/raid1/www/Hosts/bankrupt/TCR_Public/170123.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, January 23, 2017, Vol. 21, No. 22
Headlines
271 SEA BREEZE: Case Summary & Unsecured Creditor
611 COMMERCIAL: May Convert to Ch. 7 if Sale Not Completed in 1 Yr
7470 COMMERCIAL: U.S. Trustee Unable to Appoint Committee
97-111 HALE: Sale of White Plains Property to Hale for $8M Denied
A.M. PRECISION: Taps Jeffrey Strange and Associates as Counsel
ACELITY LP: Moody's Assigns B1 Rating to New 1st Lien Debt
ADS TACTICAL: Moody's Withdraws B2 CFR After Debt Refinancing
ADVANCED MICRO DEVICES: BlackRock Reports 8.8% Stake as of Dec. 31
AIRXCEL INC: S&P Assigns 'B' CCR & Rates $300MM Sr. Notes 'B'
ALLIANT HOLDINGS: S&P Retains 'B' CCR on Refinancing & Repricing
AMERICAN CHARTER: Fitch Withdraws BB Rating on Series 2007A Bonds
AMERICAN POWER: Incurs $10.4 Million Net Loss in Fiscal 2016
ARTFUL COLOR: Case Summary & 20 Largest Unsecured Creditors
ATOP TECH: Jan. 27 Meeting Set to Form Creditors' Panel
ATOPTECH INC: Draper Athena Buying All Assets for $8 Million
AUTHENTIDATE HOLDING: CEO Holds 11.7% Equity Stake as of Dec. 19
AUTHENTIDATE HOLDING: Director Quits Over 'Lack of Transparency'
AVAYA INC: Case Summary & 50 Largest Unsecured Creditors
AVAYA INC: Files for Chapter 11 Bankruptcy Protection
AVAYA INC: Files for Chapter 11, Has $725MM DIP Loan from Citibank
AVAYA INC: Foreign Units Obtain Forbearance from Citi, Lenders
AVAYA INC: Reports Q4 and Fiscal Year 2016 Financial Results
AVAYA INC: S&P Lowers CCR to 'D' on Voluntary Ch. 11 Petition
AVERY LAND: Plan Filing Period Extended Through March 23
AZTUC LLC: Seeks to Hire Eric Ollason as Legal Counsel
AZURE MIDSTREAM: Waiver Pact Requires Sale of Assets by Jan. 30
BAKERSFIELD TEMPLE: Taps Klein DeNatale as Legal Counsel
BARTELLO PROPERTIES: U.S. Trustee Unable to Appoint Committee
BEEKMAN LIQUORS: Sale of All Assets to Kwon for $325,000 Approved
BELK INC: Bank Debt Trades at 15% Off
BENEVOLENT HOSPICE: Taps Hervol Law as Counsel
BENNU TITAN: Ch.11 Trustee Wants Parent's Cases Moved to Del.
BILL BARRETT: JPMorgan Chase Reports 6.4% Stake as of Dec. 30
BJORNER ENTERPRISES: Unsecureds to be Paid in Full in One Year
BONANZA CREEK: Gets 'Unsolicited' Inquiry From Bill Barrett
BUMI RESOURCES: Seeks Ch.15 Recognition of Indonesian Case
CABLE ONE: Moody's Affirms Ba3 CFR & Lowers Notes Rating to B2
CARTER REESE: Selling Sinking Spring Parcels for $960K
CENTRAL AMERICA BOTTLING: S&P Affirms BB CCR; Outlook Still Stable
CENTRAL AMERICAN BOTTLING: Moody's Rates $575MM Unsec. Notes Ba2
CS MINING: Has Final OK on $2.65-Mil. Tailings DIP Loan, Cash Use
DASEKE INC: S&P Assigns 'B+' CCR & Rates $250MM Loan 'BB-'
DAWSON INTERNATIONAL: Needs Until May 23 to File Chapter 11 Plan
DBDFW2 LLC: Hires Turnkey Properties as Manager
DERRY COAL: U.S. Trustee Unable to Appoint Committee
DIAMOND SHINE: Unsecured Creditors to be Paid 4.3% Over 5 Years
DICKIE POH: Sale of Real and Personal Property Approved
DVR LLC: Ch.11 Trustee Taps Scott Land as Real Estate Broker
ECI HOLDCO: S&P Retains 'B' Rating Following Loan Upsize
EDWARD JACOBY: Selling Residential Property in Galva
ENERGAS RESOURCES: Acquires Energy and Environmental Services
ENERGY FUTURE: Cancels Registration of Securities
FAHEY EXTERIORS: U.S. Trustee Unable to Appoint Committee
FOGGIA REAL: Cash Collateral Hearing Scheduled for Feb. 9
FOUR SEASONS: Case Summary & 20 Largest Unsecured Creditors
FRAC TECH: Bank Debt Trades at 14% Off
FUNCTION(X) INC: Appoints Rant Co-Founder Chief Operating Officer
FUNCTION(X) INC: Borrows Additional $250,000 from Sillerman
FUNCTION(X) INC: In Default Under $4.4 Million Conv. Debentures
GEK REALTY: Voluntary Chapter 11 Case Summary
GENE CHARLES: Taps Bowles Rice as Lead Counsel
GREAT BASIN: Note Buyers OK Release of $1.25M Restricted Funds
GROVE PLAZA: Selling Ontario Properties for $8 Million
GYMBOREE CORP: Bank Debt Trades at 49% Off
HARVEST COMMUNITY: FDIC Named as Receiver; FCB Assumes Deposits
HEXION INC: Expects to Record Net Sales of $760 Million in Q4
HEXION INC: S&P Assigns 'CCC+' Rating on $460MM Sr. Sec. Notes
HILL-ROM HOLDINGS: S&P Affirms 'BB+' CCR on Planned Acquisition
HME HOLDINGS: Seeks April 27 Exclusive Plan Filing Extension
HOMER CITY: Can Use BNY Mellon Cash Collateral on Interim Basis
III EXPLORATION: Sale of North Dakota Assets for $7.5M Approved
IMMUCOR INC: Bank Debt Trades at 3% Off
IMPLANT SCIENCES: DMRJ, Montsant Dismiss Equity Panel's Claims
IMPLANT SCIENCES: Had Talks with Equity Panel on Standing Motion
IMPLANT SCIENCES: Hires Roberts as Chief Financial Officer
INDUSTRIAL RIDE: Seeks Authorization to Use Cash Collateral
INTOWN COMPANIES: Property Tax Claimholders to be Paid in 60 Months
J. CREW: Bank Debt Trades at 46% Off
KINETIC CONCEPTS: S&P Affirms 'B' CCR & Revises Outlook to Pos.
KOPH INC: Authorized to Use Cash Collateral Through Feb. 10
LA4EVER LLC: Can Continue Using Cash Collateral Until Jan. 31
LESLIE'S POOLMART: Buyout No Immediate Impact on Moody's Ratings
LIMITED STORES: Jan. 24 Meeting Set to Form Creditors' Panel
LIMITED STORES: Limited IP Buying Assets for $25.8 Million
LIVE OAK: Intends to Continued Using Cash Collateral Thru Feb. 28
LIVE OAK: Second Amended Chapter 11 Plan of Liquidation Filed
MARRONE BIO: Shareholder Suit Settlement Gets Preliminary OK
MATHIOPOULOS 3M: Allowed to Use Cash Collateral Until March 31
METCOM NETWORK: Intends to File Chapter 11 Plan by April 22
MRN HOMES: Seeks to Hire Will Geer as Legal Counsel
MUSCLEPHARM CORP: Amerop Holdings Reports 9% Stake as of Jan. 4
NAKED BRAND: Elects Messrs. Davis-Rice and Hanson as Directors
NAKED BRAND: Enters Into Letter of Intent to Merge with Bendon
NAKED BRAND: Has 8.15 Million Outstanding Common Shares
NAKED BRAND: Offering $1.9 Million Worth of Common Stock
NAVISTAR INTERNATIONAL: Closes Sale of $250M 8.25% Senior Notes
NEIMAN MARCUS: Bank Debt Trades at 15% Off
NEOVASC INC: To Seek Expedited Appeal of "CardiAQ" Suit Judgment
NEW YORK TIMES: S&P Affirms Then Withdraws 'BB-' CCR
NEXXLINX CORP: Unsecured Creditors to Get 27% Under Latest Plan
NORTHPORT BAY: Seeks Authorization to Use National Cash Collateral
OLMOS EQUIPMENT: Pres. to Contribute $50K to Pay Unsecured Claims
ONVOY LLC: Moody's Assigns B2 Corp. Family Rating
PARAGON OFFSHORE: MER Group Buying Paragon MSS2 for $219K
PARAGON POOLS: U.S. Trustee Unable to Appoint Committee
PARC ENGLAND: Proposes Auction of Closed Hotel and Restaurant
PEABODY ENERGY: Committee Agrees to Support Plan, Rights Offering
PEABODY ENERGY: Debtors, UCC Balk at Bid for Equity Panel
PEABODY ENERGY: Liberty Mutual Balks at Bid to Approve Exit Loans
PEABODY ENERGY: Mangrove's Equity Panel Bid Gains Support
PERFORMANCE SPORTS: Seeks OK of Pre-Closing Reorganization Deals
PRESIDENTIAL REALTY: Jeffrey Rogers Holds 5.4% of Class B Stock
PRESIDENTIAL REALTY: President Owns 8.7% of Class B Common Stock
PRESIDENTIAL REALTY: Richard Brandt Holds 5.6% of Class B Stock
PROFESSIONAL MEDICAL: Unsecureds to Get 100% at 3% in 120 Months
PROGRESSIVE CROP: U.S. Trustee Unable to Appoint Committee
PROWLER ACQUISITION: S&P Alters Outlook to Neg. & Affirms CCC+ CCR
QUINN'S JUNCTION: Intends to Continue Using Cash Thru April 30
RENNOVA HEALTH: Director's Death Triggers Nasdaq Noncompliance
RENT-A-CENTER INC: S&P Puts 'BB-' CCR on CreditWatch Negative
RO & SONS INC: Has Authorization to Use Cash Collateral
ROBERT JOHNSON: Kheshvadjian Buying 2011 Ford Flex for $9.4K
S DIAMOND STEEL: Hearing on Plan Outline Set for Feb. 28
S. J. MEDICAL: Santos Trust Buying San Jacinto Property for $5.4M
SAEXPLORATION HOLDINGS: Appoints Independent Director to Board
SAM BASS: Has Interim Authority to Use Cash Collateral Until Feb. 7
SAN JOSE CONTRACTING: Taps Campbell & Coombs as Legal Counsel
SANJECK LLP: Asks For Court's Conditional Approval of Plan Outline
SECURED ASSETS: Millennial Living Buying Reno Property for $338K
SILVER CREEK: Can Use DeSoto Cash Collateral on Interim Basis
SOLERA HOLDINGS: S&P Lowers CCR to 'B-' on High Leverage
SPANISH BROADCASTING: Begins Trading on OTCQX
SPECTRASCIENCE INC: Withdraws Tender Offer for Warrants
SPENCER TRANSPORTATION: CCG Inc Wants to Stop Cash Use
STENA AB: Bank Debt Trades at 8% Off
STRINGER FARMS: Can Continue Using Cash Collateral Until Feb. 10
SUNEDISON INC: Sale of 100% Interest in TerraForm for $42.5M Okayed
SUNPOWER BY RENEWABLE: U.S. Trustee Unable to Appoint Committee
SUNSET9 LLC: Case Summary & Unsecured Creditor
TIMS TRUCKING: Dugan Buying All Assets for 81K
TLC HEALTH NETWORK: Authorized to Use Cash Collateral Thru Jan. 30
TRANSGENOMIC INC: Dismisses Ernst & Young as Accountants
TRANSUNION LLC: Moody's Upgrades Corp. Family Rating to Ba3
UCI INTERNATIONAL: Plan Filing Period Extended Through Feb. 27
UNIFRAX HOLDING: S&P Revises Outlook to Stable & Affirms 'B' CCR
VACATION FUN: Wants to Use Civic Financial Cash Collateral
VAPOR CORP: Announces Preliminary Results of Cash Tender Offer
VAUGHAN FITNESS: U.S. Trustee Unable to Appoint Committee
VIOLIN MEMORY: Posts $17.6M Net Loss in 3 Months Ended Oct. 31
WILLIAM THOMAS JR: Court Won't Amend Clear Channel Lift Stay Order
YRC WORLDWIDE: Amends $350 Million Securities Prospectus with SEC
[*] Leveraged Loan Defaults Start Slow in 2017, Fitch Says
[*] Recoveries Drop for Sector Debt Holders, Fitch Says
[^] BOND PRICING: For the Week from January 16 to 20, 2017
*********
271 SEA BREEZE: Case Summary & Unsecured Creditor
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Debtor: 271 Sea Breeze Avenue LLC
569 East 8th Street
Brooklyn, NY 11218
Case No.: 17-40216
Nature of Business: Single Asset Real Estate
Chapter 11 Petition Date: January 19, 2017
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Hon. Elizabeth S. Stong
Debtor's Counsel: Jonathan S Pasternak, Esq.
DELBELLO DONNELLAN WEINGARTEN WISE & WIEDERKEHR,
LLP
One North Lexington Avenue
White Plains, NY 10601
Tel: (914) 681-0200
Fax: (914) 684-0288
E-mail: jpasternak@ddw-law.com
Total Assets: $10.0 million
Total Liabilities: $19.5 million
The petition was signed by Jonathan Rubin, manager.
The Debtor listed SDF50 Sea Breeze 1 LLC as its lone unsecured
creditor holding a claim of $9.5 million.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/nyeb17-40216.pdf
611 COMMERCIAL: May Convert to Ch. 7 if Sale Not Completed in 1 Yr
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611 Commercial, Inc., filed with the U.S. Bankruptcy Court for the
Middle District of Pennsylvania an amended disclosure statement
dated Jan. 16, 2017, referring to the Debtor's amended Chapter 11
plan of reorganization dated Jan. 16, 2017.
Class 6 Gerald Gay's Claims are unimpaired under the Plan and will
retain his interest in any remaining assets.
Class 4 Neil and Nancy Merring's Claim -- totaling 105,897.90 at 6%
-- will be paid in full at the time of the sale of the Debtor's
real estate. The sale must occur within one year of the effective
date of the Plan. If there is no sale within one year then case
converts to Chapter 7.
Since the filing of the Chapter 11 case, the Debtor has solicited
multiple developers and investors concerning the possible sale and
development of the three properties of the Debtor. In fact, the
Debtor was able to find a buyer for the Greenview Drive parcel and
that sale was approved by the Court and consummated in August 2015,
which resulted in the resolution of the largest secured claim of
the Debtor. The Monroe County Tax Claim Bureau received a large
property tax payment, as well. Since that time, the Debtor has
actively marketed for sale the remaining two parcels of the
property (611/Applegate parcel and Cherry Lane parcel). Both
properties are situated in very desirable locations. The
611/Applegate Parcel is contiguous to Route 611 in Stroudsburg.
There is a substantial amount of traffic that passes by that parcel
of property, each and every day. In fact, there is steady growth
along the 611 corridor which continues to support that market value
of the 611/Applegate Parcel.
The Cherry Lane Parcel is located in Tannersville, Pennsylvania,
and is, approximately, 100 yards from Route 611 in an area that is
growing at a tremendous pace because of the large growth of water
parks, skiing, snowboarding and other leisure activities in this
area. This has resulted in an increase in the market value of real
estate, as well as an increase in the turnover rate regarding real
estate in that area. These dynamics, thereby, increase the ability
of sellers to liquidate property in this area.
The Debtor intends to continue to market the properties in order to
acquire viable buyers. The Debtor is proposing in its Plan that it
will satisfy all remaining claims of the Debtor within one year of
the Effective Date of the Plan. The Plan does not require a
complete liquidation of all real estate since the Debtor believes
that the total value of each parcel of property exceeds the value
of the remaining claims. The Debtor will retain a portion of its
real estate after the balance of claims of the Debtor are paid or
resolved in accordance with the Plan. The Debtor has a limited
number of outstanding claims. The total amount of outstanding
claims, after all disputed issues are resolved is $174,046.55.
A sale of the 611/Applegate Parcel ($550,000) would far exceed the
total amount of these claims and the sale of the Cherry Lane Parcel
($200,000) would also result in enough income to pay all of the
claims in full. The Debtor is seeking the approval to receive one
year from the Effective Date to pay 100% of the outstanding
claims.
The Court has approved Thomas R. Wilkins of Better Homes and
Gardens Real Estate Wilkins & Associates, as real estate broker, to
sell these properties and, in addition, the principal of the
Debtor, Gerald Gay, has been taking an active role in finding a
suitable buyer for these parcels of land, as well.
The Debtor also agrees that if the sales strategies referred to are
not accomplished within one year of the Effective Date of the Plan
then, the Debtor agrees that the case will automatically convert to
Chapter 7 for liquidation by the Chapter 7 trustee.
A copy of the Amended Disclosure Statement is available at:
http://bankrupt.com/misc/pamb14-04173-164.pdf
As reported by the Troubled Company Reporter on Oct. 13, 2016, the
central theme of the Debtor's previous Chapter 11 Plan, as outlined
in the disclosure statement, is the liquidation of its real estate.
According to that plan, the Debtor's outstanding claims and their
remaining claim amounts are:
* Internal Revenue Service ($14,901)
* Department of Revenue ($600)
* Monroe County Tax Claim Bureau ($52,647)
* Neil and Nancy Merring ($105,898)
* Cisneroff Consulting (Disputed)
611 Commercial, Inc., is a Pennsylvania corporation which is
principally involved in the development and sale of its real
estate. The Debtor was incorporated on May 6, 2002.
The Debtor sought Chapter 11 protection (Bankr. M.D. Pa. Case No.
14-04173) on Sept. 9, 2014. The petition was signed by Gerald Gay,
president. The Honorable John J. Thomas is assigned to the case.
The Debtor estimated assets at $1 million to $10 million and
liabilities at $500,000 to $1 million. Philip W. Stock, Esq., at
the Law Office of Philip W. Stock serves as the Debtor's counsel.
7470 COMMERCIAL: U.S. Trustee Unable to Appoint Committee
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An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of 7470 Commercial Way Partners,
LLC, as of Jan. 19, according to a court docket.
About 7470 Commercial
7470 Commercial Way Partners, LLC, based in Las Vegas, Nevada,
filed a Chapter 11 petition (Bankr. D. Nev. Case No. 16-15253) on
Sept. 26, 2016. The Hon. Bruce T. Beesley presides over the case.
Samuel A. Schwartz, Esq., at Schwartz Flansburg PLLC, as bankruptcy
counsel.
In its petition, the Debtor estimated $1 million to $10 million in
both assets and liabilities. The petition was signed by David
Suder, managing member.
97-111 HALE: Sale of White Plains Property to Hale for $8M Denied
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Judge Robert D. Drain of the U.S. Bankruptcy Court for the Southern
District of New York denied the bidding procedures of 97-111 Hale,
LLC, and 100-114 Hale, LLC, in connection with their sale of
contiguous real property and improvements thereon located at 97-111
and 100-114 Hale Avenue, White Plains, New York, to Hale Avenue
Development, LLC, for $8,000,000, subject overbid.
A hearing on the Motion was held on Jan. 12, 2017.
The Court, after due deliberation, held that the proposed sale
would not be approved pursuant to 11 U.S.C. Section 363(b) and (f)
and, therefore, that the proposed bidding procedures, auction and
scheduling of the sale hearing would not be a good exercise of
business judgement or in the best interests of the Debtor's estate,
and (b) that the Debtors' requested relief would not adequately
protect the Secured Creditor's interests in the Debtors' property.
About 97-111 Hale
97-111 Hale, LLC, sought Chapter 11 protection (Bankr. S.D.N.Y.
Case No. 15-22381) on March 25, 2015. The case is assigned to
Robert D. Drain.
The Debtor has an estimated assets of $5,500,000 and $16,700,000
of
liabilities.
The Debtor tapped Jonathan S. Pasternak, Esq., at DelBello
Donnellan Weingarten Wise & Wiederkehr, LLP, as counsel.
The petition was signed by Eli Bobker, manager Hale Club, LLC,
managing member.
A.M. PRECISION: Taps Jeffrey Strange and Associates as Counsel
--------------------------------------------------------------
A.M. Precision Machining, Inc. seeks approval from U.S. Bankruptcy
Court for the Northern District of Illinois, Eastern Division, to
employ Jeffrey Strange and Associates as its counsel in this
chapter 11 case nunc pro tunc to the date of filing December 14,
2016.
Legal services to be rendered by Jeffrey Strange and Associates
are:
a. advise the Debtor with respect to their powers and duties
as debtors in possession in the continued management and operation
of their business and properties;
b. attend meetings and negotiate with representatives of
creditors and other parties in interest;
c. take all necessary action to protect and preserve the
Debtors' estates, including prosecuting actions on the Debtor's
behalf, defending any action commenced against the Debtors, and
representing the Debtors' interests in negotiations concerning all
litigation in which the Debtors are involved, including objections
to claims filed against the estate;
d. prepare all motions, applications, answers, orders,
reports, and papers necessary to the administration of the Debtors
estate and his Chapter 11 Case;
e. represent the Debtors in connection with obtaining any
post-petition financing;
f. advise the Debtors in connection with any potential sale of
assets;
g. appear before the Court, any appellate courts, and the
United States Trustee to protect the interests of the Debtor's
estates before those courts and the United States Trustee; and
Case
h. perform all other necessary legal services to the Debtors
in connection with the Chapter 11 Cases.
The firm shall be paid its customary hourly rates for its services.
Jeffrey Strange's rate is $450.00 an hour and Rod Rodjenovic's rate
is $395.00 an hour. Billing rates for attorneys for 2017 range from
approximately $250 per hour for associates to $450 per hour for
senior attorneys. Time devoted by legal assistants and law clerks
for 2017 is charged at billing rate of $100 per hour.
Jeffrey Strange, Esq. attests that his firm, its partners, and
associates are "disinterested persons" within the meaning of
section 101(14) of the Bankruptcy Code, as modified by section
1107(b), and its employment is permissible under sections 327(a)
and 328(a) of the Bankruptcy Code and is in the best interests of
all parties-in-interest.
The Firm can be reached through:
Jeffrey Strange, Esq.
JEFFREY STRANGE AND ASSOCIATES
717 Ridge Road
Wilmette, IL 60091
Tel: 847-256-7377
Fax: 847-256-1681
Email: jstrangelaw@aol.com
About A.M. Precision Machining Inc
AM Precision Machining Inc. of Elk Grove Village, IL, filed a
voluntary petition under Chapter 11 of the United States Bankruptcy
Court (Bankr. N.D. Ill. Case No.: 16-39379) on December 14, 2016.
The petition was signed by Stanley Kozlowski, president. The case
is assigned to Judge Pamela S. Hollis.
At the time of the filing, the Debtor estimated its assets at
$500,000 to $1 million and liabilities at $1 million to $10
million.
ACELITY LP: Moody's Assigns B1 Rating to New 1st Lien Debt
----------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Acelity's L.P.,
Inc.'s new senior secured credit facility, which includes $1.34
billion of first lien term loan debt and a $300 million revolving
credit facility. Moody's also withdrew the Speculative Grade
Liquidity Rating of SGL-2. All other existing ratings, including
the B3 Corporate Family Rating, B3-PD Probability of Default
Rating, and existing instrument ratings remain on review for
upgrade.
Proceeds from the new senior secured credit facility and
divestiture of Acelity's LifeCell business will together be used to
refinance and repay existing debt, pay transaction fees, and fund a
$100 million special dividend. The new financing is conditioned
upon Acelity completing the sale of its LifeCell business. Moody's
expects Acelity's pending $2.9 billion sale of LifeCell to
Allergan, Inc. (Baa3 stable) to close during the first quarter of
2017.
If the transaction is completed, Moody's expects to upgrade
Acelity's Corporate Family Rating to B2 from B3 and Probability of
Default Rating to B2-PD from B3-PD. Moody's also expects to
downgrade the existing senior secured first lien notes to B1 from
Ba3 due to the significant loss of cushion provided by more junior
debt in the new capital structure. Finally, Moody's anticipates
that it will upgrade Acelity's existing senior secured third lien
notes to Caa1 from Caa2.
"Acelity's sale of LifeCell along with the proposed refinancing
will result in a substantial deleveraging that will more than
offset the loss of scale and business diversification," stated
Moody's Vice President/Senior Analyst Jonathan Kanarek. Moody's
estimates that Acelity's pro forma adjusted debt to EBITDA will
decline to 5.6 times from 7.4 times currently.
Ratings assigned:
Acelity L.P., Inc.
Senior secured revolving credit facility expiring 2022 at B1
(LGD 3)
Senior secured USD first lien term loan due 2024 at B1 (LGD 3)
Senior secured EUR first lien term loan due 2024 at B1 (LGD 3)
Ratings remaining under review for upgrade:
Acelity L.P., Inc.
Corporate Family Rating at B3
Probability of Default Rating at B3-PD
Senior secured first lien extended revolving credit facility
expiring 2019 at Ba3 (LGD 2)
Senior secured USD first lien term loan due 2020 at Ba3 (LGD 2)
Senior secured EUR first lien term loan due 2020 at Ba3 (LGD 2)
Senior secured first lien notes due 2021 at Ba3 (LGD 2)
Senior secured second lien notes due 2021 at Caa1 (LGD 5)
Senior secured third lien notes due 2021 at Caa2 (LGD 6)
Senior unsecured notes due 2019 at Caa2 (LGD 6)
Ratings withdrawn:
Acelity L.P., Inc.
Speculative Grade Liquidity Rating at SGL-2
RATINGS RATIONALE
Moody's expects its ratings review to focus on Acelity's plans for
deleveraging into a more tenable capital structure with proceeds
from the divestiture of its regenerative medicine business. During
its review process, Moody's will also consider changes in business
concentration and overall scale and recent operating performance.
The expected upgrade to B2 in Acelity's Corporate Family Rating
reflects the material reduction in the company's financial leverage
and improvement in interest coverage that will result following
debt paydown. If upgraded, the B2 rating would reflect the firm's
high financial leverage, modest interest coverage, and high
business concentration. Moody's expects Acelity's debt to EBITDA to
gradually moderate towards 5.0 times by mid-2018. Furthermore,
Moody's anticipates Acelity's interest coverage (EBITA to interest
expense) to approach 1.6 in mid-2018. The firm's sale of its
regenerative medicine business (LifeCell) will elevate Acelity's
business risk by leaving it significantly concentrated within
advanced wound care. Acelity will also continue to face competitive
challenges in its core negative pressure wound therapy franchise.
The B2 rating is supported by Acelity's considerable scale and the
strong market presence of its Vacuum Assisted Closure products. The
ratings are also supported by the company's healthy margins and
Moody's expectation that growth in newer product offerings such as
incision management will help offset headwinds in the V.A.C.
business.
Excluding the proposed divestiture, the B3 Corporate Family Rating
reflects Acelity's very high financial leverage, limited free cash
flow and modest interest coverage. Also excluding the proposed
divestiture, Moody's does not expect a meaningful reduction in
leverage in the near-term as the company is facing challenges in
its core negative pressure wound therapy franchise and is still
required to make significant cash outlays related to litigation
settlements. The ratings also reflect Acelity's considerable scale
and the strong market presence of its Vacuum Assisted Closure
products. The ratings are also supported by the company's healthy
margins and the expectation that growth in newer product offerings
will help offset headwinds in the V.A.C. business.
The principal methodology used in these ratings was that for the
Global Medical Product and Device Industry published in October
2012.
Headquartered in San Antonio, Texas, Acelity is a global medical
technology company with leadership positions in advanced wound care
and regenerative medicine. Revenues are approximately $1.9, or $1.4
billion pro forma for the LifeCell divestiture. Acelity is owned by
a private equity consortium, including Apax Partners and affiliates
of the Canada Pension Plan Investment Board and Public Sector
Pension Investment Board.
ADS TACTICAL: Moody's Withdraws B2 CFR After Debt Refinancing
-------------------------------------------------------------
Moody's Investors Service is withdrawing the credit ratings of ADS
Tactical, Inc., including its B2 corporate family rating and stable
outlook following the refinancing of the company's bank debt that
included the repayment of the company's rated debt.
Ratings withdrawn:
Corporate Family Rating, B2
Probability of Default Rating, B2-PD
$275 million ($257 million outstanding) senior secured notes due
2018, B3 (LGD-5)
Stable outlook withdrawn
RATINGS RATIONALE
Moody's is withdrawing all of ADS Tactical's debt ratings due to
the repayment of the company's rated debt.
ADS Tactical Inc., through its operating subsidiary Atlantic Diving
Services, Inc. headquartered in Virginia Beach, VA, is a provider
of logistics and supply chain solutions for the U.S. Department of
Defense and Department of Homeland Security. Annual revenues
approximate $1.5 billion. ADS was founded in 1997 by its chairman,
Luke Hillier, the majority owner of the company.
ADVANCED MICRO DEVICES: BlackRock Reports 8.8% Stake as of Dec. 31
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BlackRock, Inc., disclosed in an amended Schedule 13G filed with
the Securities and Exchange Commission that as of Dec. 31, 2016, it
beneficially owns 81,784,076 shares of common stock of Advanced
Micro Devices Inc. representing 8.8 percent of the shares
outstanding. A full-text copy of the regulatory filing is
available for free at https://is.gd/VUEdHV
About Advanced Micro Devices
Sunnyvale, California-based Advanced Micro Devices, Inc.,
(NASDAQ:AMD) is a global semiconductor company. AMD --
http://www.amd.com/-- offers x86 microprocessors, as a standalone
central processing unit (CPU) or as incorporated into an
accelerated processing unit (APU), chipsets, and discrete graphics
processing units (GPUs) for the consumer, commercial and
professional graphics markets, and server and embedded CPUs, GPUs
and APUs, and semi-custom System-on-Chip (SoC) products and
technology for game consoles.
AMD incurred a net loss of $660 million on $3.99 billion of net
revenue for the year ended Dec. 26, 2015, compared to a net loss of
$403 million on $5.50 billion of net revenue for the year ended
Dec. 27, 2014.
As of Sept. 24, 2016, AMD had $3.61 billion in total assets, $3.23
billion in total liabilities and $385 million in total
stockholders' equity.
* * *
In September 2016, S&P Global Ratings affirmed its 'CCC+' corporate
credit rating on Sunnyvale, Calif.-based AMD. The outlook is
stable. In addition, S&P assigned its 'CCC' issue-level rating to
the company's senior unsecured convertible notes due in 2026. S&P
said the ratings reflect AMD's vulnerable business risk profile:
weak PC industry conditions, intense competition from Intel, and
challenges to grow in targeted enterprise, and embedded and
semi-custom product markets to offset PC business declines.
In September 2016, Moody's Investors Service affirmed AMD's 'Caa1'
corporate family rating and the 'Caa2' rating on the senior
unsecured notes, and revised the rating outlook to positive from
negative. The speculative grade liquidity rating is upgraded to
SGL-2 from SGL-3. The positive outlook reflects AMD's prospects
for improved operating performance and cash generation as well as
the improved product portfolio enabling the company to compete in
the current discrete GPUs (graphics processing unit), APUs
(application process units), x86 and ARM CPUs (central processing
unit) market. Moody's said, "Although we expect ongoing revenue
declines and operating losses in its PC-related business
(microprocessors and graphics chips), the growing EESC (enterprise,
embedded, and semi-custom) business supported by the reported
design wins, we project break even to modest profitability
beginning in the second half of 2016."
In March 2016, Fitch Ratings downgraded and withdrew the ratings
for AMD including the Long-term Issuer Default Rating (IDR) to
'CCC' from 'B-'. Fitch has withdrawn AMD's ratings for commercial
reasons. The downgrade reflects prospects for negative free cash
flow (FCF) over the intermediate term and the consequent liquidity
issues and refinancing risk that could develop as the 2019 and 2020
debt maturities approach.
AIRXCEL INC: S&P Assigns 'B' CCR & Rates $300MM Sr. Notes 'B'
-------------------------------------------------------------
S&P Global Ratings said it assigned its 'B' corporate credit rating
to Wichita, Kan.-based Airxcel Inc. The outlook is stable.
Airxcel plans to issue $300 million of senior secured notes due
2022 and an unrated $40 million asset based revolving credit
facility (ABL) due 2021. Airxcel will use the proceeds to
refinance all of its existing debt, to fund a distribution to its
owners, and for transaction fees and expenses.
At the same time, S&P assigned a 'B' issue-level rating and '3'
recovery rating to the company's proposed $300 million of senior
secured notes due 2022. The '3' recovery rating indicates S&P's
expectation for meaningful (50% to 70%; lower half of range)
recovery for lenders in the event of a payment default.
S&P did not assign ratings to the proposed $40 million ABL due
2021.
The company will use the proceeds from the proposed notes to
refinance all of its existing debt, to fund a distribution to its
owners, and for transaction fees and expenses. The ABL is expected
to be undrawn at close.
"The rating on Airxcel primarily reflects high leverage, our
anticipation for high EBITDA volatility over the economic cycle,
revenue concentration among its top customers, a relatively low
EBITDA margin, and small scale compared to other rated leisure
companies," said S&P Global Ratings credit analyst Daniel Pianki.
The company's leading market position in North America for most of
its products, a good percentage of sales to aftermarket customers,
and a low fixed cost base compared to some other leisure goods
manufacturers partly offset these risk factors.
The stable outlook reflects S&P's expectation for good operating
performance that will enable the company to modestly reduce
leverage, bringing adjusted debt to EBITDA to the high-4x area in
2017 and the mid-4x area in 2018.
ALLIANT HOLDINGS: S&P Retains 'B' CCR on Refinancing & Repricing
----------------------------------------------------------------
S&P Global Ratings said that its 'B' corporate credit rating on
Alliant Holdings L.P. and Alliant Holdings Intermediate LLC are
unchanged following the company's announced refinancing and
repricing of its term loan. The company is refinancing its
existing $278.6 million term loan B-2 tranche by upsizing its
original $1.3 billion term loan B by the same amount to create a
single term loan tranche. Proposed pricing on the term loan is
LIBOR plus 325 basis points with a 1% floor (a 25 basis point
improvement on the original term loan and 75 basis point
improvement on the B-2 tranche). Financial leverage of
approximately 7x (pro-forma for full year effect of acquisitions
closed in the last year) as of Sept. 30, 2016 is unchanged post
transaction, as debt levels stay the same. EBITDA interest coverage
will see a modest benefit from the better pricing.
The recovery ratings for Alliant's senior secured debt, including
the term loan due 2022 and a revolver due 2020, is a '3'
(indicating an expectation of substantial [50%-70%] recovery in
case of default; lower half of the range), following our recovery
rating update in December 2016. The recovery rating on the
company's second-lien senior secured debt remains '6'.
Simplified Recovery Waterfall
-- Emergence EBITDA: $178 mil.
-- Multiple: 6x
-- Gross recovery value: $1,070 mil.
-- Net recovery value for waterfall after admin expenses (5%):
$1,017 mil.
-- Obligor/non obligor valuation split: 100%/0%
-- Estimated first lien claim: $1,772 mil.
-- Value available for first lien claim: $1,017 mil.
-- Recovery range: 50-70% (at the lower end)
-- Estimated senior unsecured notes claim: $557 mil.
-- Estimated senior secured deficiency claim: $754 mil.
-- Value available for unsecured claim: $0 mil.
-- Recovery range: 0-10%
Note: All debt amounts include six months of prepetition interest.
RATINGS LIST
Alliant Holdings, L.P.
Ratings Affirmed, Recovery Rating Revised
To From
Senior Secured B B
Recovery Rating 3L 3H
Senior Unsecured CCC+ CCC+
Recovery Rating 6 6
AMERICAN CHARTER: Fitch Withdraws BB Rating on Series 2007A Bonds
-----------------------------------------------------------------
Fitch Ratings affirms and simultaneously withdraws the 'BB' rating
on approximately $72.8 million series 2007A bonds issued by the
Pima County Industrial Development Authority, Arizona (PCIDA). The
bonds were issued on behalf of the American Charter Schools
Foundation (ACSF).
SECURITY
The bonds are secured by a joint and several pledge of the revenues
of 10 ACSF schools in Arizona (collectively, the bond schools),
which primarily consists of per pupil state funding. The bonds are
additionally secured by a debt service reserve (DSR). The schools
also make annual renewal and replacement deposits. Charter payments
from the state are made directly to a bond trustee.
KEY RATING DRIVERS
RATING WITHDRAWAL: Fitch is withdrawing the rating as ACSF has
chosen to stop participating in the rating process. Therefore,
Fitch will no longer have sufficient information to maintain the
rating. Accordingly, Fitch will no longer provide analytical
coverage for ACSF.
WEAK FINANCIAL PROFILE: The rating affirmation reflects a history
of slim but positive GAAP operations (fiscal 2016 margins were
2.4%), a very limited financial cushion, a high debt burden and
slim but positive coverage of transaction maximum annual debt
service (TMADS). ACSF's financial profile has characteristics
consistent with a speculative grade rating.
ENROLLMENT ISSUES PERSIST: Aggregate enrollment at the 10 schools
leveled out in fall 2016 at 3,621 at the Dec. 2016 count, about the
same as the prior year. However, this remains well below the fall
2012 (fiscal 2013) enrollment of about 4,270. Enrollment
volatility is uneven among the 10 schools. The charter management
organization (CMO) has a history of managing effectively through
enrollment fluctuations.
STRUCTURAL BONDHOLDER PROVISIONS: Legal and structural security
measures include a trustee intercept of state aid. Fitch's rating
does not incorporate the intercept provision. This provides for
payment of debt service before any pro-rata distribution of
revenues to the schools, and contractual subordination of the CMO
fee.
RATING SENSITIVITIES
Rating sensitivities are not applicable to American Charter School
Foundation as the rating has been withdrawn.
CREDIT PROFILE
ACSF is composed of 10 charter high schools, nine of which operate
in the Phoenix, AZ metropolitan area. A 10th school operates in
Tucson. Enrollment at Dec. 23, 2016 (the 100-day count) was 3,621,
about the same as the prior year. However, this remains well below
fall 2012 enrollment of 4,270 and fall 2013 enrollment of 4,072.
ACFS has chosen not to participate in Fitch's rating process. The
resulting lack of information, particularly related to management,
enrollment trends for the potentially volatile alternate high
schools, future debt plans, and academic performance, do not
provide sufficient information and back-ground for Fitch to
maintain the rating.
All of the bond schools are alternative high schools except for
South Ridge. The schools maintain independent charters from the
Arizona State Board of Charter Schools (ASBCS). Seven of ACSF's
schools had 2017 charter expirations, which have been renewed to
2036; the remaining three charters expire in 2018, and are in the
renewal process. Long 15 to 20 year charter terms are standard in
Arizona. Fitch did talk with ASBCS, who reported that the ACSF
schools are currently in good standing and in compliance with
required reporting and academic plans.
The ACSF bond schools each have management agreements with the
Leona Group, one of the larger CMOs in Arizona. ASBCS reports a
positive working relationship with the operator.
All Arizona public schools, including charter schools, transitioned
to Common Core academic standards and testing in the 2014/2015
academic year. This transition means that 2014/2015 and 2015/2016
academic test results are not comparable to those of prior years.
The state is still developing year-to-year benchmarking and a
rating scale for Arizona schools. For both academic years, school
letter grades were not assigned or published. For the 2013/2014
academic year, seven of the schools met the ASBCS dashboard
expectations, and three did not. Fitch considers the lack of
current academic information for the ACSF schools, and related
management discussion, particularly troublesome.
SLIM OPERATING PERFORMANCE
For fiscal 2016, ACSF operating margins were $755,000 or 2.4%,
which was comparable to 2.2% in 2015 and 4.1% in 2014. The ACFS
bond schools, collectively, have generated slim but positive TMADS
coverage in each of the last seven years. Fitch defines TMADS as
maximum annual debt service excluding a balloon payment in the last
maturity (typically funded from the DSR). TMADS coverage was 1.3x
in both fiscals 2016 and 2015, compared to 1.4x in fiscal 2014 and
1.1x in 2013. The annual debt service coverage covenant is 1x.
Without management participation in the rating process, Fitch
cannot evaluate the schools financial expectation for fiscal 2017.
LIMITED BALANCE SHEET AND HIGH DEBT LEVERAGE
ACFS historically has a weak balance sheet. Available funds,
defined as cash and investments not permanently restricted, was
$2.6 million at the end of fiscal 2016, improved from $2.1 million
at fiscal year-end 2015. However, fiscal 2016 available funds
still represented a very slim 8.7% of operating expenses and 3.7%
of outstanding debt. The schools have a very high debt burden:
TMADS of $5.6 million (in 2038) was 18% of fiscal 2016 operating
revenues, comparable to recent years.
AMERICAN POWER: Incurs $10.4 Million Net Loss in Fiscal 2016
------------------------------------------------------------
American Power Group Corporation filed with the Securities and
Exchange Commission its annual report on Form 10-K disclosing a net
loss available to common stockholders of $10.40 million on $1.86
million of net sales for the year ended Sept. 30, 2016, compared to
a net loss available to common stockholders of $1.04 million on
$2.95 million of net sales for the year ended Sept. 30, 2015.
As of Sept. 30, 2016, American Power had $9.79 million in total
assets, $8.16 million in total liabilities and $1.62 million in
total stockholders' equity.
As of Sept. 30, 2016, the Company had $211,201 in cash and cash
equivalents and a working capital deficit of $1,130,201.
Schechter Dokken Kanter Andrews & Selcer, Ltd., in Minneapolis,
Minnesota, issued a "going concern" qualification on the
consolidated financial statements for the year ended Sept. 30,
2016, citing that the Company has suffered recurring losses from
operations and has a net capital deficiency that raises substantial
doubt about its ability to continue as a going concern.
A full-text copy of the Form 10-K is available for free at:
https://is.gd/siy2lW
About American Power Group
American Power Group's alternative energy subsidiary, American
Power Group, Inc. -- http://www.americanpowergroupinc.com/--
provides a cost-effective patented Turbocharged Natural Gas
conversion technology for vehicular, stationary and off-road mobile
diesel engines. American Power Group's dual fuel technology is a
unique non-invasive energy enhancement system that converts
existing diesel engines into more efficient and
environmentally friendly engines that have the flexibility to run
on: (1) diesel fuel and liquefied natural gas; (2) diesel fuel and
compressed natural gas; (3) diesel fuel and pipeline or well-head
gas; and (4) diesel fuel and bio-methane, with the flexibility to
return to 100 percent diesel fuel operation at any time. The
proprietary technology seamlessly displaces up to 80% of the
normal diesel fuel consumption with the average displacement
ranging from 40 percent to 65 percent. The energized fuel balance
is maintained with a proprietary read-only electronic controller
system ensuring the engines operate at original equipment
manufacturers' specified temperatures and pressures. Installation
on a wide variety of engine models and end-market applications
require no engine modifications unlike the more expensive invasive
fuel-injected systems in the market.
ARTFUL COLOR: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Artful Color, Inc.
dba MyPix2.Com
2501 Schieffelin Road, Suite 128
Apex, NC 27502
Case No.: 17-00286
Chapter 11 Petition Date: January 19, 2017
Court: United States Bankruptcy Court
Eastern District of North Carolina
(Raleigh Division)
Judge: Hon. Stephani W. Humrickhouse
Debtor's Counsel: Travis Sasser, Esq.
SASSER LAW FIRM
2000 Regency Parkway, Suite 230
Cary, NC 27518
Tel: 919-319-7400
Fax: (919) 657-7400
E-mail: tsasser@carybankruptcy.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Damon Rando, president.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/nceb17-00286.pdf
ATOP TECH: Jan. 27 Meeting Set to Form Creditors' Panel
-------------------------------------------------------
Andy Vara, Acting United States Trustee for Region 3, will hold an
organizational meeting on Jan. 27, 2017, at 10:00 a.m. in the
bankruptcy case of ATop Tech, Inc.
The meeting will be held at:
Office of the US Trustee
844 King Street, Room 3209
Wilmington, DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors pursuant
to Section 341 of the Bankruptcy Code. A representative of the
Debtor, however, may attend the Organizational Meeting, and provide
background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States Trustee
appoint a committee of unsecured creditors as soon as practicable.
The Committee ordinarily consists of the persons, willing to serve,
that hold the seven largest unsecured claims against the debtor of
the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee may
consult with the debtor, investigate the debtor and its business
operations and participate in the formulation of a plan of
reorganization. The Committee may also perform other services as
are in the interests of the unsecured creditors whom it
represents.
ATOPTECH INC: Draper Athena Buying All Assets for $8 Million
------------------------------------------------------------
ATopTech, Inc., asks the U.S. Bankruptcy Court for the District of
Delaware to authorize the bidding procedures in connection with the
sale of substantially all assets to Draper Athena Management Co.
Ltd. for $8,000,000, subject to higher or otherwise better bids.
Founded in April 2003 by a team of industry experts, the Company
competes in the physical design segment of the electronic design
automation ("EDA") industry, developing technology and
manufacturing software solutions for engineers in the physical
design of integrated circuits. Since its founding, the Company has
achieved steady financial growth, becoming a leader in the EDA
field.
Synopsys commenced litigation against the Company, asserting claims
for copyright infringement, infringement of four patents, breach of
a license agreement between the parties and breach of the covenant
of good faith and fair dealing. The litigation on these claims has
stretched out for more than three years. Through a motion to
dismiss, the Company successfully limited the scope and extent of
Synopsys' breach of contract claim, and through summary judgment,
limited the scope and extent of Synopsys' copyright infringement
claims. However, in March 2016, after a three-week trial, the jury
found in favor of Synopsys on the remaining copyright claim, which
alleged that the Company's P&R engine product, Aprisa, infringed on
copyrighted elements contained in one of Synopsys' products. The
jury awarded $30,400,000 to Synopsys.
The Synopsys Verdict created a significant challenge to the
Company's ability to continue its operations as a going concern.
The Company has taken steps to streamline its operations, including
ceasing any investment into its growth. After thoroughly
considering the strategic alternatives for the Company, the board
of directors decided that pursuing a sale, merger, acquisition
and/or related transaction was in the best interests of the
Company, its creditors and equity holders.
In July 2016, the Company retained Cowen and Co. as its investment
banker to assist in exploring a potential Transaction. Cowen has
engaged in a comprehensive marketing process, among other things,
contacting more than 140 potentially interested parties comprised
of both strategic and financial buyers, both in the United States
and China. After the initial conferences, 29 entities expressed
continued interest and executed non-disclosure agreements.
Cowen continued discussions with these entities and transmitted bid
letters and draft asset purchase agreements to 14 entities that
continued to express interest, and Cowen established a deadline of
Oct. 31, 2016, for interested parties to submit proposals to
qualify as a stalking horse bidder. In response, three parties
submitted bids, and others expressed interest but indicated that
they were not prepared at the time to commit to submitting a bid.
The board, in consultation with counsel and Cowen, evaluated the
three bids, negotiated revisions to the bids and eventually decided
to pursue what it considered to be the highest or otherwise best
bid.
At the Company's direction, Cowen engaged that bidder in
negotiations which culminated in the execution of a letter of
intent and the negotiation of substantial terms of an asset
purchase agreement. However, after several rounds of negotiations,
the board and the Company determined that certain demands made by
the proposed bidder were not in the best interests of the Company
and decided to cease negotiations and pursue alternatives.
Consequently, the Company turned its focus to another interested
party which submitted an attractive bid, Draper Athena. Again at
the Company's direction, Cowen engaged Draper Athena in
negotiations over several days, and, after multiple exchanges of
drafts, the Company and Draper Athena executed a Letter of Intent
on Dec. 2, 2016. Under the Letter of Intent, among other things,
Draper Athena required certain conditions to be satisfied including
the Debtor requesting the Court to approve, on an expedited basis,
certain bidding and sale procedures and break-up fee provisions and
the closing of a Transaction to Draper Athena by early March 2017.
The Debtor has determined, after considering its alternatives, that
maximizing the value of the Debtor's estate can be best
accomplished through a sale (pursuant to a chapter 11 case, free
and clear of liabilities) of the Acquired Assets.
The Debtor and the Stalking Horse also agreed to the bidding
procedures for an auction, which include a break-up fee and expense
reimbursement in the event a higher or otherwise better bid is
consummated.
Because the proposed Transaction would permit the business to be
sold as a going concern and given the extensive marketing efforts
undertaken by Cowen and analysis of the offers received thus far,
the Debtor has determined that the Stalking Horse Bid represents
the best opportunity for the Debtor to maximize the value of its
estate and serve as a basis for conducting an auction to seek
higher or otherwise better offers.
The transaction is subject to competitive bidding as set forth in
the Bidding Procedures. Pursuant to the terms of the Agreement,
the Stalking Horse has agreed to purchase the Acquired Assets for
$8,000,000 in immediately available funds, less certain adjustments
based on deferred revenue, plus the assumption of certain
post-petition liabilities as specifically set forth in the
Agreement.
The salient terms of the Agreement are:
a. Purchaser: Draper Athena Management Co. Ltd.
b. Purchase Price: $8,000,000 less Adjusted Deferred Gross
Revenue
c. Purchased Assets: Substantially all assets of the Debtor.
d. Assumed Liabilities: All liabilities under the Designated
Contracts to the extent arising after the Closing; and any
obligations related to the continued use of Intellectual Property
Rights after the Closing as determined in a final judgment in
connection with the Synopsys Patent Litigation.
e. Termination: Agreement can be terminated by (i) written
mutual consent; (ii) by either Purchaser or Seller, if the Closing
will not have occurred on 11:59 p.m. (PT) on the Outside Date (May
31, 2017); (iii) by either Purchaser or Seller if a Government
Entity will have issued a regulation or order which has the effect
of preventing the Transaction; (iv) by either the Purchaser or
Seller if the Court approves an Alternative Transaction; (v) by
Purchaser in the event of a breach of any obligation, warranty or
representation by the Seller; (vi) if a trustee is appointed and
such trustee rejects the Transaction.
f. Auction to be Conducted: There will be an Auction in the
event there are Qualified Bids other than the Stalking Horse Bid.
g. Closing and Other Deadlines: Closing must occur on May 31,
2017.
h. Good Faith Deposit: Stalking Horse deposit is in the amount
of $800,000, payable within 10 days of the entry of the Bidding
Procedures Order.
i. Use of Proceeds: No restriction on use of sale proceeds.
j. Rule 6004(h): The Sale order provides relief from
Bankruptcy Rule 6004(h).
The Agreement provides that the Debtor will pay, at Closing, the
Cure Amounts, as determined by the Court, if necessary, to cure all
defaults, including actual or pecuniary losses that have resulted
from defaults under the relevant Executory Contracts.
No less than 21 days prior to the Bid Deadline, the Debtor will
file with the Court and serve on each non-Debtor counterparty to an
executory contract or unexpired lease related to the Assets the
Cure Notice, substantially in the form attached to the Bidding
Procedures Order.
The Debtor is seeking approval of a Break-Up fee in the amount of
$400,000, which is approximately 5 of the purchase price for the
Acquired Assets.
In addition, the Debtor seeks approval of an Expense Reimbursement
to the Stalking Horse in the maximum amount of $600,000 in the
event the Stalking Horse Bid is not approved.
In accordance with Bankruptcy Rule 6004(f)(l), sales of property
outside the ordinary course of business may be by private sale or
by auction. The Debtor believes that good cause exists to expose
the Purchased Assets to sale at an auction and to approve the
procedures proposed. An auction conducted substantially in
accordance with the Bidding Procedures will enable the Debtor to
obtain the highest and best offers for the Purchased Assets,
thereby maximizing the value for the estates.
The salient points of the Bidding Procedures are:
a. Auction Baseline Bid: The purchase price for all or
substantially all of the Acquired Assets which must be greater than
the sum of $8,000,000 plus the Break-Up Fee and the Expense
Reimbursement.
b. Deposit: A deposit equal to 10% of the total cash and
noncash consideration.
c. Bid Deadline: March 13, 2017
d. Minimum Overbid: The minimum Overbid after and above the
Auction Baseline Bid will be made in increments of $100,000.
e. Selection of Successful Bid: The Prevailing Highest Bid
after each Overbid Round and the Successful Bidder following the
close of the Auction.
f. Closing with Alternative Back-Up Bidders: If an Auction is
conducted, the Qualified Bidder with the next highest or otherwise
best Bid at the Auction with respect to the Transferred Assets, as
determined by the Seller, will be designated as the backup bidder.
The Backup Bidder will be The Deposit of the Successful Bidder will
be applied to the purchase price at the closing. The Deposits for
each Qualified Bidder that is neither the Successful Bidder nor the
Backup Bidder will be returned within 3 business days after the
close of the Auction required to keep its last submitted Bid open
and irrevocable until the earlier of the closing of the transaction
with the Successful Bidder or the Outside Date.
g. Return of Deposits: The Deposit of the Successful Bidder
will be applied to the purchase price at the closing. The Deposits
for each Qualified Bidder that is neither the Successful Bidder nor
the Backup Bidder will be returned within 3 business days after the
close of the Auction.
A copy of the Agreement and the Bidding Procedures attached to the
Motion is available for free at:
http://bankrupt.com/misc/ATopTech_Inc_32_Sales.pdf
The Bidding Procedures provide the Debtor with the flexibility to
address unanticipated developments at the Auction, while ensuring
that the propriety of the procedures endures. Accordingly, the
proposed Bidding Procedures are reasonable, appropriate, and within
the Debtor's sound business judgment and should be approved.
The Debtor submits that entry into the Agreement is a sound
exercise of the Debtor's business judgment because: (i) the
Agreement provides for the sale of the Debtor's business as a going
concern, thereby maximizing the sale value, as compared to
liquidating its assets on a piecemeal basis and (ii) it allows
certain employees to continue employment by the Successful Bidder.
Accordingly, the Debtor asks the Court to approve the sale of
assets to the Buyer free and clear of all liens, claims,
encumbrances, and interest.
Although Bankruptcy Rules 6004(h) and 6006(d) and the Advisory
Committee Notes do not provide specific guidance when a court
should "order otherwise" and eliminate or reduce the 14-day
injunction period, commentators agree that the 14-day period should
be eliminated to allow a sale or other transaction to close
immediately where there has been no objection to the procedure.
Pursuant to the Agreement, and due to potentially diminishing value
of the Acquired Assets, the Debtor must close this sale promptly.
Thus, waiver of any applicable stays is appropriate in the
circumstance.
The Purchaser:
DRAPER ATHENA MANAGEMENT CO. LTD.
Room 504, 5/F, Block A, Sports International
100 Qianshan Road,
Governmental & Cultural New District
Hefei, Anhui Province, 230000
People's Republic of China
Telephone: +86-551-63530092
The Purchaser is represented by:
Alan Seem, Esq.
SHEARMAN & STERLING LLP
1460 El Camino Real, 2nd Floor
Menlo Park, CA 94025-4110
Telephone: (650) 838-3753
About ATopTech
ATopTech, Inc. -- http://www.atoptech.com/-- is in the business of
IC physical design. ATopTech claims its technology offers the
fastest time to design closure focused on advanced technology
nodes. The use of state-of-the-art multi-threading and
distributed
processing technologies speeds up the design process, resulting in
unsurpassed project completion times.
ATopTech, Inc., sought Chapter 11 protection (Bankr. D. Del. Case
No. 17-10111(MFW)) on Jan. 13, 2017. The petition was signed by
Claudia Chen, vice president, finance. The case is assigned to
Judge Mary F. Walrath.
The Debtor estimated assets and liabilities in the range of $10
million to $50 million.
ATopTech has retained Dorsey & Whitney as bankruptcy counsel and
Cowen and Company as its investment banker. Wilson Sonsini
Goodrich & Rosati, Professional Corporation, serves as corporate
and transactional counsel to ATopTech. Grant Thornton serves as
tax counsel; and Arnold & Porter serves as litigation counsel.
Epiq Bankruptcy serves as claims and notice agent.
AUTHENTIDATE HOLDING: CEO Holds 11.7% Equity Stake as of Dec. 19
----------------------------------------------------------------
In a Schedule 13D filed with the Securities and Exchange
Commission, Hanif A. Roshan disclosed that as of Dec. 19, 2016, he
may be deemed to be the beneficial owner of 844,339 shares of
Authentidate Holding Corp.'s common stock, representing 11.7% of
the outstanding shares of the Company's Common Stock. Those shares
exclude any and all shares which may be issued to Mr. Roshan as
additional consideration pursuant to the terms and conditions of
the Merger Agreement. The percentage of outstanding Common Stock
of the Company which may be deemed to be beneficially owned by the
Reporting Person was calculated based on 7,168,159 shares of the
Company's Common Stock outstanding, as reported in a Current Report
on Form 8-K filed by Authentidate Holding Corp. on Dec. 21, 2016.
Mr. Roshan, presently the chairman and CEO of Authentidate, stated,
"The Reporting Person currently intends to hold the shares of
Common Stock of the Company for investment purposes. The Reporting
Person does not have any current intention to purchase additional
shares of Common Stock. The Reporting Person may, from time to
time, acquire additional shares of Common Stock in open market or
negotiated block transactions, consistent with his investment
purposes or may acquire additional securities of the Issuer through
private transactions, which securities may be convertible into
additional shares of Common Stock. Additionally, the Reporting
Person may from time to time sell shares of Common Stock in open
market transactions or in negotiated block sales to one or more
purchasers, consistent with his investment purpose."
A full-text copy of the regulatory filing is available at:
https://is.gd/wY3fml
About Authentidate
Authentidate Holding Corp. and its subsidiaries provide secure
web-based revenue cycle management applications and telehealth
products and services that enable healthcare organizations to
increase revenues, improve productivity, reduce costs, coordinate
care for patients and enhance related administrative and clinical
workflows and compliance with regulatory requirements. The
Company's web-based services are delivered as Software as a Service
(SaaS) to its customers interfacing seamlessly with billing,
information and document management systems. These solutions
incorporate multiple features and security technologies such as
business-rules based electronic forms, intelligent routing,
transaction management, electronic signatures, identity
credentialing, content authentication, automated audit trails and
remote patient management capabilities. Both web and fax-based
communications are integrated into automated, secure and trusted
workflow solutions.
Authentidate reported a net loss of $9.7 million on $3.68 million
of total revenues for the year ended June 30, 2015, compared to a
net loss of $7.14 million on $5.55 million of total revenues for
the year ended June 30, 2014.
As of March 31, 2016, Authentidate had $55.2 million in total
assets, $11.5 million in total liabilities and $43.7 million in
total shareholders' equity.
EisnerAmper LLP, in New York, issued a "going concern"
qualification on the consolidated financial statements for the year
ended June 30, 2015, citing that the Company's recurring losses
from operations and negative cash flows from operations raise
substantial doubt about its ability to continue as a going concern.
AUTHENTIDATE HOLDING: Director Quits Over 'Lack of Transparency'
----------------------------------------------------------------
Ronald C. Oklewicz, a member of the Board of Directors of
Authentidate Holding Corp., delivered a letter notifying the
Company of his decision to resign from the Board effective Jan. 11,
2017.
In his letter, Mr. Oklewicz made statements expressing his
disagreements with the Company on matters relating to its
operations, policies or practices. Specifically, Mr. Oklewicz
stated he had concerns arising from an alleged lack of
transparency, candor and effective business processes. He further
alleged his exclusion from certain meetings of the board or
committees.
The Company strongly disagrees with a number of the statements and
assertions made by Mr. Oklewicz and submits the following in
response to Mr. Oklewicz's resignation letter.
"The Company strongly disputes Mr. Oklewicz's allegations of a lack
of transparency and candor which led to difficulties for the
combined board to establish trust and cooperation. The Company's
board of directors has held numerous formal, and other informal,
meetings during the course of the past year, at which Mr. Oklewicz
had mostly attended and was an active participant. In August 2016,
the board considered terminating its relationship with its then
Chief Executive Officer, Mr. Richard Hersperger, who was initially
introduced to the Company by Mr. Oklewicz. The board was concerned
that Mr. Oklewicz's relationship with Mr. Hersperger would cause
either a real or apparent conflict and therefore sought to remove
him from these deliberations. Further, both during and subsequent
to the events surrounding Mr. Hersperger's termination, Mr.
Oklewicz's actions as a board member became increasingly
adversarial and, invariably, his positions were more aligned with
those of Mr. Hersperger rather than the Company."
In effort to allow the board to consider the events surrounding Mr.
Hersperger's departure as CEO in confidence, the Company initially
considered forming an executive committee consisting of all the
members except for Messrs. Oklewicz and Hersperger. This
"committee" neither ever met nor took any action and was dissolved
in favor of a special committee consisting of three members on Dec.
7, 2016.
About Authentidate
Authentidate Holding Corp. and its subsidiaries provide secure
web-based revenue cycle management applications and telehealth
products and services that enable healthcare organizations to
increase revenues, improve productivity, reduce costs, coordinate
care for patients and enhance related administrative and clinical
workflows and compliance with regulatory requirements. The
Company's web-based services are delivered as Software as a Service
(SaaS) to its customers interfacing seamlessly with billing,
information and document management systems. These solutions
incorporate multiple features and security technologies such as
business-rules based electronic forms, intelligent routing,
transaction management, electronic signatures, identity
credentialing, content authentication, automated audit trails and
remote patient management capabilities. Both web and fax-based
communications are integrated into automated, secure and trusted
workflow solutions.
Authentidate reported a net loss of $9.7 million on $3.68 million
of total revenues for the year ended June 30, 2015, compared to a
net loss of $7.14 million on $5.55 million of total revenues for
the year ended June 30, 2014.
As of March 31, 2016, Authentidate had $55.2 million in total
assets, $11.5 million in total liabilities and $43.7 million in
total shareholders' equity.
EisnerAmper LLP, in New York, issued a "going concern"
qualification on the consolidated financial statements for the year
ended June 30, 2015, citing that the Company's recurring losses
from operations and negative cash flows from operations raise
substantial doubt about its ability to continue as a going concern.
AVAYA INC: Case Summary & 50 Largest Unsecured Creditors
--------------------------------------------------------
Debtor affiliates filing separate Chapter 11 bankruptcy petitions:
Debtor Case No.
------ --------
Avaya Inc. 17-10089
Two Penn Plaza
New York, NY 10121
Avaya CALA Inc. 17-10090
Avaya EMEA LTD. 17-10092
Avaya Federal Solutions, Inc. 17-10100
Avaya Holdings Corp. 17-10098
Avaya Holdings LLC 17-10094
Avaya Holdings Two, LLC 17-10095
Avaya Integrated Cabinet Solutions Inc. 17-10108
Avaya Management Services Inc. 17-10096
Avaya Services Inc. 17-10088
Avaya World Services Inc. 17-10097
Octel Communications LLC 17-10101
Sierra Asia Pacific Inc. 17-10102
Technology Corporation of America, Inc. 17-10107
Ubiquity Software Corporation 17-10104
VPNet Technologies, Inc. 17-10105
Zang, Inc. 17-10106
Sierra Communication International LLC 17-10103
Type of Business: Avaya Inc., together with its affiliates, is a
multinational company that provides
communications products and services, including,
telephone communications, internet telephony,
wireless data communications, real-time video
collaboration, contact centers, and customer
relationship software to companies of various
sizes
Chapter 11 Petition Date: January 19, 2017
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Judge: Hon. Stuart M. Bernstein
Debtors' Counsel: James H.M. Sprayregen, P.C.
Jonathan S. Henes, P.C.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022
Tel: (212) 446-4800
Fax: (212) 446-4900
E-mail: james.sprayregen@kirkland.com
jonathan.henes@kirkland.com
- and -
Patrick J. Nash, Jr., P.C.
Ryan Preston Dahl, Esq.
Bradley Thomas Giordano, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle
Chicago, Illinois 60654
Tel: (312) 862-2000
Fax: (312) 862-2200
E-mail: patrick.nash@kirkland.com
ryan.dahl@kirkland.com
bradley.giordano@kirkland.com
Debtors'
Investment
Banker: CENTERVIEW PARTNERS LLC
Debtors' Eric Koza
Restructuring Jesse DelConte
Advisor: ZOLFO COOPER LLC
Grace Building
1114 Avenue of the Americas, 41st Floor
New York, NY 10036
Tel: 212.561.4000
Fax: 212.213.1749
Email: ekoza@zolfocooper.com
jdelconte@zolfocooper.com
Debtors'
Auditors: PRICEWATERHOUSECOOPERS LLP
Debtors'
Tax &
Accountancy
Advisor: KPMG LLP
Debtors'
Accountancy
Advisor &
Financial
Services
Consultant: THE SIEGFRIED GROUP, LLP
Debtors'
Notice,
Claims &
Balloting
Agent: PRIME CLERK LLC
Total Assets: $5.52 billion as of Sept. 30, 2016
Total Debts: $6.35 billion as of Sept. 30, 2016
The petitions were signed by Eric S. Koza, CFA, chief restructuring
officer.
Avaya's List of 50 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Wistron Infocomm Technology America Trade $8,843,104
Attn: President or General Counsel
800 Parker Square, Suite 285A
Flower Mound, TX 75028
Tel: 026-616-9999;
915-782-7828
Fax: 886-6612-2930
Email: amanda_fulfillment@wistron.com
Avnet, Inc. Trade $8,822,799
Attn: President or General Counsel
2021 Lakeside Blvd
Richardson, TX 75082
Tel: 800-332-8638
Fax: 913-663-7979
Email: chelcie.cramer@avnet.com
Hewlett Packard Enterprise Company Trade $5,227,622
Attn: President or General Counsel
PO Box 740591
Los Angeles, CA 90074-0591
Tel: 650-857-1501
Fax: 650-857-4837
Email: us-enterprise-orders@hpe.com
Hewlett Packard Enterprise Company
Attn: President or General Counsel
3000 Hanover Street
Palo Alto, CA 94304
Verint Americas Inc. Trade $4,288,292
Attn: President or General Counsel
PO Box 904642
Charlotte, NC 28290-5642
Verint Americas Inc.
Attn: President or General Counsel
175 Broadhollow Rd., Suite 100
Melville, NY 11747
Email: Stephanie.Sewell@verint.com
SalesForce.com Inc. Trade $4,053,140
Attn: President or General Counsel
PO Box 842569
Boston, MA 02284-2569
SalesForce.com Inc.
Attn: President or General Counsel
The Landmark at One Market
suite 300
San Francisco, CA 94105
Email: collections@salesforce.com
Lite on Trading USA Inc. Trade $3,922,199
Attn: President or General Counsel
720 Hillview Drive
Milpitas, CA 95035
Tel: 408-946-4873
Fax: 408-130-7400
Email: Bingo.wang@liteon.com
Tapfin Process Solutions Trade $3,544,797
Attn: President or General Counsel
PO Box 905406
Charlotte, NC 28290-5406
Tapfin Process Solutions
Attn: President or General Counsel
100 Manpower Place
Milwaukee, WI 53212
Tel: 877-720-4384
Email: kendra.allbright@tapfin.com
Oracle America Inc. Trade $3,246,315
PO Box 198330
Atlanta, GA 30384
Oracle America Inc.
Attn: President or General Counsel
500 Oracle Parkway
Redwood Shores, CA 94065
Tel: 800-786-0404;
650-506-5200
Fax: 650-506-7114
Email: kavitha.venkatesh@oracle.com
IBM Corporation Trade $2,997,295
Attn: President or General Counsel
PO Box 534151
Atlanta, GA 30353-4151
IBM Corporation
Attn: President or General Counsel
1 New Orchard Road
Armonk, NY 10504-1722
Tel: 800-668-4423
646-619-8897
Email: slarusso@us.ibm.com
Infosys Technologies Limited Trade $2,074,090
Attn: President or General Counsel
Plot No 45 & 46 Electronics
Bangalore 0 560100
India
Tel: 510-742-3000
Fax: 510-742-3090
Email: mahesh_eswar@infosys.com
Mera Software Services Inc. Trade $1,790,116
Attn: President or General Counsel
5201 Great America Parkway
Santa Clara, CA 95054
Tel: 408-969-9762
Email: james.hymel@merasws.com
Flextronics Logistics USA Inc. Trade $1,708,837
Attn: President or General Counsel
847 Gibraltar Drive
Milpitas, CA 95035
Tel: 901-215-2700
Fax: 901-215-2724
Email: shrikant.karad@flextronics.com
World Trade Technology Inc. Trade $1,604,109
Attn: President or General Counsel
60 Weldon Parkway
Maryland Heights, MO 63043
Tel: 314-919-1400
Fax: 314-569-8300
Email: sean.liston@wwt.com
Xirrus Inc. Trade $1,546,159
Attn: President or General Counsel
2101 Corporate Center Drive
Thousand Oaks, CA 91320
Tel: 805-262-1663
Fax: 805-262-1601
Email: jeff.plowman@xirrus.com
Wistron Corporation Trade $1,353,645
Attn: President or General Counsel
No. 5, Hsin-Ann Road
Hsin Chu, 0 300
Taiwan
Tel: 886-2-8691-1206
Fax: 886-2-8691-2080
Email: amanda_fulfillment@wistron.com
Luxoft Global Operations GMBH Trade $1,281,567
Attn: President or General Counsel
Gubelstrasse 24
Zug 6300
Switzerland
Tel: 41-41-723-2040
212-964-9900
Fax: 212-964-4377
Email: luxavayainvoicing@luxoft.com
SHI International Corp. (Non-Pcard) Trade $1,251,508
Attn: President or General Counsel
33 Knightsbridge Rd
Piscataway, NJ 08854
Tel: 732-868-5964
Fax: 732-805-9669
Email: ucystems@shi.com
Marketsource Inc. Trade $1,248,922
Attn: President or General Counsel
PO Box 102348
Atlanta, GA 30368
Tel: 770-674-5000
Fax: 770-674-5077
Email: hsims@marketsource.com
Marketsource Inc.
Attn: President or General Counsel
11700 Great Oaks Way
Suite 500
Alpharetta, GA 30022
Flextronics Telecom Systems Ltd Trade $1,247,440
Attn: President or General Counsel
Level 3, Alexander House 35
Cybercity
Ebene
Mauritius
Tel: 86-7565138000
Fax: 86-7565218088
Email: srinath.gopalaramakrishnan@flextronics.com
American Express Corp Card Remit Trade $1,210,802
Attn: President or General Counsel
20002 N 19th Ave
Phoenix, AZ 85027
Tel: 602-537-8500
Fax: 602-744-8603
Email: tracy.a.mcdonald@aexp.com
Communications Test Design Inc.
Attn: President or General Counsel
PO Box 416086
Boston, MA 02241-6086
Communications Test Design Inc. Trade $1,199,837
Attn: President or General Counsel
1373 Enterprise Drive
West Chester, PA 19380
Tel: 610-436-5203
Fax: 610-436-6890
Email: shartshorne@ctdi.com
Stream International Trade $1,175,353
Attn: President or General Counsel
3285 Northwood Circle
Eagan, MN 55121
Tel: 902-537-0647
Fax: 902-491-5872
Email: vinod.radhakrishnan@convergys.com
Oracle Credit Corporation Trade $1,000,000
Attn: President or General Counsel
260 N Charles Lindergh Dr
Salt Lake City, UT 84116
Tel: 650-506-2020
Fax: 650-633-0804
Email: konstantain.chabanny@oracle.com
ServiceSource International Inc. Trade $990,857
Attn: President or General Counsel
634 2nd Street
San Francisco, CA 94107
Tel: 800-211-5868
415-901-6030
Email: agencybilling@servicesource.com
Empirix Inc. Trade $967,962
Attn: President or General Counsel
Dept Ch 10919
Palatine, IL 60055-0909
Empirix Inc.
Attn: President or General Counsel
600 Technology Park Drive
Suite 100
Billerica, MA 01821
Tel: 972-461-4441
978-313-7000
Fax: 978-313-7001
Email: sgoodman@empirix.com
Innovatia Inc. Trade $966,056
Attn: President or General Counsel
Innovatia Inc., a Canadian Corp
1 Germain Street
Saint John, NB E2L 4VI
Canada
Tel: 506-640-4118
Fax: 506-640-4422
Email: andrea.sherwood@innovatia.net
Teletech Trade $883,933
Attn: President and General Counsel
9197 South Peoria Street
Englewood, CO 80112
Tel: 303-397-8100
Fax: 303-3978-670
Email: ap-invoicesinquiries@teletech.com
Holland & Knight Trust Account Trade $736,377
Attn: President or General Counsel
1600 Tysons Blvd, Suite 700
Mclean, VA 22102-4867
Tel: 703-720-8604
Fax: 703-720-8610
Email: stuart.mendelsohn@hklaw.com
Grape UP Sp. Z o.o. Trade $734,984
Attn: President or General Counsel
UI Pranicka 89 6
Krakow 31-202
Poland
Tel: 48-12-416-11-49
Email: office@grapeup.com
CSC Covansys Corporation Trade $711,655
Attn: President or General Counsel
22475 Network Place
Chicago, IL 60673
Tel: 248-848-8853
Fax: 248-488-2098
Email: aramericas@csc.com
Computer Generated Solutions Trade $670,237
Attn: President or General Counsel
2-56 K 40 Khanamet
Madhapur, Hyderabad 500081
India
Tel: 212-408-3800
Fax: 212-977-7474
Email: srvish@cgsinc.com
Flextronics America Trade $665,966
Attn: President or General Counsel
1000 Technology Drive
West Columbia, SC 29170-2263
Tel: 803-936-5200
Email: mxgdlarremittancepaymentsfiebv@flextronics.com
CyrusOne Trade $653,289
Attn: President or General Counsel
1649 W Frankford Road
Carrollton, TX 75007
Tel: 513-841-5040
Fax: 713-353-1089
Email: veronica.cochrum@cbts.cinbell.com
MarketStar Corporation Trade $613,280
Attn: President or General Counsel
2475 Washington Road
Ogden, UT 84401
Tel: 800-877-8259
Fax: 801-393-4115
Email: djones@marketstar.com
Servion Global Solutions Trade $608,132
Attn: President or General Counsel
3 Independence Way, Suite 304
Princeton, NJ 08540
Tel: 609-987-0044
Fax: 609-514-5118
Email: ar@servionusa.com
PM Telco LLC Trade $577,365
Attn: President or General Counsel
11 Canal Center Plaza S-200
Alexandria, VA 22314
Tel: 410-695-1459
Fax: 410-695-1459
Email: richard.myers@robbinsgioia.com
Coupa Software Inc. Trade $575,137
Attn: President or General Counsel
PO Box 398396
San Francisco, CA 94139-8396
Tel: 775-800-1111
Fax: 650-401-7907
Email: ar@coupa.com
Coupa Software Inc.
Attn: President or General Counsel
1855 S. Grant Street
San Mateo, CA 94402
Convergys HR Management NAR Trade $554,606
Attn: President or General Counsel
1450 Solutions Center
Chicago, IL 60677-1004
Tel: 513-784-5472
Fax: 513-241-4836
Email: sonal.m.grzymajlo@convergys.com
Wipro LTD Trade $550,688
Attn: President or General Counsel
Doddakannelli Sarjaupr Rd
Bangalore 560035
India
Tel: 91-80-28440011
Fax: 91-80-28440256
Email: debtors-usa@wipro.com
Nuance Communications Inc. Trade $548,409
Attn: Brendan McKay
One Wayside Road
Burlington, MA 01803
Tel: 781-565-5197
Fax: 781-565-5001
Email: janice.buck@nuance.com
Aricent Technologies (Holdings) LTD Trade $514,940
Attn: President or General Counsel
700 Hansen Way
Palo Alto, CA 94304
Tel: 620-391-1088
Fax: 650-551-9901
Email: nkihil.gulati@aricent.com
Red Hat Inc. Trade $484,362
Attn: President or General Counsel
PO Box 1018-8655
Raleigh, NC 27601
Red Hat Inc.
Attn: President or General Counsel
100 East Davie Street
Raleigh, NC 27601
Tel: 919-754-3700
Fax: 919-754-3701
Email: collectus@redhat.com
Anixter Inc. Trade $467,380
President or General Counsel
PO Box 847428
Dallas, TX 75284-7428
Tel: 800-323-8167
714-695-2259
Fax: 224-521-8100
Email: patricia.webb@anixter.com
Anixter Inc.
Attn: President or General Counsel
2301 Patriot Blvd.
Glenview, IL 60026
Apex Systems Inc. Trade $455,509
Attn: President or General Counsel
3750 Collections Center Drive
Chicago, IL 60693
Tel: 804-342-9090
Fax: 800-847-5737
Email: clmiller@apexsystemsinc.com
Delta Networks Inc. Trade $418,393
Attn: President or General Counsel
186 Ruey Kuag Road
Neihu
Taipei City
Taiwan
Tel: 866-2-8797-2088
Fax: 866-2-8797-2120
Email: qiuxia.zhang@deltaww.com.cn
Infocrossing LLC Trade $417,715
Attn: President or General Counsel
PO Box 415697
Boston, MA 02241-5699
Tel: 201-840-4757
Fax: 201-840-7217
Email: ronnie.green@wipro.com
Dynalec Corp.
Attn: President or General Counsel
PO Box 5337
Syracuse, NY 13220-5337
Dynalec Corp Trade $413,460
Attn: President or General Counsel
87 W Main Street
Sodus, NY 14551
Tel: 315-483-6924
Fax: 315-483-6656
Email: loristp@dynalec.com
Prosys Information Systems Inc. Trade $401,543
Attn: President or General Counsel
28545 Network P
Chicago, IL 60673-1285
Tel: 786-231-2178
Fax: 770-300-0486
Email: arremittance@prosys.com
AudioCodes Inc.
Attn: President or General Counsel
PO Box 10056
Uniondale, NY 11555-1005
AudioCodes Inc. Trade $384,976
Attn: President or General Counsel
2099 Gateway Pl, Suite 500
San Jose, CA 95110-1087
Tel: 972-3-976-4000
408-441-1175
Fax: 972-3-976-4040
408-451-9520
Email: david.macmaster@audiocodes.com
Network-1 Security Solutions, Inc. Litigation Undetermined
Attn: President or General Counsel
445 Park Avenue
Suite 1028
New York, NY 10022
Tel: 212-829-5770
Fax: 212-829-5771
Email: info@network-1.com
AVAYA INC: Files for Chapter 11 Bankruptcy Protection
-----------------------------------------------------
Burdened with an unsustainable capital structure of approximately
$6 billion of secured debt, Avaya Inc., together with 17 of its
domestic subsidiaries, commenced a voluntary case under Chapter 11
of the Bankruptcy Code to right-size its balance sheet. The
Company's foreign affiliates are not included in the filing and
will continue normal operations.
The Chapter 11 cases are pending before the U.S. Bankruptcy Court
for the Southern District of New York (Manhattan). The Hon. Stuart
M. Bernstein is assigned to the cases and the Debtors have
requested joint administration of the cases under Case No.
17-10089.
"We have conducted an extensive review of alternatives to address
Avaya's capital structure, and we believe pursuing a restructuring
through chapter 11 is the best path forward at this time," said
Kevin Kennedy, chief executive officer of Avaya, in a press
release. "Reducing the Company's current debt through the chapter
11 process will best position all of Avaya's businesses for future
success."
As part of Avaya's comprehensive assessment of options to address
its capital structure, the Company said it evaluated expressions of
interest in various Avaya assets, including its Contact Center
business. After extensive evaluation in consultation with its
financial and legal advisors, the Avaya Board of Directors has
determined that focusing on the Company's debt structure is
paramount and a sale of the Contact Center business at this time
would not maximize value for Avaya's customers and all of its
stakeholders. Avaya remains in ongoing negotiations to monetize
certain other assets, as appropriate, to maximize value for all
stakeholders.
"This is a critical step in our ongoing transformation to a
successful software and services business. Avaya's current capital
structure is over 10 years old and was put in place to support our
business model as a hardware-focused company, which has evolved
significantly since that time. Now, as a result of the terms of
Avaya's debt obligations and the upcoming debt maturities, we need
to recapitalize the Company," continued Mr. Kennedy.
The majority of Avaya's funded debt is a legacy of the 2007
transaction in which Avaya was taken private through a transaction
that valued Avaya's then-current operations at approximately $8.2
billion. Avaya's current funded debt consists of: (a) $55 million
prepetition domestic ABL Credit facility; (b) $3.23 billion
prepetition cash flow credit facility; (c) $1.29 billion first lien
notes; (d) $1.38 billion second lien notes; and (e) $50 million
prepetition foreign ABL credit facility. Roughly $617 million of
Avaya's indebtedness is scheduled to mature in October 2017.
Avaya also owes pensioners $1.5 billion, including underfunding
liabilities arising from two single employer defined benefit
pension plans sponsored by Avaya as well certain other
postretirement pension obligations.
The Santa Clara, California-based telecommunications company said
the "great recession" along with the market shift away from
hardware-based business communications under the capital
expenditure model towards software and services offerings under the
operating expense model had a substantial impact on its operations.
Avaya also faces ongoing competition to its core Unified
Communications Product and Service offerings from numerous
competitors such as Cisco and Microsoft.
"In light of these factors, the Avaya Enterprise experienced
significant revenue declines over the past several years. Despite
Adjusted EBITDA remaining resilient during this time period ...
significant annual cash requirements largely consumed Adjusted
EBITDA and have constrained the Avaya Enterprise's cash flows,"
said Eric S. Koza, chief restructuring officer of Avaya, in an
affidavit filed with the Court.
The Company has obtained a committed $725 million
debtor-in-possession financing facility underwritten by Citibank.
Subject to Court approval, this DIP financing, combined with the
Company's cash from operations, is expected to provide sufficient
liquidity during the Chapter 11 cases to support its continuing
business operations and minimize disruption.
First Day Motions
Contemporaneously with the filing of the voluntary petitions, the
Debtors filed a number of "first-day" motions with the Court to
facilitate a smooth transition into Chapter 11 and minimize
business disruption. Among other things, the motions request
authorization to continue certain customer and partner programs,
and to honor certain employee compensation and benefit
obligations.
About Avaya
Avaya Inc., and its debtor-affiliates, together with their 158
non-debtor affiliates (collectively, the "Avaya Enterprise"), are a
global provider of contact center, unified communications, and
networking products and services, which serves over 200,000 direct
and indirect customers, consisting of multinational enterprises,
small- and medium-sized businesses, and 911 services as well as
government organizations operating in a diverse range of
industries. The Avaya Enterprise has approximately 9,700
employees worldwide as of Dec. 31, 2016, with the Debtors'
workforce consisting of approximately 3,800 employees.
Advisors
The Debtors have hired Kirkland & Ellis LLP as counsel, Centerview
Partners LLC as investment banker, Zolfo Cooper LLC as
restructuring advisor, PricewaterhouseCoopers LLP as auditors, KPMG
LLP as tax and accountancy advisor, The Siegfried Group, LLP as
financial services consultant and Prime Clerk LLC as notice, claims
and balloting agent.
AVAYA INC: Files for Chapter 11, Has $725MM DIP Loan from Citibank
------------------------------------------------------------------
Avaya Inc., together with certain of its domestic subsidiaries, on
Jan. 19 commenced a formal proceeding to restructure its balance
sheet to better position itself for the future.
To facilitate this restructuring, the Company filed voluntary
petitions under chapter 11 of the U.S. Bankruptcy Code in the
United States Bankruptcy Court for the Southern District of New
York. The Company's foreign affiliates are not included in the
filing and will continue normal operations.
The Company has obtained a committed $725 million
debtor-in-possession financing facility underwritten by Citibank.
Subject to Court approval, this DIP financing, combined with the
Company's cash from operations, is expected to provide sufficient
liquidity during the chapter 11 cases to support its continuing
business operations and minimize disruption.
Jessica DiNapoli, writing for Reuters, reported that at a hearing
on Friday, Bankruptcy Judge Stuart Bernstein authorized Avaya to
tap on $425 million of the DIP facility. Avaya will return to the
Bankruptcy Court today, Jan. 23, to seek approval of other
expenses.
A copy of the DIP Overview, including a 17-week budget, is
available at https://is.gd/VUQ2IE
As part of Avaya's comprehensive assessment of options to address
its capital structure, the Company evaluated expressions of
interest in various Avaya assets, including its Contact Center
business. After extensive evaluation in consultation with its
financial and legal advisors, the Avaya Board of Directors has
determined that focusing on the Company's debt structure is
paramount and a sale of the Contact Center business at this time
would not maximize value for Avaya's customers and all of its
stakeholders. Avaya remains in ongoing negotiations to monetize
certain other assets, as appropriate, to maximize value for all
stakeholders.
Sale of Contact Center Biz on Hold,
Sale of All Assets to Lenders Mulled
In a regulatory filing with the Securities and Exchange Commission
on Thursday, the Company noted it has pursued a potential
disposition of its contact center businesses. The Company ran a
sale process for the Contact Center Business and received the $3.9
billion bid. The Company said it does not believe the $3.9 billion
bid is actionable and the sale process was terminated. The Company
has received an updated proposal from a previously involved party
for the potential disposition of its Contact Center Business which
purports to ascribe a purchase price of approximately $3.5 billion,
subject to various adjustments and conditions.
According to Reuters, citing a person familiar with the matter,
Clayton Dubilier & Rice LLC had been in the lead to acquire the
Contact Center business, but Avaya and CD&R could not agree on the
price, terms or how the deal would effect Avaya's pension
obligations.
On Thursday, The Company said it is evaluating that proposal but
there can be no assurance that that proposal is either viable or
will be acceptable to the Company. The Company is currently
pursuing a potential disposition of its networking businesses,
which shall be subject to, among other things, approval of the
Bankruptcy Court.
A draft copy of the stock and asset purchase agreement filed by
Avaya with the Securities and Exchange Commission indicates that
the Purchaser shall have the right to assign its rights and/or
obligations under the SAPA, in whole or in part, including its
right to acquire any particular assets or equity, to one or more of
its affiliates. The capital structure and corporate governance of
Purchaser shall be determined by the Requisite First Lien Lenders
in their sole discretion.
A Summary of Principal Terms of Proposed Sale of Substantially
All of the Assets of Avaya Holdings Corp. and Certain of its
Subsidiaries, is available at https://is.gd/YPGo3k
A copy of Avaya's Update on Contact Center M&A Process [December
2016] is available at https://is.gd/Fi1ZMi
Copies of the Project Arrowhead Cleansing Materials [December 2016]
prepared by Avaya are available at https://is.gd/LgTj3V and
https://is.gd/ezkmhJ
Confidentiality Deals with Creditors
In December 2016, the Company entered into separate confidentiality
agreements with members of an ad hoc group of certain first and
second lien creditors of the Company -- Ad Hoc Crossholder Group --
and with members of an ad hoc group of certain first lien creditors
of the Company -- Ad Hoc First Lien Group.
In connection with the Company's ongoing discussions with the
Creditor Groups regarding potential restructurings and strategic
alternatives, in December 2016, the Company prepared and provided
to the Creditor Groups and their professional advisors
presentations related to certain potential restructuring and
disposition scenarios.
On December 20, 2016, in connection with discussions with
representatives of the Creditor Groups, the Company submitted a
proposal to the Creditor Groups regarding a potential in-court
restructuring of the Company's debt obligations.
A copy of the draft Restructuring Term sheet dated Dec. 20 is
available at https://is.gd/a4dfYQ
A copy of the draft Restructuring Term sheet dated Dec. 30 is
available at https://is.gd/XKoVvS
A copy of the draft Restructuring Term sheet dated Jan. 10 is
available at https://is.gd/J8Ox4z
Legacy Debt, Unsecured Claims Unimpaired
The Jan. 10 iteration of the Restructuring Term Sheet envisions a
bankruptcy-exit Plan for Avaya, which provides for this treatment
of claims against, and interests in, the Company:
(a) Allowed administrative, priority, and priority tax
claims will be paid in full, in cash, upon the Effective
Date or as soon as reasonably practicable thereafter.
(b) Other Secured Claims: in full and final satisfaction of
such claims, each such holder shall receive at the
Reorganized Company's discretion: (i) payment in full in
cash of the unpaid portion of such Other Secured Claim
on the Effective Date or as soon thereafter as
reasonably practicable (or if payment is not then due,
shall be paid in accordance with its terms in the
ordinary course); (ii) reinstatement of such Other
Secured Claim; (iii) the Company's interest in the
collateral securing such claim; or (iv) such other
treatment rendering such claims unimpaired.
(b) DIP Facility Claims: in full and final satisfaction of
such claims, the DIP Facility Claims shall be paid in
full, in cash.
(c) Domestic ABL Facility Obligations: in full and final
satisfaction of such claims, the Domestic ABL Facility
Obligations shall be paid, in full, with proceeds from
the DIP Facility.
Citicorp USA, Inc. serves as administrative agent and
collateral agent.
As of January 15, 2017, obligations outstanding under
the Domestic ABL Facility total approximately $[55]
million plus accrued and unpaid interest.
(d) Foreign ABL Obligations: in full and final satisfaction
of such claims, the Foreign ABL Facility Obligations
shall be paid, in full, with proceeds from the DIP
Facility.
Citibank, N.A., serves as administrative agent and
collateral agent.
As of January 15, 2017, obligations outstanding under
the Foreign ABL Facility total approximately $[50]
million plus accrued and unpaid interest.
(e) Cash Flow Credit Facility Obligations: in full and final
satisfaction of such claims (including with respect to
any deficiency claims or adequate protection claims
arising in connection with the DIP Facility), the Cash
Flow Credit Facility Obligations shall receive, ratably
with the First Lien Notes Obligations:
(x) the New Debt (which shall not be less than $1,898
million in the aggregate); and
(y) 65% of the Reorganized HoldCo Equity, subject to
dilution by the MEIP (the "First Lien Equity
Distribution");
provided that if the amount drawn under the Exit
Facility is less than $602 million as of the
Effective Date, there will be a dollar-for-dollar
increase in the principal amount of the New Debt,
and the First Lien Equity Distribution will be
decreased ratably, at a rate of 0.025% per
$1 million of such additional New Debt.
Citibank, N.A., serves as administrative agent and
collateral agent.
As of January 15, 2017, obligations outstanding under
the Cash Flow Credit Facility total approximately
$[3,235] million plus accrued and unpaid interest,
consisting of: (i) $[616] million outstanding in Term
B-3 loans maturing October 26, 2017, (ii) $[1] million
outstanding in Term B-4 loans maturing October 26, 2017,
(iii) $[537] million outstanding in Term B-6 loans
maturing March 31, 2018, and (iv) $[2,081] million
outstanding in Term B-7 loans maturing May 29, 2020.
(f) First Lien Notes Obligations: in full and final
satisfaction of such claims (including with respect to
any deficiency claims or adequate protection claims
arising in connection with the DIP Facility), the First
Lien Notes Obligations shall receive, ratably with the
Cash Flow Credit Facility Obligations:
(x) the New Debt (which shall not be less than $1,898
million in the aggregate); and
(y) First Lien Equity Distribution; provided that if the
amount drawn under the Exit Facility is less than
$602 million as of the Effective Date, there will be
a dollar-for-dollar increase in the principal amount
of the New Debt, and the First Lien Equity
Distribution will be decreased ratably, at a rate of
0.025% per $1 million of such additional New Debt.
The First Lien Notes comprise the 9.0% Senior Secured
Notes and the 7.0% Senior Secured Notes.
The 7.00% Senior Secured Notes due April 1, 2019, were
issued under the indenture, dated as of February 11,
2011, with The Bank of New York Mellon Trust Company,
N.A., as trustee and notes collateral agent. As of
January 15, 2017, obligations outstanding under the 7.0%
Senior Secured Notes and the 7.0% Senior Secured Notes
Indenture total approximately $[1,009] million plus
accrued interest.
The 9.00% Senior Secured Notes due April 1, 2019, were
issued under the indenture dated as of December 21,
2012, with The Bank of New York Mellon Trust Company,
N.A., as trustee and notes collateral agent. As of
January 15, 2017, obligations outstanding under the 9.0%
Senior Secured Notes and the 9.0% Senior Secured Notes
Indenture total approximately $[290] million plus
accrued and unpaid interest.
(g) Second Lien Notes Obligations: in full and final
satisfaction of such claims (including with respect to
any deficiency claims), the Second Lien Notes
Obligations shall receive 35% of the Reorganized HoldCo
Equity, subject to dilution by the MEIP (the "Second
Lien Equity Distribution"); provided, that if the
aggregate principal amount of the New Debt to be
distributed on account of the First Lien Debt is
increased as set forth in (e) and (f) above, the Second
Lien Equity Distribution will be increased ratably, at a
rate of 0.025% per $1 million of such additional New
Debt.
The 10.50% Senior Secured Notes due March 1, 2021, were
issued under the indenture dated as of March 7, 2013,
with The Bank of New York Mellon Trust Company, N.A., as
trustee and notes collateral agent. As of January 15,
2017, obligations outstanding under the Second Lien
Notes and the Second Lien Indenture total approximately
$[1,384] million plus accrued and unpaid interest.
(h) Legacy Liabilities: the Legacy Liabilities shall be
unimpaired. These liabilities arise from the Avaya
Pension Plan; and the Avaya Pension Plan for Salaried
Employees; other, non-pension post-retirement benefit
plans; and Avaya Inc.'s support obligations under
certain letter agreements between Avaya Inc. and certain
non-debtor affiliates.
(i) General Unsecured Claims: General Unsecured Claims shall
be unimpaired.
(j) Existing HoldCo Equity: Existing HoldCo Equity shall
receive no recovery.
The Restructuring Term Sheet provides that Avaya will incur New
Debt -- other than the Exit Facility -- in the form of term loans
and/or notes, in an amount not less than $[1,898] million at a
weighted average cash interest rate of [8.0]%, with a [7] year
tenor, and on terms materially consistent in all respects with this
Restructuring Term Sheet and otherwise reasonably acceptable to the
Company and the Requisite Consenting Creditors. The New Debt shall
be secured by substantially all of the Reorganized Company's
assets, subject to customary exclusions and exceptions; provided
that liens securing the New Debt shall be junior to liens securing
the Exit Facility with respect to ABL Priority Collateral.
In connection with the Company's review of potential restructuring
and strategic alternatives, the Company reviewed a proposal
provided by the Pension Benefit Guaranty Company on December 16,
2016. A copy of the PBGC terms and conditions is available at
https://is.gd/Pri7Mz
CEO's Statement
"We have conducted an extensive review of alternatives to address
Avaya's capital structure, and we believe pursuing a restructuring
through chapter 11 is the best path forward at this time," said
Kevin Kennedy, Chief Executive Officer of Avaya. "Reducing the
Company's current debt through the chapter 11 process will best
position all of Avaya's businesses for future success."
"This is a critical step in our ongoing transformation to a
successful software and services business. Avaya's current capital
structure is over 10 years old and was put in place to support our
business model as a hardware-focused company, which has evolved
significantly since that time. Now, as a result of the terms of
Avaya's debt obligations and the upcoming debt maturities, we need
to recapitalize the Company," continued Mr. Kennedy. "Our business
is performing well, and we are confident that we can emerge from
this process stronger than ever, as this path is a reflection of
our debt structure, not the strength of our operations or business
model. Pursuing restructuring through chapter 11 will enable us to
reduce Avaya's debt and interest expense, while providing increased
financial flexibility to further invest in innovation and growth to
enhance our market-leading competitive position. Most importantly,
we are keenly focused on minimizing disruption to our customers,
partners, and employees and do not expect to experience any
material disruptions during the chapter 11 cases."
Business as Usual
Contemporaneously with the filing of the voluntary petitions, the
Company filed a number of "first-day" motions with the Court to
facilitate a smooth transition into chapter 11 and minimize
business disruption. Among other things, the motions request
authorization to continue certain customer and partner programs,
and to honor certain employee compensation and benefit obligations.
The Debtors also sought joint administration of their chapter 11
cases under the caption In re Avaya Inc., et al., Case No. 17-10088
(Bankr. S.D.N.Y.). The debtor affiliates are Avaya CALA Inc.,
Avaya EMEA Ltd., Avaya Federal Solutions, Inc., Avaya Holdings
Corp., Avaya Holdings LLC, Avaya Holdings Two, LLC, Avaya
Integrated Cabinet Solutions Inc., Avaya Management Services Inc.,
Avaya Services Inc., Avaya World Services Inc., Octel
Communications LLC, Sierra Asia Pacific Inc., Sierra Communication
International LLC, Technology Corporation of America, Inc.,
Ubiquity Software Corporation, VPNet Technologies, Inc., and Zang,
Inc.
Centerview Partners and Zolfo Cooper are the Company's financial
and restructuring advisors, Goldman Sachs is the Company's M&A
investment banker and Kirkland & Ellis LLP is the Company's
restructuring counsel.
About Avaya
Avaya Inc. -- http://www.avaya.com/-- provides a portfolio of
software and services for contact center and unified communications
with integrated, secure networking -- offered on premises, in the
cloud, or a hybrid.
AVAYA INC: Foreign Units Obtain Forbearance from Citi, Lenders
--------------------------------------------------------------
Avaya Canada Corp., as Canadian borrower, Avaya UK, as U.K.
borrower, Avaya International Sales Limited, as Irish borrower,
Avaya Deutschland GmbH and Avaya GmbH & Co. KG, as German
borrowers, Avaya UK Holdings Limited, as U.K. guarantor, Avaya
Holdings Limited, as Irish guarantor, Avaya Germany GmbH, Tenovis
Telecom Frankfurt GmbH & Co. KG, and Avaya Verwaltungs GmbH, as
German guarantors, the Subsidiary Guarantors, as guarantors,
Citibank, N.A., as administrative agent (in such capacity, the
"Foreign ABL Agent"), Citibank N.A., Canadian Branch, as Canadian
swing line lender, Citibank N.A., London, as European swing line
lender, and the lenders that are parties thereto from time to time
under the revolving credit facility, completed on January 19, 2017,
the execution and delivery of a Forbearance Agreement pursuant to
which, among other things, the Foreign ABL Lenders agreed to
forbear from exercising certain rights as a result of the
occurrence of certain events of default under the revolving credit
facility of Avaya Inc.
A copy of the Forbearance Agreement is available at
https://is.gd/yUeq6I
The events of default for which the Foreign ABL Lenders agreed to
forbear relate to the Company and certain of its affiliates filing
voluntary petitions for relief under the Bankruptcy Code. The
Forbearance Agreement also provides for, among other things, entry
into a payoff letter which contemplates that all loans and other
obligations that are accrued and payable under the Foreign ABL
Agreement and the corresponding loan documents have been paid in
full within eight business days after January 19, 2017.
According to Avaya, the filing of the Bankruptcy Petitions
constituted an event of default that accelerated the payment of the
Company's obligations including revolving credit facility
borrowings and term loans of:
(i) approximately $55 million of principal and $44.4 million
of letters of credit under the Credit Agreement, dated as of
October 26, 2007, as amended as of August 8, 2011, by Amendment No.
1, as amended and restated as of October 29, 2012, pursuant to the
Amendment Agreement, as amended as of February 13, 2013, by
Amendment No. 3 and as further amended as of June 4, 2014, by
Amendment No. 4 (as amended, amended and restated, supplemented or
otherwise modified from time to time prior to the date hereof, the
"Domestic ABL Credit Agreement") among the Company, the subsidiary
borrowers from time to time party thereto, Avaya Holdings, Corp., a
Delaware corporation, Citicorp USA, Inc., as administrative agent,
each lender from time to time party thereto and the other parties
from time to time party thereto and
(ii) approximately $3,235 million under the Third Amended and
Restated Credit Agreement, dated as of December 21, 2012, as
amended as of February 13, 2013, by Amendment No. 6, March 12,
2013, by Amendment No. 7, February 5, 2014, by Amendment No. 8 and
May 29, 2015, by Amendment No. 9 (as amended, amended and restated,
supplemented or otherwise modified from time to time prior to the
date hereof, the "Cash Flow Credit Agreement") among the Company,
Avaya Holdings Corp., a Delaware corporation, Citibank, N.A., as
administrative agent, swing line lender and L/C issuer and each
lender from time to time party thereto.
Each Credit Agreement provides that as a result of the Bankruptcy
Petitions, the principal and interest due thereunder shall be
immediately due and payable. However, any efforts to enforce such
payment obligations under either Credit Agreement are automatically
stayed as a result of the Bankruptcy Petitions, and the creditors'
rights of enforcement in respect of either Credit Agreement are
subject to the applicable provisions of the Bankruptcy Code and
orders of the Bankruptcy Court.
The filing of the Bankruptcy Petitions also constituted an event of
default that terminated all commitments of the lenders under the
Credit Agreement, dated as of June 4, 2015 (as amended, amended and
restated, supplemented or otherwise modified from time to time
prior to the date hereof, the "Foreign ABL Credit Agreement") among
Avaya Canada Corp., an unlimited liability company organized under
the laws of the province of Nova Scotia (the "Canadian Borrower"),
Avaya UK, a company incorporated under the laws of England and
Wales (the "U.K. Borrower"), Avaya International Sales Limited, a
limited liability company incorporated under the laws of Ireland
(the "Irish Borrower"), Avaya Deutschland GMBH, a limited liability
company (Gesellschaft mit beschrankter Haftung) existing under the
laws of Germany ("Avaya Deutschland"), Avaya GMBH & CO. KG, a
limited partnership (GmbH & Co. KG) existing under the laws of
Germany ("Avaya KG", and together with Avaya Deutschland, the
"German Borrowers", and the German Borrowers together with the U.K.
Borrower, the Irish Borrower and the Canadian Borrower, the
"Borrowers"), the foreign guarantors from time to time party
thereto, Citibank, N.A., as administrative agent, each lender from
time to time party thereto and the other parties from time to time
party thereto.
The filing of the Bankruptcy Petitions constitutes an event of
default that accelerated the Company's obligations under the
Company's (i) 10.50% Senior Secured Notes due 2021, issued pursuant
to the Indenture, dated as of March 7, 2013, between the Company,
the guarantors party thereto and The Bank of New York Mellon Trust
Company, N.A., as trustee and notes collateral agent (the "2013
Indenture"), (ii) 9.00% Senior Secured Notes due 2019, issued
pursuant to the Indenture, dated as of December 21, 2012, between
the Company, the guarantors party thereto and The Bank of New York
Mellon Trust Company, N.A., as trustee and notes collateral agent
(the "2012 Indenture"), and (iii) 7.00% Senior Secured Notes due
2019, issued pursuant to the Indenture, dated as of February 11,
2011, between the Company, the guarantors party thereto and The
Bank of New York Mellon Trust Company, N.A., as trustee and notes
collateral agent.
The Indentures provide that as a result of the Bankruptcy
Petitions, all unpaid principal and interest due thereunder shall
be immediately due and payable. Any efforts to enforce such payment
obligations under the Indentures are automatically stayed as a
result of the Bankruptcy Petitions, and the creditors' rights of
enforcement in respect of the Indentures are subject to the
applicable provisions of the Bankruptcy Code.
About Avaya
Avaya Inc. -- http://www.avaya.com/-- provides a portfolio of
software and services for contact center and unified communications
with integrated, secure networking -- offered on premises, in the
cloud, or a hybrid.
AVAYA INC: Reports Q4 and Fiscal Year 2016 Financial Results
------------------------------------------------------------
Avaya Inc. reported a net loss of $505 million on $958 million of
revenue for the three months ended Sept. 30, 2016, compared to a
net loss of $76 million on $1 billion of revenue for the three
months ended Sept. 30, 2015.
For the fiscal year ended Sept. 30, 2016, the Company reported a
net loss of $750 million on $3.70 billion of revenue compared to a
net loss of $144 million on $4.08 billion of revenue for the fiscal
year ended Sept. 30, 2015.
Total revenue for the fourth quarter was $958 million, up $76
million compared to the prior quarter as demand improved for
products and services, and decreased $50 million year-over-year,
due to lower demand for unified communications hardware. GAAP
gross margin was 60.9% for the fourth quarter. Non-GAAP gross
margin was 61.8%, which compares to 62.4% for the prior quarter and
62.0% for the fourth quarter of 2015. GAAP operating loss was $428
million, reflecting $542 million of impairment of goodwill and
intangibles. Non-GAAP operating income was $229 million which
compares to $180 million for the prior quarter and $202 million for
the fourth quarter of fiscal 2015. For the quarter, adjusted
EBITDA was $284 million or 29.6% of revenue, which compares to
adjusted EBITDA of $223 million or 25.3% for the prior quarter, and
$246 million or 24.4% for the fourth quarter of fiscal 2015.
For fiscal 2016, Avaya reported revenue of $3,702 million, down 9%
compared to fiscal 2015, or down 8% in constant currency. GAAP
gross margin for fiscal 2016 was 60.6%. Non-GAAP gross margin was
a record 61.5%. GAAP operating loss was $262 million, reflecting
$542 million of impairment of goodwill and intangibles. Non-GAAP
operating income was $756 million in fiscal 2016 compared to $718
million in fiscal 2015. Fiscal 2016 adjusted EBITDA of $940
million represented a record 25.4% of revenue, and was $40 million
higher compared to fiscal 2015. Cash flow from operations was $113
million and free cash flow was $17 million for fiscal year 2016,
reflecting one-time payments of approximately $82 million for a
legal settlement and advisory fees. Cash and cash equivalents
totaled $336 million as of Sept. 30, 2016, an increase of $67
million from the prior quarter and up $13 million from fourth
quarter 2015.
As of Sept. 30, 2016, Avaya Inc. had $5.82 billion in total assets,
$10.24 billion in total liabilities and a total stockholders'
deficiency of $4.42 million.
"Avaya's fourth fiscal quarter results reflect the strength of our
technology portfolio, with major competitive wins at government
agencies and enterprise customers across networking, contact center
and private cloud services underpinned by continued transformation
of the company to a superior operating model," said Kevin Kennedy,
president and CEO.
"Revenue and adjusted EBITDA exceeded the high end of our
preliminary stated range," continued Mr. Kennedy. "In constant
currency, contact center and networking revenue increased double
digit percentages from both the prior quarter and year-over-year,
while unified communications products declined year-over-year and
grew sequentially. Non-GAAP operating income as a percentage of
revenue and adjusted EBITDA as a percentage of revenue reached new
records for the company for both the quarter and full year 2016
driven by lower operating expenses. Our strategic roadmap is being
well received as customers are upgrading to our newest platforms
due to our industry leadership position and outstanding customer
service as witnessed by Avaya's fourth quarter Net Promoter Score
of 58. As mentioned in our press release today, the decision to
restructure through a chapter 11 process reflects the company's
debt structure, as opposed to the strength of Avaya's operations
and business model. Looking forward, we remain committed to
improving our operating performance and capital structure while
creating value for our customers."
A full-text copy of the press release is available for free at:
https://is.gd/yh8ezI
About Avaya
Santa Clara, California-based Avaya Inc. -- http://www.avaya.com/
-- helps to tie the corporate world together. The company's
communication equipment and software integrate voice and data
services for customers including large corporations, government
agencies, and small businesses. Its office phone systems
incorporate Internet protocol (IP) and Session Initiation protocol
(SIP) telephony, messaging, Web access, and interactive voice
response. Avaya also offers consulting, integration, and other
managed IT services. The company sells directly and through
distributors, resellers, systems integrators, and
telecommunications service providers; more than three-quarters of
its sales are made indirectly. Its parent company is Avaya
Holdings.
* * *
In April 2016, Standard & Poor's Ratings Services owered its
corporate credit rating on Avaya Inc. to 'CCC' from 'B-'.
In August 2016, Moody's Investors Service downgraded Avaya, Inc.'s
Corporate Family Rating to 'Caa2' from 'Caa1'. The 'Caa2'
Corporate Family Rating reflects Avaya's very high leverage
(approximately 9x as of June 30, 2016) and concerns about the
sustainability of the capital structure including its ability to
refinance 2017/2018 debt maturities and the likelihood of a near
term restructuring.
AVAYA INC: S&P Lowers CCR to 'D' on Voluntary Ch. 11 Petition
-------------------------------------------------------------
S&P Global Ratings said it lowered its corporate credit rating on
Santa Clara, Calif.-based Avaya Inc. to 'D' from 'CCC.
Avaya filed voluntary petitions for relief under Chapter 11 of the
U.S. Bankruptcy Code on Jan. 19, 2017.
At the same time, S&P lowered its issue-level rating on the
company's senior secured (second priority) term loans and notes to
'D' from 'CCC+'. The '2' recovery rating is unchanged, indicating
S&P's expectation for substantial recovery (70%-90%; lower half of
the range) of principal for debtholders in the event of a payment
default.
S&P also lowered its issue-level rating on Avaya's second-lien
(third priority) notes to 'D' from 'CCC-'. The '5' recovery rating
is unchanged, indicating S&P's expectation for modest recovery
(10%-30%; lower half of the range) of principal for the debtholders
in the event of a payment default.
"The 'D' rating reflects Avaya Inc.'s Chapter 11 bankruptcy
filing," said S&P Global Ratings credit analyst John Moore.
Avaya plans to continue to operate while it develops a
reorganization plan and expects that it will emerge from bankruptcy
later in 2017.
AVERY LAND: Plan Filing Period Extended Through March 23
--------------------------------------------------------
Judge August B. Landis of the U.S. Bankruptcy Court for the
District of Nevada extended the periods during which only Avery
Land Group, LLC may file a chapter 11 plan and solicit acceptances
to such plan, through March 23, 2017 and May 22, 2017,
respectively.
The Troubled Company Reporter had earlier reported that the Debtor
sought for an exclusivity extension contending that only until the
deadline for filing proofs of claim has passed on Jan. 11, 2017 and
the results of the Utica and Tiger auction sales are known will the
Debtor be in a position to meaningfully assess how far down the
waterfall the equity cushion realized by said sales goes and by how
much it needs to augment that realized cushion by various other
plan funding devices, rather than awaiting a confirmation order for
approval thereof as means of plan execution.
The Debtor also related that its Motion for Order Authorizing Sale
of Equipment Subject to Master Lease Agreement With Utica Leaseco,
LLC had been set for hearing on January 4, 2017. The Debtor
further relates that its Application to Employ and Compensate Tiger
Capital Group, LLC and Rabin Worldwide, Inc., as Auctioneers and
Motion for Order Authorizing Sale of Equipment and Related Assets
had been set for hearing on December 29, 2016.
About Avery Land Group, LLC
Avery Land Group, LLC, based in Las Vegas, NV, filed a Chapter 11
petition (Bankr. D. Nev. Case No. 16-14995) on Sept. 9, 2016. The
case is assigned to Judge August B. Landis. The Debtor estimated
assets at $500,000 to $1 million and liabilities at $1 million to
$10 million. The petition was signed by James M. Rhodes, manager.
The Debtor is represented by Brett A. Axelrod, Esq., at Fox
Rothschild, LLP. The Debtor has retained Anne M. Loraditch, Esq.,
at The Bach Law Firm, LLC as conflicts counsel.
No official committee of unsecured creditors has been appointed in
the case.
AZTUC LLC: Seeks to Hire Eric Ollason as Legal Counsel
------------------------------------------------------
AZTUC, LLC seeks approval from the U.S. Bankruptcy Court for the
District of Arizona to hire legal counsel in connection with its
Chapter 11 case.
The Debtor proposes to hire the Law Office of Eric Ollason to give
legal advice regarding its duties under the Bankruptcy Code,
negotiate with creditors, assist in the preparation of a bankruptcy
plan, and provide other legal services.
Eric Ollason, Esq., has received a pre-bankruptcy retainer from the
Debtor in the sum of $5,033. He will be paid on an hourly basis
for his services and will receive reimbursement for work-related
expenses.
Mr. Ollason maintains an office at:
Eric Ollason, Esq.
Law Office of Eric Ollason
182 North Court
Tucson, AZ 85701
Tel: (520) 791-2707
About AZTUC LLC
AZTUC, LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Ariz. Case No. 17-00376) on January 13, 2017. At
the time of the filing, the Debtor estimated assets and liabilities
of less than $100,000.
AZURE MIDSTREAM: Waiver Pact Requires Sale of Assets by Jan. 30
---------------------------------------------------------------
Azure Midstream Partners, LP, entered into a Limited Duration
Waiver Agreement to its revolving credit facility, as amended, with
Wells Fargo Bank, National Association, as administrative agent and
other lenders, on Jan. 13, 2017.
The terms of the Limited Duration Waiver Agreement extend the
waiver of certain covenant defaults until Jan. 30, 2017. Borrowing
capacity under the Credit Agreement continues to be $173.7 million.
The Limited Duration Waiver Agreement also requires the
Partnership to enter into an agreement with respect to the sale of
the Partnership and its assets no later than Jan. 30, 2017.
About Azure Midstream
Azure Midstream Partners, LP, is a publicly traded Delaware master
limited partnership that was formed by NuDevco Partners, LLC and
its affiliates to develop, own, operate and acquire midstream
energy assets. The Company currently offers: (i) natural gas
gathering, compression, dehydration, treating, processing, and
hydrocarbon dew-point control and transportation services to
producers, marketers and third-party pipeline companies through the
Company's gathering and processing business segment; and (ii) crude
oil logistics services to Associated Energy Services, LP, an
affiliate, through its logistics business segment.
Azure reported a net loss of $222.42 million for the year ended
Dec. 31, 2015, compared to a net loss of $6.82 million for the year
ended Dec. 31, 2014.
As of Sept. 30, 2016, the Company had $375.5 million in total
assets, $179.4 million in total liabilities and $196.2 million in
total partners' capital.
KPMG LLP, in Dallas, Texas, issued a "going concern" qualification
on the consolidated financial statements for the year ended
Dec. 31, 2015, citing that the Partnership anticipates being out of
compliance with the requirements in the Credit Agreement during
2016, which would accelerate the maturity of the outstanding
indebtedness making it currently due and payable. The Partnership
does not have sufficient liquidity to meet the accelerated debt
service requirements. This issue raises substantial doubt about
its ability to continue as a going concern, the auditors said.
* * *
In September 2016, S&P Global Ratings lowered its corporate credit
rating on Azure Midstream Energy LLC to 'CCC+' from 'B-'. "The
downgrade reflects our view that Azure's credit measures have
worsened due to unfavorable commodity prices and weak industry
conditions, which has made it more challenging to meet its
financial commitments," S&P Global Ratings analyst Mike Llanos
said.
In August 2016, Moody's Investors Service downgraded Azure
Midstream Energy's Corporate Family Rating (CFR) to 'Caa2' from
'B3', Probability of Default Rating (PDR) to 'Caa2-PD' from
'Caa1-PD', senior secured term loan rating to 'Caa2' from 'B3', and
the senior secured revolving credit facility rating to 'B1' from
'Ba3'. The Speculative Grade Liquidity rating was withdrawn. The
outlook remains negative.
BAKERSFIELD TEMPLE: Taps Klein DeNatale as Legal Counsel
--------------------------------------------------------
Bakersfield Temple of the Church of God in Christ, Inc. seeks
approval from the U.S. Bankruptcy Court for the Eastern District of
California to hire legal counsel in connection with its Chapter 11
case.
The Debtor proposes to hire Klein, DeNatale, Goldner, Cooper,
Rosenlieb & Kimball, LLP to give legal advice regarding its duties
under the Bankruptcy Code, assist in the preparation of a
bankruptcy plan, and provide other legal services.
The firm estimates that its fees will be at least $50,000.
Klein DeNatale does not hold any interest adverse to the Debtor,
according to court filings.
The firm can be reached through:
Hagop T. Bedoyan, Esq.
Jacob L. Eaton, Esq.
Lisa A. Holder, Esq.
Klein, DeNatale, Goldner, Cooper
Rosenlieb & Kimball, LLP
5260 N. Palm Avenue, Suite 201
Fresno, CA 93704
Tel: (559) 438-4374
Fax: (559) 432-1847
Email: hbedoyan@kleinlaw.com
Email: jeaton@kleinlaw.com
Email: lholder@kleinlaw.com
About Bakersfield Temple
Bakersfield Temple of the Church of God in Christ, Inc. sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.
Cal. Case No. 17-10014) on January 3, 2017. The petition was
signed by Derrick Dickerson, Chairman of Board of Trustees.
At the time of the filing, the Debtor estimated assets of less than
$1 million and liabilities of less than $500,000.
BARTELLO PROPERTIES: U.S. Trustee Unable to Appoint Committee
-------------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Bartello Properties, LLC, as of
Jan. 19, according to a court docket.
About Bartello Properties
Bartello Properties, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Nev. Case No. 16-15861) on Nov. 1, 2016.
The petition was signed by Vincent Bartello, manager.
The case is assigned to Judge Bruce T. Beesley. Mincin Law PLLC
serves as bankruptcy counsel to the Debtor.
At the time of the filing, the Debtor disclosed $1.70 million in
assets and $884,437 in liabilities.
BEEKMAN LIQUORS: Sale of All Assets to Kwon for $325,000 Approved
-----------------------------------------------------------------
Judge Martin Glenn of the U.S. Bankruptcy Court for the Southern
District of New York authorized Beekman Liquors, Inc.'s private
sale of substantially all of its assets to Angela Kwon for
$325,000, plus the cost of the alcoholic beverage inventory.
Hearings on the Motion were conducted on Nov. 29, 2016 and Jan. 10,
2017.
The sale is free and clear of all liens, claims and encumbrances.
Kwon may assign all rights and interests as Purchaser under the
Sale Agreement to a corporation or LLC, of which she will be a
shareholder, officer and director or member, as provided for in the
Sale Agreement, and, in such event, the deposit of Kwon may be
credited to said corporation or LLC.
The Debtor is authorized to assume and assign the Lease for the
Premises to the Purchaser, at the closing of the Sale Agreement,
under section 365 of the Bankruptcy Code.
The Debtor is authorized to satisfy, at the closing of the Sale
Agreement, from the proceeds of the sale, (i) all closing and
closing related charges, including the broker's commission to Isa
Realty Group, LLC, (ii) the outstanding first priority secured
claim to American Express Bank, FSB; (iii) the outstanding second
priority secured claim to New York State Department of Tax and
Finance; (iii) the outstanding third priority secured claim to
Merchant Cash & Capital, LLC; and (iv) the pre-petition claim of
the Landlord, 277 Park Avenue, LLC, in connection with the
assumption and assignment of the Lease in accordance with the Sale
Agreement, as provided for in more detail in the Motion; provided,
that any amount of the foregoing that is the subject of a good
faith dispute shall be held in an attorney’s escrow (including an
escrow with the Debtor's attorney, Alter & Brescia, LLP or the
Debtor's special counsel, Mehler & Buscemi, Esqs.) subject to the
parties' agreement or further order of the Court, without any
limitation on the parties' ability to close the proposed sale and
the Debtor's ability to sell transfer, convey and/ or assign the
Assets to the Purchaser or her assignee under the Sale
Agreement.
Notwithstanding approval of the Sale Agreement, the Debtor has the
contractual right to continue to market the Assets, and, in the
event the Debtor obtains a higher and better offer as determined by
the Court prior to the closing under the Sale Agreement, the
Purchaser's sole claim in this case will be for the breakup fee set
forth in the Sale Agreement.
The 14-day stay of this Order under Bankruptcy Rule 6004(h) is
waived for cause, and the Order is effective immediately upon its
entry.
About Beekman Liquors
Beekman Liquors, Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 16-11370) on May 13,
2016. The petition was signed by David Frieser, president. The
case is assigned to Judge Martin Glenn. The Debtor estimated
assets of $500,000 to $1 million and
debts of $1 million to $10 million.
Beekman Liquors has employed Alter & Brescia LLP as its legal
counsel; Mehler & Buscemi as special counsel; Steven Sundack
C.P.A.
P.C. as accountant; and New York New Star Realty Inc. as broker in
connection with a potential sale of the Debtor's assets.
BELK INC: Bank Debt Trades at 15% Off
-------------------------------------
Participations in a syndicated loan under BELK, Inc is a borrower
traded in the secondary market at 85.13 cents-on-the-dollar during
the week ended Friday, January 13, 2017, according to data compiled
by LSTA/Thomson Reuters MTM Pricing. This represents a decrease of
0.93 percentage points from the previous week. BELK, Inc. pays 450
basis points above LIBOR to borrow under the $1.5 billion facility.
The bank loan matures on Nov. 19, 2022 and carries Moody's B2
rating and Standard & Poor's B rating. The loan is one of the
biggest gainers and losers among 247 widely quoted syndicated loans
with five or more bids in secondary trading for the week ended
January 13.
BENEVOLENT HOSPICE: Taps Hervol Law as Counsel
----------------------------------------------
Benevolent Hospice, LLC seeks approval from the U.S. Bankruptcy
Court for the Western District of Texas, San Antonio Division, to
employ H. Anthony Hervol as its attorney.
The professional services H. Anthony Hervol is to perform are:
a. To represent the Debtor in this Chapter 11 case and to
advise the Debtor as to its right, powers and duties as
debtor-in-possession;
b. To prepare all necessary statements, schedules and other
documents and to negotiate and prepare one or more plans of
reorganization for the Debtor;
c. To represent the Debtor at all hearings, meetings of
creditors, conferences, trials and other proceedings in this case;
d. To take necessary action to collect property of the estate
and file suits to recover the same, or pursue other adversary
proceedings as needed;
e. To prepare on behalf of Debtor all necessary applications,
answers, orders, reports and other legal papers;
f. To object to disputed claims; and
g. To perform all other legal services for the Debtor as
Debtor in possession which may be necessary.
Payment for the professional services rendered are at the rate of
$285.00 per hour, to be applied against a retainer of $15,000.00
for pre-petition and post-petition services, along with a deposit
of $1,717.00 for costs and filing fees.
H. Anthony Hervol, Esq. attests that he is a disinterested person
within the meaning of Sections 101(14) and 327 of the Bankruptcy
Code.
The Firm can be reached through:
H. Anthony Hervol, Esq.
LAW OFFICE OF H. ANTHONY HERVOL
4414 Centerview Road, Suite 200
San Antonio, TX 78238
Tel: (210) 522-9500
Fax: (210) 522-0205
Email: hervol@sbcglobal.net
About Benevolent Hospice
Benevolent Hospice, LLC, of San Antonio, TX, filed a voluntary
petition under Chapter 11 of the United States Bankruptcy Court
(Bankr. W.D. Tex. Case No. 16-52996) on December 30, 2016. The
petition was signed by James F. Thomas, Jr., CEO. The case is
assigned to Judge Craig A. Gargotta.
At the time of the filing, the Debtor estimated its assets at
$50,000 and debts at $1 million to $10 million.
BENNU TITAN: Ch.11 Trustee Wants Parent's Cases Moved to Del.
-------------------------------------------------------------
Vince Sullivan, writing for Bankruptcy Law360, reported that the
Chapter 11 trustee in the case of Bennu Titan LLC told a Delaware
bankruptcy judge that the liquidation cases of Bennu Titan's parent
company should be transferred to Delaware from Texas in the
interest of justice and judicial economy. During a hearing in
Wilmington, trustee attorney William Sullivan, Esq., at Sullivan
Hazeltine & Allinson LLC told the court that it makes sense to
bring the Chapter 7 cases of Bennu Oil & Gas and its affiliates to
Delaware.
In an earlier report, Bankruptcy Law360's Mr. Sullivan said the
Chapter 11 trustee pointed out that Bennu Titan's case was filed
first.
Wilmington Trust, National Association, Sojitz Energy Venture,
Inc., Hornbeck Offshore Services, LLC, Harvey Gulf International
Marine, LLC, have objected to the Trustee's request to transfer
venue of the Chapter 7 cases.
Bennu Oil & Gas, LLC and affiliates filed voluntary Chapter 7
petitions (Bankr. S.D. Tex. Case No. 16-35930) on Nov. 30, 2016.
The Hon. David R. Jones presides over the case. The Chapter 7
Trustee is:
Janet S Casciato-Northrup
Hughes Watters and Askanase
1201 Louisiana 28th Floor
Houston, TX 77002
Jess Krochtengel, writing for Bankruptcy Law360, reported that
Bennu Oil and Gas, a 3-year-old company focused on offshore
production in the Gulf of Mexico, said in court filings it has
about $32.5 million in assets, and a total of $727 million in
liabilities. The bulk of that -- $495 million -- is owed to
creditors whose claims are secured by property, it said. There's
also less than $300,000 in priority unsecured claims and about $229
million in non-priority unsecured claims.
About Bennu Titan LLC
Bennu Titan LLC, formerly known as ATP Titan LLC, is part of a
business enterprise engaged in the acquisition, exploration,
development, and production of oil and natural gas properties in
the Gulf of Mexico. It is a limited liability company formed in
May 2010 as a special purpose vehicle with one member, Bennu Titan
Holdco LLC. Bennu Holdco has one member, Bennu Oil & Gas, LLC
("Bennu O&G"); and Bennu O&G has one member, Bennu Holdings, LLC
("Bennu Holdings").
Bennu Titan owns a multi-column, deep draft, floating drilling and
production platform commonly known as Titan as well as two oil
and
gas export pipelines and related rights of way.
Beal Bank USA and CLMG Corp. filed an involuntary Chapter 11
petition against Texas-based offshore drilling firm Bennu Titan
LLC
f/k/a ATP Titan LLC (Bankr. D. Del. Case No. 16-11870) on Aug. 11,
2016. The court entered an order for relief on Sept. 9, 2016.
The Debtor is represented by William P. Bowden, Esq., at Ashby &
Geddes, P.A. The petitioning creditors are represented by Michael
J. Farnan, Esq., and Joseph J. Farnan, Esq., at Farnan LLP and
Thomas E. Lauria, Esq., at White & Case LLP.
On Nov. 21, 2016, the U.S. Trustee nominated Gerald H. Schiff to
serve as the Chapter 11 Trustee and moved for an order approving
his appointment. On Nov. 23, 2016, the Court entered an order
approving Mr. Schiff's appointment.
The Chapter 11 Trustee tapped Sullivan Hazeltine Allison LLC and
Kelly Hart Pitre as bankruptcy counsel, and Gordon, Arata,
McCollam, Duplantis & Eagan, LLC as special regulatory and oil and
gas counsel.
No official committee of unsecured creditors has been appointed.
BILL BARRETT: JPMorgan Chase Reports 6.4% Stake as of Dec. 30
-------------------------------------------------------------
In an amended Schedule 13G filed with the Securities and Exchange
Commission, JPMorgan Chase & Co. disclosed that as of Dec. 30,
2016, it beneficially owns 4,782,520 shares of common stock of Bill
Barrett Corporation representing 6.4 percent of the shares
outstanding. A full-text copy of the regulatory filing is
available for free at https://is.gd/T8v9OB
About Bill Barrett
Denver-based Bill Barrett Corporation is an independent energy
company that develops, acquires and explores for oil and natural
gas resources. All of the Company's assets and operations are
located in the Rocky Mountain region of the United States.
Bill Barrett reported a net loss of $488 million in 2015 following
net income of $15.08 million in 2014.
As of Sept. 30, 2016, Bill Barrett had $1.33 billion in total
assets, $826.4 million in total liabilities and $509.2 million in
total stockholders' equity.
* * *
In June 2016, Moody's Investors Service affirmed Bill Barrett
Corporation's 'Caa2' Corporate Family Rating and revised the
Probability of Default Rating to 'Caa2-PD/LD' from 'Caa2-PD.'
"Bill Barrett's debt for equity exchange achieved some reduction in
its overall debt burden, but the company's cash flow and leverage
metrics continue to remain challenged as its hedges roll off in
2017," commented Amol Joshi, Moody's vice president.
In July 2016, S&P Global Ratings raised the corporate credit rating
on Bill Barrett to 'B-' from 'SD'. The rating outlook is negative.
"The upgrade reflects our reassessment of the company's corporate
credit rating following the debt-for-equity exchange of its 7.625%
senior unsecured notes due 2019, and also reflects our expectation
that there will be no further distressed exchanges over the next 12
months," said S&P Global Ratings credit analyst Kevin Kwok.
BJORNER ENTERPRISES: Unsecureds to be Paid in Full in One Year
--------------------------------------------------------------
Bjorner Enterprises, Inc., said in its latest disclosure statement
that all payments on general unsecured claims will be paid in full
no later than one year from the effective date of its Chapter 11
plan.
The initial disclosure statement proposed to pay dividends on
unsecured claims in semi-annual installments commencing six months
from the effective date of the plan. It also disclosed that
unsecured claims will be paid in full in three years.
According to the latest document, the company's management is given
until July 1 to obtain a bona fide offer to purchase the property
located along Madrona Avenue, St. Helena, California, at a price
sufficient to pay all creditors in full, and another 60 days to
close the deal.
If Bjorner fails to meet either of those milestones, a liquidating
trustee will be appointed to assume complete control of the
marketing. The trustee will be given another six months to close a
sale.
Pending payoff, creditor claims will continue to accrue interest,
according to the disclosure statement filed on Jan. 12 with the
U.S. Bankruptcy Court for the Northern District of California.
A copy of the latest disclosure statement is available for free
at:
https://is.gd/Zburus
About Bjorner Enterprises
Bjorner Enterprises, Inc. is a longstanding California corporation
organized in 1976 and wholly owned by John Bjorner. It was
formerly involved in diversified business activities including the
operation of an electrical supply business, the operation of a
chain of natural foods retail stores, and the ownership of
investment real estate. As of the filing of the petition for
relief, all of these business activities were terminated with the
exception of the ownership of a luxury estate parcel located at
2535 Madrona Avenue, St. Helena, California. In conjunction with
an adjacent parcel known as 2509 Madrona Ave owned by Mr. Bjorner
personally, the Madrona Property generates substantial income as a
vacation rental.
The Debtor filed a Chapter 11 petition (Bankr. N.D. Cal. Case No,
16-10637) on July 26, 2016. The petition was signed by John
Bjorner, president. The Debtor is represented by John H.
MacConaghy, Esq., at MacConaghy & Barnier, PLC. The case is
assigned to Judge Alan Jaroslovsky. The Debtor estimated assets
and debts at $1 million to $10 million at the time of the filing.
BONANZA CREEK: Gets 'Unsolicited' Inquiry From Bill Barrett
-----------------------------------------------------------
Bonanza Creek Energy, Inc., announced that it received an
unsolicited inquiry from Bill Barrett Corporation regarding a
potential transaction between the Company and Bill Barrett.
The Company said that from time to time, it receives unsolicited
inquiries from third parties regarding potential transactions
involving or relating to the Company's assets.
Following the Company and its subsidiaries' commencement of Chapter
11 bankruptcy cases, and the announcement of its prepackaged plan
of reorganization, the Company anticipated that it might receive
additional, similar unsolicited inquiries during the pendency of
the Chapter 11 cases.
Consistent with the Company's obligations as a debtor-in-
possession in the Chapter 11 cases, the Company agreed to review
the potential transaction proposed by Bill Barrett in its
unsolicited inquiry and entered into a confidentiality agreement
with Bill Barrett on Jan. 16, 2017.
On Jan. 17, 2017, Bill Barrett disclosed the existence of, and the
fact that the Company entered into, the Confidentiality Agreement
in a Form 8-K filed with the SEC. The Company said it was given no
prior notice that Bill Barrett intended to file the Bill Barrett
Form 8-K, and the Company views the filing of the Bill Barrett Form
8-K as a violation of the terms of the Confidentiality Agreement.
In keeping with the agreement it made with Bill Barrett pursuant to
the Confidentiality Agreement, the Company does not intend to
publicly comment further on this matter at this time, and no party
should presume that the Company's failure to comment further on
this matter is an indication of the Company's position with respect
to the unsolicited inquiry it received from Bill Barrett.
About Bonanza Creek Energy
Bonanza Creek Energy, Inc. (NYSE: BCEI) --
http://www.bonanzacrk.com/-- is an independent oil and natural gas
company engaged in the acquisition, exploration, development and
production of onshore oil and associated liquids-rich natural gas
in the U.S. The Company's assets and operations are concentrated
primarily in the Rocky Mountain region in the Wattenberg Field,
focused on the Niobrara and Codell formations, and in southern
Arkansas, focused on oily Cotton Valley sands.
On Jan. 4, 2017, Bonanza Creek Energy, Inc., and six affiliated
debtors each filed a voluntary petition for relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case No. Case
No. 17-10015). The cases are pending before the Hon. Kevin J.
Carey, and the Debtors have requested joint administration of the
cases.
Davis, Polk & Wardwell LLP is acting as legal counsel, Richards,
Layton & Finger, P.A., is acting as co-counsel, Perella Weinberg
Partners LP is acting as financial advisor, Alvarez & Marsal LLC is
acting as restructuring advisor and Prime Clerk LLC is acting as
notice, claims and solicitation agent to the Company in connection
with its restructuring efforts.
Kirkland & Ellis LLP serves as legal counsel and Evercore Group
L.L.C. serves as financial advisor to the ad hoc committee of
holders of the Senior Notes.
BUMI RESOURCES: Seeks Ch.15 Recognition of Indonesian Case
----------------------------------------------------------
Martin O'Sullivan, writing for Bankruptcy Law360, reported that PT
Bumi Resources Tbk, an Indonesian coal miner, petitioned a
Manhattan bankruptcy court for Chapter 15 recognition to stop
bondholders from potentially disrupting its efforts to reorganize
$4.2 billion in debt in Indonesian courts.
Bumi in January 2015 was granted Chapter 15 protection in New York
for restructuring proceedings in Singaporean court following a
series of debt defaults, but those cases were discontinued in 2016.
According to the report, Bumi Chief Financial Officer Andrew C.
Beckham on Friday said that the company had entered similar
proceedings in Indonesia.
CABLE ONE: Moody's Affirms Ba3 CFR & Lowers Notes Rating to B2
--------------------------------------------------------------
Moody's Investors Service affirmed Cable One, Inc.'s (Cable One)
Ba3 corporate family rating (CFR) and Ba3 probability of default
rating (PD) following the company's announcement to acquire
Telecommunications Management, LLC (NewWave) for approximately $735
million, including debt. Moody's also downgraded the company's
unsecured rating to B2 from B1, as the company is expected to raise
a significant amount of secured debt to finance the acquisition,
which will rank ahead of the company's $450 million unsecured
notes. The company's speculative grade liquidity rating is changed
to SGL-1, from SGL-2 .The stable outlook is stable.
Issuer: Cable One, Inc.
Downgrades:
Senior Unsecured Regular Bond/Debenture due 2022, Downgraded to
B2 (LGD5) from B1 (LGD4)
Affirmations:
Probability of Default Rating, Affirmed Ba3-PD
Corporate Family Rating, Affirmed Ba3
Upgrades:
Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2
Outlook Actions:
Outlook, Remains Stable
RATINGS RATIONALE
The proposed transaction by Cable One values NewWave at
approximately 12.3x pre-synergy EBITDA. "We expect leverage to rise
to just over 3x (Moody's adjusted) pro forma for the transaction,
declining to the mid 2 times by the end of 2017. The company
expects to achieve around $25 million in annual cost synergies,
which lowers the acquisition multiple to about 8.7x. We believe the
acquisition makes strategic sense for Cable One as NewWave has
similar penetration levels on its video product, a service offering
Cable One has consciously attempted to move away from. This should
allow Cable One to implement its unique, video-lite business model
to NewWave's existing footprint. We still expect high speed data
and business services to continue to be a growth driver for the
company," Moody's said.
The stable outlook reflects Moody's expectation that Cable One will
grow EBITDA in the low single digit percentage range and maintain
positive free cash flow. Moody's also expects leverage to remain
below 4x (Moody's adjusted). If revenue growth from HSD and
commercial services is not realized, leverage and cash flow targets
necessary to sustain a Ba3 rating would likely be tightened.
Moody's could consider an upgrade is leverage remained comfortably
below 3.0x (Moody's adjusted). An upgrade would also be conditional
on good liquidity. Moody's could be downgraded if leverage is
sustained above 4.0x (Moody's adjusted). A downgrade could also
occur if liquidity were to deteriorate.
Headquartered in Phoenix, AZ, Cable One, Inc. offers traditional
and advanced video services including digital television,
video-on-demand, high-definition television, as well as high-speed
Internet access and phone service. Pro forma for the acquisition of
NewWave, Cable One will have 416 thousand video subscribers, 615
thousand high-speed data subscribers, and 141 thousand telephony
subscribers. Pro forma revenue for the last twelve months ended
September 30 was approximately $1 billion.
CARTER REESE: Selling Sinking Spring Parcels for $960K
------------------------------------------------------
Carter P. and Sarah C. Reese ask the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania to authorize the sale of two
parcels of land in Sinking Spring, Pennsylvania, to Forrest and
Barbara Stricker, and Matthew and Alissa Grove.
A hearing on the Motion is set for Feb. 18, 2017 at 9:30 a.m.
The respondents are: (i) the Commonwealth of Pennsylvania, through
its Department of Agriculture, Bureau of Farmland Preservation ("PA
Bureau"); (ii) the County of Berks, Pennsylvania, through its Berks
County Agricultural Land Preservation Board ("Berks Ag Board");
(iii) PNC Bank, NA; and (iv) Meridian Bank.
The Debtors are the owners of certain real estate known as and
located at 140 Evans Hill Road, Sinking Spring, Pennsylvania, also
known as the Westerly Tract (PIN#: 4387-01-05-1099) containing
approximately 130 acres, approximately 120 of which are subject to
a certain Agricultural Conservation Easement ("Ag Easement") in
favor of Respondents.
The Debtors have proposed a subdivision of the property that will
enable them to sell approximately 76 acres to the current owner of
an adjacent 56 acre parcel recently purchased from the Debtors, as
well as creating two residual lots of approximately 28, Residual
Parcel A, and approximately 31 acres, Residual Parcel B
("Subdivision Plan").
On Sept. 21, 2015, the Board of Supervisors of Lower Heidelberg
Township approved the Subdivision Plan subject to certain
conditions including the requirement that the Berks Ag Board be
provided with the plan. The Berks Ag Board has indicated that the
proposed subdivision and sale of Residual Parcel B will require the
Debtors to remove of 31 acres of hardwood trees and to convert
those acres into tillable crop land in order to meet its current
regulations; and, further indicates that if the Debtors fail to
comply with these regulations, it will not approve the Subdivision
Plan. The regulations relied upon by the Berks Ag Board were
enacted subsequent to the grant of the Ag Easement which
specifically defines crops to include "timber, wood, and other wood
products derived from trees."
The Debtors therefore believe that application of such regulation
to the property constitutes the imposition of an ex post facto law
which improperly and adversely effects the Debtors' interest in the
property and the Debtors therefore dispute the validity and extent
of Respondent PA Bureau and Berks AG Board's interest in the Real
property with respect to the burden that the regulations impose
upon the property.
Debtors have entered into two Agreements of Sale with respect to
the property both of which are contingent upon final approval and
recording of the Subdivision Plan: (i) the sale of the
approximately 76 acres to the Strickers for $760,000; and (ii) the
sale Residual Parcel B to the Groves for $200,000.
Although the Debtors have been able to significantly consummate
their confirmed plan, the Plan has not been fully or substantially
consummated due to the Debtors' inability to pay the administrative
expenses of the estate and to pay certain other secured debt; and,
the Debtors are therefore requesting that their plan be modified to
permit the sale of the real estate parcels identified and thereby
providing for substantial payment of the Debtors' remaining
obligations.
In order to complete the proposed sales pursuant to the confirmed
plan as required by 11 U.S.C. Section 1146(a) and to provide for
said sales free and clear of liens and encumbrances, the Debtors
are requesting that their confirmed plan be modified to permit said
sales subject only to and conditioned upon payment to PNC and
Meridian as well as the other identified creditors.
The property is subject to a first mortgage lien in favor of PNC
with an approximate principal balance of $2,500,000 and a second
mortgage lien in favor of Meridian with an approximate balance of
$308,000.
The fair market value of the residual property after the proposed
sales is estimated to be at least $3,500,000, which value will
adequately protect the residual lien positions of both PNC and
Meridian after the payments provided for.
The pending sales will enable the Debtors to substantially complete
the payments required under the confirmed chapter 11 plan and to
pay all administrative claims, thereby allowing the Debtors to
substantially consummate their confirmed bankruptcy plan, obtain a
final decree and to close the case.
The Debtors asks the Court to (i) modify their confirmed chapter 11
plan and approve the proposed sales as set forth in the Agreements
of Sale; (ii) fnd that the PA Bureau and Berks Ag Board may not use
their recently enacted regulations to require removal of the 31
acres of trees or to otherwise prevent the Debtors from selling the
Real Estate; (iv) provide that a copy of the order granting the
Motion may be recorded in lieu of any approvals by the Berks Ag
Board required in order to record the Subdivision Plan; (v) modify
the Debtors' confirmed chapter 11 plan as provided; (vi) and
approve the sale of the parcels parcels free and clear of the PNC
and Meridian mortgage liens with the proceeds of the sales to be
paid and disbursed in accordance with the proposed disposition of
sale proceeds and the Debtors' confirmed Plan as modified.
A copy of the Agreements of Sale and the proposed disposition of
sale proceeds attached to the Motion is available for free at:
http://bankrupt.com/misc/Carter_Reese_587_Sales.pdf
Matthew and Alissa Grove can be reached at:
Matthew and Alissa Grove
107 Furnace Street
Robesonia, PA 19551
Carter P. Reese and Sarah C. Reese filed for Chapter 11 bankruptcy
(Bankr. E.D. Pa. Case No. 12-19376) on Oct. 2, 2012.
CENTRAL AMERICA BOTTLING: S&P Affirms BB CCR; Outlook Still Stable
------------------------------------------------------------------
S&P Global Ratings said that it affirmed its 'BB' long-term global
scale corporate credit and debt ratings on The Central America
Bottling Corp. (CBC). The outlook on the corporate credit rating
remains stable.
At the same time, S&P assigned its 'BB' issue-level ratings to the
company's proposed 10-year $500 million and 7-10 year $75 million
equivalent in PEN senior unsecured notes.
The rating affirmation reflects S&P's view that, despite higher
debt levels than S&P's previous forecast, CBC's key credit metrics
will continue to be in line with S&P's financial risk profile
assessment. S&P's understanding is that the company will use the
proceeds from the proposed $575 million bond issuances to refinance
its $300 million senior unsecured notes while using the remaining
amount to fund growth opportunities in the region, including
potential acquisitions. However, S&P anticipates CBC will maintain
a debt–to-EBITDA ratio below 3x and EBITDA interest coverage
above 3x. Moreover, CBC could benefit from expanding its
production capacity, mainly in Guatemala and Honduras, to continue
supporting the launch of new products and formats in these
markets.
S&P's business risk profile assessment on CBC incorporates its
leading position in the Central America and the Caribbean
carbonated soft drink market, supported by its renowned product
portfolio and wide distribution network that reaches over 600
points of sale. CBC has strategic alliances with PepsiCo and
AmBev, which provide perpetual exclusive rights to distribute and
sell its products in Central America. Its strategic alliance with
PepsiCo also provides CBC with the right of first refusal to
purchase interest in any PepsiCo-affiliated company or bottler in
the region that is offered for sale. Offsetting factors include
the company's exposure to countries with a high risk operating
environment, foreign currency fluctuations, and increased
competition.
CBC is reformatting its product portfolio and increasing prices in
an effort to offset margin pressures from regulatory tax
impositions in certain markets, as well as the effect of a strong
dollar in its cost structure given that more than 50% of its raw
materials are denominated in this currency. Additionally, the
company holds long-term agreements with suppliers maintaining
certain raw material price stability. In S&P's view, these
measures will allow CBC to maintain its EBITDA margin close to
13.5%, in line with the industry's average.
S&P expects CBC will continue posting key credit metrics in line
with S&P's financial risk profile assessment, even considering
additional debt following the proposed bonds' issuance. Based on
CBC's growth prospects, historical moderate use of debt, and
expected cash balance, S&P believes the company will maintain debt
to EBITDA below 3x and EBITDA interest coverage above 3x. For the
12 months ended Sept. 16, 2016, CBC's debt to EBITDA was 2x and
EBITDA interest coverage was 5.9x, in line with S&P's forecast.
S&P's base-case scenario assumes these factors for 2017 and 2018:
-- Low- to mid-single-digit percent Central America GDP growth
on average for 2017 and 2018, supporting a stable
consumption for soft drink products in the region;
-- Double-digit percent revenue growth for 2017 based on the
company's investment plans, normalizing to low-single-digit
percent revenue growth in 2018;
-- Capital expenditures (capex) and other investments of nearly
$380 million in 2017 and $80 million in 2018. Investments
are mainly related to potential acquisitions, modernization
of its plants, launching of new products and coolers;
-- Issuance of $575 million senior unsecured notes to refinance
its existing $300 million senior unsecured notes due in
2022. Incremental debt is mainly to support growth
opportunities in the region including potential
acquisitions; and
-- Dividend distributions to remain in line with previous
years.
Based on these assumptions S&P arrives at these credit metrics for
2017 and 2018:
-- EBITDA margins of about 13.5%;
-- Debt to EBITDA below 3x;
-- FFO to debt near 30%; and
-- EBITDA interest coverage of about 4.5x.
S&P continues assess CBC's liquidity as adequate because S&P
forecasts that sources of liquidity will exceed uses by at least
1.2x over the next 12 months and that this ratio will remain above
1x even if EBITDA declines by 15%.
Principal liquidity sources:
-- Cash and short-term investments of about $133 million as of
September 2016;
-- Funds from operations (FFO) of about $160 million for the
next 12 months; and
-- Net transaction inflow of $575 million dual-tranche
(including $75 million equivalent in PEN). Note that the
proposed transactions will be conducted under a best-effort
practice and thus, the final amount is subject to change.
Principal liquidity uses:
-- Debt amortizations of about $320 million, which includes
refinancing of its $300 million senior secured notes due in
2022;
-- Working capital outflows of about $25 million for the next
12 months;
-- Investments and capital expenditures in excess of
$300 million for the next 12 months; and
-- Dividend payments of about $40 million for the next 12
months.
The early redemption of its existing notes due in 2022 and most of
the investments, including capex, will be mainly funded with the
proceeds of the proposed bond issuances.
As of Sept. 30, 2016, CBC was in compliance with its incurrence
covenants, which consist of a total leverage ratio below 3x and a
fixed charge coverage ratio of more than 2.5x. If CBC refinances
its notes, the proposed indentures will provide headroom for the
$275 million incremental debt that the company is seeking to obtain
from the proposed transaction, as the new notes consider a total
leverage ratio below 3.75x and a fixed charge coverage ratio of
more than 2x.
The stable outlook reflects S&P's view that CBC will maintain its
debt to EBITDA below 3x and EBITDA interest coverage close to 4.5x
for the next 12 months, despite incremental debt to fund its
investment plan, including potential acquisitions. This, as S&P
expects steady top line growth while EBITDA margins remain close to
13.5%, supported by an effective pricing and commercial strategy.
S&P could lower the ratings if CBC's growth strategy and capex
result in a higher than anticipated use of debt, eroding the
company's credit metrics, leading to debt to EBITDA above 3x and
EBITDA interest coverage below 3x on a consistent basis.
Although unlikely in the next 12 months, S&P could raise the
ratings if CBC achieves stable revenue growth, coupled with
greater-than-expected improvement in its profitability metrics.
Such an improvement could result from higher margins realized from
synergies from its expansion plans, leading to debt to EBITDA
trending below 2x and EBITDA interest coverage above 6x. An
upgrade would also be subject to S&P's assessment of CBC's
performance under a simulated scenario of Guatemala's default.
CENTRAL AMERICAN BOTTLING: Moody's Rates $575MM Unsec. Notes Ba2
----------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to Central American
Bottling Corporation's (CBC) senior unsecured notes for an amount
of $575 million. At the same time, Moody's affirmed CBC's corporate
family and senior unsecured Ba2 ratings. The outlook is stable.
Under the proposed transaction CBC will issue two tranches: a
10-year $500 million tranche and a 7-10 year $75 million equivalent
tranche denominated in Peruvian Soles. Proceeds will be used to
refinance existing debt and for general corporate purposes. The
notes will be irrevocably and unconditionally guaranteed by all
CBC's material operating subsidiaries representing almost 100% of
the company's assets, revenues, and cash flows.
RATINGS RATIONALE
"The Ba2 ratings reflect CBC's adequate credit metrics and
liquidity, its solid market position in its territories of
operation, its ample soft beverage product portfolio, its
geographic diversification, and its relationship with PepsiCo
through a 12% stake and two seats on the board." said Alonso
Sanchez, a Vice President at Moody's. Also incorporated in the
ratings are CBC's relatively small scale as compared with other
industry peers, its presence in some riskier markets, and the
ongoing event risk given the company's strategy to grow through
acquisitions.
CBC has been able to maintain adequate credit metrics despite
economic downturns, adverse weather conditions, strong competition
and acquisitions. The company has reduced leverage (Moody's adj.
debt/EBITDA) to 2.8 times as of September 2016 down from 3.6 times
as of December 2014, when it peaked, through debt reduction and
higher EBITDA. While additional debt from the proposed issuance
will increase leverage slightly over one turn, Moody's estimats
CBC's adj. debt/EBITDA will decline below 3.3 times by year-end
2017 and below 3 times by year-end 2018 as the company pays down
debt and generates higher EBITDA. CBC's adj. EBIT/interest expense
was 3.3 times over the twelve months ended September 2016 (vs. 3.2
times in 2015 and 2.3 times in 2014).
The company holds strong market positions in its carbonated soft
drinks (CSD) category which accounts for around 51% of consolidated
revenues. In this category, CBC has a #1 market share in Guatemala
and Jamaica, which account for 34% and 7%, respectively, of
revenues of the CSD category. The company has a #2 market share in
Ecuador, Honduras, Puerto Rico, Peru, and El Salvador which
represent 50% of total CSD's revenues.
CBC has a longstanding relationship with PepsiCo, Inc (A1 stable)
which dates back to 1942. In 1998 CBC was named Pepsi's "Anchor
Bottler" for Central America and as of today, PepsiCo has a 12%
stake in CBC and two members in its board of directors. "We note
that the "Anchor Bottler" designation expresses PepsiCo's view that
CBC is recognized as an important bottler and will be first in line
for consolidation opportunities in the region, but it does not
imply explicit support from PepsiCo other than shared marketing
expenses as provided in their agreements. Therefore, the ratings
assigned do not consider any uplift due to implicit support from
PepsiCo. However, we view Pepsi's active participation in CBC's
operations as a credit strength in terms of brand, as well as
corporate governance and business practices," Moody's said.
CBC has adequate liquidity. As of September 30, 2016, CBC reported
cash on hand of $133 million that can cover 1.5 times its
short-term debt. The company has over $100 million in committed
credit facilities, which are fully available, and advised lines of
credit of another $130 million that uses to cover seasonal working
capital requirements. In 2017 capital expenditures of $110 million
directed mostly towards Peru will reduce CBC's free cash flow
(defined as cash from operation minus dividends minus capex) to
around $40 million. In 2018-2019, free cash flow will increase
above $100 million as capex declines to around $80 million per year
and dividends remain in the $30 million per year range.
The stable outlook incorporates an expected modest improvement in
profitability, positive free cash flow generation, and a gradual
reduction in leverage over the next couple of years.
An upgrade could be triggered as a result of an increase in the
company's size while maintaining Debt/EBITDA below 2.5 times. In
addition, the company would need to generate higher free cash flow
and/or reduce debt such that Free Cash Flow/Debt is at least 15% on
a sustained basis.
A downgrade could be triggered if credit metrics deteriorate
materially, for example as a result of an acquisition, or due to
negative results in the markets in which CBC operates. EBIT margin
lower than 5%, Debt/EBITDA above 4.5 times or Retained Cash
Flow/Net Debt sustained below 12% could lead to a downgrade.
Headquartered in Guatemala City, Guatemala, Central American
Bottling Corp. is the "Anchor Bottler" of PepsiCo, Inc. for Central
America since 1998. With over 621,000 points of sale, the company
operates in Guatemala, Ecuador, El Salvador, Honduras, Nicaragua,
Puerto Rico, and Jamaica. CBC has a wide product portfolio
including carbonated soft drinks, juices and nectars, isotonic and
energy drinks, water, and tea. In addition, CBC distributes Brahva
and Extra beer brands in Guatemala, El Salvador, Honduras and
Nicaragua through a joint venture with Ambev. CBC is majority owned
and controlled by the Castillo family through an 82.5% stake. The
balance is owned by PepsiCo (12%) and by Grupo Estrada (5.5%). CBC
reported revenues of USD1.6 billion over the twelve months ended
September 2016.
CS MINING: Has Final OK on $2.65-Mil. Tailings DIP Loan, Cash Use
-----------------------------------------------------------------
Judge William T. Thurman of the U.S. Bankruptcy Court for the
District of Utah authorized CS Mining, LLC to enter into additional
$2.65 million postpetition financing with the Tailings DIP Lenders:
Wellington Financing Partners, LLC, St. Cloud Capital Partners II,
L.P. and Oxbow Carbon, LLC.
Judge Thurman further authorized the Debtor to use the funds under
the Tailings DIP Financing and the Cash Collateral pursuant to the
Tailings DIP Financing Documents, and in accordance with the
Tailings Budget, which provides for total operating costs in the
amount of $11,184 for the period from January through July 2017.
Judge Thurman held that all of the Tailings DIP Obligations will
constitute allowed superpriority administrative expense claims
against the Debtor with priority over any and all administrative
expenses of the Debtor (including administrative expenses
constituting Adequate Protection), subject and subordinate only to
the Carve-Out.
All obligations of the Debtor under the Tailings DIP Financing will
be secured by perfected, valid, binding, enforceable,
non-avoidable:
(a) first priority Liens and security interests;
(b) valid, perfected and unavoidable first priority priming
Lien, over, junior Liens and security interests in accordance with
Section 364(c)(3) of the Bankruptcy Code; and
(c) a priming first priority Lien in accordance with Section
364(d) of the Bankruptcy Code on property that is subject to valid,
perfected and unavoidable Prepetition Liens of Waterloo Street
Limited, Western US Mineral Investors LLC, and Sky Mineral
Partners, LLC.
The Carve-Out consists of:
(1) allowed, accrued, but unpaid professional fees and expenses
of the Debtor and the Committee;
(2) allowed, accrued, but unpaid fees and expenses of any
trustee under section 726(b) of the Bankruptcy Code, not to exceed
$25,000 in the aggregate;
(3) allowed, accrued, but unpaid professional fees and expenses
of the Debtor and any Committee after the delivery of a Carve-Out
Notice, not to exceed $100,000 in the aggregate; and
(4) the payment of fees pursuant to 28 U.S.C. Section 1930, plus
any interest pursuant to 31 U.S.C. Section 3717, and amounts
associated with a wind down of the Debtor following the
consummation of the Sale Process, not to exceed $50,000 in the
aggregate.
The Debtor is required to comply with these following milestones:
Initial Expressions of Interest June 2,
2017
Stalking Horse Selection Date June 16
2017
Bid Deadline June 30,
2017
Auction July 10,
2017
Auction Notice Deadline July 12,
2017
Sale and Cure Objection Deadline July 12,
2017
Sale Hearing July 17,
2017
Sale Closing July 31,
2017
A full-text copy of the Final Order, dated Jan. 17, 2017, is
available at
https://is.gd/aT7I2b
About CS Mining, LLC
CS Mining, LLC, is a mining and processing company headquartered in
Milford, Utah.
Purported creditors R.J. Bayer Professional Geologist, LLC;
Minerals Advisory Group, LLC; Rollins Construction & Trucking, LLC;
Rollins Machine, Inc.; and Oxbow Sulphur, Inc., filed an
involuntary petition to put the Company into Chapter 11 bankruptcy
(Bankr. D. Utah Case No. 16-24818) on June 2, 2016. Brahma Group,
Inc. subsequently joined the petition.
On August 4, 2016, the Debtor filed its Notice of Filing Letter to
the Consent and Proposed Form of Order, together with a proposed
form of Order for Relief, which Order was entered by the Court on
the Relief Date. Pursuant to the Order for Relief, CS Mining
continues to operate its business and manage its properties as a
debtor-in-possession pursuant to Chapter 11 of the Bankruptcy
Code.
Judge William T. Thurman presides over the case.
The Petitioners are represented by Martin J. Brill, Esq., at
Levene, Neale, Bender, Yoo & Brill L.L.P and George B. Hofmann,
Esq., at Cohne Kinghorn PC.
CS Mining tapped Snell & Wilmer L.L.P. as local counsel, and Pepper
Hamilton LLP as its legal counsel, nunc pro tunc to June 2, 2016.
FTI Consulting, Inc. as restructuring advisor. Epiq Bankruptcy
Solutions, LLC as claims and noticing agent.
The U.S. Trustee on August 12 appointed an Official Committee of
Unsecured Creditors. The Committee hired Levene, Neale, Bender,
Yoo & Brill L.L.P. as lead counsel and Cohne Kinghorn as local
counsel.
DASEKE INC: S&P Assigns 'B+' CCR & Rates $250MM Loan 'BB-'
----------------------------------------------------------
S&P Global Ratings said that it has assigned its 'B+' corporate
credit rating to Texas-based trucking and logistics company Daseke
Inc. The outlook is stable.
Daseke has proposed raising a $250 million secured senior term loan
and a $100 million delayed draw term loan to refinance its existing
debt and fund the company's acquisition strategy.
At the same time, S&P assigned its 'BB-' issue-level rating and '2'
recovery rating to the company's proposed $250 million secured term
loan and $100 million delayed draw term loan due 2024. The '2'
recovery rating indicates S&P's expectation for substantial
(70%-90%; lower end of the range) recovery in the event of a
payment default.
"Our ratings on Daseke reflect the company's participation in the
highly fragmented, cyclical, and capital-intensive trucking
industry," said S&P Global credit analyst Michael Durand. "Daseke
provides open-deck specialty trucking services in the U.S., Canada,
and Mexico." Over the next couple of years, S&P believes that
Daseke's trucking volumes will increase gradually, supported by
moderate U.S. economic growth. The ratings also reflect S&P's
belief that management's current acquisition strategy will allow
the company to maintain credit measures that are commensurate with
our rating.
The stable outlook on Daseke reflects S&P's belief that the company
will maintain a leverage metric of less than 4x and a funds from
operations (FFO)-to-debt ratio of more than 20%, which is
consistent with S&P's expectations for the rating, as it pursues
accretive acquisitions over the next year.
S&P could lower its rating on Daseke if it were to make large
debt-financed acquisitions beyond S&P's expectations, or if a poor
operating performance caused its FFO-to-debt ratio to approach 12%
for a sustained period.
Although unlikely over the next 12 months, S&P could raise its
rating on Daseke if the company develops a stable track record
running its existing assets while successfully integrating
potential acquisitions and maintaining or improving its operating
performance. Specifically, S&P could raise its ratings on the
company if it operates successfully while maintaining a FFO-to-debt
ratio of more than 25% and a debt-to-EBITDA metric of less than
3.5x on a sustained basis.
DAWSON INTERNATIONAL: Needs Until May 23 to File Chapter 11 Plan
----------------------------------------------------------------
Dawson International Investments (Kinross) Inc. and certain of its
affiliates ask the U.S. Bankruptcy Court for the Southern District
of New York to further extend the exclusive period to file a
chapter 11 plan through and including May 23, 2017, and the
exclusive period to solicit acceptances of a chapter 11 plan
through and including July 24, 2017.
The Debtors relate that they have made progress under chapter 11,
including timely filing their schedules and statements of financial
affairs, setting prompt bar dates and providing notice thereof to
known and potential parties in interest, and investigating issues
regarding the termination of a pension plan and the determination
of potential environmental and tax liabilities. The Debtors are
also working and communicating with state and federal agencies in
regard to pension and environmental claim issues.
The Debtors tell the Court that the requested extension of the
Exclusive Filing Period will allow them to continue to build upon
the progress made in the cases up to this point, in order to
propose an effective plan.
About Dawson International Investments (Kinross) Inc.
Dawson International is in the cashmere business. It comprises two
trading divisions, based in the UK and the USA. The UK division
comprises the Barrie Knitwear business, based in Hawick Scotland.
It manufactures highest quality cashmere garments at its factory in
the Scottish borders and sells to some of the world's most
prestigious couture houses, department stores and private label
retail outlets.
Based in Natick, Massachusetts, Ilion Properties, Inc., Dawson
International Investments (Kinross) Inc., Dawson International
Properties, Inc., DCC USA Inc., and Dawson Luxury Garments LLC
filed separate Chapter 11 bankruptcy petitions (Bankr. S.D.N.Y.
Case Nos. 16-11550 to 16-11554) on May 27, 2016. The Hon. James L.
Garrity Jr. presides over the cases.
Patrick L. Hayden, Esq., and Nathan S. Greenberg, Esq., at
McGuireWoods LLP, serve as counsel to the Debtors.
The Debtors estimated their assets and liabilities at:
Estimated Estimated
Assets Liabilities
----------- -----------
Ilion Properties, Inc. $1MM-$10MM $1MM-$10MM
Dawson International Investments $1MM-$10MM $1MM-$10MM
Dawson International
Properties, Inc. $1MM-$10MM $1MM-$10MM
DCC USA Inc. $1MM-$10MM $1MM-$10MM
The petitions were signed by David G. Cooper, president and sole
director.
DBDFW2 LLC: Hires Turnkey Properties as Manager
-----------------------------------------------
DBDFW2, LLC, seeks authority from the U.S. Bankruptcy Court for the
Northern District of Texas to employ Turnkey Properties, LLC as
manager to the Debtor.
DBDFW2, LLC requires Turnkey Properties to manage the rental of the
Debtor's Single Family Residential real estate located in Dallas.
Turnkey Properties will be paid a total of 10% of rent collections
for its services.
Turnkey Properties will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Dan Blackburn, member of Turnkey Properties, LLC, assured the Court
that the firm is a "disinterested person" as the term is defined in
Section 101(14) of the Bankruptcy Code and does not represent any
interest adverse to the Debtor and its estates.
Turnkey Properties can be reached at:
Dan Blackburn
TURNKEY PROPERTIES, LLC
2408 Victory Park, Suite 1137
Dallas, TX 75219
About DBDFW2 LLC
DBDFW2, LLC sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N. D. Texas Case No. 16-33554) on September 6, 2016,
listing under $1 million in both assets and liabilities.
DERRY COAL: U.S. Trustee Unable to Appoint Committee
----------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Derry Coal Company, LLC, as of
Jan. 19, according to a court docket.
About Derry Coal
C&D Coal Company, LLC, and Derry Coal Company, LLC, both based in
Derry, PA, filed a Chapter 11 petition (Bankr. W.D Pa. Case Nos.
16-24726 and 16-24727) on Dec. 22, 2016. The Hon. Gregory L.
Taddonio presides over the case for Case No. 16-24726; the Hon.
Thomas P. Agresti for 16-24727. Robert O Lampl, Esq., at Robert O.
Lampl, Attorney at Law, to serve as bankruptcy counsel for both
Debtors' cases.
The petitions was signed by Jimmy Edward Cooper, managing member.
C&D Coal Company listed $10 million to $50 million in both assets
and liabilities. Derry Coal listed $1 million to $10 million in
both assets and liabilities.
DIAMOND SHINE: Unsecured Creditors to be Paid 4.3% Over 5 Years
---------------------------------------------------------------
Unsecured creditors of Diamond Shine, Inc., will be paid 4.3% of
their claims under the company's proposed plan to exit Chapter 11
protection.
Under the restructuring plan, creditors holding Class 7 general
unsecured claims will be paid a dividend of $75,000 over five years
without interest.
General unsecured creditors, which assert a total of $1.8 million
in claims, will receive payments starting Jan. 15, 2018.
Under the plan, Diamond Shine will sell two of the three car washes
it operates before confirmation of the plan, and the net proceeds
of sale will be paid to First United Bank & Trust & Trust, a Class
2 secured creditor, which holds a blanket lien on the company's
assets.
Diamond Shine will retain the La Vale car wash and operate it after
confirmation of the plan. The company will pay First United Bank
the value of its collateral in the personal property it owns
estimated to be $100,000 over 20 years with a fixed rate of
interest of 4.25%, according to its disclosure statement filed on
Jan. 12 with the U.S. Bankruptcy Court for the Western District of
Pennsylvania.
A copy of the disclosure statement is available for free at:
https://is.gd/tPdmZt
Diamond Shine is represented by:
Donald R. Calaiaro, Esq.
Calaiaro Valencik
428 Forbes Avenue, Suite 900
Pittsburgh, PA 15219-1621
Tel: (412) 232-0930
About Diamond Shine
Diamond Shine, Inc., which operates three car washes in Maryland,
sought protection under Chapter 11 of the Bankruptcy Code in the
U.S. Bankruptcy Court for the Western District of Pennsylvania
(Johnstown) (Case No. 16-70154) on March 3, 2016.
The petition was signed by Steven E. Leydig, Sr., authorized
representative. The Debtor is represented by Donald R. Calaiaro,
Esq., at Calaiaro Valencik.
The Debtor estimated both assets and liabilities in the range of $1
million to $10 million.
DICKIE POH: Sale of Real and Personal Property Approved
-------------------------------------------------------
Judge Kevin R. Huennekens of the U.S. Bankruptcy Court for the
Eastern District of Virginia authorized Dickie Poh Corp.'s sale of
real property to SSPI Real Estate Holdings, LLC ("SSPIREH"), and
substantially all of its personal property, to SSPI Mid-Atlantic,
LLC ("SSPIMA").
The sale is free and clear of any liens, claims, encumbrances, or
interests.
The consideration that is payable by SSPIREH for the Debtor's real
property under the APA constitutes payment of "value," as the term
is used in the Bankruptcy Code. SSPIREH is a purchaser of the real
property "in good faith" within the meaning of 11 U.S.C. Sec.
363(m).
The consideration that is payable by SSPIMA for the Debtor's
personal property under the APA constitutes payment of "value," as
the term is used in the Bankruptcy Code. SSPIMA is a purchaser of
the real property "in good faith" within the meaning of Sec.
363(m).
The APA and any related agreements may be waives, modified,
amended, or supplemented by agreement of the Debtor, SSPIREH, and
SSPIMA without further action of the Court so long as any such
waiver, modification, amendment, or supplement is not material and
substantially conforms to and effectuates the APA and any related
agreements.
The Order will take effect upon its entry and will not be
automatically stayed under the Bankruptcy Rules 6004(h) or 7062.
Proposed Counsel for the Debtor:
Richard Maxwell, Esq.
Justin E. Simmons, Esq.
WOODS ROGERS PLC
Wells Fargo Tower, Suite 1400
10 South Jefferson Street
P.O. Box 14125
Roanoke, VA 24038-4125
Telephone: (540) 983-7600
Facsimile: (540) 983-7711
E-mail: rmaxwell@woodsrogers.com
jsimmons@woodsrogers.com
DVR LLC: Ch.11 Trustee Taps Scott Land as Real Estate Broker
------------------------------------------------------------
The Chapter 11 trustee for DVR, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Colorado to hire a real estate
broker.
Joli Lofstedt, the court-appointed trustee, proposes to hire Scott
Land Company, LLC to market and sell a property located in Quay and
Harding Counties, New Mexico. The property is a 12,385.5-acre of
dry pasture land owned by the State of New Mexico and leased by
DVR.
Scott Land will get a commission of 6% of the gross sales price,
plus applicable New Mexico gross receipts tax.
Ben Scott, a real estate broker and owner of Scott Land, disclosed
in a court filing that his firm does not represent any interest
adverse to the Debtor's bankruptcy estate.
The firm can be reached through:
Ben G. Scott
Scott Land Company, LLC
1368 U.S. Highway 385 North
Dimmitt, TX 79027
Phone: (800) 933-9698
Phone: (806) 647-4375
Email: Ben.Scott@ScottLandCompany.com
About DVR LLC
DVR, LLC, based in Englewood, Colo., filed a Chapter 11 petition
(Bankr. D. Colo. Case No. 16-17064) on July 18, 2016. The petition
was signed by Edward B. Cordes, authorized representative.
The Hon. Joseph G. Rosania Jr. presides over the case. Matthew T.
Faga, Esq., and James T. Markus, Esq., at Markus Williams Young &
Zimmerman LLC serve as bankruptcy counsel.
In its petition, the Debtor estimated $1 million to $10 million in
both assets and liabilities.
On September 23, 2016, the court approved the appointment of Joli
A. Lofstedt, as Chapter 11 trustee for the Debtor. The trustee
hired Onsager, Guyerson, Fletcher, Johnson as legal counsel, and
Dennis & Company PC as accountant.
ECI HOLDCO: S&P Retains 'B' Rating Following Loan Upsize
--------------------------------------------------------
S&P Global Ratings said that its 'B' issue-level rating and '3'
recovery rating on the first-lien credit facility issued by
Electrical Components International Inc., a subsidiary of
St. Louis-based ECI Holdco Inc., are unchanged following ECI's
announcement that the loan is being upsized by $135 million. The
'3' recovery rating on the facility reflects S&P's expectation for
meaningfu/l (50%-70%; lower half of the range) recovery in a
payment default scenario.
S&P expects that the company will use the proceeds from this
transaction to fund its acquisition of Fargo Assembly Co., a North
American provider of wire harnesses to the motorcycle, agriculture,
construction, and specialty transportation end markets.
RATINGS LIST
ECI Holdco, Inc.
Corporate Credit Rating B/Stable/--
Ratings Unchanged
Electrical Components International Inc.
First-Lien Credit Facility B
Recovery Rating 3L
EDWARD JACOBY: Selling Residential Property in Galva
----------------------------------------------------
Edward M. Jacoby and Billy G. Coffey ask the U.S. Bankruptcy Court
for the Central District of Illinois to authorize the sale of
residential real estate located at 402 Swank Street, Galva,
Illinois.
The Debtors have received an offer to purchase said real estate.
Community State Bank of Galva holds a mortgage on said property.
Community State Bank has indicated a willingness to release its
mortgage in order to facilitate such sale, while retaining its
claim against Debtors for the underlying debt.
Sale of said property would not impair the interests of their
unsecured creditors, and might possibly benefit the unsecured
creditors by relieving the Debtors of expenses connected with the
property. Accordingly, the Debtors ask the Court to approve the
sale of their residential property.
The Chapter 11 case is In re EDWARD M. JACOBY and BILLY G. COFFEY,
JR. (Bankr. C.D. Ill. Case No. 16-81369).
ENERGAS RESOURCES: Acquires Energy and Environmental Services
-------------------------------------------------------------
Energas Resources Inc. acquired Energy and Environmental Services,
Inc., on Oct. 24, 2016, in exchange for 32,000,000 shares of the
Company's common stock.
Following the acquisition of EES, the Company had 47,994,944
outstanding shares of common stock.
On Jan. 12, 2017, the closing price of the Company's common stock
was $1.25 per share.
Following the acquisition of EES, the Company:
* changed its name to Energy and Environmental Services, Inc.;
and
* changed its trading symbol to "EESE".
About Energas Resources
Based in Oklahoma City, Oklahoma, Energas Resources Inc. (OTC BB:
EGSR) -- http://www.energasresources.com/-- is primarily engaged
in the operation, development, production, exploration and
acquisition of petroleum and natural gas properties in the
United States through its wholly-owned subsidiary, A.T. Gas
Gathering Systems Inc. In addition, the company owns and operates
natural gas gathering systems located in Oklahoma, which serve
wells operated by the company for delivery to a mainline
transmission system. The majority of the company's operations are
maintained and occur through A.T. Gas.
Smith, Carney & Co. P.C. has expressed substantial doubt against
Energas Resources Inc.'s ability as a going concern after auditing
the Company's results for the fiscal year ended January 31, 2010.
In its Form 10-K filed with the U.S. Securities and Exchange
Commission, the Company reported a net loss of $1.9 million on
$165,794 of total revenue for the year ended Jan. 21, 2010,
compared with a net loss of $2.4 million on $284,297 total revenue
during the same period a year ago.
ENERGY FUTURE: Cancels Registration of Securities
-------------------------------------------------
Energy Future Holdings Corp. said in a Form 15 filing with the
Securities and Exchange Commission that it will terminate the
registration of these securities:
-- Common Stock, $0.0001 par value
-- 10.875% Senior Notes due 2017
-- 11.250%/12.000% Senior Toggle Notes due 2017
-- 9.75% Senior Secured Notes due 2019
-- 10.000% Senior Secured Notes due 2020
-- 5.55% Series P Notes due 2014, and
-- 6.50% Series Q Notes due 2024
EFH said the approximate number of holders of record as of the
certification date are:
Common Stock, $0.0001 par value -- 61
10.875% Senior Notes due 2017 -- 20
11.250%/12.000% Senior Toggle
Notes due 2017 -- 24
9.75% Senior Secured Notes due 2019 -- 20
10.000% Senior Secured Notes
due 2020 -- 5
5.55% Series P Notes due 2014 -- 34
6.50% Series Q Notes due 2024 -- 37
About Energy Future
Energy Future Holdings Corp., formerly known as TXU Corp., is a
privately held diversified energy holding company with a Portfolio
of competitive and regulated energy businesses in Texas.
Oncor, an 80 percent-owned entity within the EFH group, is the
largest regulated transmission and distribution utility in Texas.
The Company delivers electricity to roughly three million delivery
points in and around Dallas-Fort Worth. EFH Corp. was created in
October 2007 in a $45 billion leverage buyout of Texas power
company TXU in a deal led by private-equity companies Kohlberg
Kravis Roberts & Co. and TPG Inc.
On April 29, 2014, Energy Future Holdings and 70 affiliated
companies sought Chapter 11 bankruptcy protection (Bankr. D. Del.
Lead Case No. 14-10979) after reaching a deal with some key
financial stakeholders to keep its businesses operating while
reducing its roughly $40 billion in debt.
The Debtors' cases have been assigned to Judge Christopher S.
Sontchi (CSS).
As of Dec. 31, 2013, EFH Corp. reported assets of $36.4 billion in
book value and liabilities of $49.7 billion. The Debtors have $42
billion of funded indebtedness.
EFH's legal advisor for the Chapter 11 proceedings is Kirkland &
Ellis LLP, its financial advisor is Evercore Partners and its
restructuring advisor is Alvarez & Marsal. The TCEH first lien
lenders supporting the restructuring agreement are represented by
Paul, Weiss, Rifkind, Wharton & Garrison, LLP as legal advisor,
and Millstein & Co., LLC, as financial advisor.
The EFIH unsecured creditors supporting the restructuring
agreement
are represented by Akin Gump Strauss Hauer & Feld LLP, as legal
advisor, and Centerview Partners, as financial advisor. The EFH
equity holders supporting the restructuring agreement are
represented by Wachtell, Lipton, Rosen & Katz, as legal advisor,
and Blackstone Advisory Partners LP, as financial advisor. Epiq
Systems is the claims agent.
Wilmington Savings Fund Society, FSB, the successor trustee for
The
second-lien noteholders owed about $1.6 billion, is represented by
Ashby & Geddes, P.A.'s William P. Bowden, Esq., and Gregory A.
Taylor, Esq., and Brown Rudnick LLP's Edward S. Weisfelner, Esq.,
Jeffrey L. Jonas, Esq., Andrew P. Strehle, Esq., Jeremy B. Coffey,
Esq., and Howard L. Siegel, Esq. An Official Committee of
Unsecured Creditors has been appointed in the case. The Committee
represents the interests of the unsecured creditors of only Energy
Future Competitive Holdings Company LLC; EFCH's direct subsidiary,
Texas Competitive Electric Holdings Company LLC; and EFH Corporate
Services Company, and of no other debtors. The Committee has
selected Morrison & Foerster LLP and Polsinelli PC for
representation in this high-profile energy restructuring. The
lawyers working on the case are James M. Peck, Esq., Brett H.
Miller, Esq., and Lorenzo Marinuzzi, Esq., at Morrison & Foerster
LLP; and Christopher A. Ward, Esq., Justin K. Edelson, Esq.,
Shanti
M. Katona, Esq., and Edward Fox, Esq., at Polsinelli PC.
* * *
In December 2015, the Bankruptcy Court confirmed the Debtors'
reorganization plan, which contemplated a tax-free spin of the
company's competitive businesses, including Luminant and TXU
Energy, and the $20 billion sale of its holdings in non-debtor
electricity transaction unit Oncor Electric Delivery Co. to a
consortium of investors. But the Plan became null and void after
certain first lien creditors notified the occurrence of a "plan
support termination event."
The Debtors filed a new plan of reorganization on May 1, 2016, as
subsequently amended. The new Chapter 11 plan features
alternative options for dealing with the Company's stake in
electricity transmission unit Oncor.
On Aug. 29, 2016, Judge Sontchi confirmed the Chapter 11 exit plans
of two of Energy Future Holdings Corp.'s subsidiaries, power
generator Luminant and retail electricity provider TXU Energy Inc.
(the "T-Side Debtors"). The Plan became effective on Oct. 3,
2016.
On Sept. 21, 2016, the Debtors filed the E-Side Plan and the
Disclosure Statement for the Fourth Amended Joint Plan of
Reorganization of Energy Future Holdings Corp., et al., Pursuant to
Chapter 11 of the Bankruptcy Code as it Applies to the EFH Debtors
and EFIH Debtors (the "E-Side Debtors").
FAHEY EXTERIORS: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Fahey Exteriors, LLC, as of
Jan. 20, according to a court docket.
Fahey Exteriors, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. S.D.W. Va. Case No. 16-30572) on December 15, 2016,
disclosing under $1 million in both assets and liabilities.
The Debtor is represented by Joe M. Supple, Esq., at Supple Law
Office PLLC. Dunn Cooper Adkins & Reynolds, PLLC serves as its
accountant.
FOGGIA REAL: Cash Collateral Hearing Scheduled for Feb. 9
---------------------------------------------------------
Judge Christopher J. Panos of the U.S. Bankruptcy Court for the
District of Massachusetts scheduled a further hearing on Foggia
Real Estate LLC's use of cash collateral to be held on February 9,
2017 at 10:30 a.m.
The Parties were directed to submit a proposed order in word format
to CJP@MAB.USCOURTS.GOV.
A full-text copy of the Order, dated January 12, 2017, is available
at https://is.gd/PeUPwJ
About Foggia Real Estate LLC
Foggia Real Estate LLC filed for Chapter 11 bankruptcy protection
(Bankr. D. Mass. Case No. 16-41832) on Oct. 27, 2016. The petition
was signed by Joseph L. Cariglia, manager. The Debtor is
represented by James P. Ehrhard, Esq., at Ehrhard & Associates,
P.C. At the time of filing, the Debtor had assets and liabilities
estimated to be between $500,000 to $1 million each.
FOUR SEASONS: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Four Seasons Landscape Management Inc.
P.O. Box 71836
Newnan, GA 30271
Case No.: 17-10114
Chapter 11 Petition Date: January 19, 2017
Court: United States Bankruptcy Court
Northern District of Georgia (Newnan)
Judge: Hon. Homer W. Drake
Debtor's Counsel: Nevin J. Smith, Esq.
SMITH CONERLY LLP
402 Newnan Street
Carrollton, GA 30117
Tel: (770) 834-1160
Fax: (770) 834-1190
E-mail: awilson@smithconerly.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Richard Santiago, CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at http://bankrupt.com/misc/ganb17-10114.pdf
FRAC TECH: Bank Debt Trades at 14% Off
--------------------------------------
Participations in a syndicated loan under Frac Tech Services Ltd is
a borrower traded in the secondary market at 86.11
cents-on-the-dollar during the week ended Friday, January 13, 2017,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents an increase of 4.52 percentage points from the
previous week. Frac Tech pays 475 basis points above LIBOR to
borrow under the $0.55 billion facility. The bank loan matures on
April 3, 2021 and carries Moody's Ca rating and Standard & Poor's
CCC rating. The loan is one of the biggest gainers and losers
among 247 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended January 13.
FUNCTION(X) INC: Appoints Rant Co-Founder Chief Operating Officer
-----------------------------------------------------------------
Function(X) Inc. named Brian Rosin as its chief operating officer
on Jan. 16, 2017.
Mr. Rosin came to the Company as a result of its July 2016
acquisition of Rant, Inc., which he co-founded in 2011. While at
Rant, Mr. Rosin served as chief operating officer, vice president
finance & accounting, and vice president of operations. Prior to
beginning full-time employment at Rant in February 2012, Mr. Rosin
was an Annuity Specialist and LTC Claims Operations Analyst at
Banker's Life and Casualty Company in Chicago, Illinois. Mr. Rosin
earned bachelors' degrees in International Relations and Economics
from Northern Illinois University.
According to the Company, Mr. Rosin has no family relationships
with any director, executive officer or person nominated or chosen
by the Company to become a director or executive officer of the
Company. Mr. Rosin is not a party to any transaction required to
be disclosed pursuant to Item 404(a) of Regulation S-K.
The Company is currently negotiating the terms of an employment
agreement with Mr. Rosin.
About Function(x)Inc.
Based in New York, FunctionX Inc (NASDAQ:FNCX) is a diversified
media and entertainment company. The Company conducts three lines
of businesses, which are digital publishing through Wetpaint.com,
Inc. (Wetpaint) and Rant, Inc. (Rant); fantasy sports gaming
through DraftDay Gaming Group, Inc. (DDGG), and digital content
distribution through Choose Digital, Inc. (Choose Digital). The
Company's segments include Wetpaint, which is a media channel
reporting original news stories and publishing information content
covering television shows, music, celebrities, entertainment news
and fashion; Choose Digital, which is a business-to-business
platform for delivering digital content; DDGG, which is a
business-to-business operator of daily fantasy sports, and Other.
The Company's digital publishing business also includes Rant, which
is a digital publisher that publishes original content in over 13
verticals, such as in sports, entertainment, pets, cars and food.
The Company incurred a net loss of $63.68 million for the year
ended June 30, 2016, compared to a net loss of $78.53 million for
the year ended June 30, 2015. As of Sept. 30, 2016, Function(x)
had $33.07 million in total assets, $27.51 million in total
liabilities and $5.55 million in total stockholders' equity.
BDO USA, LLP, in New York, issued a "going concern" qualification
on the consolidated financial statements for the year ended
June 30, 2016, citing that the Company has suffered recurring
losses from operations and at June 30, 2016, has a deficiency in
working capital that raise substantial doubt about its ability to
continue as a going concern.
FUNCTION(X) INC: Borrows Additional $250,000 from Sillerman
-----------------------------------------------------------
As previously disclosed by Function(x) Inc. in a Form 8-K filed
with the Securities and Exchange Commission on June 12, 2015,
Sillerman Investment Company IV, LLC, an affiliate of Robert F.X.
Sillerman, the Company's executive chairman and chief executive
officer of the Company, agreed to provide a Line of Credit to the
Company.
On Jan. 18, 2017, the Company borrowed an additional $250,000 under
the Line of Credit. The principal amount now outstanding under the
Line of Credit is $3,714,586 and the Company is entitled to draw up
to an additional $1,285,414 under the Line of Credit, as disclosed
in a regulatory filing with the Securities and Exchange
Commission.
About Function(x)Inc.
Based in New York, FunctionX Inc (NASDAQ:FNCX) is a diversified
media and entertainment company. The Company conducts three lines
of businesses, which are digital publishing through Wetpaint.com,
Inc. (Wetpaint) and Rant, Inc. (Rant); fantasy sports gaming
through DraftDay Gaming Group, Inc. (DDGG), and digital content
distribution through Choose Digital, Inc. (Choose Digital). The
Company's segments include Wetpaint, which is a media channel
reporting original news stories and publishing information content
covering television shows, music, celebrities, entertainment news
and fashion; Choose Digital, which is a business-to-business
platform for delivering digital content; DDGG, which is a
business-to-business operator of daily fantasy sports, and Other.
The Company's digital publishing business also includes Rant, which
is a digital publisher that publishes original content in over 13
verticals, such as in sports, entertainment, pets, cars and food.
The Company incurred a net loss of $63.68 million for the year
ended June 30, 2016, compared to a net loss of $78.53 million for
the year ended June 30, 2015. As of Sept. 30, 2016, Function(x)
had $33.07 million in total assets, $27.51 million in total
liabilities and $5.55 million in total stockholders' equity.
BDO USA, LLP, in New York, issued a "going concern" qualification
on the consolidated financial statements for the year ended
June 30, 2016, citing that the Company has suffered recurring
losses from operations and at June 30, 2016, has a deficiency in
working capital that raise substantial doubt about its ability to
continue as a going concern.
FUNCTION(X) INC: In Default Under $4.4 Million Conv. Debentures
---------------------------------------------------------------
As reported on Function(x) Inc.'s Current Report on Form 8-K filed
with the Securities and Exchange Commission on July 13, 2016, on
July 12, 2016, the Company closed a private placement of $4,444,444
principal amount of convertible debentures and common stock
purchase warrants. The Debentures and Warrants were issued
pursuant to a Securities Purchase Agreement, dated July 12, 2016,
by and among the Company and certain accredited investors within
the meaning of the Securities Act of 1933, as amended.
Upon the closing of the Private Placement, the Company received
gross proceeds of $4,000,000 before placement agent fees and other
expenses associated with the transaction. The Company used the net
proceeds from the transaction for general business and working
capital purposes.
The Company is currently in default under the Debentures issued in
the Private Placement for failure to make certain amortization
payments and for failure to maintain the Minimum Cash Reserve.
The Company is currently in negotiations with holders of
approximately 87% of the Debentures in order to permit the Company
to pay the holders the outstanding principal balance in cash and to
pay any accrued interest and other amounts owed in shares of the
Company's common stock.
Pursuant to the terms of the Debentures, the failure to cure the
non-payment of amortization or failure to maintain the Minimum Cash
Reserve within three trading days after the due date constituted an
Event of Default. Following the occurrence of an event of default,
among other things:
(1) at the Purchaser's election, the outstanding principal
amount of the Debentures, plus accrued but unpaid
interest, plus all interest that would have been earned
through the one year anniversary of the original issue
date if such interest has not yet accrued, liquidated
damages and other amounts owed through the date of
acceleration, shall become, immediately due and payable in
either cash or stock pursuant to the terms of the
Debentures; and
(2) the interest rate on the Debentures will increase to the
lesser of 18% or the maximum allowed by law.
In addition to other remedies available to the Purchasers, the
Company's obligation to repay amounts due under the Debentures is
secured by a first priority security interest in and lien on all of
the Company's assets and property, including the Company's
intellectual property, and such remedies can be exercised by the
Purchasers without additional notice to the Company.
One debenture holder, holding approximately 13% of the principal
amount of the Debentures, has sent a notice of acceleration,
stating that the Company owes $696,000, reflecting the principal
amount of the Debenture plus interest through Nov. 1, 2016.
Interest will accrue at 18% until this amount is satisfied.
Under terms of the $3,000,000 Secured Convertible Note issued in
connection with the acquisition of Rant, a default under other
indebtedness owed by the Company constitutes a default under the
Rant Note. As a result of such Event of Default, the holder of the
Rant Note has executed a waiver that provides that, until May 15,
2017, the events of default arising out of the failure to pay the
amounts due under the Debentures as of the date of the waiver and
the failure by the Company to maintain the Minimum Cash Reserve
will not constitute events of default for purposes of the Rant
Note. As a result of the failure to make the January 2017
amortization payment to the Debenture holders, the Rant Note is
also in default, and such default is not covered by the foregoing
waiver.
About Function(x)Inc.
Based in New York, FunctionX Inc (NASDAQ:FNCX) is a diversified
media and entertainment company. The Company conducts three lines
of businesses, which are digital publishing through Wetpaint.com,
Inc. (Wetpaint) and Rant, Inc. (Rant); fantasy sports gaming
through DraftDay Gaming Group, Inc. (DDGG), and digital content
distribution through Choose Digital, Inc. (Choose Digital). The
Company's segments include Wetpaint, which is a media channel
reporting original news stories and publishing information content
covering television shows, music, celebrities, entertainment news
and fashion; Choose Digital, which is a business-to-business
platform for delivering digital content; DDGG, which is a
business-to-business operator of daily fantasy sports, and Other.
The Company's digital publishing business also includes Rant, which
is a digital publisher that publishes original content in over 13
verticals, such as in sports, entertainment, pets, cars and food.
The Company incurred a net loss of $63.68 million for the year
ended June 30, 2016, compared to a net loss of $78.53 million for
the year ended June 30, 2015. As of Sept. 30, 2016, Function(x)
had $33.07 million in total assets, $27.51 million in total
liabilities and $5.55 million in total stockholders' equity.
BDO USA, LLP, in New York, issued a "going concern" qualification
on the consolidated financial statements for the year ended
June 30, 2016, citing that the Company has suffered recurring
losses from operations and at June 30, 2016, has a deficiency in
working capital that raise substantial doubt about its ability to
continue as a going concern.
GEK REALTY: Voluntary Chapter 11 Case Summary
---------------------------------------------
Debtor: GEK Realty And Home Improvement LLC
111-20 200th Street
Saint Albans, NY 11412
Case No.: 17-40228
Chapter 11 Petition Date: January 19, 2017
Court: United States Bankruptcy Court
Eastern District of New York (Brooklyn)
Judge: Hon. Nancy Hershey Lord
Debtor's Counsel: Arlene Gordon-Oliver, Esq.
ARLENE GORDON-OLIVER & ASSOCIATES, PLLC
199 Main Street, Suite 203
White Plains, NY 10601
Tel: 914-682-9750
Fax: 914-683-9754
E-mail: ago@gordonoliverlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Gregory Carmichael, managing member.
The Debtor did not include a list of its largest unsecured
creditors when it filed the petition.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/nyeb17-40228.pdf
GENE CHARLES: Taps Bowles Rice as Lead Counsel
----------------------------------------------
Gene Charles Valentine Trust seeks approval from the U.S.
Bankruptcy Court for the Northern District of West Virginia to
employ Bowles Rice, LLP as lead counsel.
The professionals expected to work and this case and their rates
are:
Julie Chincheck Partner $365
Richard M. Francis Senior Partner $365
Salene Kraemer Special Counsel $275
Daniel Cohn Associate $215
Annette Jones Paralegal $115
Lori Crown Paralegal $110
The professional services that Bowles Rice will render are:
a. To act as lead counsel for the Debtor in the representation
of the Debtor's case;
b. To prepare and file motions which affect the interest of
the Debtor, and the filing of responses to and defense against such
motions, matters, and proceedings as may become necessary from time
to time in the course of the Debtor's Chapter 11 bankruptcy
proceedings;
c. To serve as counsel with regard to various legal issues and
questions which affect the interests of the Debtor;
d. To represent the Debtor as counsel in any such adversary
proceedings and hearings as may become necessary to serve the best
interest of the Debtor; and
e. To performs all other necessary legal services and
providing all other necessary legal advice to the Debtor in
connection with this Chapter 11 case.
Richard M. Francis, Esq. attests that Bowles Rice and its members
are disinterested persons within the meaning of 11 U.S.C. 101(14).
The Firm can be reached through:
Julia A. Chincheck, Esq.
BOWLES RICE, LLP
600 Quarrier Street
Charleston, WV 25301
Phone: 304-347-1713
Email: jchincheck@bowlesrice.com
- and -
Salene R. Kraemer, Esq.
BOWLES RICE, LLP
Southpointe Town Center
1800 Main Street, Suite 200
Canonsburg, PA 15317
Phone: 724-514-8920
Cell: 412-427-7075
Email: skraemer@bowlesrice.com
About Gene Charles Valentine Trust
Gene Charles Valentine formed Gene Charles Valentine Trust as a
California business trust on November 26, 1986. The Debtor sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D.
W.Va. Case No. 16-01196) on November 28, 2016. The petition was
signed by Gene Charles Valentine, trustee. The case is assigned to
Judge Patrick M. Flatley.
At the time of the filing, the Debtor estimated its assets at $50
million to $100 million and debts at $10 million to $50 million.
GREAT BASIN: Note Buyers OK Release of $1.25M Restricted Funds
--------------------------------------------------------------
As previously disclosed on the current report on Form 8-K filed
with the Securities and Exchange Commission on June 29, 2016, on
June 29, 2016, Great Basin Scientific, Inc., entered into a
securities purchase agreement in relation to the issuance and sale
by the Company to certain buyers of $75 million aggregate principal
amount of senior secured convertible notes and related Series H
common stock purchase warrants.
On Jan. 18, 2017, the 2016 Note Buyers voluntarily removed
restrictions on the Company's use of an aggregate of approximately
$1.25 million previously funded to the Company and authorized the
release of those funds from the restricted accounts of the
Company.
On Jan. 18, 2017, the Company and certain 2016 Note Buyers holding
enough of the 2016 Notes and Series H Warrants to constitute the
required holders under Section 9(e) of the 2016 SPA and Section 19
of the 2016 Notes entered into separate agreements. Pursuant to
the terms of the Amendment Agreements, all of the 2016 Notes were
amended to alter the leak-out provisions previously added to the
2016 Notes pursuant to the amendment agreements entered into
between the Company and the 2016 Note Buyers on Jan. 2, 2017, as
reported in the Company's Current Report on Form 8-K filed on Jan.
3, 2017.
Prior to the Amendment Agreements, the 2016 Notes, provided that
during the period commencing on Jan. 3, 2017, and ending with close
of trading on Jan. 31, 2017, exclusive, no holder of 2016 Notes nor
any of its affiliates will sell, directly or indirectly, on any
trading day more than its pro rata percentage of 40% of the trading
volume of the Company's common stock, unless its common stock is
then trading above $2.50 (as adjusted for stock splits, stock
dividends, recapitalizations and similar events).
The Amendment Agreements amend the terms of the 2016 Notes to
extend the Prior Restricted Period to March 1, 2017, and change the
restriction percentage from 40% to the holders pro rata percentage
of 135% of the trading volume of the Company's common stock.
About Great Basin
Great Basin Scientific is a molecular diagnostic testing company
focused on the development and commercialization of its patented,
molecular diagnostic platform designed to test for infectious
disease, especially hospital-acquired infections. The Company
believes that small to medium sized hospital laboratories, those
under 400 beds, are in need of simpler and more affordable
molecular diagnostic testing methods. The Company markets a system
that combines both affordability and ease-of-use, when compared to
other commercially available molecular testing methods, which the
Company believes will accelerate the adoption of molecular testing
in small to medium sized hospitals. The Company's system includes
an analyzer, which it provides for its customers' use without
charge in the United States, and a diagnostic cartridge, which the
Company sells to its customers.
Great Basin reported a net loss of $57.9 million in 2015 following
a net loss of $21.7 million in 2014.
As of Sept. 30, 2016, Great Basin had $83.40 million in total
assets, $144.9 million in total liabilities, and a total
stockholders' deficit of $61.47 million.
Mantyla McReynolds, LLC, in Salt Lake City, Utah, issued a "going
concern" opinion in its report on the consolidated financial
statements for the year ended Dec. 31, 2015, citing that the
Company has incurred substantial losses from operations causing
negative working capital and negative operating cash flows. These
issues raise substantial doubt about its ability to continue as a
going concern.
GROVE PLAZA: Selling Ontario Properties for $8 Million
------------------------------------------------------
Grove Plaza Partners, LLC, asks the U.S. Bankruptcy Court for the
Northern District of California to authorize the sale of real
properties located at 2522 S. Grove Avenue, Ontario, California
("Anchor Tenants"), (APN 1051-321-62), to Atlantic Santa Ana, LLC,
or its related assignee, for $6,700,000; and at 2506–2510 S.
Grove Avenue, Ontario, California ("Shops at Grove II"), (APN
1051-321-63), to Cheng Family Trustor, its related assignee, for
$1,398,000, subject to overbid.
A hearing on the Motion is set for Feb. 17, 2017 at 10:00 a.m.
The Debtor anticipates that in short order, the Court will enter an
order confirming the Combined Plan of Reorganization and Disclosure
Statement, dated Oct. 21, 2016.
The Plan provides Debtor with authority to sell certain real
property free and clear of liens. Such properties are identified
in the Plan as well as the Supplemental Disclosure Regarding
Assessor's Parcel Numbers filed on Dec. 9, 2016 ("Supplemental
Disclosure").
These properties are:
a. Anchor Tenants, APN 1051-321-62, with an approximate value of
$4,970,464.
b. Molina Health, APN 1051-321-52, with an approximate value of
$1,569,620.
c. Shop Space: (i) Shops at Grove I, APNs 1051-321-51 and
1051-321-55, with an approximate value of $2,652,963; (ii) Shops at
Grove II, APN 1051-321-63, with an approximate value of $1,385,157;
and (iii) Shops at Grove III, APN 1051-171-42, with an approximate
value of $2,959,769.
d. Front Pad, APN 1051-171-44, with an approximate value of
$1,962,025.
The property to be sold consists of the Anchor Tenants parcel, and
the Shops at Grove II. The Plan provides that Debtor will sell the
Anchor Tenants parcel for at least $4,970,646, and the proposed
sale is for $6,700,000, subject to higher and better bids. The
Plan also provides that Debtor will sell the Shops at Grove II
parcel for at least $1,385,157, and the proposed sale is for
$1,398,000, subject to higher and better bids. Hence, the Plan
requires the two parcels to be sold for the minimum aggregate
amount of $6,355,804, and Debtor proposes to sell the two parcels
for the aggregate amount of $8,098,000, or $1,742,196 above the
minimum aggregate amount.
By separate motion filed on Dec. 23, 2016, the Debtor seeks
authority to sell the Molina Health parcel and the Shops at Grove I
parcel for the aggregate amount of $4,225,000.
The San Bernardino Tax Collector, Cantor Group II, LLC, Amor
Architectural Corp., JG Construction and Universal Site Services
("Secured Creditors") all assert liens against the Property and
other real property collateral, including postpetition charges and
fees, in the aggregate amount of approximately $14,656,145. The
$2,847,301 of Cantor Group's claim is disputed, leaving undisputed
secured claims of $11,808,845.
When combined with the sales proposed by the Motion, the Debtor has
pending sales totaling $12,323,000. After accounting for certain
discounts the Debtor anticipates receiving total sales proceeds of
$11,423,000 from the combined sales. The Debtor anticipates
additional sales contracts will be executed in the next several
days and will move for approval of those sales at that time.
Atlantic Santa Ana has agreed to purchase the Anchor Tenants
parcels for the gross price of $6,700,000 and the Cheng Family
Trust has agreed to purchase the Shops at Grove II parcel for
$1,398,000. Both sales are subject to higher and better bids.
The material terms of the PSA for the Anchor Tenants parcel are:
a. Atlantic Santa Ana, or its related assignee, will purchase
the Anchor Tenants parcel for the gross price of $6,700,000.
b. The sale will close on Feb. 6, 2017, unless extended pursuant
to the terms of the agreement or order of the Court.
c. The agreement provides for a due diligence period ending on
Feb. 5, 2017. The agreement does not provide for a financing
contingency. The agreement provides a $900,000 credit in escrow to
buyer for improvements related to the Ross lease.
d. Atlantic Santa Ana LLC has deposited $250,000 to escrow. As
of the time of hearing, Atlantic Santa Ana will have deposited an
additional $250,000, for a total of $500,000. Said deposits are
refundable only if: (1) the agreement is terminated prior to
removal of waiver of the contingencies provided in the PSA; or (2)
Atlantic Santa Ana is overbid and is not the successful bidder.
e. Unpaid real property taxes will be pro-rated. Escrow fees
will be split evenly between the buyer and seller. All other
closing costs will be allocated in accordance with the custom and
practice prevailing in Riverside County.
The material terms of the PSA for the Shops at Grove II parcel
are:
a. Cheng Family Trust, or its related assignee, will purchase
the Shops at Grove II parcel for the gross price of $1,398,000.
b. The sale will close on Feb. 26, 2017, unless extended
pursuant to the terms of the agreement or order of the Court.
c. The agreement provides for a due diligence period ending on
Feb. 6, 2017. The agreement does not provide for a financing
contingency.
d. Cheng Family Trust has deposited $50,000 to escrow. Said
deposit is refundable only if: (1) the agreement is terminated
prior to removal of waiver of the contingencies provided in the
PSA; or (2) Cheng Family Trust is overbid and is not the successful
bidder.
e. Unpaid real property taxes will be pro-rated. Escrow fees
will be split evenly between the buyer and seller. All other
closing costs will be allocated in accordance with the custom and
practice prevailing in Riverside County.
A copy of the PSAs attached to the Motion is available for free
at:
http://bankrupt.com/misc/Grove_Plaza_184_Sales.pdf
The Debtor asks approval of the bidding and sale procedures. The
Debtor may ask approval of such procedures in advance by way of
motion.
The material terms of the Bidding Procedures are:
a. The auction will be held on Feb. 17, 2017, at 10:00 am, or at
another time or location if ordered by the Court and announced at
the aforesaid time and place.
b. At the time and place of auction, all bidders will present
the Debtor with evidence of funds or financing acceptable to Debtor
in an amount necessary to meet the initial bid plus the minimum
initial overbid amount ($6,750,000 for the Anchor Tenants parcel
and $1,448,000 for Shops at Grove II).
c. The minimum initial overbid will be $50,000, and the minimum
amount of all subsequent bids shall be $50,000.
d. Secured Creditors will be afforded any rights to credit bid
to which they are otherwise entitled under the Bankruptcy Code and
applicable law.
e. The sale will be free and clear of all liens, claims and
encumbrances of the Secured Creditors.
f. The sale will be on an "as is, where is," and "with all
faults" basis.
g. If Atlantic Santa Ana or Cheng Family Trust, respectively,
are overbid and are not the successful bidder, all deposits by the
unsuccessful bidder will be refunded.
Marcus & Millichap Real Estate Investment Services represents the
Debtor exclusively. Marcus & Millichap earns a commission of 4% of
the gross price of each sale. The
Debtor asks approval of Marcus & Millichap's commission but does
not request authority to pay it, reserving payment in accordance
with the excerpt of the Plan quoted. If the Anchor Tenants and
Shops at Grove II parcels are sold for the gross aggregate price of
$8,098,000, Marcus & Millichap's commission will be $323,920.
The Debtor asks a determination that Atlantic Santa Ana LLC and
Cheng Family Trust are good-faith buyers and are entitled to the
protections of Bankruptcy Code Section 363(m). Prospective bidders
will be requested to provide a declaration in support of a finding
of good faith including those matters set forth at Item 5 of the
Court's Guidelines re Sale Orders, and the successful bidder should
be deemed a good faith purchaser within the meaning of Section
363(m) of the Bankruptcy Code.
The most likely alternative to the proposed sale is for Cantor
Group to foreclose its lien against the Debtor's real properties.
The Debtor expects that this would leave unsecured creditors with
no recovery. The Debtor has determined that the proposed sale is
in the best interests of the estate. Accordingly, the Debtor asks
the Court to approve the proposed sale to the Buyers free and clear
of liens.
The Debtor asks that the stays imposed by Rule 62(a) of the Federal
Rules of Civil Procedure and Rule 6004(h) of the Federal Rules of
Bankruptcy Procedure be waived.
About Grove Plaza Partners
Headquartered in Redwood Shores, Cal., Grove Plaza Partners, LLC,
filed for Chapter 11 bankruptcy protection (Bankr. N.D. Cal. Case
No. 16-30531) on May 13, 2016, estimating assets and
liabilities between $10 million and $50 million. The petition was
signed by George A. Arce, Jr., manager. The case is assigned to
Judge Dennis Montali.
Reno F.R. Fernandez, Esq., and Matthew J. Olson, Esq., at
MacDonald
Fernandez LLP, serve as the Debtor's bankruptcy counsel.
GYMBOREE CORP: Bank Debt Trades at 49% Off
------------------------------------------
Participations in a syndicated loan under Gymboree Corp is a
borrower traded in the secondary market at 50.90
cents-on-the-dollar during the week ended Friday, January 13, 2017,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.60 percentage points from the
previous week. Gymboree Corp pays 350 basis points above LIBOR to
borrow under the $0.82 billion facility. The bank loan matures on
Feb. 23, 2018 and carries Moody's Caa3 rating and Standard & Poor's
CC rating. The loan is one of the biggest gainers and losers among
247 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended January 13.
HARVEST COMMUNITY: FDIC Named as Receiver; FCB Assumes Deposits
---------------------------------------------------------------
Harvest Community Bank, Pennsville, New Jersey, was closed Jan. 13,
2017, by the New Jersey Department of Banking and Insurance, which
appointed the Federal Deposit Insurance Corporation (FDIC) as
receiver. To protect the depositors, the FDIC entered into a
purchase and assumption agreement with First-Citizens Bank & Trust
Company, Raleigh, North Carolina, to assume all of the deposits of
Harvest Community Bank.
According to the FDIC's statement, the four branches of Harvest
Community Bank will reopen as branches of First-Citizens Bank &
Trust Company during their normal business hours. Depositors of
Harvest Community Bank will automatically become depositors of
First-Citizens Bank & Trust Company. Deposits will continue to be
insured by the FDIC, so there is no need for customers to change
their banking relationship in order to retain their deposit
insurance coverage up to applicable limits. Customers of Harvest
Community Bank should continue to use their existing branch until
they receive notice from First-Citizens Bank & Trust Company that
it has completed systems changes to allow other First-Citizens Bank
& Trust Company branches to process their accounts as well.
Depositors of Harvest Community Bank can access their money by
writing checks or using ATM or debit cards. Checks drawn on the
bank will continue to be processed. Loan customers should continue
to make their payments as usual.
As of September 30, 2016, Harvest Community Bank had approximately
$126.4 million in total assets and $123.8 million in total
deposits. In addition to assuming all of the deposits of the failed
bank, First-Citizens Bank & Trust Company agreed to purchase
essentially all of the assets.
HEXION INC: Expects to Record Net Sales of $760 Million in Q4
-------------------------------------------------------------
Hexion Inc. announced preliminary results for the fourth quarter
and fiscal year ended Dec. 31, 2016.
The Company expects to record net sales of approximately $760
million, an operating loss of $(39) million to $(27) million and
Segment EBITDA of $65 million to $71 million in the fourth quarter
of 2016. Hexion recorded net sales of $909 million, operating
income of $44 million and Segment EBITDA of $73 million in the
fourth quarter of 2015. Included within Net Sales and Segment
EBITDA in the fourth quarter of 2015 was $78 million and $8
million, respectively, related to the Company's Performance
Adhesives, Powder Coatings, Additives & Acrylic Monomers business
and interest in HA-International, LLC, a joint venture, both of
which were disposed of in 2016. Segment EBITDA is a non-GAAP
financial measure and is defined and reconciled to operating income
later in this release.
For fiscal year 2016, the Company expects to record net sales of
approximately $3.4 billion, operating income of $241 to $253
million, Segment EBITDA of $429 to $435 million and Adjusted EBITDA
of $431 to $441 million. Included within Net Sales and Segment
EBITDA in 2016 was $185 million and $30 million, respectively,
related to PAC and HAI. Hexion recorded net sales of $4.1 billion,
operating income of $260 million and Segment EBITDA of $466 million
in fiscal year 2015. Included within Net Sales and Segment EBITDA
in 2015 was $369 million and $50 million, respectively, related to
PAC and HAI.
"We are pleased to report solid fundamental business performance in
the fourth quarter of 2016 and a strong year-end liquidity
position," said Craig O. Morrison, chairman, president and CEO. "On
a year-over-year basis, our results reflect gains in our Versatic
Acids and Derivatives and global forest products businesses, which
more than offset continued cyclicality in our oilfield business.
Our oilfield business has continued to recover from trough
conditions witnessed earlier this year and demonstrated solid
sequential volume growth and price stability. Going forward, we
believe we are well positioned for long-term growth driven by
strong secular growth trends in our leading specialty product
portfolio, a recovery of our oilfield and base epoxy businesses to
more normalized market conditions and the strategic capital
investments we have made to grow our revenues and enhance our cost
structure."
At Dec. 31, 2016, Hexion estimates that it had total debt of
approximately $3.5 billion compared to $3.8 billion at Dec. 31,
2015, and that it had approximately $180 million of unrestricted
cash and cash equivalents at year-end 2016. Hexion also estimates
that it had liquidity of approximately $510 million as of Dec. 31,
2016, which is comprised of unrestricted cash and cash equivalents,
borrowings available under the Company's senior secured asset-based
revolving credit facility net of outstanding letters of credit, and
time drafts and availability under credit facilities at certain
international subsidiaries.
Hexion will issue a more detailed press release regarding its
fourth quarter and fiscal year 2016 results, and will file its
Annual Report on Form 10-K for the period ended Dec. 31, 2016, in
March, with an accompanying investor conference call to follow
shortly thereafter.
About Hexion Inc.
Hexion Inc., formerly known as Momentive Specialty Chemicals, Inc.,
headquartered in Columbus, Ohio, is a producer of thermoset resins
(epoxy, formaldehyde and acrylic). The Company is also a supplier
of specialty resins for inks and specialty coatings sold to a
diverse customer base as well as a producer of commodities such as
formaldehyde, bisphenol A, epichlorohydrin, versatic acid and
related derivatives.
Hexion reported a net loss attributable to the Company of $40
million on $4.14 billion of net sales for the year ended Dec. 31,
2015, compared to a net loss attributable to the Company of $223
million on $5.13 billion of net sales for the year ended Dec. 31,
2014. As of Sept. 30, 2016, Hexion had $2.18 billion in total
assets, $4.59 billion in total liabilities and a total deficit of
$2.41 billion.
* * *
The TCR reported on Oct. 3, 2014, that Standard & Poor's Ratings
Services lowered its corporate credit rating on Momentive Specialty
by one notch to 'CCC+' from 'B-'. "The downgrade follows MSC's
significant use of cash in the first half of 2014 and our
expectation that lackluster cash flow from operations and elevated
capital spending will cause free operating cash flow to be
significantly negative in 2014 and 2015," said Standard & Poor's
credit analyst Cynthia Werneth.
As reported by the TCR on Dec. 15, 2014, Moody's Investors Service
lowered the Corporate Family Rating of Momentive to 'Caa1' from
'B3'. "Due to elevated leverage, heavy capital spending on new
capacity in 2014 and 2015, and the lack of meaningful improvement
in financial performance, Moody's have lowered Momentive
Specialty's rating," stated John Rogers, senior vice president at
Moody's.
HEXION INC: S&P Assigns 'CCC+' Rating on $460MM Sr. Sec. Notes
--------------------------------------------------------------
S&P Global Ratings said it assigned its 'CCC+' issue-level rating
and '3' recovery rating to Columbus, Ohio.-based Hexion Inc.'s
proposed $460 million first-priority senior secured notes due in
2022. The '3' recovery rating indicates S&P's expectation for
meaningful recovery in the event of payment default (lower half of
the 50% to 70% range).
The company plans to use proceeds to fund redemption of a portion
of the 1.5-lien 8.875% senior secured notes due in 2018. The
company also publically stated that they expect to issue up to $250
million of new senior secured debt for cash and/or in exchange for
a portion of the senior secured notes that are not purchased or
redeemed with the net proceeds of the new notes offering. S&P will
further review the transactions after they close, including the
proposal to amend and extend the asset-based loan.
The ratings on Hexion, including the 'CCC+' corporate credit
rating, are unchanged. The rating outlook remains negative.
All ratings are based on preliminary terms and conditions.
RATINGS LIST
Hexion Inc.
Corporate credit rating CCC+/Negative/--
New Rating
Hexion Inc.
Hexion 2 U.S. Finance Corp.
Senior Secured
$460 mil first-priority nts due in 2022 CCC+
Recovery Rating 3L
HILL-ROM HOLDINGS: S&P Affirms 'BB+' CCR on Planned Acquisition
---------------------------------------------------------------
S&P Global Ratings said that it affirmed its BB+ corporate credit
rating on Hill-Rom Holdings Inc. following the planned acquisition
of Mortara Instrument. The outlook is stable.
S&P also affirmed its 'BB' issue-level rating to its unsecured
debt, reflecting a recovery rating of '5' and expectation of modest
(10%-30%) recovery in the event of default.
S&P affirmed the ratings because the Mortara acquisition is
consistent with S&P's view that the company will pursue portfolio
diversification and expansion and that debt to EBITDA will remain
3x-4x. The last major acquisition, Welch Allyn Inc., was
successfully integrated and provides a more diverse product
portfolio by adding medical diagnostic equipment to Hill-Rom's
beds, surfaces, and surgical equipment portfolio. The Mortara
acquisition would expand that diagnostic cardiology and patient
monitoring base. While these two latest acquisitions improve the
company's business risk profile, S&P already accounted for
additional diversification and expansion into its current business
risk assessment and feel Hill-Rom would need to demonstrate an
ability to leverage its scale in markets outside of beds before S&P
changes its view of its business risk. From a financial risk
perspective, the Mortara acquisition does not change S&P's view
because it only increases leverage slightly, and S&P expects
Hill-Rom to incrementally improve leverage levels over the next two
years.
Hill-Rom's reliance on beds (where it commands more than 50% of the
market and derives 37% of its revenue) and surfaces operations
subjects the company to variable U.S. hospital capital spending.
However the targeted growth strategies have demonstrated the
company's ability to expand its offering into ancillary markets,
allowing for a broader product portfolio. S&P believes Hill-Rom is
increasing the value provided to hospital customers by
consolidating suppliers. While hospitals are under constant
pressure to contain costs and tighten budgets, Hill-Rom has
expanded upon its core bed business to sell systems in wound care
and prevention and respiratory health.
The acquisition of Welch Allyn increased the company's product
diversity by expanding operations within clinical workflow
technologies. The successful integration helped the company
leverage its marketing presence, enhance distribution capability,
and increase participation in a broader suite of products used in
the hospital setting. That benefitted the overall business by
providing a business line that has higher organic growth prospects
than the rest of the organization. Domestic sales are expected to
contribute low- to mid–single-digit percentage organic growth,
and mergers and acquisitions (M&A), including the Mortara
acquisition, are expected to add further growth. Concurrently, S&P
expects international sales to decline slightly, contributing to
overall growth of 7%-8% in 2017 (incorporating a half year of
Mortara) and in 2018 (including a full year of Mortara). Excluding
acquisitions, organic growth for 2017 is expected to be in line
with the industry. All five of the product categories (advancing
mobility, wound care and prevention, clinical workflow, surgical
safety and efficacy, and respiratory care) have large competitors
such as Stryker, Invacare, and GE Healthcare, which have the
resources to match the clinical expertise and product utility
Hill-Rom provides. But pricing pressures--derived from an increased
focus on hospital asset and resource efficiency, competitive
dynamics, and reimbursement constraints--are offset somewhat by
growth via M&A and cost-cutting measures from Hill-Rom's global
footprint optimization strategy.
Financial risk reflects our expectation that the company will
continue to operate with leverage of 3x-4x for 2017 and beyond.
Acquisitions are expected to remain an integral part of the growth
and diversification strategy. S&P expects the company to use
excess free cash flow for dividends and acquisitions, given no
significant maturities until 2021. With leverage of 4.3x in
fiscal-year 2016, including the slightly leveraging impact of the
Mortara acquisition, S&P expects the company to reduce leverage to
4x by the end of fiscal 2017 and further in the projected periods.
-- Revenue growth between 7% and 8% for 2017, benefiting from
increasing domestic sales and the acquisition of Mortara
Instrument, but offset by international headwinds.
-- EBITDA margin to remain around 19%, stabilized by a greater
scale in operations.
-- Acquisition spending of the $330 million paid for Mortara in
2017 and falling to $125 million in 2018 as the company
continues to look for targets with high growth profiles.
-- Free operating cash flow (FOCF) of $190 million-$225 million
in 2017, bolstered by increasing income from operations and
stable capital expenditures.
With sources expected to exceed uses by more than 1.2x, S&P
believes Hill-Rom has an adequate liquidity profile. The company
is viewed as having well established and solid banking
relationships, satisfactory standing in credit markets, generally
prudent risk management, adequate cushion on its covenants, and the
ability to withstand high-impact, low-probability events, albeit
with limited financing. For the forward-looking periods, S&P
expects:
Principal liquidity sources
-- $350 million in undrawn revolver availability;
-- $232 million in balance sheet cash;
-- Funds from operations (FFO) generation of $342 million; and
-- $3 million of working capital inflows.
Principal liquidity uses
-- Capital expenditures (capex) of $121 million; and
-- Debt amortization of $73 million.
While S&P expects more acquisitions, they are not contracted and,
as such, S&P do not include them in its liquidity analysis. The
Mortara acquisition has not been consummated and is not included.
S&P also believes the company would stop paying its dividend in
stress scenarios and therefore do not include it in the liquidity
analysis.
S&P's stable rating outlook on Hill-Rom reflects S&P's expectation
that the company will reduce leverage to about 4x by the end of
2017 and to 3.8x by the end of 2018 from 4.3x. This view assumes
the company continues to pursue acquisitions that are of smaller
scale than that of Welch-Allyn, and keeps leverage near 4x.
The rating could be lowered if the company's acquisition activity
is more aggressive such that leverage increases above 4x, and S&P
believes the company's acquisition activity will remain aggressive
such that leverage would remain above that threshold. This could
occur if Hill-Rom increases debt by $100 million without
incremental EBITDA and S&P thinks leverage will remain over 4x, and
if free cash flow declines to about $100 million due to
unsuccessful acquisition activity or further pricing pressure that
may hurt margins. Additionally, while unlikely, S&P could lower
the rating if the company fails to integrate recently acquired
firms or has further trouble in its international markets such that
EBITDA margins fall below 15%, increasing leverage above 5x.
Hill-Rom could be upgraded if S&P sees it take market share from
competitors, indicated by sustained growth rates that exceed the
respective markets in which they operate. While the company has
adequate barriers to entry, it often competes on price outside of
its core beds market due to the relative inability to structure
assets such that competitive pricing is avoided. If S&P sees
Hill-Rom keep capex at current levels, increase its overall EBITDA
margin above 20%, and increase its market share, S&P would feel the
company has demonstrated an ability to compete more effectively and
would be considered for an upgrade.
HME HOLDINGS: Seeks April 27 Exclusive Plan Filing Extension
------------------------------------------------------------
HME Holdings, Inc., P.J. Rosaly Enterprises, Inc. dba Islandwide
Express and Islandwide Logistics, Inc., request the U.S. Bankruptcy
Court for the District of Puerto Rico to extend the exclusive
period until April 27, 2017 to submit their Disclosure Statement
and Plan of Reorganization, and to extend the deadline to procure
votes under the plan for a term of 60 days after the order granting
approval of the Disclosure Statement is entered.
The Debtors relate that they have moved forward in its
reorganization process and are currently in compliance with all of
their duties under the Bankruptcy Code and the Guideline of the
U.S. Trustee.
In addition, the Debtors tell the Court that the deadline for all
creditors to file their claims has been set on February 17, 2017
and for governmental entities on March 28, 2017 pursuant to the
notices of deadlines issued by the Court. As such, it is
indispensable for the Debtors to be able to reconcile all claims in
order to propose a complete, viable, and effective plan that
accounts for all claims.
Moreover, the Debtors are still in the process of concluding
negotiations with key creditors that are necessary in order to
propose the plan.
About HME Holdings,
P.J. Rosaly & Islandwide Logistics
HME Holdings, Inc.; P.J. Rosaly Enterprises, Inc. dba Islandwide
Express; and Islandwide Logistics, Inc., filed separate chapter 11
petitions (Bankr. D.P.R. Case Nos. 16-07686, 16-07690 and 16-07693)
on Sept. 28, 2016. The petitions were signed by Ivan Marin,
president and authorized representative for each Debtor. The cases
are jointly administered.
The Debtors are represented by Carmen D. Conde Torres, Esq. and
Luisa S. Valle Castro, Esq., at C. Conde & Associates.
Together, the three entities form the Islandwide Group. HME
provides management services for its two related parties:
Islandwide Logistics, Inc. and P.J. Rosaly Enterprises, Inc. It
runs the human resources, business development, information and
technology, finance and accounting departments for both P.J. Rosay
Enterprises and Islandwide Logistics.
PJ Rosaly specializes in providing next day, same day delivery
services to its clients, as well as temperature controlled
deliveries. It is also engaged by the main banks in the island and
provide internal messenger and clearing house services to these
institutions.
Islandwide Logistics operates more than 300,000 square feet of
warehouse space dedicated to providing its clients with inventory
management that includes full inventory systems integration,
electronic order processing, RF capability and retail time
sensitive delivery service. Logistics' distribution center is
designed to ensure the uninterrupted flow of the supply-chain RF
Capable Warehouses.
HME estimated assets at $100,000 to $500,000 and liabilities at $1
million to $10 million at the time of the filing. PJ Rosaly
estimated assets and liabilities at $1 million to $10 million.
Islandwide Logistics estimated assets and liabilities at $1 million
to $10 million at the time of the filing.
No official committee of unsecured creditors has been appointed in
the cases.
HOMER CITY: Can Use BNY Mellon Cash Collateral on Interim Basis
---------------------------------------------------------------
Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District
of Delaware authorized Homer City Generation, L.P., to use cash
collateral on an interim basis.
The Debtor is authorized to use cash collateral pursuant to a
13-week Budget which projects operating disbursements in the
aggregate sum of $130,008, for the period from Jan. 14, 2017
through April 15, 2017.
Prior to the Petition Date, the Debtor entered into that certain
indenture, by and among the Debtor and Bank of New York Mellon, as
trustee and collateral agent. The indenture was executed in
accordance with the Plan of Reorganization of Homer City Funding
LLC, which was confirmed by the Court in: In re: Homer City Funding
LLC, Case No. 12-13024.
To secure the prepetition indebtedness under the indenture, the
Debtor entered into various collateral documents, and pursuant to
which, the Debtor granted security interests in and continuing
lines on, certain assets of the Debtor to and.or for the benefit of
the BNY Mellon and the Senior Noteholders. As of the Petition
Date, the Debtor was indebted and liable to BNY Mellon and/or the
Senior Noteholders in the aggregate principal amount of
approximately $606,912,778, plus accrued and unpaid interest.
BNY Mellon and/or the Senior Noteholders are granted a valid,
enforceable, non-avoidable perfected security interests in and
liens on all property of the Debtor's estate, whether currently
owned or after acquired or existing, whether real or personal,
tangible or intangible, including, among others, all cash,
accounts, inventory, intellectual property, accounts receivable,
insurance proceeds, machinery and equipment leases.
BNY Mellon and/or the Senior Noteholders will also be entitled, as
part of their allowed claims, to the accrual of interest at the
default interest rate under the Indenture after the Petition Date
calculated in accordance with the terms of the Indenture and to the
extent permitted under Section 506(b) of the Bankruptcy Code.
In addition, BNY Mellon and/or the Senior Noteholders were allowed
superpriority administrative expense claims, which claims will have
priority in payment over any and all administrative expenses,
subject and subordinate only to the Carve-Out.
The Carve-Out consists of:
(a) any fees payable to the Clerk of the Court and to the
Office of the U.S. Trustee;
(b) allowed, accrued and unpaid fees and out-of-pocket
expenses of each professional retained by Order of the Court;
(c) up to $350,000 of allowed and unpaid fees and expenses of
all professionals retained by the Debtor and approved by the Court
incurred after the occurrence of a Carve-Out Event; and
(d) any and all reasonable fees and expenses incurred by a
Trustee under Section 726(b) of the Bankruptcy Code not to exceed
$25,000.
Judge Walrath directed the Debtor to provide a 13-week cash
forecast beginning on the following Monday, with supporting detail
and documentation in form and detail, which will become the Budget
for such period.
The final hearing on the Debtor's continued use of cash collateral
will be held on
Feb. 3, 2017 at 10:30 a.m.
A full-text copy of the Order, dated Jan. 12, 2017, is available at
https://is.gd/btjeyO
About Homer City
Homer City Generation, L.P., is the owner of a coal-fired,
independent power production plant located in Homer City,
Pennsylvania, about 45 miles east of Pittsburgh.
Non-debtor EFS Homer City, LLC owns 95.04% of the partnership
interests of Homer City. Metropolitan Life Insurance Company,
which is also not a Debtor in these cases, owns 4.96% of the
partnership interests of Homer City.
Homer City filed a voluntary case under Chapter 11 of the
Bankruptcy Code (Bankr. D. Del. Case No. 17-10086) on Jan. 11,
2017. The case has been assigned to Judge Mary F. Walrath. At the
time of filing, the Debtor estimated assets at $1 billion to $10
billion and liabilities at $500 million to $1 billion.
The Debtor is represented by Joseph Charles Barsalona II, Esq.,
Mark D. Collins, Esq., Andrew Dean, Esq. and Russell C.
Silberglied, Esq. at Richards; PJT Partners serves as its financial
advisor and Zolfo Cooper as its restructuring advisor. Epiq
Bankruptcy Solutions, LLC serves as the Debtor's claims and
administrative advisor.
O'Melveny and Myers LLP and Young Conaway Stargatt & Taylor, LLP
are serving as legal advisors to the ad hoc group of noteholders
and Houlihan Lokey is serving as the financial advisor to the ad
hoc group of noteholders.
III EXPLORATION: Sale of North Dakota Assets for $7.5M Approved
---------------------------------------------------------------
Judge R. Kimball Mosier of the U.S. Bankruptcy Court for the
District of Utah authorize III Exploration II, LP's sale of
substantially all of its North Dakota assets to Pivotal Williston
Basin II, LP or its designee, for $7,250,000, subject to
adjustments.
A hearing on the Sale and Assumption Motion was conducted on Jan.
17, 2017, at 11:00 a.m.
The sale is free and clear of Interests of any kind whatsoever,
with all such Interests to attach to the net proceeds of the sale
in the order of their priority.
The Debtor is authorized to distribute to the First Lien Lenders
proceeds of the sale at closing.
Upon the closing of the sale, the Debtor is authorized and directed
to assume and assign all of the Assigned Contracts to the Buyer
and, for purposes of assumption and assignment of the Assigned
Contracts to the Buyer, the Cure Amount of all Assigned Contracts
is deemed to be zero and the closing will be deemed to (i) effect a
cure of all defaults existing thereunder as of the closing, (ii)
compensate for any actual pecuniary loss to such non-debtor party
resulting from such default, and (iii) together with the assumption
of the Assigned Contracts by the Buyer constitute adequate
assurance of future performance thereof.
If Pivotal fails to consummate the approved sale because of a
breach or failure to perform on the part of Pivotal, then the
Back-Up Bidder will be deemed to be the Buyer for all purposes
under the Order, and the Debtor is authorized, but not required,
without further notice or a hearing, to consummate the sale with
the Back-Up Bidder. In that event, and unless otherwise specified
herein, all references to the Buyer or Pivotal and the Purchase
Agreement will be deemed to apply to the Back-Up Bidder. In the
event of breach or failure to perform occurs on the part of the
Debtor, the
Debtor will immediately return Pivotal's Good Faith Deposit within
5 calendar days.
Notwithstanding Bankruptcy Rules 6004(h) and 6006(d), and to any
extent necessary under Bankruptcy Rule 9014 and Rule 54(b) of the
Federal Rules of Civil Procedure, as made applicable by Bankruptcy
Rule 7054, the Court expressly finds that there is no just reason
for delay in the implementation of the Order, waives any stay under
Rules 6004(h) and/or 6006(d), and expressly directs entry of
judgment as set forth.
About III Exploration II LP
III Exploration II LP and its general partner, Petroglyph Energy,
Inc., are headquartered in Boise, Idaho. III Exploration II is
engaged in the exploration and production of oil and natural gas
deposits, primarily in the Uinta Basin in Utah. III Exploration
also has an interest in approximately 42,100 undeveloped acres in
the Raton Basin located in Colorado, and participates in joint
ventures with respect to properties in the Williston Basin in North
Dakota.
III Exploration filed a chapter 11 petition (Bankr. D. Utah Case
No. 16-26471) on July 26, 2016. The petition was signed by Paul
R.
Powell, president. The Debtor estimated assets at $50 million to
$100 million and debt at $100 million to $500 million.
The case is assigned to Judge R. Kimball Mosier.
The Debtor tapped George Hofmann, Esq., Steven C. Strong, Esq.,
and
Adam H. Reiser, Esq., at Cohne Kinghorn, P.C., to serve as its
general counsel; and A. John Davis, Esq., at Holland & Hart LLP to
serve as special counsel. Tudor Pickering Holt & Co. has been
tapped as investment banker. Donlin Recano & Company Inc. acts as
claims and noticing agent.
IMMUCOR INC: Bank Debt Trades at 3% Off
---------------------------------------
Participations in a syndicated loan under Immucor Inc is a borrower
traded in the secondary market at 96.55 cents-on-the-dollar during
the week ended Friday, January 13, 2017, according to data compiled
by LSTA/Thomson Reuters MTM Pricing. This represents an increase
of 0.17 percentage points from the previous week. Immucor Inc pays
375 basis points above LIBOR to borrow under the $0.665 billion
facility. The bank loan matures on Aug. 19, 2018 and carries
Moody's B2 rating and Standard & Poor's B- rating. The loan is one
of the biggest gainers and losers among 247 widely quoted
syndicated loans with five or more bids in secondary trading for
the week ended January 13.
IMPLANT SCIENCES: DMRJ, Montsant Dismiss Equity Panel's Claims
--------------------------------------------------------------
DMRJ Group and Montsant Partners on Wednesday filed a 100-page
challenge to the request of the Official Committee of Equity
Security Holders of Implant Sciences Corporation for standing to
commence and prosecute claims on behalf of the Debtors' estates
against DMRI Group and Montsant Partners.
The Equity Committee, according to the pre-bankruptcy lenders,
"attempts to weave a salacious tale of a rapacious lender that took
advantage of an otherwise profitable company, forced that company
to remain in an abusive relationship so that the lender could trade
on inside information and reap excessive profits, and caused the
termination of the CEO when he dared challenge the lender's
actions."
DMRJ and Montsant state that the Equity Committee's "tale bears the
distinct perspective of the fired former CEO, who is portrayed as
its fallen hero. As extra background color, the Equity Committee
cites the recent federal indictment of certain former executives
associated with the lender and related SEC and civil litigation,
even though these charges, while certainly serious, are entirely
unrelated to the DMRJ Parties and Debtors."
DMRJ and Montsant tell the Delaware bankruptcy court that the
Committee has not and cannot meet its burden of establishing a
basis for granting it standing to substantially delay and even
threaten what will otherwise be a 100% recovery to more senior
stakeholders. When the Equity Committee's proposed complaint is
stripped of its innuendo and slanted allegations it can be seen for
what it really is -- a tale, full of sound and fury, but ultimately
signifying nothing. The Court should not permit the Equity
Committee to engage in a protracted frolic and detour litigating
baseless claims against the DMRJ Parties in New York Supreme
Court.
DMRJ and Montsant state that for the past eight years, they have
supported Debtors all the way from the beginning stages of the
development, testing and deployment of their technology and
products, to qualification for and a contract with the TSA, through
and including an all asset sale to L3. The asset sale will ensure
the future expansion of the Debtors' business and what should be a
100% payout to all creditors and even a return to equity.
During the time period of the relationship with the DMRJ Parties,
the Debtors' stock was delisted and their operating costs far
exceeded any revenue generated from sales. Despite defaults under
the parties' loan agreements, DMRJ refrained from accelerating the
Debtors' obligation to pay all principal and interest due and
foreclosing on all the Debtors' assets, which would have eliminated
any value for unsecured creditors, much less equity. Put simply,
Debtors could not have stayed in business or reached the point they
are today without the support of DMRJ and Montsant.
DMRJ and Montsant are represented by:
Alan M. Root, Esq.
ARCHER & GREINER, P.C.
300 Delaware Avenue, Suite 1100
Wilmington, DE 19801
Telephone: 302-777-4350
E-mail: aroot@archerlaw.com
- and -
Barbra Parlin, Esq.
Holland & Knight LLP
31 West 52nd Street
New York, NY 10019
Phone: 212.513.3210
Facsimile: 212.385.9010
E-mail: barbra.parlin@hklaw.com
About IMX Acquisition
IMX Acquisition Corp., also known as Ion Metrics Inc., and its
affiliates, comprise a leading designer and manufacturer of
systems
and sensors that detect trace amounts of explosives and drugs.
Their products, which include handheld and desktop detection
devices, are used in a variety of security, safety, and defense
industries, including aviation, transportation, and customs and
border protection. The Debtors have sold more than 5,000 of their
detection products to customers such as the United States
Transportation Security Administration, the Canadian Air
Transportation Security Authority, and major airports in the
European Union.
IMX Acquisition Corp. sought Chapter 11 protection (Bankr. D. Del.
Case No. 16-12238) on Oct. 10, 2016. Its affiliates, Implant
Sciences, C Acquisition Corp. and Accurel Systems International
Corp. also sought Chapter 11 protection. The cases are assigned
to
Judge Brendan Linehan Shannon.
IMX estimated assets and liabilities in the range of $100 million
to $500 million. The Debtors tapped Paul V. Shalhoub, Esq. and
Debra C. McElligott, Esq. and Jennifer J. Hardy, Esq. at Willkie
Farr & Gallagher, LLP as counsel.
The petitions were signed by William J. McGann, president.
Andrew Vara, acting U.S. trustee for Region 3, on Oct. 24, 2016,
appointed Harold Coe and four others to serve on the official
committee of equity security holders. Co-counsel to the Official
Committee of Equity Security Holders are William R. Baldiga, Esq.,
and Gerard T. Cicero, Esq., at Brown Rudnick LLP, in New York, and
Sunni P. Beville, Esq., at Brown Rudnick LLP, in Boston,
Massachusetts; and Mark Minuti, Esq., at Saul Ewing LLP, in
Wilmington, Delaware. The Equity Committee tapped FTI Consulting,
Inc. as financial advisor.
Tannor Partners Credit Fund, LP., the New DIP Lender, is
represented in the case by Andrew M. Felner, Esq., at Sheppard,
Mullin, Richter & Hampton, LP.
* * *
The Debtors on Oct. 10, 2016 entered into an asset purchase
agreement to sell the explosives trace detection (ETD) assets to
L-3 Communications for $117.5 million in cash, plus the assumption
of specified liabilities. The Bankruptcy Court approved the sale
on December 16, 2016, and the parties closed the deal on Jan. 5,
2017. Following completion of the sale, Implant Sciences changed
its name to Secure Point Technologies, Inc. Debtor IMX Acquisition
Corp. changed its name to FIAC Corp.
IMPLANT SCIENCES: Had Talks with Equity Panel on Standing Motion
----------------------------------------------------------------
The Official Committee of Equity Security Holders of Implant
Sciences Corporation informed the Delaware bankruptcy court that it
has had "constructive" discussions with the Debtors regarding its
request for standing to commence and prosecute claims on behalf of
the Debtors' estates against DMRI Group, LLC; and Montsant Partners
LLC. To satisfy the Debtors' informal concerns as to the Standing
Motion, the Committee submitted a revised form of proposed Order
allowing the Standing Motion.
The revised Proposed Order provides that any and all additional
causes of action that may be added to the committee's Draft
Complaint, including any additional counts that may be permitted
under the applicable rules of the court of competent jurisdiction
in which the Draft Complaint may be filed; provided, however, that
the only additional counts and causes of action hereby authorized
to be added to the Draft Complaint by this Order are limited to
those against any of DMRJ, Montsant, and each of their respective
former, current or future officers, employees, directors, agents,
representatives, owners, members, partners, financial advisors,
legal advisors, shareholders, managers, consultants, accountants,
attorneys, affiliates, and predecessors in interest.
The Proposed Order also states that the Challenge Period Deadline
is suspended as it applies to the DMRJ and Montsant Parties until
such time as the Court enters an order finding that DMRJ, Montsant
and Platinum Partners have satisfied all of their respective
obligations arising under the Stipulated 2004 Order; and that the
Debtors' rights to object to any and all fees and expenses arising
from or related to the investigation, commencement and prosecution
of the causes of action asserted in the Draft Complaint on any and
all bases is reserved.
According to a redacted version of the Standing Motion filed in
December, the Equity Committee contends that from the outset of its
dealings with the Debtors, DMRJ exploited its relationship as
secured lenders to the Debtors to amass an unconscionable profit
through the use of threats, manipulation and coercion to permit
DMRJ to reap the benefits of, among other things, insider trading
and a usurious interest rate -- all the while tortiously
interfering with the Debtors' ability to obtain more favorable
financing. Through its coercion and manipulation, DMRJ has, among
other things, amassed over [______] in illegal proceeds in addition
to the millions of dollars in illegal interest it has received, all
to the detriment of the Debtors' estates.
The Committee also alleges that the Platinum Partners personnel
recently indicted on charges for participating in a fraudulent
scheme of over $1 billion with other financial counter-parties are
the same DMRJ personnel that managed the lending relationship with
the Company and the trades of Implant Sciences' stock. In fact,
the Committee was scheduled to depose Joseph SanFilippo on Dec. 21,
2016; but two days earlier he became unavailable because he was
arrested and indicted. Given the DMRJ Executives alleged
involvement in a criminal scheme described in the indictment to
defraud investors in order to maximize Platinum Partners' own
profits, it, unfortunately, comes as no surprise that DMRJ also
here engaged in similarly egregious and wrongful conduct at the
expense of the Debtors and their investors.
According to the Committee, its Standing Motion and the Draft
Complaint do not identify Platinum Partners or the DMRJ Executives
as named defendants. As a result of DMRJ's failure to comply with
the Stipulated 2004 Order, the Committee has not received a
substantial portion of the discovery that this court has ordered
Platinum Partners and DMRJ to produce -- including, significantly,
copies of internal emails by and among the DMRJ Executives and
other personnel at DMRJ and/or Platinum Partners. Without the
discovery, the Committee has not yet been able to ascertain the
nature of claims that may exist against Platinum Partners, all or
certain of the DMRJ Executives and perhaps others at DMRJ and/or
Platinum Partners.
Pursuant to the Second Interim DIP Order, the Committee had until
December 23, 2016 to: (i) investigate the prepetition conduct of
the prepetition lenders, including DMRJ Group and Montsant, and
their representatives; (ii) request standing before the Court to
bring any causes of action; and (iii) thereafter file the related
complaints as a representative of the estate. On November 30,
2016, the Court entered its Final Order wherein the Challenge
Period Deadline was extended up to and including January 23, 2017,
without prejudice to the Committee to seek further extension if
necessary.
A redacted copy of the Standing Motion is available at:
http://bankrupt.com/misc/deb16-12238-0367.pdf
About IMX Acquisition
IMX Acquisition Corp., also known as Ion Metrics Inc., and its
affiliates, comprise a leading designer and manufacturer of
systems
and sensors that detect trace amounts of explosives and drugs.
Their products, which include handheld and desktop detection
devices, are used in a variety of security, safety, and defense
industries, including aviation, transportation, and customs and
border protection. The Debtors have sold more than 5,000 of their
detection products to customers such as the United States
Transportation Security Administration, the Canadian Air
Transportation Security Authority, and major airports in the
European Union.
IMX Acquisition Corp. sought Chapter 11 protection (Bankr. D. Del.
Case No. 16-12238) on Oct. 10, 2016. Its affiliates, Implant
Sciences, C Acquisition Corp. and Accurel Systems International
Corp. also sought Chapter 11 protection. The cases are assigned
to
Judge Brendan Linehan Shannon.
IMX estimated assets and liabilities in the range of $100 million
to $500 million. The Debtors tapped Paul V. Shalhoub, Esq. and
Debra C. McElligott, Esq. and Jennifer J. Hardy, Esq. at Willkie
Farr & Gallagher, LLP as counsel.
The petitions were signed by William J. McGann, president.
Andrew Vara, acting U.S. trustee for Region 3, on Oct. 24, 2016,
appointed Harold Coe and four others to serve on the official
committee of equity security holders. Co-counsel to the Official
Committee of Equity Security Holders are William R. Baldiga, Esq.,
and Gerard T. Cicero, Esq., at Brown Rudnick LLP, in New York, and
Sunni P. Beville, Esq., at Brown Rudnick LLP, in Boston,
Massachusetts; and Mark Minuti, Esq., at Saul Ewing LLP, in
Wilmington, Delaware. The Equity Committee tapped FTI Consulting,
Inc. as financial advisor.
Tannor Partners Credit Fund, LP., the New DIP Lender, is
represented in the case by Andrew M. Felner, Esq., at Sheppard,
Mullin, Richter & Hampton, LP.
* * *
The Debtors on October 10, 2016 entered into an asset purchase
agreement to sell the explosives trace detection (ETD) assets to
L-3 Communications for $117.5 million in cash, plus the assumption
of specified liabilities. The Bankruptcy Court approved the sale
on December 16, 2016, and the parties closed the deal on January 5,
2017. Following completion of the sale, Implant Sciences changed
its name to Secure Point Technologies, Inc. Debtor IMX Acquisition
Corp. changed its name to FIAC Corp.
IMPLANT SCIENCES: Hires Roberts as Chief Financial Officer
----------------------------------------------------------
Implant Sciences Corporation, now known as Secure Point
Technologies, Inc., following the bankruptcy sale of its business,
disclosed in a regulatory filing with the Securities and Exchange
Commission that effective Jan. 6, 2017, the Company entered into a
service agreement with Christopher Roberts, pursuant to which Mr.
Roberts agreed to assist in the preparation of the Company's
financial statements and provide related services.
In connection therewith, on January 6, the board of directors of
the Company appointed Mr. Roberts as the chief financial officer of
the Company.
The Agreement may be terminated by either party upon 14 days' prior
written notice. Pursuant to the Agreement, Mr. Roberts shall be an
independent contractor of the Company and shall be paid on an
hourly basis.
A copy of the Agreement is available at https://is.gd/hKeet0
Mr. Roberts has a law degree from the University of Virginia Law
School and a B.S, in Electrical Engineering and an M.B.A., both
from the Massachusetts Institute of Technology. The M.B.A. was
concentrated in Finance and Management of Technology. He started
his career working for Raytheon Co. (a Fortune 500 company).
Thereafter, he practiced law at two large NYC law firms. Since
leaving the private practice of law in 1983, Mr. Roberts has had
several positions in finance (including as a CFO, controller and
director of finance and administration) and as General Counsel.
From 2010-2011, he was the CFO of Integral Systems, Inc., a public
company traded on NASDAQ under the symbol "ISYS." From 2012 to
November 2016, he worked first as the CFO, and later as the
President of Systems Made Simple, Inc., a wholly owned subsidiary
of Leidos.
As reported by the Troubled Company Reporter, the Debtors on Oct.
10, 2016 entered into an asset purchase agreement to sell the
explosives trace detection (ETD) assets to L-3 Communications for
$117.5 million in cash, plus the assumption of specified
liabilities. The Bankruptcy Court approved the sale on Dec. 16,
2016, and the parties closed the deal on Jan. 5, 2017. Following
completion of the sale, Implant Sciences changed its name to Secure
Point Technologies, Inc. and will trade under a new ticker symbol
on the OTC. The Company is in the process of submitting paperwork
to the OTC Markets whereupon it will be assigned a new ticker
symbol.
Debtor IMX Acquisition Corp. changed its name to FIAC Corp.
In connection with the closing of the sale transaction, on Jan. 6,
2017, each of Dr. William J. McGann, Darryl Jones, Roger Deschenes,
Todd Silvestri and Brenda L. Baron resigned from their positions as
executive officers and employees of the Company and any of its
subsidiaries, as applicable, and Dr. William J. McGann resigned
from his position as a member of the board of directors of each
Seller.
About IMX Acquisition
IMX Acquisition Corp., also known as Ion Metrics Inc., and its
affiliates, comprise a leading designer and manufacturer of
systems
and sensors that detect trace amounts of explosives and drugs.
Their products, which include handheld and desktop detection
devices, are used in a variety of security, safety, and defense
industries, including aviation, transportation, and customs and
border protection. The Debtors have sold more than 5,000 of their
detection products to customers such as the United States
Transportation Security Administration, the Canadian Air
Transportation Security Authority, and major airports in the
European Union.
IMX Acquisition Corp. sought Chapter 11 protection (Bankr. D. Del.
Case No. 16-12238) on Oct. 10, 2016. Its affiliates, Implant
Sciences, C Acquisition Corp. and Accurel Systems International
Corp. also sought Chapter 11 protection. The cases are assigned
to
Judge Brendan Linehan Shannon.
IMX estimated assets and liabilities in the range of $100 million
to $500 million. The Debtors tapped Paul V. Shalhoub, Esq. and
Debra C. McElligott, Esq. and Jennifer J. Hardy, Esq. at Willkie
Farr & Gallagher, LLP as counsel.
The petitions were signed by William J. McGann, president.
Andrew Vara, acting U.S. trustee for Region 3, on Oct. 24, 2016,
appointed Harold Coe and four others to serve on the official
committee of equity security holders. Co-counsel to the Official
Committee of Equity Security Holders are William R. Baldiga, Esq.,
and Gerard T. Cicero, Esq., at Brown Rudnick LLP, in New York, and
Sunni P. Beville, Esq., at Brown Rudnick LLP, in Boston,
Massachusetts; and Mark Minuti, Esq., at Saul Ewing LLP, in
Wilmington, Delaware. The Equity Committee tapped FTI Consulting,
Inc. as financial advisor.
Tannor Partners Credit Fund, LP., the New DIP Lender, is
represented in the case by Andrew M. Felner, Esq., at Sheppard,
Mullin, Richter & Hampton, LP.
INDUSTRIAL RIDE: Seeks Authorization to Use Cash Collateral
-----------------------------------------------------------
Industrial Ride Shop, LLC seeks interim authorization from the U.S.
Bankruptcy Court for the District of Arizona to use cash collateral
to pay necessary and essential post-petition operating expenses,
pending final hearing.
The Debtor's consolidated 14 week budget, for the period December
17, 2016 through March 25, 2017 provides total operational cash
expenses of $916,319 and total Chapter 11 Professional fees and
costs of $56,000. As set forth on the Budget, the Debtors' urgent
cash needs during the interim period, from January 15 through
January 28, 2017 total $177,185.
The Debtor tells the Court that the sale of the its inventory
generates proceeds that may constitute cash or cash equivalents in
which Bank of America asserts a lien. However, Bank of America has
not consented to the Debtor's use of cash collateral past January
7, 2017.
Bank of America loaned funds to the Debtor in three facilities,
secured by the Debtor's equipment, fixtures, inventory, and
receivables. As of the Petition Date, the outstanding balance of
the Debtor's indebtedness to Bank of America was approximately
$791,611.
Accordingly, the Debtor proposes to provide Bank of America
replacement liens in new inventory purchased with proceeds from
sale of inventory subject to Bank of America's liens.
The Debtor has an urgent need to: (a) replenish inventory depleted
by holiday sales; (b) pay their employees (approximately 80 people)
on January 20, 2017; (c) avoid further disruption to their
businesses; (d) travel to and close certain underperforming stores;
(e) maintain the strength of the "Industrial Rideshop" brand; (f)
maintain customer loyalty; and (g) preserve the Debtors' going
concern value for the benefit of creditors while they formulate
their plan to emerge from bankruptcy.
The Debtor adds that without the use of cash, the Debtor's retail
enterprise's reorganizational prospects will be severely hampered
if not extinguished.
A full-text copy of the Debtor's Motion, dated January 12, 2017,
is available at https://is.gd/W5waCa
About Industrial Ride Shop, LLC
Industrial Ride Shop, LLC filed a Chapter 11 petition (Bankr. D.
Ariz. Case No. 16-14176), on December 16, 2016. The Petition was
signed by Douglas Butcher, managing member. The case is assigned
to Judge Brenda K. Martin. The Debtor is represented by Hilary L
Barnes, Esq. at Allen Barnes & Jones, PLC. At the time of filing,
the Debtor estimated both assets and liabilities at $1 million to
$10 million each.
INTOWN COMPANIES: Property Tax Claimholders to be Paid in 60 Months
-------------------------------------------------------------------
The Intown Companies, Inc., filed with the U.S. Bankruptcy Court
for the Northern District of Florida a disclosure statement dated
Jan. 16, 2017, referring to the Debtor's plan of reorganization.
Class 2 Property Tax Claims in Bay County, Florida, for 2012, 2013,
and 2014 real estate taxes will be allowed the full amount of their
outstanding claims, $121,934.62, as of Dec. 31, 2016.
2012 Real Estate Taxes (Bill 647640-I) will continue to be granted
interest on the total amount owed on the Effective Date of the Plan
at the certificate rate of 0.25%. The Debtor will pay interest
only payments towards the 2012 Real Estate Taxes for months one
through 36. The Debtor will pay principal and interest payments in
months 37 through 60 based upon the full outstanding balance with
the certificate rate of interest amortized over 24 months.
2013 Real Estate Taxes (Bill 674040-I) will continue to be granted
interest on the total amount owed on the Effective Date of the Plan
at the certificate rate of 0.25%. The Debtor will pay interest
only payments towards the 2013 Real Estate Taxes for months one
through 36. The Debtor will pay principal and interest payments in
months 37 through 60 based upon the full outstanding balance with
the certificate rate of interest amortized over 24 months.
2014 Real Estate Taxes (Bill 676950) will continue to be granted
interest on the total amount owed on the Effective Date of the Plan
at the statutory rate of 18%. The Debtor will pay principal and
interest payments in months one through 36 based upon the full
outstanding balance with the statutory rate of interest amortized
over 36 months.
Class 2 is impaired and therefore entitled to vote to accept or
reject this Plan. Class 2 retains all secured rights to the same
extent it held prior to the Petition Date.
The current operations of the Debtor will pay creditors of the
Debtor under this Plan from income generated through the operation
of the business. Additionally, the Debtor's management company,
American Motel Management, Inc., has agreed to collect no
management fee for the first year following the effective date of
the Plan and to reduce their monthly management fees for years two
through five to $3,000 monthly. All uncollected management fees
will accrue. American Motel will execute a management company
support agreement. Additionally, Melton Harrell has agreed to
infuse $100,000 on the Effective Date of the Plan into the Debtor's
operating account and has also agreed to additional protections
that will be as laid out in the attached plan support agreement.
The equity holders and insiders have also agreed to not take any
dividend, payment, distribution or loan from the Debtor for the
first three years as well as agreed to additional limitations as
shown on the attached Equity Support Agreement.
The Disclosure Statement is available at:
http://bankrupt.com/misc/flnb14-50374-377.pdf
As reported by the Troubled Company Reporter on Jan. 16, 2017, the
Debtor filed with the Court a combined disclosure statement and
Chapter 11 plan of reorganization dated Jan. 8, 2017, which
proposed that allowed General Unsecured Claims/Trade Creditors,
estimated at $22,515, would be paid 100% of their allowed claims
over five years with interest calculated at the federal judgment
rate that is in effect on the first date set for Confirmation in
monthly payments beginning on the first day of the first full month
following the Effective Date.
About The Intown Companies
The Intown Companies, Inc., dba American Quality Lodge, based in
Tucker, Georgia, filed a Chapter 11 petition (Bankr. N.D. Fla. Case
No. 14-50374) on Nov. 11, 2014. The Hon. Karen K. Specie presides
over the case. Thomas B. Woodward, Esq., of the law office of
Thomas B. Woodward, Atty., serves as bankruptcy counsel. The
Debtor also hired Jason A. Burgess, Esq., at The Law Offices of
Jason A. Burgess LLC, as its counsel.
In its petition, the Debtor estimated $1 million to $10 million in
both assets and liabilities. The petition was signed by Melton
Harrell, president.
No official committee of unsecured creditors has been appointed in
the case.
J. CREW: Bank Debt Trades at 46% Off
------------------------------------
Participations in a syndicated loan under J. Crew is a borrower
traded in the secondary market at 54.41 cents-on-the-dollar during
the week ended Friday, January 13, 2017, according to data compiled
by LSTA/Thomson Reuters MTM Pricing. This represents a decrease of
1.24 percentage points from the previous week. J. Crew pays 300
basis points above LIBOR to borrow under the $1.56 billion
facility. The bank loan matures on Feb. 27, 2021 and carries
Moody's Caa1 rating and Standard & Poor's CCC- rating. The loan is
one of the biggest gainers and losers among 247 widely quoted
syndicated loans with five or more bids in secondary trading for
the week ended January 13.
KINETIC CONCEPTS: S&P Affirms 'B' CCR & Revises Outlook to Pos.
---------------------------------------------------------------
S&P Global Ratings affirmed its 'B' corporate credit rating on
Kinetic Concepts Inc. and revised the outlook to positive from
stable.
At the same time, S&P lowered the rating on the first-lien debt due
2021 to 'B' from 'BB-' and revised the recovery rating to '3' from
'1'. The '3' recovery indicates expectations for meaningful
(50%-70%, upper end of the range) recovery in a default. S&P also
assigned a 'B' rating to the new first-lien debt with a '3'
recovery rating. The debt consists of a $1.125 million first-lien
term loan due 2024, a Euro equivalent $250 million first-lien term
loan due 2024, and a $300 million revolver due 2022. The borrowers
are Kinetic concepts Inc. and KCI USA Inc. The '3' recovery rating
indicates S&P's expectations for meaningful (50%-70%; upper end of
the range) recovery in a default.
In addition, S&P raised the rating on the third-lien debt to 'B-'
from 'CCC+' and revised the recovery rating to '5' from '6'. The
'5' recovery rating indicates expectations of modest recovery
(10%-30%, lower half of the range) in a default.
"The rating actions follow the sale of LifeCell to Allergan for
$2.9 billion and Kinetic Concepts' refinancing of its first-lien
debt," said S&P Global Ratings credit analyst Lucas Taylor. The
company plans to use proceeds from the sale to pay down debt, and
the lower overall EBITDA will be offset by a reduced overall debt
structure, resulting in leverage that is lower by about two turns.
While the company is smaller post-sale, S&P believes Kinetic will
maintain an adequate position within wound care, which supports
S&P's view of its fair business risk.
Previously, S&P considered Kinetic to be highly reliant on its
vacuum assisted closure (VAC) therapy (negative-pressure wound
therapy) sector, because it made up a dominant share of the
company's revenue. LifeCell, focused on regenerative and
reconstructive acellular tissue matrices and autologous fat
grafting solutions, provided some diversification and brand
awareness with its ALLODERM product. While S&P thinks the sale
affects overall diversification and further concentrates Kinetic's
efforts into VAC, it does not put the company in a materially worse
position than before, given that VAC remains a highly respected
product, Prevena Incision Management System continues to make
strides in developed markets, and the company is one of the
strongest contributors in the wound care space.
The divestiture of LifeCell has material implications on the
company's overall profitability. The LifeCell division had margins
that were significantly higher than overall company margins, which
provided ballast while the company struggled to grow. However, the
sale allows Kinetic to lower its leverage by repaying some of its
debt, although EBITDA margins will likely be about 300 basis points
lower. S&P now expects leverage in 2017 to be about 5.3x compared
with previous estimates of 7.4x.
The positive rating outlook on Kinetic Concepts Inc. incorporates
S&P's expectation that while adjusted debt leverage will remain
above 5.0x, the company will progressively deleverage and
substantially improve free cash flow. As a result, there is at
least a one in three chance of an upgrade over the next 12 months.
S&P could revise the outlook to stable if the sale of the LifeCell
business results in a market position that is materially worse for
Kinetic Concepts and its annualized cash flow remains under $75
million. S&P would revise its assessment of business risk if the
company experiences market share losses within the Advanced
Woundcare Therapeutics segment or if an influx of new competition
indicates lowered barriers to entry and an reduced ability to
effectively compete.
S&P would consider an upgrade if Kinetic Concepts managed to
increase its free cash flow profile such that it exceeded that of
similarly rated peers. This would require margins maintained at
33% and continued market share stability, which would help cash
flow rise above $75 million. An upgrade, though, would be
predicated on a reduction in working capital swings, which would
impart a sense of stability in the overall sources and uses of
capital.
KOPH INC: Authorized to Use Cash Collateral Through Feb. 10
-----------------------------------------------------------
Judge Jack B. Schmetterer of the U.S. Bankruptcy Court for the
Northern District of Illinois authorized Koph, Inc., to use First
Community Financial Bank's cash collateral from Jan. 10, 2017
through Feb. 10, 2017.
The Debtor is authorized to use cash collateral to pay the ordinary
and necessary post petition expenses related to the operation of
its restaurant business at 13717 S. Route 30, Plainfield, IL.
First Community is granted valid, perfected and enforceable
post-petition replacement liens on all proceeds of the existing
collateral, and all new collateral, to the extent that it had
perfected liens prepetition. First Community's post petition lien
will be superior in right to any other lien.
The Debtor is directed to make adequate protection payments of $600
to First Community on the first of each month, and continuing until
further order of the Court.
A hearing on the Debtor's motion for the continuing use of cash
collateral is continued to Feb. 7, 2017 at 10:30 a.m.
A full-text copy of the Order, dated January 10, 2017, is available
at https://is.gd/19Atlf
About Koph, Inc.
Koph, Inc., is a corporation that operates a restaurant known as
Katie O'Connor's Pint House and Eatery at 13717 S. Route 30 in
Plainfield, Illinois.
Koph, Inc., filed a chapter 11 petition (Bankr. N.D. Ill. Case No.
16-36244) on Nov. 14, 2016. The petition was signed by its
President, Robert J. Darin. The Debtor is represented by David P.
Lloyd, Esq., at David P. Lloyd, Ltd. At the time of filing, the
Debtor had less than $50,000 in estimated assets and $100,000 to
$500,000 in estimated liabilities.
LA4EVER LLC: Can Continue Using Cash Collateral Until Jan. 31
-------------------------------------------------------------
Judge Ann M. Nevins of the U.S. Bankruptcy Court for the District
of Connecticut authorized LA4Ever, LLC and LLCD, LLC to use the
cash collateral of Southport Secured Lending Fund, LLC through Jan.
31, 2017.
The Debtors are authorized to use use rentals or other funds in
accordance of the budget for the period from January 1, 2017,
through January 31, 2017. The Debtors were allowed to use cash of
up to the total amount of $5,910 to pay its operating expenses,
particularly, $3,660 for LA4Ever, LLC and $2,250 for LLCD, LLC.
The Debtors were also authorized to pay Southport Secured Lending
the amount of $9,967.
Southport Secured Lending is granted secured interests in all
post-petition rents and leases as the same may be generated, which
will be subordinate to all fees due to the Office of the U.S.
Trustee.
A continued hearing on the Debtors' use of cash collateral is
scheduled for Jan. 25, 2017 at 1:30 p.m.
A full-text copy of the Order, dated Jan. 10, 2017, is available at
https://is.gd/zu3doB
About LA4Ever LLC
LA4Ever, LLC, and LLCD, LLC, are Connecticut limited liability
companies officially registered with the Secretary of State in
December 2002 and January 2003. These companies were formed by and
are owned by Kenneth Hill and Daphne Benas. Since their formation
the Debtors have been in the business of ownership and operation of
residential rental property at 325-327 St. John Street and 23 Brown
Street, in New Haven, Connecticut. Mr. Hill and Ms. Benas also
oversaw extensive rehabilitation of the Property resulting in
significant improvement early on after the purchase. Many routine
management and maintenance duties at the Property are handled by
LABenhill, LLC, a management company formed, owned and operated by
Mr. Hill and Ms. Benas.
LLCD, LLC owns the Brown Street Property at 23 Brown Street in the
Wooster Square neighborhood in New Haven, Connecticut. The Brown
Street Property consists of five residential units representing a
current monthly rent roll of $6,250 inclusive of two units recently
vacated which vacancies are anticipated to be filled promptly.
LA4Ever, LLC, owns the St. John Street Property at 325-7 St. John
Street, also in the Wooster Square neighborhood in New Haven,
Connecticut. The St. John Street Property consists of six
residential units representing a current monthly rent roll of
$9,875. All six units of the St. John Street Property are
presently occupied.
The Debtors filed for Chapter 11 bankruptcy protection (Bankr. D.
Conn. Lead Case No. 15-30546) on April 8, 2015. The petition was
signed by Daphne Benas, member. The Debtors are represented by
Carl T. Gulliver, Esq., at Coan Lewendon Gulliver & Miltenberger,
LLC. The case is assigned to Judge Julie A. Manning.
At the time of the filing, LA4Ever estimated its assets at $500,000
to $1 million and debts at $1 million to $10 million. LLCD
estimated its assets and debt at $500,000 to $1 million.
No official committee of unsecured creditors has been appointed in
the case.
LESLIE'S POOLMART: Buyout No Immediate Impact on Moody's Ratings
----------------------------------------------------------------
Moody's Investors Service said that Leslie's Poolmart, Inc.'s (B2
stable, operating subsidiary of Leslie's Holdings, Inc.) ratings
and outlook are not immediately impacted by the announcement that
CVC Capital Partners has agreed to sell Leslie's Holdings, Inc. to
L Catterton and an affiliate of GIC.
Leslie's Poolmart, Inc. is a specialty pool supplies retailer that
operated 894 stores and commercial centers as of October 1, 2016.
Leslie's is jointly owned by CVC Capital Partners (majority
ownership) and Leonard Green & Partners. Revenues for the twelve
months ended October 1, 2016 were $798 million.
LIMITED STORES: Jan. 24 Meeting Set to Form Creditors' Panel
------------------------------------------------------------
Andy Vara, Acting United States Trustee for Region 3, will hold an
organizational meeting on Jan. 24, 2017, at 10:00 a.m. in the
bankruptcy case of Limited Stores Company, LLC.
The meeting will be held at:
Sheraton Suites
422 Delaware Avenue
Wilmington, DE 19801
The sole purpose of the meeting will be to form a committee or
committees of unsecured creditors in the Debtors' case.
The organizational meeting is not the meeting of creditors pursuant
to Section 341 of the Bankruptcy Code. A representative of the
Debtor, however, may attend the Organizational Meeting, and provide
background information regarding the bankruptcy cases.
To increase participation in the Chapter 11 proceeding, Section
1102 of the Bankruptcy Code requires that the United States Trustee
appoint a committee of unsecured creditors as soon as practicable.
The Committee ordinarily consists of the persons, willing to serve,
that hold the seven largest unsecured claims against the debtor of
the kinds represented on the committee.
Section 1103 of the Bankruptcy Code provides that the Committee may
consult with the debtor, investigate the debtor and its business
operations and participate in the formulation of a plan of
reorganization. The Committee may also perform other services as
are in the interests of the unsecured creditors whom it
represents.
About Limited Stores
Limited Stores Company, LLC, Limited Stores, LLC and The Limited
Stores GC, LLC comprise a multi-channel retailing company operating
under the name "The Limited," which specializes in the sale of
women's clothing.
Founded in 1963 as a single store, the Debtors expanded over the
past five decades to become a household name throughout the United
States for women's apparel. At its peak, the Debtors operated
approximately 750 retail brick and mortar store locations in the
United States as well as an e-commerce channel, which was
accessible through the Debtors' website at www.TheLimited.com.
Klehr Harrison Harvey Branzburg LLP serves as the Debtors' counsel.
Guggenheim Securities, LLC serves as the Debtors' investment
banker. RAS Management Advisors, LLC, acts as the Debtors'
restructuring advisor. Donlin, Recano & Company, Inc. serves as
the Debtors' notice, claims and balloting agent.
LIMITED STORES: Limited IP Buying Assets for $25.8 Million
----------------------------------------------------------
Limited Stores Co., LLC, and The Limited Stores GC, LLC, ask the
U.S. Bankruptcy Court for the District of Delaware to authorize the
sale of intellectual property and related assets to Limited IP
Acquisition, LLC, for $25,750,000.
Founded in 1963 as a single store, the Debtors expanded over the
past 5 decades to become a household name throughout the U.S. for
women's apparel. The Debtors' businesses focused on two channels:
(a) their primarily mall-based brick and mortar business and (b)
their online e-commerce business. Despite years of popularity and
expansion, the Debtors, like many other retailers, recently faced
significant operational challenges - including declining mall
traffic, an increase in online shopping, and disappointing sales -
resulting in a precipitous drop in EBITDA over the course of 2016.
As a result, the Debtors were forced to make difficult cost-cutting
decisions during the fourth quarter of 2016 to preserve liquidity
and maximize value for their stakeholders, including cancelling
orders of new inventory and undertaking a significant reduction in
force at their corporate headquarters.
In September 2016, the Debtors reignited their marketing efforts,
which initially began in late 2015, when the Debtors received, and
ultimately forwent, first an unsolicited offer to enter into a
joint venture involving the Intellectual Property, and subsequently
an offer to acquire 100% of the equity interests in the Company.
Spearheaded by Guggenheim Securities, LLC, over the ensuing five
months the Debtors exhaustively marketed their assets, exploring
various transaction structures, including transactions involving
the sale of the company as a whole including the Debtor’s brick
and mortar business and transactions centered on the Debtors'
Intellectual Property and e-commerce business.
As the process progressed, the Debtors received interest from
numerous potential purchasers. But despite several parties
expressing initial interest in a going concern transaction
involving the Debtors' brick and mortar business, the Debtors were
only able to obtain written indications of interest structured
around the Debtors' Intellectual Property. Thus, in December 2016,
with no new inventory arriving and a fixed liquidity runway, the
Debtors began an orderly and efficient liquidation process focused
on the twin goals of winding down their brick and mortar business
and selling their Intellectual Property and related assets while
still entertaining any interest expressed in the remaining brick
and mortar operations.
The first of these goals is complete, as the Debtors liquidated
substantially all of their inventory and ceased operations at all
of their approximately 250 brick and mortar locations prior to
commencement of the Chapter 11 cases. And the second of these
goals is also nearly complete. After seeking and obtaining several
new or revised indications of interest for just the Intellectual
Property and related assets, two parties entered into formal asset
purchase agreement negotiations. The Purchaser ultimately
prevailed as the successful bidder after more than two dozen rounds
of bidding, during which the cash portion of the purchase price
increased by approximately 72% and the Purchaser APA subsequently
was finalized. As a result, the Debtors are in the position of
beginning these chapter 11 cases with not only a purchaser of the
Assets, but with a purchase price that has been fully vetted and
competitively tested - yet still subject to higher or better offers
through a bankruptcy sale process.
But time is of the essence if the Debtors are to capitalize on the
work performed to date. Under the Purchaser APA, the Purchaser has
agreed to purchase the Assets for a cash purchase price of
$25,750,000 and assume the Selling Debtors' obligations under the
Executory Contracts. The Debtors have approximately $13,400,000 of
funded debt secured by the Assets and approximately $250,000 of
cash on hand. In addition, the Debtors anticipate that the
administrative expense of the Chapter 11 cases will be
approximately $3,400,000 per month prior to the anticipated closing
of the proposed Sale. Thus, the Debtors' ability to return any
value to their unsecured creditors is dependent on their ability to
efficiently proceed on the timeline proposed.
Specifically, the Debtors request that the Court approve this
timeline:
a. setting the Bid Protections Hearing to consider approval of
the Bid Protections to occur no later than 10 days after the
Petition Date;
b. setting the Sale Hearing to occur no later than 30 days after
the Petition Date;
c. setting the objection deadline and the deadline to submit
competing binding offers with respect to the Sale of the Assets to
be no later than 7 days prior to the Sale Hearing; and
d. setting the Auction, if any, to occur no later than 5 days
prior to the Sale Hearing.
The Debtors believe that this timeline is essential to maximizing
the value of their estates. Although the Debtors will welcome a
higher or better offer, a longer sale process is unlikely to yield
a material, if any, increase in the Debtors' prospects of receiving
a higher or better offer. Materially extending the sale process,
however, will increase the costs associated with these cases that
either is not supported by the proposed DIP Facility or will
diminish the potential value available for creditors of the
Debtors' estates. Delay could also lead to the Debtors becoming
unable to meet the Sale milestones in the Purchaser APA, which in
turn could result in the Purchaser terminating the Purchaser APA or
seeking to renegotiate the purchase price.
Consummating the Sale is an essential step in resolving these
chapter 11 cases and maximizing value to the Debtors' creditors.
Ultimately, the Debtors believe that the Sale of the Assets is a
sound exercise of their business judgment, and that the relief
requested in the Motion is in the best interests of their creditors
and all other parties in interest. Accordingly, the Court should
approve the relief requested.
The material terms of the APA are:
a. Sellers: Limited Stores, LLC and The Limited Stores GC, LLC
b. Limited IP Acquisition, LLC
c. Purchase Price: $25,750,000 and the assumption of certain
obligations.
d. Assets: The Sellers will sell and the Purchaser will
purchase: (i) all Intellectual Property owned by the Sellers,
including the right to sue for past, present, or future
infringement, misappropriation, dilution or other violation; (ii)
all of the Sellers' rights existing under certain Executory
Contracts and (iii) certain of the Sellers' other assets and (iv)
all Avoidance Actions with respect to MGF Sourcing US, LLC or any
of its subsidiaries and all rights thereunder.
e. Assumed Obligations: The Purchaser will assume all
liabilities of the Seller under the Executory Contracts.
f. Assumed Contracts: The Debtors will assume and assign to the
Purchasers certain Executory Contracts and the Purchaser will cure
any and all defaults under the Executory Contracts pursuant to
section 363 of the Bankruptcy Code.
g. Competitive Bidding: The Purchaser APA is subject to higher
or better offers, provided that (a) any such higher or better offer
qualifies as an Overbid and (b) any such Overbid is submitted to
the Debtors no later than the Bid Deadline.
h. Closing and Other Deadline: The Closing will occur no later
than the first business day after the date on which the closing
conditions have been satisfied. The closing conditions include the
entry by the Court of the Bid Protections Order and the Sale
Order.
i. Good-Faith Deposit: The Purchaser deposited an amount equal
to 5% of the Cash Portion of the purchase price ($1,287,500) into
an Escrow Account.
j. Use of Proceeds: The Cash Portion of the purchase price to be
applied in accordance with any Order of the Bankruptcy Court in
effect authorizing the Debtors' entry into any DIP Credit
Agreement.
k. Credit Bid: Pursuant to the terms of any order authorizing
the Debtors' entry into the DIP Credit Agreement, the Prepetition
Agent and the DIP Agent have preserved the right to credit bid
their obligations under the DIP Credit Agreement and Pre-Petition
Credit Agreement.
l. Relief from Bankruptcy Rule 6004(h): To maximize the value
received for the assets, the Debtors are seeking to close the Sale
as soon as possible after the hearing on the Motion. The Debtors,
therefore, have requested a waiver of the 14-day stay under
Bankruptcy Rule 6004(h).
m. Bid Protections: (i) Breakup Fee: A breakup fee equal to 3%
of the Cash Portion of the purchase price ($772,500), payable in
the event that the Purchaser APA is terminated and the Selling
Debtors consummate an alternative transaction; and (ii) Expense
Reimbursement: A reasonable expense reimbursement of up to $500,000
if the Purchaser APA is terminated. The Bid Protections will be an
administrative expense priority claim.
A copy of the Agreement atatched to the Motion is available for
free at:
http://bankrupt.com/misc/Limited_Stores_13_Sales.pdf
The Debtors seek entry of an order approving the Bid Protections.
The Bid Protections were a necessary component of the Purchaser's
bid, and the Debtors do not believe that the Purchaser would have
submitted a proposal, let alone permitted such proposal to be
subject to superior offers postpetition, without the Bid
Protections. Accordingly, the Debtors believe that the benefit of
the Purchaser APA outweighs the cost associated with the Bid
Protections.
To facilitate and effectuate the sale of the Assets, the Debtors
seek authority to assign or transfer the Executory Contracts to the
Purchaser or Overbid Purchaser arising from the Auction, if any, to
the extent required by such bidders.
In addition, the Debtors seek to only hold an Auction if they
obtain an Overbid that: (a) is a bulk bid to purchase all or
substantially all of the Assets; (b) clearly sets forth the
purchase price to be paid, including and identifying separately any
cash and non-cash components; (c) is accompanied by a cash deposit
in the amount equal to 5% of the Bid Price to be held in an escrow
account to be identified and established by the Debtors; (d)
provides consideration equal to or in excess of the sum of (i) cash
in an amount equal to $25,750,000, (ii) cash equal to the Bid
Protections ($1,272,500), and (iii) $250,000; and (e) that is
otherwise higher or better than the Purchaser APA, as determined in
the Debtors' business judgment; provided however that the DIP Agent
and Pre-Petition Agent will have the absolute right to credit bid
any portion or all of the Debtors' outstanding obligations under
the DIP Credit Agreement and the Pre-Petition Credit Agreement
pursuant to Bankruptcy Code section 363(k), with such amounts
treated the same as a cash bid of the equivalent amount, and
without being required to pay any deposit in respect of such credit
bid.
To ensure that the Debtors capture the full benefit of the
Purchaser APA, the Debtors seek entry of an order scheduling
certain dates and deadlines in connection with the Sale Hearing,
including an objection and competing bid deadline (7 days before
the Sale Hearing) and, if needed, an auction date (5 days before
the Sale Hearing). The Debtors believe that consummation of the
Sale in accordance with the timeframe contemplated herein will
maximize the value of the Assets and otherwise inure to the benefit
of their estates.
The Debtors ask that the Court schedule the Bid Protections Hearing
no later than Jan. 27, 2017. The Purchaser may terminate the
Purchaser APA if the Bid Protection Order is not entered before
Feb. 3, 2017. The Debtors further request that the objection
deadline regarding the Bid Protections be 2 days prior to the Bid
Protections Hearing.
The Debtors asks that the Court schedule the Sale Hearing no later
than Feb. 16, 2017. The Purchaser may terminate the Purchaser APA
if the Sale Order is not entered before Feb. 24, 2017. The Debtors
further ask that (a) the Sale Objection Deadline and Bid Deadline
be 7 days prior to such hearing and (b) the Auction, if any, to
occur no later than 5 days prior to the Sale Hearing.
The Debtors ask authority to consummate the Sale contemplated by
the Purchaser APA, free and clear of all liens, claims,
encumbrances, and interests pursuant to section 363 of the
Bankruptcy Code. In the Debtors' business judgment, consummating
the sale is in the best interests of their estates.
To maximize the certainty that the Sale will close and the Debtors
will realize the benefits of the Sale, the Debtors seek to close
the Sale as soon as possible after the Sale
Hearing. Accordingly, the Debtors ask that the Court waive the
14-day stay period under Bankruptcy Rules 6004(h) and 6006(d).
The Purchaser can be reached at:
LIMITED IP ACQUISITION, LLC
c/o Kirkland & Ellis LLP
300 North LaSalle Street
Chicago, IL 60654
Attn: James A. Stempel
Facsimile: (312) 862-2200
E-mail: james.stempel@kirkland.com
About Limited Stores
Limited Stores Company, LLC, Limited Stores, LLC and The Limited
Stores GC, LLC comprise a multi-channel retailing company
operating
under the name "The Limited," which specializes in the sale of
women's clothing.
Founded in 1963 as a single store, the Debtors expanded over the
past five decades to become a household name throughout the United
States for women's apparel. At its peak, the Debtors operated
approximately 750 retail brick and mortar store locations in the
United States as well as an e-commerce channel, which was
accessible through the Debtors' website at www.TheLimited.com.
Klehr Harrison Harvey Branzburg LLP serves as the Debtors'
counsel.
Guggenheim Securities, LLC serves as the Debtors' investment
banker. RAS Management Advisors, LLC, acts as the Debtors'
restructuring advisor. Donlin, Recano & Company, Inc. serves as
the Debtors' notice, claims and balloting agent.
LIVE OAK: Intends to Continued Using Cash Collateral Thru Feb. 28
-----------------------------------------------------------------
Live Oak Lounge, LLC, seeks authorization from the U.S. Bankruptcy
Court for the Northern District of Texas for continued use of cash
collateral to satisfy ordinary operating expenses of its business.
The Debtor has prepared a Monthly Budget reflecting projected
income and expenses for the months of January and February 2017.
The poposed Budget provides total cost of sales in the aggregate
sum of $260,552 and total general expenses of approximately
$91,926.
Claims secured by assets of Live Oak are asserted by the following
creditors:
(a) Ad valorem tax authorities of Tarrant County assert
claims for ad valorem property taxes for 2016 and prior years.
Tarrant County asserts a secured claim of $2,518 due and unpaid
2016 property taxes;
(b) PlainsCapital Bank asserts a claim of $23,652 as of the
Petition Date secured by Debtor's equipment, accounts, inventory
and general intangibles;
(c) The Department of Treasury - Internal Revenue Service
asserts a claim of $25,000 secured by all assets of the Debtor;
and
(d) Afallon Holdings LLC asserts a claim of $525,160.44
secured by office furniture and equipment.
The Debtor tells the Court that the interests of PlainsCapital Bank
and the IRS are adequately protected by the value of the deposits
on hand, together with inventory accounts and proceeds of same, and
the replacement lien granted pursuant to the Interim Cash
Collateral Order. The Debtor adds that PlainsCapital Bank and the
IRS have consented to the continued use of cash collateral through
February 28,2017.
A full-text copy of the Debtor's Motion, dated Jan. 17, 2017, is
available at https://is.gd/gFSDuD
A copy of the Debtor's Budget is available at https://is.gd/z2DUNj
About Live Oak Lounge
Live Oak Lounge, LLC, is a Texas Limited liability company formed
to provide an independent music venue, bar and restaurant in Fort
Worth, Texas. On July 8, 2016, Live Oak Lounge, LLC, commenced a
Chapter 11 case (Bankr. N.D. Tex. Case No. 16-42659). The petition
was signed by Robert Johnson, managing member. The bankruptcy case
was filed because Debtor's past mismanagement resulted in an IRS
tax lien exceeding $200,000.
The Debtor is represented by Warren V. Norred, Esq., at Norred Law,
PLLC. The Debtor estimated assets at $0 to $500,000 and liabilities
at $500,001 to $1 million at the time of the filing.
LIVE OAK: Second Amended Chapter 11 Plan of Liquidation Filed
-------------------------------------------------------------
Live Oak Lounge, LLC has filed with the U.S. Bankruptcy Court for
the Northern District of Texas its latest Chapter 11 plan of
liquidation.
The plan provides for the liquidation and winding up of the
company's financial affairs. Kimberly Kimbrough, Live Oak Lounge
manager, will be appointed as plan agent to oversee the liquidation
of the remaining assets of the company.
Under the liquidating plan, holders of allowed Class 6 unsecured
claims will only receive a pro rata distribution of the remaining
cash available if administrative expense claims, priority tax
claims and priority non-tax claims are paid in full.
Live Oak Lounge has sought court approval to sell almost all of its
assets to Live Oak on Lipscomb, LLC, for $80,000 cash, or to
another buyer with a better offer. Cash proceeds from the sale
will fund payments to holders of secured claims and administrative
claims, and depending on the ultimate sale price, to holders of
Class 6 unsecured claims.
Class 6 unsecured creditors assert a total of $712,233, of which
$524,160 is held by Afallon Holdings LLC, according to Live Oak
Lounge's disclosure statement for its second amended Chapter 11
plan of liquidation filed on Jan. 12.
A copy of the disclosure statement is available for free at:
https://is.gd/TRJKrr
Live Oak Lounge filed an initial plan of reorganization on Oct. 23
last year, which was conditionally approved by the court. On Nov.
26, the company filed its first amended plan of reorganization.
About Live Oak Lounge
Live Oak Lounge, LLC, is a Texas Limited liability company formed
to provide an independent music venue, bar and restaurant in Fort
Worth, Texas. On July 8, 2016, Live Oak Lounge, LLC, commenced a
Chapter 11 case (Bankr. N.D. Tex. Case No. 16-42659). The petition
was signed by Robert Johnson, managing member. The bankruptcy case
was filed because Debtor's past mismanagement resulted in an IRS
tax lien exceeding $200,000.
The Debtor is represented by Warren V. Norred, Esq., at Norred Law,
PLLC. The Debtor estimated assets at $0 to $500,000 and liabilities
at $500,001 to $1 million at the time of the filing.
MARRONE BIO: Shareholder Suit Settlement Gets Preliminary OK
------------------------------------------------------------
Marrone Bio Innovations, Inc., in its capacity as a nominal
defendant, entered into a Stipulation of Settlement on Nov. 15,
2016, in the shareholder derivative actions filed in the Superior
Court of the State of California, County of Yolo, against certain
current and former directors and officers of the Company and Ernst
& Young LLP, and against the Company as a nominal defendant.
On Jan. 11, 2017, the Court entered an order preliminarily
approving settlement and providing for notice. The Preliminary
Approval Order provides that the Court will hold a hearing for
final approval of the Stipulation on April 5, 2017, at 9:00 a.m.,
in Civil Department 7 of the Court, located at 1000 Main St.,
Woodland, California 95695.
About Marrone Bio
Marrone Bio makes bio-based pest management and plant health
products. Bio-based products are comprised of naturally occurring
microorganisms, such as bacteria and fungi, and plant extracts. The
Company's current products target the major markets that use
conventional chemical pesticides, including certain agricultural
and water markets, where the Company's bio-based products are used
as alternatives for, or mixed with, conventional chemical products.
The Company also targets new markets for which (i) there are no
available conventional chemical pesticides or (ii) the use of
conventional chemical pesticides may not be desirable or
permissible either because of health and environmental concerns
(including for organically certified crops) or because the
development of pest resistance has reduced the efficacy of
conventional chemical pesticides. All of the Company's current
products are approved by the United States Environmental Protection
Agency and registered as "biopesticides."
The Company reported a net loss of $43.7 million in 2015, a net
loss of $51.7 million in 2014, and a net loss of $31.2 million in
2013.
As of Sept. 30, 2016, Marrone Bio had $50.24 million in total
assets, $73.47 million in total liabilities and a total
stockholders' deficit of $23.23 million.
Ernst & Young LLP, in Sacramento, California, issued a "going
concern" qualification on the consolidated financial statements for
the year ended Dec. 31, 2015, citing that the Company has incurred
losses since inception, has a net capital deficiency, and has
restrictive debt covenants that raise substantial doubt about its
ability to continue as a going concern.
MATHIOPOULOS 3M: Allowed to Use Cash Collateral Until March 31
--------------------------------------------------------------
Judge Christopher M. Klein of the U.S. Bankruptcy Court for the
Eastern District of California authorized Mathiopoulos 3M Family
Limited Partnership to use cash collateral for the period February
1, 2017, and March 31, 2017.
The Debtor is authorized to use up to the aggregate sum of $5,168
per month, to pay operating expenses, particularly: property
insurance, Pacific Gas and Electric, Recology Auburn (for garbage),
telephone for business, pest control, telephone for fire and
security, life insurance policies, property maintenance, and other
miscellaneous expenses.
The Debtor is also authorized to pay these expenses: (a) Placer
County Water Agency the amount of $1,500 which will be due on
February 2017, (b) Sewer in the amount of $2,275 which will be due
March on 2017, and (c) Stanley Security for Fire Alarm in the
amount of $101 which will be due on March 2017.
Judge Klein granted the creditors having an interest in the cash
collateral with replacement liens in the post-petition rents in the
same priority, validity, and extent as they existed in the cash
collateral expended, to the extent that the use of cash collateral
resulted in a reduction of a creditors' secured claim.
The Debtor is directed to continue making the monthly adequate
protection payments of $13,632 to Wells Fargo Bank, N.A.
A hearing will be held on March 9, 2017 at 10:30 a.m. to consider a
supplement to the Motion to extend the authorization to use cash
collateral. The Debtor will file and serve supplemental pleadings
for the further use of cash collateral and notice of the March 9,
2017 hearing on or before February 23, 2017. Any opposition to the
requested use of cash collateral may be presented orally at the
hearing.
A full-text copy of the Order, dated Jan. 13, 2017, is available at
https://is.gd/3VoFin
About Mathiopoulis 3M
Mathioupoulos 3M Family Limited Partnership filed a Chapter 11
petition (Bankr. E.D. Ca. Case No. 16-20852) on Feb. 16, 2016. The
petition was signed by Diane M. Mathiopoulos, authorized
representative. The case is assigned to Judge Ronald H. Sargis.
The Debtor is represented by J. Luke Hendrix, Esq., at Desmond,
Nolan, Livaich & Cunningham. The Debtor disclosed total assets at
$5.36 million and total liabilities at $3.04 million.
METCOM NETWORK: Intends to File Chapter 11 Plan by April 22
-----------------------------------------------------------
Metcom Network Services, Inc., asks the U.S. Bankruptcy Court for
the Southern District of New York to extend the exclusive periods
during which only the Debtr may file a Chapter 11 plan and solicit
acceptances to the plan, through April 22, 2017 and June 20, 2017,
respectively.
The Debtor tells the Court that it leases five different locations
through which it operates its business: (a) 60 Hudson Street,
Suites 1001 and 2303, New York, NY 10013, (b) 75 Broad Street, New
York, NY 10004, (c) 4250 Veterans Memorial Highway, Suite 3150
West, Holbrook, NY 11741, (d) 80 Washington Street, Poughkeepsie,
NY 12601, and, (e) warehouse located at 190 Blydenburgh Road,
Islandia, NY 11749.
Currently, the Debtor has been attempting to obtain written consent
from all of its landlords to further extend its time to assume or
reject the Unexpired Leases through February 1, 2017. The Debtor
has already obtained two written consents thus far, and anticipates
receiving the other three the latest by January 23, 2017.
The Debtor contends that the most significant of these Unexpired
Leases is the 60 Hudson Street, New York, NY, which by its terms
expires in May 2017. The Debtor relates that at the commencement
of its chapter 11 case, the Debtor owed a significant amount of
pre-petition rental arrears in excess of $1.8 million to the
landlord on the 60 Hudson Lease, and this situation presented a
challenge to the Debtor in finding a buyer that would be willing to
purchase the Debtor's business as a going concern given the
significant amount necessary to cure the 60 Hudson Lease, and the
limited amount of time remaining on said lease.
The Debtor contends that until a recent settlement, it had also
been involved in ongoing litigation with N Plus Systems LLC
regarding N Plus' sublease of space in the Building from the
Debtor. The Debtor anticipated that it would be likely that any
party wishing to purchase the Debtor's business as a going concern
would require the resolution of its dispute with N Plus prior to
closing any such sale.
The Debtor relates that in the intervening months, the Debtor and
Epsilon US, Inc. engaged in arms' length, good faith negotiations
over the purchase transaction. The Debtor further relates that
Epsilon US has agreed to subject its transaction to higher and
better offers through a bidding and auction process as outlined in
the bidding procedures order, which was approved by the Court. A
sale hearing is scheduled to be held on January 30, 2017 at 11:00
a.m.
Accordingly, the Debtor submits that it requires more time to
consummate the Proposed Sale and formulate a confirmable chapter 11
plan of reorganization.
The Debtor also tells the Court that the total claims filed against
its estate is $4,493,099, consisting of $1,210,511 secured claims,
$716,926 priority claims, and $2,565,662 of unsecured claims.
Although the deadline that was fixed by the Bar Date Order for the
filing of proofs of claims for nongovernmental entities is October
26, 2016, and December 26, 2016 for all governmental entities, the
Debtor is still reviewing these claims and negotiating with its
creditors to attempt to reduce the amount of prepetition claims
against its estate.
About Metcom Network Services
Metcom Network Services, Inc. is a New York corporation, with its
principal place of business at 60 Hudson Street, New York, NY,
Suites 1001 and 2303. The Debtor is owned 50% by Mark DuMoulin,
Sr. and 50% by Susan BeckerDuMoulin. The Debtor is in the business
of telecommunications, building and local interconnection and
engineering support, including the colocation of customer
equipment.
The Debtor acts as a primary provider of extremely high capacity
fiber optic connections between domestic and international service
providers that occupy space throughout the Building located within
the structure of the Building itself.
Metcom Network Services, Inc. sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 16-11870) on June 28,
2016. The petition was signed by Mark DuMoulin, Sr., president.
The Debtor is represented by Neil H. Ackerman, Esq., at Ackerman
Fox, LLP. At the time of the filing, the Debtor estimated its
assets and liabilities at $1 million to $10 million.
No trustee, examiner, or committee of creditors has been appointed
in this case.
MRN HOMES: Seeks to Hire Will Geer as Legal Counsel
---------------------------------------------------
MRN Homes of Georgia, LLC seeks approval from the U.S. Bankruptcy
Court for the Northern District of Georgia to hire legal counsel in
connection with its Chapter 11 case.
The Debtor proposes to hire The Law Office of Will B. Geer, LLC to
give legal advice regarding its duties under the Bankruptcy Code,
conduct examination, assist in the preparation of a bankruptcy
plan, and provide other legal services.
The firm's attorneys and legal assistants will be paid $325 per
hour and $150 per hour, respectively.
Will Geer, Esq., disclosed in a court filing that his firm does not
hold or represent any interest adverse to the Debtor or its
bankruptcy estate.
The firm can be reached through:
Will B. Geer, Esq.
The Law Office of Will B. Geer, LLC
333 Sandy Springs Circle, NE, Suite 225
Atlanta, GA 30328
Phone: (678) 587-8740
Fax: (404) 287-2767
Email: willgeer@willgeerlaw.com
About MRN Homes of Georgia
MRN Homes of Georgia, LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N. D. Ga. Case No. 17-50831) on January 17,
2017. The petition was signed by James W. Hewatt, owner and
managing member.
The case is assigned to Judge Wendy L. Hagenau.
At the time of the filing, the Debtor estimated assets of less than
$1 million and liabilities of $1 million to $10 million.
MUSCLEPHARM CORP: Amerop Holdings Reports 9% Stake as of Jan. 4
---------------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, Amerop Holdings Inc disclosed that as of Jan. 4, 2017,
it beneficially owns 1,249,197 common shares of MusclePharm
Corporation representing 9 percent of the shares outstanding. A
full-text copy of the regulatory filing is available for free at:
https://is.gd/woHxvg
About MusclePharm
Headquartered in Denver, Colorado, MusclePharm Corporation (OTCQB:
MSLP) -- http://www.muslepharm.com/-- develops and manufactures a
full line of National Science Foundation approved nutritional
supplements that are 100 percent free of banned substances.
MusclePharm is sold in over 120 countries and available in over
5,000 U.S. retail outlets, including GNC and Vitamin Shoppe.
MusclePharm products are also sold in over 100 online stores,
including bodybuilding.com, Amazon.com and Vitacost.com.
MusclePharm reported a net loss of $51.85 million in 2015,
a net loss of $13.8 million in 2014 and a net loss of $17.7 million
in 2013.
As of Sept. 30, 2016, MusclePharm had $38.33 million in total
assets, $54.77 million in total liabilities and a total
stockholders' deficit of $16.44 million.
NAKED BRAND: Elects Messrs. Davis-Rice and Hanson as Directors
--------------------------------------------------------------
The Board of Directors of Naked Brand Group Inc. elected Justin
Davis-Rice and Edward Peter Hanson to serve as directors on the
until the Company's next annual meeting of stockholders or until
their earlier resignation or removal.
Mr. Rice is the executive chairman of Bendon Limited. Except with
respect to the Letter of Intent in which Mr. Rice has in interest
due to his position at Bendon, the Company said it has not entered
into any transactions with Messrs. Rice and Hanson.
On Dec. 19, 2016, the Company entered into a letter of intent with
Bendon Limited for a proposed merger of the companies, pursuant to
which a newly-formed, wholly-owned subsidiary of the Company would
merge with and into Bendon.
About Naked Brand
Naked Brand Group Inc. designs, manufactures, and sells men's
innerwear and lounge apparel products in the United States and
Canada. It offers various innerwear products, including trunks,
briefs, boxer briefs, undershirts, T-shirts, and lounge pants
under the Naked brand, as well as under the NKD sub-brand for men.
The company sells its products to consumers and retailers through
wholesale relationships and direct-to-consumer channel, which
consists of an online e-commerce store, thenakedshop.com. Naked
Brand Group Inc. is based in New York, New York.
Naked Brand reported a net loss of US$19.06 million on US$1.38
million of net sales for the year ended Jan. 31, 2016, compared to
a net loss of US$21.07 million on US$557,000 of net sales for the
year ended Jan. 31, 2015.
As of July 31, 2016, Naked Brand had US$2.99 million in total
assets, US$1.44 million in total liabilities and US$1.55 million in
total stockholders' equity.
BDO USA, LLP, in New York, NY, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Jan. 31, 2016, noting that the Company incurred a net loss of
$19,063,399 for the year ended Jan. 31, 2016, and the Company
expects to incur further losses in the development of its business.
This condition raises substantial doubt about the Company's
ability to continue as a going concern, the auditors said.
NAKED BRAND: Enters Into Letter of Intent to Merge with Bendon
--------------------------------------------------------------
Naked Brand Group Inc. and Bendon Limited have entered into a
letter of intent for a proposed merger of the companies. Expected
benefits of this proposed merger include:
* Bendon would gain immediate access to the U.S. capital
markets enabling it to further grow the business globally,
both organically and through future strategic acquisitions;
* The Naked brand would be able to leverage Bendon's well-
established global wholesale and retail distribution
channels;
* The combined entity would capitalize on the industry-leading
expertise of Carole Hochman, Naked's chief executive officer,
to strengthen its global intimate apparel and sleepwear brand
portfolio; and
* Operating synergies through integrated supply chain
management and administrative functions.
Bendon's brands include Heidi Klum Intimates and Swimwear, Stella
McCartney Lingerie and Swimwear, Bendon, Bendon Man, Davenport,
Evollove, Fayreform, Hickory, Lovable (in Australia and New
Zealand) and Pleasure State. Bendon's brands are distributed
globally through over 4,000 doors across 34 countries, as well as
through a growing network of 60 company-owned Bendon retail and
outlet stores in Australia, New Zealand and Ireland. Bendon is
headquartered in Auckland, and maintains additional offices in
Sydney, New York, London and Hong Kong. For the fiscal year ended
2016, Bendon generated approximately NZ $144 million (US $100
million) in net sales.
Ms. Hochman stated, "We are extremely excited about the potential
of this proposed merger, and look forward to capitalizing on
Bendon's scale and expertise to further expand the Naked brands.
The Bendon team has built a phenomenal business, and by leveraging
their infrastructure, product and geographic knowledge, and talent,
we believe that we can accelerate our growth in the innerwear
fashion and lifestyle market."
Justin Davis-Rice, executive chairman of Bendon, commented, "This
is a transformative merger that will create a powerful creative,
marketing, operational and capital markets platform. As a publicly
traded company in the U.S., we expect to have an opportunity to
accelerate our growth and strengthen our position as a global
leader in intimate apparel, swimwear, innerwear fashion and
lifestyle brands through both organic growth and strategic
acquisitions. We are also delighted to partner with industry
pioneer, Carole Hochman, who brings unrivalled experience to our
company and whose expertise is expected to not only strengthen our
existing brands but to provide us with an unprecedented opportunity
to develop our sleepwear business, a product category that
represents a significant growth opportunity."
Eric Watson, executive chairman of Cullen Investments, Bendon's
majority shareholder, added, "This is an incredible opportunity for
Bendon to strengthen its leadership in the industry and drive the
continued growth of the business as a consolidator of globally
recognized brands."
Carole Hochman, who will become chief creative officer of the
merged company, is considered one of the single most influential
women in the intimate apparel and sleepwear business in the United
States with experience that extends more than 30 years. She was
the driving force behind the Carole Hochman Design Group, for which
she served as chief creative officer until her departure in 2013
and for which she was previously CEO until its acquisition by Komar
in 2010. Under Carole's leadership, Carole Hochman Design Group
manufactured the Carole Hochman brand of sleepwear, loungewear and
daywear, in addition to numerous other sleepwear collections
including Christian Dior, Oscar de la Renta, Ralph Lauren, Jockey,
Donna Karan, Tommy Bahama and Betsey Johnson.
As stated in the LOI, Mr. Davis-Rice will join Naked's board of
directors, effective immediately. Concurrent with the completion
of the proposed Merger, Ms. Hochman would retain a seat on the
board of the combined company.
Terms of Letter of Intent
The LOI with Bendon provides that the Company would issue the
holders of ordinary shares of Bendon an aggregate of 118,812,163
shares of common stock of the Company, subject to adjustment,
representing approximately 93.6% of the combined company.
Completion of the Merger is subject to the negotiation of a
definitive merger agreement, satisfaction of the conditions
negotiated therein and approval of the Merger by the Company's
stockholders. Accordingly, there can be no assurance that a Merger
Agreement will be entered into or that the proposed Merger will be
consummated. Further, readers are cautioned that those portions of
the LOI that describe the proposed Merger, including the
consideration to be issued therein, are non-binding.
Pursuant to the terms of the LOI, the Company's management as well
as certain insiders will agree to sign voting agreements pursuant
to which each such person will grant a proxy and/or agree to vote
for the Merger at any meeting of stockholders. In addition, key
employees of Bendon will be offered employment with the Company, to
be effective upon completion of the Merger. Upon completion of the
Merger, the Board of the Company would be comprised of Ms. Hochman,
Mr. Davis-Rice and several additional members to be identified and
nominated by Bendon.
Pursuant to the terms of the LOI, the Company has agreed to adhere
to a no-shop provision until the earlier of the date the Merger
Agreement is executed or the LOI is terminated. If the Merger
Agreement is not executed by Feb. 10, 2017, or the Merger is not
consummated within six months thereafter, the Company will be
required to issue to Bendon 2.5 million shares of common stock;
provided, however, that the Company will not be required to issue
Bendon such shares if Bendon's actions or lack thereof has been the
principal cause of or resulted in the failure of the parties to
achieve a Merger Milestone.
Assuming Naked and Bendon enter into the Merger Agreement, the
parties will look to seek shareholder approval from Naked's
shareholders in the first quarter of 2017, subject to SEC review of
the proxy statement to be filed by the parties for the proposed
transaction.
A full-text copy of the LOI is available for free at:
https://is.gd/x5MMY8
About Bendon
Bendon is a global leader in intimate apparel and swimwear renowned
for its best in category innovation in design, and technology and
unwavering commitment to premium quality products throughout its
70-year history. Bendon has a portfolio of 10 highly productive
brands, including owned brands Bendon, Bendon Man, Davenport,
Evollove, Fayreform, Hickory, Lovable (in Australia and New
Zealand) and Pleasure State, as well as licensed brands Heidi Klum
Intimates and Swimwear and Stella McCartney Lingerie and Swimwear.
About Naked Brand
Naked Brand Group Inc. designs, manufactures, and sells men's
innerwear and lounge apparel products in the United States and
Canada. It offers various innerwear products, including trunks,
briefs, boxer briefs, undershirts, T-shirts, and lounge pants
under the Naked brand, as well as under the NKD sub-brand for men.
The company sells its products to consumers and retailers through
wholesale relationships and direct-to-consumer channel, which
consists of an online e-commerce store, thenakedshop.com. Naked
Brand Group Inc. is based in New York, New York.
Naked Brand reported a net loss of US$19.06 million on US$1.38
million of net sales for the year ended Jan. 31, 2016, compared to
a net loss of US$21.07 million on US$557,000 of net sales for the
year ended Jan. 31, 2015.
As of July 31, 2016, Naked Brand had US$2.99 million in total
assets, US$1.44 million in total liabilities and US$1.55 million in
total stockholders' equity.
BDO USA, LLP, in New York, NY, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Jan. 31, 2016, noting that the Company incurred a net loss of
$19,063,399 for the year ended Jan. 31, 2016, and the Company
expects to incur further losses in the development of its business.
This condition raises substantial doubt about the Company's
ability to continue as a going concern, the auditors said.
NAKED BRAND: Has 8.15 Million Outstanding Common Shares
-------------------------------------------------------
As previously disclosed, Naked Brand Group Inc. issued each of
Carole Hochman, David Hochman and Andrew Kaplan a convertible
promissory note in the principal amount of $112,000, $12,000 and
$100,000, respectively. In accordance with the terms and
conditions of the Notes, upon completion of the Offering, the
outstanding balance of each Note automatically converted into
shares of common stock. Ms. Hochman converted an outstanding
balance of $114,320 into 92,943 shares based on a conversion price
per share of $1.23 and Mr. Hochman and Mr. Kaplan converted an
outstanding balance of $12,210 and $101,751, respectively, into
11,740 shares and 97,837 shares based on a conversion price per
share of $1.04. Upon completion of the Offering and the issuance
of the shares upon conversion of the Notes, the Company has
8,152,313 shares of common stock outstanding.
The shares of common stock issued upon conversion of the Notes were
issued in reliance on the exemption from registration provided by
Section 4(a)(2) of the Securities Act of 1933, as amended, and/or
Rule 506 of Regulation D promulgated thereunder.
About Naked Brand
Naked Brand Group Inc. designs, manufactures, and sells men's
innerwear and lounge apparel products in the United States and
Canada. It offers various innerwear products, including trunks,
briefs, boxer briefs, undershirts, T-shirts, and lounge pants
under the Naked brand, as well as under the NKD sub-brand for men.
The company sells its products to consumers and retailers through
wholesale relationships and direct-to-consumer channel, which
consists of an online e-commerce store,
http://www.thenakedshop.com/
Naked Brand Group Inc. is based in New York, New York.
Naked Brand reported a net loss of US$19.06 million on US$1.38
million of net sales for the year ended Jan. 31, 2016, compared to
a net loss of US$21.07 million on US$557,000 of net sales for the
year ended Jan. 31, 2015.
As of July 31, 2016, Naked Brand had US$2.99 million in total
assets, US$1.44 million in total liabilities, and US$1.55 million
in total stockholders' equity.
BDO USA, LLP, in New York, NY, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Jan. 31, 2016, noting that the Company incurred a net loss of
$19,063,399 for the year ended Jan. 31, 2016, and the Company
expects to incur further losses in the development of its business.
This condition raises substantial doubt about the Company's
ability to continue as a going concern, the auditors said.
NAKED BRAND: Offering $1.9 Million Worth of Common Stock
--------------------------------------------------------
Naked Brand Group Inc. announced that the Company has entered into
a securities purchase agreement for the sale of shares of its
common stock in a registered direct offering to investors. The
Company is selling 1,879,811 shares at a purchase price of $1.04
per share with gross proceeds to the Company totaling $1.955
million.
The proceeds from the offering will be used to provide working
capital for general corporate purposes and to support Naked's
ongoing operations through the estimated timeframe to completion of
its proposed merger with Bendon Limited.
The shares are being offered by Naked pursuant to a shelf
registration statement on Form S-3 (File No. 333-213965) which was
declared effective on Oct. 19, 2015, by the Securities and Exchange
Commission. A prospectus supplement and accompanying base
prospectus relating to the offering of the shares will be filed
with the SEC and will be available on the SEC's website at
http://www.sec.gov. Copies of the prospectus supplement and the
accompanying base prospectus relating to the securities may also be
obtained from Naked Brand Group Inc., 95 Madison Avenue, 10th
Floor, New York, NY 10016.
About Naked Brand
Naked Brand Group Inc. designs, manufactures, and sells men's
innerwear and lounge apparel products in the United States and
Canada. It offers various innerwear products, including trunks,
briefs, boxer briefs, undershirts, T-shirts, and lounge pants
under the Naked brand, as well as under the NKD sub-brand for men.
The company sells its products to consumers and retailers through
wholesale relationships and direct-to-consumer channel, which
consists of an online e-commerce store, thenakedshop.com. Naked
Brand Group Inc. is based in New York, New York.
Naked Brand reported a net loss of US$19.06 million on US$1.38
million of net sales for the year ended Jan. 31, 2016, compared to
a net loss of US$21.07 million on US$557,000 of net sales for the
year ended Jan. 31, 2015.
As of July 31, 2016, Naked Brand had US$2.99 million in total
assets, US$1.44 million in total liabilities and US$1.55 million in
total stockholders' equity.
BDO USA, LLP, in New York, NY, issued a "going concern"
qualification on the consolidated financial statements for the year
ended Jan. 31, 2016, noting that the Company incurred a net loss of
$19,063,399 for the year ended Jan. 31, 2016, and the Company
expects to incur further losses in the development of its business.
This condition raises substantial doubt about the Company's
ability to continue as a going concern, the auditors said.
NAVISTAR INTERNATIONAL: Closes Sale of $250M 8.25% Senior Notes
---------------------------------------------------------------
Navistar International Corporation completed the sale of
$250,000,000 aggregate principal amount of its 8.25% Senior Notes
due 2021, pursuant to the terms of the underwriting agreement dated
Jan. 12, 2017, among the Company, Navistar, Inc., a Delaware
corporation, and Merrill Lynch, Pierce, Fenner & Smith
Incorporated, as representative of the several underwriters.
The Underwriting Agreement contains customary representations,
warranties and covenants. Under the terms of the Underwriting
Agreement, the Company sold the Notes at a price to public equal to
100.0% of the principal amount thereof, plus accrued interest, if
any, from Nov. 1, 2016, to, but excluding, the closing date, and
has agreed to indemnify the Underwriters against certain
liabilities.
The Notes were issued as additional notes pursuant to an indenture,
dated Oct. 28, 2009, among the Company, the Guarantor and The Bank
of New York Mellon Trust Company, N.A., as trustee, under which the
Company previously issued $1.3 billion in aggregate principal
amount of 8.25% senior notes due 2021, of which $1.2 billion
remains outstanding. The Notes will be treated together with the
Existing Senior Notes as a single series of debt securities and
will have the same terms as and be fungible with the Existing
Senior Notes. The Company expects to use the net proceeds of the
Offering for general corporate purposes, including working capital
and capital expenditures.
The Notes are registered under the Securities Act of 1933, as
amended, pursuant to the Company's Registration Statement on Form
S-3 (Registration No. 333-213745) filed by the Company with the
Securities and Exchange Commission on Sept. 22, 2016, and which was
subsequently declared effective on Oct. 5, 2016.
About Navistar International
Navistar International Corporation (NYSE: NAV) --
http://www.navistar.com/-- is a holding company whose
subsidiaries and affiliates subsidiaries produce International(R)
brand commercial and military trucks, MaxxForce(R) brand diesel
engines, IC Bus(TM) brand school and commercial buses, Monaco RV
brands of recreational vehicles, and Workhorse(R) brand chassis
for motor homes and step vans. It also is a private-label
designer and manufacturer of diesel engines for the pickup truck,
van and SUV markets. The Company also provides truck and diesel
engine parts and service. Another affiliate offers financing
services.
Navistar reported a net loss attributable to the Company of $97
million on $8.11 billion of net sales and revenues for the year
ended Oct. 31, 2016, compared to a net loss attributable to the
Company of $184 million on $10.14 billion of net sales and revenues
for the year ended Oct. 31, 2015.
As of Oct. 31, 2016, Navistar had $5.65 billion in total assets,
$10.94 billion in total liabilities and a total stockholders'
deficit of $5.29 billion.
* * *
In the July 22, 2015, edition of the TCR, Moody's Investors Service
affirmed Navistar's Corporate Family Rating at 'B3' and assigned a
'Ba3' rating to Navistar, Inc.'s new $1.04 billion senior secured
term loan due 2020.
Navistar carries a 'CCC' Issuer Default Ratings from Fitch
Ratings.
As reported by the TCR on Sept. 13, 2016, S&P Global Ratings placed
its ratings, including the 'CCC+' corporate credit ratings, on
Navistar on CreditWatch with positive implications.
NEIMAN MARCUS: Bank Debt Trades at 15% Off
------------------------------------------
Participations in a syndicated loan under Neiman Marcus Group Inc
is a borrower traded in the secondary market at 85.47
cents-on-the-dollar during the week ended Friday, January 13, 2017,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 1.54 percentage points from the
previous week. Neiman Marcus pays 300 basis points above LIBOR to
borrow under the $2.9 billion facility. The bank loan matures on
Oct. 16, 2020 and carries Moody's B2 rating and Standard & Poor's
B- rating. The loan is one of the biggest gainers and losers among
247 widely quoted syndicated loans with five or more bids in
secondary trading for the week ended January 13.
NEOVASC INC: To Seek Expedited Appeal of "CardiAQ" Suit Judgment
----------------------------------------------------------------
Neovasc Inc. announced an update in its ongoing litigation with
CardiAQ Valve Technologies, Inc.
On Jan. 18, 2017, in the litigation filed against the Company by
CardiAQ in the U.S. District Court for the District of
Massachusetts, the trial court granted CardiAQ's motion for pre-
and post-judgment interest. The Court awarded US$20,675,154 in
pre-judgment interest and assessed a running rate of US$2,354 per
day from Nov. 16, 2016, until the judgment is satisfied, unless the
Company prevails on appeal.
As previously disclosed, the judgment, including these amounts, is
currently stayed pending completion of the upcoming appeal pursuant
to a Court order of Dec. 23, 2016.
The Company intends to seek an expedited appeal of the judgment,
including the underlying damages award upon which these figures
were calculated, before the United States Court of Appeals for the
Federal Circuit.
About Neovasc Inc.
Neovasc Inc. (CVE:NVC) -- http://www.neovasc.com/-- is a Canadian
specialty medical device company that develops, manufactures and
markets products for the rapidly growing cardiovascular
marketplace. Its products in development include the Tiara, for
the transcatheter treatment of mitral valve disease and the Neovasc
Reducer for the treatment of refractory angina. The Company also
sells a line of advanced biological tissue products that are used
as key components in third-party medical products including
transcatheter heart valves.
Neovasc reported a net loss of US$26.73 million for the year ended
Dec. 31, 2015, compared to a net loss of US$17.17 million for the
year ended Dec. 31, 2014.
As of Sept. 30, 2016, Neovasc had US$33.83 million in total assets,
US$93.45 million in total liabilities and a total deficit of
US$59.61 million.
NEW YORK TIMES: S&P Affirms Then Withdraws 'BB-' CCR
----------------------------------------------------
S&P Global Ratings said that it affirmed its 'BB-' corporate credit
rating on U.S. newspaper publisher The New York Times Co. The
rating outlook is stable.
S&P then withdrew the rating at the company's request. The
withdrawal follows New York Times' repayment of the outstanding
balance of its senior secured notes in December 2016. The company
no longer has any rated debt.
NEXXLINX CORP: Unsecured Creditors to Get 27% Under Latest Plan
---------------------------------------------------------------
Unsecured creditors of NexxLinx Corporation, Inc., will be paid 27%
of their claims, according to the company's latest Chapter 11 plan
of reorganization.
NexxLinx's initial plan, filed on Oct. 4 last year, proposed to pay
unsecured creditors 23.3% of their claims.
Under the latest restructuring plan, the reorganized company will
contribute $1.4 million over the life of the plan to a creditor
trust. Additionally, the plan provides for contingent annual
"profit sharing" payments to holders of Class 9 unsecured claims in
an estimated total amount of $331,271.
Holders of an allowed Class 9 unsecured claim will receive payment
of a proportionate share of the funds in the creditor trust equal
to their pro rata share, according to NexxLinx's disclosure
statement filed on Jan. 12 filed with the U.S. Bankruptcy Court for
the Northern District of Georgia.
A copy of the latest disclosure statement is available for free
at:
https://is.gd/s63DqF
About NexxLinx Corporation
NexxLinx Corporation, Inc. provides cloud-based outsourced business
process and marketing services. The company designs custom
solutions for inbound and outbound customer care, telemarketing and
data collection, help desk, e-mail processing, live Web and voice
interaction, and back-end data processing. It also provides
multichannel communication, customer retention, inbound sales
conversion, government contact center, back office support,
technical support, and fulfillment solutions.
NexxLinx sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. N.D. Ga. Case No. 16-61225) on June 28, 2016. The petition
was signed by D. Alan Quarterman, CEO. The Company has estimated
assets and liabilities of $10 million to $50 million.
These affiliates also sought Chapter 11 protection on June 28:
CustomerLinx of North Carolina, Inc., Microdyne Outsourcing, Inc.,
NexxLinx Global, Inc., NexxLinx of New York, Inc., and NexxLinx of
Texas, Inc.
The court on June 30, 2016, entered an order jointly administering
the Chapter 11 cases.
NexxPhase, Inc. filed a Chapter 11 petition (Bankr. N.D. Ga. Case
No. 16-62269) on July 14, 2016.
The cases are assigned to Judge Paul Baisier. The Debtors are
represented by Ashley Reynolds Ray, Esq., and J. Robert Williamson,
Esq., at Scroggins & Williamson, P.C. GGG Partners, LLC serves as
the Debtors' financial consultant.
Guy Gebhardt, acting U.S. trustee for Region 21, on July 11, 2016,
appointed five NexxLinx creditors to serve on the official
committee of unsecured creditors. The committee has retained Mark
I. Duedall, Esq., at Bryan Cave LLP, as counsel.
NORTHPORT BAY: Seeks Authorization to Use National Cash Collateral
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Northport Bay Inc. seeks authorization from the U.S. Bankruptcy
Court for the Eastern District of New York to use cash collateral
in which National Loan Investors may assert a security interest.
The Debtor is in the business of renting out apartments and
commercial space in its real property located at 45 Bayview Avenue,
Inwood, NY 11096. The Debtor receives approximately $10,230 per
month from the operation of its business, and approximately $9,800
of which amount is subject to National Loan Investors' security
interest.
The Debtor intends to use cash collateral to pay its ordinary and
necessary expenses in the approximate amount of $6,465, which
includes mortgage, natural gas for heating water, and maintaining
the real property. The Debtor contends that if it is not allowed
to pay these expenses, the tenants of the real property may be able
to rightfully withhold payment of rent, which would harm the Debtor
and its estate.
The Debtor believes that National Loan Investors is the only entity
with a security interests in the rents from its real property. The
Debtor relates that it has granted a promissory note to Banco
Popular North American, secured with a mortgage against the
Debtor's real property, in addition to an assignment of rents from
the real property. Subsequently, Banco Popular assigned to
National Loan Investors the mortgage and assignment of rents.
The Debtor tells the Court that National Loan Investors is
adequately protected because of the equity cushion existing in the
real property. Nevertheless, that Debtor proposes to pay National
Loan Investors $3,068 per month, which constitutes the monthly
pre-default amount due, including interest, on the 2012 and 2013
Note.
A full-text copy of the Debtor's Motion, dated Jan. 17, 2017, is
available at https://is.gd/FPpLNY
A copy of the Debtor's Budget is available at https://is.gd/QXOqKt
About Northport Bay
Northport Bay, Inc., aka 45 Bay Holdings filed a Chapter 11
bankruptcy petition (Bankr. E.D.N.Y. Case No. 16-75598) on December
2, 2016. The Petition was signed by Sandra Nicholas, Vice
President. Initially, Jeff P. Prostok, Esq., at Forshey & Prostok,
LLP serves as bankruptcy counsel. At the time of filing, the
Debtor's assets and liabilities were estimated to be between $1
million to $10 million each.
Currently, the Debtor is represented by Andrew Thaler, Esq. at
Thaler Law Firm PLLC.
OLMOS EQUIPMENT: Pres. to Contribute $50K to Pay Unsecured Claims
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Larry Struthoff, president of Olmos Equipment Inc., will contribute
$50,000 to pay a portion of unsecured claims, according to the
company's latest Chapter 11 plan of reorganization.
Under the latest plan, holders of Class 7 unsecured claims will
also receive their pro rata share of the $50,000 contribution to be
made by Struthoff through an entity he owns.
That is aside from the unencumbered funds generated from the sale
of assets, collection of receivables or any claims that unsecured
creditors will receive after payment in full of Class 6 priority
claims, according to Olmos' latest disclosure statement filed on
Jan. 12 with the U.S. Bankruptcy Court for the Western District of
Texas.
A copy of the latest disclosure statement is available for free
at:
https://is.gd/NeybEL
About Olmos Equipment
Olmos Equipment Inc. filed a Chapter 11 petition (Bankr. W.D. Tex.
Case No. 16-51834) on Aug. 12, 2016. The petition was signed by
Larry Struthoff, president. The Debtor is represented by William
B. Kingman, Esq., at the Law Offices of William B. Kingman, PC. The
case is assigned to Judge Craig A. Gargotta. The Debtor estimated
assets at $1 million to $10 million and liabilities at $10 million
to $50 million at the time of the filing.
Judge Craig A. Gargotta, the United States Bankruptcy Judge for the
District of Texas, entered an order approving the appointment of
Randolph N. Osherow as Chapter 11 Examiner for the Debtor, Olmos
Equipment, Inc.
ONVOY LLC: Moody's Assigns B2 Corp. Family Rating
-------------------------------------------------
Moody's Investors Service has assigned a first-time B2 corporate
family rating (CFR) and a B2-PD probability of default rating (PDR)
to Onvoy, LLC. Moody's has also assigned a B1 (LGD3) rating to the
company's proposed $535 million senior secured 1st lien credit
facility which consists of a $500 million 7 year term loan and a
$35 million 5 year revolver. The company will also issue a second
lien term loan which Moody's will not rate. The proceeds from the
secured credit facilities will be used to fund the acquisition of
Inteliquent, Inc. ("Inteliquent"), an interconnection partner for
communications service providers, and to repay existing debt.
Issuer: Onvoy, LLC
Assignments:
Probability of Default Rating, Assigned B2-PD
Corporate Family Rating, Assigned B2
Senior Secured 1st Lien Term Loan, Assigned B1 (LGD3)
Senior Secured 1st Lien Revolving Credit Facility, Assigned B1
(LGD3)
Outlook Actions:
Outlook, Assigned Stable
RATINGS RATIONALE
Onvoy's B2 CFR reflects its large network infrastructure, technical
expertise and growth potential which is driven by its expanding
network footprint. Onvoy is a specialty provider of network
infrastructure services to communications companies. By aggregating
traffic and focusing on the core network, Onvoy can offer its
customers a cheaper alternative to owning and operating their own
voice networks. Also, as voice continues to evolve as an
application offered in conjunction with managed services, Onvoy can
capture more volume growth from non-traditional providers of
unified communications services. The rating is also supported by
the company's strong liquidity profile.
Onvoy offers both legacy telecommunications services as well as
next generation voice connections and terminations. Although the
total market volume of voice traffic is in a state of long term
decline, Onvoy continues to enjoy healthy margins from its legacy
operations, particularly switching, which contributes to strong
cash flow generation. Onvoy is also well positioned to capture
volumes as carriers look to outsource their voice traffic and new
providers enter the market. Further, with the acquisition of
Inteliquent, the company will aim to improve its position as a
provider of non-direct (or off-net) interconnection services. In
August of 2015, Inteliquent entered into an agreement to perform
such services for T-Mobile. The company expects other retail
communication providers to engage in similar partnerships leading
to substantial growth.
The rating is constrained by inherent business and technology risk
in Onvoy's operations and its small scale which limits its ability
to absorb unexpected disruptions to its business. Nearly all of
Onvoy's revenue is variable and driven by call volume, and Moody's
expects the total market call volume to continue to decline over
the long term as people shift to other communication modes.
Further, as a wholesale provider of a commodity-like service,
prices and margins are already extremely low which limits Onvoy's
ability to grow cash flows. Switching costs are minimal for Onvoy's
customers and traffic can migrate quickly to other providers.
Moody's believes that Onvoy will be a price-taker and must maintain
a cost advantage to maintain profitability.
Moody's expects Onvoy to have leverage of near 6x (Moody's
adjusted) immediately following the transaction close, trending
below 5x by fiscal year ending June 30, 2018 due to EBITDA growth.
The company's low capital spending requirements at approximately 5%
of revenue and good margins in the mid 20% range result in positive
free cash flow. In addition,
Moody's anticipates that Onvoy will recognize substantial cost
synergies following the combination of Onvoy and Inteliquent
because of their overlapping network footprints. Rerouting Onvoy's
traffic onto Inteliquent's network will lead to the majority of
cost savings in addition to SG&A redundancies.
Moody's expects Onvoy to have good liquidity over the next twelve
months and expects the company to have approximately $20 million of
cash on the balance sheet and an undrawn $35 million revolving
credit facility following the close of the transaction. The
revolver will contain a springing leverage covenant, which Moody's
expects to be set with ample cushion in the new credit agreement.
Onvoy has limited tangible assets that could be monetized for
alternate liquidity as its assets are encumbered by the secured
bank facilities.
The ratings for debt instruments reflect both the probability of
default of Onvoy, to which Moody's assigns a PDR of B2-PD, and
individual loss given default assessments. The senior secured first
lien credit facilities are rated B1 (LGD3), one notch higher than
the CFR, given the loss absorption provided by the unrated 2nd lien
facilities.
The stable outlook reflects Moody's view that Onvoy will continue
to grow revenue and EBITDA pushing leverage below 5x (Moody's
adjusted) by fiscal year end 2018.
The B2 rating could upgraded if leverage is sustained below 4x
(Moody's adjusted) and free cash flow to debt is at least 10%. The
rating could be downgraded if liquidity deteriorates, if free cash
flow weakens or if leverage is not on track to fall below 5x
(Moody's adjusted) by fiscal year end 2018.
The principal methodology used in these ratings was "Global
Communications Infrastructure Rating Methodology" published in June
2011.
Based in Minneapolis, MN, Onvoy is a provider of network based
communications enablement services. During the last twelve months
ending Sept 30, 2016, the company generated $561 million in revenue
pro-forma for the announced acquisition of Inteliquent.
PARAGON OFFSHORE: MER Group Buying Paragon MSS2 for $219K
---------------------------------------------------------
Paragon Offshore PLC, and its affiliates ask the U.S. Bankruptcy
Court for the District of Delaware to authorize the private sale by
Paragon Drilling Services 7, LLC ("Seller") of MSS2, including
related assets, to MER Group Puerto Rico, LLC, for approximately
$219,160.
The proposed hearing on the Motion is on Jan. 25, 2017 at 1:00 p.m.
(ET). The proposed objection deadline is Jan. 24, 2017 at 12:00
p.m. (ET).
The MSS2 is a semi-submersible offshore drilling rig, currently
cold-stacked at the MER Group Facility, Pier 3, Roosevelt Road,
Ceiba, Puerto Rico ("MER Facility"). The MSS2 has been
cold-stacked at its current location since April 2016, subsequent
to the termination of the Debtors' contract for drilling services
with Petroleo Brasileiro S.A. ("Petrobras"). The cost to stack the
Rig at the MER Facility is approximately $102,000 per month.
The MSS2 is approximately 40 years old, and is at the end of its
useful life. The Debtors estimate that the required survey and
repair work to refurbish the Rig would be approximately $44,000,000
to $58,000,000. Subsequent to the termination of the Debtors'
contract with Petrobras in April 2016, the Debtors have been unable
to procure new work for the Rig that would justify the required
refurbishment costs. After the Petrobras contract terminated, the
Debtors examined several locations to cold-stack the Rig.
Due to the size and design of the Rig, the Debtors determined that
a viable cold-stacking location did not exist in South America and
that the movement of the Rig would require a significant capital
expenditure.
The Debtors' current Business Plan contemplates the Debtors
scrapping the MSS2 in February 2017. The Debtors are executing on
the Business Plan by consummating the scrapping of the Rig before
Jan. 31, 2017, enabling them to save the unnecessary costs
associated with cold-stacking the Rig for an additional month.
Pursuant to the Agreement, the Seller, owner of the MSS2, has
negotiated a contract to sell the MSS2 to the MER Facility, for
purposes of scrapping and recycling.
The salient terms of the Agreement are:
a. Sale and Purchase of the MSS2: The Debtors have agreed to
sell, and the Buyer has agreed to purchase the MSS2, for the
purpose of recycling only.
b. Deposit: Within 7 business days after the mutual execution of
the Agreement, the Buyer will pay the Debtors a deposit equal to
10% of the sale price, or approximately $21,916. The Deposit may
only be refunded to the Buyer: (i) if the Closing does not occur
before Feb. 7, 2017 by reason of breach of the Agreement by the
Seller and the Buyer terminates the Agreement; (ii) if the Seller
is unable to obtain either: (a) Bankruptcy Court Approval on Jan.
31, 2017 or (b) the release of the Mortgage on or before the
Closing Date, and the Buyer terminates the Agreement; or (iii) the
Agreement terminates upon the Total Loss of the Rig.
c. Payment of Purchase Price: The sale price for the MSS2 is
approximately $219,160 in cash (calculated on the basis of
approximately $20 per long ton of the agreed lightweight of the
Rig).
d. Private Sale: The Agreement contemplates a private sale.
e. Sale Motion and Order: The Agreement will not be effective or
binding on the Debtors unless the Court enters a final order
approving the Agreement.
f. Sale Free and Clear: The Agreement contemplates that the MSS2
will be sold free and clear of all liens (other than certain
Permitted Liens).
g. Relief from Bankruptcy Rule 6004(h): The parties
contemplated, and the Motion requests, that the 14-day stay under
Bankruptcy Rule 6004(h) be waived.
A copy of the Agreement attached to the Motion is available for
free at:
http://bankrupt.com/misc/Paragon_Offshore_1025_Sales.pdf
The Debtors' decision to conduct a private sale, as opposed to a
public auction, of the MSS2 on the terms set forth in the Agreement
reflects a reasonable exercise of their business judgment. At
approximately 40 years old, the MSS2 has reached the end of its
useful life. It currently costs the Debtors approximately $102,000
per month, to stack the Rig, an expense that the Debtors will avoid
by scrapping the Rig. In addition, the sale will generate proceeds
of over $200,000. By selling the Rig to the MER Facility prior to
Jan. 31, 2017, the Debtors hope to avoid these unnecessary and
burdensome costs. Accordingly, the Debtors ask the Court to approve
the sale of MSS2 free and clear of all liens, claims, encumbrances,
and other interests.
The Debtors ask that any order approving the sale of the MSS2 be
effective immediately upon entry of such order by providing that
the 14-day stay will not apply. If the Debtors do not close the
Sale by Jan. 31, 2017, they run the risk of incurring substantial,
unnecessary costs upon the termination of their docking agreement.
Accordingly, the Debtors submit that the 14-day stay required by
Bankruptcy Rule 6004(h) should be waived.
About Paragon Offshore
Paragon Offshore plc -- http://www.paragonoffshore.com/-- is a
global provider of offshore drilling rigs. Paragon's operated
fleet includes 34 jackups, including two high specification heavy
duty/harsh environment jackups, and six floaters (four drillships
and two semi-submersibles). Paragon's primary business is
contracting its rigs, related equipment and work crews to conduct
oil and gas drilling and workover operations for its exploration
and production customers on a dayrate basis around the world.
Paragon's principal executive offices are located in Houston,
Texas. Paragon is a public limited company registered in England
and Wales and its ordinary shares have been trading on the
over-the-counter markets under the trading symbol "PGNPF" since
December 18, 2015.
Paragon Offshore Plc, et al., filed Chapter 11 bankruptcy
Petitions
(Bankr. D. Del. Case Nos. 16-10385 to 16-10410) on Feb. 14, 2016,
after reaching a deal with lenders on a reorganization plan that
would eliminate $1.1 billion in debt.
The petitions were signed by Randall D. Stilley as authorized
representative. Judge Christopher S. Sontchi is assigned to the
cases.
The Debtors reported total assets of $2.47 billion and total debt
of $2.96 billion as of Sept. 30, 2015.
The Debtors engaged Weil, Gotshal & Manges LLP as general counsel,
Richards, Layton & Finger, P.A. as local counsel, Lazard Freres &
Co. LLC as financial advisor, Alixpartners, LLP as restructuring
advisor, and Kurtzman Carson Consultants as claims and noticing
agent.
PARAGON POOLS: U.S. Trustee Unable to Appoint Committee
-------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Paragon Pools Corporation as of
Jan. 19, according to a court docket.
About Paragon Pools
Based in Las Vegas, Nevada, Paragon Pools Corporation, filed a
Chapter 11 bankruptcy petition (Bankr. D. Nev. Case No. 16-16342)
on Nov. 28, 2016. The Hon. August B. Landis, presides over the
case. In its petition, the Debtor declared $23,554 in total assets
and $1.57 million in total liabilities. Ryan Andersen of Andersen
Law serves as bankruptcy counsel.
The petition was signed by Joseph M. Vassallo, president.
A copy of the Debtor's list of 19 largest unsecured creditors is
available for free at http://bankrupt.com/misc/nvb16-16342.pdf
PARC ENGLAND: Proposes Auction of Closed Hotel and Restaurant
-------------------------------------------------------------
Parc England Holding, L.L.C., asks the U.S. Bankruptcy Court for
the Western District of Louisiana to authorize the sale of its
interest in the hotel and restaurant located at 1321 Chappie James
Avenue, Alexandria, Louisiana, by public auction.
At the time the case was filed, the Debtor operated a hotel known
as the "Parc England Hotel" and a restaurant known as "Bistro on
the Bayou Restaurant". The Hotel and Restaurant was operated on
immovable property owned by the England Economic and Industrial
District ("England Authority") under the terms of a lease with it.
The leased immovable property has a municipal address of 1321
Chappie James Avenue, Alexandria, Louisiana. The Hotel and
Restaurant and other improvements were constructed by the debtor on
the leased property. The Debtor granted a consensual first
mortgage or lien on these improvements to the Bank of Montgomery.
Pursuant to a consent order entered Sept. 7, 2016, the day-to-day
management of the debtor was exclusively vested in ALLA Associates,
LLC, a management company retained by the principal creditor, the
Bank of Montgomery. The management company immediately closed the
hotel and restaurant and the same have remained closed since that
time.
The Debtor's representative was contacted by a representative of
RSK Investments, L.L.C., expressing an interest in the Hotel and
Restaurant. It offered to purchase the Hotel and Restaurant which
offer was in the form of a Letter of Intent dated Oct. 14, 2016.
The offer was to purchase the Hotel and Restaurant for the sum of
$1,750,000, subject to certain conditions. The parties could never
arrive at an agreement and the offer expired.
The Debtor's representative was contacted by Joseph Villard, of 297
Mudge Road, Boyce, Louisiana, a representative of Harvill, L.L.C.,
expressing an interest in the Hotel and Restaurant. He (and/or It)
offered to purchase the Hotel and Restaurant for the sum of
$6,500,000. Initially the offer was made subject to acceptance of
capital loss reserves of $16,500,000, but was recently changed to
"US dollars at the time of transfer of title."
The Debtor's representative was contacted by a representative of an
as of yet unnamed entity (to be formed by the person formerly
involved with RSK Investments) expressing an interest in the Hotel
and Restaurant. An offer to purchase the Hotel and Restaurant was
made for the sum of $1,000,000.
While the Debtor was been actively engaged in trying to determine
the validity and details of the 2 offers, the Bank of Montgomery
filed a Motion to Dismiss, Or In The Alternative, To Convert The
Case To Chapter 7, Or Further In The Alternative, For Relief From
the Automatic Stay ("the Bank's Motion"). The motion is fixed for
hearing Feb. 1, 2016, in the Court.
After considering the various options, the Debtor believes the
property should be sold at public auction. As the Debtor believes
there is not time to comply with the normal and customary
procedures due to the hearing scheduled on the Bank's Motion, it
seeks an order waiving the same and allowing for an auction at the
first hearing on the Motion. In order for the auction to be held
at the first hearing, an order is required that the highest or
successful bidder pay the price with certified funds or cash
equivalent at the time of the auction or shortly thereafter as set
forth. As a result of the expedited nature of the process there is
no request for a deposit, nor break-up fee.
In addition, the assets of the estate consists of certain
intangible assets in the form of trade names, specifically "Parc
England Hotel" and "Bistro on the Bayou Restaurant."
The mortgage records of Rapides Parish, Louisiana, reflect these
liens affecting the property, but the validity or amount of such
liens has not been verified, to-wit:
a. First: Multiple Indebtedness Mortgage to Bank of Montgomery
and Any Future Holder in the original principal amount of
$4,000,000, dated, filed and recorded Dec. 20, 2012, under Entry
No. 1492825, Mortgage Book 2708, Page 348, of the records of
Rapides Parish, Louisiana.
b. Second: Tax Lien & Privilege to Rapides Sales & Tax Use
Department in the original amount of $15,664, dated Nov. 18, 2014,
filed and recorded Nov. 19, 2014, under Entry No. 1540605, Mortgage
Book 2836, Page 900, of the records of Rapides Parish, Louisiana.
c. Third: Tax Lien to the USA – Dept. of Treasury – Internal
Revenue Service dated Jan. 7, 2015, filed and recorded Jan. 21,
2015, in the amount of $181,412, under Entry No. 1543995, Mortgage
Book 2846, Page 990, of the records of Rapides Parish, Louisiana,
as amended at Mortgage Book 2882, Page 654.
d. Fourth: Tax Lien to the USA – Dept. of Treasury –
Internal Revenue Service dated April 1, 2015, filed and recorded
April 13, 2015, in the amount of $29,576, under Entry No. 1549299,
Mortgage Book 2862, Page 691, of the records of Rapides Parish,
Louisiana, as amended at Mortgage Book 2882, Page 655.
e. Fifth: Tax Lien to Louisiana Workforce Commission, Office of
Unemployment Insurance, in the amount of $5,697, dated Aug. 1,
2015, and filed and recorded Aug. 3, 2015, at Mortgage Book 2884,
Page 979, under Instrument No. 1557471, of the records of Rapides
Parish, Louisiana.
f. Sixth: Judgment in favor of Rapides Parish Police Jury dated
Feb. 22, 2016, in the amount of $11,159, and $14,436, and $896, and
$100, filed and recorded Feb. 25, 2016, at Mortgage Book 2923, Page
675, under Instrument No. 1570382, of the records of Rapides
Parish, Louisiana.
g. Seventh: Tax Lien to State of Louisiana Department of Revenue
in the amount of $224,813, dated March 4, 2016, and filed and
recorded March 22, 2016, at Mortgage Book 2928, Page 859, under
Instrument No. 1571997, of the records of Rapides Parish,
Louisiana.
h. Eighth: Tax Lien to Louisiana Workforce Commission, Office of
Unemployment Insurance, in the amount of $5,697, dated June 29,
2016, and filed and recorded June 30, 2016, at Mortgage Book 2949,
Page 292, under Instrument No. 1579834, of the records of Rapides
Parish, Louisiana.
i. Ninth: Tax Lien to Louisiana Department of Labor Office of
Regulatory Services, in the amount of $1,467, dated Nov. 16, 2007,
and filed and recorded Dec. 7, 2007, at Mortgage Book 2351, Page
663, under Instrument No. 1357542, of the records of Rapides
Parish, Louisiana.
j. Tenth: Tax Lien to State of Louisiana Department of Revenue
in the amount of $19,818, dated Feb. 25, 2016, and filed and
recorded March 17, 2016, at Mortgage Book 2928, Page 23, under
Instrument No. 1571708, of the records of Rapides Parish,
Louisiana.
In addition to these liens there is in full force and effect a
lease between the debtor and the England Authority. The lease was
originally effective July 1, 2001, involving another entity but
later amended and assigned to the Debtor. An Abstract of the lease
dated July 1, 2001, was filed and recorded Aug. 29, 2001, at
Mortgage Book 1719, Page 859, under Instrument No. 1165527, of the
records of Rapides Parish, Louisiana.
As a result, the prospective purchaser must comply with all terms
and conditions set forth in the said lease and/or negotiate
directly with the England Authority for any changes to the lease.
The Debtor is aware that the offer from the as of yet unnamed
entity of $1,000,000 is conditioned upon the England Authority
granting to it a 50-year lease. The said unnamed entity which is
owned by the same principal that owns RSK Investments has made an
offer to purchase the assets for the price of $1,000,000. The
identity of the actual entity making the purchase has not yet been
established.
As further described, an offer was made by a Villard, of 297 Mudge
Road, Boyce, Louisiana, who indicated he was a representative of
Harvill. He made an offer to purchase the Hotel and Restaurant for
the sum of $6,500,000, subject to acceptance of capital loss
reserves of $16,500,000. When he was informed the offer would have
to be for U.S. currency, he changed the offer to be for "US dollars
at the time of transfer of title."
To the best of the knowledge of the debtor, no former officer,
director, agent, shareholder or other representative who could be
deemed an "insider" of the Debtor under 11 U.S.C. 101 (31) has a
pecuniary interest in either prospective bidder. In addition, the
Debtor has no knowledge that such former officer, director,
shareholder or other representative of the Debtor has been promised
anything by any prospective bidder, in connection with the sale of
the assets of the Debtor.
The principal making the offer for the as of yet unnamed entity is
aware that the Property is being sold "as is," and he is familiar
with the current condition of the property. It is not known if
Joseph Villard has any information concerning the condition of the
premises.
As stated, the Hotel and Restaurant have been closed since the
management company was appointed (late August 2016) and have
remained closed since that time. In addition, the Bank of
Montgomery reports that it discovered black mold on the premises
and that condition has been remediated. Further, the Bank of
Montgomery has indicated that the air conditioning and heating has
been required to be repaired. Accordingly, the offer is made "as
is" except as to the black mold and the climate control equipment.
This limited warranty as to those items is not to be understood as
being provided by the Debtor as the Debtor has no knowledge as to
the current status of the premises. This representation is simply
that the repairs have been made to remediate the mold and repair
the climate control equipment and is provided by the Bank of
Montgomery. The "as is" nature of the sale applies to any offer
determined to be the last and highest valid offer.
Since there is no time to investigate or determine the validity of
the offers made, the Debtor requests an Order requiring these:
a. The auction will be conducted by counsel for the debtor, as
auctioneer.
b. The auction will take place immediately following the hearing
on the Motion at the Court, in a location in the Court to be
selected by the auctioneer.
c. The minimum or starting bid is $1,000,000.
d. all bids in excess of that amount will be at least $5,000
more than the previous bid; and the auctioneer will have authority
to increase that amount to $25,000, if necessary in the interest of
time.
e. The last and highest bidder, as determined by the auctioneer
will be required to deposit the amount of that bid in the trust
account of counsel for the Debtor within 72 hours after the
completion of the auction. Should that not occur, the auctioneer
will be entitled to apply for an ex parte order setting aside the
last and highest bid and finding the next highest bid to be the
successful bid.
f. The auctioneer will file a report of the auction with the
Court within 24 hours after the conclusion of the auction.
g. All parties in interest are entitled to attend, observe, and
participate in the auction.
h. The Bank of Montgomery, as the first and fully secured
lienholder, is entitled to credit bid in accordance with RadLAX
Gateway Hotel, LLC v. Amalgamated Bank, 132 S. Ct. 2065 (2012).
The Debtor is informed that the prospective purchasers have
conditioned their bids upon being able to close the sale within a
short period of time. Therefore, the Debtor will apply to the
Court to shorten the notice period to allow for the auction to be
conducted as soon as possible.
The Debtor's decision to sell the assets is based on its sound
business judgment. The Debtor seeks to liquidate its estate so
that it may justly and equitable compensate its creditors. The
assets are a significant part of the Debtor's estate, and its sale
will help expedite payment to the holders of allowed claims.
Accordingly, the Debtor asks the Court to approve the sale of the
assets free of liens with the liens and encumbrances to attach to
the proceeds of the sale.
To satisfy the Liens and Claims described, the Debtor asks approval
on distributing the proceeds of the sale as follows:
a. First, payment of all necessary costs of the sale paid by
sellers at closing, including cancellation charges, recordation
charges, real estate taxes and other closing costs attributable to
the estate.
b. Second, to The Bank of Montgomery in the amount if its
outstanding allowed claim.
c. Third, the remainder, if any, to be held in escrow pending
further order of the Court.
In order to facilitate a smooth and swift closing, the Debtor
further requests that from the proceeds at the closing of the sale
of the Property the closing notary, as an agent of the Debtor be
authorized to make payment of any and all necessary costs of the
sale paid by sellers at closing, including cancellation charges,
recordation charges, real estate taxes and other costs attributable
to the estate.
The Debtor further asks that any outstanding real estate taxes owed
and outstanding on the Property as of the closing date be paid by
the closing notary at closing from the sale proceeds, with
Purchaser to be responsible for real estate taxes accruing on or
after the closing date.
Lastly, the Debtor asks that it be authorized to redeem the
property from any tax sales.
As time is of the essence to the proposed sale, the Debtor asks the
Court waive 14-day automatic stay of any final order granting the
Motion and order that the final relief requested be immediately
available upon the entry of an Order approving the proposed sale.
About Parc England Holding
Parc England Holding, LLC, operated a hotel named Parc England
Hotel and a restaurant named Bistro on the Bayou in Alexandria,
Louisiana.
Parc England Holding filed for Chapter 11 bankruptcy protection
(Bankr. W.D. La. Case No. 16-80255) on March 8, 2016, disclosing $0
assets and total liabilities of $5.87 million. The petition was
signed by Fred Rosenfeld, managing member.
Judge John W. Kolwe presides over the case.
Thomas R. Willson, Esq., at Thomas R. Willson serves as the
Debtor's bankruptcy counsel.
PEABODY ENERGY: Committee Agrees to Support Plan, Rights Offering
-----------------------------------------------------------------
Peabody Energy Corporation informed the Bankruptcy Court for the
Eastern District of Missouri that the Debtors have reached a
settlement with the official committee of unsecured creditors with
respect to the Debtors':
(a) the Joint Plan of Reorganization, and
(b) Motion for an Order (I) Approving (A) Private Placement
Agreement and (B) Backstop Commitment Agreement; (II) Authorizing
Debtors to Enter into (A) Plan Support Agreement, (B) Private
Placement Agreement and (C) Backstop Commitment Agreement; (III)
Approving (A) Rights Offering, (B) Related Procedures and (C)
Payment of Related Expenses and (IV) Granting Related Relief.
"To resolve the issues and concerns raised by the official
committee of unsecured creditors appointed in the Debtors'
bankruptcy cases with respect to the Plan, the Disclosure
Statement, the Solicitation Motion and the Approval Motion, the
Debtors have reached a settlement agreement with the Creditors'
Committee . . . which settlement is supported by the Requisite
Members of the Noteholder Steering Committee," the Debtors said.
1. The Committee will become a co-proponent of the Plan and
get approval rights on matters that materially and
adversely affect the amount of equity and cash
distributions to holders of General Unsecured Claims that
are not Unsecured Senior Notes Claims.
2. General Unsecured Claims at the Encumbered Guarantor
Debtors (Class 5B):
* In lieu of receiving any distributions of
(i) Reorganized PEC Common Stock, (ii) Rights
Offering Equity Rights or (iii) if applicable, Rights
Offering Disputed Claims Reserve Shares for holders of
Claims in Class 5B that are Disputed as of the Rights
Offering Record Date and later become Allowed, holders
of Claims in Class 5B can elect to receive on account
of their Allowed Claims a pro rata cash distribution
from a pool of $60 million, with recoveries to be
capped at 30% of their Allowed Claims. The treatment
of Class 5B Claims in the Plan shall otherwise
remain the same.
* Cash available for payment to holders of Allowed Class
5B Claims who make the Class 5B Cash Election will be
limited to the Class 5B Cash Pool, which will be paid
into a segregated account for distribution in
accordance with the terms of the Plan to holders of
Allowed Class 5B Claims in two installments:
(a) $30 million on the date that is 100 days after the
Effective Date; and
(b) $30 million on the date that is 190 days after the
Effective Date.
The obligation to fund shall be deemed an
administrative
obligation of the Debtors' estates and be reflected as
such in any order confirming the proposed Plan.
* To the extent that less than $60 million is required
to fund a 30% distribution to holders of Allowed Class
5B Claims who make the Class 5B Cash Election, the
excess shall be retained by the Reorganized Debtors.
3. General Unsecured Claims at PEC (Class 5A):
* The amount of cash available for distribution to
Holders
of Allowed General Unsecured Claims against PEC (Class
5A) that are not Convenience Claims in Class 6A shall
be increased from $3 million to $5 million.
4. Treatment for holders of Convenience Claims at PEC (Class
6A) and the Encumbered Guarantor Debtors (Class 6B) shall
remain as proposed in the Plan.
5. Plan modified to include "Creditors' Committee and its
members (solely in their capacities as such)" in the
definition of "Released Parties".
6. In exchange for the modifications being incorporated into the
Plan, the Committee shall agree to:
* provide a letter in support of confirmation of the
Plan and encouraging all holders of General Unsecured
Claims to vote in favor of the Plan, which letter
shall be included with the solicitation materials
for the Plan;
* file pleadings in support of the Plan, including
supporting declarations, that may be necessary or
appropriate;
* not directly or indirectly object to, delay, impede
or take any other action to materially interfere
with acceptance, confirmation, consummation or
implementation of the Plan;
* not directly or indirectly seek, solicit, encourage,
formulate, consent to, propose, file, support,
negotiate or participate in any restructuring,
workout, plan of reorganization or liquidation,
proposal, offer, dissolution, winding up, liquidation,
reorganization, merger, consolidation, business
combination, joint venture, partnership, or sale of
assets of or in respect of the Debtors or their
non-debtor affiliates other than the Plan or
encourage or cause any party to do any of the
foregoing; and
* take any and all necessary or appropriate actions in
furtherance of the restructuring and the transactions
contemplated under the Plan and the Plan Documents.
7. Notwithstanding section 6 hereof, nothing shall be deemed to
limit any of the rights of the Committee, to the extent
consistent with this Agreement, to appear and participate
as a party in interest in any matter to be adjudicated in
the Chapter 11 Cases so long as such appearance or
participation and the positions advocated in connection
therewith are not inconsistent with this Agreement, and
do not hinder, delay or prevent consummation of the Plan.
8. On or before January 24, 2017 at 4:00 p.m. (ET), the
Committee shall have the right to terminate this
agreement to support a fully committed equity financing,
confirmable, and superior alternative transaction other
than the Plan solely to the extent termination is
believed necessary to comply with the Committee's
fiduciary obligations under applicable law.
9. From and after the date this term sheet is filed with
the Bankruptcy Court, the Committee will not, and
will not permit any of their respective representatives,
to initiate contact with, or solicit any inquiries,
proposals or offers from any party (other than the
Debtors and the Creditor Co-Proponents) with respect
to any alternative transactions; provided, however, that
the Committee and its representatives may review and
consider any inquiries, proposals or offers with respect
to an alternative transaction so long as such proposal
was not obtained, pursued, facilitated or solicited by
them in violation of the provisions set forth.
10. To the extent the Committee or any of its agents or
representatives receive any inquiry, proposal or offer
with respect to any alternative transaction, the Committee
shall provide the Debtors and the Creditor Co-Proponents
(subject to mutually agreed terms of confidentiality) and
their counsel with a copy of and/or any details regarding
such proposal upon receipt and no later than one day
after receipt.
11. If the Committee exercises the Fiduciary Out, it will
not seek a continuance or delay of the January 26, 2017
hearing to approve the Disclosure Statement, the
Private Placement Agreement, the Backstop Commitment
Agreement and the Plan Support Agreement.
12. The Committee will provide counsel for the Plan
Co-Proponents a copy of its draft objection to the
Transaction Agreements by noon on January 18, 2017.
This agreement shall not be construed as tolling or
extending any of the Committee's objection deadlines.
13. From and after the date this term sheet is filed with
the Bankruptcy Court, all depositions related to the
approval of the Disclosure Statement or the Transaction
Agreements shall be discontinued and cancelled, and the
Committee shall not seek further discovery from the
Debtors or Creditor Co-Proponents; provided, however,
that the Committee and its representatives shall be
permitted to seek discovery with respect to the
Transaction Agreements following termination of this
agreement pursuant to the Fiduciary Out.
14. If the Committee does not exercise the Fiduciary Out,
an amended Plan and Disclosure Statement reflecting the
agreed changes set forth herein will be filed after
January 24, 2017 at 4:00 p.m. (ET) and in no event
later than the start of the hearing to approve the
Disclosure Statement on January 26, 2017. If the
Committee exercises the Fiduciary Out, the Debtors
and the Noteholder Co-Proponents shall have no
obligation to file such an amended Plan and Disclosure
Statement. If the Committee exercises the Fiduciary Out,
the consent of the Debtors and the Noteholder
Co-Proponents to the changes to the Plan set forth
shall be null and void and of no effect, and the
Debtors and the Noteholder Co-Proponents reserve their
rights to make any further changes to the Plan they
deem necessary or appropriate in response to the
Committee's opposition to its approval.
15. The Plan shall establish a post-Effective Date claims
reconciliation process for the reconciliation of
claims that would be satisfied from the Class 5B Cash
Pool. A designee from the Committee would be appointed
as the co-administrator for the reconciliation process
under the Plan (the "Designated Co-Administrator"). The
fees and costs of the Designated Co-Administrator
associated with the reconciliation process shall be
paid by the Reorganized Debtors up to the amount of
$3 million. Prior to the Effective Date, the allowance
of any GUC claim that will impact distributions from
the Class 5B Cash Pool, including if the aggregate
amount of claims to be settled is for the benefit of
a single claimant, that exceeds $2 million shall
require Committee consent.
The Debtors intend to file amended versions of the Plan and the
Disclosure Statement to reflect the terms of the Committee
Settlement before the commencement of the hearing to approve the
Disclosure Statement.
The Debtors on January 16, 2017, also filed with the Bankruptcy
Court a liquidation analysis and certain projected financial
information as exhibits to the Disclosure Statement. The projected
financial information filed with the Bankruptcy Court is consistent
with the illustrative sources and uses for the Plan.
About Peabody Energy Corporation
Headquartered in St. Louis, Missouri, Peabody Energy Corporation
claims to be the world's largest private-sector coal company. As
of Dec. 31, 2014, the Company owned interests in 26 active coal
mining operations located in the United States (U.S.) and
Australia. The Company has a majority interest in 25 of those
mining operations and a 50% equity interest in the Middlemount
Mine
in Australia. In addition to its mining operations, the Company
markets and brokers coal from other coal producers, both as
principal and agent, and trade coal and freight-related contracts
through trading and business offices in Australia, China, Germany,
India, Indonesia, Singapore, the United Kingdom and the U.S.
Peabody posted a net loss of $1.988 billion for 2015, wider from
the net loss of $777 million in 2014 and the $513 million net loss
in 2013.
At Dec. 31, 2015, the Company had total assets of $11.02 billion
against $10.1 billion in total liabilities, and stockholders'
equity of $919 million.
On April 13, 2016, Peabody Energy Corp. and 153 affiliates filed
voluntary petitions for relief under Chapter 11 of the United
States Bankruptcy Code. The 154 cases are pending joint
administration before the Honorable Judge Barry S. Schermer under
(Bankr. E.D. Mo. Case No. 16-42529).
As of the Petition Date, PEC has approximately $4.3 billion in
outstanding secured debt obligations and $4.5 billion in
outstanding unsecured debt obligations.
The Debtors tapped Jones Day as general counsel; Armstrong,
Teasdale LLP as local counsel; Lazard Freres & Co. LLC and
investment banker Lazard PTY Limited as investment banker; FTI
Consulting, Inc., as financial advisors; and Kurtzman Carson
Consultants, LLC, as claims, ballot and noticing agent.
The Office of the U.S. Trustee on April 29, 2016, appointed seven
creditors of Peabody Energy Corp. to serve on the official
committee of unsecured creditors. The Committee retained Morrison
& Foerster LLP as counsel, Spencer Fane LLP as local counsel,
Curtis, Mallet-Prevost, Colt & Mosle LLP as conflicts counsel,
Blackacre LLC as its independent expert, and Berkeley Research
Group, LLC, as financial advisor.
PEABODY ENERGY: Debtors, UCC Balk at Bid for Equity Panel
---------------------------------------------------------
Peabody Energy Corporation and the Official Committee of Unsecured
Creditors appointed in the Debtors' chapter 11 bankruptcy cases
tell the Bankruptcy Court that an official equity security holders
committee is not necessary in the case. They ask the Court to
reject the request of The Mangrove Partners Master Fund, Ltd. for
appointment of an equity committee.
According to the Debtors, Mangrove has not shown that there is a
substantial likelihood of meaningful recoveries for equity security
holders of PEC common stock, and that its assertion to the contrary
is based upon an analysis containing errors and mistaken
assumptions. When these errors and mistaken assumptions are
corrected, Mangrove's analysis shows that Equity Holders have no
meaningful opportunity for recovery.
"This reality is borne out by the Debtors' proposed Joint Plan of
Reorganization," the Debtors explain, "which has received support
from, as of January 6, 2017, holders of approximately 40.7% of the
Debtors' outstanding First Lien Lender Claims (as defined in the
Plan), 94.9% of the outstanding principal amount of the Debtors'
Second Lien Notes Claims (as defined in the Plan) and 80.3% of
outstanding principal amount of the Debtors' Unsecured Senior Notes
Claims (as defined in the Plan). Many of the Debtors' creditors
would receive only a fractional recovery on their claims, including
general unsecured creditors and Unsecured Senior Noteholders (as
defined in the Plan) who would receive an estimated 21% recovery,
if the Plan is confirmed. Under the absolute priority rule, Equity
Holders cannot receive any recovery until all the Debtors'
creditors are made whole. Because Equity Holders cannot recover
anything unless the Debtors' creditors are paid in full, the
appointment of an official committee of Equity Holders will serve
only to deplete estate assets through the payment of another set of
professionals."
The Debtors also contend that the interests of Equity Holders are
adequately represented in these chapter 11 cases. The Creditors'
Committee, the Debtors' board of directors and management and
Mangrove's own sophisticated professionals all are capable and
committed to protecting Mangrove's interest in these chapter 11
cases.
The Debtors also believe the Motion is untimely. Nearly nine
months have passed since the Debtors filed these chapter 11 cases.
In the last four months, the Debtors have spent significant time
negotiating the terms and provisions of the Plan with many of their
key creditor constituencies. As a result of these efforts, the
Debtors' Plan, filed on December 22, 2016, is supported by
significant groups of the Debtors' First Lien Lenders, Second Lien
Noteholders and Unsecured Senior Noteholders.
The Committee also contends that Mangrove has failed to carry its
heavy burden of demonstrating that there is a substantial
likelihood that the Debtors' equity holders will receive a
meaningful distribution under a strict application of the absolute
priority rule and that the interests of equity holders cannot be
adequately represented without an official committee.
The Creditors' Committee asserts that appointment of an official
equity committee is considered "extraordinary relief" and is the
"rare exception." According to the Creditors' Committee, while a
full valuation analysis is not needed to prevail on a motion
seeking appointment of an equity committee, Mangrove has offered no
affirmative evidence in support of a valuation scenario under which
equity would be entitled to a distribution and has made no attempt
to show that equity is in the money. Rather, Mangrove merely
observes that there was a recent upturn in spot coal prices and
speculates that "equity is poised to recover meaningful value as
long as metallurgical and thermal coal prices stabilize around
$145/ton and $77/ton or higher . . . ."
About Peabody Energy Corporation
Headquartered in St. Louis, Missouri, Peabody Energy Corporation
claims to be the world's largest private-sector coal company. As
of Dec. 31, 2014, the Company owned interests in 26 active coal
mining operations located in the United States (U.S.) and
Australia. The Company has a majority interest in 25 of those
mining operations and a 50% equity interest in the Middlemount
Mine
in Australia. In addition to its mining operations, the Company
markets and brokers coal from other coal producers, both as
principal and agent, and trade coal and freight-related contracts
through trading and business offices in Australia, China, Germany,
India, Indonesia, Singapore, the United Kingdom and the U.S.
Peabody posted a net loss of $1.988 billion for 2015, wider from
the net loss of $777 million in 2014 and the $513 million net loss
in 2013.
At Dec. 31, 2015, the Company had total assets of $11.02 billion
against $10.1 billion in total liabilities, and stockholders'
equity of $919 million.
On April 13, 2016, Peabody Energy Corp. and 153 affiliates filed
voluntary petitions for relief under Chapter 11 of the United
States Bankruptcy Code. The 154 cases are pending joint
administration before the Honorable Judge Barry S. Schermer under
(Bankr. E.D. Mo. Case No. 16-42529).
As of the Petition Date, PEC has approximately $4.3 billion in
outstanding secured debt obligations and $4.5 billion in
outstanding unsecured debt obligations.
The Debtors tapped Jones Day as general counsel; Armstrong,
Teasdale LLP as local counsel; Lazard Freres & Co. LLC and
investment banker Lazard PTY Limited as investment banker; FTI
Consulting, Inc., as financial advisors; and Kurtzman Carson
Consultants, LLC, as claims, ballot and noticing agent.
The Office of the U.S. Trustee on April 29, 2016, appointed seven
creditors of Peabody Energy Corp. to serve on the official
committee of unsecured creditors. The Committee retained Morrison
& Foerster LLP as counsel, Spencer Fane LLP as local counsel,
Curtis, Mallet-Prevost, Colt & Mosle LLP as conflicts counsel,
Blackacre LLC as its independent expert, and Berkeley Research
Group, LLC, as financial advisor.
PEABODY ENERGY: Liberty Mutual Balks at Bid to Approve Exit Loans
-----------------------------------------------------------------
Liberty Mutual Insurance Company objects to the request of Peabody
Energy Corporation to enter into an exit financing commitment
letter to the extent that the Motion seeks to include irrevocable
letters of credit in the collateral securing the Exit Facility.
Liberty is the surety on numerous miscellaneous commercial bonds
that named the Debtors or their affiliates as principal, primarily
in connection with reclamation activities.
Liberty contends that the ILOC is not property of the Debtors'
estates. Liberty wants the Court to rule that any liens granted to
the Debtors' Lenders are junior to and do not otherwise prejudice
the rights and interests of Liberty in and to the ILOC.
Peabody Energy on January 11, 2017, obtained an exit facility
commitment letter from:
-- Goldman Sachs Bank USA, as administrative agent and
lender;
-- JPMorgan Chase Bank, N.A., as arranger and lender;
-- Credit Suisse AG, acting through such of its affiliates or
branches as it deems appropriate, as lender;
-- Credit Suisse Securities (USA),
-- Macquarie Capital Funding LLC, and
-- Macquarie Capital (USA) Inc.,
pursuant to which, in connection with the consummation of the
proposed Plan, the Initial Lenders -- Macquarie Capital Funding,
Goldman Sachs, Credit Suisse AG and JPMorgan -- have agreed to
provide a senior secured term loan facility in an aggregate amount
of (a) $1.5 billion, less (b) the aggregate principal amount of
privately placed debt securities of the Company, or special purpose
escrow issuer, issued on or prior to the closing date of the Term
Loan Facility, plus (c) any amount of additional senior secured
term loans funded on the Closing Date at the sole discretion of the
Arrangers -- CS Securities, Goldman Sachs and JPMorgan -- and the
Company.
The commitments of the Commitment Parties to provide the Term Loan
Facility are subject to certain conditions set forth in the Exit
Facility Commitment Letter, including but not limited to the
occurrence or waiver of all conditions precedent to the
effectiveness of the Plan, other than the closing and funding of
the Term Loan Facility (and the Notes issued in lieu thereof, if
any).
The Exit Facility Commitment Letter will terminate upon the
occurrence of certain events described therein. In addition, the
Initial Lenders' commitments to provide and arrange the Term Loan
Facility will terminate on a dollar-for-dollar basis to the extent
of the issuance of the Notes. The outside termination date for the
Exit Facility Commitment Letter is May 1, 2017.
Specifically, the Commitment Letter provides that each Initial
Lender's commitment and each Commitment Party's agreements
hereunder will terminate upon the earliest of: (a) at any time by
the Company with or without cause effective upon receipt by the
Commitment Parties of notice to that effect from the Company, (b)
January 30, 2017, unless as of such date the Authorization Order
has been entered and is otherwise in full force and effect, (c) at
any time that the Plan Support Agreement shall have terminated or
been modified in a manner that is materially adverse to the
Arrangers or the Lenders without consent of the Arrangers, (d) May
1, 2017, unless as of such date (A) the Bankruptcy Court has
entered a final and non-appealable order confirming the Plan, which
confirmation order shall be, to the extent material to the
Commitment Parties, in form and substance reasonably acceptable to
each of the Commitment Parties, and (B) the Debtors have emerged
from the Bankruptcy Cases, (e) upon the termination, abandonment or
withdrawal of, the Plan by the Debtors, and (f) upon the emergence
of the Debtors from the Bankruptcy Cases, unless, in the case of
clause (f), the closing of the Term Loan Facility, on the terms and
subject to the conditions contained herein, has been consummated on
or before such date.
On January 11, 2017, the Debtors filed a motion with the Bankruptcy
Court seeking authorization to enter into and perform under the
Exit Facility Commitment Letter.
A copy of the Commitment Letter is available at
https://is.gd/IVXJnx
The Term Loan Facility Commitments are:
Bank Commitment Party Term Loan Facility
Goldman Sachs Bank USA 50.0% $750,000,000
JPMorgan Chase Bank, N.A 22.5% $337,500,000
Credit Suisse AG 22.5% $337,500,000
Macquarie Capital Funding LLC 5.0% $75,000,000
----- ---- --------------
Total 100% $1,500,000,000
The Commitment Parties and Administrative Agent are represented by
Latham & Watkins LLP.
The lending syndicate may be reached at:
Robert Ehudin
GOLDMAN SACHS BANK USA
200 West Street
New York, NY 10282-2198
- and -
Peter S. Predun, Executive Director
JPMORGAN CHASE BANK, N.A.
383 Madison Avenue
New York, NY 10179
- and -
Douglas Pierson, Managing Director
CREDIT SUISSE SECURITIES (USA) LLC
Eleven Madison Avenue
New York, NY 10010
- and -
Robert Hetu
Warren Van Heyst
CREDIT SUISSE AG, CAYMAN ISLANDS BRANCH
Eleven Madison Avenue
New York, NY 10010
- and -
Andrew Marbach, VP
Lisa Grushkin, Managing Director
MACQUARIE CAPITAL (USA) INC.
MACQUARIE CAPITAL FUNDING LLC
125 West 55th Street
New York, NY 10019
Attorneys for Liberty Mutual Insurance Company:
Keith A. Langley, Esq.
Brandon K. Bains, Esq.
LANGLEY LLP
1301 Solana Blvd.
Building 1, Suite 1545
Westlake, TX 76262
Telephone: 214.722.7171
Facsimile: 214.722.7161
E-mail: klangley@l-llp.com
bbains@l-llp.com
About Peabody Energy Corporation
Headquartered in St. Louis, Missouri, Peabody Energy Corporation
claims to be the world's largest private-sector coal company. As
of Dec. 31, 2014, the Company owned interests in 26 active coal
mining operations located in the United States (U.S.) and
Australia. The Company has a majority interest in 25 of those
mining operations and a 50% equity interest in the Middlemount
Mine
in Australia. In addition to its mining operations, the Company
markets and brokers coal from other coal producers, both as
principal and agent, and trade coal and freight-related contracts
through trading and business offices in Australia, China, Germany,
India, Indonesia, Singapore, the United Kingdom and the U.S.
Peabody posted a net loss of $1.988 billion for 2015, wider from
the net loss of $777 million in 2014 and the $513 million net loss
in 2013.
At Dec. 31, 2015, the Company had total assets of $11.02 billion
against $10.1 billion in total liabilities, and stockholders'
equity of $919 million.
On April 13, 2016, Peabody Energy Corp. and 153 affiliates filed
voluntary petitions for relief under Chapter 11 of the United
States Bankruptcy Code. The 154 cases are pending joint
administration before the Honorable Judge Barry S. Schermer under
(Bankr. E.D. Mo. Case No. 16-42529).
As of the Petition Date, PEC has approximately $4.3 billion in
outstanding secured debt obligations and $4.5 billion in
outstanding unsecured debt obligations.
The Debtors tapped Jones Day as general counsel; Armstrong,
Teasdale LLP as local counsel; Lazard Freres & Co. LLC and
investment banker Lazard PTY Limited as investment banker; FTI
Consulting, Inc., as financial advisors; and Kurtzman Carson
Consultants, LLC, as claims, ballot and noticing agent.
The Office of the U.S. Trustee on April 29, 2016, appointed seven
creditors of Peabody Energy Corp. to serve on the official
committee of unsecured creditors. The Committee retained Morrison
& Foerster LLP as counsel, Spencer Fane LLP as local counsel,
Curtis, Mallet-Prevost, Colt & Mosle LLP as conflicts counsel,
Blackacre LLC as its independent expert, and Berkeley Research
Group, LLC, as financial advisor.
PEABODY ENERGY: Mangrove's Equity Panel Bid Gains Support
---------------------------------------------------------
An Ad Hoc Committee of Non-Consenting Creditors -- whose members
are the beneficial holders of, or are investment managers or
advisors to funds and/or accounts that are the beneficial holders
of, among other things, Second Lien Notes, Unsecured Notes, and
Convertible Subordinated Debentures -- expressed its support to the
request of The Mangrove Partners Master Fund, Ltd. for an order
appointing an Official Committee of Equity Security Holders in
Peabody Energy's bankruptcy case.
The Debtors are "not hopelessly insolvent," according to the
Group.
The group tells the Court that in objecting to the Motion, the
Debtors will no doubt make reference to the plan of reorganization
that they and a select group of their creditors have recently
co-proposed and the need to confirm it expeditiously.
The Ad Hoc Committee has already made clear to the Court its
initial views on the Proposed Plan, including that the Proposed
Plan inappropriately disenfranchises certain stakeholders, notably
holders of prepetition convertible notes and equity interests.
"It bears repeating, however, that the Proposed Plan does not use
an objectively determined enterprise value in determining the
relative entitlements of the Debtors’ stakeholders. Instead, the
Proposed Plan is premised upon a Plan Enterprise Value "agreed" to
by parties with an incentive to ascribe an unjustifiably low value
to the Debtors that bears no relationship to either the Debtors'
performance or objective market conditions. This use of an
unfounded enterprise value is an inappropriate basis for
determining the entitlements of stakeholders," the group says.
The group reminds the Court that the Debtors have outperformed
their own expectations in these cases. No longer strapped for cash
in the present price and demand environment, the Debtors:
-- Exceeded their own cash generation forecasts in the
original DIP budget every single month while in bankruptcy;
-- Voluntarily repaid their DIP obligations in December, four
months ahead of schedule; and
-- Are expected, according to the business update attached
their most recent 8-K, to have (together with their non-Debtor
subsidiaries) approximately $1.35 billion in cash at emergence.
The Debtors' liquidity position -- a crucial component of the
decision to file for bankruptcy -- has improved considerably, and
all signs indicate that stabilizing prices and growing demand is
the norm, not an aberration. Taken together, these objective
factors demonstrate that the Debtors are not hopelessly insolvent.
Despite favorable market conditions, the Debtors continue to use
depressed assumptions in their business plan, according to the
group.
Meanwhile, JAZ Ventures, LP, a holder of common stock issued by
Peabody Energy, gave its support to Mangrove Partners' request.
Mangrove indicated that Mr. Judson Kroh has expressed an interest
and willingness to serve on the Equity Committee. Mr. Kroh is the
principal and representative of JAZ.
Counsel for the Ad Hoc Committee of Non-Consenting Creditors:
David Dare, Esq.
HERREN, DARE & STREETT
439 South Kirkwood Road, Suite 204
St. Louis, MO 63122
Telephone: (314) 965-3373
Facsimile: (314) 965-2225
Email: ddare@hdsstl.com
- and -
Gerard Uzzi, Esq.
Eric K. Stodola, Esq.
MILBANK, TWEED, HADLEY & McCLOY LLP
28 Liberty Street
New York, NY 10005
Telephone: (212) 530-5000
Facsimile: (212) 822-5846
Email: guzzi@milbank.com
estodola@milbank.com
- and -
Andrew M. Leblanc, Esq.
MILBANK, TWEED, HADLEY & McCLOY LLP
1850 K Street, NW, Suite 1100
Washington, DC 20006
Telephone: (202) 835-7500
Facsimile: (202) 263-7586
Email: aleblanc@milbank.com
Counsel to JAZ Ventures, LP:
Ryan T. Brown, Esq.
GORDON & REES
One North Franklin, Suite 800
Chicago, IL 60606
Tel: (312) 980-6762
Fax: (312) 565-6511
E-mail: rtbrown@gordonrees.com
- and -
Kirk B. Burkley, PA, Esq.
BERNSTEIN-BURKLEY, P.C.
Grant Street, Suite 2200
Pittsburgh, PA 15219
Tel: 412) 456-8100
Fax: (412) 456-8135
E-mail: kburkley@bernsteinlaw.com
About Peabody Energy Corporation
Headquartered in St. Louis, Missouri, Peabody Energy Corporation
claims to be the world's largest private-sector coal company. As
of Dec. 31, 2014, the Company owned interests in 26 active coal
mining operations located in the United States (U.S.) and
Australia. The Company has a majority interest in 25 of those
mining operations and a 50% equity interest in the Middlemount
Mine in Australia. In addition to its mining operations, the
Company markets and brokers coal from other coal producers, both
as principal and agent, and trade coal and freight-related
contracts through trading and business offices in Australia,
China, Germany, India, Indonesia, Singapore, the United Kingdom
and the U.S.
Peabody posted a net loss of $1.988 billion for 2015, wider from
the net loss of $777 million in 2014 and the $513 million net loss
in 2013.
At Dec. 31, 2015, the Company had total assets of $11.02 billion
against $10.1 billion in total liabilities, and stockholders'
equity of $919 million.
On April 13, 2016, Peabody Energy Corp. and 153 affiliates filed
voluntary petitions for relief under Chapter 11 of the United
States Bankruptcy Code. The 154 cases are pending joint
administration before the Honorable Judge Barry S. Schermer under
(Bankr. E.D. Mo. Case No. 16-42529).
As of the Petition Date, PEC has approximately $4.3 billion in
outstanding secured debt obligations and $4.5 billion in
outstanding unsecured debt obligations.
The Debtors tapped Jones Day as general counsel; Armstrong,
Teasdale LLP as local counsel; Lazard Freres & Co. LLC and
investment banker Lazard PTY Limited as investment banker; FTI
Consulting, Inc., as financial advisors; and Kurtzman Carson
Consultants, LLC, as claims, ballot and noticing agent.
The Office of the U.S. Trustee on April 29, 2016, appointed seven
creditors of Peabody Energy Corp. to serve on the official
committee of unsecured creditors. The Committee retained Morrison
& Foerster LLP as counsel, Spencer Fane LLP as local counsel,
Curtis, Mallet-Prevost, Colt & Mosle LLP as conflicts counsel,
Blackacre LLC as its independent expert, and Berkeley Research
Group, LLC, as financial advisor.
PERFORMANCE SPORTS: Seeks OK of Pre-Closing Reorganization Deals
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BPS US Holdings Inc., and its debtor-affiliates ask the Bankruptcy
Court to approve certain corporate restructuring transactions in
connection with and prior to the closing of the Debtors'
going-concern sale.
According to the Debtors, the Pre-Closing Reorganization is
necessary to, among other things, minimize the possibility of an
estimated Cdn $10 million or more in potential tax liability on the
sale of the Debtors' assets ensures that assets in European legal
structures are appropriately repatriated to the Debtors' estates,
and satisfies intercompany payables and receivables between certain
of the Debtors incorporated in Canada and foreign non-Debtor
entities that will be acquired by the purchaser.
The Pre-Closing Reorganization involves these steps:
a) Canada Realignment
i) In Canada, the Canadian Debtors that are direct or
indirect subsidiaries of Performance Sports Group
Ltd., the Canadian parent of all the Debtors, will
implement a short-form vertical amalgamation under
Canadian company -- Amalco -- for the Debtors.
Pursuant to the laws of B.C., the property, rights
and interests of each Canadian Debtor continue to
be the property, rights and interests of Amalco
and Amalco continues to be liable for the
obligations of each Canadian Debtor.
ii) For Canadian tax purposes, the amalgamation of the
separate Canadian Debtors into a single legal
entity consolidates the tax attributes and tax
liabilities thereby maximizing tax efficiencies
across the Canadian corporate group in connection
with the Sale.
b) The Intercompany Loan Clean-up
i) By way of background, a number of intercompany
loans and variable trade balances exist by and
among certain of the Canadian Debtors and the
non-Debtors, and by and among certain of the
non-Debtors. The Foreign Intercompany Obligations
include trade accounts payable/receivable and
intercompany loans.
ii) The Foreign Intercompany Obligations will be
addressed through a series of offsets,
assignments, dividends and distributions by and
among the non-Debtors and the Canadian Debtors,
and by and among the non-Debtors.
iii) If any amounts owing by a Debtor to one of the
entities that the Stalking Horse Purchaser will
acquire under the Stalking Horse Agreement, or
by an Acquired Entity and a selling Debtor,
cannot be settled either in the manner described
or through an alternative Pre-Closing
Reorganization pursuant to Section 5.18 of the
Stalking Horse Agreement, then such amounts will
be settled for no consideration prior to the
Closing Date as part of the Sale.
c) The Luxco Unwind
By way of background, the funds used to acquire the
Easton baseball/softball business in 2014 were borrowed by
the parent company, PSG, and transferred to an acquisition
vehicle through a series of intercompany loans and
contributions. The loans, and related tax efficient
structures including Debtor BPS Canada Intermediate Corp.,
and non-Debtor BPS Luxembourg S.a.r.l. ("Luxco"), remain
in place but will no longer serve any viable corporate
function after the Sale closes. Moreover, their continued
existence after the Sale closes would raise a risk that
income could be imputed to the Canadian estates for
Canadian income tax purposes. Accordingly, through the
Pre-Closing Reorganization, the Debtors intend to implement
the Luxco Unwind to eliminate intercompany receivables,
dissolve the corporate legal entities that are no longer
needed and repatriate cash to the Debtors. Following the
Canada Realignment, the Luxco Unwind will include these
steps:
i) Luxco has a loan payable to Amalco in the amount
of $247 million (the "BHC Note"). Luxco has a
loan
receivable from U.S. Debtor BPS US Holdings Inc.
in the amount of $250 million (the "BPS US Note").
Luxco also has an upstream loan payable to Amalco
in the amount of $420,626.
ii) Luxco will repay the BHC Note (a) in kind by
transferring $247 million of the BPS US Note to
Amalco and (b) repaying $3 million of capital to
Amalco by distributing the remaining $3 million
of the BPS US Note.
iii) Luxco will pay an in-kind dividend equal to the
amount of the upstream loan (i.e., $420,626) to
Amalco.
iv) Luxco will declare and pay a dividend equal to the
remaining cash in the corporation and the amount
of accrued interest owing to it under the BPS US
Note, less liabilities, after which Luxco will be
dissolved.
As reported by the Troubled Company Reporter, the Debtors have
entered into an agreement for the going-concern sale of
substantially all of the Company's assets to a group of investors
led by Sagard Capital Partners, L.P., subject to a Court-supervised
auction process. Pursuant to the Stalking Horse Agreement, the
Stalking Horse Purchaser has agreed to acquire substantially all of
the Debtors' assets for the base purchase price of U.S. $575
million (subject to certain adjustments), plus the assumption of
related operating liabilities, and serve as a "stalking horse"
bidder in the Bankruptcy Proceedings.
On Nov. 30, 2016, the Court entered an order approving bid
procedures to govern the Sale. The Court established a bid
deadline of Jan. 25, 2017, scheduled an auction for January 30,
2017, and scheduled a hearing on Feb. 6, 2017 to consider the Sale.
On Jan. 6, 2017, Performance Sports entered into a First Amendment
to the Asset Purchase Agreement, dated as of Oct. 31, 2016, by and
among the Company, the subsidiaries of the Company party thereto
and 9938982 Canada Inc., an acquisition entity financed by Sagard
Holdings Inc. and Fairfax Financial Holdings Limited. The First
Amendment amends the Asset Purchase Agreement in response to the
Bidding Procedures Orders entered by the U.S. Bankruptcy Court and
the CCAA Court, and provides, among other things, that (1) the
amount of the "good faith deposit" that the Purchaser was required
to deposit pursuant to the terms of the Asset Purchase Agreement be
reduced to $17,250,000, (2) the amount of the break-up fee payable
to the Purchaser upon the consummation of an alternate transaction
or in certain other circumstances where the transactions
contemplated by the Asset Purchase Agreement are not consummated,
in each case in accordance with the Asset Purchase Agreement, be
reduced to $17,250,000, and (3) certain key dates (including the
targeted closing date and the deadline for the entry of the Sales
Orders (as defined in the Asset Purchase Agreement)) be extended.
A copy of the First Amendment is available at https://is.gd/igmKTk
About Performance Sports
Exeter, N.H.-based Performance Sports Group Ltd. (NYSE: PSG) (TSX:
PSG) -- http://www.PerformanceSportsGroup.com/-- is a developer
and manufacturer of ice hockey, roller hockey, lacrosse, baseball
and softball sports equipment, as well as related apparel and
soccer apparel. Its products are marketed under the BAUER,
MISSION, MAVERIK, CASCADE, INARIA, COMBAT and EASTON brand names
and are distributed by sales representatives and independent
distributors throughout the world. In addition, the Company
distributes its hockey products through its Burlington,
Massachusetts and Bloomington, Minnesota Own The Moment Hockey
Experience retail stores.
On Oct. 31, 2016, Performance Sports Group Ltd. and certain of its
affiliates have filed voluntary petitions under Chapter 11 of the
Bankruptcy Code in the District of Delaware and commenced
proceedings under the Companies' Creditors Arrangement Act in the
Ontario Superior Court of Justice.
The U.S. Debtors are: BPS US Holdings Inc.; Bauer Hockey, Inc.;
Easton Baseball/Softball Inc.; Bauer Hockey Retail Inc.; Bauer
Performance Sports Uniforms Inc.; Performance Lacrosse Group Inc.;
BPS Diamond Sports Inc.; and PSG Innovation Inc.
The Canadian Debtors are: Performance Sports Group Ltd.; KBAU
Holdings Canada, Inc.; Bauer Hockey Retail Corp.; Easton Baseball
/Softball Corp.; PSG Innovation Corp. Bauer Hockey Corp.; BPS
Canada Intermediate Corp.; BPS Diamond Sports Corp.; Bauer
Performance Sports Uniforms Corp.; and Performance Lacrosse Group
Corp.
Ernst & Young Inc., serves as monitor to the Company in the
Canadian Proceedings.
The Debtors have hired Paul, Weiss, Rifkind, Wharton & Garrison
LLP
as counsel; Young Conaway Stargatt & Taylor, LLP as co-counsel;
Stikeman Elliott LLP as Canadian legal counsel; Centerview LLP as
investment banker to the special committee; Alvarez & Marsal North
America, LLC, as restructuring advisor; Joele Frank, Wilkinson,
Brimmer, Katcher as communications & relations advisor; KPMG LLP
as
auditors; Ernst & Young LLP as CCAA monitor; and Prime Clerk LLC
as notice, claims, solicitation and balloting agent.
Andrew R. Vara, Acting U.S. Trustee for Region 3, has appointed
three creditors of BPS US Holdings, Inc., parent of Performance
Sports, to serve on the official committee of unsecured creditors.
The Creditors' Committee retained by Blank Rome LLP as counsel,
Cassels Brock & Blackwell LLP as Canadian co-counsel, and Province
Inc. as financial advisor.
The U.S. Trustee also has appointed a official committee of equity
security holders. The equity committee is represented by Natalie
D. Ramsey, Esq., and Mark A. Fink, Esq., at Montgomery, McCracken,
Walker & Rhoads, LLP; and Robert J. Stark, Esq., Steven B. Levine,
Esq., James W. Stoll, Esq., and Andrew M. Carty, Esq., at Brown
Rudnick LLP.
PRESIDENTIAL REALTY: Jeffrey Rogers Holds 5.4% of Class B Stock
---------------------------------------------------------------
Jeffrey S. Rogers disclosed in a Schedule 13D filed with the
Securities and Exchange Commission that as of Jan. 6, 2017, he
beneficially owns 282,076 shares of Class B Common Stock, $.00001
par value, of Presidential Realty Corporation representing 5.40
percent of the shares outstanding. Mr. Rogers is the president and
chief executive officer, LiftForward Inc.
On Jan. 6, 2017, the Company and Mr. Rogers entered into the
Issuance and Release Agreement pursuant to which the Reporting
Person was issued 90,000 shares of Class B Common Stock in
consideration for the release of any right to director fees in
consideration of his services as an independent member of the Board
of Directors for the 2015 and 2016 calendar years.
A full-text copy of the regulatory filing is available at:
https://is.gd/BkyhkX
About Presidential Realty
Headquartered in White Plains, New York, Presidential Realty
Corporation, a real estate investment trust, (i) owns
income-producing real estate and (ii) holds notes and mortgages
secured by real estate or interests in real estate. On Jan. 20,
2011, Presidential stockholders approved a plan of liquidation,
which provides for the sale of all of the Company's assets over
time and the distribution of the net proceeds of sale to the
stockholders after satisfaction of liabilities.
Presidential Realty reported a net loss of $495,400 on $932,000 of
total revenues for the year ended Dec. 31, 2015, compared to a net
loss of $941,050 on $871,499 of total revenues for the year ended
Dec. 31, 2014.
As of Sept. 30, 2016, Presidential Realty had $975,200 in total
assets, $2.50 million in total liabilities and a total
stockholders' deficit of $1.53 million.
Baker Tilly Virchow Krause, LLP, in Melville, New York, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2015, citing that the
Company has suffered recurring losses from operations and has a
working capital deficiency. These factors raise substantial doubt
about its ability to continue as a going concern.
PRESIDENTIAL REALTY: President Owns 8.7% of Class B Common Stock
----------------------------------------------------------------
Alexander Ludwig disclosed in a Schedule 13D filed with the
Securities and Exchange Commission that as of Jan. 6, 2017, he
beneficially owns 450,000 shares of Class B Common Stock, $.00001
par value, of Presidential Realty Corporation representing 8.7
percent of the shares outstanding.
Mr. Ludwig is a director, president, chief operating officer and
principal financial officer of the Company. He said he has no
present plans or proposals that relate to or that would result in
any of the actions.
On Jan. 6, 2017, the Company and Mr. Ludwig entered into the Stock
Option Agreement pursuant to which the Reporting Person was issued
450,000 shares of Class B Common Stock and an option to purchase
550,000 shares of Class B Common Stock in consideration for the
cancellation of his options and warrants and other obligations owed
or to be owed to him by the Company (other than obligations arising
from an Interest Contribution Agreement by and among the Company,
Presidential Realty Operating Partnership LP, First Capital Real
Estate Trust Incorporated, First Capital Real Estate Operating
Partnership, Township Nine Owner, LLC, Capital Station Holdings,
LLC, Capital Station Member, LLC, Capital Station 65 LLC and Avalon
Jubilee LLC and employment compensation). The Contingent Option is
subject to certain conditions, including that the Company has
consummated an equity offering, capital raise or such other
offering such that the issuance of any shares of Class B Common
Stock of the Company covered by the Reporting Person's option would
not be deemed "Excess Shares" as that term is defined in the
certificate of incorporation of the Company. Inasmuch, as the
Contingent Option will not become exercisable within sixty days of
Jan. 17, 2017, under current circumstances, the Reporting Person
disclaims ownership of the Class B Common Stock underlying the
Contingent Option.
A full-text copy of the regulatory filing is available at:
https://is.gd/GVu2QD
About Presidential Realty
Headquartered in White Plains, New York, Presidential Realty
Corporation, a real estate investment trust, (i) owns
income-producing real estate and (ii) holds notes and mortgages
secured by real estate or interests in real estate. On Jan. 20,
2011, Presidential stockholders approved a plan of liquidation,
which provides for the sale of all of the Company's assets over
time and the distribution of the net proceeds of sale to the
stockholders after satisfaction of liabilities.
Presidential Realty reported a net loss of $495,400 on $932,000 of
total revenues for the year ended Dec. 31, 2015, compared to a net
loss of $941,050 on $871,499 of total revenues for the year ended
Dec. 31, 2014.
As of Sept. 30, 2016, Presidential Realty had $975,200 in total
assets, $2.50 million in total liabilities and a total
stockholders' deficit of $1.53 million.
Baker Tilly Virchow Krause, LLP, in Melville, New York, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2015, citing that the
Company has suffered recurring losses from operations and has a
working capital deficiency. These factors raise substantial doubt
about its ability to continue as a going concern.
PRESIDENTIAL REALTY: Richard Brandt Holds 5.6% of Class B Stock
---------------------------------------------------------------
Richard Paul Brandt, a director of Presidential Realty Corporation,
disclosed in a Schedule 13D filed with the Securities and Exchange
Commission that as of Jan. 6, 2017, he beneficially owns 291,000
shares of Class B Common Stock, $0.00001 par value, of the Company
representing 5.6 percent of the shares outstanding.
The Class B Common Stock was acquired in exchange for the release
of any right to director fees in consideration of his services as
an independent member of the Board of Directors for the 2015 and
2016 calendar years and as compensation for the Reporting Person's
involvement in reviewing the proposed transactions contemplated by
an Interest Contribution Agreement by and among the Company,
Presidential Realty Operating Partnership LP, First Capital Real
Estate Trust Incorporated, First Capital Real Estate Operating
Partnership, Township Nine Owner, LLC, Capital Station Holdings,
LLC, Capital Station Member, LLC, Capital Station 65 LLC and Avalon
Jubilee LLC.
A full-text copy of the regulatory filing is available at:
https://is.gd/f6kBwp
About Presidential Realty
Headquartered in White Plains, New York, Presidential Realty
Corporation, a real estate investment trust, (i) owns
income-producing real estate and (ii) holds notes and mortgages
secured by real estate or interests in real estate. On Jan. 20,
2011, Presidential stockholders approved a plan of liquidation,
which provides for the sale of all of the Company's assets over
time and the distribution of the net proceeds of sale to the
stockholders after satisfaction of liabilities.
Presidential Realty reported a net loss of $495,400 on $932,000 of
total revenues for the year ended Dec. 31, 2015, compared to a net
loss of $941,050 on $871,499 of total revenues for the year ended
Dec. 31, 2014.
As of Sept. 30, 2016, Presidential Realty had $975,200 in total
assets, $2.50 million in total liabilities and a total
stockholders' deficit of $1.53 million.
Baker Tilly Virchow Krause, LLP, in Melville, New York, issued a
"going concern" qualification on the consolidated financial
statements for the year ended Dec. 31, 2015, citing that the
Company has suffered recurring losses from operations and has a
working capital deficiency. These factors raise substantial doubt
about its ability to continue as a going concern.
PROFESSIONAL MEDICAL: Unsecureds to Get 100% at 3% in 120 Months
----------------------------------------------------------------
Professional Medical Management filed with the U.S. Bankruptcy
Court for the District of Arizona a first disclosure statement
referring to the Debtor's first plan of reorganization dated Jan.
18, 2017.
Class 4 Unsecured Deficiency Claims and Unsecured Claims --
estimated at $28,373.76, which does not include any deficiency
amounts for secured creditors -- is impaired under the Plan.
The Plan provides that each and every holder of a Class 4 Allowed
Claim will be paid 100% of the allowed amount of their claims at
3.0% interest on the unpaid balance in 120 equal monthly
installments with the first payment due 60 days from the Effective
Date. Any liens held by the Class 4 creditors will be null and
void and removed as of the Effective Date.
The Plan contemplates that secured creditors will be paid the full
amount of their allowed claims. The Debtor does not believe a new
capital contribution is required as allowed claims are being paid
in full.
Potential investors may be allowed to acquire a percentage of
interest or a percentage thereof, in the Reorganized Debtor. These
proceeds, in conjunction with the property's revenues and inherent
future appreciation, will provide the necessary funds to the Debtor
to pay creditors under the Plan.
The First Disclosure Statement is available at:
http://bankrupt.com/misc/azb16-05820-44.pdf
About Professional Medical Management
Professional Medical Management Inc. sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No.
16-05820) on May 23, 2016, disclosing under $1 million in both
assets and liabilities.
The Debtor is represented by Eric Slocum Sparks, at the Law Offices
of the Eric Slocum Sparks P.C. The Debtor employs Mark Metzger at
Metzger, Klawon & Fox, PLC, as certified public accountant.
The Office of the U.S. Trustee disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of Professional Medical Management Inc.
PROGRESSIVE CROP: U.S. Trustee Unable to Appoint Committee
----------------------------------------------------------
The Office of the U.S. Trustee on Jan. 20 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of Progressive Crop Service, LLC.
Progressive Crop Service, LLC sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. N. D. Ohio Case No. 16-62431) on
November 28, 2016.
The case is assigned to Judge Russ Kendig. Edwin H. Breyfogle,
Esq., serves as the Debtor's legal counsel.
At the time of the filing, the Debtor estimated assets and
liabilities of less than $1 million.
PROWLER ACQUISITION: S&P Alters Outlook to Neg. & Affirms CCC+ CCR
------------------------------------------------------------------
S&P Global Ratings said it revised its outlook on Houston-based
specialty product distributor Prowler Acquisition Corp. to negative
from stable. At the same time, S&P Global Ratings affirmed its
'CCC+' long-term corporate credit rating on the company.
S&P Global Ratings also lowered its issue-level rating on Prowler's
senior secured first-lien term loan and revolving credit facility
one notch to 'CCC+' from 'B-'. S&P Global Ratings revised its
recovery rating on the debt to '3' from '2'. A '3' recovery
rating, indicates an expectations for meaningful (50%-70%; higher
end of the scale) recovery in the event of default.
S&P affirmed its 'CCC-' senior secured issue-level rating on
Prowler's second-lien term loan. The '6' recovery rating on the
notes is unchanged, indicating S&P's expectations for negligible
(0%-10%) recovery in the event of a default.
"The negative outlook reflects our view that the company could
consider a distressed exchange offer over the next two years," said
S&P Global Ratings credit analyst Valiant Ip. This is based on
S&P's view that the company's financial performance is
unsustainable without any favorable business and market conditions,
given that its debt will be maturing in the next two to three
years. The affirmation on the corporate credit rating reflects
from S&P's view that, although the company's financial landscape
and the associated credit metrics have deteriorated considerably
since 2015, S&P believes Prowler will continue to have adequate
liquidity to cover its operating and capital expenditures and make
its principal and interests payments over the next 12 months
without violating any financial covenant under the revolving credit
facility.
The downgrade on Prowler's senior secured first-lien term loan and
the revolving credit facility one notch is based on S&P's
assessment that the recovery expectations for the debt would be at
the higher end of the 50%-70% range. (Previously, S&P had assessed
recovery in the 70%-90% range and notched up the senior debt one
notch as a result.)
Due to low oil prices and unfavorable market conditions and delays
to some projects in the midstream sector, S&P's adjusted-EBITDA for
Prowler at fiscal year-end 2016 is estimated at about
$27 million, a decrease of more than 28% from fiscal year-end 2015.
In S&P's view, Prowler relies heavily on new build projects in the
midstream sector to drive revenue growth, as they represent more
than 40% of total revenues. Moreover, revenues from the midstream
sector represent more than 50% of the company's total revenue. As
a result, any significant delays to the major projects in the
midstream sector would have a material impact on the company's
revenue.
The 'CCC+' rating reflects S&P's view of Prowler as vulnerable and
dependent on favorable business, financial, and economic conditions
to meet its financial obligations. Therefore, the business risk
and financial risk profiles are no longer the determining factors
in assessing the credit risk on the company.
S&P's key concern at the current corporate credit rating level is
the company's ability to meet its financial obligations without
violating any of the financial covenants over the next 12 months.
The negative outlook reflects S&P's view that there is a
possibility that the company could consider a distressed exchange
offer over the next 24 months without any favorable market and
financial conditions, given that its debt will be maturing in the
next two to three years.
S&P could lower the rating if there is further deterioration in
Prowler's financial performance or a substantial draw on remaining
liquidity sources, resulting in a heightened risk of default in the
next 12 months. In this situation S&P expects that the company is
likely to consider a distressed exchange offer.
S&P could revise the outlook back to stable if market conditions
improve, resulting in stronger demand for new build projects in the
midstream sector and increased demand in the downstream segment
leading to a material improvement in S&P's adjusted EBITDA to $33
million-$35 million range.
QUINN'S JUNCTION: Intends to Continue Using Cash Thru April 30
--------------------------------------------------------------
Quinn's Junction Properties, LC, asks the U.S. Bankruptcy Court for
the District of Utah for final authorization to use the cash
collateral for the operation of its business in the ordinary course
through April 30, 2017.
The Debtor owns real property improved with facilities including a
film studio, soundstages, production offices and related
structures, commonly known as the Park City Film Studios in Park
City, UT. The real property is managed and operated by the
Debtor's wholly-owned subsidiary, Park City Film Studios
Development Company, LC.
The Debtor relates that the real property generates rental income
which constitutes cash collateral of the Debtor's creditors. The
Debtor further relates that the rental income is received by Park
City Film.
The cash collateral Budget for the period from February 1, 2017 to
April 30, 2017, reflects total estimated cash expenditures of
$124,240 for Quinn's Junction Properties and $180,192 for Park City
Film Studios.
The Debtor tells the Court that it had previously obtained approval
for two rounds of postpetition financing from R3 Media Corporation
in the aggregate amount of $200,000. The Debtor anticipates
obtaining additional loans as needed from R3 Media. The Debtor
also tells the Court that the loans from R3 Media provide the
primary source for funding payment of postpetition operating
expenses and/or administrative expenses of the Debtor.
The Debtor contends that Bank of Utah has a secured claim of
approximately $4 million, pursuant to a construction loan secured
by a first position deed of trust on the Real Property. The Debtor
adds that Quinn Capital Partners, LLC, with its principal Gary
Crandall and entities owned by Mr. Crandall including Newpark
Retail, LLC, and Harmony Health, LLC, assert second and third liens
on the Real Property. Quinn Capital asserts a junior lien on the
rents.
The Debtor says that it entered into a Court-approved adequate
protection stipulation with the Bank of Utah, which provides that
the Debtor will make interest-only payments of $23,883 per 30-day
month to the Bank of Utah, pursuant to the Bank of Utah's secured
loan.
The Debtor submits that Quinn Capital, as well as Bank of Utah,
will be adequately protected because there is an equity cushion in
the Real Property which vastly exceeds the combined value of all
liens on the Real Property.
In addition, the Debtor tells the Court that Quinn Capital is also
adequately protected because of (a) the payments that the Debtor
will make to Bank of Utah on account of Bank of Utah's first
priority secured claim, (b) through the R3M loans to fund the
continued operation of the Real Property, and (c) the enhancements
in the value of the Real Property that naturally results from its
operation.
A full-text copy of the Debtor's Motion, dated Jan. 12, 2017, is
available at https://is.gd/q9cUuv
About Quinn's Junction Properties
Quinn's Junction Properties, LC, filed a chapter 11 petition
(Bankr. D. Utah Case No. 16-24458) on May 23, 2016. The petition
was signed by Michael Martin, chief restructuring officer. The
case is assigned to Judge Joel T. Marker. At the time of filing,
the Debtor estimated both assets and liabilities in the range of
$10 million to $50 million.
George B. Hofmann, Esq., at Cohne Kinghorn PC, serves as the
Debtor's general bankruptcy counsel. Stanley J. Preston, Esq., at
Preston & Scott, LLC, serves as the Debtor's special litigation
counsel.
The Debtor is managing its assets and properties as
debtor-in-possession. No trustee or examiner has been appointed,
and no official committee of creditors or equity interest holders
has yet been established.
RENNOVA HEALTH: Director's Death Triggers Nasdaq Noncompliance
--------------------------------------------------------------
Rennova Health, Inc. filed a current report on Form 8-K with the
Securities and Exchange Commission on Dec. 21, 2016, to disclose
that one of the Company's independent directors, Benjamin Frank,
passed away on Dec. 18, 2016.
On Jan. 11, 2017, the Company was notified by Nasdaq that the
Company no longer complies with Nasdaq's audit committee
requirements as set forth in Nasdaq Listing Rule 5605, which
requires the audit committee of the Company's board of directors to
have at least three members, each of whom must be independent
directors as defined under the Rule.
In accordance with Nasdaq Rule 5605(c)(4), the Company has a cure
period in order to regain compliance. The Company has until the
earlier of its next annual shareholders' meeting or Dec. 18, 2017,
to regain compliance; or, if the Company's next annual
shareholders' meeting is held before June 16, 2017, then the
Company must evidence compliance no later than June 16, 2017. If
the Company does not regain compliance by the foregoing applicable
dates, then Nasdaq will provide written notification to the Company
that its securities will be delisted. The Company expects that it
will appoint a replacement for Mr. Frank and regain compliance with
the Rule within the required timeframe.
About Rennova
Rennova Health, Inc., is a vertically integrated provider of a
suite of healthcare related products and services. Its principal
lines of business are diagnostic laboratory services, and
supportive software solutions and decision support and informatics
operations services.
The Company reported a net loss attributable to the Company's
common shareholders of $36.4 million for the year ended Dec. 31,
2015, following net income attributable to the Company's common
shareholders of $2.81 million for the year ended Dec. 31, 2014.
As of Sept. 30, 2016, Rennova Health had $10.19 million in total
assets, $20.23 million in total liabilities and a total
stockholders' deficit of $10.03 million.
The Company said in its annual report for the year ended Dec. 31,
2015, that "Although our financial statements have been prepared on
a going concern basis, we have recently accumulated significant
losses and have negative cash flows from operations, which raise
substantial doubt about our ability to continue as a going
concern.
"If we are unable to improve our liquidity position we may not be
able to continue as a going concern. The accompanying consolidated
financial statements do not include any adjustments that might
result if we are unable to continue as a going concern and,
therefore, be required to realize our assets and discharge our
liabilities other than in the normal course of business which could
cause investors to suffer the loss of all or a substantial portion
of their investment."
RENT-A-CENTER INC: S&P Puts 'BB-' CCR on CreditWatch Negative
-------------------------------------------------------------
S&P Global Ratings placed its ratings, including the 'BB-'
corporate credit rating, on Texas-based Rent-A-Center Inc. on
CreditWatch with negative implications.
Rent-A-Center has pre-announced weak fourth-quarter
comparable-store sales below S&P's expectations and lowered its
2016 earnings guidance.
The CreditWatch placement follows the company's announcement that
same-store sales in its core business, which represents about 70%
of overall revenues, declined 14% in the fourth quarter of 2016.
Rent-A-Center also reported higher promotions, elevated payment
delinquencies in its rental portfolio, and an overall 10% reduction
in revenue stream per store.
The negative CreditWatch placement indicates at least a 50% chance
that S&P could lower the ratings at least one notch in the next
three months. The extent of any downgrade will incorporate S&P's
view of Rent-A-Center's ability to cope with the cyclical decline
of the overall RTO industry, effectively compete with its main
competitor Aaron's, and move past the internal systems outages and
staffing issues it has faced recently.
Amid the low interest rate environment of the past few years, the
company's target subprime consumers have had increased access to
credit options from commercial banks and consumer finance
companies. S&P believes heightened consumer education has also
informed customers of the full cost of the RTO transaction if taken
to full term. In S&P's view, if these challenges continue, they
could more than offset the company's various operating initiatives
on a sustained basis and affect both Rent-A-Center's competitive
standing and credit metrics.
S&P expects to resolve the CreditWatch placement within the next
few months, after evaluating the severity and pace of ongoing weak
operating trends, gaining clarity on covenant compliance (inclusive
of any potential amendment to resolve the breach of the minimum
fixed-charge coverage covenant if it occurs), and understanding the
financial impact of store closures and initiatives to improve
delinquencies and collections in the company's RTO portfolio.
RO & SONS INC: Has Authorization to Use Cash Collateral
-------------------------------------------------------
Judge Eduardo V Rodriguez of the U.S. Bankruptcy Court for the
Southern District of Texas authorized Ro & Sons, Inc., d/b/a Motel
9, to use cash collateral.
The Debtor will be allowed to use the cash collateral in the amount
of $52,558 per month to continue to operate its business, in
accordance with the approved Budget.
Falcon Bank was granted a replacement lien on all income of the
Debtor, to include contract for deed payments, rents, and any and
all accounts receivable acquired by the Debtor since the filing of
the petition, with such lien and replacement lien to continue until
further Order of the Court or confirmation of a Plan of
Reorganization.
The Debtor was directed to make periodic monthly payments of $5,767
each month to Falcon Bank from the Budgeted Amount, beginning on
January 20, 2017, which will be applied to the interest accrual on
the Debtor's two Falcon Bank notes which are secured by the
Debtor's properties at 2503 E. Saunders, Laredo, TX and 9017 San
Dario, Laredo, TX.
The Debtor will also pay to Falcon Bank the amount of $5,000, which
amount will be held in escrow by the Bank and used to pay the 2017
ad valorem taxes on the Debtor's two properties.
In addition, the Debtor was also directed to make monthly deposit
into its Wells Fargo DIP account the amount of $9,044 to hold in
escrow for the payment of occupancy taxes to the City, County, and
State, and monthly file complete copies of the monthly statements
for its DIP Accounts, to include copies of all payment and deposit
items.
The Debtor is also directed to provide to Falcon Bank proof of
insurance against loss or damage on all of the Debtor's real
properties with the Bank named as a loss payee on the insurance.
A full-text copy of the Agreed Order, dated January 12, 2017, is
available at https://is.gd/lcE69i
About Ro & Sons, Inc. DBA Motel 9
Ro & Sons, Inc., d/b/a Motel 9, filed a Chapter 11 petition (Bankr.
S.D. Tex. Case No. 16-50241), on Dec. 6, 2016. The petition was
signed by Pablo E. Rodriguez, president. The case is assigned to
Judge Eduardo V Rodriguez. The Debtor is represented by Carl
Michael Barto, Esq. at the Law Offices of Carl M. Barto. At the
time of filing, the Debtor had total assets of $4.04 million and
total liabilities in the amount of $1.57 million.
ROBERT JOHNSON: Kheshvadjian Buying 2011 Ford Flex for $9.4K
------------------------------------------------------------
Jeffrey I. Golden, Trustee for Robert Vilas Johnson and Linda
Joyce, asks the U.S. Bankruptcy Court for the Central District of
California to authorize the sale of Debtors' 2011 Ford Flex,
Vehicle Identification Number 2FMHK6DT6DDD26645, License Plate
Number 6RCW489, to Levon Kheshvadjian, doing business as Matrix
Towing, for $9,400, subject to overbid.
A hearing on the Motion is set for Feb. 7, 2017 at 10:00 a.m.
On the Petition Date, the Debtors filed their bankruptcy schedules,
including Schedules B and C. The Debtors listed a 2006 Mercededs
E55 and the Property in Schedule B, and exempted $1,165 as to the
Mercedes in Schedule C. As the vehicles were unencumbered, and the
property of the estate had been used to create the equity that
existed in the vehicles, on June 21, 2016, the Trustee filed the
Turnover Motion, for among other things, turnover of the vehicles
to enable the Trustee to liquidate the vehicles for the benefit of
the estate and its creditors.
On Sept. 2, 2016, the Court entered an order granting the Turnover
Motion, which among other things required to turnover the Property
to the Trustee on Aug. 29, 2016 and execute and surrender all
documentation(s), slip(s), and/or certificate(s), and a transfer of
title from the Debtors (or either of them) necessary to effectuate
the Turnover.
On Sept. 27, 2016, the Debtors turned over the Property to the
Trustee and executed the Transfer Documents. The Property is
unencumbered and has approximately 125,435 miles on it.
After marketing the Property for nearly 2 months, on Oct. 15, 2016,
the Trustee received an offer from the Buyer to acquire the
Property for the sum of $9,400. The Buyer has agreed to purchase
the Property on an "as is, where is" basis. To this end, on Dec.
29, 2016, the Buyer delivered a cashier's check in the amount of
$9,400. The sale is conditioned upon the sale of the Property free
and clear of liens, claims, interests and encumbrances and entry of
a finding that the Buyer constitutes a good faith purchaser, and
closing within 15 days of the date the order approving the sale
becomes a final order. The Sale is subject to Court approval and
potential overbid.
The material terms of the sale are:
a. Buyer: Levon Kheshvadjian
b. Purchase Price: $9,400
c. Earnest Money Deposit: $5,700
d. Condition of the Property: The Property will be sold
in an "as is, where is" basis condition without any representations
or warranties, free and clear of any and all liens and
encumbrances.
e. Closing Date: Within 15 days after the Sale Order
becomes the Final Order.
f. Closing Cost: The Buyer will bear any cost(s) related
to the transfer of the Property, including but not limited to any
transfer taxes which may be applicable.
The Trustee believes that the sale is in the best interest of the
Estate and its creditors, as the sale reflects the highest and best
offer received for the Property to date. Accordingly, the Trustee
asks that the Court approve the Sale to the Buyer on the terms set
forth. In the event that the Trustee receives any additional
offers to purchase the Property prior to or at the hearing on the
Motion, which he deems, in his sole and absolute discretion, to be
better than the Offer, the Trustee will conduct an auction at the
hearing to approve the Motion.
Although the Closing Date is currently scheduled to be within 15
days after the Sale Order becomes the Final Order, the waiver of
the stay imposed by Rule 6004(h) is appropriate in order to enable
a more expeditious closing. The waiver will not result in any
prejudice. The Trustee does not expect to receive any substantive
opposition to the Motion. Accordingly, the Trustee requests that
the Court waive the stay imposed by Rule 6004(h).
Counsel for the Debtors:
Ashley M. McDow, Esq.
Fahim Farivar, Esq.
BAKER & HOSTETLER LLP
11601 Wilshire Boulevard, 14th Floor
Los Angeles, CA 90025-0509
Telephone: (310) 820-8800
Facsimile: (310) 820-8859
E-mail: amcdow@bakerlaw.com
ffarivar@bakerlaw.com
Robert Vilas Johnson and Linda Joyce Johnson filed for chapter 11
bankruptcy (Bankr. C.D. Cal. Case No. 11-18629) on July 18, 2011.
S DIAMOND STEEL: Hearing on Plan Outline Set for Feb. 28
--------------------------------------------------------
The Hon. Brenda K. Martin of the U.S. Bankruptcy Court for the
District of Arizona has scheduled for Feb. 28, 2017, at 11:00 a.m.,
the hearing to consider the approval of S Diamond Steel, Inc.'s
disclosure statement and plan of reorganization filed on Jan. 16,
2017.
Objections to the Disclosure Statement must be filed on or before
five business days prior to the hearing of the Disclosure
Statement.
The Chapter 11 continued status hearing currently set for Feb. 23,
2017, at 11:00 a.m. is hereby vacated.
As previously reported by The Troubled Company Reporter, the
Debtor's Class 7 General Unsecured Claims will be paid in full from
all funds available for distribution. It is anticipated that
payments under this class will start in the seventh month of the
Plan. This class is impaired.
As of the filing date, Class 7 claims total $1,532,696.01. As of
Jan. 16, 2017, the claims total $1,137,518.47. Projected dividend
is $1,137,518.47, which totals about 74% of the total allowed
claim
amount.
The funds necessary for the satisfaction of all approved and
allowed claims will be derived from the Debtor's income from its
operations. The Debtor has continued to operate its business and
has seen increases in gross receipts since the filing of this
case.
The Debtor reserves the right to accelerate payment under the Plan
from financing obtained either from third party financing or in
the
event that is revenues permit it to do so. The Debtor believes
that by virtue of the Plan that it will have the ability to pay
all
allowed and approved claims pursuant to the Plan of
Reorganization.
The Disclosure Statement is available at:
http://bankrupt.com/misc/azb16-07846-85.pdf
About S Diamond Steel, Inc.
S Diamond Steel, Inc., based in Phoenix, AZ, filed a Chapter 11
petition (Bankr. D. Ariz. Case No. 16-07846) on July 11, 2016. The
petition was signed by Matthew Miles Stevens, president. The case
is assigned to Judge Brenda K. Martin. The Debtor is represented
by Allan NewDelman, Esq., at Allan D. NewDelman P.C. The Debtor
disclosed $1.59 million in total assets and $5.58 million in total
liabilities.
The Office of the U.S. Trustee disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of S Diamond Steel, Inc.
S. J. MEDICAL: Santos Trust Buying San Jacinto Property for $5.4M
-----------------------------------------------------------------
S. J. Medical, LLC, asks the U.S. Bankruptcy Court for the Central
District of California to authorize the sale of an improved
commercial real property commonly known as 1695 San Jacinto Ave.,
San Jacinto, California and personal property consisting of office
furniture, to Alfred and Barbara Santos Trust for $5,400,000,
subject to higher and better bids.
A hearing on the Motion is set for Feb. 14, 2017 at 1:30 p.m.
The Reorganized Debtor owns the improved commercial real estate in
San Jacinto, California, which consists of approximately .60 acres.
The Reorganized Debtor purchased the Property as vacant land and
developed an approximately 28,124 square foot 2-story medical
office building on the site with l8 medical office suites for
lease. The current occupancy rate for the Property is
approximately 92%.
PFF Bank & Trust provided the financing for development of the
Property. During the financial crisis of 2008 to 2009, the Federal
Deposit Insurance Corporation was appointed as the receiver for PFF
Bank & Trust. As of approximately April 2009, U.S. Bank National
Association was the successor in interest to the FDIC as receiver
for PFF Bank & Trust.
The construction loan for development of the Property matured in
2012. The Reorganized Debtor negotiated with U.S. Bank as well as
other lenders to obtain permanent financing to pay off the
construction loan. All efforts to obtain financing were
unsuccessful primarily because of the credit history of Robert E.
Osborne, Sr., a member of the reorganized Debtor. The Reorganized
Debtor filed a voluntary Chapter 11 petition on Sept. 16, 2013,to
stop the foreclosure sale scheduled by U.S. Bank. On Nov. 20, 2014,
the Reorganized Debtor filed the Debtor's Chapter 11 Liquidation
Plan Dated Nov. 20, 2014.
The Plan provides for the sale of the Property and the distribution
of the sale proceeds to pay all "Allowed Claims" as defined by the
Plan. On March 20, 2015, the Order Confirming the Plan was entered
by the Court. The Reorganized Debtor proposes to sell the Properly
to implement the terms of the Plan. The Reorganized Debtor
marketed the Property for sale during the Chapter 11 case and after
the Order confirming the Plan was entered on March 20,2015.
On Nov. 28, 2016, the Reorganized Debtor received the Standard
Offer. Agreement and Escrow Instructions For Purchase of Real
Property from the Buyer, dated Feb. 12, 1979 to purchase the
Property for $5,400,000. Thereafter, the Reorganized Debtor and
the Buyer engaged in negotiations regarding the terms and
conditions for the proposed sale, including the bidding procedures,
overbid protection and breakup fee for the sale. On Dec. 14, 2016,
the Reorganized Debtor and the Buyer executed the Standard Offer,
Agreement and Escrow Instructions For Purchase of Real Property,
including the Addendum thereto. The Reorganized Debtor determined
it was in the best interests of all creditors and the estate to
enter into the Agreement for the sale of the Property free and
clear of liens, claims and interests.
The material terms of the Agreement are:
a. Property: The sale of the Property represents a sale
of substantially all the assets of the estate as contemplated by
the Plan. The sale includes the personal property of the estate
located at Suite G of the Property.
b. Leases: The sale of the Property includes the
assignment of each lease of one or more suites of the Property.
c. No Contingencies: Subject only to obtaining Bankruptcy
Court approval of the sale, the Buyer acknowledges that there are
no contingencies to the closing of the sale of the Property under
the Agreement.
d. No Broker Commissions: The Debtor is not represented
by a real estate broker. The Seller will pay directly to its real
estate broker any commission for the sale and purchase of the
Property. No real estate broker's commission will be paid through
the escrow established for the sale of the Property.
e. Purchase Price: The purchase price of $5,400,000 is to
be paid by the Buyer to Reorganized Debtor as follows:
i. Good Faith Deposit: The Buyer provided
Reorganized Debtor with a good faith deposit in the amount of
$100,000. The Good Faith Deposit was deposited in the client trust
account of counsel for the Reorganized Debtor until the sale of the
Property is approved by the Bankruptcy Court.
ii. Cash at Closing: The Buyer will pay
Reorganized Debtor $5,300,00 at the Closing.
f. Free and Clear of Liens: The sale will be free and
clear of all liens, claims and encumbrances, as defined by the
Agreement.
g. "As Is" Sale: The sale of the Property is "as, is"
without any warranties, expressed or implied, being given by the
Reorganized Debtor.
h. Bankruptcy Court Approval: The sale is subject to
entry of an order by the U.S. Bankruptcy Court authorizing the
Reorganized Debtor to sell the Property.
i. Overbidding/Auction: The sale is subject to higher and
better bids submitted at the auction to be held concurrently with
the hearing to approve the proposed sale of the Property.
j. Bidding Procedures: The Agreement provides for
specified bidding procedures and bid protection provisions.
k. Closing: The Agreement provides for the closing of the
sale within 15 days after entry of the order authorizing the Debtor
to sell the Property, or such earlier date as agreed by the parties
in writing, subject to any applicable stay. The time for closing
the sale may also be extended by written agreement signed by all
parties.
The Reorganized Debtor asks authority to assign the Assumed Leases
to the Buyer. The Court entered the Order Establishing Bidding
Procedures For Sale Of Real And Personal Property Of The
Reorganized Debtor And Setting Hearing For Motion For Order
Authorizing Sale And Auction on Dec. 30, 2016.
The salient terms of the Bidding Procedures are:
a. All Cash Overbids: The initial overbid, if any, must
be $5,500,000. Each successive overbid must be at least an
additional $50,000.
b. Bid Deposit: $100,000
c. Auction: Feb. 14,2017 at 1:30 p.m., before the
Honorable Scott C. Clarkson, U.S. Bankruptcy Judge, in courtroom
126, 3420 Twelfth street, Riverside, California.
d. Minimum Overbid: $100,000
e. Determination of Highest Bid: The Reorganized Debtor
will decide which bid made at the Auction is the highest and best
bid for the Property with any disagreement to be resolved by the
Court.
f. Deadline to Close Sale of Property: The winning
bidder will have until the date which is 15 days after the entry of
the order approving the sale to consummate the sale.
A copy of the Agreement and the Bidding Procedures attached to the
Motion is available for free at:
http://bankrupt.com/misc/SJ_Medical_253_Sales.pdf
If Reorganized Debtor consummates a sale of the Property to a
person or entity other than the Buyer, Reorganized Debtor will pay
the Buyer at the closing of the transaction a break-up fee of
$20,000 to cover its due diligence expenses including legal fees,
appraisal fees, inspection fees, interest on its Good Faith Deposit
and related costs incurred by the Buyer.
First American Title Co. prepared a Preliminary Report dated Dec.
9, 2016 in advance of issuing a title policy for the sale of the
Property.
The Preliminary Report lists two recorded liens of monetary
obligations related to the Property:
a. General and special taxes for the fiscal year
2016-2017 (real property taxes). The first installment of $31,646
was paid and the second installment of $31,646, which is not yet
due, will be prorated between the Reorganized Debtor and the Buyer
at the closing of the sale of the Property.
b. Deed of Trust to secure an original indebtedness of
$4,410,000 to PFF Bank & Trust recorded June 7, 2016 as Instrument
No. 06-411378 of Official Records that was assigned to U.S. Bank
N.A. by assignment recorded Feb. 3, 2010 as Instrument No. 10-51537
of Official Records, as modified by document recorded April 19,
2012 as Instrument No. 12-177459 of Official Records. The
Reorganized Debtor requests authority to disburse funds from the
sale proceeds to pay this secured claim in full.
The Plan provides that the proceeds of the sale of the Property
will be sufficient to pay in full the Allowed Claims of these
non-insider classes of creditors:
a. Administrative Claims: The only administrative claim
of the Reorganized Debtor held by former general insolvency
counsel, Goe & Forsythe, LLP. The balance of the Goe & Forsythe
administrative claim as of Jan. 1, 2017, is approximately $59,012
and will be paid in full.
b. Class 3 U.S. Bank Secured Claim: The secured claim of
U.S. Bank in the estimated amount of $4,834,993 as of Dec. 30,
2016, will be paid in full from the proceeds of the sale of the
Property.
c. Class 4 General Unsecured Claims (Non-insider): The
allowed general unsecured claim of Alfred Santos for $400,000 will
be paid in full from the proceeds of the sale of the Property.
There are no other allowed general unsecured claims in the case.
d. Class 7 Tenant Security Deposit: The tenant deposits
of approximately $55,893 as of Jan. 1, 2017, will be given to Buyer
as a credit to the cash required of Buyer at the closing of the
sale of the Property.
The Reorganized Debtor asks that the Court authorize the sale of
the Property and the payment of the claims described through escrow
from the sale proceeds.
The Reorganized Debtor will pay these expenses of post-confirmation
administration before entry of a final decree in the case:
a. Quarterly Fees: The quarterly fees of the Reorganized
Debtor for the first quarter of 2017 will be $13,000. The estimate
is based on the distribution of $5,400,000 in sale proceeds during
the first quarter. The quarterly fee schedule published by the
U.S. Department of Justice provides for a fee of $13,000 for total
quarterly disbursements by debtors in chapter 11 cases of between
$5,000,000 and 515,000,000. The quarterly fees owed to the United
States Trustee will be paid prior to the entry of a final decree in
the case.
b. Post-confirmation professional fees and costs: The
Reorganized Debtor will pay expenses in the ordinary course of
business during the first quarter, including professional fees and
costs incurred to obtain approval of the proposed sale of the
Property, entry of related orders, and requesting entry of a final
decree.
The Reorganized Debtor anticipates that the proceeds of the sale of
the Property will not be sufficient to pay these classes of
creditors and interest holders:
a. Class 5 Insider Unsecured Claims: There will be no
payments to the holders of the Class 5 claims of members for loans
made to the Reorganized Debtor.
b. Class 6 Interests of Debtor: There will be no payments
to the holders of Class 6 Interests, however, the Plan provides for
the members of the Debtor to retain their interests in the Debtor
subject to claims each member may have against the other.
The Reorganized Debtor is a California Limited Liability Company.
All capital gains, losses and other tax consequences from the sale
of the Property will be reported in the individual income tax
returns of the members of the corporate entity. All tax
consequences of the sale of the Property, if any, other than the
proration of real property taxes in the escrow at the closing of
the sale, will be paid by the individual members who hold interests
in the Reorganized Debtor.
The Plan provides that April 1, 2017 is the deadline for closing
the sale. If the Property is not sold by that deadline, the
secured creditor, U.S. Bank, is authorized to proceed to foreclose
its first priority security interest in the Property. The sale of
the Property to the Buyer as proposed implements the terms of the
Plan and prevents the liquidation of the Property solely for the
benefit of the secured creditor. For these reasons, the Debtor
asserts that the sale of the Property to the Buyer is supported by
sound business judgment. Accordingly, the Reorganized Debtor asks
the Court to approve the sale of the Property to the Buyer free and
clear of any interest which sale proceeds are sufficient to pay the
costs required to close the sale and all non-insider Allowed
Claims. To implement the terms of the Plan, the Reorganized Debtor
asks authority to disburse the sale proceeds through escrow to pay
in full the costs, expenses, and Allowed Claim described.
The Reorganized Debtor must close the sale expeditiously to meet
the April 1, 2017 deadline set by the Forbearance Agreement and the
Plan. Waiver of the 14-day stay under Rule 6004(h), allows the
Reorganized Debtor to close the sale, implement the Plan, and
proceed to request entry of a Final Decree. The Reorganized Debtor
asks that the Court exercise its discretion and order that the sale
of the Property and the assignment of the Assumed Leases may be
effectuated immediately upon entry of the Sale Order.
The Purchaser can be reached at:
ALFRED AND BARBARA SANTOS TRUST
3114 Payne Ranch Rd.
Chino Hills, CA
Telephone: (562) 254-3733
Counsel for the Reorganized Debtor:
Pamela J. Zylstra, Esq.
18111 Von Karman, Suite 460
Irvine, CA 92612
Telephone: (949) 222-2000
Facsimile: (949) 222-2022
E-mail: zylstralaw@gmail.com
About S. J. Medical
S. J. Medical, LLC sought chapter 11 protection (Bankr. C.D. Ca.
Case No. 13-25500) on Sept. 16, 2013. The case is assigned to
Judge Scott C. Clarkson.
The Debtor has an estimated asset of $7,260,818 and $4,942,000 in
debt.
The Debtor tapped Marc C. Forsythe, Esq., at Goe & Forsythe, LLP as
counsel.
The petition was signed by Richard J. Anthony, member.
SAEXPLORATION HOLDINGS: Appoints Independent Director to Board
--------------------------------------------------------------
SAExploration Holdings, Inc., announced that Michael J. Faust has
been appointed to serve on its board of directors. SAE further
announced, that as a result of the election of Mr. Faust, his
appointment to serve on the Company's audit committee, and the
board of directors' determination that he is an independent
director, it has received formal notification from the Listing
Qualifications Department of The Nasdaq Stock Market that the
company has regained full compliance with the audit committee
requirement for continued listing on Nasdaq.
Michael Faust has 34 years of industry, financial and leadership
experience within the oil and gas sector, including diverse
geological, geophysical and technical reservoir experience spanning
many different basins and formations throughout the world. Prior
to joining SAE's board, Mr. Faust was the vice president of
Exploration and Land at ConocoPhillips Alaska, Inc., where he
oversaw and managed the Company's exploration organization and
strategy in Alaska. After joining Arco Alaska, Inc. in 1997, Mr.
Faust held multiple senior positions up to and following Phillips
Petroleum Co.'s acquisition of Arco Alaska, Inc. in 2000 and the
subsequent merger between Phillips and Conoco Inc., which created
ConocoPhillips Alaska, Inc. in 2002. These positions of increasing
responsibility included chief geophysicist, development geoscience
manager, technology and operations manager, and offshore
exploration manager, among others. In 2008, Mr. Faust was
appointed vice president of Exploration and Land at ConocoPhillips
Canada Ltd. Prior to Arco Alaska, Inc., Mr. Faust also held
various positions with Exxon Exploration Company and Esso Norge
A.S. after beginning his career with Exxon Co. USA in 1983. Mr.
Faust earned his Master of Arts degree in Geophysics from the
University of Texas at Austin in 1984, after receiving his Bachelor
of Science degree in Geology from the University of Washington in
1981. Mr. Faust is a Certified Petroleum Geologist and a member of
the American Association of Petroleum Geologists, the Society of
Exploration Geophysicists, and served as the President of the
Geophysical Society of Alaska from 2001 to 2002.
On Aug. 3, 2016, Nasdaq staff notified the Company that its common
stock had failed to meet the audit committee requirements under
Listing Rule 5605(c)(2). At the time, SAE had only two directors
that satisfied the independence requirement of that rule. However,
following the appointment of Mr. Faust to the Company's board of
directors, his appointment to serve on the Company's audit
committee, and determination that he was an independent director,
SAE now has three independent directors that serve on its audit
committee. SAE has submitted to Nasdaq documentation, including
biographies and other information, evidencing compliance with the
rule. As a result, Nasdaq staff has determined that the company
now meets the audit committee composition and independence
requirements. Accordingly, the Company has regained compliance
with Listing Rule 5605(c)(2) and this matter is now closed. SAE is
no longer deficient on any of the requirements under its listing
standard with Nasdaq.
About SAExploration Holdings, Inc.
SAExploration Holdings, Inc. (NASDAQ: SAEX) and its subsidiaries
are internationally-focused oilfield services company offering a
full range of vertically-integrated seismic data acquisition and
logistical support services in Alaska, Canada, South America, and
Southeast Asia to its customers in the oil and natural gas
industry. In addition to the acquisition of 2D, 3D, time-lapse 4D
and multi-component seismic data on land, in transition zones
between land and water, and offshore in depths reaching 3,000
meters, the Company offers a full-suite of logistical support and
in-field data processing services. The Company operates crews
around the world that are supported by over 29,500 owned land and
marine channels of seismic data acquisition equipment and other
leased equipment as needed to complete particular projects.
SAExploration reported a net loss attributable to the Corporation
of $9.87 million in 2015 following a net loss attributable to the
Corporation of $41.8 million in 2014. As of Sept. 30, 2016,
SAExploration had $214.41 million in total assets, $153.51 million
in total liabilities and $60.90 million in total stockholders'
equity.
* * *
In June 2016, S&P Global Ratings lowered its corporate credit
rating on SAExploration Holdings to 'CC' from 'CCC-'. The outlook
remains negative. The downgrade follows SAExploration's
announcement that it plans to launch an exchange offer to existing
holders of its 10% senior secured notes for shares of common equity
and a new issue of second-lien notes.
In September 2016, Moody's Investors Service withdrew
SAExploration's 'Caa2' Corporate Family Rating and other ratings.
SAM BASS: Has Interim Authority to Use Cash Collateral Until Feb. 7
-------------------------------------------------------------------
Judge Catherine R. Aron of the U.S. Bankruptcy Court for the Middle
District of North Carolina authorized Sam Bass Illustration &
Design, Inc., to use cash collateral on an interim basis, through
and including February 7, 2017.
The Debtor contended that the Internal Revenue Service and the
North Carolina Department of Revenue have an interest in the cash
collateral.
Judge Aron acknowledged that the Debtor is entitled to use the cash
collateral for its ordinary and reasonable operating expenses, as
set forth in the budget. The approved budget provides total
operating expenses of $23,118 for the period from January through
February 7, 2017.
The Debtor was directed to make monthly adequate protection
payments to the IRS and NCDOR in the amount of $277.37 each. As
further adequate protection, the IRS and the NCDOR were granted
continuing and replacement post-petition liens in all property and
categories of property in which, and of the same priority as said
creditor held a similar, unavoidable lien as of the petition date,
and the proceeds thereof.
The Debtor was directed to provide physical access to its property
to the representatives, agents and/or employees of the IRS and
NCDOR for the purpose of appraising or evaluating its collateral.
The Debtor was also directed to provide to all creditors and the
Bankruptcy Administrator a budget to actual report, reflecting the
actual income received and the expenses incurred during the
previous month compared to the budget.
A further interim hearing will be held on Feb. 7, 2017 at 2:00
p.m.
A full-text copy of the Fourth Interim Order, dated Jan. 17, 2017,
is available at https://is.gd/q0D6Wu
About Sam Bass Illustration & Design
Sam Bass Illustration & Design, Inc., filed a chapter 11 petition
(Bankr. M.D.N.C. Case No. 16-51021) on Oct. 3, 2016. The petition
was signed by Denise W. Bass, co-owner and secretary/treasurer.
The Debtor estimated assets at $0 to $50,000 and liabilities at
$100,001 to $500,000 at the time of the filing.
No Official Committee of Unsecured Creditors has been appointed in
the Chapter 11 case.
The Debtor is represented by attorney Kristen Scott Nardone, Esq.,
at Davis Nardone, PC. The Debtor engaged Gordon, Keeter & Co. as
accountant.
SAN JOSE CONTRACTING: Taps Campbell & Coombs as Legal Counsel
-------------------------------------------------------------
San Jose Contracting, Inc. seeks approval from the U.S. Bankruptcy
Court for the District of Arizona to hire legal counsel in
connection with its Chapter 11 case.
The Debtor proposes to hire Campbell & Coombs, P.C. to give legal
advice regarding its duties under the Bankruptcy Code, assist in
resolving post-petition financing issues, prepare a bankruptcy
plan, and provide other legal services.
Harold Campbell, Esq., and Scott Coombs, Esq., the attorneys
expected to represent the Debtor, will be paid an hourly rate of
$500. The rates for other attorneys range from $300 to $400 per
hour. Meanwhile, paralegals and law clerks will be paid $85 per
hour.
Campbell & Coombs does not represent any interest adverse to the
Debtor or its bankruptcy estate, according to court filings.
The firm can be reached through:
Harold E. Campbell, Esq.
Vincent R. Mayr, Esq.
Campbell & Coombs, P.C.
1811 S. Alma School Road, Suite 225
Mesa, Arizona 85210
Phone: (480) 839-4828
Fax: (480) 897-1461
Email: heciii@haroldcampbell.com
Email: vincent@haroldcampbell.com
About San Jose Contracting
San Jose Contracting, Inc. sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. D. Ariz. Case No. 17-00433) on January
17, 2017. The petition was signed by Lowell J. Gulley, president.
The case is assigned to Judge Brenda K. Martin.
At the time of the filing, the Debtor estimated assets of less than
$500,000 and liabilities of $1 million to $10 million.
SANJECK LLP: Asks For Court's Conditional Approval of Plan Outline
------------------------------------------------------------------
Sanjeck LLP has asked the U.S. Bankruptcy Court for the Northern
District of Texas to conditionally approve its disclosure statement
dated Jan. 11, 2017, referring to the Debtor's plan of
reorganization.
As reported by the Troubled Company Reporter on Jan. 19, 2017, the
Debtor filed with the Court a disclosure statement dated Jan. 11,
2017, referring to the Debtor's plan of reorganization. Under that
Plan, Class 4 Allowed Secured Claim of the Propel Financial
Services -- estimated at $83,917.88 -- will be paid in full from
the continued operations of the Reorganized Debtor over 84 months
with interest on the allowed claims at the rate of 10% per annum.
Payments will commence on the first day of the month following the
Effective Date. This class is impaired.
About Sanjeck LLP
Sanjeck LLP owns and operates a strip-shopping center located in
Mesquite, Texas.
The Debtor filed a Chapter 11 petition (Bankr. N.D. Tex. Case No.
16-32818) on July 15, 2016. The petition was signed by Joel Nwoke,
limited partner. The case is assigned to Judge Stacey G. Jernigan.
The Debtor's counsel is Joyce W. Lindauer, Esq., of Joyce W.
Lindauer Attorney, PLLC. The Debtor disclosed $1.66 million in
assets and $1.29 million in liabilities.
SECURED ASSETS: Millennial Living Buying Reno Property for $338K
----------------------------------------------------------------
Secured Assets Belvedere Tower, LLC, asks the U.S. Bankruptcy Court
for the District of Nevada to authorize the sale of three
condominium units – Unit 512, Unit 606 and Unit 908 – located
within The Belvedere, 450 N. Arlington Ave., Reno, Nevada, to is
Millennial Living, LLC for $337,500, subject to overbid.
A hearing on the Motion is set for Feb. 14, 2017 at 2:00 p.m.
On Sept. 8, 2016, the Debtor signed a renewal of a six month
Exclusive Right to Sell Contract ("Listing Agreement") with Mandie
Jensen of Dickson Realty, Inc. for the sale of its condominium
units at the Property. As set forth in the Application to Employ,
the Listing Agreement provides, subject to the Court's approval,
for a commission of 3% of the gross sales price of each Unit to be
paid to Dickson Realty, due and payable only upon the closing of an
approved sale.
On Jan. 11, 2017, the Debtor finalized an agreement to sell Unit
512, APN 007-463-28, to the Proposed Buyer for $125,000, with
$4,314 to be contributed by the Debtor towards the Buyer's closing
costs and/or HOA dues.
The Unit 512 Purchase Agreement outlines these additional terms:
a. The offer is an all cash offer that is not contingent
on an appraisal;
b. The Debtor will pay for title insurance and transfer
taxes and the Debtor and the Proposed Buyer will share equally in
escrow costs;
c. The Proposed Buyer has waived all inspections; and
d. The Debtor will pay both the existing HOA assessments
levied, specifically in the amount of $2,395, and the HOA set-up
fees and assessments levied but not yet due.
On Jan. 12, 2017, the Debtor finalized an agreement to sell Unit
606, APN 007-464-06, to the Proposed Buyer for $127,500 with $5,000
to be applied towards the Proposed Buyer's recurring and
non-recurring closing costs.
The Unit 606 Purchase Agreement outlines these additional terms:
a. The offer is an all cash offer that is not contingent
on an appraisal;
b. The Debtor will pay for title insurance and the Debtor
and the Proposed Buyer will share equally in escrow costs and
transfer taxes;
c. The Proposed Buyer has waived all inspections with the
exception of a home inspection, which will be paid for by the
Buyer, and has the right to inspect the property within 5 days
after court approval; and
d. The Debtor will pay existing HOA assessments levied,
specifically in the amount of $2,386 and the Proposed Buyer will
pay all HOA assessments levied but not yet due.
On Jan. 12, 2017, the Debtor finalized an agreement to sell Unit
908, APN 007-465-24, to the Proposed Buyer for $85,000 with $5,000
to be applied towards the Proposed Buyer's recurring and
non-recurring closing costs.
The Unit 908 Purchase Agreement outlines the following additional
terms:
a. The offer is an all cash offer that is not contingent
on an appraisal;
b. The Debtor will pay for title insurance and transfer
taxes and the Debtor and the Proposed Buyer will share equally in
escrow costs;
c. The Proposed Buyer has waived all inspections with the
exception of a home inspection, which will be paid for by the
Buyer, and has the right to inspect the property within 5 days
after court approval; and
d. The Debtor will pay existing HOA assessments levied,
specifically in the amount of $1,131 and the Proposed Buyer will
pay all HOA assessments levied but not yet due.
All three Purchase Agreements share these provisions:
a. The Debtor will pay for a home warranty contract in
the amount of $220 and will pay for and complete repairs in an
amount not to exceed $500.
b. The Proposed Buyer will make an Earnest Money Deposit
and provide proof of funds.
c. The Debtor and the Proposed Buyer will share equally
in all HOA transfer and set up fees and the .5% capital
contribution fee.
d. The sale is subject to (i) Court approval and (ii)
possible overbid pursuant to bidding procedures as set forth in the
Sale Motion and will close as soon as possible after Court
approval.
e. A commission of 6% of the total purchase price shall
be paid and split between the seller's and the buyer's agents.
f. The deposit amounts will be applied towards the
purchase price upon Court approval of the sale. In the event that
the Proposed Buyer is approved as the purchaser at the Sale Hearing
but fails to close the transaction, the deposit will not be
returned and will become property of the bankruptcy estate, and the
Proposed Buyer will have no claims against the estate or its
assets. The deposit is refundable in the event the Proposed Buyer
is overbid or the Court denies the sale.
A copy of the Agreements attached to the Motion is available for
free at:
http://bankrupt.com/misc/Secured_Assets_243_Sales.pdf
BDH has a first priority security interest in all three units. By
virtue of a recorded Judgment by Confession, Woodburn & Wedge has a
second priority security interest in all three units based on past
due attorneys' fees.
Any person may qualify as a "Qualified Bidder." To do so, an
interested bidder must deliver to Ms. Jensen a loan commitment
letter in form, on terms, and from a lender satisfactory to the
Debtor sufficient to pay the balance of purchase price for property
or produce a certification from a bank or similar financial
institution of available funds to close in form satisfactory to the
Debtor sufficient to close the sale.
A hearing will be conducted on Feb. 14, 2017 at 2:00 p.m. A party
must be a Qualified Bidder to bid at the Sale Hearing.
The Proposed Buyer's offering price for each unit will be the
opening bid on that unit. Any sale is to be approved for an amount
not less than the offer on the particular unit.
The initial overbid increment will be at least $2,000, resulting
in a minimum sale price of $2,000 over the contract price or
comparable offer. Subsequent bids will be accepted in increments
of $1,000. The final purchase price will be the highest qualified
bid offered over the Opening Bid Price and accepted at hearing.
The Closing will take place as soon as possible after the Court's
order is entered approving the Sale Motion, including paying the
balance of the purchase price and executing all necessary
documents, but in any event, no more than 7 days after the Order is
entered. Failure to close timely will constitute a material breach
of the Purchase Agreement, shall void any rights the Proposed Buyer
or a successful Bidder may have had against the bankruptcy estate
or any of its assets, including against the Property, and will
permit the Debtor to re-market the Property and sell it to a third
party.
The the Debtor respectfully submits that it has adequately
articulated a business justification and that the sale is in the
best interests of the estate and its creditors.
Accordingly, the Debtor asks that the Court approve the sales free
and clear of all liens, claims and encumbrances, with liens to
attach to the proceeds of sale in order of priority, which proceeds
will be set aside in the Debtor's counsel's client trust account
until further order of the Court. The Debtor also asks the Court
to authorize that Dickson Realty, Inc. may be paid a commission of
3% of the gross sales price directly from escrow without the
necessity of filing a separate fee application and that other
customary and ordinary costs of sale of the unit may be paid upon
successful closing.
The Debtor asks the Court to order that the proposed sale is not
stayed pursuant to Fed. R. Bankr. Pro. 6004(h). Although the
Proposed Buyer consented to a hearing on regular time, its
preference was to close immediately.
About Secured Assets Belvedere Tower
Reno, Nevada-based Secured Assets Belvedere Tower, LLC, filed a
chapter 11 petition (Bankr. D. Nev. Case No. 16-51162) on Sept. 19,
2016. The petition was signed by Gregg Smith. The Debtor is
represented by Elizabeth A. High, Esq., and Cecilia Lee, Esq., at
Davis Graham & Stubbs LLP. The case is assigned to Judge Gregg W.
Zive.
The Debtor, a single asset real estate company, disclosed total
assets at $20.4 million and total liabilities at $18.5 million.
SILVER CREEK: Can Use DeSoto Cash Collateral on Interim Basis
-------------------------------------------------------------
Judge Harlin DeWayne Hale of the U.S. Bankruptcy Court for the
Northern District of Texas authorized Silver Creek Investments,
LLC, to use cash collateral on an interim basis.
Judge Hale acknowledged the necessity of the Debtor's immediate
need to use Cash collateral in order to continue its ordinary
course of business operations and to maintain the value of its
bankruptcy estate, to avoid immediate and irreparable harm to the
Debtor's bankruptcy estate.
The Debtor is authorized to collect Cash Collateral in the form of
rent from tenants at the Property for the month of January 2017.
The Debtor's use of cash collateral will be limited to payment of
certain expenses of operating its business, including payroll and
related taxes, and the monthly secured obligation to Bank of DeSoto
pursuant to its security documents. Particularly, the Debtor was
allowed following operating expense payment:
Employee/Contractor Compensation $1,750
Utilities $ 795
Office Expenses and supplies $ 175
Repairs and Maintenance $2,725
Management fee to Alfred Herron $1,000
In addition, the Debtor is required to timely pay all fees and
charges to the U.S. Trustee that are required under Chapter 123 of
title 28.
The Debtor is directed to provide written documentation for each
operating expense paid with the Cash Collateral, and to deposit in
the Debtor's Debtor-in-Possession account any Cash Collateral
collected in excess of the amount required to pay operating
expenses until further order of the Court.
The Debtor is also directed to make adequate protection payments in
the amount of $20,250 each month to Bank of DeSoto, beginning
January 1, 2017 and will continue until further order of the Court.
The Debtor is further directed to provide Bank of DeSoto, with an
updated rent roll that will show the name, address with suite
number and amount of rent to be paid each month, no later than
January 6, 2017, as well as an accounting of all income generated
from the Event Center located at the Property for the period of
January 2016 through December 2016.
A final hearing on the Motion is scheduled before the Court on Jan.
24, 2017 at 1:45 p.m.
A full-text copy of the Agreed Interim Order, dated Jan. 10, 2017,
is available at http://bankrupt.com/misc/txnb16-34633-30.pdf
About Silver Creek Investments
Silver Creek Investments, LLC, filed a Chapter 11 petition (Bankr.
N.D. Tex. Case No. 16-34633) on Dec. 3, 2016. The petition was
signed by Alfred Herron, managing member. The case is assigned to
Judge Barbara J. Houser. The Debtor is represented by Marilyn D.
Garner, Esq. at the Law Office of Marilyn D. Garner, PLLC. At the
time of filing, the Debtor had both assets and liabilities
estimated at $1 million to $10 million each.
SOLERA HOLDINGS: S&P Lowers CCR to 'B-' on High Leverage
--------------------------------------------------------
S&P Global Ratings said it lowered its corporate credit rating on
Westlake, Texas-based Solera Holdings Inc. to 'B-' from 'B'. The
outlook is stable.
S&P also lowered its issue-level ratings on the company's secured
credit facilities to 'B' from 'B+'. The recovery rating remains
'2', indicating S&P's expectation for substantial (70% to 90%;
lower half of the range) recovery in the event of a payment
default. Additionally, S&P lowered its issue-level rating on the
company's unsecured notes to 'CCC+' from 'B-'. The recovery rating
remains '5', indicating S&P's expectation for modest (10% to 30%;
lower half of the range) recovery in the event of a payment
default.
"Our downgrade of Solera to 'B-' from 'B' reflects the company's
leverage remaining elevated at around 10x (including $1.1 billion
of preferred equity and $223 million of stockholder appraisal
rights as debt), pro forma for the acquisition of Autodata, and it
successfully achieving previously identified cost savings," said
S&P Global Ratings credit analyst Andrew Yee.
The proposed acquisition will be Solera's second debt-financed
acquisition since it was acquired by a consortium led by Vista
Equity Partners in March 2016. While S&P expects the company to
achieve organic growth in the low- to mid-single-digit percentage
area over the next 12 months, S&P believes pro forma leverage will
decline to the mid-9x area and FOCF-to-debt ratio will be low at
around 2.5%.
The rating on Solera reflects its leading market position as a
provider of risk and asset management software and services to the
automotive and property markets, including the global property and
casualty insurance industry, its recurring and predictable revenue
base, and its proprietary auto-market analytical data. The company
is geographically diversified and derives about 57% of its revenue
from the Americas and the remaining 43% from Europe, the Middle
East, and Africa as of June 30, 2016. The company also benefits
from fairly diverse customer segments, led by insurance providers
and trailed by collision, recyclers, and service, maintenance and
repair (SMR) facilities. The company's niche product focus within
the automotive property and casualty industry, acquisitive growth
strategy, and high tolerance for debt leverage offset these
strengths.
The stable outlook reflects S&P's expectation of low- to
mid-single-digit percentage organic revenue growth over the next 12
months and the company successfully achieving the previously
identified cost savings. However, S&P expects pro forma leverage
to remain high and FOCF to debt ratio of about 2.5%.
SPANISH BROADCASTING: Begins Trading on OTCQX
---------------------------------------------
Spanish Broadcasting System, Inc., announced that its shares of
common stock began trading on the OTCQX Best Market, effective
today, Jan. 19, 2017. The shares are trading on the OTCQX under
the symbol "SBSAA".
On Jan. 17, 2017, the Company received a letter from The NASDAQ
Stock Market LLC notifying the Company that based upon the
Company's continued non-compliance with the NASDAQ rule requiring
that the minimum market value of its common stock exceed $15
million, the Company's securities would be suspended from NASDAQ
effective with the open of business on Jan. 19, 2017, pending
ultimate delisting.
The Company will continue to file periodic and other required
reports with the Securities and Exchange Commission under
applicable federal securities laws.
Investors can find current financial disclosure and Real-Time Level
2 quotes for the Company on http://www.otcmarkets.com/
As announced on Jan. 28, 2016, Spanish Broadcasting received a
written notice from The Nasdaq Stock Market, advising the Company
that the market value of its Class A common stock for the previous
30 consecutive business days had been below the minimum $15,000,000
required for continued listing on the NASDAQ Global Market pursuant
to NASDAQ Listing Rule 5450(b)(3)(C).
The Notice also stated that pursuant to NASDAQ Listing Rule
5810(c)(3)(D), the Company would be provided an initial grace
period of 180 calendar days, or until July 26, 2016, to regain
compliance with the Rule. The Company did not regain compliance
with the Rule by July 26, 2016. Accordingly, on July 27, 2016, the
Company received written notification from NASDAQ that unless the
Company requested a hearing before the NASDAQ Hearings Panel the
Company's common stock would be delisted.
The Company requested a hearing before the NASDAQ Hearings Panel to
appeal the Staff Determination, which occurred on Sept. 8, 2016.
On Sept. 17, 2016, the Company received written notification from
NASDAQ, dated Sept. 12, 2016, granting the Company's request to
continue the listing of its shares on the NASDAQ Global Market
until Jan. 23, 2017. NASDAQ required that, during this exception
period, the Company provide prompt notification of any significant
events that occurred during this time which called into question
the Company's ability to demonstrate compliance with the Rule.
In January 2017, the Company determined that it was not likely to
regain compliance with the Rule by Jan. 23, 2017, and notified
NASDAQ of its determination on Jan. 13, 2017.
About Spanish Broadcasting
Headquartered in Coconut Grove, Florida, Spanish Broadcasting
System, Inc. (OTCQX:SBSAA) -- http://www.spanishbroadcasting.com/
-- owns and operates 21 radio stations targeting the Hispanic
audience. The Company also owns and operates Mega TV, a television
operation with over-the-air, cable and satellite distribution and
affiliates throughout the U.S. and Puerto Rico. Its revenue for
the twelve months ended Sept. 30, 2010, was approximately $140
million.
As of Sept. 30, 2016, Spanish Broadcasting had $451.7 million in
total assets, $569.4 million in total liabilities and a total
stockholders' deficit of $117.7 million.
* * *
As reported by the TCR on Feb. 1, 2016, Moody's Investors Service
downgraded Spanish Broadcasting System's Corporate Family Rating to
'Caa2' from 'Caa1', Probability of Default Rating to 'Caa3-PD' from
'Caa1-PD', and lowered its Speculative Grade Liquidity Rating to
SGL-4 from SGL-3. Spanish Broadcasting's 'Caa2' Corporate Family
Rating and Caa3-PD Probability of Default Rating reflect very high
debt+preferred stock-to-EBITDA of 10.4x estimated for LTM December
2015 (including Moody's standard adjustments, 6.9x excluding
preferred stock and accrued dividends), the need to address the
Voting Rights Triggering Event, and the heightened potential of a
payment default given the near term maturity of the 12.5% senior
secured notes due April 2017.
As reported by the TCR on June 21, 2016, S&P Global Ratings said it
lowered its corporate credit rating on Spanish Broadcasting System
to 'CCC' from 'CCC+'.
SPECTRASCIENCE INC: Withdraws Tender Offer for Warrants
-------------------------------------------------------
Lowell W. Giffhorn, CFO of SpectraScience, Inc., informed the
Securities and Exchange Commission that the Company has decided not
to proceed with the tender offer filed with the Securities and
Exchange Commission on Form TO on Aug. 19, 2016.
The Tender Offer Statement on Schedule TO relates to the Company's
offer to exchange certain of its outstanding warrants for (i) the
issuance of restricted shares of its common stock, $0.01 par value
per share in exchange for the cancellation of the Eligible Warrants
at various conversion rates based on the existing exercise price of
the Eligible Warrant per the Offer to Exchange and the Election
Form, which together, as each may be amended and supplemented from
time to time, constitute the Offer. A copy of the Schedule TO is
available at https://is.gd/msiMqO
Early this month, SpectraScience filed with the SEC a copy of an
Information Statement, which is being furnished to the Company's
stockholders of record in connection with the authorization of the
corporate action by the Company's Board of Directors on January 10,
2017, and the approval of such corporate action by the written
consent, taken as of January 10, 2017, of those stockholders of
record of the Company entitled to vote the majority of the
aggregate shares of the Company's common stock, par value $0.01 per
share totaling 876,171,222 voting shares, and the holders of Series
AA Super Voting Stock outstanding on such date totaling
3,000,000,000 voting shares.
Stockholders holding in the aggregate 3,000,000,000 shares of
Common Stock and Series AA Super Voting Stock (77% of the voting
stock outstanding as of January 10, 2017) approved the corporate
action. Accordingly, the Information Statement is furnished solely
for the purpose of informing the stockholders of record of the
Company, in the manner required under the Securities Exchange Act
of 1934, as amended, of this corporate action before it takes
effect.
The Board and Consenting Shareholders have approved an Amendment to
the Company's Amended and Restated Articles of Incorporation to
increase the number of authorized shares of Capital Stock of the
Company to 2,000,000,000.
A copy of the Information Sheet is available at
https://is.gd/UbLgPB
About SpectraScience
SpectraScience, Inc., develops and manufactures innovative Laser
Induced Fluorescence spectrophotometry systems capable of
determining whether tissue is normal, pre-cancerous or cancerous
without removing tissue from the body. The WavSTAT Optical Biopsy
System is SpectraScience's first product to incorporate its
proprietary fluorescence technology for clinical use. The WavSTAT
System carries the CE mark designation which allows for the sale
and marketing in the European Union for the diagnosis of cancer.
* * *
The Company had $1,693,744 in total assets against $10,982,753 in
total current liabilities at Sept. 30, 2016. Total mezzanine
equity is $30,850 and accumulated deficit is $52,420,568 at Sept.
30, 2016.
Historically, the Company's sources of cash have come from the
issuance and sale of equity securities and debentures. The
Company's historical cash outflows have been primarily used for
operating activities including research, development,
administrative and sales activities. Fluctuations in the
Company's
working capital due to timing differences of its cash receipts and
cash disbursements also impact its cash flow. The Company expects
to incur significant additional operating losses through at least
the end of 2016, as it completes proof-of-concept trials, conducts
outcome-based clinical studies and increases sales and marketing
efforts to commercialize the WavSTAT4 System in Europe. If the
Company does not receive sufficient funding, there is substantial
doubt that the Company will be able to continue as a going
concern.
The Company may incur unknown expenses or may not be able to meet
its revenue forecast, and one or more of these circumstances would
require the Company to seek additional capital. The Company may
not be able to obtain equity capital or debt funding on terms that
are acceptable. Even if the Company receives additional funding,
such proceeds may not be sufficient to allow the Company to
sustain
operations until it becomes profitable and begins to generate
positive cash flows from operations.
As of September 30, 2016, the Company had a working capital
deficit
of $10,503,770 and cash of $1,927, compared to a working capital
deficit of $8,324,600 and cash of $127,493 as of December 31,
2015.
In December 2011, the Company entered into an Engagement Agreement
with Laidlaw & Company (UK) Ltd., which Engagement Agreement was
amended in July 2012. Under the Engagement Agreement, Laidlaw
agreed to assist the Company in raising up to $20.0 million in
capital over a two-year period from the date of the Engagement
Agreement. Subsequent to March 31, 2013, the Company has engaged
other agents to assist the Company with raising capital and has
commenced raising capital on its own. During the nine months ended
September 30, 2016, the Company raised $1,185,000, net of
transaction costs of $34,000, under these agreements. However, if
the Company does not receive additional funds in a timely manner,
the Company could be in jeopardy as a going concern. The Company
may not be able to find alternative capital or raise capital or
debt on terms that are acceptable. Management believes that if
the
events defined in the Engagement Agreements occur as expected, or
if the Company is otherwise able to raise a similar level of
funds,
such proceeds will be sufficient to allow the Company to sustain
operations until it attains profitability and positive cash flows
from operations. However, the Company may incur unknown expenses
or may not be able to meet its revenue expectations requiring it
to
seek additional capital. In such event, the Company may not be
able to find capital or raise capital or debt on terms that are
acceptable.
The holders of Convertible Debentures control the conversion of
the
Convertible Debentures and certain of the Convertible Debentures
were not converted at their maturity constituting a potential
default on the matured, but unconverted, Convertible Debentures.
In the event of such default, principal, accrued interest and
other
related costs are immediately due and payable in cash. As of
September 30, 2016, Convertible Debentures with a face value of
$5,473,032 held by 75 individual investors are in default. None
of
these investors have served notice of default on the Convertible
Debentures held by them.
SPENCER TRANSPORTATION: CCG Inc Wants to Stop Cash Use
------------------------------------------------------
Secured Lender Commercial Credit Group Inc. asks the U.S.
Bankruptcy Court for the Northern District of Alabama, to prohibit
Spencer Transportation, LLC from using cash collateral.
CCG Inc. requests the Court to prohibit the Debtor from using cash
collateral to the extent necessary to adequately protect its
interest in the cash collateral, and require the Debtor to provide
CCG Inc. replacement liens and monthly status of cash collateral
use and generation.
CCG Inc. relates that the Debtor executed in its favor four
Negotiable Promissory Notes and Security Agreements with various
monthly payment requirements, and the Notes are in default.
CCG Inc. asserts a valid, perfected, first priority purchase money
security interest in several specific personal property of the
Debtor. Pursuant to the security agreements, the Debtor granted to
CCG Inc. a blanket security interest in any and all accounts,
accounts receivable, equipment, fixtures, general intangibles,
inventory, securities, deposit accounts, investment property and
all other property in which the Debtor now or hereafter has any
right or interest, including rental proceeds, insurance proceeds,
accounts and chattel paper arising out of or related to the sale,
use, rental or other disposition thereof.
CCG Inc. contends that the Debtor has not requested nor received
permission to use its cash collateral and no budget for operating
the Debtor's business has been provided.
Commercial Credit Group Inc. is represented by:
Jesse S. Vogtle, Jr., Esq.
BALCH & BINGHAM LLP
P. O. Box 306
Birmingham, Alabama 35201
Tel: (205) 251-8100
About Spencer Transportation
Spencer Transportation, LLC, filed a Chapter 11 petition (Bankr.
N.D. Ala. Case No. 17-70012), on Jan. 4, 2017. The petition was
signed by its Manager, Dwayne F. Haney. At the time of filing, the
Debtor had less than $50,000 in estimated assets and $500,000 to $1
million in estimated liabilities. The Debtor is represented by Lee
R. Benton, Esq. at Benton & Centeno, LLP.
STENA AB: Bank Debt Trades at 8% Off
------------------------------------
Participations in a syndicated loan under Stena AB is a borrower
traded in the secondary market at 91.50 cents-on-the-dollar during
the week ended Friday, January 13, 2017, according to data compiled
by LSTA/Thomson Reuters MTM Pricing. This represents an increase
of 2.00 percentage points from the previous week. Stena AB pays
300 basis points above LIBOR to borrow under the $0.65 billion
facility. The bank loan matures on Feb. 20, 2021 and carries
Moody's Ba3 rating and Standard & Poor's BB rating. The loan is
one of the biggest gainers and losers among 247 widely quoted
syndicated loans with five or more bids in secondary trading for
the week ended January 13.
STRINGER FARMS: Can Continue Using Cash Collateral Until Feb. 10
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas
authorized Stringer Farms, Inc. and Charles Blake Stringer to use
cash collateral on an interim basis, through Feb. 10, 2017.
The Court authorized the Debtors to use cash collateral to pay the
costs of operation of its businesses, only in accordance with the
First Interim Budget and the Second Interim Budget.
The Second Interim Budget contemplates a four week operating
expenses from January 20, 2017 through February 10, 2017 in the
aggregate sum of $443,135. The Second Interim Budget includes
budgeted expenditures of $130,266 for the week ending February 10,
2017, of which amount, $125,266 is proposed to be paid by the
Debtor to two prepetition creditors on account of amounts owed for
prepetition work in harvesting the Debtors' corn crop.
Wells Fargo asserted that it possesses perfected security interests
in and liens on various personal property of the Debtors, including
but not limited to accounts, inventory, equipment, farm products,
including crops, livestock, poultry and all supplies used in the
Debtors' farming operations, to secure payment of the Debtors'
prepetition indebtedness. As of the Petition Date, the Debtor was
indebted to Wells Fargo, pursuant to, among other:
(a) First Promissory Note, in the original principal amount
of $2 million;
(b) Second Promissory Note, in the original principal amount
of $2.2 million;
(c) Third Promissory Note, in the original principal amount
of $5 million;
(d) certain WellsOne Commercial Card Agreement; and
(e) certain Commercial Guaranty.
Wells Fargo is granted a replacement security interest in, and
lien, upon the right, title and interest in the following property
of the Debtors:
(a) The prepetition Collateral of Wells Fargo;
(b) Any property acquired by the Debtors after the Petition
Date, which is of the same nature, kind and character as Wells
Fargo's prepetition collateral. Such replacement liens will have
the same priority, validity, force and effect as the liens that
they replace.
(c) A first lien and security interest, subject only to any
ad valorem taxes, in and to the Second Replacement Lien Real
Estate.
Accordingly, the Debtor Stringer will execute a Deed of Trust and
Security Agreement to document the lien on such real estate, which
lien will be release on the earlier of: (1) Wells Fargo being paid
back its secured claim in full, or (2) the Debtors obtain DIP
Financing that is sufficient to re-pay Wells Fargo for diminution
of the value of Wells Fargo's collateral resulting from the
Debtor's use of cash collateral. In addition, the Debtor Stringer
will also sign a homestead affidavit regarding his homestead.
The Debtors were directed to provide Wells Fargo: (a) report which
reflects actual income and expenditures during the prior week
compared to the income and expenditures projected in the Cash
Budget, and (b) screenshots reflecting balances in the
debtor-in-possession bank accounts.
As additional adequate protection to Wells Fargo, the Debtor agreed
to endeavor to use their best efforts to obtain DIP Financing from
a DIP Lender on or before February 10, 2017, and to present a
motion to the Court to incur such financing. The Debtors further
agreed to include in any DIP Financing Motion an agreement to pay
Wells Fargo back at least the amount of cash collateral consumed by
the Debtors.
The Debtors are also directed to maintain insurance on Wells
Fargo's prepetition and postpetition collateral.
Wells Fargo is also granted an administrative priority claim up to
the amount of the diminution and to the extent that the Replacement
liens and other adequate protection already provided by the Order
prove insufficient to secure any diminution in value of Wells
Fargo's interest in the Collateral.
A final hearing to consider the Debtors' authority to use cash
collateral will be held on February 7, 2017 at 9:30 a.m.
A full-text copy of the Second Agreed Interim Order, dated Jan. 12,
2017, is available at https://is.gd/HxO0Ef
About Stringer Farms, Inc.
Stringer Farms, Inc. filed a Chapter 11 petition (Bankr. N.D. Tex.
Case No. 16-44821), on December 14, 2016. The Petition was signed
by Charles Blake Stringer, president. The case is assigned to
Judge Russell F. Nelms. At the time of filing, the Debtor had $10
million to $50 million in estimated assets and $1 million to $10
million in estimated liabilities.
Charles Blake Stringer filed a voluntary Chapter 11 petition
(Bankr. N.D. Tex. Case No. 16-44871) on December 20, 2016.
Pursuant to an Order directing the Joint Administration of Cases
entered on December 23, 2016, the Debtors bankruptcy cases are
being jointly administered under (Bankr. N.D. Tex. Case No.
16-44821).
The Debtors are represented by Jeff P. Prostok, Esq., Forshey &
Prostok, LLP.
No creditors' committee has been appointed in the Debtors' cases by
the U.S. Trustee. Further, no trustee or examiner has been
requested or appointed in the Debtors' Chapter 11 cases.
SUNEDISON INC: Sale of 100% Interest in TerraForm for $42.5M Okayed
-------------------------------------------------------------------
Judge Stuart M. Bernstein of the U.S Bankruptcy Court of the
Southern District of New York authorized the private sale by
SunEdison, Inc. and Terraform Private Holdings, LLC of their 100%
of equity interests in TerraForm Private, LLC, to DIF INFRA 4 US,
LLC and DIF IV CO-INVEST, LLC for $42,500,000.
The Sale Hearing was held on Jan. 12, 2017.
The sale is free and clear of all interests, including without
limitation, Liens, Claims, and Liabilities.
The Buyer is not and will not be deemed a successor to the Seller
or any of the Releasing Parties as a result of the consummation of
the Transaction.
Any settlement or compromise contained within the Membership
Interest Purchase Agreement ("MIPA"), including any releases by the
Debtors, are approved under Bankruptcy Section 363(b) and
Bankruptcy Rule 9019.
The Buyer will not be required to seek or obtain relief from the
automatic stay under Bankruptcy Code section 362 to implement the
MIPA and consummate the Transaction contemplated therein and
enforce any of its remedies under the MIPA or any other
sale-related document, or to effectuate the releases granted by the
Releasing Parties. The automatic stay imposed by Bankruptcy Code
section 362 is modified solely to the extent necessary to implement
the preceding sentence, provided however that the Court will retain
exclusive jurisdiction over any and all disputes with respect
thereto.
The requirements set forth in Bankruptcy Rules 6003(b) and 6004
have been satisfied or otherwise deemed waived.
As provided by Bankruptcy Rules 7062 and 9014, the terms and
conditions of the Order will be effective and enforceable
immediately upon entry and will not be subject to the stay
provisions contained in Bankruptcy Rule 6004(h). Time is of the
essence in closing the sale, and the Seller and the Buyer intend to
close the sale as promptly as practicable following entry of the
Order.
Notwithstanding anything to the contrary contained, any
authorizations granted or proceeds obtained by the Seller pursuant
to the Transaction will be subject to any applicable requirements
imposed on the Debtors under the Final DIP Order [Docket No. 523],
the DIP Credit Agreement, and the other DIP Loan Documents,
including, for the avoidance of doubt, the requirement that all Net
Asset Sale Proceeds obtained by the Seller pursuant to the
Transaction will be deposited in the Collateral Proceeds Account
unless otherwise approved by the requisite Lenders.
About SunEdison, Inc.
SunEdison, Inc. (OTC PINK: SUNEQ), is a developer and seller of
photovoltaic energy solutions, an owner and operator of clean
power
generation assets, and a global leader in the development,
manufacture and sale of silicon wafers to the semiconductor
industry.
On April 21, 2016, SunEdison, Inc., and 25 of its affiliates each
filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case Nos.
16-10991 to 16-11017). Martin H. Truong, the senior vice
president, general counsel and secretary, signed the petitions.
The Debtors disclosed total assets of $20.7 billion and total debt
of $16.1 billion as of Sept. 30, 2015.
The Debtors have hired Skadden, Arps, Slate, Meagher & Flom LLP as
counsel, Togut, Segal & Segal LLP as conflicts counsel, Rothschild
Inc. as investment banker and financial advisor, McKinsey Recovery
& Transformation Services U.S., LLC, as restructuring advisors and
Prime Clerk LLC as claims and noticing agent. The Debtors
employed
PricewaterhouseCoopers LLP as financial advisors; and KPMG LLP as
their auditor and tax consultant.
SunEdison also has tapped Eversheds LLP as its special counsel for
Great Britain and the Middle East. Cohen & Gresser LLP has also
been retained as special counsel.
The Debtors retained Ernst &Young LLP to provide tax-related
services. Keen-Summit Capital Partners LLC has been hired as real
estate advisor. Binswanger of Texas, Inc. also has been retained
as real estate agent.
Sullivan & Cromwell LLP serves as counsel to TerraForm Power,
Inc.,
and TerraForm Global, Inc.
An official committee of unsecured creditors has been appointed in
the case. The Committee tapped Weil, Gotshal & Manges LLP as its
general bankruptcy counsel and Morrison & Foerster LLP as special
counsel. Togut, Segal & Segal LLP and Kobre & Kim LLP serve as
conflicts counsel. Alvarez & Marsal North America, LLC, serves as
the Committee's financial advisors.
Counsel to the administrative agent under the Debtors' prepetition
first lien credit agreement are Richard Levy, Esq., and Brad
Kotler, Esq., at Latham & Watkins.
Counsel to the administrative agent under the postpetition DIP
financing facility are Scott Greissman, Esq., and Elizabeth Feld,
Esq. at White & Case LLP.
Counsel to the Tranche B Lenders (as defined in the DIP credit
agreement) and the steering committee of the second lien creditors
are Arik Preis, Esq., and Naomi Moss, Esq., at Akin Gump Strauss
Hauer & Field, LLP.
Counsel to the administrative agent under the Debtors' prepetition
second lien credit agreement is Daniel S. Brown, Esq., at
Pillsbury
Winthrop Shaw Pittman LLP.
The collateral trustee under the Debtors' prepetition second lien
credit agreement and the indenture trustee under each of the
Debtors' outstanding bond issuances, is represented by Marie C.
Pollio, Esq., at Shipman & Goodwin LLP.
Counsel to the ad hoc group of certain holders of the Debtors'
convertible senior notes is White & Case LLP's Tom Lauria, Esq.
SUNPOWER BY RENEWABLE: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Sunpower by Renewable Energy
Electric, Inc., as of Jan. 19, according to a court docket.
About Sunpower by Renewable Energy Electric
Sunpower by Renewable Energy Electric, Inc., fdba V.E.C. Inc., fdba
Renewable Energy Electric, Inc., based in 7180 Dean Martin Drive,
Suite 100, Las Vegas, Nevada, filed a chapter 11 petition (Bankr.
D. Nev. Case No. 16-14459-led) on August 12, 2016. The petition was
signed by Jason M. Vita, president.
The case is assigned to Judge Laurel E. Davis. The Debtor is
represented by Samuel A. Schwartz, Esq., and Bryan A. Lindsey,
Esq., at Schwartz Flansburg PLLC.
The Debtor is a solar energy company and provides solar energy
services, including the assessment and installation of solar panels
to residential and commercial customers in Nevada, Arizona and
California.
At the time of filing, the Debtor estimated assets at $1 million to
$10 million and liabilities at $1 million to $10 million. A list
of the Debtor's 11 unsecured creditors is available for free at
http://bankrupt.com/misc/nvb16-14459.pdf
SUNSET9 LLC: Case Summary & Unsecured Creditor
----------------------------------------------
Debtor: Sunset9 LLC
27867 Smyth Drive, Suite 101
Valencia, CA 91355
Case No.: 17-10624
Chapter 11 Petition Date: January 19, 2017
Court: United States Bankruptcy Court
Central District of California (Los Angeles)
Judge: Hon. Sheri Bluebond
Debtor's Counsel: Louis J Esbin, Esq.
LAW OFFICES OF LUIS J. ESBIN
25129 The Old Road, Ste 114
Stevenson Ranch, CA 91381-2273
Tel: 661-254-5050
Fax: 661-254-5252
E-mail: Esbinlaw@sbcglobal.net
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joel Abergel, managing member.
The Debtor listed The Druggist, Inc. as its unsecured creditor
holding a claim of $965,000.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/cacb17-10624.pdf
TIMS TRUCKING: Dugan Buying All Assets for 81K
----------------------------------------------
Tim's Trucking, Inc., asks the U.S. Bankruptcy Court for the
District of Nebraska to authorize the sale of farm real estate in
Greeley County, Nebraska, for $34,000, and vehicles and equipment
for $47,000, to Daniel Dugan.
Dugan is son of the owners of the Debtor.
The farm real estate is legally described as Part of the NE 114 of
the SW 1/4 and part of the East 112 of the SW 114 of Section 12,
P.M. in Greeley County, Nebraska, 11.4 acres.
The vehicles and equipment to be sold are: (i) 2005 Freightliner
day cab with tax axle; (ii) 2011 Wilson spread axle trailer; (iii)
2006 Titan horse trailer; (iv) 1992 Honda 4 x 4; (v) 1998 Dodge
Dakota pickup; (v) 1985 Ford F150 pickup; (vi) 1988 Chevrolet
pickup; and (vii) miscellaneous older equipment.
Said assets will be sold after the objection time has run, free and
clear of any lien, claim or encumbrance of any party.
There will be no commission of realtor regarding the sale of said
assets.
The Secured Creditor on the Property, State Bank of Scotia, will
retain its lien, in the priority established under Nebraska or
applicable law, upon the proceeds of the sale of the Property.
Closing costs will first be deducted from the proceeds and the
balance of the proceeds paid to Scotia State Bank in accordance
with Nebraska law and bankruptcy law.
Pursuant to Rule 6004-1, the sale will encompass substantially all
of the assets of the bankruptcy estate and pursuant to the Order
confirming the liquidation plan.
The Debtor asks that the Court enter an order approving the sale of
Property free and clear to Dugan.
About Tim's Trucking Inc.
Tim's Trucking, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Neb. Case No. 16-40206) on Feb. 17,
2016. The petition was signed by Raymond T. Dugan, president.
At the time of the filing, the Debtor estimated assets and
liabilities of less than $500,000.
TLC HEALTH NETWORK: Authorized to Use Cash Collateral Thru Jan. 30
------------------------------------------------------------------
Judge Carl L. Bucki of the U.S. Bankruptcy Court for the Western
District of New York, authorized TLC Health Network, to use cash
collateral in which Brooks Memorial Hospital, Community Bank, N.A.,
UPMC, and the Dormitory Authority of the State of New York have an
interest.
Judge Bucki also authorized the Debtor to incur certain
postpetition indebtedness on a secured and super-priority basis
from Brooks Memorial Hospital in an aggregate amount equal to the
amounts in the Revised Budget.
The approved Budget provides for total expenses of $1,093,000 for
the week beginning January 16, 2017, $542,500 for the week
beginning Jan. 23, 2017 and $998,000 for the week beginning Jan.
30, 2017.
The Debtor's authority to use cash collateral will terminate on the
earliest to occur of:
(a) January 30, 2017, unless prior to that date, the Debtor
files a Plan and Disclosure Statement, in which case, termination
date will be February 27, 2017;
(b) Debtor's failure to comply with the terms of the
Seventeenth Amended Final Order;
(c) a sale or refinancing of substantially all of its assets
is proposed by the Debtor without the written consent of Brooks
Memorial that would not indefeasibly pay the indebtedness in full
in cash;
(d) any other motion is filed by the Debtor for any relief
directly or indirectly affecting the Collateral in a material
adverse manner;
(e) the Debtor's failure to propose a plan of reorganization
or liquidation acceptable to Brooks Memorial in all respects, on or
before February 27, 2017;
(f) entry by the Court of an order reversing, amending,
supplementing, staying, vacating or otherwise modifying the terms
of the Order without the written consent of Brooks Memorial;
(g) sale, pledge, assignment or hypothecation of all or
substantially all of the collateral;
(h) the conversion of the Debtor's bankruptcy case to a case
under Chapter 7 pf the Bankruptcy Code;
(i) the appointment of a trustee or examiner or other
representative with expanded powers for the Debtor; or
(j) the occurrence of the effective date or consummation of a
plan of reorganization.
The Debtor and the Committee agreed to: (a) keep Brooks Memorial
apprised of and included in the negotiations surrounding and
leading up to a refinancing or sale transaction, (b) agree to allow
representatives of Brooks Memorial to participate in calls or
meetings with prospective bidders or investors, and (c) will share
letters of intent, offers, draft agreements with Brooks Memorial
throughout the refinancing or sale transaction process.
A further hearing approving the Debtor's use of cash collateral
will be held on January 30, 2017 at 1:00 p.m., unless the Debtor
files a Plan and Disclosure Statement prior to January 30, the
further hearing will be held on February 27, 2017 at 1:00 p.m.
A full-text copy of the Seventeenth Amended Final Order, dated
January 17, 2017, is available at https://is.gd/HBLwt2
About TLC Health Network
TLC Health Network filed a Chapter 11 petition (Bankr. W.D.N.Y.
Case No. 13-13294) on Dec. 16, 2013. The petition was signed by
Timothy Cooper as Chairman of the Board. The case is assigned to
the Hon. Carl L. Bucki.
The Debtor estimated assets of at least $10 million and debt of at
least $1 million.
Jeffrey A. Dove, Esq., at Menter, Rudin & Trivelpiece, P.C., serves
as the Debtor's counsel. Damon & Morey LLP is the Debtor's special
health care law and corporate counsel. The Bonadio Group is the
Debtor's accountants. Howard P. Schultz & Associates, LLC is the
Debtor's appraiser.
A three-member panel composed of Cannon Design, Chautauqua
Opportunities, Inc., and Jamestown Rehab Services has been
appointed as the official unsecured creditors committee. Bond,
Schoeneck & King, PLLC is the counsel to the Committee. The
Committee has tapped NextPoint LLC as financial advisor.
TRANSGENOMIC INC: Dismisses Ernst & Young as Accountants
--------------------------------------------------------
The Audit Committee of the Board of Directors of Transgenomic,
Inc., approved the dismissal of Ernst & Young LLP as the Company's
independent registered public accounting firm and accordingly the
Company notified Ernst & Young of that action effective as of
Jan. 12, 2017.
According to the Company, the dismissal of Ernst & Young as its
independent registered public accounting firm did not result from
any dissatisfaction with the quality of professional services
rendered by the firm.
The audit reports of Ernst & Young on the Company's consolidated
financial statements as of and for the two most recent fiscal years
did not contain an adverse opinion or a disclaimer of opinion, and
were not qualified or modified as to uncertainty, audit scope or
accounting principles.
During the Company's two most recent fiscal years, and any
subsequent interim period prior to termination of the
client-auditor relationship with Ernst & Young on Jan. 12, 2017,
there were no "disagreements" (as that term is described in Item
304(a)(1)(iv) of Regulation S-K and the related instructions)
between the Company and Ernst & Young on any matters of accounting
principles or practices, financial statement disclosure, or
auditing scope or procedure which, if not resolved to the
satisfaction of Ernst & Young, would have caused Ernst & Young to
make reference to the subject matter of such disagreements in their
reports on the Company's consolidated financial statements with
respect to those periods, the Company noted.
During the Company's two most recent fiscal years, and any
subsequent interim period prior to termination of the
client-auditor relationship with Ernst & Young on Jan. 12, 2017,
there were no "reportable events" as that term is described in Item
304(a)(1)(v) of Regulation S-K and the related instructions, except
for the material weaknesses in the Company's internal control over
financial reporting disclosed in its Form 10-K for the fiscal year
ended Dec. 31, 2014 (filed April 15, 2015), related to the design
of controls over proper timing and recognition of revenue and over
the elements used in the Company's analysis and evaluation of the
allowance for doubtful accounts to ensure that the allowance for
doubtful accounts was reasonably stated. The ineffectiveness of
these controls did not result in an adjustment to the financial
statements or a restatement of prior year financial statements. In
response to the material weaknesses, the Company's management
developed remediation plans to address the control deficiencies
identified in 2014. These remediation actions were implemented
during 2015 and included enhancements that included (i) with
respect to revenue recognition, (a) a reconciliation of proof of
delivery (fax confirmation) for invoiced and unbilled reports and
(b) a review of error processing queues, among other steps, and
(ii) with respect to allowances for doubtful accounts, (a) a review
of the payor and client accounts receivable aging (b) review of
write offs, (c) a review of current and historical payment trends
and (d) a review of actual cash collections and a hindsight
analysis, among other steps. The Company's management determined
that these remediation actions were effectively designed and
demonstrated effective operation for a sufficient period of time to
enable the Company's management to conclude that the 2014 material
weaknesses were remediated as of Dec. 31, 2015.
While the Company has not engaged a new independent registered
public accounting firm as of Jan. 19, 2017, it has begun a search
process to indentify Ernst & Young's successors. The Company will
disclose its engagement of a new independent registered public
accounting firm once the process has been completed and as required
by the SEC's rules and regulations.
About Transgenomic
Transgenomic, Inc. -- http://www.transgenomic.com/-- is a global
biotechnology company advancing personalized medicine in
cardiology, oncology, and inherited diseases through its
proprietary molecular technologies and world-class clinical and
research services. The Company is a global leader in cardiac
genetic testing with a family of innovative products, including
its C-GAAP test, designed to detect gene mutations which indicate
cardiac disorders, or which can lead to serious adverse events.
Transgenomic has three complementary business divisions:
Transgenomic Clinical Laboratories, which specializes in molecular
diagnostics for cardiology, oncology, neurology, and mitochondrial
disorders; Transgenomic Pharmacogenomic Services, a contract
research laboratory that specializes in supporting all phases of
pre-clinical and clinical trials for oncology drugs in
development; and Transgenomic Diagnostic Tools, which produces
equipment, reagents, and other consumables that empower clinical
and research applications in molecular testing and cytogenetics.
Transgenomic believes there is significant opportunity for
continued growth across all three businesses by leveraging their
synergistic capabilities, technologies, and expertise. The
Company actively develops and acquires new technology and other
intellectual property that strengthens its leadership in
personalized medicine.
Transgenomic reported a net loss available to common stockholders
of $34.3 million on $1.65 million of net sales for the year ended
Dec. 31, 2015, compared to a net loss available to common
stockholders of $15.08 million on $1.24 million of net sales for
the year ended Dec. 31, 2014.
As of Sept. 30, 2016, Transgenomic had $2.07 million in total
assets, $19.90 million in total liabilities and a total
stockholders' deficit of $17.82 million.
TRANSUNION LLC: Moody's Upgrades Corp. Family Rating to Ba3
-----------------------------------------------------------
Moody's Investors Service upgraded Trans Union, LLC's Corporate
Family Rating (CFR) and senior secured credit facility ratings to
Ba3, from B1, and affirmed its SGL-1 speculative grade liquidity
rating. The ratings outlook is positive. Moody's also assigned a
Ba3 rating to Trans Union's proposed approximately $2 billion of
Term Loan B and expects to withdraw the rating for its existing
Term Loan B at the close of the proposed amendment to the credit
agreement and extension of maturity for Term Loan B. Trans Union
LLC is an indirect subsidiary of TransUnion.
RATINGS RATIONALE
The upgrade of the Corporate Family Rating (CFR) reflects
TransUnion's greater financial flexibility resulting from strong
earnings growth, its increasingly diversified revenues and Moody's
expectation that the company will pursue balanced financial
policies and maintain leverage at or below 4x (Moody's adjusted).
Moody's expects organic revenue growth in the high single digits,
increasing adjusted EBITDA margins, and declining non-recurring
expenses to support strong free cash flow generation of about low-
to mid-teens percentages of total debt (Moody's adjusted) over the
next 12 to 18 months. Strong growth in EBITDA will provide
TransUnion flexibility to use debt for small acquisitions or
consolidating equity interest in foreign affiliates over time,
while maintaining leverage at or below 4x.
The positive outlook reflects Moody's expectation that TransUnion's
credit metrics will strengthen from adjusted EBITDA and free cash
flow growth.
The Ba3 CFR reflects TransUnion's stronger business profile as a
result of increasing revenue diversification and its sustainable
market position as one of the three principal global consumer
credit bureaus. In the consumer credit bureau business, TransUnion
and its peers benefit from high barriers to entry. At the same
time, a significant portion of TransUnion's revenues are driven by
the demand for credit reports, which is correlated to US
macroeconomic cycles. However, the main risks to the ratings stem
from the potential for periodic increases in debt to fund
acquisitions as part of the company's growth strategy and the
approximately 51% common equity interest held in the company by its
financial sponsors, which in Moody's view increases TransUnion's
event risk.
The SGL-1 speculative grade liquidity rating reflects TransUnion's
very good liquidity.
Moody's could upgrade TransUnion's ratings if the company (i)
maintains good earnings growth, (ii) demonstrates a track record of
balanced financial policies, (ii) private equity funds' equity
ownership declines materially, and (iv) sustains total debt to
EBITDA below 4x (Moody's adjusted) and free cash flow above 12% of
total debt. Conversely, the ratings could be downgraded if
aggressive financial policies cause total debt to EBITDA (Moody's
adjusted) to increase above 5x and free cash flow declines below 8%
of total debt.
Moody's has taken the following actions:
Issuer -- Trans Union, LLC
Corporate Family Rating -- Upgraded to Ba3, from B1
Probability of Default Rating -- Upgraded to B1-PD, from B2-PD
$210 million senior secured revolving credit facility due 2020 --
Upgraded to Ba3 (LGD3), from B1 (LGD 3)
$377 million (outstanding) senior secured Term Loan A due 2020 --
Upgraded to Ba3 (LGD3), from B1 (LGD 3)
Approximately $2 billion Term Loan B due 2021 -- Upgraded to Ba3
(LGD3), from B1 (LGD 3), to be withdrawn at the close of the
amendment
Approximately $2 billion Term Loan B due 2023 -- Assigned, Ba3
(LGD 3)
Speculative Grade Liquidity -- Affirmed, SGL-1
Outlook actions:
Issuer: TransUnion LLC
Outlook, Positive
TransUnion is a leading provider of information and risk management
solutions to businesses and consumers. Funds affiliated with Advent
International Corporation and Goldman Sachs & Co. own a combined
majority equity interest in TransUnion.
UCI INTERNATIONAL: Plan Filing Period Extended Through Feb. 27
--------------------------------------------------------------
Judge Mary F. Walrath of the U.S. Bankruptcy Court for the District
of Delaware extended the exclusive periods during which UCI
International, LLC and its affiliated Debtors may file a chapter 11
plan and solicit acceptances to the plan, through February 27, 2017
and April 28, 2017, respectively.
The Troubled Company Reporter had earlier reported that the Debtors
sought for exclusivity extension, contending that they have:
(a) negotiated, and obtained entry of an Order approving,
settlement agreements with (i) the Rank Group, the Committee, and
the Ad Hoc Group of Noteholders, and (ii) the Pension Benefit
Guaranty Corporation, which provided for the transfer of the
Debtors' pension plans, avoided costly litigation between the
parties, and enhanced recoveries for the Debtors' stakeholders;
(b) negotiated the terms of a replacement lease agreement for
the Debtors' corporate headquarters and obtained Court approval of
the same, resulting in significant cost savings to the Debtors and
their estates and facilitating the Debtors' efforts to separate
from the Rank Group;
(c) prepared and obtained Court approval of various motions
authorizing the Debtors to assume certain executory contracts and
unexpired leases;
(d) worked with various claimants to consensually resolve
motions requesting the allowance and payment of claims;
(e) prepared and filed a motion to enforce the stay and
seeking damages against Group Xpress Exports, LLC, d/b/a, GXE, LLC,
f/k/a, Parts-Zone, S.A. de C.V., f/k/a Filtros Carossi, S.A. de
C.V. and Filtros Y Partes, S.A. de C.V.; and
(f) commenced the claims reconciliation process, and, in
connection therewith, filed two omnibus claim objections.
The Court had entered its Confirmation Order, which confirmed the
Debtors' Joint Plan of Reorganization, but the Effective Date has
not yet occurred, as certain conditions precedent to the occurrence
of the Effective Date have not yet been met.
The Debtors told the Court that despite the progress made in their
chapter 11 cases thus far, the Effective Date of the Plan has not
yet occurred. The Debtors further told the Court that to protect
their rights in the unlikely event that the Plan does not become
effective, the Debtors request entry of the Proposed Order granting
an extension of the Exclusive Periods for a period of 60 days.
About UCI International, LLC
UCI International, LLC, headquartered in Lake Forest, IL, designs,
manufactures, and distributes vehicle replacement parts, including
a broad range of filtration, fuel delivery systems, and cooling
systems products in the automotive, trucking, marine, mining,
construction, agricultural, and industrial vehicles markets.
UCI and its affiliates sought Chapter 11 protection (Bankr. D. Del.
Lead Case No. 16-11355) on June 1, 2016. The Debtors are
represented by Jessica C.K. Boelter, Esq., Larry J. Nyhan, Esq.,
Kerriann S. Mills, Esq., and Jackson T. Garvey, Esq., at Sidley
Austin LLP. Alvarez & Marsal provides the company with financial
advice and Moelis & Company LLC is the Debtors' investment banker.
Garden City Group serves as the Debtors' Claims Agent. Wilmington
Trust is the Indenture Trustee for a $400-million issue of 8.625%
Senior Notes Due 2019.
The Debtors estimated assets at $100 million to $500 billion and
debt at $500 million to $1 billion at the time of the filing.
The United States Trustee appointed an Official Committee of
Unsecured Creditors, which has retained Morrison & Foerster LLP as
proposed counsel, and Cole Schotz PC as Delaware co-counsel. Zolfo
Cooper LLC has been retained as bankruptcy consultant and financial
advisor for the Committee.
Willkie Farr & Gallagher LLP and Morris Nichols Arsht & Tunnell LLP
represent an ad hoc group of unaffiliated noteholders of the 8.625%
senior unsecured notes issued by UCI International.
UNIFRAX HOLDING: S&P Revises Outlook to Stable & Affirms 'B' CCR
----------------------------------------------------------------
S&P Global Ratings said that it revised its outlook on Unifrax to
stable from negative and affirmed all its ratings on the company,
including S&P's 'B' corporate credit rating.
The outlook revision reflects Unifrax's successful execution of its
cost-saving initiatives, which the company implemented in the third
quarter of 2015, and S&P's expectations that the company's core end
markets are stabilizing. The company took these cost-reduction
actions in light of continued weakness in the global metals and
industrial markets served by its thermal management business, which
accounts for roughly half of the company's sales. As a result, the
company's EBITDA margin improved meaningfully, and debt leverage
improved to about 6.8x through the first nine months of 2016 from
about 7.3x as of year-end 2015. S&P expects the company to achieve
incremental savings of roughly $30 million for the full year 2016
and additional savings in 2017, allowing it to deleverage with debt
to EBITDA trending toward 6x over the next 12 months.
Unifrax has a limited scale of operations as a niche producer of
specialty insulating materials for industrial thermal management,
automotive emission control, fire protection, and battery separator
and filtration markets. S&P expects the company to maintain
significant market share globally as one of the top two competitors
in its segments; the remaining competition generally consists of
smaller regional players. S&P also expects Unifrax to continue
generating a significant proportion of revenue from maintenance and
replacement demand and from consumable products--primarily in its
industrial segment--which S&P believes helps reduce volatility in
earnings and cash flow. However, the company's end markets will
likely remain cyclical, fragmented, and highly competitive. S&P
assess Unifrax's business risk profile as weak.
S&P's base-case forecast assumes these factors:
-- Mid-single-digit percent revenue decline in 2016 due to
negative foreign currency headwinds and continued weakness
in thermal management, partly offset by growth in the
company's emission control and specialty fiber segment.
-- For 2017, S&P forecasts revenue to be roughly flat as end
markets begin to stabilize.
-- S&P Global Ratings' adjusted EBITDA margins improving to
around 23% in 2016 and 25% in 2017, supported by
restructuring and cost-saving initiatives.
-- Moderately positive free operating cash flow (FOCF) of
roughly $30 million in 2016, decreasing to roughly
$15 million in 2017 as the company completes above normal
capital spending following delays and underspending in 2016
and to fund growth in its emission control and specialty
fibers segment. No acquisitions are expected over the next
12 months.
Based on these assumptions, S&P arrives at these credit measures:
-- S&P Global Ratings' adjusted debt-to-EBITDA measure of
around 6.6x in 2016, improving toward 6x in the next 12-18
months, resulting primarily from continued cost savings and
debt repayment.
-- Funds from operations (FFO) of 10%-11%.
Unifrax has adequate liquidity over the next 12 months, despite the
near-term maturity of its $50 million revolver, which expires in
November 2017. As of September 2016, the revolver remained
undrawn, other than $1.2 million letters of credit outstanding.
While S&P don't anticipate Unifrax to draw on its revolver given
positive free cash flow, S&P expects the company to proactively
address its maturity to maintain financial flexibility.
Additionally, the company's term loans mature in 2018 and senior
notes mature in February 2019.
S&P expects that the company's sources of liquidity, not factoring
in the revolver, will be at least 1.2x its uses over this period.
S&P also expects that the company's net liquidity sources will
remain positive even if EBITDA declines by 15%.
Principal liquidity sources:
-- More than $40 million in FFO annually; and
-- Roughly $53 million cash on hand as of Sept. 30, 2016.
Principal liquidity uses:
-- Capital expenditures of roughly $20 million in 2016 and
S&P's expectations for an increase in spending in 2017;
-- Modest working capital requirements; and
-- About $5 million-$10 million term loan payments.
The revolver is subject to a springing senior secured net leverage
ratio covenant of 4.75 that goes into effect when the amount
outstanding exceeds $15 million. The springing covenant steps down
to 4.5x on March 31, 2017, with further quarterly step-downs. S&P
believes the company would not be in compliance if the covenant
were to come into effect. However, S&P do not expect the company
to draw on its revolver to an extent that it triggers the springing
covenant over the next several quarters.
The outlook is stable. The company achieved targeted cost savings
in 2016, allowing it to reduce debt leverage to 6.8x from 7.3x at
the end of 2015, in spite of end market headwinds. S&P expects
Unifrax will continue this trend in 2017, with leverage approaching
6x as end markets stabilize and the company is able to achieve
additional cost savings. S&P expects the company will maintain
above average EBITDA margins in excess of 20% and positive FOCF.
S&P could lower the rating if end markets are likely to be weaker
than S&P expects, causing revenues to decline further and leverage
to remain above 6.5x. S&P could also lower the rating if free cash
flow falls below S&P's expectations or if it appears likely that
the company will draw on its revolver to an extent that it triggers
the leverage covenant and the company is not likely to have 15%
headroom. Additionally, S&P could lower ratings if Unifrax is not
able to address the near-term maturity of its revolver, as well as
proactively refinance the term loan maturing in November 2018.
Although unlikely, S&P could raise its rating on Unifrax if
stronger than expected growth in the company's end markets leads to
high cash flow generation and greater debt reduction, such that its
financial leverage declines to and remains below 5x. Before
considering an upgrade, S&P would also need to believe that the
company would adhere to a less aggressive financial policy
consistent with a higher rating.
VACATION FUN: Wants to Use Civic Financial Cash Collateral
----------------------------------------------------------
Vacation Fun, LLC seeks authorization from the U.S. Bankruptcy
Court for the Central District of California to use cash
collateral.
The Debtor intends to use cash collateral to pay for expenses of
maintaining and operating its Property, consisting of a
single-family home, operating as a short-term rental unit, located
at 907 West Broadway, Anaheim, CA 92805. The Debtor believes the
Property to have a market value of approximately $699,000, as of
the Petition Date.
The Debtor proposes to use about $1,000 a month in cash collateral,
in order to generate income of $9,000 a month.
Without the ability to use the cash collateral, the Debtor will be
unable to pay its expenses, which will cause the Property to become
uninhabitable, thereby damaging Civic Financial's collateral and
significantly reducing the value of the Property.
The Property secures two obligations: one to Civic Financial
Services, which holds a deed of trust in the amount of $659,096,
and the other to the City of Anaheim, which holds a tax lien
against the Property for $10,000.
The Debtor asserts that Civic Financial's lien is oversecured since
it will attach to the net profits. The Debtor further asserts that
the lien is secured by more and more cash as the Bankruptcy case
progresses. As reflected in the Debtor's proposed Budget, the
Debtor's continued operation of the business will continue to
generate and preserve the value of the Property.
As adequate protection, the Debtor proposes to make interest
payments to Civic Financial in the amount of $4,200 a month and pay
the property taxes, leaving the Estate $2,000 to $3,000 each month.
The Debtor asserts that the use of cash collateral is critical to
its ability to implement an effective reorganization strategy. The
Debtor further asserts if it is permitted to use cash collateral,
in accordance with the Budget -- which projects total monthly
operating expenses of $5,625 -- the Debtor will be able to preserve
and maximize its asset as it will be generating revenue from its
continued operating, thereby allowing the Debtor to make interest
payments now and to save the funds to pay the arrears once the case
is confirmed.
A hearing on the Debtor's Motion is scheduled on Feb. 1, 2016 at
10:00 a.m.
A full-text copy of the Debtor's Motion, dated Jan. 10, 2017, is
available at https://is.gd/qQe4GG
About Vacation Fun
Vacation Fun, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C. D. Calif. Case No. 16-13841) on Sept.
13, 2016. The petition was signed by Stephanie Mendoza, manager.
The case is assigned to Judge Catherine E. Bauer. At the time of
the filing, the Debtor had $500,000 to $1 million in estimated
assets and $1 million to $10 million in estimated liabilities.
The Debtor is represented by Michael Avanesian, Esq. and Sloan
Youkstetter, Esq., at Avanesian Law Firm.
Vacation Fun's bankruptcy case was filed to prevent the foreclosure
sale of its rental property located at 907 West Broadway, Anaheim,
California. Ms. Mendoza is the sole owner and managing member of
Vacation Fun and is responsible for its operations.
VAPOR CORP: Announces Preliminary Results of Cash Tender Offer
--------------------------------------------------------------
Vapor Corp. announced the preliminary results of its tender offer
to purchase up to 32,262,152 of its outstanding Series A warrants
at a purchase price of $0.22 per warrant in cash. The Company's
tender offer for the Series A Warrants expired at 5:00 p.m.,
Eastern time, on Jan. 17, 2017. Based on a preliminary count by
Equity Stock Transfer, LLC, the depositary for the tender offer, as
of the expiration date for the tender offer, a total of 10,073,884
Series A Warrants were properly tendered and not withdrawn, for a
total purchase price of approximately $2.16 million. Payment for
the Series A Warrants accepted for purchase in the tender offer
will be made promptly by Vapor Corp.
After completion of the tender offer for the Series A Warrants, the
Company expects that 48,956,712 Series A Warrants will remain
outstanding.
Okapi Partners acted as the information agent for the Offer, and
the depositary for the Offer is Equity Stock Transfer, LLC. For
questions and information, please call the information agent at
(877) 629-6356 (banks and brokers call (212) 297-0720).
About Vapor Corp
Vapor Corp. operates 20 vape stores in the Southeastern United
States and online where it sells vaporizers, liquids for vaporizers
and e-cigarettes. The Company also designs, markets and
distributes electronic cigarettes, vaporizers, e-liquids and
accessories under the Vapor X, Hookah Stix, Vaporin, Krave, and
Honey Stick brands. "Electronic cigarettes" or "e-cigarettes," and
"vaporizers" are battery-powered products that enable users to
inhale nicotine vapor without fire, smoke, tar, ash, or carbon
monoxide. The Company also designs and develops private label
brands for its distribution customers. Third party manufacturers
manufacture the Compoany's products to meet its design
specifications. The Company markets its products as alternatives
to traditional tobacco cigarettes and cigars. In 2014, as a
response to market product demand changes, Vapor began to shift its
primary focus from electronic cigarettes to vaporizers.
Vapor Corp reported a net loss allocable to common shareholders of
$36.26 million in 2015 following a net loss allocable to common
shareholders of $13.85 million in 2014. As of Sept. 30, 2016,
Vapor Corp. had $20.76 million in total assets, $48.72 million in
total liabilities and a total stockholders' deficit of $27.95
million.
Marcum LLP, in New York, NY, issued a "going concern" qualification
on the consolidated financial statements for the year ended Dec.
31, 2015, citing that Company has incurred net losses and needs to
raise additional funds to meet its obligations and sustain its
operations. In addition, the Company currently does not have
enough authorized common shares to settle all of its outstanding
warrants if those warrants were exercised pursuant to their
cashless exercise provisions. As a result, the Company could be
required to settle a portion of these warrants with cash. These
conditions, the auditors said, raise substantial doubt about the
Company's ability to continue as a going concern.
VAUGHAN FITNESS: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
An official committee of unsecured creditors has not yet been
appointed in the Chapter 11 case of Vaughan Fitness, as of Jan. 19,
according to a court docket.
Headquartered in Las Vegas, Nevada, Vaughan Fitness filed for
Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 16-14940)
on Sept. 8, 2016, estimating its assets at up to $50,000 and its
liabilities at betweeen $100,001 and $500,000. Seth D Ballstaedt,
Esq., at The Ballstaedt Law Firm serves as the Debtor's bankruptcy
counsel.
VIOLIN MEMORY: Posts $17.6M Net Loss in 3 Months Ended Oct. 31
--------------------------------------------------------------
Violin Memory, Inc. disclosed in a filing with the Securities and
Exchange Commission that it posted a net loss of $17,606,000 for
the three months ended Oct. 31, 2016, on total revenues of
$7,022,000.
The Company said that as of Oct. 31, 2016, it had $38,841,000 in
total assets against $144,467,000 in total liabilities, and
$105,626,000 in stockholders' deficit.
The Company said it was not able to complete its quarterly report
on Form 10-Q for the period ended October 31, 2016, by the
prescribed date without unreasonable effort or expense due to
ongoing restructuring discussions. In lieu of such report, and
without limiting the Company's intentions with respect to its
reporting obligations during the pendency of the Chapter 11 Case,
the Company filed the Condensed Consolidated Statements of
Operations, Condensed Consolidated Balance Sheets and Condensed
Consolidated Statements of Cash Flows for the period ended October
31, 2016 with this Current Report on Form 8-K. The Financial
Schedules assume the Company will continue as a going concern, with
realization of assets and settlement of liabilities in the normal
course of business. They do not include any adjustments for the
recovery and classification of assets or the amounts and
classification of liabilities that might be necessary should the
Company be unable to continue as a going concern.
A copy of Violin's report is available at https://is.gd/pswu7P
During the pendency of the Chapter 11 Case, the Company plans to
modify its reporting with respect to its obligations under the
federal securities laws. During such period, in lieu of filing
periodic reports on Forms 10-K and Forms 10-Q, the Company plans to
file Current Reports on Form 8-K attaching the monthly operating
reports filed with the Bankruptcy Court in the Chapter 11 Case.
The Company plans to continue to file current reports on Form 8-K
as required by the federal securities laws. The Company believes
that this modified reporting program is consistent with the
protection of its investors as set forth in SEC Exchange Act
Release No. 9660, dated June 30, 1972.
About Violin Memory
Violin Memory, Inc., develops and supplies memory-based storage
systems for high-speed applications, servers and networks in the
Americas, Europe and the Asia Pacific. Founded in 2005, the
Company
is headquartered in Santa Clara, California.
Violin Memory sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 16-12782) on Dec. 14, 2016. The
petition was signed by Cory J. Sindelar, chief financial officer.
At the time of the filing, the Debtor disclosed $38.93 million in
assets and $145.4 million in liabilities.
Pillsbury Winthrop Shaw Pittman LLP serves as the Debtor's legal
counsel while Bayard, P.A., serves as co-counsel. The Debtor has
hired Houlihan Lokey Capital, Inc. as financial advisor and
investment banker. Prime Clerk LLC serves as administrative
advisor.
The U.S. Trustee, on Dec. 27, 2016, named three creditors to serve
on the official committee of unsecured creditors -- Wilmington
Trust, N.A., Clinton Group, Inc., and Forty Niners SC Stadium
Company LC.
WILLIAM THOMAS JR: Court Won't Amend Clear Channel Lift Stay Order
------------------------------------------------------------------
Judge David S. Kennedy of the United States Bankruptcy Court for
the Western District of Tennessee, Western Division, denied Debtor
William H. Thomas, Jr.'s Rule 9023 motion to alter or amend the
order entered on November 28, 2016.
On February 4, 2016, the Tennessee Chancery Court entered a
judgment in favor of Clear Channel Outdoor, Inc., in the amount of
$3,906,000, and in favor of Tennison Brothers, Inc., in the amount
of $1,094,670.94 arising from Thomas' alleged construction of an
unpermitted and illegal billboard without obtaining a permit under
the Tennessee Billboard Act.
On April 15, 2016, Thomas appealed the judgment to the Tennessee
Court of Appeals. However, after filing the notice of appeal, on
June 3, 2016, Thomas submitted a suggestion of bankruptcy to the
Court of Appeals.
Clear Channel and Tennison Brothers both filed proofs of claim in
Thomas' Chapter 11 case based upon the judgment rendered by the
Chancery Court. On October 28, 2016, Clear Channel filed a motion
and memorandum for relief from the automatic stay to allow the
pending appeal to proceed to finality; and on October 31, 2016,
Tennison Brothers filed a notice of joinder.
On November 28, 2016, the Court entered a combined order granting
both Clear Channel's motion and Tennison Brothers' notice of
joinder. The Court found that sufficient "cause" existed to allow
Clear Channel and Tennison Brothers relief from the automatic stay
in order for the appeal to be finalized.
On December 12, 2016, Thomas filed a motion to alter or amend the
Court's order which lifted the automatic stay as to Clear Channel
and Tennison Brothers.
Judge Kennedy found that Thomas has not sufficiently satisfied any
of the three required ways to alter or amend a prior order. First,
the judge does not believe that the Court committed a clear error
of law. Second, the judge noted that there has not been any newly
discovered evidence to present to the Court. Lastly, the judge
opined that the prior ordder does not rise to a level that would
create "manifest injustice." In addition, the judge pointed out
that Thomas is absolutely afforded the right to appeal the order.
Judge Kennedy saw no reason under a totality of the particular
facts and circumstances and applicable law to reconsider the
Court's prior order because Thomas offered no reasonable legal or
factual basis to alter, amend, or vacate the prior Order.
A full-text copy of Judge Kennedy's January 11, 2017 memorandum and
order is available at http://bankrupt.com/misc/tnwb16-27850-208.pdf
The debtor is represented by:
Michael P. Coury, Esq.
GLANKLER BROWN PLLC
6000 Poplar Avenue, Suite 400
Memphis, TN 38119
Tel: (901)525-1322
Fax: (901)525-2389
Email: mcoury@glankler.com
Clear Channel Outdoor, Inc. is represented by:
Robert L. J. Spence, Jr., Esq.
Kristina A. Woo, Esq.
80 Monroe Avenue, Garden Suite One
Memphis, TN 38103
Email: rspence@spence-lawfirm.com
kwoo@spence-lawfirm.com
Tennison Brothers, Inc. is represented by:
Kathy Baker Tennison, Esq.
8295 Tournament Drive, Suite 150
Memphis, TN 38125
Email: Kathy@bakertennisonlaw.com
-- and --
Stuart B. Breakstone, Esq.
1661 International Place Drive, Suite 400
Memphis, TN 38120
Email: Stuart@breakstonelawoffice.com
RREF St. Acquisitions, LLC is represented by:
R. Spencer Clift, III, Esq.
165 Madison Avenue, Suite 2000
First Tennessee Building
Memphis, TN 38103
Email: sclift@bakerdonelson.com
The case is In re: William H. Thomas, Jr., Debtor, Case No.
16-27850-DSK (Bankr. W.D. Tenn.).
YRC WORLDWIDE: Amends $350 Million Securities Prospectus with SEC
-----------------------------------------------------------------
YRC Worldwide Inc. filed with the Securities and Exchange
Commission an amended registration statement on Form S-3/A relating
to the sale, from time to time, in one or more offerings, of any
combination of these securities:
* debt securities, in one or more series, which may be senior
debt securities or subordinated debt securities and secured
debt securities or unsecured debt securities, in each case
consisting of notes or other evidences of indebtedness;
* warrants to purchase debt securities;
* shares of the Company's common stock;
* warrants to purchase common stock;
* shares of the Company's preferred stock;
* depositary shares;
* purchase contracts;
* units;
* subscription rights; or
* any combination of these securities.
The Company amended the Registration Statement to delay its
effective date.
The securities will have an aggregate initial offering price of up
to $350,000,000 or an equivalent amount in U.S. dollars if any
securities are denominated in a currency other than U.S. dollars.
The securities may be offered separately or together in any
combination and as separate series.
The Company's common stock is traded on the Nasdaq Global Select
Market under the symbol "YRCW." If the Company decides to list or
seek a listing for any other securities, the related prospectus
supplement will disclose the exchange or market on which the
securities will be listed or where the Company has made an
application for listing, as applicable.
A full-text copy of the amended prospectus is available at:
https://is.gd/q4QLU6
About YRC Worldwide
Headquartered in Overland Park, Kan., YRC Worldwide Inc. (NASDAQ:
YRCW) -- http://www.yrcw.com/-- is a holding company that offers
its customers a wide range of transportation services. These
services include global, national and regional transportation as
well as logistics.
YRC Worldwide reported net income attributable to common
shareholders of $700,000 on $4.83 billion of operating revenue for
the year ended Dec. 31, 2015, compared to a net loss attributable
to common shareholders of $85.8 million on $5.06 billion of
operating revenue for the year ended Dec. 31, 2014.
As of Sept. 30, 2016, the Company had $1.87 billion in total
assets, $2.21 billion in total liabilities and a total
shareholders' deficit of $342.2 million.
* * *
As reported by the TCR on Feb. 18, 2014, Moody's Investors Service
had upgraded the Corporate Family Rating for YRC Worldwide from
'Caa3' to 'B3', following the successful closing of its
refinancing transactions.
In the Aug. 11, 2015, TCR report, Standard & Poor's Ratings
Services said that it has raised its corporate credit rating on
YRC Worldwide to 'B-' from 'CCC+'.
"The upgrade reflects YRC's earnings growth and improved liquidity
position, along with our belief that gradual improvement in the
company's operating performance will result in credit measures
that are commensurate with the rating," said Standard & Poor's
credit analyst Michael Durand.
[*] Leveraged Loan Defaults Start Slow in 2017, Fitch Says
----------------------------------------------------------
The U.S. leveraged loan default rate ended 2016 at 1.8%, nearly on
par with the 1.7% rate seen at end-2015, says Fitch Ratings. That
rate is poised to move lower in January as $3.3 billion in defaults
from last year move out of the trailing 12-month (TTM) universe.
By end-January 2017, Fitch expects the rate will fall to 1.5%,
although it could move higher soon. Avaya is expected to file and
would push the default rate back to its 2016 year-end level.
"The past two Januaries included sizable defaults from Caesars and
Arch Coal, but this year has been quiet so far, with only one small
default for Shelf Drilling Holdings on the books," said Eric
Rosenthal, Senior Director of U.S. Leveraged Finance.
Excluding energy and metals/mining, the 2016 default rate was at
just 0.8% but is expected to tick up slightly this year. The
energy and metals/mining sector default rates reached new highs
last year, ending 2016 at 14.2% and 23.6%, respectively, while the
E&P subsector finished at 22.4%.
In the current improving commodity price environment, post-default
loan trading prices are also rising. First-lien loans saw their
30-day TTM post-default secondary bid prices advance to 50% at
end-2016, up from 39% at the end of 3Q16. Par-weighted 30-day
post-default prices averaged 61% over the past 10 years.
With last year's commodity price-related stresses affecting many
larger, public E&P and coal companies, sponsored companies across
all sectors showed slightly more resilience with an end-2016
default rate of 1.3%, lower than the 1.5% rate seen at end-2015.
The sponsored TTM rate is expected to finish January around 1.1%.
Non-sponsored companies ended 2016 at a rate of 2.6%, up from 2.2%
at end-2015. Dex Media Inc., Arch Coal Inc., Peabody Energy Corp.
and C&J Energy Services Ltd drove the non-sponsored default rate.
Fitch's CLO portfolio had a low par-weighted average default
exposure of just 0.7%. Fitch has identified a handful of companies
with a high risk of default in the next year that could impact
holdings within some Fitch CLO portfolios, which include Seadrill
Ltd, iHeart Communications, and Avaya.
[*] Recoveries Drop for Sector Debt Holders, Fitch Says
-------------------------------------------------------
Junior energy and metals & mining creditors saw lower recoveries in
bankruptcies resolved during the most recent commodity price
downturn, according to the latest edition of Fitch Ratings' Energy,
Power and Commodities Bankruptcy Case Studies report.
The average recovery rate for 48 unsecured claims in the sector
bankruptcy study was 30%, down from a 47% average recorded in
Fitch's April 2015 report.
"Relatively low enterprise valuations pushed fulcrum security
positions up in capital structures, leaving junior debt holders
with less residual value amid high leverage, price volatility and a
challenging M&A environment earlier in 2016," says Sharon Bonelli,
Senior Director, Leveraged Finance.
However, first lien debt recoveries held up, and were generally
stable at an average of 83% in the latest update versus 84% in
April 2015.
Many of the bankruptcies completed during the 2015 and 2016
downturn utilized restructuring support agreements (RSAs), with the
objective of right-sizing the capital structure rather than dealing
with operational or other business challenges. Pre-negotiated
cases minimized the average time in bankruptcy to four months,
compared to 11 months in cases that occurred before the last
downturn.
A number of the energy companies that filed for bankruptcy over the
past two years were smaller companies that were based in higher
cost production regions. Exploration and production (E&P)
companies and oilfield services providers were frequently among
those filing as limited financial flexibility, coupled with
borrowing base reductions and capex cuts took their toll in the low
commodity price environment.
Coal companies also felt the pain induced by weak market prices,
competition from natural gas in steam coal markets, and rising
environmental and compliance costs.
The adverse cyclical and secular dynamics resulted in record high
yield default rates in 2016 for the energy and metals & mining
sectors. Those sectors reached default rate peaks of 18.8% and
17.4% respectively last year. For issuers with high leverage and
insufficient liquidity, bankruptcy was the best or only option in
the face of depressed cash flow.
"By and large we believe the worst is over and the industries are
past the trough points," says Bonelli. "That said, while many of
the large high yield issuer defaults have already occurred, there
are companies with significant leverage that still have elevated
default risk."
Fitch has identified 21 high yield energy and metals & mining
companies, with $27.2 billion of bonds outstanding, it believes are
at high risk of default over the next 12 months. In addition,
there are 22 term loan borrowers from the two sectors that have
$16.5 billion of loans outstanding.
Fitch forecasts the energy sector high-yield default rate will end
2017 at a much lower 3% rate.
[^] BOND PRICING: For the Week from January 16 to 20, 2017
----------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
A. M. Castle & Co CASL 7.00 58.00 12/15/2017
American Tower Corp AMT 7.25 109.15 5/15/2019
Amyris Inc AMRS 6.50 55.25 5/15/2019
Avaya Inc AVYA 10.50 22.00 3/1/2021
Avaya Inc AVYA 10.50 16.00 3/1/2021
BPZ Resources Inc BPZR 6.50 3.02 3/1/2015
BPZ Resources Inc BPZR 6.50 3.02 3/1/2049
CEDC Finance Corp
International Inc CEDC 10.00 29.63 4/30/2018
Caesars Entertainment
Operating Co Inc CZR 5.75 66.75 10/1/2017
Chassix Holdings Inc CHASSX 10.00 8.00 12/15/2018
Chassix Holdings Inc CHASSX 10.00 8.00 12/15/2018
Chukchansi Economic
Development Authority CHUKCH 9.75 42.50 5/30/2020
Chukchansi Economic
Development Authority CHUKCH 9.75 42.25 5/30/2020
Cinedigm Corp CIDM 5.50 10.00 4/15/2035
Claire's Stores Inc CLE 9.00 50.25 3/15/2019
Claire's Stores Inc CLE 10.50 85.50 6/1/2017
Claire's Stores Inc CLE 8.88 21.00 3/15/2019
Claire's Stores Inc CLE 7.75 18.50 6/1/2020
Claire's Stores Inc CLE 9.00 52.50 3/15/2019
Claire's Stores Inc CLE 7.75 16.75 6/1/2020
Claire's Stores Inc CLE 9.00 49.75 3/15/2019
Cobalt International
Energy Inc CIE 2.63 40.25 12/1/2019
Cumulus Media
Holdings Inc CMLS 7.75 40.00 5/1/2019
DFC Finance Corp DLLR 10.50 49.50 6/15/2020
EXCO Resources Inc XCO 7.50 53.55 9/15/2018
Emergent Capital Inc EMG 8.50 40.00 2/15/2019
Energy Conversion
Devices Inc ENER 3.00 7.88 6/15/2013
Energy Future
Holdings Corp TXU 6.50 13.75 11/15/2024
Energy Future
Holdings Corp TXU 6.55 14.00 11/15/2034
Energy Future
Holdings Corp TXU 10.88 13.00 11/1/2017
Energy Future
Holdings Corp TXU 11.25 13.00 11/1/2017
Energy Future
Holdings Corp TXU 9.75 29.25 10/15/2019
Energy Future
Holdings Corp TXU 10.88 13.00 11/1/2017
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 10.00 21.75 12/1/2020
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 10.00 24.05 12/1/2020
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 6.88 22.00 8/15/2017
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 9.75 30.00 10/15/2019
Erickson Inc EAC 8.25 25.25 5/1/2020
Evergreen Solar Inc ESLR 4.00 0.39 7/15/2013
FXCM Inc FXCM 2.25 55.00 6/15/2018
Fleetwood Enterprises Inc FLTW 14.00 3.56 12/15/2011
Forbes Energy Services Ltd FESL 9.00 50.10 6/15/2019
GenOn Energy Inc GENONE 7.88 78.01 6/15/2017
Goodman Networks Inc GOODNT 12.13 35.00 7/1/2018
Gymboree Corp/The GYMB 9.13 35.00 12/1/2018
Homer City Generation LP GE 8.14 40.75 10/1/2019
Horsehead Holding Corp ZINC 10.50 80.25 6/1/2017
Illinois Power
Generating Co DYN 7.00 37.00 4/15/2018
Illinois Power
Generating Co DYN 6.30 36.63 4/1/2020
Iracore International
Holdings Inc IRACOR 9.50 52.00 6/1/2018
Iracore International
Holdings Inc IRACOR 9.50 52.00 6/1/2018
IronGate Energy
Services LLC IRONGT 11.00 33.25 7/1/2018
IronGate Energy
Services LLC IRONGT 11.00 37.38 7/1/2018
IronGate Energy
Services LLC IRONGT 11.00 35.63 7/1/2018
IronGate Energy
Services LLC IRONGT 11.00 35.63 7/1/2018
Jack Cooper Holdings Corp JKCOOP 9.25 43.78 6/1/2020
James River Coal Co JRCC 7.88 1.41 4/1/2019
Las Vegas Monorail Co LASVMC 5.50 0.83 7/15/2019
Lehman Brothers
Holdings Inc LEH 1.00 2.58 7/21/2009
Lehman Brothers
Holdings Inc LEH 2.07 2.58 6/15/2009
Lehman Brothers
Holdings Inc LEH 1.00 2.58 6/9/2009
Lehman Brothers
Holdings Inc LEH 5.00 2.58 2/7/2009
Lehman Brothers
Holdings Inc LEH 1.25 2.58 3/22/2012
Lehman Brothers
Holdings Inc LEH 1.00 2.58 12/9/2012
Lehman Brothers
Holdings Inc LEH 1.00 2.58 9/7/2012
Lehman Brothers
Holdings Inc LEH 1.00 2.58 9/16/2010
Lehman Brothers
Holdings Inc LEH 1.00 2.58 9/16/2010
Lehman Brothers
Holdings Inc LEH 1.00 2.58 11/3/2011
Lehman Brothers
Holdings Inc LEH 1.60 2.58 11/5/2011
Lehman Brothers
Holdings Inc LEH 1.00 2.58 8/17/2014
Lehman Brothers
Holdings Inc LEH 1.00 2.58 11/2/2011
Lehman Brothers
Holdings Inc LEH 1.00 2.58 3/29/2014
Lehman Brothers
Holdings Inc LEH 1.25 2.58 8/5/2012
Lehman Brothers
Holdings Inc LEH 1.50 2.58 3/29/2013
Lehman Brothers
Holdings Inc LEH 2.00 2.58 3/3/2009
Lehman Brothers
Holdings Inc LEH 1.00 2.58 8/17/2014
Lehman Brothers
Holdings Inc LEH 1.25 2.58 2/6/2014
Lehman Brothers
Holdings Inc LEH 1.38 2.58 6/15/2009
Lehman Brothers
Holdings Inc LEH 1.00 2.58 10/17/2013
Lehman Brothers
Holdings Inc LEH 4.00 2.58 4/30/2009
Lehman Brothers Inc LEH 7.50 1.23 8/1/2026
Light Tower Rentals Inc LHTTWR 8.13 43.00 8/1/2019
Light Tower Rentals Inc LHTTWR 8.13 43.00 8/1/2019
Linn Energy LLC / Linn
Energy Finance Corp LINE 8.63 46.00 4/15/2020
Linn Energy LLC / Linn
Energy Finance Corp LINE 6.50 43.50 5/15/2019
Linn Energy LLC / Linn
Energy Finance Corp LINE 6.25 44.50 11/1/2019
Linn Energy LLC / Linn
Energy Finance Corp LINE 7.75 44.00 2/1/2021
Linn Energy LLC / Linn
Energy Finance Corp LINE 6.50 45.00 9/15/2021
Linn Energy LLC / Linn
Energy Finance Corp LINE 6.25 44.13 11/1/2019
Linn Energy LLC / Linn
Energy Finance Corp LINE 6.25 44.13 11/1/2019
MF Global Holdings Ltd MF 3.38 30.50 8/1/2018
MModal Inc MODL 10.75 10.13 8/15/2020
Midstates Petroleum
Co Inc / Midstates
Petroleum Co LLC MPO 10.75 0.73 10/1/2020
Modular Space Corp MODSPA 10.25 56.00 1/31/2019
Modular Space Corp MODSPA 10.25 56.25 1/31/2019
NRG REMA LLC GENONE 9.24 85.00 7/2/2017
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.25 2.60 5/15/2019
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.25 2.60 5/15/2019
New Gulf Resources LLC/
NGR Finance Corp NGREFN 12.25 2.60 5/15/2019
Nine West Holdings Inc JNY 8.25 26.00 3/15/2019
Nine West Holdings Inc JNY 6.88 24.25 3/15/2019
Nine West Holdings Inc JNY 8.25 29.50 3/15/2019
Nuverra Environmental
Solutions Inc NESC 9.88 11.32 4/15/2018
OMX Timber Finance
Investments II LLC OMX 5.54 9.13 1/29/2020
Peabody Energy Corp BTU 6.00 50.75 11/15/2018
Peabody Energy Corp BTU 6.00 59.25 11/15/2018
Peabody Energy Corp BTU 6.00 50.75 11/15/2018
Permian Holdings Inc PRMIAN 10.50 30.00 1/15/2018
Permian Holdings Inc PRMIAN 10.50 29.38 1/15/2018
Pernix Therapeutics
Holdings Inc PTX 4.25 25.00 4/1/2021
Pernix Therapeutics
Holdings Inc PTX 4.25 25.17 4/1/2021
Prospect Holding Co LLC /
Prospect Holding
Finance Co PRSPCT 10.25 47.90 10/1/2018
Prospect Holding Co LLC /
Prospect Holding
Finance Co PRSPCT 10.25 47.90 10/1/2018
Rex Energy Corp REXX 8.88 40.68 12/1/2020
River Rock
Entertainment Authority RIVER 9.00 21.25 11/1/2018
Rolta LLC RLTAIN 10.75 22.88 5/16/2018
SAExploration Holdings Inc SAEX 10.00 50.25 7/15/2019
Samson Investment Co SAIVST 9.75 7.22 2/15/2020
Sequa Corp SQA 7.00 56.00 12/15/2017
Sequa Corp SQA 7.00 56.38 12/15/2017
Sidewinder Drilling Inc SIDDRI 9.75 6.38 11/15/2019
Sidewinder Drilling Inc SIDDRI 9.75 6.38 11/15/2019
Stone Energy Corp SGY 1.75 60.00 3/1/2017
SunEdison Inc SUNE 5.00 38.00 7/2/2018
SunEdison Inc SUNE 2.75 3.68 1/1/2021
SunEdison Inc SUNE 2.38 3.60 4/15/2022
SunEdison Inc SUNE 2.00 3.50 10/1/2018
SunEdison Inc SUNE 0.25 3.00 1/15/2020
SunEdison Inc SUNE 3.38 2.75 6/1/2025
SunEdison Inc SUNE 2.63 3.25 6/1/2023
TMST Inc THMR 8.00 14.44 5/15/2013
Talos Production LLC /
Talos Production
Finance Inc TALPRO 9.75 52.50 2/15/2018
Talos Production LLC /
Talos Production
Finance Inc TALPRO 9.75 65.00 2/15/2018
TerraVia Holdings Inc TVIA 5.00 36.68 10/1/2019
TerraVia Holdings Inc TVIA 6.00 66.13 2/1/2018
Terrestar Networks Inc TSTR 6.50 10.00 6/15/2014
TetraLogic
Pharmaceuticals Corp TLOG 8.00 5.50 6/15/2019
Trans-Lux Corp TNLX 8.25 20.13 3/1/2012
UCI International LLC UCII 8.63 26.38 2/15/2019
Venoco LLC VQ 8.88 1.27 2/15/2019
Verso Paper Holdings LLC /
Verso Paper Inc VRS 11.75 17.00 1/15/2019
Verso Paper Holdings LLC /
Verso Paper Inc VRS 11.75 17.00 1/15/2019
Violin Memory Inc VMEM 4.25 8.50 10/1/2019
Walter Energy Inc WLTG 9.88 0.57 12/15/2020
Walter Energy Inc WLTG 9.88 0.57 12/15/2020
Walter Energy Inc WLTG 9.88 0.57 12/15/2020
iHeartCommunications Inc IHRT 10.00 72.50 1/15/2018
rue21 inc RUE 9.00 19.94 10/15/2021
rue21 inc RUE 9.00 19.50 10/15/2021
*********
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
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share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
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than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
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Each Friday's edition of the TCR includes a review about a book of
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Monthly Operating Reports are summarized in every Saturday edition
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The Sunday TCR delivers securitization rating news from the week
then-ending.
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*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA.
Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine
Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog,
Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa,
Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo
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Editors.
Copyright 2017. All rights reserved. ISSN: 1520-9474.
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*** End of Transmission ***