in
debt owed to 1 and 49 creditors. The petition states funds will be
available to unsecured creditors.
About R & R Trailers Inc.
R & R Trailers Inc. specializes in manufacturing American-made
aluminum trailers for a variety of uses, including hauling cars,
cargo, and recreational vehicles. Their trailers offer exceptional
performance, reliability, and versatility, providing safe and
efficient transportation for both work and leisure needs.
R & R Trailers Inc. sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Mich. Case No. 25-00318) on February
7, 2025. In its petition, the Debtor reports total assets of
$276,910 and total liabilities of $1,351,582.
Honorable Bankruptcy Judge Scott W. Dales handles the case.
The Debtor is represented by:
Steven M. Bylenga, Esq.
CBH ATTORNEYS & COUNSELORS, PLLC
Main Office
25 Division Avenue S., Suite 500
Grand Rapids, MI 49503
Tel: 616-608-3061
Fax: 616-719-3782
E-mail: nikki@chasebylenga.com
REED'S INC: Unveils Leadership Changes, Appoints CFO & VP of Ops.
-----------------------------------------------------------------
Reed's, Inc. announced key leadership changes, effective Feb. 10,
2025, to strengthen its executive team. Douglas McCurdy has been
appointed chief financial officer, succeeding Joann Tinnelly, who
will transition to chief accounting officer. Salvatore Vassallo
has also been appointed as vice president of operations.
Mr. McCurdy has decades of finance, operational, and leadership
experience across several industries, including investment banking,
technology, and the US Navy. He brings extensive operating
experience having served as chief financial officer and chief
operating officer for multiple early-stage growth companies,
including REZI, Torrential, and BBE. Mr. McCurdy also held
corporate finance and strategic advisory positions at Banc of
America Securities. He started his career as a Lieutenant in the
US Navy. Mr. McCurdy holds a Master of Business Administration in
Accounting and Finance from the University of Chicago Booth School
of Business and a Bachelor of Science in Mechanical Engineering
from Worcester Polytechnic Institute.
Mr. Vassallo, a seasoned consumer packaged goods and supply chain
executive, joins Reed's with extensive experience in inventory
management, strategic sourcing and supply chain optimization. Most
recently, he served as vice president of Supply Chain at Boylan
Bottling Co., where he streamlined distribution networks, drove
cost-reduction and process improvement initiatives, and led
innovation projects. Mr. Vassallo's experience in supply chain
management for CPG companies includes roles at Ferrero, Snapple
Beverages and Henkel. He holds an MBA from the University of
Connecticut, a Bachelor of Science in Economics from Universita'
Bocconi and a MicroMasters Certificate in Supply Chain Management
from MIT.
"We are pleased to welcome Doug and Sal to the Reed's executive
team," said Norman E. Snyder, CEO of Reed's. "Their combined
expertise in finance, supply chain and operations will contribute
to our strategic initiatives and further position Reed's for
long-term success. Joann's transition to CAO provides great
continuity for our finance team and I want to thank her for serving
as CFO over the past 16 months. These leadership changes, together
with our strengthened balance sheet, put us in a strong position to
execute our growth and profitability objectives in 2025."
Meanwhile, on Jan. 31, 2025, Reed's had entered into an executive
employment agreement with Mr. McCurdy, effective Feb. 10, 2025.
The Agreement is for a term of one year and provides for severance
through the date of the initial one-year term, in the event the
company terminates Mr. McCurdy's employment without cause, which
includes but is not limited to customary causes such as failure to
perform, breach, and acts of moral turpitude. Mr. McCurdy will
receive a base salary of $323,000 per year and will be eligible to
receive a discretionary annual performance based bonus with a
target of 30% of his base salary. He is entitled to participate in
all employee benefit plans, practices, and programs maintained by
Reed's provided to similarly situated executives of the company,
including equity compensation plans. He will receive four weeks
paid vacation per year. The Agreement contains customary
indemnification and clawback provisions. In connection with the
Agreement, Mr. McCurdy and the Company entered into a
confidentiality and proprietary information agreement, which
includes standard restrictive covenants.
About Reed's Inc.
Headquartered in Norwalk, CT, Reed's, Inc. -- www.reedsinc.com --
owns a portfolio of handcrafted, natural beverages that is sold in
over 45,000 outlets nationwide. These outlets include the natural
and specialty food channel, grocery stores, mass merchants, drug
stores, convenience stores, club stores, liquor stores, and
on-premises locations including bars and restaurants. Reed's two
core brands are: (i) Reed's, which includes Reed's Craft Ginger
Beer, Reed's Real Ginger Ale, Reed's Classic Mules, and Reed's Hard
Ginger Ale, and (ii) Virgil's Handcrafted sodas. Reed's Craft
Ginger Beers are unique due to the proprietary process of using
fresh ginger root combined with a Jamaican inspired recipe of
natural spices, honey and fruit juices. Reed's uses this same
handcrafted approach in its Reed's Real Ginger Ale and Virgil's
line of great tasting, bold flavored craft sodas, including its
award-winning Virgil's Root Beer.
For the nine months ended Sept. 30, 2024, the Company recorded a
net loss of $9,035,000 and utilized $2,254,000 of cash in
operations and at Sept. 30, 2024, had a working capital deficiency
of $22,923,000 and a stockholders' deficit of $21,953,000. As of
Sept. 30, 2024, the Company borrowed $5,471,000 on its line of
credit and owed $22,210,000 on its Notes. According to the
Company, these factors raise substantial doubt about its ability to
continue as a going concern within one year of the date that the
financial statements are issued.
REEVA DINING: Amends Plan to Include SBA Secured Claim Pay
----------------------------------------------------------
Reeva Dining Club, Inc., submitted an Amended Plan of
Reorganization for Small Business dated January 31, 2025.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $15,738.65.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 2.5 cents on the dollar. This Plan also provides
for the payment of administrative and priority claims.
Class 3 consists of the Secured Claim of Small Business
Administration. The claim was proposed as fully secured, but
pursuant to the consent order entered herein on November 21, 2024,
creditor has a secured claim of $25,000.00 which is the value of
debtor's inventory. The claim shall be paid in full over the five
years at 0% interest with 60 monthly payments of $416.67. The
remaining portion of the claim in the amount of $250,402.84 is
allowed as a general unsecured claim pursuant to the same order and
shall be paid pursuant to Class 4.
Class 4 consists of Non-priority unsecured creditors. This class
includes claim No. 2 originally filed by Pawnee Leasing Corporation
as a fully secured claim. Pursuant to the Order Sustaining
Objection entered herein on June 20, 2024 the claim was allowed as
a general unsecured claim in the amount of $26,896.63. This class
additionally includes unsecured claim No. 5 filed by The Arkansas
Department of Finance and Administration in the amount of
$7,443.85.
Class 4 consists of all allowed general unsecured non-priority
claims, in the approximate amount of $629,545.93 and includes any
amount of secured claims that exceed the value of the collateral
securing the claim. Debtor estimates that there will be a dividend
pool accumulated over the next five years of the Plan in the amount
of $15,738.65. Therefore, unsecured creditors will receive
approximately 2.5% distribution on their claims over the five-year
period of the plan. Debtor will disburse payment pro rata to
unsecured creditors at the end of every plan year for the five
years following confirmation of the plan. A plan year will be
twelve months from the first payment made under the plan and
subsequently twelve months from each payment thereafter for five
years.
Collection against any co-debtor or personal guarantor shall be
prohibited after confirmation of the Plan provided that debtor is
not in default with the terms of the Plan. Nothing herein shall
constitute an admission as to the nature, validity, or amount of
such claim. Debtor reserves the right to object to any and all
claims.
Upon confirmation, Debtor shall be charged with administration of
the case. Chintan Patel will continue to perform his current
position as President of Reeva Dining, LLC, and payments for the
plan will be made from cash flow from this business. Debtor may
maintain bank accounts under the confirmed Plan in the ordinary
course of business. Debtor may also pay ordinary and necessary
expenses of the administration of the Plan in due course.
A full-text copy of the Amended Plan dated January 31, 2025 is
available at https://urlcurt.com/u?l=cCtr1c from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Marc Honey, Esq.
HONEY LAW FIRM, PA
P.O. Box 1254
Hot Springs, AR 71902
Telephone: (501) 321-1007
Facsimile: (501) 321-1255
Email: mhoney@honeylawfirm.com
About Reeva Dining Club
Reeva Dining Club, Inc. operates in the traveler accommodation
industry and is based in Batesville, Ark.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. E.D. Ark. Case No. 24-10386) on Feb. 9,
2024, with up to $50,000 in assets and $1 million to $10 million in
liabilities. Chintan Patel, president, signed the petition.
Judge Phyllis M. Jones oversees the case.
Marc Honey, Esq., at Honey Law Firm, P.A., is the Debtor's
bankruptcy counsel.
RIC (LAVERNIA): $950K New Value Contribution to Fund Plan
---------------------------------------------------------
RIC (Lavernia) LLC submitted a Second Amended Disclosure Statement
in support of Chapter 11 Plan of Reorganization dated February 3,
2025.
The Debtor is a special purpose entity formed to own the Property,
which was acquired at a non-judicial foreclosure sale conducted on
February 6, 2024. The Debtor has an appraisal reflecting the
Property valued at $7,390,000.00 as of July 22, 2024.
Based upon the liquidation analysis, and subject to the outcome of
the Adversary Proceeding challenging the validity and
enforceability of the lien asserted by Milestone, creditors in
Classes 2, 3, and 4 will receive less than full value on account of
their Claims in a Chapter 7 liquidation, and holders of Equity
Interests would receive no distributions.
Under the Plan, however, Class 2 (Wilson County) will be paid the
full amount of its Allowed Claim over time, retaining its lien
against the Property until such payments are made full; Class 3
(Milestone) will retain any valid, enforceable lien as an
encumbrance against the Property; Class 4 (FNA) will be paid
between 75% and 100% of its Allowed Claim over time (depending on
its election), retaining its lien against the Property until such
payments are made in full; and Equity Interests will retain their
interests in exchange for the New Value Contribution estimated to
be approximately $950,000, funded in tandem with Plan payment
obligations.
Under the Plan, the Debtor will continue to manage and operate the
Property and will acquire funding through the New Value
Contribution from the holder of Equity Interests sufficient to pay
all Plan payments.
Class 2 consists of the Secured Claim of Wilson County. Class 2
shall retain its liens and shall receive payment in full of the
amount of its Allowed Claim including post-petition interest at the
statutory rate of 1% per month, in four quarterly installments with
the first payment due at the end of the first quarter after the
Effective Date. Upon payment in full of all Class 2 Plan payments,
the lien will be deemed extinguished and released.
Class 3 consists of the secured claim of Milestone. Class 3 shall
retain any valid lien as determined in the Adversary Proceeding.
The Debtor/Reorganized Debtor does not assume any liability for
payment of Milestone's alleged underlying debt owed by Borrower. In
the event Milestone establishes the validity and enforceability of
its lien in the Adversary Proceeding, Milestone will be entitled to
enforce its rights thereunder to the extent set forth in the
controlling lien documents and applicable non-bankruptcy law. In
the event the Debtor successfully defeats Milestone's claim of a
valid, enforceable lien, the lien will be removed and Milestone
will no longer hold an interest in the Property.
Class 4 consists of any other claim secured by the Property. Based
on the Debtor's initial analysis, of the $1,465,902.47 set forth in
the Proof of Claim, only $272,556.37 pertains to the Property; the
remaining portion of the FNA claim relates to tax liens on parcels
not owned by the Debtor. The Debtor's investigation and analysis of
the FNA Proof of Claim remains ongoing. In the event Class 4 votes
in favor of the Plan, FNA shall receive payment totaling
seventy-five percent of the Allowed amount of its Claim, without
interest, paid in equal quarterly installments over two years.
In the event Class 4 votes to reject the Plan and the Plan is
confirmed over the rejection vote, FNA shall receive payment
totaling one hundred percent of the Allowed amount of its Claim,
without interest, in quarterly installments amortized over twenty
years with the final balloon payment due at the conclusion of ten
years after the first quarterly payment becomes due. Claim payment
will be determined on a parcel-by parcel basis. Upon payment in
full of all Class 4 Plan payments, the liens associated with the
paid parcel(s) will be deemed extinguished and released. In the
discretion of the Debtor/Reorganized Debtor, parcels encumbered by
valid liens held by the holder of Class 4 Allowed Claims may be
abandoned, in which case no payment will be due as to the abandoned
parcel(s).
Class 5 shall consist of all Allowed Claims of Unsecured Creditors.
No general unsecured claims have been asserted against the Debtor,
and the Debtor is not aware of any general unsecured creditors.
Class 5 is Unimpaired.
Class 6 shall consist of the Debtor's Equity Interests. The holder
of the Debtor's Equity Interests will contribute new value (the
"New Value Contribution") estimated in the amount of $950,000. The
New Value Contribution is calculated as the amount of unpaid
Allowed Administrative Claims (estimated at $100,000); the Class 2
Claim (estimated at $310,000); the Class 4 Claim (estimated at
$230,000); and such additional amounts as necessary to fund
payments for future taxes and development of the Property. During
the Plan term (estimated at $310,000). Funding of the New Value
Contribution will occur as required over the duration of the Plan
term to make all Plan payments when due.
The Debtor will fund the Plan through the New Value Contribution.
The Debtor will also proceed with the Adversary Proceeding to
determine the validity of Milestone lien, and pursue any other
Claim objections. At this time, other than the Adversary Proceeding
and other Claim objections, the Debtor does not believe the estate
has any Chapter 5 causes of action or other claims to pursue.
However, to the extent the Debtor/Reorganized Debtor identifies and
pursues any Chapter 5 causes of action or other claims, the
successful pursuit and recovery therefrom will provide additional
funding.
A full-text copy of the Second Amended Disclosure Statement dated
February 3, 2025 is available at https://urlcurt.com/u?l=nyL0tz
from PacerMonitor.com at no charge.
RIC (Lavernia) LLC is represented by:
Kyle S. Hirsch, Esq.
Bryan Cave Leighton Paisner LLP
The Dallas Arts Tower
2200 Ross Avenue, Suite 4200W
Dallas, TX 75201
Tel: (214) 721-8000
Fax: (214) 721-8100
Email: kyle.hirsch@bclplaw.com
About Ric (Lavernia) LLC
RIC (Lavernia) LLC is a Texas limited liability company that owns
real property located in Wilson County, Texas (the "Property").
The Debtor filed its voluntary petition for Chapter 11 protection
(Bankr. W.D. Tex. Case No. 24-51195) on June 27, 2024, listing $1
million to $10 million in assets and $100,000 to $500,000 in
liabilities. Gianfriddo as authorized representative, signed the
petition.
Judge Michael M Parker oversees the case.
BRYAN CAVE LEIGHTON PAISNER LLP serves as the Debtor's legal
counsel.
ROGERS COMMUNICATIONS: Fitch Rates New USD & CAD Sub. Notes 'BB'
----------------------------------------------------------------
Fitch Ratings has assigned a 'BB' rating to Rogers Communications
Inc.'s (Rogers) proposed two-tranche US dollar and Canadian dollar
subordinated notes offering with a combined total of CAD4 billion,
each due in 2055. Fitch has assigned a 50% equity credit to
subordinated notes. Rogers intends to use net proceeds to fund a
substantial portion of BCE Inc.'s (Bell) 37.5% stake in Maple Leaf
Sports & Entertainment Ltd. (MLSE). Fitch has also affirmed Rogers'
Long-Term Issuer Default Rating (IDR) at 'BBB-'. The Rating Outlook
is Stable.
The ratings reflect Fitch's expectation that Rogers will meet its
deleveraging targets, supported by EBITDA growth, and its announced
financing transactions, along with a financial policy consistent
with its investment-grade ratings. The ratings also consider the
company's strong business profile, enhanced scale and business
diversification following its Shaw Communications Inc. acquisition,
and strong FCF generation over the rating horizon.
Key Rating Drivers
Sub-Notes Receive Equity Credit: The multi-tranche offering of the
subordinated notes are assigned 50% equity credit under Fitch's
Hybrid criteria after considering the subordination, no
cross-default provisions, coupon deferral for at least five years,
no coupon step-ups, and an effective maturity date of 2055. In the
event Rogers defers a coupon payment, the subordinated notes would
no longer qualify for equity credit. This treatment is consistent
with Rogers' existing subordinated notes due in 2081 and 2082,
which also receive 50% equity credit under Fitch's Hybrid
criteria.
Deleveraging on Track: Fitch estimates Rogers' EBITDA leverage as
of Dec. 31, 2024 at approximately 4.3x, with leverage expected to
decline to the upper 3x area by the end of 2025. Leverage declined
significantly from around 5.3x at Shaw transaction close aided by
accelerated synergy realizations and debt reduction. Fitch expects
Rogers will prioritize FCF, supported by EBITDA growth, other
deleveraging opportunities (as discussed in the next key rating
driver) and a capital structure that supports deleveraging. Fitch
expects Rogers will refrain from share repurchases while leverage
is elevated.
Potential Capital Allocation Levers: Fitch believes Rogers will
continue to demonstrate a consistent financial policy that
prioritizes a strong balance sheet. This could include taking
additional actions to achieve deleveraging targets particularly if
EBITDA or FCF generation are below expectations to maintain its
investment grade ratings. Rogers has talked about plans to
potentially monetize about CAD1 billion in asset sales, primarily
from real estate but also sale of data centers. Fitch has not
included asset sale assumptions in its forecast, so any such sale
will be incremental to cash flows/deleveraging.
In 2023, Rogers sold its investment interests in Cogeco
Communications Inc. and parent Cogeco Inc. for CAD829 million and
used proceeds for debt reduction. Rogers also amended its dividend
reinvestment plan (DRIP) to enable a small discount on the dividend
reinvestment share price and allow for treasury shares issuance for
the settlement of the DRIP dividends. The company issued hybrid
debt in 2021 and 2022 to manage leverage. Fitch views these recent
actions as supportive to Rogers' credit profile and in line with
its financial policy commitment to manage leverage to achieve
deleveraging targets.
Enhanced Scale and Competitive Position: Rogers' April 2023
acquisition of Shaw materially enhanced the company's competitive
position by increasing scale, improving business mix
diversification and enabling significant synergy realization.
Rogers exited 1Q24 with the full $1 billion of cost synergy target
run rate within one year of acquisition. Fitch expects EBITDA
margins supported by incremental savings from initiatives such as
vendor negotiations, IT projects, media content costs and
backhaul-related savings as well as replacing mmWave spectrum
backhaul capacity with fiber in the West where feasible.
Intermittent Spectrum Spending: Fitch believes Rogers' spending on
spectrum supports its longer-term credit profile. Spectrum is a key
resource that is largely available only through auctions. Spectrum
investments are uneven, and operators need to acquire spectrum when
it becomes available every few years via the auction process.
Rogers is also likely to participate in upcoming auctions for
millimeter wave spectrum. During 4Q23, Rogers won 860 licenses
totaling 40.5 MHz of 3800 MHz spectrum for CAD475 million. It spent
CAD3.3 billion in the 3500 MHz auction to acquire 325 licenses
during 2021.
Diversified Asset Mix: Rogers' good mix of telecom and cable assets
as one of the largest multichannel video programming distributors
in Canada strongly positions the company and allows for significant
revenue diversification. The company will utilize bundled service
offerings supported by its national Canadian wireless operations
and strong wireline market positions in the West. The company also
launched a national fixed wireless access offering in 2023 focused
on rural areas and the remaining one-third of the country where it
doesn't have a wireline footprint.
Derivation Summary
Rogers' (BBB-/Stable) ratings reflect the stability of its
diversified operating profile underpinned by its national wireless
and extensive cable assets that anchor a strong competitive
position, as evidenced by its high margins, wireless market share
gains and growing cash flows that support a solid FCF profile.
These factors are balanced against the higher leverage due to the
Shaw acquisition in a debt-funded transaction and increased
spectrum investments.
Rogers competes with TELUS and Bell in Canada, both of which have
similar business risk profiles. They each have strong competitive
positions with business profiles that benefit from diversified
operations, including leading positions as national wireless
operators in the Canadian market and strong regional market
positions offering telecom-oriented services to consumers and
businesses. In addition, TELUS has diversified into healthcare,
home security, business process outsourcing and agriculture.
Rogers has telecom and video-oriented offerings similar to its
North American peers — AT&T Inc. (BBB+/Stable), Verizon
Communications Inc. (A-/Stable) and T-Mobile US, Inc. (BBB+/Stable)
— but does not compete directly with them. These carriers have
much larger scale, more geographical diversification and lower debt
leverage.
Key Assumptions
- Organic revenue growth in the low single digits;
- EBITDA margins near the mid-40s;
- Capital spending around CAD4 billion reflecting fiber builds, 5G
deployment and capacity expansion;
- Spectrum spending place holders for the auction in 2025. The
auction timing and rules are subject to uncertainty and could
affect the bidding level;
- No share buybacks.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- EBITDA leverage sustained above 4x due to higher than anticipated
spectrum purchases, acquisitions, shareholder friendly activities
or lack of execution on additional deleveraging opportunities;
- Intensifying competition, pressuring margins and EBITDA.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- Positive rating actions are not anticipated in the intermediate
term, given the increase in leverage following the close of the
Shaw transaction;
- The company could be upgraded if EBITDA leverage is less than
3.25x, combined with good operating momentum across its business
segments.
Liquidity and Debt Structure
Rogers' liquidity is well-positioned, with expectations for
consistent FCF, balance sheet cash and substantial undrawn capacity
on its credit facilities. Rogers' total revolving credit facility
commitment is CAD4 billion with a maturity date for the CAD3
billion tranche of April 2029 and the CAD1 billion tranche of April
2027. The revolving facility had no outstanding borrowings with
around CAD3.5 billion of net availability at the end of 2024, as
the facility backstops the company's USD1.5 billion CP program that
had CAD455 million outstanding.
The company also has a CAD2.4 billion receivables securitization
program. The program, which matures in June 2027, had $800 million
availability at YE2024. Cash and cash equivalents were CAD898
million at the end of 4Q24. In November 2023, Rogers entered into
three non-revolving credit facilities with an aggregate limit of $2
billion. In December 2023, two of these credit facilities were
terminated and the amount available was reduced from $2 billion to
$500 million. The facility was fully drawn at YE2024.
Issuer Profile
Rogers is a leading telecommunications provider in Canada with
approximately 12 million wireless phone subscribers and 4.3 million
retail internet customers. Rogers also owns the Toronto Blue Jays
and the Rogers Centre and has a 37.5% stake in MLSE.
Summary of Financial Adjustments
- Adjustments for outstanding equipment installment plan
receivables related to financial services operations (assessed
using a debt/equity ratio of 2x) resulted in the level of debt used
in calculating leverage metrics reducing by approximately CAD2
billion;
- Adjustments to total debt to account for the hedged rate for U.S.
dollar-denominated debt;
- Reclassification of changes in non-cash working capital investing
cash flow to working capital.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
ESG Considerations
Rogers Communications, Inc. has an ESG Relevance Score of '4' for
Governance Structure due to Rogers' dual class share structure with
the Rogers Control Trust controlling 98% of the outstanding Class A
voting shares of the company. This results in the Rogers Control
Trust chairman having voting control of Rogers Communications.
Fitch does not anticipate material changes to the company's
corporate governance or ownership structure over the forecast
period.
Starting in 2021, there were corporate governance issues with a
division within the controlling Rogers family and led to a change
in five board of director members and CEO. Fitch notes there was a
private settlement between the family members in January 2024 when
the company announced that Melinda Rogers-Hixon and Martha Rogers
will retire from the Rogers board of directors as part of a private
settlement between members of the Rogers family. However, Fitch
believes there is significant key-person risk and limited board
independence through family ownership/dominant shareholders. This
has a negative impact on the credit profile and is relevant to the
ratings in conjunction with other factors.
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 Prior
----------- ------ -----
Rogers Communications,
Inc. LT IDR BBB- Affirmed BBB-
Subordinated LT BB New Rating
senior unsecured LT BBB- Affirmed BBB-
subordinated LT BB Affirmed BB
SECRETARIAT ADVISORS: S&P Assigns 'B-' ICR, Outlook Stable
----------------------------------------------------------
S&P Global Ratings assigned its 'B-' issuer credit rating to
U.S.-based consulting firm Secretariat Advisors LLC, the borrower
of the debt and issuer of audited financial statements. At the same
time, S&P assigned its 'B-' issue-level rating and '3' recovery
rating to the company's senior secured credit facility. The '3'
recovery rating indicates its expectation for meaningful recovery
(50%-70%; rounded estimate: 60%) recovery in the event of a
default.
The stable outlook reflects S&P's expectation that Secretariat will
continue to increase its revenue and EBITDA bases by adding and
integrating new managing directors into the workstream, improving
S&P Global Ratings-adjusted leverage to about 6x by the end of
2025.
Secretariat is issuing a $55 million revolving credit facility,
$400 million first-lien term loan, and $50 million delayed-draw
term loan to refinance debt and add cash to the balance sheet.
Additionally, Secretariat operates in a highly competitive
environment that typically lacks long-term contracted sources of
revenue. Usually, each engagement is solicited, awarded, and
negotiated separately. Secretariat's competitors--such as FTI
Consulting, Alix Partners, or Deloitte--offer an array of
consulting services and benefit from more financial resources,
significant national or international presence, larger professional
staff, or greater brand recognition. Nevertheless, Secretariat has
a good operating track record and established a solid reputation as
an independent provider of expert analysis, advice, and testimony.
Its brand recognition has improved in recent years as the company
has expanded.
The company has a highly leveraged balance sheet, and pro forma for
the proposed transaction we expect S&P Global Ratings-adjusted
leverage of about 7.8x as of Dec. 31, 2024. That said, S&P expects
adjusted leverage to improve to about 6x in 2025 and 5x in 2026,
supported by its expectation for EBITDA growth over the next 24
months. This is largely driven by the ramp-up of business from
managing directors hired in 2023, 2024, and 2025 as well as
expansion from fully ramped directors, increased arbitration cases,
and rising fee rates. Still, S&P's rating incorporates
Secretariat's private equity sponsor ownership by JLL Partners and
our belief that financial sponsors tend to increase leverage of the
companies they own over time either through debt-financed growth
initiatives or dividends to shareholders, factors that may preclude
sustained deleveraging.
S&P said, "We expect Secretariat to expand through targeted
managing director hires, which could keep S&P Global
Ratings-adjusted leverage elevated and depress its EBITDA margin
and free operating cash flow (FOCF). The company hires individual
experts with substantial signing bonuses, which hurts operating
cash flow, S&P Global Ratings-adjusted EBITDA, and EBITDA margins.
Signing bonus amortization expenses flow through its cost of
revenue. Additionally, newly hired experts take about 18-24 months
to fully ramp up their earnings capabilities, which creates a drag
on working capital as new customer engagements elevate accounts
receivable. Rapid growth in 2023 and 2024 kept adjusted leverage
elevated with FOCF deficits due to the impact of signing bonuses
and the ramp-up of new hires. As Secretariat increases scale, we
believe the financial dip from new managing director hires will
have a more muted bearing on adjusted leverage and profitability.
We expect it will hire 10 managing directors per year. The 2023 and
2024 hires will contribute incremental EBITDA, and FOCF will turn
modestly positive in 2025. Still, hiring patterns are hard to
predict, and the timing of new hires or a more aggressive hiring
strategy could keep adjusted leverage elevated and limit FOCF. We
believe the company's undrawn $55 million revolver and $50 million
delayed-draw term loan will help support periods of elevated
hiring. Additionally, JLL Partners has used equity to help fund
expansion over the past three years.
"The company's good operational performance and reputation
partially offset these risks. Secretariat's revenue growth has been
healthy over the past three years while it diversified into new
practice lines. We expect S&P Global Ratings-adjusted EBITDA margin
expansion in 2025 and 2026, with margins higher than some of its
larger rated peers. The company has a broad geographic footprint
with offices across North America, Europe, Australia, Singapore,
Dubai, Bogota, Mumbai, and Hong Kong, key areas for the global
dispute resolution sector. Secretariat benefits from an industry
leading retention rate (95% area) and was recognized by the Global
Arbitration Index as the No. 1 provider in global arbitration
services based upon caseload value, reputation, and expertise.
"While we believe there is risk tied to Secretariat's revenue
concentration from its top managing directors, the company has
reduced its concentration in recent years. In 2024, the company's
top five of its 122 managing directors accounted for 20% of
revenue, improved from 30% in 2021. While we believe the loss of
one of these primary contributors would hurt financial metrics,
Secretariat has low attrition rates due to its long-term financial
incentives to ensure the alignment and retention of managing
directors, which includes equity and signing bonuses. In addition,
we expect the concentration of revenue from its top managing
directors will continue to decrease as recent hires increase
earnings.
"Secretariat is well-positioned for continued expansion. We believe
its business model will benefit from the increasing complexity of
the global legal system and market expansion. We believe
Secretariat's portfolio of consulting services focused on dispute
resolution, which are complex matters, to have moderately higher
barriers to entry than in its other consulting services such as
operational advisory services. The company's billable experts are
PhD's, members of the Royal Institution of Chartered Surveyors,
chartered financial analysts, engineers, quantity surveyors, and
accountants with extensive industry knowledge. In addition, its
revenue mix mostly comprises noncyclical and countercyclical
businesses, which will likely provide stable revenue. For example,
Secretariat's revenue was mostly unaffected by the COVID-19-related
economic downturn, supported by a double-digit percentage revenue
increase.
"The stable outlook reflects our expectation that Secretariat will
continue to increase its revenue and EBITDA bases by adding and
integrating new managing directors into its workstream, which will
improve S&P Global Ratings-adjusted leverage to about 6x by the end
of 2025.
"We could lower our rating on Secretariat if we expect its
operating performance to deteriorate such that liquidity materially
weakens, we believe FOCF deficits will persist even if the company
curtails its investments in new MDs, and we believe the capital
structure is unsustainable." Specifically, S&P could lower its
rating if:
-- The company faces high senior professional turnover;
-- It faces reputational issues that lead to a sharp decline in
its revenue or EBITDA margins; or
-- The company pursues an aggressive shareholder-return policy
with debt-funded dividends or acquisitions.
S&P could raise its rating on Secretariat if:
-- It continues to increase its revenue scale while maintaining
healthy EBITDA margins; and
-- S&P expects the company will sustain S&P Global Ratings
adjusted leverage comfortably below 6x, with FOCF to debt in the
mid- to high-single-digit percent area
SILVERGATE CAPITAL: Court OKs Appointment of Wickouski as Examiner
------------------------------------------------------------------
Judge Karen Owens of the U.S. Bankruptcy Court for the District of
Delaware approved the appointment of Stephanie Wickouski as
examiner in the Chapter 11 cases of Silvergate Capital Corporation
and its affiliates.
Ms. Wickouski was appointed by the U.S. Trustee for Region 3 after
a series of consultations with the companies' management, Stilwell
Activist Investments, L.P., Exploration Capital Fund, LP and an ad
hoc group representing preferred shareholders.
In court papers, Ms. Wickouski disclosed that she is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
About Silvergate Capital Corporation
Silvergate Capital Corporation is a Maryland corporation
headquartered in La Jolla, Calif. Until July 1, 2024, it was a bank
holding company subject to supervision by the Board of Governors of
the Federal Reserve.
Silvergate Capital Corporation filed voluntary Chapter 11 petition
(Bankr. D. Del. Lead Case No. 24-12158) on Sept. 17, 2024, listing
$100 million to $500 million in assets and $10 million to $50
million in liabilities. The petitions were signed by Elaine Hetrick
as chief administrative officer.
Judge Karen B. Owens oversees the case.
Paul N. Heath, Esq., at Richards, Layton & Finger, P.A. represents
the Debtor as legal counsel.
SOLDIER OPERATING: Seeks to Sell Oil & Gas Property to Rusk Energy
------------------------------------------------------------------
Soldier Operating LLC, and its affiliate Viceroy Petroleum LP, seek
permission from the U.S. Bankruptcy Court for the Western District
of Louisiana, Lafayette Division, to sell real and personal oil and
gas property, free and clear of liens, interests, and encumbrances.
The proposed sale process may include, to a far lesser extent,
related properties of certain limited partners or other affiliates
and/or insiders of the Debtor, namely Triad Production LP, Bethany
M. Bryan, and Abbie L. Ferguson known as Non-Debtor Mineral
Holders.
Viceroy owns and holds certain real and personal property interests
in and associated with oil and gas properties in the Texas counties
of Milam, Burleson, Robertson, Karnes, and Zavala.
The Debtor receives an offer from Rusk Energy Corporation for the
purchase of the interests in Milam, Burleson, and Robertson
Counties.
The Assets include a few leases in which the Non-Debtor Mineral
Holders may directly own working interests. The Non-Debtor Mineral
Holders have indicated they are willing to have their interests
included in the transaction to assure a transfer of 100% of Viceroy
related interests in the Assets.
The Assets include oil held in tanks, which is inventory of the
Debtor. The Inventory is subject to an asserted lien by MBark
Global, LLC against the Debtor. The Non-Debtor Mineral Holders do
not hold any independent interests in the Inventory.
The Debtor seeks approval of the bidding procedures, authorizing
the Debtor to designate Rusk as the stalking horse bidder and offer
the Stalking Horse Bidder certain bid. The schedule of the hearing
will be on February 25, 2025.
MBark's alleged Lien will attach to the proceeds of the sale of the
Inventory, which Inventory is estimated to be valued at $70,000.
All Qualified Bids will allocate the amount of the Proposed
Purchase Price that is attributable to the Inventory, and the
Successful Bidder’s proposed allocation to the Inventory will be
included in the proposed Sale Order.
The Debtor asserts that it is in the best interest of the Estate to
sell the Assets in a public auction conducted by Debtor’s counsel
retained in this bankruptcy proceeding.
The Debtor reached a conclusion after considering a proposal by The
Oil & Gas Clearinghouse, LLC, to sell the properties for a
marketing fee and sale fees, with the option to divide, at its
discretion, the properties into "lots" to sell, and with the sale
fees to be paid from each lot sold. Having compared the expected
recovery under the Clearinghouse arrangement with the expected
recovery from Rusk’s offer to purchase the Assets, and having
been earlier advised of interest from a second potential buyer with
little or no marketing effort, the Debtor believes a competitive
auction process free of marketing fees and sale fees will yield the
greatest return to the estate.
As the result of negotiations with Debtor, Rusk submitted the
Letter of Intent in which it offered to purchase the Assets for
$345,000, comprised of $70,000 for the Inventory and $275,000 for
the remaining Assets.
The Debtor determines that designating Rusk as Stalking Horse
Bidder will enhance the Debtor’s ability to maximize the value of
the Assets and is in the best interests of its estate.
The Debtor also seeks approval of certain bid protections, as
follows;
"a. a minimum initial overbid increment of $10,000, such that the
minimum opening overbid will be $355,000; and
b. minimum bid increments thereafter of $5,000.
The effective date of the Sale will be February 1, 2025, at 7:00
A.M. (prevailing time in the location of the Assets), with the
closing expected to occur on or before February 28,
2025.
The key dates and deadlines are:
-- File on the docket and serve on the Sale Notice Parties the Sale
Notice, Bid Procedures, and Auction Order - Within one (1) business
day after the signing of the Auction Order.
-- Supplement the Motion with (i) form PSA signed by Stalking Horse
Bidder and (ii) proposed Sale Order on February 20, 2025.
-- Bid Deadline February 21, 2025, at 4:00 p.m. CT
-- Qualified Bid and Baseline Bid Designation Date February 24,
2025, at 2:30 p.m. CT
-- Sale Hearing and Auction February 25, 2025, at 2:30 p.m. CT
-- Notice of Auction Results February 26, 2025
-- Closing Deadline February 28, 2025
The Debtor submits that requiring an Initial Overbid amount of
$10,000 followed by minimum Bid Increase increments of $5,000 are
fair and reasonable, and will promote a robust Auction.
The Debtor indicates that the proposed Stalking Horse Bid
Protections are justified and will benefit the Debtor’s estate,
its creditors, and other parties-in-interest.
The Debtor further states that he Debtor submits that the Bid
Procedures will yield the highest or best
consideration, providing a "market check" that will assure fair and
reasonable consideration for the Assets.
About Soldier Operating LLC
Soldier Operating, LLC and Viceroy Petroleum, LP filed voluntary
petitions for relief under Chapter 11 of the Bankruptcy Code
(Bankr. W.D. La. Lead Case No. 24-50387) on May 13, 2024. In the
petitions signed by Matthew Ferguson, president, Soldier Operating
disclosed $5,615,631 in assets and $6,089,722 in liabilities.
Judge John W. Kolwe presides over the cases.
Bradley L. Drell, Esq., at Gold, Weems, Bruser, Sues & Rundell,
APLC, is the Debtors' counsel.
The U.S. Trustee appointed an official committee of unsecured
creditors in the Chapter 11 cases. The committee tapped H. Kent
Aguillard, Esq., and Caleb K. Aguillard, Esq., and Stewart Robbins
Brown & Altazan, LLC as co-counsel.
SONOMA PHARMACEUTICALS: Reports Net Loss of $928K for Q3 2024
-------------------------------------------------------------
Sonoma Pharmaceuticals, Inc., filed its Quarterly Report on Form
10-Q with the Securities and Exchange Commission, revealing a net
loss of $928,000 on revenues of $3.56 million for the three months
ending Dec. 31, 2024. In comparison, the Company reported a net
loss of $866,000 on revenues of $3.14 million for the same period
in 2023.
For the nine months ending Dec. 31, 2024, the Company reported a
net loss of $2.68 million on revenues of $10.53 million, compared
to a net loss of $3.77 million on revenues of $9.30 million for the
same period in 2023.
As of Dec. 31, 2024, the Company reported total assets of $13.67
million, total liabilities of $8.80 million, and total
stockholders' equity of $4.87 million.
At Dec. 31, 2024 and March 31, 2024, the Company's accumulated
deficit amounted to $197,030,000 and $194,349,000, respectively.
The Company had working capital of $8,677,000 and $8,829,000 as of
Dec. 31, 2024 and March 31, 2024, respectively. The cash balance
at Dec. 31, 2024 and March 31, 2024 was $5,236,000 and $3,128,000,
respectively. During the nine months ended Dec. 31, 2024 net cash
provided by operating activities amounted to $7,000. During the
nine months ended Dec. 31, 2023 net cash used in operating
activities amounted to $2,550,000.
Sonoma Pharmaceuticals noted, "Management believes that the Company
has access to additional capital resources through possible public
or private equity offerings, debt financings, corporate
collaborations or other means; however, the Company cannot provide
any assurance that new financings will be available on commercially
acceptable terms, if needed. If the economic climate in the U.S.
deteriorates, the Company's ability to raise additional capital
could be negatively impacted. If the Company is unable to secure
additional capital, it may be required to take additional measures
to reduce costs in order to conserve its cash in amounts sufficient
to sustain operations and meet its obligations. These measures
could cause significant delays in the Company's continued efforts
to commercialize its products, which is critical to the realization
of its business plan and the future operations of the Company.
This uncertainty along with the Company's history of losses
indicates that there is substantial doubt about the Company's
ability to continue as a going concern within one year after the
date that the financial statements are issued."
The full text of the Form 10-Q is available at no cost at:
https://www.sec.gov/Archives/edgar/data/1367083/000168316825000736/sonoma_i10q-123124.htm
About Sonoma Pharmaceuticals
Headquartered in Boulder, Colorado, Sonoma Pharmaceuticals, Inc.
(NASDAQ: SNOA) -- http://www.sonomapharma.com-- is a global
healthcare company developing and producing stabilized hypochlorous
acid, or HOCl, products for a wide range of applications, including
wound care, eye care, oral care, dermatological conditions,
podiatry, animal health care, and non-toxic disinfectants. The
Company's products reduce infections, itch, pain, scarring, and
harmful inflammatory responses in a safe and effective manner.
In-vitro and clinical studies of HOCl show it to safely manage skin
abrasions, lacerations, minor irritations, cuts, and intact skin.
The Company sells its products either directly or via partners in
55 countries worldwide.
Tampa, Florida-based Frazier & Deeter, LLC, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated June 17, 2024, citing that the Company has incurred
significant losses and negative operating cash flows and needs to
raise additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about its
ability to continue as a going concern.
Sonoma reported a net loss of $4,835,000 and $5,151,000 for the
years ended March 31, 2024 and 2023, respectively. At March 31,
2024 and 2023, the Company's accumulated deficit amounted to
$194,349,000 and $189,514,000, respectively. The Company had
working capital of $8,829,000 and $10,081,000 as of March 31, 2024
and 2023, respectively. During the years ended March 31, 2024 and
2023, net cash used in operating activities amounted to $2,398,000
and $6,152,000, respectively. As of March 31, 2024, the Company
had cash and cash equivalents of $3,128,000.
SOUTH REGENCY: Seeks Chapter 11 Bankruptcy Protection in Kansas
---------------------------------------------------------------
On February 10, 2025, South Regency Shops LLC filed Chapter 11
protection in the U.S. Bankruptcy Court for the District of
Kansas.
According to court filing, the Debtor reports $2,578,359 in
debt owed to 1 and 49 creditors. The petition states funds will be
available to unsecured creditors.
About South Regency Shops LLC
South Regency Shops LLC owns a shopping center situated at 9296
Metcalf Avenue in Overland Park, Kansas, with an estimated current
value of $810,000.
South Regency Shops LLC sought relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Kan. Case No. 25-20140) on February 10,
2025. In its petition, the Debtor reports total assets of $817,347
and total liabilities of $2,578,359.
Honorable Bankruptcy Judge Dale L. Somers handles the case.
The Debtor is represented by:
Colin Gotham, Esq.
EVANS & MULLINIX, P.A.
7225 Renner Road, Suite 200
Shawnee, KS 66217
Tel: (913) 962-8700
Fax: (913) 962-8701
E-mail: cgotham@emlawkc.com
SPI ENERGY: Director Maurice Ngai Resigns, Cites Cash Flow Concerns
-------------------------------------------------------------------
SPI Energy Co., Ltd. disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that Maurice Wai-fung Ngai,
an independent director of the Board of Directors and a member of
the Audit Committee, Nominating and Corporate Governance Committee,
and Compensation Committee, as well as the Chairman of the Audit
Committee, informed the Company of his decision to resign from the
Board of Directors and all committees, effective January, 16, 225.
Mr. Ngai did not advise the Company of any disagreement with the
Company on any matter relating to its operations, policies or
practices. However, Mr. Ngai expressed his concerns about the
Company's ongoing cash flow issues, which he believe has resulted
in the Company not adequately addressing its material weaknesses,
not maintaining adequate D&O insurance, not timely paying its
expenses (including director compensation of approximately
US$398,000 that is owed to him), and the difficulty of the Company
to comply in a timely manner with its reporting obligations under
the Securities Exchange Act of 1934.
About SPI Energy Co.
SPI Energy Co., Ltd. is a global provider of photovoltaic (PV)
solutions for business, residential, government and utility
customers and investors. The Company develops solar PV projects
which are either sold to third party operators or owned and
operated by the Company for selling of electricity to the grid in
multiple countries in Asia, North America and Europe.
New York, New York-based Marcum Asia CPAs LLP, the Company's
auditor since 2018, issued a "going concern" qualification in its
report dated April 14, 2023, citing that the Company has a
significant working capital deficit, has incurred significant
losses and needs to raise additional funds to sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
The Company suffered a net loss of $5.6 million during the nine
months ended September 30, 2023 from continuing operations. As of
September 30, 2023, there was net working capital deficit of $114.7
million and accumulated deficit of $684.7 million. These factors
raise substantial doubt as to its ability to continue as a going
concern, according to the Company's Quarterly Report for the period
ended Sept. 30, 2023.
The Company have yet to file its Annual Report on Form 10-K for the
year ended December 31, 2023 due to the fact that the Company was
unable to finalize its financial results without unreasonable
expense or effort.
SPI ENERGY: Director Resigns Over Cash Flow and Reporting Issues
----------------------------------------------------------------
Maurice Wai-fung Ngai, an independent director and Chairman of the
Audit Committee of SPI Energy Co., Ltd., has informed the Company
of his decision to resign from the Board of Directors and all
committees, effective Jan. 16, 2025, as disclosed in a Form 8-K
filed with the Securities and Exchange Commission.
SPI Energy stated Mr. Ngai did not advise the Company of any
disagreements regarding its operations, policies, or practices.
However, Mr. Ngai expressed concerns about the Company's ongoing
cash flow issues, which he believes have led to several key issues,
including: (i) a failure to adequately address its material
weaknesses, (ii) insufficient maintenance of Directors & Officers
(D&O) insurance, (iii) delays in paying its expenses, including
approximately US$398,000 in director compensation owed to him, and
(iv) difficulties in complying with its reporting obligations under
the Securities Exchange Act of 1934 in a timely manner.
About SPI Energy
SPI Energy Co., Ltd. is a global renewable energy company and
provider of solar storage and EV solutions that was founded in 2006
in Roseville, California and is now headquartered in McClellan
Park, California. SPI Solar acquires, develops and sells solar
projects in multiple countries, including the U.S., the U.K.,
Greece, Japan and Italy. SPI Solar acquires and develops solar PV
projects that are either sold to third party operators or owned and
operated by Orange Power for selling of electricity to the grid.
New York, New York-based Marcum Asia CPAs LLP, the Company's
auditor since 2018, issued a "going concern" qualification in its
report dated April 14, 2023. The report cited that the Company has
a significant working capital deficit, has incurred significant
losses and needs to raise additional funds to sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
The Company suffered net losses of $44.8 million and $33.7 million
for the years ended Dec. 31, 2021 and 2022, respectively. The
Company also had an accumulated deficit of $670.8 million and a
working capital deficit of $107.7 million as of Dec. 31, 2022. In
addition, the Company has substantial amounts of debt that became
due in 2023.
The Company has not yet filed its Annual Report on Form 10-K for
the year ending Dec. 31, 2023, with the SEC. The delay is due to
the Company's inability to finalize its financial results without
incurring unreasonable expense or effort. As a result, the Company
was unable to solicit and obtain the necessary review of the Form
10-K in a timely manner prior to the report's due date.
On Jan. 13, 2025, SPI Energy received a notification letter from
The Nasdaq Stock Market LLC notifying the Company that the Nasdaq
hearings panel had determined to delist the Company's shares from
The Nasdaq Capital Market, due to the Company's violation of
Listing Rules 5250(c)(1) and 5550(a)(2), the "Bid Price
Requirement" and "Annual Shareholder Meeting" Rules.
SPIRIT AIRLINES: Moves Forward with Chapter 11 Plan Confirmation
----------------------------------------------------------------
Vince Sullivan of Law360 reports that Bankrupt budget airline
Spirit Airlines plans to pursue approval of its Chapter 11 debt
restructuring plan at a hearing on Thursday, February 13, 2025,
after merger talks with competitor Frontier Group failed.
About Spirit Airlines
Spirit Airlines, Inc. (SAVE) is a low-fare carrier committed to
delivering the best value in the sky by offering an enhanced travel
experience with flexible, affordable options. Spirit serves
destinations throughout the United States, Latin America and the
Caribbean with its Fit Fleet, one of the youngest and most
fuel-efficient fleets in the U.S. On the Web:
http://wwww.spirit.com/
Spirit Airlines and its affiliates sought Chapter 11 protection
(Bankr. S.D.N.Y. Case No. 24-11988) on Nov. 18, 2024, after
reaching terms of a pre-arranged plan with bondholders. At the time
of the filing, Spirit Airlines reported $1 billion to $10 billion
in both assets and liabilities. Judge Sean H. Lane oversees the
case.
The Debtors tapped Davis Polk & Wardwell, LLP as legal counsel;
Alvarez & Marsal North America, LLC, as financial advisor; and
Perella Weinberg Partners LP as investment banker. Epiq Corporate
Restructuring, LLC, is the claims agent.
Paul Hastings, LLP and Ducera Partners, LLC serve as legal counsel
for the Ad Hoc Group of Convertible Noteholders.
Akin Gump Strauss Hauer & Feld, LLP and Evercore Group LLC
represent the Ad Hoc Group of Senior Secured Noteholders.
The official committee of unsecured creditors retained Willkie Farr
& Gallagher LLP as counsel.
Citigroup Global Markets, Inc., is serving as financial advisor and
Latham & Watkins LLP is serving as legal counsel to Frontier.
SPLASH BEVERAGE: Signs LOI to Acquire Western Son Vodka
-------------------------------------------------------
Splash Beverage Group, Inc. announced it has signed an updated
Letter of Intent to acquire Western Son Vodka primarily through a
stock-for-equity transaction.
The addition of the Western Son revenue base will effectively
double Splash's peak trailing twelve-month revenue, significantly
expanding the Company's financial footprint. Under the proposed
structure, Western Son shareholders would receive restricted stock
in Splash Beverage Group and an approximate 10% of cash
consideration. In return, Splash would assume certain outstanding
debt obligations of WSV.
This merger structure represents an alternative to the previously
announced majority cash-based acquisition and provides a pathway to
completion that aligns the interests of both companies. The
transaction remains subject to definitive agreements, standard
regulatory approval, and a shareholder vote.
"We have always believed that Western Son Vodka would be an
outstanding addition to Splash's portfolio, which is why we have
been so persistent to bring it into the Splash Portfolio," said
Robert Nistico, CEO of Splash. "Both teams have not stopped their
work together and today is very exciting … we are very much
looking forward to working with Western Son and building the next
major spirits brand. This LOI is an important step forward, and we
are confident that structuring the deal as an equity exchange gives
us a clearer path to completion. We believe our shareholders are
very much in favor of this as it adds significant revenue and
operational efficiencies, shortens our path to profitability, and
will be accretive. We look forward to working together in a unified
manner as we move forward on this important transaction."
Western Son Vodka, founded in 2011 and located in Pilot Point,
Texas, is an award-winning craft vodka with a growing national
footprint. The brand's 10X distilled vodka, made with 100% American
corn, has earned multiple industry awards and continues to expand
its national distribution. Western Son Vodka won the 2024 Newsweek
Readers' Choice Award for Best Vodka voted on by consumers
(https://www.newsweek.com/readerschoice/best-vodka).
Carlos Guillem, Western Son's President, said, "The new LOI marks a
significant milestone for Western Son Vodka. This strategic move
strengthens our foundation for continued expansion, enhances our
market presence, and reinforces our commitment to delivering the
exceptional quality our consumers expect. We are excited about the
future and the opportunities this partnership creates. Together, we
are building a stronger, more innovative Western Son Vodka for our
customers and stakeholders."
The Company will provide additional updates as key milestones are
achieved. The two companies are targeting to close the transaction
this quarter.
About Western Son
Western Son Vodka is a premium craft spirits brand known for its
high-quality, smooth vodka and innovative flavors. Born from a
group of entrepreneurs who left behind the corporate world to
pursue their passion, Western Son blends tradition with creativity,
using the finest ingredients and a 10x distillation process to
craft exceptional vodka with a clean finish. With real fruit and a
commitment to quality, the brand has become a favorite among vodka
lovers. Rooted in the "Spirit of the West," Western Son is proud of
its Texas heritage and continues to push the boundaries of vodka
craftsmanship. For more information, visit
https://www.westernsondistillery.com or follow the brand on
Instagram, Facebook, Linkedin and TikTok.
About Splash Beverage Group
Fort Lauderdale, Florida-based Splash Beverage Group, Inc. is a
portfolio company specializing in managing multiple brands across
various growth segments within the consumer beverage industry. The
Company focuses on incubating and acquiring brands with the aim of
accelerating them to higher volumes and increased sales revenue.
Rose, Snyder & Jacobs, based in Encino, California, and the
Company's auditor since 2023, issued a "going concern"
qualification in its report dated March 29, 2024. The qualification
highlighted that the Company has experienced recurring losses from
operations, an accumulated deficit, and a working capital
deficiency, which raise substantial doubt about its ability to
continue as a going concern.
Splash Beverage Group incurred a net loss of $21 million for the
year ended December 31, 2023. As of June 30, 2024, Splash Beverage
Group had $8,057,812 in total assets, $18,411,650 in total
liabilities, and $10,353,838 in total stockholders' deficit.
SPLASHLIGHT HOLDING: Case Summary & Eight Unsecured Creditors
-------------------------------------------------------------
Debtor: Splashlight Holding LLC
75 Varick Street
New York NY 10013
Business Description: Splashlight Holding LLC is the majority
equity holder of several operating
companies, including Splashlight LLC,
Mahogany Fine Foods and Catering LLC,
Splashlight Photographic & Digital Studios
LLC, and Splashlight Technologies LLC. The
Debtor, through Splashlight LLC and
Splashlight Photographic & Digital Studios
LLC, provides comprehensive production
services for still and film shoots, both in-
studio in New York City and on-location.
Their specialties include directing,
casting, production, and post-production
across various media formats, including
film, print, and digital platforms.
Additionally, its subsidiary, Mahogany Fine
Foods and Catering, provides catering and
hospitality services to Splashlight and
Splashlight Photographic & Digital Studios
clients.
Chapter 11 Petition Date: February 12, 2025
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 25-10277
Judge: Hon. Lisa G Beckerman
Debtor's Counsel: Scott Simon, Esq.
GOETZ PLATZER LLP
1 Penn Plaza Suite 3100
New York NY 10019
Tel: 212-695-8100
E-mail: ssimon@goetzplatzer.com
Total Assets: $38,979,766
Total Liabilities: $54,493,305
Estimated Assets: $50 million to $100 million
Estimated Liabilities: $50 million to $100 million
The petition was signed by James Ingram as chief executive
officer.
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/SZTLP2A/Splashlight_Holding_LLC__nysbke-25-10277__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's Eight Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Newtek Small Business Monies Loaned/ $3,564,271
Finance, LLC Advanced
1981 Marcus Avenue
Suite 130
New Hyde Park, NY, 11042
2. Boathouse Capital III Monies Loaned/ $1,500,000
Management LLC Advanced
353 W. Lancaster Avenue, Suite 200
Wayne, PA, 19087
3. Fox Rothschild LLP Services $544,000
101 Park Avenue, 17th Floor
Brian S. Cousin
New York, NY, 10178
4. CBIZ MP LLC Services $0
88 Froechlich Farm Boulevard
Woodbury, NY, 11797
5. NYC Dept. of Finance Taxes & Other $0
Office of Legal Affairs Government
375 Pearl Street, 30th Floor Units
New York, NY, 10138
6. Internal Revenue Service Taxes & Other $0
Centralized Insolvency Operations Government Units
P.O. Box 7346
Philadelphia, PA, 19101
7. NYS Dept. of Taxation & Finance Taxes & Other $0
Bankruptcy/Special Government Units
Procedures Section
P.O. Box 5300
Albany, NY, 12205
8. Delaware Division of Revenue/ Taxes & Other $0
Bankruptcy Service Government Units
Attn: Bankruptcy Administrator,
Carvel State Building
820 N. French Street, 8th Floor
Wilmington, DE 19801
SRAM LLC: S&P Affirms 'BB-' Issuer Credit Rating, Outlook Stable
----------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issue level rating and '3'
recovery rating to the proposed senior secured credit facility.
At the same time, despite modestly higher leverage, S&P affirmed
its 'BB-' issuer credit rating on SRAM LLC because it expects a
good cushion compared to our 4x downgrade threshold through 2026.
S&P said, "The stable outlook reflects our expectation that SRAM
will grow revenue in the low to mid-single digits through 2026 and
its financial policy of using excess cash flow to repay debt will
support a sustained reduction in leverage below our 4x downgrade
threshold.
"We affirmed the 'BB-' issuer credit rating, with a stable outlook
because we anticipate it will maintain a good cushion below our 4x
downgrade threshold through 2026. In 2024, the company's revenue
declined by about 10.4% on a year over year basis, as the bicycle
component industry continued to experience an order flow and
inventory correction brought on from a surge in orders in 2022 to
mitigate persistent supply chain issues prevalent during the
pandemic coupled with an overestimation of consumer demand. Demand
for new products and strong aftermarket sales beginning in the
third quarter of 2024 provided a modest offset, indicating good
ridership trends. While industry inventory levels are improving,
most notably at the high-end road category, we believe they will
remain elevated through at least the first half of 2025, especially
in the middle to low-end segments as consumers continue to balance
persistently high prices and cost fatigue. In 2025, we expect
SRAM's revenue to be up low single digits supported by new product
launches, such as its new RED group set, good ridership trends, and
production increases in the high-end categories. We expect leverage
to be flat in 2025 as modest topline growth is offset by modest
margin compression due to mix shift in products, bonus
compensation, and competitor pricing. This translates to S&P Global
Ratings' lease adjusted leverage in the mid 3x area in 2025.
"We expect SRAM to continue its financial policy of using excess
cash flow to paydown debt supporting the stable outlook. In 2024
SRAM used $106 million in excess free cash flow to pay down debt.
While we expect minimal debt repayment in 2025, we assume SRAM
maintains its policy of using its discretionary cash flow after
distributions to repay debt in future years while leverage is above
its 3x maximum policy target, which we assume could be between $50
million to $100 million per year. In addition, the company's policy
is to pay about 20% of operating income as a distribution to
shareholders. We do not assume any special distributions under our
current base case.
"Prolonged material tariffs could lead to more profit volatility.
While we believe SRAM's direct exposure to tariffs is minimal, an
indirect impact could lead to headwinds for its OEM customers and
cause a reduction in order flow compared to our base case. The
industry manufactures and assembles a majority of its products in
Taiwan. While SRAM's OEM customers will ultimately bear the direct
cost of tariffs, this could complicate inventory and order flow in
an industry still working through elevated inventory levels. OEM's
will need to decide on pricing strategies that best align with
inventory levels and demand and could face margin pressure as well
as affect future orders. We believe there is a high degree of
unpredictability around policy implementation by the U.S.
administration and possible responses regarding tariffs. We will
gauge the credit materiality of potential and actual tariff policy
shifts and reassess our base case accordingly."
Despite the heightened volatility, cycling continues to show good
underlying trends. The global cycling market is poised for growth,
primarily due to the increasing adoption of bicycles in both
developed and developing economies because of shifts in consumer
preferences toward a healthy lifestyle, resulting in more people
opting for cycling as a daily commuting activity and form of
leisure. Similarly, bike-component manufacturers have benefited
from good ridership trends in the U.S and Europe over the past
several years, with a persistent boom in interest following the
pandemic. Recently SRAM has experienced strong aftermarket sales
indicating healthy riding trends which should translate into future
demand in its OEM segment. After the assumed completion of the
industry inventory correction in 2025, S&P expects SRAM will
continue to benefit from the industry's good underlying demand and
increase its revenue by the low to mid-single digit percent area in
2026.
S&P said, "We believe the company will require continued product
innovation to maintain its market share and competitive edge.
Although SRAM increased its market share in recent years with
successful product launches, its short product life cycles may lead
to volatility in its revenue if its future products are not as
successful. The company operates in the highly competitive,
high-end bicycle component manufacturing industry, which requires
it to consistently invest in innovation and develop new products to
maintain its market share. As a result, SRAM derives half of its
gross profit from products that are less than three years old. The
company's industry peers often incur sizable R&D expenses to keep
up with new trends, retain consumer interest, and protect their
market share. This spending could impair SRAM's profitability if
its revenue declines, given that we believe it would be hesitant to
reduce its spending."
SRAM's No. 2 position in a highly competitive industry exposes it
to potential disruptions at its manufacturing facilities and
elevated business risk. The company manufactures about 85% of its
products in Taiwan. Additionally, the bicycle OEMs are largely
located in Taiwan. Significant geographic concentration exposes
SRAM to potential disruptions from low-probability, high-impact
events, like natural disasters and regional conflicts. Furthermore,
the company's largest competitor, Shimano, can invest significantly
more in R&D, due to its larger scale, to develop new products that
help it retain consumer interest and maintain its market share,
which could put SRAM at a disadvantage.
S&P said, "The stable outlook reflects our expectation that SRAM
will grow revenue in the low to mid-single digits through 2026 and
its financial policy of using excess cash flow to repay debt will
support a sustained reduction in leverage below our 4x downgrade
threshold.
"We could lower our rating on SRAM if it pursues a large leveraging
distribution or other transaction or its revenue and EBITDA decline
such that it sustains leverage of above 4x.
"Although unlikely, we would consider upgrading SRAM if it used
significant excess free cash flow for voluntary debt repayment,
continued to expand its OEM and aftermarket volumes, and we
expected its revenue and EBITDA growth can keep its lease-adjusted
leverage comfortably below our 3x upgrade threshold. This would
incorporate potentially high volatility in its business, large
acquisitions, or future leveraging distributions that would likely
require a change in SRAM's current financial policy of tolerating
leverage of up to 3x."
SWAN PIZZA: Updates Unsecured Claims Details; Amends Plan
---------------------------------------------------------
Swan Pizza, Inc., submitted a Third Amended Plan of Reorganization
for Small Business dated January 31, 2025.
The Debtor's sales remain steady and strong and monthly operating
expenses remain stable with major costs by employees and food
supplies. Since filing this case, the Debtor show ability to fund
all operating expenses, secured and priority creditors to provide a
dividend to unsecureds.
The Debtor believes that it has been able to reorganize
successfully and that the following plan is feasible and fair to
creditors. The rent arrears will be made current within 10 months
paid in equal monthly installments. The State of Florida and
secured claims will be paid within 60 months. Unsecured creditors
till receive a distribution that is more than they would received
in a Chapter 7 liquidation.
Class 3 consists of Non-priority unsecured creditors. Creditors of
Class 3 include Unsecured Channel Partners Capital, LLC
($95,618.31); Jokim, LLC unpaid rent of $28,245.81; and Internal
Revenue Service ($1,500.00). The allowed unsecured claims total
$125,364.12.
The Plan will be implemented and payments made for ongoing income
from the business.
Business has sufficient income to pay all ongoing, upcoming debts
and to make the payments specified in the Plan. The Debtor
anticipated a $2,000 reserve for emergencies. The only officer
involved will be Ashraf Chehata, president.
A full-text copy of the Third Amended Plan dated January 31, 2025
is available at https://urlcurt.com/u?l=GCnHqo from
PacerMonitor.com at no charge.
About Swan Pizza
Swan Pizza, Inc., sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 24-03735) on July 22,
2024, with up to $50,000 in assets and up to $500,000 in
liabilities.
Judge Tiffany P. Geyer presides over the case.
Robert H. Zipperer, Esq., is the Debtor's legal counsel.
SWITCHBACK COFFEE: Updates SBA Secured Claim; Files Amended Plan
----------------------------------------------------------------
Switchback Coffee Roasters, Inc. submitted an Amended Subchapter V
Plan of Reorganization dated January 31, 2025.
The bankruptcy filing was prompted due to its cash flow being
unable to meet its current debt obligations, including an expensive
merchant advance loan. Much of the Debtor's problems originated
from the Covid pandemic. A restructuring of the Debtor's debt will
allow it to operate profitably.
Class 2 consists of the U.S. Small Business Administration, or its
successors or assigns. The Class 2 Secured Claim is not modified by
this Plan except that any monetary default shall be added to the
end of the loan and the loan shall be deemed extended such that the
Debtor shall continue to make regular monthly payments until the
default is cured and the loan paid in full. Since Class 2 is
impaired by the Plan, the SBA had a right to and given the
opportunity vote on the previously filed Plan.
Class 6 consists of general unsecured creditors of the Debtor who
hold Allowed Claims. Holders of Class 6 Allowed Claims shall share
on a Pro Rata basis monies deposited into the Unsecured Creditor
Account as set forth herein. As set forth in Article III, paragraph
3.2 of this Plan, upon the first full month following the Effective
Date of the Plan and every month until Administrative Claims are
paid in full and then for the remainder of the Term of the Plan the
Debtor will every month in accordance with the terms of this Plan
deposit for the five year Term of the Plan: (a) during the first
year of the Plan $1,551.74; (b) during the second year of the Plan
$1,773.14; (c) during the third year term of the Plan $2,426.15;
(d) during the fourth year of the Plan $2,400.72 and (e) during the
fifth year of the Plan $2,373.45.
At the end of each calendar quarter, the balance of the Unsecured
Creditor Account will be distributed to the holders of Allowed
Administrative Claims on a Pro Rata basis until such time as all
holders of Allowed Administrative Claims have been paid in full and
then to Tax Claims and Class 1 on a Pro Rata Basis until paid in
full and then will be distributed to Class 6 general unsecured
creditors that hold Allowed Claims on a Pro Rata basis. The account
will be maintained at a federally insured banking institution and
shall be maintained within the insurance limit of the institution.
All funds recovered by the Debtor on account of Avoidance Actions
shall be distributed to Allowed Administrative Claims until paid in
full and then to Class 6, net of attorneys' fees and costs. Whether
or not the Debtor pursues any Avoidance Actions shall be up to the
Debtor and the decision to pursue such claims shall be
discretionary with the Debtor.
Class 7 includes the Interests in the Debtor, which Interests are
unimpaired by the Plan. Upon confirmation of the Plan, all Class 7
Interest holders will retain their ownership Interests in the
Debtor.
The Debtor shall be empowered to take such action as may be
necessary to perform its obligations under this Plan.
On the Effective Date of the Plan, the Debtor will open a separate
interest-bearing deposit account at a federally insured commercial
bank selected by the Debtor. The bank account will be maintained by
the Debtor as the Unsecured Creditor Account into which all
payments made by the Debtor for the benefit of holders of Allowed
Administrative Claims, Class 1 and Class 6 creditors will be made
until the obligations under the Plan are completed.
The Debtor believes that the Plan, as proposed, is feasible. The
funding for the Plan will come from the Debtor's continued
operations. As detailed in the Projections, the Debtor will have
sufficient cash on hand and profits during the term of the Plan to
satisfy its Plan obligations.
A full-text copy of the Amended Subchapter V Plan dated January 31,
2025 is available at https://urlcurt.com/u?l=uHvzIs from
PacerMonitor.com at no charge.
Counsel to the Debtor:
Aaron A. Garber, Esq.
Wadsworth Garber Warner Conrardy, P.C.
2580 West Main Street, Suite 200
Littleton, CL 80120
Telephone: (303) 296-1999
Facsimile: (303) 296-7600
Email: agarber@wgwc-law.com
About Switchback Coffee Roasters
Switchback Coffee Roasters, Inc. is a neighborhood coffee shop and
cafe that opened its doors in 2015.
The Debtor filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Colo. Case No. 24-14822) on Aug. 19,
2024, with as much as $1 million in both assets and liabilities.
Judge Thomas B. McNamara oversees the case.
Aaron A. Garber, Esq., at Wadsworth Garber Warner Conrardy, PC
serves as the Debtor's legal counsel.
TALEN ENERGY: Wins Bid to Reclassify GE's Claims as Unsecured
-------------------------------------------------------------
Judge Marvin Isgur of the United States Bankruptcy Court for the
Southern District of Texas held that GE Steam Power Inc. and
General Electric International, Inc.'s claims secured by unrecorded
constitutional mechanics liens under Texas law will be treated as
general unsecured claims in the bankruptcy case of Talen Energy
Corp.
Proofs of Claim Nos. 2911, 37563 & 37564 assert secured claims
aggregating $758,756.42. Talen's objection seeks to reclassify GE's
certain secured claims as unsecured claims pursuant to Secs.
502(b)(1), 544(a)(3).
The statute of limitations precludes Talen from affirmatively
avoiding the unrecorded liens under Sec. 544. 11 U.S.C. Sec.
546(a). The issue is whether Talen can use its Sec. 544(a)(3)
powers defensively against the enforcement of the constitutional
liens securing the claims.
Talen is not seeking to avoid the unperfected constitutional liens
subject to the statute of limitations under Sec. 546. The
limitations period has run on a Sec. 546 avoidance action. Rather,
Talen is seeking to assert its affirmative defense as a bona fide
purchaser against the enforceability of the constitutional lien.
According to the Court, Sec. 546 does not impose a limitations
period on Talen's ability to assert its status as a bona fide
purchaser and raise any affirmative defenses.
GE argues that Sec. 544(a)(3) does not permit Talen's defensive use
of its BFP status to subordinate a secured claim into an unsecured
claim based on the unenforceability of the underlying lien when the
statute of limitations to avoid the lien expired under Sec. 546.
Based on the disjunctive language of Sec. 544(a)(3), GE claims that
the rights and powers of a BFP must be separate and distinct from
the enumerated avoidance power.
Because Talen's status as a bona fide purchaser is not
time-limited, it may assert its BFP status defensively, the Court
finds.
Because Talen can raise its BFP defense, the unrecorded
constitutional liens are unenforceable. Proofs of Claim Nos. 2911,
37563 & 37564 are reclassified as general unsecured claims, the
Court concludes.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=OKJfpi from PacerMonitor.com.
About Talen Energy Corp.
Allentown, Pennsylvania-based Talen Energy Corp. is an independent
power producer founded in 2015. Riverstone Holdings LLC completed
its acquisition of the remaining 65% stake of Talen Energy in 2016
for $5.2 billion.
Talen Energy Corporation, through subsidiary Talen Energy Supply
LLC, is one of the largest competitive power generation and
infrastructure companies in North America. Through subsidiary
Cumulus Growth, TEC is developing a large-scale portfolio of
renewable energy, battery storage, and digital infrastructure
assets across its expansive footprint. On the Web:
https://www.talenenergy.com/
TES owns and/or controls approximately 13,000 Megawatts of
generating capacity in wholesale U.S. power markets, principally in
the Mid-Atlantic, Texas and Montana. Woodlands, Texas-based TES
runs 18 power generation facilities, at eight of which rely on
natural gas to make electricity.
Talen Energy Supply, LLC, and 71 affiliates sought
Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 22-90054) on
May 9, 2022. The Hon. Marvin Isgur is the case judge.
Talen Energy Corporation (TEC), its Cumulus Growth subsidiary, and
TES' LMBE subsidiaries are excluded from the in-court process.
TES has retained Weil Gotshal & Manges LLP as its legal advisor,
Evercore as its investment banker and Alvarez & Marsal as its
financial advisor for its restructuring. Kroll is the claims
agent.
TEC is represented by PJT Partners as financial advisors and Vinson
& Elkins as legal counsel.
Cumulus Growth is represented by Ardea Partners and DH Capital as
its investment bankers, and Gibson Dunn as legal counsel.
The Consenting Noteholders are represented by Kirkland & Ellis LLP
and Rothschild & Co US Inc.
TERVIS TUMBLER: Emerges From Bankruptcy With Debt Resolved
----------------------------------------------------------
Tervis, the nationally loved and family-owned drinkware company
founded in 1946, announced it has exited Chapter 11 bankruptcy with
all litigation dismissed and debt resolved. The reorganization took
a little more than five months; the firm entered Chapter 11 on
September 6, 2024.
The confirmation hearing to exit Chapter 11 took place at the Tampa
Federal Courthouse on Tuesday, February 11 at 9:30 a.m.
"The business decision to reorganize was to better position and
strengthen this brand's legacy for a long and successful future,"
said Hosana Fieber, chief executive officer of Tervis. "Now we plan
to invest in this family-owned brand and its products, that are
both made to last."
During the hearing, company executives unveiled a "Made to Last"
Tervis tumbler to commemorate the occasion. It was noted during the
hearing that the firm settled a large lingering lawsuit, made deals
with all creditors and is moving forward with no pending litigation
and a low debt balance sheet.
"We're thrilled with the future vision of the company and the
leadership and strategies in place to bolster the brand and grow,"
said Rogan Donelly, chairman of the board for Tervis. "The board
has full confidence in our team's ability to build back better and
stronger than ever before and we will do that by investing in
innovation and our core strengths."
That investment includes its business strategy to return to its
legacy and focus on product for home occasions versus on-the-go
occasions. The sub-brand, TervisHome, with its new product category
launch of melamine, will accompany the Classic Drinkware Portfolio,
which ranks within the Top 10 of plastic and acrylic drinkware.
The Tervis brand will focus on stabilizing the business and
promoting its first entrance into the dinnerware category with the
line of melamine products that complement its tumblers, with four
design sets that include dinner plates, salad plates and bowls.
"Tervis has unique, long-standing and close relationships with
vendors due to our culture and our organization remains deeply
committed to leaning on our core values and strong family legacy to
uphold our brand for our customers and stakeholders far into the
future," said Fieber.
About Tervis Tumbler Co.
Tervis Tumbler Co. -- https://www.tervis.com/ -- is a third
generation American-owned and operated company, renowned for the
durable construction of its drinkware, the timelessness of its
decorations and designs, and the insulation qualities.
Tervis sought relief under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. M.D. Fla. Case No. 24-05274) on Sept. 5, 2024, with $10
million to $50 million in both assets and liabilities. Hosana
Fieber, president and chief executive officer of Tervis, signed the
petition.
Judge Roberta A. Colton oversees the case.
The Debtor is represented by:
Steven M Berman, Esq.
Shumaker, Loop & Kendrick, LLP
Tel: (813) 229-7600
Email: sberman@shumaker.com
TEXAS OILWELL: Seeks Subchapter V Bankruptcy Protection in Texas
----------------------------------------------------------------
On February 7, 2025, Texas Oilwell Partners LLC filed Chapter 11
protection in the U.S. Bankruptcy Court for the Southern District
of Texas.
According to court filing, the Debtor reports between $1 million
and $10 million in debt owed to 1 and 49 creditors. The petition
states funds will be available to unsecured creditors.
About Texas Oilwell Partners LLC
Texas Oilwell Partners LLC is a privately-held company that
specializes in cutting-edge technology for extended reach, fishing,
and gas separation within coiled tubing and workover rig
applications.
Texas Oilwell Partners LLCsought relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 25-30750) on
February 7, 2025. In its petition, the Debtor reports estimated
assets up to $50,000 and estimated liabilities between $1 million
and $10 million.
Honorable Bankruptcy Judge Eduardo V. Rodriguez handles the
case.
The Debtor is represented by:
Brandon Tittle, Esq.
TITTLE LAW GROUP, PLLC
1125 Legacy Dr., Ste. 230
Frisco, TX 75034
Tel: 972-213-2316
Email: btittle@tittlelawgroup.com
THINK GOODNESS: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Think Goodness, LLC
f/k/a Origami Owl, LLC
575 East Germann Road
Suite 101
Gilbert, AZ 85297
Business Description: Think Goodness offers a curated selection of
jewelry, skincare, makeup, and wellness
products. They focus on providing
thoughtfully designed, customizable items
from reputable brands, aiming to enhance
both appearance and well-being. Originally
known as Origami Owl, Think Goodness
transitioned from a multi-level marketing
(MLM) model to a single-level distribution
model as of Sept. 1, 2023.
Chapter 11 Petition Date: February 12, 2025
Court: United States Bankruptcy Court
District of Arizona
Case No.: 25-01160
Debtor's Counsel: Grant L. Cartwright, Esq.
MAY POTENZA BARA & GILLESPIE, P.C.
1850 N. Central Ave., Suite 1600
Phoenix, AZ 85004
Tel: (602) 252-1900
E-mail: gcartwright@maypotenza.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Chrissy Weems as manager.
The Debtor did not provide a list of its 20 largest unsecured
creditors in the petition.
A full-text copy of the petition is available for free on
PacerMonitor at:
https://www.pacermonitor.com/view/R353A6Y/Think_Goodness_LLC__azbke-25-01160__0001.0.pdf?mcid=tGE4TAMA
TIME OUT PROPERTIES: Baker Donelson Advises USBEF & Deere Parties
-----------------------------------------------------------------
The law firm of Baker, Donelson, Bearman, Caldwell & Berkowitz, PC,
filed a verified statement pursuant to Rule 2019 of the Federal
Rules of Bankruptcy Procedure to disclose that in the Chapter 11
cases of Time Out Properties, LLC and affiliates, the firm
represents multiple creditors.
Destiney Parker-Thompson, of Baker Donelson, represents U.S. Bank,
National Association d/b/a U.S. Bank Equipment Finance ("USBEF").
USBEF is a secured creditor of debtor Top Park Services, LLC based
on certain pre-petition finance agreements secured by equipment
used in the Debtor's business operations.
Jill C. Walters, also of Baker Donelson, represents secured
creditors Deere & Company and John Deere Construction & Forestry
Company (collectively, the "Deere Parties") in this Chapter 11
Case.
Deere Parties filed a secured claim against Top Park for
pre-petition amounts owed to them, respectively, based on certain
pre-petition contracts under which the Deere Parties loaned the
Debtor funds to finance certain personal property in the operation
of Top Park's business.
The law firm can be reached at:
BAKER, DONELSON, BEARMAN, CALDWELL & BERKOWITZ, PC
Destiney Parker-Thompson, Esq.
2235 Gateway Access Point, Suite 220
Raleigh, North Carolina 27607
Telephone: (984)844-7942
Email: dparkerthompson@bakerdonelson.com
About Time Out Properties
Time Out is a holding company that owns 100% of the equity in each
of Prairie Knolls, Grand Valley MHP, LLC, and Rolling Acres MHC,
LLC, each of which own and operate a mobile home park.
Time Out Properties, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. N.C. Case No. 24-19722) on
September 20, 2024, with $1 million to $50 million in both assets
and liabilities. The petition was signed by Neil Carmichael Bender,
II as manager.
Judge Scott M Grossman oversees the case.
The Debtor is represented by Bradley S. Shraiberg, Esq. at
Shraiberg Page P.A.
TONIX PHARMACEUTICALS: Fogarty Named First Chief Technology Officer
-------------------------------------------------------------------
Tonix Pharmaceuticals Holding Corp. disclosed in a Form 8-K Report
filed with the U.S. Securities and Exchange Commission that the
Board of Directors appointed Siobhan Fogarty as the Company's Chief
Technology Officer on February 3, 2025. Ms. Fogarty's annual salary
is EUR385,000, and she is eligible for an annual bonus and equity
awards.
Ms. Fogarty, age 56, has worked for Tonix Pharma Limited, a
wholly-owned subsidiary of the Company, since September 2016,
holding roles with increasing responsibility, most recently as
Executive Vice President, Product Development, since February 2021,
and prior to that as Vice President, Product Development, since
February 2019. Ms. Fogarty earned a Bachelor of Science in
Industrial Chemistry from the University of Limerick, and a Masters
in Pharmaceutical Science from the School of Pharmacy, Trinity
College Dublin.
There are no arrangements or understandings between Ms. Fogarty and
any other person pursuant to which Ms. Fogarty was appointed as an
officer of the Company. There are no family relationships between
Ms. Fogarty and any director or executive officer of the Company.
Ms. Fogarty is not a party to any transaction required to be
disclosed pursuant to Item 404(a) of Regulation S-K.
Ms. Fogarty joined Tonix in 2016 and previously served as Executive
Vice President of Product Development. Ms. Fogarty has over 25
years of experience in pharmaceutical and biotech product
development, manufacturing and quality, for both small and large
molecules, at notable pharmaceutical and biotech companies.
In December, Tonix announced that the U.S. Food and Drug
Administration (FDA) assigned a Prescription Drug User Fee Act
(PDUFA) goal date of August 15, 2025, for a decision on marketing
authorization for TNX-102 SL (cyclobenzaprine HCl sublingual
tablets) 5.6 mg for the management of fibromyalgia. TNX-102 SL is a
non-opioid, centrally-acting analgesic. Fibromyalgia is a common
chronic pain condition that affects mostly women.
"Siobhan is an invaluable member of our team and an outstanding
leader who has contributed in many ways to our success since she
joined in 2016, and we are excited that she is executing at a
higher level in her new role as our first CTO," said Seth Lederman,
M.D., President and Chief Executive Officer of Tonix
Pharmaceuticals. "Her energy, insights and organizational abilities
will be welcome as we enter into a landmark time for the Company
with the upcoming PDUFA goal date of August 15, 2025, for TNX-102
SL for the management of fibromyalgia. In addition to her
stewardship of TNX-102 SL, Siobhan has played key roles advancing
our pipeline of small molecule, biologics and live-virus
vaccines."
Ms. Fogarty started her career with Elan Corporation as a
formulation scientist where she gained experience in several
different areas of drug delivery, including solid, liquids, IV, and
transdermal formulations. At Elan, she took products from concept
to commercial manufacture in both Ireland and the U.S. Ms. Fogarty
moved to Glaxo SmithKline, London, as a manufacturing strategist
after the merger of Glaxo and SmithKline Beecham. Returning to
product development, Ms. Fogarty established European product
development sites for Fuisz Technologies and Biovail Corporation,
leading multi-disciplinary teams for the development of products
from early conceptual/preclinical development, through the various
clinical phases and transferring to U.S./Canadian manufacturing
sites during registration for commercialization. Subsequently, Ms.
Fogarty started a consultancy firm, eMSc, that advised
pharmaceutical and biotech companies in product development and
implementation of a phased approach to quality. Ms. Fogarty
obtained her masters in Pharmaceutical Sciences at Trinity College,
Dublin, and is a European Union Qualified Person. Her primary
degree is in Industrial Chemistry from the University of Limerick
where she interned at Pfizer.
"I am grateful for the incredible eight years I have already
enjoyed working at Tonix and look forward to the challenges and
opportunities of my new role," said Ms. Fogarty. "Tonix is entering
a momentous time, and it is an honor to assume these new
responsibilities as part of this extraordinary team."
About Tonix Pharmaceuticals
Chatham, N.J.-based Tonix Pharmaceuticals Holding Corp., through
its wholly owned subsidiary Tonix Pharmaceuticals, Inc., is a fully
integrated biopharmaceutical company focused on developing and
commercializing therapeutics to treat and prevent human disease and
alleviate suffering.
As of September 30, 2024, Tonix had $95 million in total assets,
$20.8 million in total liabilities, and $74.2 million in total
equity.
Going Concern
The Company cautioned in its Form 10-Q report for the quarter ended
March 31, 2024, that there is substantial doubt about its ability
to continue as a going concern. The Company has suffered recurring
losses from operations and negative cash flows from operating
activities. As of March 31, 2024, the Company had working capital
of approximately $9.6 million and an accumulated deficit of
approximately $615.6 million. The Company held cash and cash
equivalents of approximately $7 million as of March 31, 2024.
During the fourth quarter of 2023, the Company engaged CBRE, an
international real estate brokerage firm, to potentially find a
strategic partner for or buyer of its Advanced Development Center
in North Dartmouth, Massachusetts, to align with its current
business objectives and priorities. As of March 31, 2024, the
Company does not have a commitment in place to sell the building.
The Company believes that its cash resources at March 31, 2024, and
the gross proceeds of $4.4 million raised from an equity offering
in the second quarter of 2024, will not meet its operating and
capital expenditure requirements through the second quarter of
2025.
TREES CORP: To Acquire Chronic Therapy Dispensary for $1.75M
------------------------------------------------------------
Trees Corporation disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that the Company, through
its subsidiary Trees Colorado LLC, entered into a Membership
Interest Purchase Agreement with Beddor Claude LLC d/b/a Chronic
Therapy and the equity owners of Chronic, pursuant to which the
Company agreed to acquire all of the membership interests of
Chronic, principally consisting of a licensed dispensary located in
Wheat Ridge, Colorado. The purchase price for the acquisition of
Chronic is $1,750,000, of which $1,487,500 is to be paid upon the
closing, and the remaining $262,500 is to be held back for a period
of up to two years to satisfy indemnification obligations of
Chronic and the equity owners.
As part of the transaction, the Company and an affiliate of Chronic
entered into a new lease for an initial term of five (5) years,
with two additional five-year renewal options. Base rent for the
lease is $8,600 per month for the first year, with yearly increases
to $9,679 in the fifth year of the term. The lease provides for
standard 'triple net' costs to be borne by the Company.
Commencement of the lease does not begin until, and is fully
subject to, the closing of the acquisition and becomes null and
void if the closing does not occur by June 30, 2025.
The acquisition is subject to certain conditions, including
regulatory approval of the Colorado Marijuana Enforcement
Division.
About Trees Corporation
Trees Corporation is a cannabis company at the intersection of
community, content, and commerce. Listed on Cboe Canada, Trees
offers a differentiated retail experience, that aims to educate,
amplify and unlock emerging consumer segments and need states that
allows Trees to uniquely engage the 360-cannabis consumer. The
Trees Group currently has 13 branded Trees storefronts in Canada,
including 9 stores owned and operated in Ontario and 4 stores owned
and operated in BC.
Going Concern
For the quarterly period ended September 30, 2024, the Company
cautioned that it has incurred recurring losses and negative cash
flows from operations since inception and have primarily funded its
operations with proceeds from the issuance of debt and equity. The
Company incurred a net loss of $3,033,403 and lost $724,309 in cash
from operations during the nine months ended September 30, 2024,
respectively, and had an accumulated deficit of $103,535,443 as of
September 30, 2024. It had cash and cash equivalents of $245,367 as
of September 30, 2024. The Company expects its operating losses to
continue into the foreseeable future as it continues to execute its
acquisition and growth strategy. As a result, the Company has
concluded that there is substantial doubt about its ability to
continue as a going concern.
The Company's ability to continue as a going concern is dependent
upon its ability to raise additional capital to fund operations,
support its planned investing activities, and repay its debt
obligations as they become due. If the Company is unable to obtain
additional funding, the Company would be forced to delay, reduce,
or eliminate some or all of its acquisition efforts, which could
adversely affect its growth plans.
As of September 30, 2024, Trees Corporation had $21,159,317 in
total assets, $23,782,654 in total liabilities, and $2,623,337 in
total stockholders' deficit.
TRINITY PLACE: Inks Stock Purchase Deal With Steel IP Investments
-----------------------------------------------------------------
Trinity Place Holdings Inc. disclosed in a Form 8-K Report filed
with the U.S. Securities and Exchange Commission that the Company
entered into a Stock Purchase Agreement with TPHS Lender LLC and
Steel IP Investments, LLC, an affiliate of Steel Partners Holdings
L.P., pursuant to which Steel IP Investments has agreed to purchase
from TPHS Lender 25,862,245 shares of common stock, par value $0.01
per share of the Company in accordance with the terms and
conditions of the Stock Purchase Agreement.
The aggregate consideration payable to TPHS Lender is $2,586,200
for the Shares and certain agreements pursuant to the Stock
Purchase Agreement.
At the closing of the transactions contemplated by the Stock
Purchase Agreement, the Company, TPHS Lender and Steel IP
Investments will enter into certain ancillary agreements. Trinity
Place Holdings entered into the Stock Purchase Agreement, and will
enter into the other Transactions, with a view toward, among other
things, achieving significant operational synergies, including
through the use of Steel Partners' corporate services and
participation in Steel Partners operational excellence programs.
Conditions to Closing
The obligations of the Seller and the Purchaser to consummate the
Transactions are subject to the satisfaction or waiver of certain
closing conditions, including:
* with respect to the Purchaser, among other things:
(a) the assumption by the Seller of the Company's
guarantee under a loan relating to the Company's property in
Paramus, New Jersey owned by TPHGreenwich Holdings LLC,
(b) the Company shall have received waivers from certain
service providers of the Company with respect to legacy fees
incurred by the Company,
(c) the Company and the Purchaser shall have entered into
the Purchaser Stockholders' Agreement,
(d) the partial termination by the Company and the Seller
of that certain stock purchase agreement, dated January 5, 2024, by
and between the Company and the Seller, except for any provisions
of the Seller SPA which would cause an impairment or termination of
the Seller's representation and warranty insurance policy obtained
concurrently with the Seller SPA, and the termination and
cancellation of the Seller's right to receive penny warrants of the
Company equivalent to 5% of the Company's Common Stock and
(e) the termination and forfeiture of registration rights
held by certain securityholders of the Company; and
* with respect to the Seller, among other things:
(a) the operating agreement of the JV Entity shall be
amended, to, among other things, remove any Company decision-making
and/or consent rights with respect to the New Jersey Property and
the JV Entity,
(b) the Company shall have released the JV Entity's
obligation to pay, call capital and/or otherwise reserve for any
such D&O insurance coverage (including insurance tail coverage) and
the Seller's obligation to hold back proceeds from the sale of
property for any insurance policies of the Company,
(c) the Company shall
(i) have provided Seller with an irrevocable written
right to cause the Company, at any time after the date that is 90
days following the date of the Closing, to convey all of the
Company's 95% ownership interest in the JV Entity and its right to
distributions under the operating agreement of the JV Entity, into
a trust established for the benefit of the Company's shareholders
of record on a date to be determined and
(ii) have entered into the AMA Termination Agreement
and
(d) the Waiver Condition is satisfied.
Termination
The Stock Purchase Agreement may be terminated by either party if
the Closing has not have occurred within 30 days; provided that the
terminating party cannot terminate if the breach by such party is
the principal cause.
Purchaser Stockholders' Agreement
On the SPA Effective Date and in connection with the Transactions,
the Company and the Purchasers entered into a shareholder rights
agreement, which will become effective upon the Closing Date.
The Purchaser Stockholders' Agreement contains various covenants
including, among others:
* The Company will take all necessary corporate actions and
obtain all necessary approvals so that, as of the Closing Date, the
Company's board of directors consists of five members, who will
initially be:
(i) Jack L. Howard (Chairman),
(ii) Alexander C. Matina,
(iii) Joseph Martin,
(iv) Jeffrey S. Wald, and
(v) Joanne M. Minieri.
Subsequently, the Company has agreed that so long as Purchaser owns
at least 20% of the Company's outstanding capital stock, the
Company will take all action reasonably necessary to cause the
Board to remain at five members, which shall include:
(A) one director who shall qualify as independent and is
mutually agreed upon by Purchaser and the Company and
(B) two directors designated solely by Purchaser.
* As of the Closing Date, Matthew Messinger will act as an
observer of the Board until the earlier of:
(i) his voluntary resignation as an observer of the Board and
(ii) the Board's determination to remove Mr. Messinger as an
observer of the Board.
* The Company will continue to take steps to continue to
deregister the Company as a reporting company under the Securities
Exchange Act of 1934, as amended, including using commercially
reasonable efforts to file a Form 15 with the Securities and
Exchange Commission as soon as legally permissible after the
Closing Date.
* So long as at least 10% of the Company's total issued and
outstanding Common Stock continues to be traded on OTC Pink Market,
the Company will use commercially reasonable best efforts to, and
Purchaser agrees to provide management services to assist the
Company to, prepare and publish the information as contemplated by
Rule 144(c) of the Securities Act of 1933, as amended, including:
(i) within 45 days following each quarter of each fiscal year
and
(ii) within 90 days following each fiscal year of the Company,
(A) a consolidated balance sheet,
(B) consolidated statements of operations and
comprehensive income and of cash flows, and, as applicable, a
comparison between (x) the actual amounts as of and for such period
and (y) the comparable amounts for the prior corresponding period,
with an explanation of any material differences between such
amounts, and
(C) a consolidated statement of stockholders' equity; in
each case, prepared in accordance with GAAP and, in the case of
annual financial statements, audited and certified by independent
public accountants of recognized standing selected by the Company.
* On or prior to the Closing Date, the Company will amend its
bylaws, to provide for the ability of shareholders holding at least
an aggregate of 15% of the Company's outstanding Common Stock to
call a special meeting of the shareholders of the Company.
Following the effectiveness of the Bylaws Amendment, the Company
will not further amend the Bylaws without the prior written consent
of the Purchaser, not to be unreasonably withheld, conditioned or
delayed.
AMA Termination Agreement
On the SPA Effective Date and in connection with the Transactions,
the JV Entity and TPH Asset Manager LLC entered into a Termination
Agreement, which, among other things, provides for the termination
of that certain Asset Management Agreement, dated as of February
14, 2024, between the Asset Manager and the JV Entity, on the date
that is 45 days following the Closing Date, and waives the JV
Entity's remaining obligations thereunder.
About Trinity Place
Trinity Place Holdings Inc. is a real estate holding, investment,
development, and asset management company. On Feb. 14, 2024, the
Company's real estate assets and related liabilities were
contributed to TPH Greenwich Holdings LLC, which is owned 95% by
the Company, with an affiliate of the lender under the Company's
corporate credit facility owning a 5% interest in, and acting as
manager of, such entity. These real estate assets include: (i) the
property located at 77 Greenwich Street in Lower Manhattan, which
is substantially complete as a mixed-use project consisting of a
90-unit residential condominium tower, retail space, and a New York
City elementary school; (ii) a 105-unit, 12-story multi-family
property located at 237 11th Street in Brooklyn, New York; and
(iii) a property occupied by retail tenants in Paramus, New
Jersey.
Going Concern
The Company cautioned in its Quarterly Report for the period ended
September 30, 2024, that there is substantial doubt about its
ability to continue as a going concern. The Company said, "We have
a limited amount of unrestricted cash and liquidity available for
working capital and our cash needs are variable under different
circumstances. If the Asset Management Agreement does not remain in
place and the related fees are not increased significantly, the
Company's cash and cash equivalents will not be sufficient to fund
the Company's operations and corporate expenses beyond the next few
months, unless we are able to raise additional capital or enter
into a strategic transaction, creating substantial doubt about our
ability to continue as a going concern. There is no assurance that
we will be successful in consummating any such strategic
transaction or obtaining capital sufficient to meet our operating
needs, in each case, on terms or a timeframe acceptable to us or at
all. Even if a strategic transaction and/or other transaction is
entered into, the benefits to shareholders, if any, of such
transactions are uncertain. Further, in the event that we are
unable to identify or consummate such transactions, we would be
required to evaluate additional alternatives in restructuring our
business and our capital structure, including but not limited to,
filing for bankruptcy protection, liquidating, dissolving and/or
seeking another out-of-court restructuring of our liabilities or
liquidation."
As of September 30, 2024, Trinity Place Holdings had $3 million in
total assets, $1.5 million in total liabilities, and $1.5 million
in total stockholders' equity.
TYCO GROUP: Unsecureds Owed $241.9K Will Get 3% of Claims in Plan
-----------------------------------------------------------------
Tyco Group LLC, submitted an Amended Plan of Liquidation for Small
Business dated February 3, 2025.
This Plan of Reorganization proposes to pay creditors of the Debtor
from the sale of its Popeyes Franchise Restaurant it current
operates in San Diego.
The final Plan payment is expected to be paid when the Debtor sells
its San Diego restaurant.
Class 3(a) consists of General Unsecured Creditors, Excluding the
San Diego Lease which is classified in Class 3(b) and the Popeyes
Franchise Fee which is classified in Class 3(c). The total amount
of the allowed general unsecured claims is $ 241,880.77.
Based on the liquidation analysis and the income valuation of the
Debtor's assets, the holders of allowed general unsecured claims
will be receiving an estimated 3% pro-rata distribution through the
plan. The distribution to allowed general unsecured claims will be
made in one installment payment following the sale of the Debtor's
San Diego restaurant. This Class is impaired.
Class 3(b) consists of Landlord for the San Diego lease for
pre-petition arrears. The total amount of the allowed general
unsecured claims is $147,963.54. The Debtor will pay the
$147,963.54 in one installment payment following the sale of the
San Diego Popeyes restaurant.
Class 3(c) consists of Popeyes Louisiana Kitchen for pre-petition
royalties, advertising and related fees for the San Diego
restaurant. The total amount owed to Popeyes is $22,344.83. Debtor
will pay the $22,344.83 to Popeyes in one installment payment
following the sale of the San Diego Popeyes restaurant. Debtor
entered into Exclusive Authorization and Right to Sell or Lease of
Business and/or Real Estate ("Broker Agreement") with Stone Path
Brokerage Services Corporation regarding the sale of its
restaurant. The Broker has been actively marketing the restaurant.
The Debtor proposes to fund its Plan from the sale of the San Diego
location. Debtor entered into Exclusive Authorization and Right to
Sell or Lease of Business and/or Real Estate ("Broker Agreement")
with Stone Path Brokerage Services Corporation regarding the sale
of its restaurant. The Broker has been actively marketing the
restaurant. There are a number of interested buyers but not written
offer has been submitted yet. Once the Debtor secures an offer, the
sale motion and the broker's employment application will be filed
with the Court.
A full-text copy of the Amended Liquidating Plan dated February 3,
2025 is available at https://urlcurt.com/u?l=cvWEif from
PacerMonitor.com at no charge.
Attorney for the Debtor:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Boulevard, 6th Floor,
Beverly Hills, CA 90212
Telephone: (310) 271-6223
Facsimile: (310) 271-9805
Email: rnichael.bergerbankruptcypower.com
About Tyco Group
Tyco Group operates one Popeyes franchise restaurant at 3295 Palm
Avenue, San Diego, CA.
The Debtor filed its voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Cal. Case No. 24-11016) on
April 22, 2024, listing $50,001 to $100,000 in assets and
$1,000,001 to $10 million in liabilities.
Judge Rene Lastreto II presides over the case.
Michael Jay Berger, Esq. at the Law Offices of Michael Jay Berger
represents the Debtor as counsel.
VALARIS PLC: Bardwell's Bid for Plan Discharge, Injunction Denied
-----------------------------------------------------------------
Judge Marvin Isgur of the United States Bankruptcy Court for the
Southern District of Texas denied Jeffrey Bardwell's request for
relief from plan discharge and injunction in the bankruptcy case of
Valaris, PLC.
Bardwell seeks relief from plan discharge and injunction to assert
his personal injury and maritime tort claims against Valaris.
Bardwell's personal injury and maritime tort claims arose during
his employment with Valaris, PLC and ENSCO Inc. On May 4, 2019,
Bardwell allegedly suffered injuries to his wrist, arm, and other
parts of his body
Bardwell only seeks in personam claims so that he may pursue
insurance coverage. Bardwell's basis for relief from discharge is
the "insurer exception," which allows a creditor to seek nominal
liability against an insured debtor.
On March 3, 2021, the Bankrutcy Court entered its order confirming
Valaris' fourth amended joint chapter 11 plan of reorganization.
The Confirmation Order discharged all prepetition claims, besides
certain claims expressly preserved in the plan, against Valaris.
The plan enjoins recovery from Valaris and other affiliated debtors
on any discharged claim.
On Oct. 22, 2021, Bardwell filed a lawsuit against Valaris, PLC and
ENSCO, Inc. in Texas District Court for the County of Harris. The
lawsuit asserts tort claims arising out of Bardwell's alleged May
4, 2019 injuries.
On Nov. 18, 2021, Valaris filed a motion to dismiss the State Court
Lawsuit on the basis that Bardwell's claims were discharged by the
Court's Confirmation Order.
Relief from Plan Discharge and Injunction
Valaris alleges that it has paid the following amounts in
connection to Bardwell's May 2019 injury:
* $354,155.73 in legal fees for defending Bardwell's claim in
state and federal court,
* approximately $160,000 for maintenance and cure, and
* approximately $114,000 for medical expenses.
In this case, access to Valaris's insurance coverage requires
satisfaction by Valaris of a large self-insured retention ("SIR")
payment. The SIR requires Valaris to cover both defense and
liability payments before insurance coverage is invoked. A policy
subject to an unexhausted SIR does not fall into the insurer
exception
The insurance policy requires Valaris to contribute up to $10
million for each occurrence, subject to an aggregate SIR of $20
million. A claim from one occurrence must exceed $10 million to be
counted towards the aggregate SIR.
Valaris must incur another $9.4 million to meet the SIR requirement
for Bardwell's claim.
In addition to the unexhausted SIR for Bardwell's claim, the $20
million aggregate SIR has not been exhausted. There were 53 claims
made on the policy applicable to Bardwell's injury. None of the
claims reached the $10 million per occurrence threshold to account
towards the aggregate SIR. Not only must Valaris incur $9.4 million
in personal liability for Bardwell's claim, but it also must incur
an additional $20 million in aggregate claims before the policy
covers any amount of Bardwell's claim.
Therefore, granting Bardwell relief from discharge to pursue his
claim against Valaris would run counter to the purpose of the
insurer exception, the Court finds.
Bankruptcy Notices
Bardwell asserts that he did not receive adequate notices of the
bankruptcy case.
On Nov. 15, 2024, the Court held an evidentiary hearing on whether
Bardwell received adequate notice of Valaris' bankruptcy case.
The evidentiary hearing established that Bardwell cannot seek
relief from the plan discharge and injunction because the insurer
exception does not apply. The Court finds Bardwell received
adequate notices of the bankruptcy case to bind him to the plan.
Bardwell's in personam claims are discharged and he is prohibited
from further pursuit of the discharged claims.
A copy of the Court's decision is available at
https://urlcurt.com/u?l=et2cIj from PacerMonitor.com.
About Valaris PLC
Valaris plc (NYSE: VAL) provides offshore-drilling services. It is
an English limited company with its corporate headquarters located
at 110 Cannon St., London. On the Web: http://www.valaris.com/
On Aug. 19, 2020, Valaris and its affiliates sought
Chapter 11 protection (Bankr. S.D. Tex. Lead Case No. 20-34114).
The Debtors had total assets of $13,038,900,000 and total
liabilities of $7,853,500,000 as of June 30, 2020.
The Debtors tapped Kirkland & Ellis LLP and Slaughter and May as
their bankruptcy counsel, Lazard as investment banker, and Alvarez
& Marsal North America LLC as their restructuring advisor. Stretto
is the claims agent, maintaining the page
http://cases.stretto.com/Valaris
Kramer Levin Naftalis & Frankel LLP and Akin Gump Strauss Hauer &
Feld LLP serve as legal advisors to the consenting noteholders
while Houlihan Lokey Inc. serves as their financial advisor.
VISTRA ZERO: Fitch Affirms 'BB' Rating on 2031 Secured Term Loan B
------------------------------------------------------------------
Fitch Ratings has affirmed the rating of Vistra Zero Operating
Company, LLC's (Vistra Zero) senior secured term loan B due in 2031
at 'BB' with a Recovery Rating of 'RR2'. Vistra Zero is an indirect
subsidiary of Vistra Corp. (Vistra; BB/Stable). The term loan B is
non-recourse to Vistra. Vistra's ratings are not impacted by this
action.
Fitch expects credit metrics will be pressured in the near term due
to the loss of Moss 300 battery storage asset following the recent
fire. The rating affirmation reflects Fitch's view that Vistra is
committed to support Vistra Zero's liquidity needs, including debt
servicing. The rating is also driven by the expectation of a
material loss recovery in terms of insurance proceeds, offering an
option to Vistra Zero to replace Moss 300 with another asset or pay
down debt. Any indication of Vistra's diminished financial support
to Vistra Zero could lead to a negative rating action.
Key Rating Drivers
Vistra to Support Near Term Liquidity Needs: Vistra Zero has
available cash on hand that should support near-term liquidity
needs related to any clean up and business interruption until the
insurance proceeds are received. In addition, Fitch's base case
assumes Vistra will provide any additional liquidity needed,
including servicing the term loan and paying a termination fee with
its main offtaker PG&E Corp. (PG&E; BB+/Positive) if there is one.
The fire event does not constitute an event of default under the
credit agreement and there are no financial nor maintenance
covenants.
Fitch assumes near-term remaining free cash flow will remain at
Vistra Zero to support liquidity. Dividend distributions to Vistra
are allowed as long as FFO coverage ratio remains above 1.75x. Any
liquidity requirements, such as letter of credit postings, will be
provided by Vistra under an energy management services agreement.
Maintenance capex needs are also very modest over the forecast
period.
Insurance Proceeds Expect to Cover the Loss: Fitch expects Vistra
Zero should be able to cover most of the loss of its Moss 300
facility through existing insurance that covers both property
damage and business interruption after an initial deductible.
Vistra has a separate coverage for Moss 400 Program, with an
aggregate deductible of $20 million with a 60-day waiting period
for business interruption and total coverage of $500 million.
Fitch's base case assumes that insurance proceeds will be used to
fund a new investment that will be included in Vistra Zero and able
to replace most of the lost cash flow from Moss 300. In case Vistra
Zero chooses not to invest into a new asset, it would be required
to use insurance proceeds to pay down outstanding Term Loan. In
addition, Vistra carries third party liability insurance that Fitch
assumes would be able to cover for any third-party property damage
including accidental pollution.
Near Term Increased Leverage and Lower Coverage: Vistra Zero's
leverage and coverage projected to be under pressure near term due
to the absence of cash flows from Moss 300 and higher operational
costs related to the fire incident, including temporary loss of
cash flow from Moss 350 that is currently off-line. Fitch's base
case assumes the leverage to improve and remain below its negative
sensitivity threshold following receipt of insurance proceeds and
addition of a new asset that should replace most of Moss 300 lost
cashflow and provide sufficient interest coverage to support
current ratings.
Fire Destroys Moss 300: On Jan. 16, 2025 a large fire erupted at
Moss 300, a battery storage facility in California. The fire was
extinguished after several days. Based on preliminary information
the facility is permanently damaged and not expected to come back
online. Other adjacent battery storage facilities, Moss 100 and
Moss 350, and a gas plant were all taken offline although no damage
was reported at those; they remain offline. At this point the root
cause of the fire is not known. The company is starting the
inspection of the site this week as well as continuing
environmental testing.
Highly Concentrated Portfolio: Vistra Zero's portfolio is highly
concentrated compared to other generators, as around 80% of EBITDA
was projected to come from its Moss 400 (Moss 300+Moss 100) and
Moss 350 battery storage systems. Based on the current expectation
that Moss 300 plant is no longer operational portfolio
concentration is further increased with more than 50% of EBITDA
coming from Moss 350. The permanent damage of one of its largest
battery storage facilities and a loss of more than 33% of EBITDA,
underscores the credit concern stemming from highly concentrated
portfolio.
Long-term Contracted Cashflows: Remaining Vistra Zero's portfolio
is expected to produce predictable cashflows underpinned by
long-term contracts, a credit positive. Contract offtakers are
Pacific Gas and Electric Company (PG&E; BB+/Positive) and Vistra,
both creditworthy counterparties, each accounting for about 50% of
EBITDA. Vistra Zero's long-term contracts are either power purchase
agreements (PPAs) for the solar projects and tolling/resources
adequacy agreements for the storage projects. Vistra Zero does not
have material commodity risk exposure.
Past Operational Issues: Moss 400 went in service in 2021, but has
had incidents related to its water-based heat suppression system
that inadvertently disbursed water on the batteries impacting
operations in 2021 and 2022, emphasizing disproportioned portfolio
exposure to operations related event risk. Those incidents have
been resolved and the project has been operating with an average
availability factor of more than 90% since mid-2022 until recent
fire.
Derivation Summary
Vistra Zero's closest peers in Fitch's coverage universe are
Leeward Renewable Energy Operations, LLC's (LREO; BB-/Stable) and
Pattern Energy Operations LP's (PEO; BB-/Stable), which both own a
portfolio of renewable wind assets. LREO's operating scale in terms
of generation capacity of around 2.5 GW across 24 assets, and 3.6
GWs (proportionate capacity) at PEO compare favorably versus Vistra
Zero's smaller scale at 1.4 GW with concentration in battery
storage assets. In addition, LREO's and PEO's distributions,
although concentrated, are more diversified than Vistra Zero's.
LREO's five projects contributed close to 60% of distributions,
while PEO is more concentrated with 40% contribution coming from
one project. Compared to Vistra Zero where more than 50% of EBITDA
contribution is expected from one project following the fire at
Moss 300. LREO's and PEO's remaining contract life is lower at
eight years and 11 years, respectively, versus Vistra Zero's at 17
years.
Fitch rates LREO and PEO on a deconsolidated basis because their
portfolios comprise assets financed using non-recourse project debt
or with tax equity. Fitch forecasts LREO's holdco FFO only leverage
at around 3.5x over the forecast period and PEO's in the low 4.0x
range by the end of 2025, versus Vistra Zero's where EBITDA
leverage is forecasted to be under pressure near-term.
Key Assumptions
- EBITDA projections reflect PPAs, Tolling and Resource Adequacy
long-term contracts in place at the projects;
- Insurance proceeds received for Moss 300 fire and used for a new
investment;
- Any potential third-party liabilities in excess of the deductible
covered by the existing third-party liability insurance;
- No additional debt issuance over the forecast period;
- Allocation of corporate overhead costs from Vistra;
- Solar generation volumes at P50;
- Operating costs increasing with inflation;
- Any termination fee related to PG&E contract or other liquidity
needs paid from cash on hand and/or Vistra's financial support.
Recovery Analysis
The term-loan rating at Vistra Zero is notched in relationship to
Vistra Zero's implied Issuer Default Rating as a result of the
relative recovery prospects in a hypothetical default scenario. The
Recovery Rating 2 (RR2) for Vistra Zero's term loan B is based on a
scenario where Vistra stops providing liquidity support to Vistra
Zero due to a large termination fee payment to PG&E related to the
Resource Adequacy contract with Moss 300. Vistra Zero is therefore
not able to service the loan and files for bankruptcy.
Fitch values the remaining solar and battery storage generation
assets that guarantee the debt using a net present value (NPV)
analysis. For the NPV of generation assets used in Fitch's recovery
analysis, Fitch uses the plant valuation provided by its
third-party power market consultant, Wood Mackenzie, as well as
Fitch's own assumptions. The NPV analysis for generation portfolio
yields approximately an average of $600/kW for the remaining
battery and $200/kW for solar assets and materially lower insurance
proceeds.
Using this going concern NPV and a 10% administrative claim in the
recovery calculation as specified in Fitch's Corporates Notching
and Recovery Ratings Criteria, the agency determines the term
loan's recovery rating to be 'RR2'. This indicates superior
recovery prospects (in the range of 71%-90%).
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
- Underperformance in the underlying assets that lends material
variability or shortfall to expected cash flow;
- Lack of liquidity support from Vistra for any termination
payment/cleanup costs;
- Insurance proceeds materially lower than projected level;
- EBITDA leverage above 6.0x on a sustained basis.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
- A material increase in fuel and geographic diversification at
Vistra Zero;
- Established track record of stable EBITDA generation;
- EBITDA leverage lower than 5.0x on a sustained basis.
Liquidity and Debt Structure
Any regular liquidity requirements at Vistra Zero, such as letter
of credit postings, will be provided by Vistra under its Energy
Management Services Agreement. Vistra Zero should generate enough
cash to support its modest capex needs and Fitch's base case
assumes any additional liquidity needs following recent fire
incident will be provide by Vistra. Vistra Zero's only debt is a
$697 million term loan B due in 2031 with no amortization
requirement. The debt is non-recourse to Vistra and is secured by
Vistra Zero's assets.
Issuer Profile
Vistra Zero Operating Company is an indirect subsidiary of Vistra
Corp. holding a 1.4 GW portfolio of six operating solar generation
and energy storage assets in California and Texas.
MACROECONOMIC ASSUMPTIONS AND SECTOR FORECASTS
Fitch's latest quarterly Global Corporates Macro and Sector
Forecasts data file which aggregates key data points used in its
credit analysis. Fitch's macroeconomic forecasts, commodity price
assumptions, default rate forecasts, sector key performance
indicators and sector-level forecasts are among the data items
included.
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
----------- ------ -------- -----
Vistra Zero Operating
Company, LLC
senior secured LT BB Affirmed RR2 BB
VOIP-PAL.COM: Increases Authorized Common Shares to 9 Billion
-------------------------------------------------------------
VoIP-Pal.Com Inc. disclosed in a Form 8-K Report filed with the
U.S. Securities and Exchange Commission that the board of directors
approved an increase in the Company's authorized capital from
8,000,000,000 shares of common stock, par value $0.001 per share,
to 9,000,000,000 shares of common stock, par value $0.001 per
share, which action was subsequently approved by the holders of a
majority of the Company's issued and outstanding stock on January
30, 2025.
The Common Stock Increase follows the Board's prior approval of an
increase in the Company's authorized capital from 1,000,000 shares
of preferred stock, par value $0.01 per share, to 2,000,000 shares
of Preferred Stock, which action was approved by the holders of a
majority of the Company's issued and outstanding stock on October
9, 2024 and re-approved on January 30, 2025.
Pursuant to applicable securities laws, the Company does not plan
to effect either the Common Stock Increase or the Preferred Stock
Increase until at least 20 days after a definitive information
statement on Schedule 14C has been transmitted to the Company's
stockholders who did not previously consent to either of the
Authorized Capital Increases.
Following the completion of the Preferred Stock Increase, the
Company plans to file an amendment to a certificate of designation
dated May 25, 2022, as previously amended on March 6, 2023 and
October 8, 2024, with the Nevada Secretary of State in order to
designate an additional 500,000 shares of the Preferred Stock as
Series A preferred stock, thereby increasing the total number of
shares of Preferred Stock designated as Series A Stock from
1,000,000 to 1,500,000.
The Series A Stock has the voting powers, designations,
preferences, limitations, restrictions and relative rights set
forth in the original Certificate of Designation, a copy of which
was filed as Exhibit 3.3 to the Company's current report on Form
8-K dated May 27, 2022.
The material features of the Series A Stock are as follows:
1. Holders of Series A Stock are entitled to 1,550 votes per
share of Series A Stock on any matter submitted to a vote of the
Company's stockholders, and are generally entitled to vote together
as one class with holders of the Company's common stock;
2. Holders of Series A Stock are not entitled to receive any
dividends or other distributions in respect of any shares of Series
A Stock held by them;
3. Holders of Series A Stock are not entitled to receive any
assets of the Company upon a liquidation, dissolution or winding up
of the Company;
4. Shares of Series A Stock are not redeemable;
5. Shares of Series A Stock are not convertible or
exchangeable into shares of the Company's common stock; and
6. Shares of Series A Stock are not transferrable or
assignable without the prior written consent of the Company.
As of February 4, 2025, all 1,000,000 authorized shares of the
Preferred Stock have been designated as Series A Stock, with the
result that Nil shares of the Preferred Stock remain authorized and
eligible for designation by the Board pursuant to the Company's
articles of incorporation, as amended.
About VoIP-PAL.com Inc.
Since March 2004, VoIP-PAL.com Inc. has been in the development
stage of becoming a Voice-over-Internet Protocol ("VoIP")
re-seller, a provider of a proprietary transactional billing
platform tailored to the points and air mile business, and a
provider of anti-virus applications for smartphones. All business
activities prior to March 2004 have been abandoned and written off
to deficit.
Vancouver, Canada-based Davidson & Company LLP, the Company's
auditor since 2015, issued a "going concern" qualification in its
report dated Dec. 23, 2024, citing that the Company is in various
stages of product development and continues to incur losses and, as
at September 30, 2024, had an accumulated deficit of $103,357,782
(September 30, 2023 - $93,185,588). These material uncertainties
raise substantial doubt about its ability to continue as a going
concern.
As of Sept. 30, 2024, VoIP-PAL.COM had $2.46 million in total
assets, $300,782 in total liabilities, and $2.16 million in total
stockholders' equity.
WANDERLY LLC: Files Emergency Bid to Use Cash Collateral
--------------------------------------------------------
Wanderly, LLC asked the U.S. Bankruptcy Court for the Southern
District of Florida, West Palm Beach Division, for authority to use
the cash collateral of Advance Partners and People 2.0 Global,
Inc.
The company needs to use cash collateral to pay regular operating
expenses in the regular course of business, as well as the
administrative expenses in its Chapter 11 proceedings as they
become due.
Advance may have a lien on the cash collateral by virtue of a UCC-1
financing statement filed on July 26, 2024, in the Delaware Secured
Transaction Registry. The arrangement with Advance involves
factoring receivables for the company's Flexup Direct accounts but
the financing statement purports to assert a security interest in
all assets of the company.
People 2.0 may have a lien on the cash collateral by virtue of a
UCC-1 financing statement filed on June 29, 2020, in the Delaware
Secured Transaction Registry. The secured collateral purports to be
all accounts receivables of Orion Healthcare Services, Inc. Orion
is the predecessor and current owner of Wanderly.
In February 2023, Orion entered into a business arrangement with
WHL Investment whereby Orion's healthcare staffing business was
assigned to Wanderly and Orion and WHL Investment established
percentage ownership interests in the company. Despite having
knowledge of this assignment of its business arrangements to the
company and having done business with the company for a substantial
period of time, People 2.0 did not update its financing statement
and has not filed a financing statement naming the company as
secured debtor.
As adequate protection, Wanderly will grant a replacement lien to
Advance and People 2.0 to the same extent as any pre-bankruptcy
lien, if any, on and in all property set forth in the respective
security agreements and related lien documents.
A court hearing is set for Feb. 26.
About Wanderly LLC
Wanderly, LLC is a technology marketplace platform created for
traveling healthcare professionals and healthcare staffing
companies.
Wanderly filed Chapter 11 petition (Bankr. S.D. Fla. Case No.
24-23477) on December 26, 2024, listing between $100,000 and
$500,000 in assets and between $1 million and $10 million in
liabilities. Linda Leali, Esq., serves as Subchapter V trustee.
Judge Erik P. Kimball handles the case.
The Debtor is represented by Craig I. Kelley, Esq., at Kelley
Kaplan & Eller, PLLC.
WELCOME GROUP: Seeks Cash Collateral Access Until June 15
---------------------------------------------------------
Welcome Group 2, LLC and affiliates asked the U.S. Bankruptcy Court
for the Southern District of Ohio, Eastern Division at Columbus,
for authority to use cash collateral until June 15.
The companies need to use cash collateral to fund necessary
business expenses and to fund the costs associated with the
administration of their Chapter 11 cases.
Adequate protection is provided to RSS WFCM2019-C50 – OH WG2, LLC
by the companies by using cash collateral only in accordance with
the revised budget and by making payments to the secured lender.
Adequate protection is also provided by the re-granting of the
pre-bankruptcy security interests to the lender.
About Welcome Group 2
Welcome Group 2, LLC owns and operates the Super 8 located at 2440
National Road, Zanesville, Ohio.
Welcome Group 2 filed Chapter 11 petition (Bankr. S.D. Ohio Case
No. 23--53043) on September 1, 2023, listing up to $10 million in
both assets and liabilities. Abhijit Vasani, sole member, signed
the petition.
Judge Mina Nami Khorrami oversees the case.
Denis E. Blasius, Esq., at Thomsen Law Group, LLC, represents the
Debtor as bankruptcy counsel.
WESTLAKE SURGICAL: No Decline in Patient Care, 10th PCO Report Says
-------------------------------------------------------------------
Dr. Thomas Mackey, the court-appointed patient care ombudsman,
filed with the U.S. Bankruptcy Court for the Western District of
Texas his 10th report regarding the quality and safety of patient
care provided at The Hospital at Westlake Medical Center, a
boutique hospital in Westlake Hills operated by Westlake Surgical,
L.P.
The PCO visited Westlake's facility and spoke with the Chief
Administrative Officer (CAO), Director of Nursing (DON), Director
of Quality Compliance and Risk (DQCR), Director of Pharmacy (DOP),
Director of Laboratory Services (DOL), registered nurses on the
medical floor and operating rooms.
Westlake provided cooperation and was candid with responses to
inquiries by the PCO. Staff were open and forthcoming with
requested information. Staff do not believe the Chapter 11
proceedings have compromised patient quality or safety of care.
Staff do not feel patient care is suffering because of the Chapter
11 process.
The following is a summary of the PCO's visit on February 4:
* The leadership team (specifically, the DON, CAO and DQCR)
and general staff remain stable allowing processes and
organizational structures to address the safety and quality of care
within the hospital.
* Press Ganey quality scores in the patient service area are
in the 90th 41 percentile indicating Westlake is focusing on safety
and quality of care measures in a proactive fashion.
* The Director of Nursing and Infection Control nurses are
aggressive, diligent and pro-active with actions to assure patient
safety throughout the hospital (operating rooms, patient floors,
kitchen, maintenance, housekeeping, etc.).
* The PCO believes quality and safety of patient care
continues to be provided at a superior level than when Chapter 11
was filed. Leadership has created a culture of patient safety and
quality of care.
* Westlake continues to employ appropriate administrative and
clinical staff (physicians, nurses, pharmacists, technicians, etc.)
for the number of patients serviced in the emergency department and
hospital.
* Westlake has addressed all previously mentioned quality and
safety issues to the satisfaction of the PCO.
A copy of the ombudsman report is available for free at
https://urlcurt.com/u?l=qotUgR from PacerMonitor.com.
About Westlake Surgical
Westlake Surgical, L.P. operates The Hospital at Westlake Medical
Center, a boutique hospital in Westlake Hills, Texas. Its core
service areas include surgical procedures, outpatient radiology and
a 24/7 emergency room.
Westlake Surgical filed Chapter 11 petition (Bankr. W.D. Texas Case
No. 23-10747) on Sept. 8, 2023, with $10 million to $50 million in
both assets and liabilities. Judge Shad Robinson oversees the
case.
The Debtor tapped Hayward, PLLC as legal counsel and Donlin, Recano
& Company, Inc. as claims agent. eCapital Healthcare Corp., the
debtor-in-possession (DIP) lender, is represented by Foley &
Lardner, LLP.
On Sept. 29, 2023, the U.S. Trustee for Region 7 appointed an
official committee to represent unsecured creditors in the Debtor's
Chapter 11 case. The committee is represented by White & Case,
LLP.
Dr. Thomas Mackey is the patient care ombudsman appointed in the
Debtor's case.
WHITE FOREST: Files Chapter 11 Bankruptcy w/ $79MM Debt, Sale Plans
-------------------------------------------------------------------
Rick Archer of Law360 reports that White Forest Resources, a West
Virginia coal miner, has filed for Chapter 11 bankruptcy in
Delaware, citing nearly $79 million in debt.
Struggling with production and shipping issues, the company intends
to sell one of its two mines by April 2025, the report states.
About White Forest Resources Inc.
White Forest Resources Inc. and affiliates are privately-held
producers of premium metallurgical and thermal coal in the Central
Appalachian coal basin. The Debtors operate two mining operations
in West Virginia. The main buyers of the Debtors' premium
metallurgical coal, which is used in a process to produce coke for
steel manufacturing, include steel manufacturers, commodity
brokers, and industrial clients. Electric utilities and industrial
companies are the principal customers for the Debtors' thermal
coal.
White Forest Resources Inc. and affiliates sought relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case
No. 25-10195) on February 7, 2025. In its petition, the Debtor
reports estimated assets up to $50,000 and estimated liabilities
between $10 million and $50 million.
Honorable Bankruptcy Judge Thomas M. Horan handles the case.
The Debtor is represented by Alan M. Root, Esq., William E.
Chipman, Jr., Esq., and Alison R. Maser, Esq., at CHIPMAN BROWN
CICERO & COLE, LLP, in Wilmington, Delaware.
The Debtors' CRO Provider is RK CONSULTANTS LLC.
The Debtors' Special Counsel is JONES & ASSOCIATES.
The Debtors' Provider of Noticing, Claims Management and
Reconciliation, Plan Solicitation, Balloting & Disbursements
Services is Stretto.
ZANO INDUSTRIES: $20M Sale to TBE RE Acquisition to Fund Plan
-------------------------------------------------------------
Zano Industries, Inc. filed with the U.S. Bankruptcy Court for the
Eastern District of New York a Chapter 11 Plan dated February 3,
2025.
The goal of the Chapter 11 case is to pursue a robust sale process
while recognizing the Asset Purchase Agreement ("APA") with TBE RE
Acquisition CO II LLC (the "Purchaser") who is the Stalking Horse
bidder at a purchaser price of $20,000,000 (the "Purchase Price").
Regardless of the outcome of the Auction sale, the Purchase Price
of the APA will provide sufficient funds to satisfy administrative
expenses all classifications of creditors in full.
Class 2 consists of Unsecured Claims. The Debtor is classifying all
other claims against the Debtor or the Property as being fully
unsecured with the final allowed amounts thereof subject to final
review and reconciliation by the CRO and order of the Bankruptcy
Court. All Allowed Claims of Unsecured Creditors will be paid in
full from the Proceeds of the Sale on the Effective Date. The Class
2 Claims of Allowed General Unsecured Creditors are unimpaired and
are therefore ineligible to vote on the Plan.
Class 3 consists of the Equity Interests in the Debtor. Any
proceeds after payment of Administrative Claims, claims of the Tas
Lienholders, Unsecured Creditors and any income taxes due, shall be
paid to the equity interests.
The Plan shall be implemented and funded through the sale of the
Property in accordance with the Auction sale process conducted
pursuant to the terms of the Approved Bid Procedures. The results
of the Auction, shall be confirmed at the Confirmation Hearing and
incorporated as part of the Plan and Confirmation Order.
The Sale Proceeds realized from the sale of the Property to an
acceptable bona fide third-party buyer shall be distributed in
conjunction with other Available Cash to the holders of Allowed
Claims and Interests in the following order:
* First, to holders of Allowed Administrative Expense Claims
as budgeted pursuant to the Cash Collateral Order subject to the
agreed caps (but excluding, for avoidance of doubt, any
Administrative Expense Claims consisting of any personal injury
tort, commercial tort, or otherwise) and allowed Priority Tax
Claims.
* Second, to the Tax Lienholders up to the amount of its
Allowed Secured Claim.
* Third, to Class 2 unsecured creditors from either the Sale
Proceeds in the amount of their Allowed Claim.
* Fourth, to Equity interests in the amount of funds remaining
after payment and reserve for all Allowed Claims.
A full-text copy of the Chapter 11 Plan dated February 3, 2025 is
available at https://urlcurt.com/u?l=FK8jQL from PacerMonitor.com
at no charge.
Counsel to the Debtor:
Ronald Terenzi, Esq.
Cara M. Goldstein, Esq.
Terenzi & Confusione, P.C.
401 Franklin Avenue
Garden City, NY 11530
Telephone: (516) 812-4502
Email: rterenzi@tcpclaw.com
About Zano Industries
Zano Industries, Inc., filed its voluntary petition for protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D.N.Y. Case
No. 24-43903) on Sept. 19, 2024. In the petition signed by
Ferdinand Provenzano, president, the Debtor disclosed up to $50
million in assets and up to $10 million in liabilities.
Judge Nancy Hershey Lord oversees the case.
The Debtor tapped Ronald Terenzi, Esq., at Terenzi & Confusione, PC
as bankruptcy counsel; Kevin Nash, Esq., at Goldberg Weprin Finkel
Goldstein LLP as special real estate counsel; and GS & CO as
accountant.
ZANO INDUSTRIES: Cohen Weiss Represents Creditors
-------------------------------------------------
Michael S. Adler, Hanan B. Kolko, and Matthew E. Stolz, attorneys
at Cohen, Weiss and Simon LLP ("CWS"), filed a verified statement
pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure
to disclose that in the Chapter 11 case of Zano Industries, Inc.,
the firm represents:
1. Building Material Teamsters, Local 282 IBT ("Local 282")
2500 Marcus Ave
Lake Success, NY 11042
2. The Trustees of the Local 282 Welfare Trust Fund, Local 282
Pension Fund, Local 282 Annuity Trust
Fund, Local 282 Job Training Trust Fund, and Local 282 Vacation
and Sick Leave Trust Fund (the "Local
282 Trust Funds")
2500 Marcus Ave
Lake Success, NY 11042
Local 282 and the Local 282 Trust Funds have claims against the
Debtor. These claims arise from Debtor's obligations arising under
a collective bargaining agreement ("CBA") between Local 282 and the
Debtor.
The CBA sets out the terms and conditions of employment for the
Debtor's former employees represented by Local 282 (the
"Employees") and obligates the Debtor to make contributions to the
Local 282 Trust Funds for health, pension, vacation and sick leave,
and other benefits for the Employees. The claims arose both before
and during the one-year period prior to the filing of the case.
CWS have previously worked with Local 282 and the Local 282 Funds
on numerous matters. In this matter, CWS was engaged by Local 282
and the Local 282 Funds in September 2024 at the instance of each
entity. CWS has no claims or interests against the Debtor.
The law firm can be reached at:
Michael S. Adler, Esq.
Hanan B. Kolko, Esq.
Matthew E. Stolz, Esq.
COHEN, WEISS AND SIMON LLP
900 Third Avenue, Suite 2100
New York, New York 10022-4869
Telephone: (212) 563-4100
Facsimile: (212) 563-6527
Email: madler@cwsny.com
hkolko@cwsny.com
mstolz@cwsny.com
About Zano Industries
Zano Industries, Inc., filed its voluntary petition for protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. E.D.N.Y. Case
No. 24-43903) on Sept. 19, 2024. In the petition signed by
Ferdinand Provenzano, president, the Debtor disclosed up to $50
million in assets and up to $10 million in liabilities.
Judge Nancy Hershey Lord oversees the case.
The Debtor tapped Ronald Terenzi, Esq., at Terenzi & Confusione, PC
as bankruptcy counsel; Kevin Nash, Esq., at Goldberg Weprin Finkel
Goldstein LLP as special real estate counsel; and GS & CO as
accountant.
ZARIFIAN ENTERPRISES: Court OKs Carpentry Equipment Sale at Auction
-------------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division has granted Zarifian Enterprises LLC, to sell
carpentry equipment, machinery and tools.
The Debtor operates a carpentry and millwork business and owns
various wood working machinery and equipment used in the operations
of the business including but not limited to the following: Holz
Her CNC Machine, Holz Her Edge Bander, Gannomat machines, including
drill and dowel machines, Pedestal Packaging Wrapper, Rol Air Air
Compressor, and Dewalt tools, known as Equipment.
The Debtor is authorized to sell equipment, machinery and tools, at
an on-line auction conducted by Heath Industrial, pursuant to the
terms and conditions of the On-Line Auction, free and clear of all
liens, claims and encumbrances with all liens, claims and
encumbrances to attach to the proceeds of sale from the auction.
The Debtor is ordered to pay Heath Industrial the sum of $6,500.00
for the reimbursement of expenses associated with the on-line
auction.
About Zarifian Enterprises, LLC
Zarifian Enterprises, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. D.P.R. Case No. 25-00188) on May 2, 2024.
Judge David D. Cleary presides over the case.
The Debtor was represented by Gregory K. Stern, P.C. as its legal
counsel.
[] Bankrupt Green Tech Startups Fuel Secondary-Market Bargains
--------------------------------------------------------------
Online auctions are featuring more assets from financially
distressed startups in areas like solar energy, "green" packaging,
experimental foods and electric vehicles and batteries, observed a
Tiger Group executive.
"Some of these operators simply run out of money. Others face
insufficient market demand or struggle to make good on promises of
ambitious solutions rooted in 'disruptive' tech," writes Chad
Farrell, Managing Director of Tiger Commercial & Industrial, in an
opinion column for ABL Advisor.
The sales are creating opportunities for others in the
sustainability space to acquire specialized equipment and IP at
liquidation discounts. More mainstream operators are finding rare
bargains on conventionally useful assets such as gas-processing
equipment, steel tanks, industrial robots and CNC milling machines,
Farrell notes.
Secondary-market demand for green startups' assets can be
significant. In the column, Farrell points to his division's $10
million auction of parts, tools, equipment and EVs formerly owned
by Loveland-Colorado-based Lightning eMotors. The bidder response
included 40,000 page views, 309 registrants and 3,371 bids for 644
lots.
In the piece, Farrell points to several other Tiger Group auctions
involving sustainability-focused operators, including:
-- A court-sanctioned Chapter 7 bankruptcy sale of assets from
Lemnature Aquafarms' $14 million production and R&D plants in
Florida. The regenerative agriculture company had tried to sell
plant-based ingredients--essentially, green protein from
waterlilies--to the food-and-beverage and healthy nutrition
markets.
-- A Chapter 7 sale of assets from green energy company Aqua
Hydrex, which had aimed to extract hydrogen from water using
electrolysis as a way to help decarbonize industrial operations,
transportation and agriculture.
-- The turnkey sale of Romeo Power's 215,000-square-foot EV battery
assembly plant in California to Mullen Automotive.
-- The auction of assets and IP from "grid-edge" tech startup
Veloce Energy, which had created a deployment and operation
platform for EV charging stations, commercial solar arrays and
industrial storage facilities
In the latter sale, "some bidders vied for the company's battery
energy storage systems; others went after conventional tools,
parts, welders, forklifts, transformers, inverters, oscilloscopes
and test equipment," Farrell observes.
But he cautions that when operators have an unprecedented,
moonshot-type process, it can be challenging to sell their
proprietary, highly specialized machinery and equipment (M&E) and
inventory.
"In recent liquidations, such equipment has accounted for 20 to 30
percent of the assets on offer," Farrell notes. "All of that said,
the sustainability space is full of newer companies with test
modules, laser welders, CNC machines and industrial robots that are
in excellent condition, or even still in the box, with tremendous
resale value."
Farrell concludes the piece by encouraging lenders and disposition
firms to focus on the green sector. "They already fully grasp the
potential recoveries associated with the universal M&E described
above," he writes. "Moving forward, they can continue to build
their expertise and buyer relationships with respect to highly
specialized assets as well."
Pointing to Tiger Group's upcoming liquidation of assets from
Northvolt Ett Expansion AB, Farrell noted that the trend has
continued into 2025. "We're currently accepting offers on $82
million of unused EV battery manufacturing equipment in Belgium and
South Korea," he said. "These assets are from several brands and
are still in their original crates and boxes."
The full article is available at:
https://www.abladvisor.com/articles/39992/distress-leads-to-more-auctions-of-green-machinery-equipment
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
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public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
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equity securities trade in public market are determined by more
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On Thursdays, the TCR delivers a list of recently filed
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liabilities delivered to nation's bankruptcy courts. The list
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Each Friday's edition of the TCR includes a review about a book of
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The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
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*********
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