/raid1/www/Hosts/bankrupt/TCR_Public/181105.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, November 5, 2018, Vol. 22, No. 308
Headlines
ACHAOGEN INC: Borrows Additional $25 Million From Silicon Valley
ACIS CAPITAL: Plan Outline Okayed, Plan Hearing on Dec. 11
ADVANTAGE SALES: Bank Debt Trades at 17% Off
ADVANTAGE TENNIS: Seeks Authorization to Use Cash Collateral
AGILE THERAPEUTICS: Cash Expected to Fund Operations Into Q2 2019
AGILE THERAPEUTICS: Incurs $3.79 Million Net Loss in Third Quarter
AGILE THERAPEUTICS: May Issue 3.86 Mil. Shares Under Incentive Plan
AGILE THERAPEUTICS: Will Sell $100 Million Worth of Securities
AMERICAN DENTAL: S&P Affirms 'B-' ICR, Outlook Stable
AMERICAN TIRE: Bank Debt Trades at 11% Off
AMICIZIA LLC: Seeks Authorization to Use Cash Collateral
ANIMIS FOUNDATION: Voluntary Chapter 11 Case Summary
ATD CORP: Sailun Jinyu Leaves Creditors' Committee
ATLANTIC CITY: Moody's Hikes Issuer Rating to B2, Outlook Positive
BEAUTIFUL BROWS: Ameris Bank Objects Further Cash Collateral Use
BEAUTIFUL BROWS: Seeks Authorization to Use Cash Collateral
BELK INC: Bank Debt Trades at 16% Off
BIOSCRIP INC: Reaffirms Guidance for 2019 Adjusted EBITDA of $75M
BLUE BEE: May Continue Using Cash Collateral Until Jan. 26
BOSSLER ROOFING: Exclusive Plan Filing Deadline Moved to Dec. 10
CALIFORNIA RESOURCES: Posts $66 Million Net Income in 3rd Quarter
CAMBER ENERGY: Investor Buys $3.5-Mil. Convertible Preferred Stock
CELESTICA INC: Moody's Affirms Ba2 CFR, Outlook Stable
CELESTICA INC: S&P Lowers Senior Secured Debt Rating to 'BB'
CENGAGE: Bank Debt Trades at 6% Off
CHARLOTTE HOUSING: S&P Alters Outlook on CCC+ Bonds Rating to Neg.
CHATEAU VILLABOIS: Plan Exclusivity Period Extended Through Nov. 5
CINRAM GROUP: Plan Outline Okayed, Plan Hearing on Nov. 29
CLASSIC COMMUNITIES: Plan Outline Okayed, Plan Hearing on Dec. 20
COLONIAL OAKS: Judge Signs Final Cash Collateral Order
COMMUNITY CHOICE: Reaches Restructuring Agreement with Noteholders
CONCORDIA INTERNATIONAL: Will Release its Q3 Results on Nov. 14
COVIA HOLDINGS: Bank Debt Trades at 9% Off
CRT RECOVERY: Confirmation Hearing Set for Nov. 14
CRYOLIFE INC: S&P Affirms B Rating on $255MM Secured Loans
CWGS GROUP: $25MM Bank Debt Trades at 3% Off
CWGS GROUP: $93MM Bank Debt Trades at 3% Off
DAVID'S BRIDAL: Bank Debt Trades at 14% Off
DAVID'S PATIO: Seeks Access to Prosperity Bank Cash Collateral
DEL MONTE: Bank Debt Trades at 12% Off
DISASTERS STRATEGIES: May Use Cash Collateral on Final Basis
DIXIE ELECTRIC: Case Summary & 30 Largest Unsecured Creditors
DPW HOLDINGS: Amends Form S-3 Registration Statement with the SEC
FANNIE MAE: Reports $4 Billion Net Income for Third Quarter
FATE RESTAURANTS: Case Summary & 20 Largest Unsecured Creditors
FERMARALIZ CORP: Case Summary & 2 Unsecured Creditors
FORTERRA INC: Bank Debt Trades at 8% Off
GATEWAY WIRELESS: Seeks Authorization to Use Cash Collateral
GRAY TELEVISION: S&P Rates New $500MM Senior Unsecured Notes 'B+'
GREEN NATION: Case Summary & 20 Largest Unsecured Creditors
GRGCBHS LLC: Case Summary & 20 Largest Unsecured Creditors
GULF FINANCE: Bank Debt Trades at 17% Off
HOUGHTON MIFFLIN: Bank Debt Trades at 7% Off
INPIXON: Implements Reverse Stock Split for NASDAQ Compliance
J.P. QUESOS: Plan Exclusivity Period Extended to Nov. 19
JDS HOSPITALITY: Needs Access to Cash Through September 2019
JONES ENERGY: Files Form 10-Q for the Quarter Ended Sept. 30, 2018
KLOECKNER PENTAPLAST: Bank Debt Trades at 3% Off
LA CANASTA: Case Summary & 15 Unsecured Creditors
LANDS' END: Bank Debt Trades at 4% Off
LANNETT CO: Bank Debt Trades at 16% Off
LMBE-MC HOLDCO II: Moody's Rates $475MM Secured Loans 'Ba3'
LONGFIN CORP: Yogesh Patel Quits as Director
LSC COMMUNICATIONS: Moody's Affirms B1 CFR, Outlook Stable
M. D. MILLER TRUCKING: Case Summary & 8 Unsecured Creditors
MARRIOTT VACATIONS: S&P Lowers Secured Debt Rating to 'BB+'
MDVIP LLC: Moody's Affirms B3 Corp. Family Rating, Outlook Stable
MELINTA THERAPEUTICS: Stonepine Has 6.2% Stake as of Oct. 24
MICROVISION INC: Will Sell $60 Million Worth of Securities
MIDATECH PHARMA: Has Until April 29 to Regain Nasdaq Compliance
N&A PRODUCE: Case Summary & 20 Largest Unsecured Creditors
NEIGHBORS LEGACY: PCO Files 2nd Interim Report
NEWFIELD EXPLORATION: S&P Places 'BB+' ICR on CreditWatch Positive
NINE WEST: Continued Plan Negotiation Delays Filing of Plan
OCEAN SERVICES: Authorized to Use Cash Collateral, Obtain Financing
ODYSSEY LOGISTICS: S&P Affirms 'B' ICR, Outlook Remains Stable
PACIFIC DRILLING: Wants to Keep Exclusivity to Finalize Zonda Plan
PALADIN HOSPITALITY: Seeks Authorization to Use Cash Collateral
PARSLEY ENERGY: Moody's Raises CFR to Ba3, Outlook Stable
PETSMART INC: Bank Debt Trades at 15% Off
PIEDMONT SALES: Eighth Interim Cash Collateral Order Entered
POINTCLEAR SOLUTIONS: Case Summary & 20 Top Unsecured Creditors
POLICLINICA FAMILIAR: Plan Outline Okayed, Plan Hearing on Dec. 11
QUAD/GRAPHICS INC: Moody's Alters Outlook on Ba3 CFR to Negative
REAGOR AUTO MALL: Voluntary Chapter 11 Case Summary
RELATIVITY MEDIA: Files Chapter 11 Joint Liquidating Plan
REPUBLIC METALS: Case Summary & 30 Largest Unsecured Creditors
RESOLUTE ENERGY: KEMC Fund Has 11.9% Stake as of Oct. 30
RMH FRANCHISE: Wants to Maintain Exclusivity Until Jan. 18
SALLE FAMILY: Seeks Authority to Use Boyd Cash Collateral
SCURRY COUNTY: Moody's Affirms Ba2 Issuer Ratings, Outlook Neg.
SEADRILL LIMITED: Bank Debt Trades at 6% Off
SEMLER SCIENTIFIC: Reports Net Income of $1.5 Million for Q3
SHIV JI SHANKER: Case Summary & 20 Largest Unsecured Creditors
SILVER SCREEN: Voluntary Chapter 11 Case Summary
SILVERADO STAGES: May Use Cash Collateral on Interim Basis
SINGLETON FOOD: Voluntary Chapter 11 Case Summary
SMTT INC: Seeks Authority on Interim Cash Collateral Use
SOUTHEASTERN HOSPITALITY: Seeks Authority to Use Cash Collateral
SOVOS BRANDS: Moody's Assigns B3 CFR, Outlook Stable
SOVOS BRANDS: S&P Assigns B- Issuer Credit Rating, Outlook Positive
ST. JUDE NURSING: Case Summary & 20 Largest Unsecured Creditors
STEPHANIE N. MAPP: Seeks Authorization to Use Cash Collateral
SUGARLOAF HOLDINGS: Seeks Authorization to Utilize Cattle Proceeds
TEMPEST GROUP: Chicago Title Opposes Approval of Plan Outline
TURN-KEY SPECIALISTS: U.S. Trustee Forms 3-Member Committee
UNITI GROUP: Posts $2.07 Million Net Income in Third Quarter
UNIVISION COMMUNICATION: Bank Debt Trades at 3% Off
US RENAL: Bank Debt Trades at 2% Off
VERITAS SOFTWARE: Bank Debt Trades at 4% Off
VYAIRE MEDICAL: S&P Lowers ICR to CCC+, Outlook Negative
W&T OFFSHORE: Files Quarterly Report on Form 10-Q
W&T OFFSHORE: Posts Third Quarter Net Income of $46.3 Million
WEATHERFORD INTERNATIONAL: Posts $199 Million 3rd Quarter Net Loss
WEDDINGWIRE INC: S&P Assigns B Issuer Credit Rating, Outlook Stable
WELBILT INC: S&P Affirms BB- Issuer Credit Rating, Outlook Stable
WEST VIRGINIA UNIVERSITY: Moody's Affirms B1 on Revenue Bonds
[^] BOND PRICING: For the Week from October 29 to November 2
*********
ACHAOGEN INC: Borrows Additional $25 Million From Silicon Valley
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Achaogen, Inc., has borrowed $25.0 million under its existing Loan
and Security Agreement with Silicon Valley Bank dated as of Feb.
26, 2018. As previously disclosed, the Company borrowed $25.0
million under the Loan Agreement on the date of the Loan Agreement.
The Term B Loan has a maturity of four years and bears interest
through maturity at a floating per annum rate equal to the greater
of (a) 1.00% above the prime rate and (b) 5.50%. No borrowings
remain available to the Company under the Loan Agreement.
The Company is permitted to make interest-only payments on the Term
B Loan for the first 24 months following the borrowing date after
which the Company will be required to repay the Term B Loan in 24
consecutive equal monthly installments of principal. The Company
is obligated to pay a fee equal to 6.00% of the Term Loans upon the
earliest to occur of the maturity date, the prepayment or repayment
of the Term B Loan or the termination of the Loan Agreement. The
Company may voluntarily prepay all, but not less than all, of the
outstanding Term Loans. The Loan Agreement contains customary
representations, warranties and covenants.
The Company is required to have cash on deposit at Silicon Valley
Bank equal to the greater of (a) $48.0 million and (b) the "Monthly
Cash Burn," which is defined as the difference of (1)(i) net loss
plus (ii) unfinanced capital expenditures minus (2)(i) depreciation
and amortization expenses, (ii) non-cash stock compensation expense
and (iii) other non-cash expenses as approved by Silicon Valley
Bank. If at any time the Company's aggregate balances at Silicon
Valley Bank are less than the foregoing, the Company is required to
deposit at Silicon Valley Bank cash collateral in an amount equal
to the outstanding Term A Loan. The Term Loans are secured by
substantially all of the Company's assets, except for its
intellectual property which is subject to a negative pledge and
certain other customary exclusions.
About Achaogen, Inc.
South San Francisco, California-based Achaogen, Inc. --
http://www.achaogen.com/-- is a biopharmaceutical company
committed to the discovery, development, and commercialization of
novel antibacterials to treat multi-drug resistant gram-negative
infections. The Company is developing plazomicin, its lead product
candidate, for the treatment of serious bacterial infections due to
MDR Enterobacteriaceae, including carbapenem-resistant
Enterobacteriaceae. In 2013, the Centers for Disease Control and
Prevention identified CRE as a "nightmare bacteria" and an
immediate public health threat that requires "urgent and aggressive
action."
Achaogen incurred a net loss of $125.6 million in 2017, a net loss
of $71.22 million in 2016 and a net loss of $27.09 million in 2015.
As of June 30, 2018, Achaogen had $142.7 million in total assets,
$73.78 million in total liabilities, $10 million in contingently
redeemable common stock, and $58.91 million in total stockholders'
equity.
As of June 30, 2018, the Company had working capital of $86.0
million and unrestricted cash, cash equivalents and short-term
investments of $100.5 million. Based on the Company's available
cash resources, the Company does not have sufficient funds to
support current operations for at least the next twelve months from
Aug. 6, 2018. Achaogen said this condition results in the
assessment that there is substantial doubt about its ability to
continue as a going concern.
ACIS CAPITAL: Plan Outline Okayed, Plan Hearing on Dec. 11
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The U.S. Bankruptcy Court for the Northern District of Texas will
consider approval of the joint Chapter 11 plan for Acis Capital
Management, LP and Acis Capital Management GP, LLC at a hearing on
Dec. 11, at 9:30 a.m.
The hearing will be held at the Earle Cabell Federal Building,
Courtroom 1.
The court will also consider at the hearing the final approval of
the companies' disclosure statement, which it conditionally
approved on Oct. 25.
The order set a Nov. 26 deadline for creditors to file their
objections and submit ballots of acceptance or rejection of the
plan.
General unsecured creditors of the companies will recover 102% of
their claims under the plan, according to the companies' latest
disclosure statement filed on Oct. 25.
The companies' initial plan filed on Sept. 28 estimated the claims
recovery for general unsecured creditors at 103%.
According to the filing, each creditor holding Class 3 general
unsecured claims will receive a promissory note issued by the
reorganized company on the later of (i) that date that is as soon
as practicable after the effective date, or (ii) that date that is
as soon as practicable after the claim is allowed. Each note will
be dated as of the effective date, bear interest at the plan rate
and will mature on that date that is three years after the
effective date.
The companies estimated the total amount of Class 3 general
unsecured claims at $1,341,429.37.
A copy of the disclosure statement dated Oct. 25 is available for
free at:
http://bankrupt.com/misc/txnb18-30264-661.pdf
A copy of the disclosure statement dated Oct. 3 from
PacerMonitor.com is available at https://tinyurl.com/y9hdv5mq at no
charge.
About Acis Capital Management
On Jan. 30, 2018, Joshua N. Terry, as petitioning creditor, filed
an involuntary petition against Acis Capital Management, L.P.,
thereby initiating the Acis LP bankruptcy case. Mr. Terry, as
petitioning creditor, also filed an involuntary petition against
Acis Capital Management GP, thereby initiating the Acis GP
bankruptcy case.
On April 13, 2018, after six days of testimony and argument, the
Bankruptcy Court entered its findings of fact and conclusions of
law in support of orders for relief on the involuntary bankruptcy
petitions.
Also on April 13, 2018, Diane Reed was appointed as interim Chapter
7 trustee for the Debtors' bankruptcy estates. On April 18, 2018,
the Court entered its order directing that the Cases be jointly
administered under Case No. 18-30264 (Bankr. N.D. Tex.).
The Hon. Stacey G. Jernigan presides over the cases.
On May 4, 2018, the Chapter 7 Trustee filed a motion to convert the
cases to Chapter 11. On May 11, 2018, the Court entered an order
granting the Conversion Motion.
On May 14, 2018, the United States Trustee appointed Robin Phelan
as Chapter 11 trustee of the Debtors. Phelan hired Forshey &
Prostok, LLP as counsel; Winstead PC, as special counsel; and
Miller Buckfire & Co., LLC and Stifel, Nicolaus & Co., Inc., each a
wholly-owned subsidiary of Stifel Financial Corp., as their
financial advisors and investment bankers.
ADVANTAGE SALES: Bank Debt Trades at 17% Off
--------------------------------------------
Participations in a syndicated loan under which Advantage Sales &
Marketing is a borrower traded in the secondary market at 83.00
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 1.70 percentage points from the
previous week. Advantage Sales pays 650 basis points above LIBOR to
borrow under the $76 million facility. The bank loan matures on
July 25, 2022. Moody's rates the loan 'Caa1' and Standard & Poor's
gave a 'CCC+' rating to the loan. 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 Friday,
October 26.
ADVANTAGE TENNIS: Seeks Authorization to Use Cash Collateral
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Advantage Tennis, LLC, asks the U.S. Bankruptcy Court for the
District of New Jersey to authorize its use of the lenders' cash
collateral in accordance with the DIP Budget.
The Debtor requires the use of the Lenders' cash collateral to
operate its business in the ordinary course to enable it to
continue to operate and file and confirm a plan of reorganization.
By virtue of an SBA Loan, Northeast Ban holds a security agreement
as to all personal property used in connection with the Debtor's
business including cash, accounts receivable inventory and
equipment. The outstanding balance of the obligation secured by
the Debtor's assets is alleged to be approximately $1,100,000.
The Debtor claims that Northeast Bank loan is current, and it pays
Northeast Bank approximately $6,800 per month. The Debtor concedes
that Northeast Bank has a perfected security interest in its cash
and accounts receivable as well as inventory, equipment, and
furniture and fixtures.
In addition to the financing facility with Northeast Bank, in
August 2018 the Debtor entered into a Business Loan and Security
Agreement with American Express National Bank. The Debtor borrowed
$73,000 from American Express and the funds were deposited into the
Debtor's operating account in September 2018 and used in connection
with the Debtor's business. The Debtor granted American Express a
security interest in all its assets subordinate to the security
interest held by Northeast Bank.
The Debtor proposes to give each Lender a replacement lien on its
post-petition assets including those assets covered by the
prepetition liens and a super-priority administrative expense claim
in accordance with Section 507(b) of the Bankruptcy Code to the
extent the adequate protection provided proves inadequate.
In addition, the Lenders will each be paid its normal monthly
payment of principal and interest as adequate protection payments
during the course of the Chapter 11 proceeding. The Debtor requests
that all such payments be applied in accordance with the terms of
the prepetition loan agreement at the regular non-default interest
rate. The Debtor has requested that the Lenders consent to its use
of cash collateral but has received no response as of the date of
filing of the Motion.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/njb18-30214-11.pdf
About Advantage Tennis
Advantage Tennis LLC has a leasehold interest in a tennis facility
located at 99 Clarksville Road, Princeton, New Jersey valued by the
company at $1.9 million.
Advantage Tennis LLC, based in Cranbury, NJ, filed a Chapter 11
petition (Bankr. D.N.J. Case No. 18-30214) on Oct. 10, 2018. In
the petition signed by Frank Marckioni, member, the Debtor
disclosed $1,935,355 in assets and $2,028,451 in liabilities.
David L. Bruck, Esq., at Greenbaum Rowe Smith & Davis LLP, serves
as bankruptcy counsel.
AGILE THERAPEUTICS: Cash Expected to Fund Operations Into Q2 2019
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Agile Therapeutics, Inc., reported financial results for the three
and nine months ended Sept. 30, 2018 and provided a corporate
update.
Third quarter 2018 and other recent corporate developments:
Twirla Update - As previously announced, Agile initiated
formal dispute resolution with the U.S. Food and Drug
Administration's (FDA) Office of Drug Evaluation III (ODE III)
on June 6, 2018 to appeal the complete response letter (CRL)
the FDA issued in December 2017 relating to the New Drug
Application (NDA) for Twirla (AG200-15), the Company's
investigational non-daily, low-dose combination hormonal
contraceptive patch. In October 2018, the FDA's Office of New
Drugs (OND) formally denied the Company's appeal and provided
a path forward for resubmission of the NDA for Twirla that may
not require that the Company reformulate Twirla or conduct a
bioequivalence study between formulations, as previously
suggested by the FDA's Division of Bone, Reproductive and
Urologic Products, (DBRUP).
Specifically, OND suggested that the Company conduct a wear
study to evaluate whether Twirla demonstrates a generally
similar adhesion performance to Xulane, the generic version of
the previously marketed Ortho Evra contraceptive patch, a
product the FDA considers to have acceptable adhesion. If
this result is demonstrated, OND stated that the study would
support the conclusion of adequate Twirla adhesion. OND has
recommended that the Company meet with DBRUP to gain agreement
on the specific design and success criteria of a wear study
for Twirla. The Company has submitted a request for a Type A
meeting and plans to discuss the specifics of the proposed
wear study with the FDA at that meeting. The wear study
suggested by OND provides a path forward for resubmission of
the Twirla NDA, but is not intended to address efficacy.
Rather if the wear study is successful, Twirla's safety and
efficacy, including the Pearl Index that FDA noted is
substantially higher than other previously approved combined
hormonal contraceptives, will need to be reviewed by FDA after
the Company resubmits the NDA for Twirla. This is an issue
the FDA plans to bring to an Advisory Committee after the
adhesion issue has been resolved.
"We are pleased that the FDA has provided us with a potential path
forward for resubmitting our NDA for Twirla and are moving forward
with our plans to meet with the Agency to discuss the specifics of
the proposed comparative wear study," said Al Altomari, chairman
and chief executive officer of Agile. "Our immediate goal is to
complete the comparative wear study as soon as possible, and, upon
successful completion of that study, to focus on the resubmission
of our NDA. We continue to believe that Twirla, if approved, will
provide women with an important contraception option they do not
currently have -- a once-weekly contraceptive patch designed to
deliver a low dose of estrogen."
Third Quarter Financial Results
* As of Sept. 30, 2018, Agile had $16.9 million of cash and
cash equivalents compared to $35.9 million of cash and cash
equivalents as of Dec. 31, 2017. The Company believes its
cash and cash equivalents as of Sept. 30, 2018, will be
sufficient to meet its projected operating requirements into
the second quarter of 2019, which include an estimate of the
costs to complete a comparative wear study. The Company
anticipates providing a further business update after it
agrees with the FDA on the parameters of the wear study for
Twirla. The Company will require additional capital to fund
operating needs for the remainder of the second quarter of
2019 and beyond, including among other items, preparation for
an anticipated Advisory Committee meeting, the completion of
its commercial plan for Twirla, which primarily includes
validation of the commercial manufacturing process and the
commercial launch of Twirla, if approved, and advancing the
development of its other potential product candidates.
* Research and development expenses were $1.6 million for the
quarter ended Sept. 30, 2018, compared to $3.2 million for
the comparable period in 2017. The decrease in R&D expenses
was primarily due to a decrease in manufacturing and
commercialization expenses reflecting reduced activity
associated with the scale-up process and the on-going
qualification process of the commercial manufacturing
equipment primarily as a result of the receipt of the 2017
CRL.
* General and administrative expenses were $1.8 million for the
quarter ended Sept. 30, 2018, compared to $3.5 million for
the comparable period in 2017. The decrease in G&A expenses
was primarily due to the suspension of pre-commercialization
activities as a result of the receipt of the CRL in December
2017.
* Net loss was $3.8 million, or $0.11 per share, for the
quarter ended Sept. 30, 2018, compared to a net loss of
$7.1 million, or $0.22 per share, for the quarter ended
Sept. 30, 2017.
* At Sept. 30, 2018, Agile had 34,377,329 shares of common
stock outstanding.
A full-text copy of the press release is available for free at:
https://is.gd/qMpUuW
About Agile Therapeutics
Agile Therapeutics, headquartered in Princeton, New Jersey --
http://www.agiletherapeutics.com/-- is a forward-thinking women's
healthcare company dedicated to fulfilling the unmet health needs
of today's women. The Company's product candidates are designed to
provide women with contraceptive options that offer freedom from
taking a daily pill, without committing to a longer-acting method.
Its lead product candidate, Twirla, (ethinyl estradiol and
levonorgestrel transdermal system), also known as AG200-15, is a
once-weekly prescription contraceptive patch that has completed
Phase 3 trials. Twirla is based on Agile's proprietary transdermal
patch technology, called Skinfusion, which is designed to provide
advantages over currently available patches and is intended to
optimize patch adhesion and patient wearability.
The report from the Company's independent accounting firm Ernst &
Young LLP, the Company's auditor since 2010, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the Company has suffered
recurring losses from operations, has experienced delays in the
approval of its product candidate and has stated that substantial
doubt exists about the Company's ability to continue as a going
concern.
Agile reported a net loss of $28.30 million in 2017, a net loss of
$28.74 million in 2016 and a net loss of $30.33 million in 2015.
As of June 30, 2018, Agile had $36.60 million in total assets,
$10.35 million in total current liabilities and $26.25 million in
total stockholders' equity.
AGILE THERAPEUTICS: Incurs $3.79 Million Net Loss in Third Quarter
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Agile Therapeutics, Inc., has filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q reporting a
net loss of $3.79 million for the three months ended Sept. 30,
2018, compared to a net loss of $7.10 million for the same period
last year.
For the nine months ended Sept. 30, 2018, the Company reported a
net loss of $15.96 million compared to a net loss of $22.06 million
for the nine months ended Sept. 30, 2017.
As of Sept. 30, 2018, Agile Therapeutics had $31.59 million in
total assets, $8.41 million in total current liabilities and $23.18
million in total stockholders' equity.
At Sept. 30, 2018, the Company had cash and cash equivalents
totaling $16.9 million. The Company invests its cash equivalents
in short-term highly liquid, interest-bearing investment-grade and
government securities in order to preserve principal.
The Company has incurred significant costs in the area of research
and development, including CRO fees, manufacturing, regulatory and
other clinical trial costs, as its lead product candidate, Twirla,
was being developed. Net cash used in operating activities was
$13.8 million for the nine months ended Sept. 30, 2018 and
consisted primarily of a net loss of $16.0 million, which was
offset by non-cash stock-based compensation expense of $2.8
million, non-cash interest expense of $0.4 million and a decrease
in working capital of $1.0 million. Net cash used in operating
activities was $18.8 million for the nine months ended September
30, 2017 and consisted primarily of a net loss of $22.1 million
which was offset by non-cash stock-based compensation expense of
$2.7 million and non-cash interest expense of $0.5 million. Cash
used in operations in 2018 has been offset, in part, by the
proceeds received from the sale of New Jersey NOLs under the
Program. The decreased clinical development expenses were offset
by increased commercial development and commercial manufacturing
expenses related to the initialization of pre-commercialization
activities for Twirla.
Net cash used in investing activities for the nine months ended
Sept. 30, 2018 and 2017 was $0.3 million and $0.8 million,
respectively. Cash used in investing activities for these periods
primarily represents the acquisition of equipment to be used in the
commercialization of Twirla, if approved.
Net cash used in financing activities for the nine months ended
Sept. 30, 2018 was $4.9 million which primarily represented
principal payments under the Hercules Loan Agreement, which began
on Feb. 1, 2017. Net cash provided by financing activities for the
nine months ended Sept. 30, 2017 was $14.6 million which primarily
represented net proceeds of $18.5 million received from our
follow-on offering of common stock offset, in part, by principal
payments under the Hercules Loan Agreement of $4.1 million.
"We have never been profitable and do not expect to be profitable
in the foreseeable future," the Company stated in the Quarterly
Report. "We have no products approved for commercial sale and to
date have not generated any revenue from product sales. Our
ability to generate revenue and become profitable depends upon our
ability to successfully complete the development of and obtain the
necessary regulatory approvals for our product candidates. We have
been engaged in developing Twirla and our Skinfusion technology
since our inception. To date, we have not generated any revenue
from Twirla, and we may never be able to obtain regulatory approval
for the marketing of Twirla. Further, even if we are able to gain
approval for and commercialize Twirla or any other potential
product candidate, there can be no assurance that we will generate
significant revenues or ever achieve profitability. Our ability to
generate product revenue depends on a number of factors, including
our ability to:
* Successfully complete development of, and receive regulatory
approval for Twirla and our other potential product
candidates;
* Obtain additional capital for the commercial scale-up of
Twirla manufacturing process and commercial launch of Twirla,
if approved, as well as advancing the development or our
other potential product candidates;
* Set an acceptable price for our products, if approved, and
obtain adequate coverage and reimbursement from third party
payors;
* Obtain commercial quantities of our products, if approved, at
acceptable cost levels from our third party manufacturer; and
* Successfully market and sell our products, if approved, in
the United States and abroad.
"In addition, because of the numerous risks and uncertainties
associated with product candidate development, we are unable to
predict the timing or amount of increased expenses, or when, or if,
we will be able to achieve or maintain profitability. In addition,
our expenses could increase beyond our current expectations and
resources if we are required by the FDA or other regulatory
authorities to perform studies or conduct additional work to
support regulatory approval in addition to those that we currently
anticipate. Even if our product candidates are approved for
commercial sale, we anticipate incurring significant costs
associated with the commercial launch of these products.
"Our ability to become and remain profitable depends on our ability
to generate revenue. Even if we are able to generate revenues from
the sale of our products, if approved, we may not become profitable
and may need to obtain additional funding to continue operations.
If we fail to become profitable or obtain additional funding, or
are unable to sustain profitability on a continuing basis, then we
may be unable to continue our operations at planned levels and be
forced to reduce our operations. Even if we do achieve
profitability, we may not be able to sustain or increase
profitability on a quarterly or annual basis. Our failure to
become and remain profitable would decrease the value of our
company and could impair our ability to raise capital, expand our
business or continue our operations. A decline in the value of our
company could also cause you to lose all or part of your
investment."
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/QFCbDm
About Agile Therapeutics
Agile Therapeutics, headquartered in Princeton, New Jersey --
http://www.agiletherapeutics.com/-- is a forward-thinking women's
healthcare company dedicated to fulfilling the unmet health needs
of today's women. The Company's product candidates are designed to
provide women with contraceptive options that offer freedom from
taking a daily pill, without committing to a longer-acting method.
Its lead product candidate, Twirla, (ethinyl estradiol and
levonorgestrel transdermal system), also known as AG200-15, is a
once-weekly prescription contraceptive patch that has completed
Phase 3 trials. Twirla is based on Agile's proprietary transdermal
patch technology, called Skinfusion, which is designed to provide
advantages over currently available patches and is intended to
optimize patch adhesion and patient wearability.
The report from the Company's independent accounting firm Ernst &
Young LLP, the Company's auditor since 2010, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the Company has suffered
recurring losses from operations, has experienced delays in the
approval of its product candidate and has stated that substantial
doubt exists about the Company's ability to continue as a going
concern.
Agile reported a net loss of $28.30 million in 2017, a net loss of
$28.74 million in 2016 and a net loss of $30.33 million in 2015.
AGILE THERAPEUTICS: May Issue 3.86 Mil. Shares Under Incentive Plan
-------------------------------------------------------------------
Agile Therapeutics, Inc. has filed a Form S-8 registration
statement with the Securities and Exchange Commission to register
3,867,454 shares of common stock which are issuable pursuant to the
Company's Amended and Restated 2014 Incentive Compensation Plan.
The Shares are securities of the same class and relate to the same
employee benefit plan, the 2014 Incentive Compensation Plan, as
amended and restated on June 7, 2018, as those registered pursuant
to the Company's registration statements on Form S-8, previously
filed with the SEC on Oct. 17, 2014, June 19, 2015, March 9, 2016,
and May 9, 2017. A full-text copy of the prospectus is available
for free at https://is.gd/pVVJgT
About Agile Therapeutics
Agile Therapeutics, headquartered in Princeton, New Jersey --
http://www.agiletherapeutics.com/-- is a forward-thinking women's
healthcare company dedicated to fulfilling the unmet health needs
of today's women. The Company's product candidates are designed to
provide women with contraceptive options that offer freedom from
taking a daily pill, without committing to a longer-acting method.
Its lead product candidate, Twirla, (ethinyl estradiol and
levonorgestrel transdermal system), also known as AG200-15, is a
once-weekly prescription contraceptive patch that has completed
Phase 3 trials. Twirla is based on Agile's proprietary transdermal
patch technology, called Skinfusion, which is designed to provide
advantages over currently available patches and is intended to
optimize patch adhesion and patient wearability.
The report from the Company's independent accounting firm Ernst &
Young LLP, the Company's auditor since 2010, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the Company has suffered
recurring losses from operations, has experienced delays in the
approval of its product candidate and has stated that substantial
doubt exists about the Company's ability to continue as a going
concern.
Agile reported a net loss of $28.30 million in 2017, a net loss of
$28.74 million in 2016 and a net loss of $30.33 million in 2015.
As of Sept. 30, 2018, Agile Therapeutics had $31.59 million in
total assets, $8.41 million in total current liabilities and $23.18
million in total stockholders' equity.
AGILE THERAPEUTICS: Will Sell $100 Million Worth of Securities
--------------------------------------------------------------
Agile Therapeutics has filed with the Securities and Exchange
Commission a Form S-3 registration statement relating to the offer
and sale from time to time of shares of common stock, shares of
preferred stock, warrants, debt securities and rights to purchase
common stock, preferred stock, debt securities or units, as well as
units that include any of these securities. The Company may sell
any combination of these securities in one or more offerings with
an aggregate offering price of up to $100,000,000.
The Company's common stock is listed on the Nasdaq Global Market
under the symbol "AGRX." On Nov. 1, 2018, the closing price of its
common stock was $0.92.
The aggregate market value of the Company's outstanding common
shares held by non-affiliates as of Nov. 1, 2018 was approximately
$31.2 million based on 34,377,329 shares of common stock
outstanding, of which 33,953,593 were held by non-affiliates, and a
closing price on The Nasdaq Global Market of $0.92 (the closing
price on Nov. 1, 2018).
Agile Therapeutics will use the net proceeds from the sale of the
securities for general corporate purposes, which include, but are
not limited to, providing financing for clinical trials, capital
expenditures, additions to working capital, seeking regulatory
approval for Twirla, the commercial launch of Twirla, if and when
it receives regulatory approval, scaling and validating its
manufacturing process for commercial launch of Twirla, development
of our product candidate pipeline including Twirla line extensions,
general and administrative expenses or other corporate obligations.
The Company may use a portion of the net proceeds to pay off
outstanding indebtedness, if any, and/or acquire or invest in
businesses, products and technologies.
A full-text copy of the prospectus is available for free at:
https://is.gd/jAqygG
About Agile Therapeutics
Agile Therapeutics, headquartered in Princeton, New Jersey --
http://www.agiletherapeutics.com/-- is a forward-thinking women's
healthcare company dedicated to fulfilling the unmet health needs
of today's women. The Company's product candidates are designed to
provide women with contraceptive options that offer freedom from
taking a daily pill, without committing to a longer-acting method.
Its lead product candidate, Twirla, (ethinyl estradiol and
levonorgestrel transdermal system), also known as AG200-15, is a
once-weekly prescription contraceptive patch that has completed
Phase 3 trials. Twirla is based on Agile's proprietary transdermal
patch technology, called Skinfusion, which is designed to provide
advantages over currently available patches and is intended to
optimize patch adhesion and patient wearability.
The report from the Company's independent accounting firm Ernst &
Young LLP, the Company's auditor since 2010, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the Company has suffered
recurring losses from operations, has experienced delays in the
approval of its product candidate and has stated that substantial
doubt exists about the Company's ability to continue as a going
concern.
Agile reported a net loss of $28.30 million in 2017, a net loss of
$28.74 million in 2016 and a net loss of $30.33 million in 2015.
As of Sept. 30, 2018, Agile Therapeutics had $31.59 million in
total assets, $8.41 million in total current liabilities and $23.18
million in total stockholders' equity.
AMERICAN DENTAL: S&P Affirms 'B-' ICR, Outlook Stable
-----------------------------------------------------
S&P Global Ratings affirmed its 'B-' issuer credit rating on
American Dental Partners Inc. The outlook is stable.
S&P said, "At the same time, we affirmed the 'B-' issue-level
rating and '3' recovery rating on American Dental's senior secured
first-lien credit facility, consisting of a $36 million first-lien
revolver and $202.4 million first-lien term loan. The '3' recovery
rating indicates our expectations for meaningful (50%-70%; rounded
estimate: 55%) recovery."
ADPI's proposed leverage-neutral refinancing of its first-lien
facility extends the maturity of the revolver and first-lien term
loan to March 2023 from August 2019 and August 2021, respectively.
This transaction alleviates concerns about liquidity stemming from
the approaching maturity on the currently drawn revolver. S&P
expects the new revolver to be undrawn at close.
S&P Global Ratings' stable outlook on ADPI reflects its base-case
scenario of low–single-digit percentage revenue growth and
slightly improving EBITDA margins, with growth primarily coming
from acquired practices and the rampup of de novo sites. S&P
expects the company to focus more on acquisitions than on de novo
activities.
AMERICAN TIRE: Bank Debt Trades at 11% Off
------------------------------------------
Participations in a syndicated loan under which American Tire
Distributors Inc. is a borrower traded in the secondary market at
89.15 cents-on-the-dollar during the week ended Friday, October 26,
2018, according to data compiled by LSTA/Thomson Reuters MTM
Pricing. This represents a decrease of 0.78 percentage points from
the previous week. American Tire pays 425 basis points above LIBOR
to borrow under the $72 million facility. The bank loan matures on
October 1, 2021. Moody's withdrew the rating of the loan and
Standard & Poor's gave a 'D' rating to the loan. 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 Friday, October 26.
AMICIZIA LLC: Seeks Authorization to Use Cash Collateral
--------------------------------------------------------
Amicizia LLC seeks authorization from the U.S. Bankruptcy Court for
the Northern District of Texas to use cash collateral in the
ordinary course of its business to the extent provided in the
proposed budget.
The Debtor intends to rearrange its affairs and needs to continue
to operate in order to pay its ongoing expenses, generate
additional income and to propose a plan in this case. The Debtor
has an immediate need to use the cash collateral of Meadows Bank --
the Debtor's secured creditor claiming liens on its personal
property including rents.
The Debtor believes Meadows Bank may claim that substantially all
of Meadows Bank's assets are subject to the Prepetition Liens of
Meadows Bank.
The Debtor proposes to use cash collateral to continue its ongoing
operations of the MidiCi Restaurant of Uptown Dallas located at
3699 McKinney Avenue, Suite 106B, Dallas, Texas. The Proposed
2-Week Budget shows total expenses of approximately $19,669. It
permits the payment of ongoing operating expenses of the Debtor in
order to allow the Debtor to maintain its operations in Chapter 11.
The Debtor asserts that it can adequately protect the interests of
Meadows Bank by:
(a) granting Meadows Bank valid, binding, enforceable, and
perfected liens co-extensive with Meadows Bank's pre-petition liens
in all currently owned or hereafter acquired property and assets of
the Debtor, of any kind or nature, whether real or personal,
tangible or intangible, wherever located, now owned or hereafter
acquired or arising and all proceeds and products, including,
without limitation, all accounts receivable, general intangibles,
inventory, and deposit accounts coextensive with its pre-petition
liens;
(b) granting replacement liens and security interests, in
accordance with Bankruptcy Code Sections 361, 363, 364(c)(2),
364(e), and 552, co-extensive with Meadows Bank's prepetition liens
for the diminution in value of the interests of the Meadows Bank;
and
(c) accounting each month to Meadows Bank for all funds
received.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/txnb18-33380-3.pdf
About Amicizia LLC
Amicizia LLC, doing business as MidiCi of Uptown Dallas, is a
privately held company in Dallas, Texas, in the restaurant
business.
Amicizia LLC filed a Chapter 11 petition (Bankr. N.D. Tex. Case No.
18-33380) on Oct. 15, 2018. In the petition signed by Steven Kuy,
managing member, the Debtor estimated up to $50,000 in assets and
$1 million to $10 million in liabilities. The case is assigned to
Judge Barbara J. Houser. The Debtor is represented by Joyce W.
Lindauer, Esq. at Joyce W. Lindauer Attorney, PLLC.
ANIMIS FOUNDATION: Voluntary Chapter 11 Case Summary
----------------------------------------------------
Debtor: Animis Foundation, Inc.
1111 Ritz Carlton Drive #1204
Sarasota, FL 34236
Business Description: Animis Foundation, Inc. is a non-profit
organization that operates an animal rescue
sanctuary in Sarasota, Florida.
Chapter 11 Petition Date: November 2, 2018
Court: United States Bankruptcy Court
Middle District of Florida (Tampa)
Case No.: 18-09515
Debtor's Counsel: Benjamin G. Martin, Esq.
LAW OFFICES OF BENJAMIN MARTIN
1620 Main Street, Suite 1
Sarasota, FL 34236
Tel: 941-951-6166
Fax: 941-951-2076
E-mail: skipmartin@verizon.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Christiaan Walhof, president.
The Debtor stated it has no unsecured creditors.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/flmb18-09515.pdf
ATD CORP: Sailun Jinyu Leaves Creditors' Committee
--------------------------------------------------
Sailun Jinyu Group, Ltd. is no longer a member of the official
committee of unsecured creditors in the Chapter 11 cases of ATD
Corporation and its affiliates, according to an Oct. 31 notice
filed by the Office of the U.S. Trustee with the U.S. Bankruptcy
Court for the District of Delaware.
The remaining members of the committee are Continental Tire The
Americas, LLC, Cooper tire & Rubber Company, Michelin North
America, Inc., Sumitomo Rubber of North America, Pirelli Tire LLC
and Ryder Truck Rental.
About ATD Corp/American Tire
Headquartered in Huntersville, North Carolina, ATD Corporation and
its subsidiaries -- https://www.atd-us.com -- are distributors of
replacement tires with more than 140 distribution centers and 1,400
delivery vehicles servicing a geographic region covering more than
90 percent of the replacement tire market for passenger vehicles
and light trucks in the United States. ATD offers the broadest
variety of products and value-added services that range from
premium-quality tires and popular custom wheels to business support
services and online platforms that cater to tire retailers and
their potential customers. ATD has its own proprietary
private-label and exclusive tire brands, such as Hercules and
Ironman, to supplement its supply of industry-leading brand-name
tires, including Continental, Michelin, Pirelli, Cooper, Nexen,
Toyo-Nitto, Hankook, Kumho, and Falken among others. The Debtors
and their non-Debtor subsidiaries currently employ approximately
5,500 people in the United States and Canada.
ATD Corporation and eight of its affiliates filed for bankruptcy on
Oct. 4, 2018 (Bankr. D. Del. Lead Case No. 18-12221). In the
petition signed by CFO William Williams, the Debtors estimated
assets and liabilities of $1 billion to $10 billion.
The Hon. Kevin J. Carey presides over the cases.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as general bankruptcy counsel; Pachulski Stang
Ziehl & Jones LLP as local bankruptcy counsel; Moelis & Company as
financial advisor; AlixPartners LLP as restructuring advisor; and
Kurtzan Carson Consultants, LLC as notice and claims agent.
Andrew Vara, acting U.S. trustee for Region 3, appointed an
official committee of unsecured creditors on October 19, 2018.
ATLANTIC CITY: Moody's Hikes Issuer Rating to B2, Outlook Positive
------------------------------------------------------------------
Moody's Investors Service has upgraded the City of Atlantic City,
NJ's Long-Term Issuer Rating to B2 from Caa3. The outlook remains
positive. Concurrently, Moody's has affirmed the Baa1 enhanced
rating on the city's Municipal Qualified Bond Act enhanced debt.
The outlook on the enhanced program remains stable. The issuer
rating is equivalent to the city's hypothetical general obligation
unlimited tax rating; there is no rated debt currently associated
with this security.
RATINGS RATIONALE
The B2 Long-Term Issuer Rating reflects the city's continued,
albeit reduced, financial and economic distress. The rating
incorporates the successful implementation of the casino PILOT
program, the recent health of the casino industry and the ongoing
efforts to diversify the tax base. The rating is also informed by
the material budgetary improvements and especially by the
continued, strong oversight by the State of New Jersey (A3 stable).
The Baa1 enhanced rating and stable outlook reflects the
enhancement provided by the Municipal Qualified Bond Program, a
state aid intercept program, and is notched once off the State of
New Jersey's rating.
RATING OUTLOOK
The positive outlook on the city's Long-Term Issuer Rating reflects
the material progress made by city in collaboration with the state,
most notably the tax appeal settlements and budgetary improvements.
The stable outlook on the Municipal Qualified Bond Program enhanced
debt matches the state's stable outlook which reflects that the
current A3 rating of the state is well positioned for the next
12-18 months due to solid economic performance and improved budget
flexibility in fiscal 2019. However, in the longer term, the
state's credit profile will continue to weaken as large long-term
liabilities grow and the state's budget is challenged by growing
pension contributions in a low revenue growth environment.
FACTORS THAT COULD LEAD TO AN UPGRADE (UNDERLYING AND ENHANCED)
- Improved liquidity and reserve position (underlying rating
only)
- Further reductions in expenditures (underlying rating only)
- Diversification of the economic base (underlying rating only)
- Material improvement in tax base and resident wealth and income
(underlying rating only)
- Improvement in the State of New Jersey's GO rating (enhanced
rating only)
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Further contraction in the casino industry (underlying rating
only)
- Failure to adopt adequate budget solutions (underlying rating
only)
- Deterioration of already strained liquidity and reserves
(underlying rating only)
- Default on debt obligations (underlying rating and enhanced
rating)
- Withdrawal of state oversight (underlying rating only)
- Downgrade in the State of New Jersey's GO rating (enhanced
rating only)
LEGAL SECURITY
The long-term issuer rating is equivalent to the city's theoretical
general obligation unlimited ad valorem tax pledge. Certain
issuances are also secured by the MQBA program.
As of the latest issuance, Atlantic City's debt has a unique
security feature related to the monies derived from the Investment
Alternative Tax. This money is being specifically pledged to the
city's debt as an addition to the current GO and, for certain
issuances, MQBA pledges. This money will be accumulated and, if
sufficient, will be used to pay debt service in place of state aid
or other revenue sources. Funds will be used in the following
order: current year MQBA debt service, current year non-MQBA debt
service, subsequent year MQBA debt service, subsequent year
non-MQBA debt service, and, finally, to build a reserve for paying
down debt ahead of schedule. This extra security in no fashion
interferes with the fundamental MQBA structure which remains in
place.
The primary advantage of this structure is the freeing up of state
aid. Although the money might seem fungible, thus rendering this
structure somewhat superfluous, the IAT money is actually
restricted. This structure allows the restricted funds to be
swapped for the unrestricted funds, increasing the city's
flexibility.
PROFILE
Atlantic City is a tourism and gaming center located along the
south New Jersey shore. It has a population of approximately
39,000.
METHODOLOGY
The principal methodology used in the issuer rating was US Local
Government General Obligation Debt published in December 2016. The
principal methodology used in the enhanced ratings was State Aid
Intercept Programs and Financings published in December 2017.
BEAUTIFUL BROWS: Ameris Bank Objects Further Cash Collateral Use
----------------------------------------------------------------
Ameris Bank filed with the U.S. Bankruptcy Court for the Northern
District of Georgia its objection to Beautiful Brows, LLC's use of
cash collateral in which it has an interest unless and until its
interests are adequately protected.
Ameris Bank holds a valid, fully protected, first priority security
interest on all business assets of the Debtor, including accounts,
equipment, fixtures, instruments, general intangibles, and all
other property described more fully in the following loan
documents:
(A) Loan Agreement between Ameris Bank and (a) Beautiful
Brows, LLC, Debtor, (b) the entity guarantor, Archistic Threading
of Marietta, LLC, and (c) two individual unlimited guarantors, Fnu
Saleema (a/k/a Saleema Delawalla) and Sameera Khatri;
(B) SBA promissory note in the original principal amount of
$679,000 between Ameris Bank and Debtor; and
(C) Security Agreement which give Ameris Bank a
first-in-priority business lien on all of Debtor's business
collateral.
Ameris Bank has accelerated the debt and obtained a Judgment dated
September 11, 2018 in the case entitled Ameris Bank vs. Beautiful
Brows, LLC, Archistic Threading of Marietta, LLC, Sameera Khatri
and Fnu Saleema, State Court of Gwinnett County, Civil Action File
No. 18-C-03099-6 because of Debtor's default making monthly
payments owed to Ameris Bank pursuant to the terms of the Note. The
amount owed on the Judgment as of the Petition Date is
approximately $701,369.
In the same civil action, Ameris Bank obtained a Writ of Possession
and Turnover Order against Defendant Beautiful Brows, LLC for
turnover of all business collateral to it. At the time that Debtor
filed bankruptcy, Ameris Bank had demanded compliance with the Writ
of Possession requiring a turnover of Debtor's Business Collateral.
Ameris Bank asserts that the Note, and the Judgment, are secured
by, among other Business Collateral, Debtor's accounts and accounts
receivables which comprise cash collateral pursuant to 11 U.S.C.
Section 363(a).
Ameris Bank claims that it has not been paid pursuant to the terms
of the Loan Documents since February 15, 2018 or any amounts on the
subsequent Judgment. The monthly payment pursuant to the terms of
the SBA Note which was paid on February 15, 2018 was in the amount
of $7,869.
As part of collection efforts on the Judgment and Writ of
Possession, Debtor produced to Ameris Bank its business bank
statements from February 2017 through August 2018. The bank
statements evidence that while Debtor was not servicing Ameris
Bank's debt, large sums were being paid each month to insiders,
including the guarantors, one of the guarantor's husbands, one of
the guarantor's unrelated companies and several unrelated entities
that are associated with a guarantor's husband. These entities
being paid have all been administratively dissolved by the
Secretary of State of Georgia. Ameris Bank has also determined that
the entity guarantor was administratively dissolved as of September
7, 2018.
Ameris Bank has determined that the Debtor continues to operate its
business locations with Ameris Bank's Business Collateral and Cash
Collateral and pay insiders large sums each month and employees'
salaries on a regular basis. However, adequate protection has not
been and is not being provided to Ameris Bank in connection with
the Cash Collateral and Business Collateral of Debtor.
Ameris Bank demands that the Debtor make an accounting of all
current accounts and accounts receivable being received and of all
other Business Collateral securing Ameris Bank's loan, including
for the personalty the current location and condition. Ameris Bank
further demands that the Court require that Debtor provide an
accounting for its payments from its accounts and accounts
receivables from February 15, 2018 through the Petition Date.
Ameris Bank is represented by:
Lynn L. Carroll, Esq.
GOLDER LAW, LLC
101 Village Parkway
Building 1, Suite 400
Marietta, Georgia 30067
Phone: 404/252-3000
E-mail: lcarroll@golderlawfirm.com
About Beautiful Brows
Beautiful Brows LLC, based in Tucker, Georgia, primarily operates
in the skin care business within the personal services industry.
Beautiful Brows, filed a Chapter 11 petition (Bankr. N.D. Ga. Case
No. 18-66766) on Oct. 3, 2018. In the petition signed by Saleema
Delawalla (f/k/a Fnu Saleema), member, the Debtor estimated
$100,000 to $500,000 in assets and $1 million to $10 million in
liabilities. Jason L. Pettie, Esq., at Jason L. Pettie, P.C.,
serves as bankruptcy counsel.
BEAUTIFUL BROWS: Seeks Authorization to Use Cash Collateral
-----------------------------------------------------------
Beautiful Brows, LLC, seeks authority from the U.S. Bankruptcy
Court for the Northern District of Georgia to use cash collateral
for the purpose of operating its business and meeting the general
and administrative expenses as set forth in the budget.
The proposed budget provides total projected monthly expenses of
approximately $79,660.
The Debtor has an immediate need for the use of cash collateral
necessary to sustain its business as a going concern as it will
provide sufficient working capital while the Debtor operates in
chapter 11. The Debtor urgently needs to use cash collateral for,
among other things, continuing the operation of the company in an
orderly manner, maintaining business relationships with customers,
providing for the payment of employees, and satisfying other
working capital and operational needs -- all of which are vital to
preserving and maintaining the Debtor's going-concern value and,
ultimately, effectuating a successful reorganization for the
benefit of all creditors and parties in interest.
The Debtor is indebted to Ameris Bank pursuant to a revolving line
of credit loan in the original amount of $679,000, secured by
substantially all property of the Debtor, including cash on hand,
accounts receivable, inventory and income derived from the Debtor's
business operations.
The Debtor submits that Ameris Bank is the only lender that may
require adequate protection in this case. The Debtor proposes to
protect the Ameris Bank by providing Ameris Bank with (i)
replacement liens on the Debtor's postpetition assets, and (ii)
cash payments of $4,900 per month, or such lesser amount which from
time to time represents the non-default rate of interest on the
principal debt owed to Ameris Bank.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/ganb18-66766-16.pdf
About Beautiful Brows
Beautiful Brows LLC, based in Tucker, Georgia, primarily operates
in the skin care business within the personal services industry.
Beautiful Brows, filed a Chapter 11 petition (Bankr. N.D. Ga. Case
No. 18-66766) on Oct. 3, 2018. In the petition signed by Saleema
Delawalla (f/k/a Fnu Saleema), member, the Debtor estimated
$100,000 to $500,000 in assets and $1 million to $10 million in
liabilities. Jason L. Pettie, Esq., at Jason L. Pettie, P.C.,
serves as bankruptcy counsel.
BELK INC: Bank Debt Trades at 16% Off
-------------------------------------
Participations in a syndicated loan under which BELK Incorporated
is a borrower traded in the secondary market at 84.50
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 2.31 percentage points from the
previous week. BELK Incorporated pays 475 basis points above LIBOR
to borrow under the $15 million facility. The bank loan matures on
December 10, 2022. Moody's rates the loan 'B2' and Standard &
Poor's gave a 'B-' rating to the loan. 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
Friday, October 26.
BIOSCRIP INC: Reaffirms Guidance for 2019 Adjusted EBITDA of $75M
-----------------------------------------------------------------
BioScrip, Inc. announced that the Centers for Medicare and Medicaid
Services published a final rule on Oct. 31, 2018 for the
implementation of a transitional benefit payment, beginning Jan. 1,
2019, for Medicare Part B home infusion services (the "Cures
Fix").
"The Cures Fix is only one of many positive drivers for our
business in 2019 and beyond. While the Company disagrees with
CMS's interpretation of the law, we now have clarity on the final
rule, and can reaffirm our guidance for Adjusted EBITDA of at least
$75 million in 2019, reflecting our confidence in BioScrip's
underlying business and successful execution across the four key
pillars of our Vision 2020 strategy. We are making significant
progress in the areas of revenue cycle management, supply chain
savings, managed care relationships and core revenue growth," said
Dan Greenleaf, president and chief executive officer of Bioscrip.
"Based on CMS's final rule, we are evaluating the future treatment
of Medicare beneficiaries, while also considering possible next
steps to ensure this new transitional benefit is implemented as
Congress intended."
About BioScrip, Inc.
Headquartered in Denver, Colo., BioScrip, Inc. --
http://www.bioscrip.com/-- is an independent national provider of
infusion and home care management solutions, with approximately
2,100 teammates and nearly 70 service locations across the U.S.
BioScrip partners with physicians, hospital systems, payors,
pharmaceutical manufacturers and skilled nursing facilities to
provide patients access to post-acute care services. BioScrip
operates with a commitment to bring customer-focused pharmacy and
related healthcare infusion therapy services into the home or
alternate-site setting.
BioScrip reported a net loss attributable to common stockholders of
$74.27 million for the year ended Dec. 31, 2017, compared to a net
loss attributable to common stockholders of $51.84 million for the
year ended Dec. 31, 2016.
As of June 30, 2018, Bioscrip had $566.14 million in total assets,
$595.6 million in total liabilities, $3.02 million in series A
convertible preferred stock, $84.46 million in series C convertible
preferred stock, and a total stockholders' deficit of $116.96
million.
* * *
As reported by the TCR on Aug. 1, 2018, Moody's Investors Service
upgraded BioScrip Inc's Corporate Family Rating to 'Caa1' from
'Caa2'. BioScrip's Caa1 Corporate Family Rating reflects the
company's very high leverage and weak liquidity.
Also in August 2018, S&P Global Ratings raised its issuer credit
rating on BioScrip Inc. to 'CCC+' from 'CCC'. "The rating upgrade
reflects our belief that BioScrip will be able to meet its debt
obligations for at least the next 12 months."
BLUE BEE: May Continue Using Cash Collateral Until Jan. 26
----------------------------------------------------------
The Hon. Sandra R. Klein of the U.S. Bankruptcy Court for the
Central District of California authorized Blue Bee, Inc., d/b/a
ANGL, to use cash collateral in accordance with its operating
budget for the 14-week period from October 21, 2018 through and
including January 26, 2019.
The Debtor is authorized to use cash collateral to (i) pay all of
the expenses set forth in the Budget, with authority to deviate
from the line items contained in the Budget by not more than 20%,
on both a line item and aggregate basis, with any unused portions
to be carried over into the following week(s) and (ii) pay all
quarterly fees owing to the Office of the United States Trustee and
all expenses owing to the Clerk of the Bankruptcy Court.
A full-text copy of the Order is available at
http://bankrupt.com/misc/cacb16-23836-394.pdf
About Blue Bee
Headquartered near downtown Los Angeles, California in Vernon,
California, Blue Bee, Inc., doing business as ANGL, is a retailer
doing business under the "ANGL" brand offering stylish and
contemporary women's clothing at reasonable prices to its
fashion-savvy customers. As of Oct. 19, 2016, Blue Bee owns and
operates 21 retail stores located primarily in shopping malls
throughout the state of California. Founders Jeff Sunghak Kim and
his wife, Young Ae Kim, continue to be actively involved in Blue
Bee's business operations as the President and Secretary of the
Company, respectively.
Blue Bee filed a Chapter 11 petition (Bankr. C.D. Cal. Case No.
16-23836) on Oct. 19,2016. Jeff Sungkak Kim, its president, signed
the petition. The Debtor estimated assets and liabilities at $1
million to $10 million. Judge Sandra R. Klein is the case judge.
The Debtor is represented by Juliet Y. Oh, Esq., at Levene, Neale,
Bender, Yoo & Brill LLP.
BOSSLER ROOFING: Exclusive Plan Filing Deadline Moved to Dec. 10
----------------------------------------------------------------
The Hon. Mindy A. Mora of the U.S. Bankruptcy Court for the
Southern District of Florida, at the behest of Bossler Roofing,
Inc., has extended the Debtor's exclusive period to file and to
obtain acceptances of a plan of reorganization through and
including Dec. 10, 2018 and Feb. 8, 2019, respectively.
The Troubled Company Reporter has previously reported that the
Debtor sought extension of the Exclusive Periods in order to allow
it to move forward in an orderly, efficient and cost-effective
manner to maximize the value of its assets. The deadline for
creditors in this case to file proofs of claims was April 9, 2018.
However, the Debtor filed a Motion for Supplemental Bar Date to
allow additional creditors not listed on the initial Schedules to
file a Proof of Claim. In that Motion, the Debtor requested a
supplemental bar date which was set to Sept. 17, 2018. In
addition, the Debtor's counsel has had trouble reaching the Debtor
and has had communication issues with the Debtor to finalize the
plan terms.
About Bossler Roofing
Bossler Roofing, Inc., is a Lake Worth, Florida-based roofing
company owned by Christopher Bossler. The company offers
installation services of all roofing systems, concrete roof tile
restoration, attic radiant and reflective roof coating energy
saving applications, concrete tile and asphalt shingle "Cool Roof"
energy star installations, Henry Roof Certified waterproofing (flat
roof installation) services, Poly-Foam Certified (Metro-Dade County
approved concrete and clay roof tile adhesive application)
installations, and all commercial and residential roof repairs,
from minor to major leak penetrations.
Bossler Roofing, Inc., filed a Chapter 11 petition (Bankr. S.D.
Fla. Case No. 17-24798) on Dec. 12, 2017. In the petition signed
by Christopher Bossler, its president, the Debtor disclosed
$567,055 in assets and $1.06 million in liabilities. This case is
assigned to Judge Paul G. Hyman, Jr. Craig I. Kelley, Esq., at
Kelley & Fulton, P.L., is the Debtor's general counsel.
CALIFORNIA RESOURCES: Posts $66 Million Net Income in 3rd Quarter
-----------------------------------------------------------------
California Resources Corporation has filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q reporting net
income attributable to common stock of $66 million on $828 million
of total revenues and other for the three months ended Sept. 30,
2018, compared to a net loss attributable to common stock of $133
million on $445 million of total revenues and other for the three
months ended Sept. 30, 2017.
For the nine months ended Sept. 30, 2018, the Company reported a
net loss attributable to common stock of $18 million on $1.98
billion of total revenues and other compared to a net loss
attributable to common stock of $128 million on $1.55 billion of
total revenues and other for the same period during the prior
year.
As of Sept. 30, 2018, California Resources had $6.98 billion in
total assets, $871 million in total current liabilities, $5.10
billion in long-term debt, $253 million in deferred gain and
issuance costs, $612 million in other long-term liabilities, $745
million in redeemable noncontrolling interest and a total deficit
of $605 million.
Quarterly Highlights Include:
* Generated core adjusted EBITDAX of $400 million, which
excludes the impact of $79 million of cash settlement
payments on commodity hedge contracts and $13 million of
cash-settled stock-based compensation expense
* Reported adjusted EBITDAX of $308 million, 26% higher than
the prior quarter, and an adjusted EBITDAX margin1 of 38%
* Produced 136,000 BOE per day, which reflects an increase of
6% over the prior year period and the midpoint of the
previous guidance range
* Invested $196 million of total capital of which internally
funded capital was $158 million
* Drilled 59 wells with internally funded capital and 36 wells
with joint venture (JV) capital
* Realized $34 million of annualized synergies after the Elk
Hills acquisition, exceeding the initial $20 million target
well ahead of anticipated pace
* Increased 2018 capital budget to a range of $720 to $750
million, including approximately $100 million of JV funding,
to sustain the increased level of activity through the fourth
quarter
* Issued fourth quarter of 2018 production guidance of 136,000
to 139,000 BOE per day reflecting continued production growth
Todd A. Stevens, CRC's president and chief executive officer, said,
"CRC's value-driven strategy continued to deliver strong results
for the third quarter of 2018, showcasing operational excellence,
strong Brent-based realizations, effective capital deployment and
portfolio de-risking with the execution of two joint ventures.
This resulted in the highest level of quarterly adjusted EBITDAX
since 2014 and demonstrated our ability to deliver positive free
cash flow before working capital on a year-to-date basis. We
remain dedicated to capturing the full value of our conventional
resources and driving production growth from our diverse portfolio
of assets, while strengthening our financial position and
furthering debt reduction efforts. Looking ahead, we are focused
on a strong finish to 2018 and carrying that momentum into 2019."
Operational Update
CRC operated an average of 10 drilling rigs during the third
quarter of 2018 with two rigs focused on steamfloods, four on
waterfloods, two on conventional primary production, one on
unconventional production and one on exploration. CRC drilled 94
development wells and one exploration well with CRC and JV capital
(43 steamflood, 25 waterflood, 18 primary and 9 unconventional).
Steamfloods and waterfloods have different production profiles and
longer response times than typical conventional wells and, as a
result, the full production contribution may not be experienced in
the same period that the well is drilled. In the San Joaquin
basin, CRC operated seven rigs and produced approximately 99,000
BOE per day in the third quarter of 2018. The Los Angeles basin
operated three rigs directed toward waterflood projects and
contributed 26,000 BOE per day of production in the third quarter
of 2018. The Ventura basin produced 6,000 BOE per day and the
Sacramento basin produced 5,000 BOE per day. Neither the Ventura
nor Sacramento basin had active drilling programs in the third
quarter of 2018.
2018 Capital Budget
CRC increased its 2018 capital program to a range of $720 million
to $750 million, which includes approximately $100 million of JV
capital. This increase from the previously stated range of $650
million to $700 million is intended to build on the momentum
created in the first nine months of 2018. The updated program
reflects management's strategy to align the capital program with
stronger expected cash flows from commodity price improvements and
increased production from the Elk Hills acquisition. The
additional capital will sustain current workover and facility
activity through the fourth quarter of 2018.
Debt Reduction Update
CRC continues to deliver on its commitment to strengthen the
balance sheet. In the third quarter of 2018, CRC repurchased a
total of $32 million in aggregate principal amount of the Company's
outstanding debt for $30 million in cash. Through the first nine
months of 2018, CRC repurchased a total of $177 million in
aggregate principal amount of the Company's outstanding debt for
$149 million in cash. The majority of CRC's debt repurchases
focused on the Company's Second Lien Notes.
Borrowing Base Redetermination
Effective October 2018, CRC's borrowing base under its 2014 Credit
Agreement was reaffirmed at $2.3 billion.
Mid-Year Reserves
CRC's mid-year proved reserves totaled 731 MMBOE, up from 618 MMBOE
at year-end 2017. Excluding positive price revisions and additions
related to the Elk Hills acquisition, the Company organically
replaced 96% of proved reserves. This strong organic reserve
replacement ratio (RRR) was achieved with well executed capital
programs in Buena Vista, South Valley, Huntington Beach and Long
Beach. Approximately 23 MMBOE of additions were related to
transfers, revisions, extensions and discoveries and improved
recovery. The Elk Hills acquisition added 63 MMBOE of proved
reserves, in line with the estimate stated at the time of
acquisition.
Hedging Update
CRC continues to opportunistically seek hedging transactions to
protect its cash flow, operating margins and capital program while
maintaining adequate liquidity. For the first and second quarters
of 2019, CRC has protected the downside price risk of approximately
47,000 and 42,000 barrels per day at approximately $65.35 Brent and
$68.91 Brent per barrel, respectively. In the third and fourth
quarters of 2019, the Company protected the downside price risk of
approximately 42,000 and 37,000 barrels per day at approximately
$72.18 and $74.56 Brent per barrel, respectively. Except for a
small portion primarily in the first quarter of 2019, the 2019
hedges do not contain caps, thereby providing upside to oil price
movements.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/mg0uo7
About California Resources
California Resources Corporation -- http://www.crc.com/-- is an
oil and natural gas exploration and production company
headquartered in Los Angeles, California. The Company operates its
resource base exclusively within the State of California, applying
complementary and integrated infrastructure to gather, process and
market its production. Using advanced technology, California
Resources Corporation focuses on safely and responsibly supplying
affordable energy for California by Californians.
California Resources reported a net loss attributable to common
stock of $266 million for the year ended Dec. 31, 2017, compared to
net income attributable to common stock of $279 million for the
year ended Dec. 31, 2016.
* * *
In November 2017, S&P Global Ratings affirmed its 'CCC+' corporate
credit rating on Los Angeles-based exploration and production
company California Resources Corp (CRC). The outlook is negative.
"The affirmation of the 'CCC+' corporate credit rating on CRC
reflects our assessment of the company's improving, but still weak
financial measures combined with increased capital spending that
should stem production declines following a tumultuous 2016."
As reported by the TCR on Nov. 13, 2017, Moody's Investors Service
upgraded California Resources' Corporate Family Rating (CFR) to
'Caa1' from 'Caa2' and Probability of Default Rating (PDR) to
'Caa1-PD' from 'Caa2-PD'. Moody's said the upgrade of CRC's CFR to
'Caa1' and stable outlook reflects CRC's improved liquidity and the
likelihood that it will have sufficient liquidity to support its
operations for at least the next two years at current commodity
prices.
CAMBER ENERGY: Investor Buys $3.5-Mil. Convertible Preferred Stock
------------------------------------------------------------------
Camber Energy, Inc., and an institutional investor entered into a
stock purchase agreement under which the Investor purchased 369
shares of Series C Redeemable Convertible Preferred Stock on the
closing date of the agreement, Oct. 29, 2018, for $3.5 million.
This offering is part of the Company's plans to meet the NYSE
American continued listing obligations and meet working capital
obligations.
The Company plans to use the proceeds from the sale of the Series C
Preferred Stock for working capital, workovers on existing and new
wells and completion of additional wells.
Pursuant to the October 2018 Purchase Agreement, as long as the
Investor holds any shares of Series C Preferred Stock, the Company
agreed that it would not issue or enter into or amend an agreement
pursuant to which it may issue any shares of common stock, other
than (a) for restricted securities with no registration rights, (b)
in connection with a strategic acquisition, (c) in an underwritten
public offering, or (d) at a fixed price; or issue or amend any
debt or equity securities convertible into, exchangeable or
exercisable for, or including the right to receive, shares of
common stock (i) at a conversion price, exercise price or exchange
rate or other price that is based upon or varies with, the trading
prices of or quotations for the shares of common stock at any time
after the initial issuance of the security or (ii) with a
conversion, exercise or exchange price that is subject to being
reset at some future date after the initial issuance of the
security or upon the occurrence of specified or contingent events
directly or indirectly related to the business of the Company or
the market for the common stock.
Additionally, provided that the Company has not materially breached
the terms of the October 2018 Purchase Agreement, the Company may
at any time, in its sole and absolute discretion, repurchase from
Investor all, but not less than all, of the then outstanding shares
of Series C Preferred Stock sold pursuant to the agreement by
paying to Investor 110% of the aggregate face value of all those
shares.
Camber Energy also agreed to provide the Investor a right of first
offer to match any offer for financing the Company receives from
any person while the shares of Series C Preferred Stock sold
pursuant to the October 2018 Purchase Agreement are outstanding,
except for debt financings not convertible into common stock, which
are excluded from such right to match.
Finally, the Company agreed that if it issues any security with any
term more favorable to the holder of such security or with a term
in favor of the holder of such security that was not similarly
provided to Investor, then the Company would notify Investor of
such additional or more favorable term and such term, at Investor's
option, may become a part of the transaction documents with
Investor.
The October 2018 Purchase Agreement includes customary provisions
requiring that the Company indemnify the Investor against certain
losses; representations and warranties and covenants.
Series C Redeemable Convertible Preferred Stock
Holders of the Series C Preferred Stock are entitled to cumulative
dividends in the amount of 24.95% per annum (adjustable up to
34.95% if a trigger event, as described in the designation of the
Series C Preferred Stock occurs), payable upon redemption,
conversion, or maturity, and when, as and if declared by the
Company's Board of Directors in its discretion, provided that upon
any redemption, conversion, or maturity, seven years of dividends
are due and payable on such redeemed, converted or matured stock.
The Series C Preferred Stock ranks senior to the common stock and
pari passu with respect to the Company's Series B Preferred Stock.
The Series C Preferred Stock has no right to vote on any matters,
questions or proceedings of the Company including, without
limitation, the election of directors except: (a) during a period
where a dividend (or part of a dividend) is in arrears; (b) on a
proposal to reduce the Company's share capital; (c) on a resolution
to approve the terms of a buy-back agreement; (d) on a proposal to
wind up the Company; (e) on a proposal for the disposal of all or
substantially all of the Company's property, business and
undertakings; and (f) during the winding-up of the Company.
The Series C Preferred Stock may be converted into shares of common
stock at any time at the option of the holder, or at our option if
certain equity conditions (as defined in the certificate of
designation for the Series C Preferred Stock), are met. Upon
conversion, the Company will pay the holders of the Series C
Preferred Stock being converted an amount, in cash or stock at our
sole discretion, equal to the dividends that such shares would have
otherwise earned if they had been held through the maturity date
(i.e., seven years), and issue to the holders such number of shares
of Common stock equal to $10,000 per share of Series C Preferred
Stock multiplied by the number of such shares of Series C Preferred
Stock divided by the applicable Conversion Price (as defined in the
certificate of designation for the Series C Preferred Stock).
The conversion premium under the Series C Preferred Stock is
payable and the dividend rate under the Series C Preferred Stock is
adjustable. Specifically, the conversion rate of such premiums and
dividends equals 95% of the average of the lowest 5 individual
daily volume weighted average prices during the Measuring Period,
not to exceed 100% of the lowest sales prices on the last day of
the Measuring Period, less $0.05 per share of common stock, unless
a triggering event has occurred, in which case the conversion rate
equals 85% of the lowest daily volume weighted average price during
the Measuring Period, less $0.10 per share of common stock not to
exceed 85% of the lowest sales prices on the last day of such
Measuring Period, less $0.10 per share. The "Measuring Period" is
the period beginning, if no trigger event has occurred, 30 trading
days, and if a trigger event has occurred, 60 trading days, before
the applicable notice has been provided regarding the exercise or
conversion of the applicable security, and ending, if no trigger
event has occurred, 30 trading days, and if a trigger event has
occurred, 60 trading days, after the applicable number of shares
stated in the initial exercise/conversion notice have actually been
received into the Investor's designated brokerage account in
electronic form and fully cleared for trading (subject to certain
extensions described in the applicable securities, which have been
triggered to date). Triggering events are described in the
designation of the Series C Preferred Stock, but include items
which would typically be events of default under a debt security,
including filing of reports late with the Securities and Exchange
Commission.
The Series C Preferred Stock has a maturity date that is seven
years after the date of issuance and, if the Series C Preferred
Stock has not been wholly converted into shares of common stock
prior to such date, the Company may redeem the Series C Preferred
Stock on such date by repaying to the investor in cash 100% of the
Face Value plus an amount equal to any accrued but unpaid dividends
thereon. 100% of the Face Value, plus an amount equal to any
accrued but unpaid dividends thereon, automatically becomes payable
in the event of a liquidation, dissolution or winding up by us.
The Company may not issue any other preferred stock (other than the
Series B Preferred Stock) that is pari passu or senior to the
Series C Preferred Stock with respect to any rights for a period of
one year after the earlier of such date (i) a registration
statement is effective and available for the resale of all shares
of common stock issuable upon conversion of the Series C Preferred
Stock, or (ii) Rule 144 under the Securities Act is available for
the immediate unrestricted resale of all shares of common stock
issuable upon conversion of the Series C Preferred Stock.
The Series C Preferred Stock is subject to a beneficial ownership
limitation, which prevents any holder of the Series C Preferred
Stock from converting such Series C Preferred Stock into common
stock, if upon such conversion, the holder would beneficially own
greater than 9.99% of the Company's outstanding common stock.
The issuance of the Conversion Shares is subject to NYSE American
approval and approval of the Company's shareholders. The Company
agreed, pursuant to the October 2018 Purchase Agreement, to file a
preliminary proxy statement within 30 days after the closing date
to seek stockholder approval of the October 2018 Purchase Agreement
and the issuance of the Conversion Shares under applicable NYSE
American rules and regulations, and to use the Company's
commercially reasonable best efforts to obtain Approval as soon as
practicable.
The Company also agreed to include on the next registration
statement it files with the Commission, or on the subsequent
registration statement if such registration statement is withdrawn,
all potentially issuable Conversion Shares.
Debenture Conversion
On Oct. 31, 2018, the Investor converted the entire $495,000 of
principal owed under the terms of that certain Redeemable
Convertible Subordinated Debenture sold to the Investor by the
Company on April 6, 2016, in the original principal amount of
$530,000, into an aggregate of 20,037,653 shares of common stock,
including 152,308 shares of common stock issuable upon conversion
of the principal amount thereof (at a conversion price of $3.25 per
share), and 19,885,345 shares in connection with conversion
premiums due thereon (at a conversion price, as calculated as
provided in such debenture, of $0.0609 per share). A total of
2,500,000 of such shares were issued to the Investor in connection
with the conversion and the remaining shares are held in abeyance
subject to the Investor's 9.99% ownership limitation, to be issued
from time to time, at the request of the Investor.
The sale and issuance of the securities described above have been
determined to be exempt from registration under the Securities Act
of 1933, as amended in reliance on Sections 3(a)(9) and 4(a)(2) of
the Securities Act, Rule 506 of Regulation D promulgated thereunder
and Regulation S promulgated thereunder, as transactions by an
issuer not involving a public offering. The Investor has
represented that it is an accredited investor, as that term is
defined in Regulation D. The Investor also has represented that it
is acquiring the securities for investment purposes only and not
with a view to or for sale in connection with any distribution
thereof. Additionally, the conversion of the debenture was deemed
exempt from registration pursuant to Section 3(a)(9) of the
Securities Act.
As of Nov. 1, 2018, the Series C Preferred Stock sold on Oct. 29,
2018, would convert into approximately 50,785,501 shares of the
Company's common stock if fully converted, which number includes
45,516 shares of common stock convertible upon conversion of each
share of outstanding Series C Preferred Stock at a conversion price
of $3.25 per share (based on the $10,000 face amount of the Series
C Preferred Stock) and approximately 49,650,116 shares of common
stock for premium shares due thereunder (based on the current
dividend rate of 24.95% per annum), and a conversion price of
$0.1298 per share, which may be greater than or less than the
conversion price that currently applies to the conversion of the
Series C Preferred Stock pursuant to the terms of the designation,
which number of premium shares may increase significantly from time
to time as the trading price of our common stock decreases, upon
the occurrence of any trigger event under the Designation of the
Series C Preferred Stock and upon the occurrence of certain other
events, as described in greater detail in the Designation of the
Series C Preferred Stock.
The conversion of the Series C Preferred Stock into common stock of
the Company will create substantial dilution to existing
stockholders.
As of Oct. 31, 2018, the Company had 114,555,648 shares of common
stock issued and outstanding.
About Camber Energy
Based in San Antonio, Texas, Camber Energy, Inc. (NYSE American:
CEI) -- http://www.camber.energy/-- is an independent oil and gas
company engaged in the development of crude oil, natural gas and
natural gas liquids in the Hunton formation in Central Oklahoma in
addition to anticipated project development in the Texas
Panhandle.
Camber Energy reported a net loss of $24.77 million for the year
ended March 31, 2018, compared to a net loss of $89.12 million for
the year ended March 31, 2017. As of June 30, 2018, the Company
had $14.72 million in total assets, $42.85 million in total
liabilities and a total stockholders' deficit of $28.13 million.
GBH CPAs, PC's audit opinion included in the company's Annual
Report on Form 10-K for the year ended March 31, 2018 contains a
going concern explanatory paragraph stating that the Company has
incurred significant losses from operations and had a working
capital deficit as of March 31, 2018. These factors raise
substantial doubt about the Company's ability to continue as a
going concern.
CELESTICA INC: Moody's Affirms Ba2 CFR, Outlook Stable
------------------------------------------------------
Moody's Investors Service affirmed Celestica Inc.'s Ba2 corporate
family rating, Ba2-PD probability of default rating, and Ba1 rating
for Celestica's upsized $1.15 billion senior secured credit
facilities, comprised of a $700 million term loan B due 2025
(upsized from $350 million via a $350 million add-on) and a $450
million revolving credit facility due 2023. Celestica's SGL-1
speculative grade liquidity rating, indicating very good liquidity
arrangements, was also affirmed, while the company's stable ratings
outlook was maintained. Proceeds from the upsized term loan B will
fund Celestica's $330 million acquisition of Impakt Holdings, LLC
and pay related fees and expenses.
"We affirmed Celestica's ratings because the Impakt acquisition is
strategically appropriate and, while there is always execution risk
with acquisitions, we think that pro forma Moody's adjusted
debt-to-EBITDA of about 2.8x -- up from about 2x -- remains
acceptable," said Bill Wolfe, a Moody's senior vice president.
Wolfe also indicated that the combination of execution risks and
leverage left Celestica with little financial flexibility at its
Ba2 rating level.
The following summarizes Celestica's ratings and its actions:
Rating and Outlook Actions:
Issuer: Celestica Inc.
Corporate Family Rating, Affirmed at Ba2
Probability of Default Rating, Affirmed at Ba2-PD
Speculative Grade Liquidity Rating, Affirmed at SGL-1
Gtd Senior Secured Credit Facilities, including the new $350
million add-on term loan B (Celestica Inc. is the parent borrower;
Celestica International LP and Celestica Inc. are co-borrowers),
Affirmed at Ba1 (LGD3)
Outlook, Remains Stable
RATINGS RATIONALE
Celestica Inc.'s Ba2 CFR stems primarily from Moody's adjusted
leverage of debt/EBITDA of 2.5-to-2.75x, ~5% EBITDA margins and
modest growth prospects stemming from the company's participation
in the hyper-competitive electronics manufacturing services sector,
as well as event risks related to elevated concentration of
revenues with a small number of large customers. The company's
credit profile benefits from good free cash generation that
provides debt reduction flexibility, very good liquidity, a long
track record, and being able to augment growth and profitability
over the next several years by pivoting to adjacent markets.
Celestica has an SGL-1 speculative grade liquidity rating
(indicating very good liquidity) as a result of approximately $130
million of annual free cash flow generation, ~$475 million in cash
(at 30Sept18, pro forma for the Impakt transaction), and ~$395
million of availability under the company's $450 million revolving
credit facility maturing in 2023. Other than nominal amortization
under its new term loan B, Celestica has no maturing debts, but
because the company's $200 million accounts receivable
securitization facility is not committed, Moody's assumes that the
$113 million of outstandings are due within its forward four
quarters window. Even with that, however, the quantum of liquidity
remains solid, and Moody's does not expect financial covenant
compliance issues.
Rating Outlook
The stable outlook is based on expectations of a stable business
platform, with leverage of debt/EBITDA remaining between 2.5x and
2.75x (2.8x at June 30, 2018, pro forma for the Impakt transaction;
Moody's adjustments add about 0.3x to reported figures).
What Could Change the Rating -- Up
Upwards rating pressure is contingent upon positive industry
fundamentals, solid operating performance evidenced by growing
margins, cash flow and scale and much improved customer
concentration, along with adjusted debt/EBITDA being maintained
below 2x on a sustained basis (2.8x at June 30, 2018, pro forma for
the Impakt transaction), pro forma for the refinance transaction.
What Could Change the Rating -- Down
Celestica's rating could be downgraded if adjusted debt/EBITDA
leverage is expected to be sustained above 3x (2.8x at June 30,
2018, pro forma for the Impakt transaction), if additional
debt-financed acquisition activity occurs prior to meaningful
de-levering, if liquidity deteriorates markedly, or if financial
policies become more aggressive.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in June 2018.
Headquartered in Toronto, Ontario and with annual sales of about
$6.4 billion (pro forma for the Impakt transaction), publicly
traded Celestica Inc. is an electronics manufacturing services
company providing a full range of integrated, value-added solutions
to original equipment manufacturers.
CELESTICA INC: S&P Lowers Senior Secured Debt Rating to 'BB'
------------------------------------------------------------
S&P Global Ratings said it has lowered its issue-level rating and
revised its recovery rating on Celestica Inc.'s senior secured
debt. Celestica is proposing to issue an incremental US$350 million
add-on to the existing term loan that lowers the recovery prospects
for the senior secured lenders. S&P said, "As a result, we are
lowering our issue-level rating on the senior secured debt to 'BB'
from 'BB+' and revising our recovery rating on the debt to '3' from
'2'. The '3' recovery reflects our expectation of meaningful
(50%-70%, rounded estimate 65%) recovery in a default scenario."
S&P expects the company will use the proceeds to fund the US$329
million acquisition of Impakt Holdings LLC and to fund cash on the
balance sheet for general corporate purposes.
All other ratings, including the 'BB' long-term-issuer credit
rating on Celestica are unchanged.
The US$329 million debt-funded acquisition will increase the
company's adjusted pro forma debt-to-EBITDA ratio by 1x to about
3x--a level that is at the higher end of S&P's tolerance at the
current rating. The higher leverage is somewhat mitigated by
improved overall profitability from a more favorable product mix.
S&P said, "As a result, our 'BB' issuer credit rating and stable
outlook on Celestica are unaffected by the debt-financed
acquisition. In our view, the acquisition improves the company's
exposure to the diversified end segment to about 40% by year-end
2019, because of a higher margin and long product lifecycle (and
therefore stable revenues), and is accretive to cash flow growth.
As a result, we anticipate Celestica's adjusted EBITDA margins will
improve to about 5.0%-5.5% over the next 12 months from our
previous expectation of 4.5%-5.0%, which benefits the company's
business risk profile."
ISSUE RATINGS—RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario incorporates the assumption
that Celestica will default in 2023, due to intense competition,
pricing pressure, customer attrition, inefficient capital spending,
and an economic slowdown.
-- S&P assumes that Celestica would be reorganized or sold as a
going concern as opposed to being liquidated because the company
would likely retain greater value as an ongoing entity.
-- S&P believes that if Celestica were to default, there would
continue to be a viable business model driven by Celestica's market
position, customer relationships, and expertise in the electronics
manufacturing services market.
-- S&P's recovery analysis yields a net default enterprise value
of US$719 million.
-- S&P bases this on a 5.5x multiple of US$138 million of
emergence EBITDA estimate and 5% administrative expenses.
-- The EBITDA multiple is 0.5x lower than the industry multiple of
6.0x, in line with other similarly rated peers in the industry.
-- S&P has used capital expenditure as 1% percent of sales
compared with the 2% default assumption in its recovery criteria,
reflecting Celestica's minimum capital investment requirements.
-- The first-lien secured claims has a '3' recovery rating,
indicating S&P's expectation for substantial (50%-70%, rounded
estimate of 65%) recovery in the event of a default, leading to an
issue-level rating of 'BB'.
-- S&P's analysis also incorporates the fact that the first-lien
creditors are secured by only 40% of Celestica's default enterprise
value. A majority of the company's asset base are in jurisdictions
that provide no security pledge and the other non-U.S.-restricted
subsidiaries have a 65% security pledge, as per the credit
agreement.
-- As a result, the recovery rating on the senior secured debt
claims could be affected if the company plans to issue junior
ranking debt below the senior secured debt.
Simulated default assumptions:
-- Default year: 2023
-- Emergence EBITDA: US$138 million
-- Multiple: 5.5x
Simplified waterfall:
-- Gross recovery value: US$757 million
-- Net recovery value for waterfall after administrative expenses
(5%): US$719 million
-- Obligor/non-obligor valuation split: 40%/60%
-- Value available for senior secured claims : US$719 million
-- Estimated senior secured claims: US$1.08 billion
--Recovery range: 50%-70% (rounded estimate 65%)
All debt amounts include six months of prepetition interest.
RATINGS LIST
Celestica Inc.
Issuer credit rating BB/Stable/--
Rating Lowered/Recovery Rating Revised
To From
Senior secured debt BB BB+
Recovery rating 3 2
CENGAGE: Bank Debt Trades at 6% Off
-----------------------------------
Participations in a syndicated loan under which Cengage (fka
Thomson Learning) is a borrower traded in the secondary market at
93.55 cents-on-the-dollar during the week ended Friday, October 26,
2018, according to data compiled by LSTA/Thomson Reuters MTM
Pricing. This represents a decrease of 0.74 percentage points from
the previous week. Cengage pays 425 basis points above LIBOR to
borrow under the $17 million facility. The bank loan matures on
June 7, 2023. Moody's rates the loan 'B2' and Standard & Poor's
gave a 'B' rating to the loan. 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 Friday,
October 26.
CHARLOTTE HOUSING: S&P Alters Outlook on CCC+ Bonds Rating to Neg.
------------------------------------------------------------------
S&P Global Ratings revised the outlook on its 'CCC+' rating on
Charlotte Housing Authority, N.C.'s series 2011A revenue bonds,
issued for Sandlewood Affordable Housing LLC's Sandlewood
apartments project, to negative from stable and affirmed the
rating.
The outlook revision reflects S&P Global Ratings' opinion of the
project's continued cash-flow disruptions due to unexpected
expenses and historical reliance on significant contributions from
the project owner to achieve breakeven performance, as well as
Citrus Grove apartments' lower Real Estate Assessment Center score.
The rating service still believes the bonds are vulnerable to
nonpayment in the event of adverse business, financial, or economic
conditions because the project cannot generate sufficient income
for debt service.
"We could lower the rating if debt service coverage were to
decrease significantly or the trustee were to draw on the
debt-service-reserve fund," said S&P Global Ratings credit analyst
Emily Avila. "We could revise the outlook to stable if overall
financial performance were to stabilize at levels closer to 1x debt
service coverage. However, we think it is unlikely financial
performance will improve significantly during the next fiscal year
to levels we consider commensurate with higher-rated peers."
The negative outlook reflects S&P Global Ratings' opinion operating
results and debt service coverage could weaken further during the
next fiscal year.
CHATEAU VILLABOIS: Plan Exclusivity Period Extended Through Nov. 5
------------------------------------------------------------------
The Hon. David W. Hercher of the U.S. Bankruptcy Court for the
District of Oregon, at the behest of Chateau Villabois, LLC, has
entered an order extending exclusivity period to file and solicit
votes on a chapter 11 plan through November 5, 2018.
About Chateau Villabois
Chateau Villabois, LLC, based in Lake Oswego, OR, filed a Chapter
11 petition (Bankr. D. Ore. Case No. 18-31827) on May 23, 2018. In
the petition signed by John Patrick Lucas, managing member, the
Debtor disclosed $1.50 million in assets and $1.79 million in
liabilities. The Hon. David W Hercher presides over the case. Ted
A. Troutman, Esq., at Troutman Law Firm, PC, serves as bankruptcy
counsel; and Infinity Real Estate Group, Inc., as property manager
to the Debtor.
CINRAM GROUP: Plan Outline Okayed, Plan Hearing on Nov. 29
----------------------------------------------------------
Cinram Group, Inc. and its affiliates are now a step closer to
emerging from Chapter 11 protection after a bankruptcy judge
approved the outline of their plan of reorganization.
Judge Vincent Papalia of the U.S. Bankruptcy Court for the District
of New Jersey on Oct. 25 gave the thumbs-up to the disclosure
statement after finding that it contains "adequate information."
The order set a Nov. 21 deadline for creditors to file their
objections and a Nov. 26 deadline to submit ballots of acceptance
or rejection of the plan.
A court hearing to consider confirmation of the plan is scheduled
for Nov. 29, at 11:00 a.m.
About Cinram Group Inc.
Cinram Group, Inc., and its affiliates were once providers of media
development and delivery services. Located in North America and
Europe, Cinram worked with some of the biggest names in home
entertainment and retail. As consumer demand has rapidly shifted
away from physical media for audio and video over the past several
years, Cinram has exited the manufacturing and supply chain
services business, selling or winding down substantially all of its
operations and operating assets. As a result, Cinram no longer has
any active business operations. Remaining assets consist primarily
of approximately four million square feet of owned and leased
industrial property and undeveloped land located in Pennsylvania
and Alabama.
Livingston, New Jersey-based Cinram Group, Inc., and its affiliates
sought Chapter 11 protection (Bankr. D.N.J. Lead Case No. 17-15258)
on March 17, 2017. In the petitions signed by CEO Glenn Langberg,
Cinram Group estimated $1 million to $10 million in assets and
liabilities; Cinram Operations, Inc., estimated $1 million to $10
million in assets and under $50,000 in liabilities; Cinram Property
Group, LLC, estimated $10 million to $50 million in assets and
under $50,000 in liabilities.
The Hon. Vincent F. Papalia presides over the jointly administered
cases.
Kenneth A. Rosen, Esq., at Lowenstein Sandler, LLP, serves as
bankruptcy counsel to the Debtors.
On April 3, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. Cole Schotz P.C. serves
as the committee's bankruptcy counsel.
CLASSIC COMMUNITIES: Plan Outline Okayed, Plan Hearing on Dec. 20
-----------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Pennsylvania
is set to hold a hearing on Dec. 20, at 10:00 a.m., to consider
approval of the Chapter 11 plan for Classic Communities
Corporation.
The hearing will be held at The Ronald Reagan Federal Building,
Bankruptcy Courtroom.
The court had earlier approved the company's disclosure statement,
allowing it to start soliciting votes from creditors.
The order, signed by Judge Robert Opel II on Oct. 25, set a Nov. 29
deadline for creditors to file their objections and submit ballots
of acceptance or rejection of the plan.
About Classic Communities Corp.
Classic Communities Corporation filed a Chapter 11 bankruptcy
petition (Bankr. M.D. Pa. Case No. 16-02022) on May 10, 2016. The
petition was signed by Douglas Halbert, president. The Debtor
estimated assets and liabilities in the range of $10 million and
debts of up to $50 million. Judge Robert N. Opel II presides over
the case.
The Debtor tapped Cunningham, Chernicoff & Warshawsky, P.C., as
counsel.
Andrew Vara, acting U.S. trustee for Region 3, appointed an
official committee of unsecured creditors on June 7, 2016. The
Committee tapped Cole Schotz P.C. as counsel.
The Debtor filed its proposed Chapter 11 plan and disclosure
statement on August 27, 2018.
COLONIAL OAKS: Judge Signs Final Cash Collateral Order
------------------------------------------------------
The Hon. Trish M. Brown of the U.S. Bankruptcy Court for the
District of Oregon has signed a final order authorizing Colonial
Oaks Mobile Home Park, LLC to use $83,326 of cash collateral for
the period of Oct. 15, 2018 through and including February 23, 2019
in accordance with the Budget, together with a 10% aggregate
variance.
The following Creditors may claim a lien in the Debtor's cash
collateral:
(a) Polk County, which is owed $50,000, has a tax lien on the
real property;
(b) AMR Investment Group, LLC, asserts a claim of $765,000,
secured by a Deed of Trust and Assignment of Rents;
(c) OBB Partners, LLC, asserts a claim of $250,000, secured by
a Deed of Trust and Assignment of Rents;
(d) Kenneth W. Hick, asserts a claim of $149,000, secured by a
Deed of Trust and Assignment of Rents;
(e) Brian Leitgeb, as Personal Representative for the Estate
of Irwin Leitgeb, asserts a claim of $149,000, secured by a Deed of
Trust and Assignment of Rents;
The Lien Creditors are granted replacement liens upon all
post-petition assets of the Debtor which are of the identical
description to its pre-petition collateral, with the same relative
priority vis-a-vis each other that existed as if the Petition
Date.
Additionally, the Debtor will make adequate protection payments to
AMR Investment Group in the amount of $6,300 each month beginning
on or before November 1, 2018 and continuing on or before the first
day of each month thereafter.
A full-text copy of the Final Order is available at
http://bankrupt.com/misc/orb18-33183-46.pdf
About Colonial Oaks Mobile Home Park
Colonial Oaks Mobile Home Park, LLC, filed as a Single Asset Real
Estate (as defined in 11 U.S.C. Section 101(51B)), whose principal
assets are located at 934 Main St. Independence, Oregon.
Colonial Oaks Mobile Home Park filed a voluntary petition under
Chapter 11 of the Bankruptcy Code (Bankr. D. Ore. Case No.
18-33183) on Sept. 12, 2018. In the petition signed by Susan
Daniell, member, the Debtor estimated $1 million to $10 million in
assets and liabilities as of the bankruptcy filing. The case is
assigned to the Hon. Trish M. Brown. Nicholas J. Henderson, Esq.,
at Motschenbacher & Blattner, LLP is the Debtor's counsel.
COMMUNITY CHOICE: Reaches Restructuring Agreement with Noteholders
------------------------------------------------------------------
Community Choice Financial Inc. had entered into an agreement to
undertake a financial restructuring of the Company in accordance
with a restructuring term sheet to be implemented out-of-court
through, among other things, a strict foreclosure pursuant to the
terms of the Uniform Commercial Code.
The Company entered into the Restructuring Support Agreement with
the beneficial holders, or investment advisors or managers for
certain beneficial holders, representing holders in excess of 50%
of the Company's 10.75% senior secured notes due May 1, 2019, 100%
of the holders of the Company's 12.75% senior secured notes due May
1, 2020, and holders in excess of 95% of the 9.0% senior secured
notes due 2020 issued by a subsidiary of the Company.
On Oct. 31, 2018, the Board of Directors of the Company decided
that it was not in the Company's best interest to make a $13.72
million interest payment due Nov. 1, 2018 on the Existing Notes.
On Nov. 1, 2018, the Company defaulted on its obligation to make
such interest payment. The Company's failure to pay interest on
the 2019 Notes and the 2020 Notes constitutes a Default that, if
uncured, will ripen into an Event of Default, and upon the
occurrence of any Event of Default, the Collateral Agent under the
2019 Indenture and 2020 Indenture has certain default-related
remedies.
Through the consummation of the Deleveraging Transaction, the
enterprise will realize a substantial reduction in its cash
interest obligations. The $260 million of Existing Notes will be
satisfied. The $260 million New PIK Notes are unsecured, do not
require cash interest payments, have extended maturity dates, and
may be redeemed for equity in certain circumstances. The Company
believes the improved leverage profile of the enterprise to be in
the best interest of all of its stakeholders.
The Deleveraging will be effected by way of a strict foreclosure
transaction, pursuant to which Computershare Trust Company, N.A.,
as collateral agent under the Existing Indentures, acting at the
direction of the Noteholder Majority of each of the Existing Notes,
will acquire all right, title and interest in and to all of the
assets of the Company, including the issued and outstanding equity
interests in each of the Company's direct subsidiaries and those
assets will be transferred to a new limited liability company (or
other corporate entity) ("Opco") not owned or controlled by the
Company. The Foreclosure Assets constitute all of the assets of
the Company. The Opco will be an indirect wholly owned subsidiary
of a newly formed holding company (the "Newco"). As a result of
the strict foreclosure transaction, all obligations represented by
the Existing Notes will be extinguished.
The Newco is expected to issue three classes of common units in
connection with the deleveraging: Class A Common Units, Class B
Common Units, and Class C non-voting Common Units (which may be
issued to holders of existing equity of the Company).
Generally, the Deleveraging Transaction will provide that:
* The Company's obligations under its existing $42.0 million
revolving credit agreement will be extended to mature four and
one-half years after the closing date of the transaction and
will be assumed by the Opco and the Senior Secured Notes
(which are backed by the revolving credit agreement) will
remain outstanding and similarly extended.
* The holders of the Senior Secured Notes will receive Newco
Class B Common Units representing approximately 12.3% of the
total number of outstanding Common Units of the Newco
outstanding on the effective date.
* The holders of the Existing Notes will receive their pro rata
share of (i) a new series of 10.75% Unsecured PIK Notes issued
by the Newco), which will mature five years after the closing
date of the transaction, which New PIK Notes may, under
certain circumstances be redeemed in Class A Common Units of
the Newco and will have other terms as described in the Term
Sheet and (ii) 100% of Class A Common Units of the Newco
issued on the effective date.
- The Class A Common Units issued on the Effective Date
are subject to dilution by the Class B Units, Class C
Units, Class A Common Units that may be issued in
redemption of the New PIK Notes, Common Units in respect
of issuances of additional debt securities, and Common
Units issuable under the MIP. In the event that the New
PIK Notes are redeemed in Class A Common Units, the
number of those units will represent 99% of all Common
Units of Newco other than Class B Common Units, Class C
Common Units, and additional Common Units that may be
issued in respect of a Qualified Financing.
The Class A Common Units and Class B Common Units (which Class B
Common Units will represent 12.3% of the aggregate number of the
issued and outstanding common units on the effective date, subject
to adjustment for any future issuances of common units (i) in
consideration for the redemption of the New PIK Notes, or (ii) in
connection with the issuance of any additional debt securities,
such that they continue to represent 12.3% of the issue and
outstanding common units (including such Redemption Units and
Additional Financing Units, but subject to dilution from the MIP))
will entitle the holders thereof to voting rights as well as
customary drag-rights, tag-rights, registration rights and
information rights (in each case, subject to the limitations in the
governing documents of Newco). Class C Common Units will be
entitled to a percentage (to be agreed) of distributions from the
Newco after payments in respect of the Existing Notes have exceeded
the balance thereof. The Class C Common Units will be subject to
dilution from the MIP and other Common Units and other equity
interests of Newco that may be issued after the effective date of
the Deleveraging.
The Restructuring Support Agreement also (i) requires the
establishment of a customary Management Incentive Plan, pursuant to
which a number of non-voting Common Units or profit interests equal
to up to 15% of the outstanding Newco Common Units after giving
effect to these transactions will be reserved for participants on
terms to be determined by the board of Newco and (ii) establishes
governance for the Newco, including as to the composition of the
board. The Company and other parties agree to use commercially
reasonable efforts to effectuate the Deleveraging transaction.
Completion of the strict foreclosure transaction remains subject to
negotiation and execution of definitive documentation satisfactory
in form and substance to the Company and the Noteholder Majority of
each of the Existing Notes, in their respective sole discretion,
and other conditions, including obtaining further consents
described in the Restructuring Support Agreement, including of
certain beneficial holders of Existing Notes.
The Company is represented by:
Weil, Gotshal & Manges LLP
700 Louisiana Street, Suite 1700
Houston, Texas 77002
Attn: Alfredo R. Perez and Patrick W. Thompson
Email: alfredo.perez@weil.com and patrick.thompson@weil.com
Computershare Trust Company, N.A., as Collateral Agent, is
represented by:
Latham & Watkins LLP
330 North Wabash Avenue, Suite 2800
Chicago, Illinois 60611
Attn: Richard A. Levy and James Ktsanes
Email: Richard.Levy@lw.com and James.Ktsanes@lw.com
A full-text copy of the Restructuring Support Agreement is
available for free at https://is.gd/vSRdcc
About Community Choice Financial
Dublin, Ohio-based Community Choice Financial Inc. --
http://www.ccfi.com/-- is a retailer of financial services to
unbanked and underbanked consumers through a network of 476 retail
storefronts across 12 states and is licensed to deliver similar
financial services over the internet in 30 states. CCFI focuses on
providing consumers with a wide range of convenient financial
products and services to help them manage their day-to-day
financial needs including consumer loans, check cashing, prepaid
debit cards, money transfers, bill payments, and money orders.
Community Choice incurred a net loss of $180.9 million in 2017,
compared to a net loss of $1.54 million in 2016. As of June 30,
2018, the Company had $186.5 million in total assets, $407.6
million in total liabilities and a total stockholders' deficit of
$221.08 million.
* * *
As reported by the TCR on April 19, 2018, S&P Global Ratings said
it lowered its issuer credit rating on Community Choice Financial
to 'CC' from 'CCC'. The outlook is negative. S&P said, "The
downgrade follows the company's amended revolver and subsidiary
note payable on March 30, 2018 -- both of which require CCFI to
make a proposal to restructure its senior secured notes, which, if
completed, we would likely view as a selective default."
As reported by the TCR on Sept. 10, 2018, Moody's Investors Service
affirmed Community Choice Financial Inc.'s Caa3 corporate family.
Moody's said Community Choice's Caa3 corporate family reflects its
unsustainable capital structure with large amounts of debt and
substantial equity deficit, weak financial performance, constrained
liquidity, and also high regulatory risk.
CONCORDIA INTERNATIONAL: Will Release its Q3 Results on Nov. 14
---------------------------------------------------------------
Concordia International Corp. intends to release its third quarter
2018 financial results before market open on Wednesday, Nov. 14,
2018.
The Company will subsequently hold a conference call that same day
at 8:30 a.m. ET hosted by Mr. Graeme Duncan, chief executive
officer, and other senior management. A question-and-answer
session will follow the corporate update.
CONFERENCE CALL DETAILS
Date: Wednesday, November 14, 2018
Time: 8:30 a.m. ET
Dial-in Number: (647) 427-7450 or (888) 231-8191
Taped Replay: (416) 849-0833 or (855) 859-2056
Reference Number: 2079874
This call is being webcast and can be accessed by going to:
https://event.on24.com/wcc/r/1867604/F576FCA0B9ECB9703EB9BF42E5F12A96
An archived replay of the webcast will be available by clicking the
link above.
About Concordia
Based in Ontario, Canada, Concordia -- http://www.concordiarx.com/
-- is an international specialty pharmaceutical company with a
diversified portfolio of more than 200 patented and off-patent
products, and sales in more than 90 countries. Going forward, the
Company is focused on becoming a leader in European specialty,
off-patent medicines. Concordia operates out of facilities in
Mississauga, Ontario and, through its subsidiaries, operates out of
facilities in Bridgetown, Barbados; London, England and Mumbai,
India.
Concordia reported a net loss of US$1.59 billion for the year ended
Dec. 31, 2017, compared to a net loss of US$1.31 billion for the
year ended Dec. 31, 2016. As of June 30, 2018, Concordia had
US$2.12 billion in total assets, US$4.25 billion in total
liabilities and a total shareholders' deficit of US$2.13 billion.
The audit opinion included in the Company's Annual Report on Form
10-K for the year ended Dec. 31, 2017 contains a going concern
explanatory paragraph. PricewaterhouseCoopers LLP, the Company's
auditor since 2015, stated that the Company has commenced a court
proceeding under the Canada Business Corporation Act (CBCA) to
restructure certain debt obligations. The commencement of the CBCA
proceedings has resulted in events of default under certain of the
Company's credit facilities and a termination event under the cross
currency swap agreement, which defaults are subject to the stay of
proceedings granted by the court. These events raise substantial
doubt about the Company's ability to continue as a going concern.
COVIA HOLDINGS: Bank Debt Trades at 9% Off
------------------------------------------
Participations in a syndicated loan under which Covia Holdings
Corporation is a borrower traded in the secondary market at 90.75
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 2.52 percentage points from the
previous week. Covia Holdings pays 375 basis points above LIBOR to
borrow under the $16 million facility. The bank loan matures on
June 1, 2025. Moody's rates the loan 'Ba3' and Standard & Poor's
gave a 'BB' rating to the loan. 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 Friday,
October 26.
CRT RECOVERY: Confirmation Hearing Set for Nov. 14
--------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida is
set to hold a hearing on Nov. 14, at 10:00 a.m., to consider
approval of the Chapter 11 plan of reorganization and disclosure
statement filed by CRT Recovery, Inc.
The hearing will take place at Courtroom 308.
The deadline for creditors to file their objections and submit
ballots of acceptance or rejection of the plan is Nov. 7.
About CRT Recovery Inc.
CRT Recovery, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-15248) on May 1,
2018. At the time of the filing, the Debtor estimated assets of
less than $50,000 and liabilities of less than $50,000. Judge
Raymond B. Ray presides over the case. Chad Van Horn, Esq., at law
firm of Van Horn Law Group, Inc., is the Debtor's counsel.
No official committee of unsecured creditors has been appointed.
CRYOLIFE INC: S&P Affirms B Rating on $255MM Secured Loans
----------------------------------------------------------
S&P Global Ratings affirmed its 'B' issue-level rating on CryoLife
Inc.'s $225 million first-lien credit facility and $30 million
revolver following the company's proposed repricing. The '3'
recovery rating remains unchanged, indicating S&P's expectation for
meaningful recovery (50%-70%; rounded estimate: 50%) in the event
of a payment default.
Following the repricing, S&P expects the interest rate on the debt
to decline by 75 basis points (bps) to LIBOR+325 bps. While the
proposed repricing will slightly decrease CryoLife's interest
expense, our expectation that the company could default if its
EBITDA fell to $26 million is materially unchanged as are our
previous assumptions about its post-default valuation.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
S&P said, "Our recovery analysis reflects the company's capital
structure, which consists of a $30 million revolver and a $225
million term loan that are both secured by a first lien and are
pari-passu with each other.
"Our simulated default scenario is based on a default occurring in
2021 because of an operational disruption or intensified
competition from the company's larger and well-established
competitors.
"We value the company as a going concern using a 5.5x multiple of
our projected emergence EBITDA, which is consistent with the
multiples we use for its peers.
"We also assume that, in a hypothetical bankruptcy scenario,
CryoLife would have drawn 85% of its $30 million revolver
facility."
Simulated default scenario
-- Simulated year of default: 2021
-- EBITDA at emergence: $26 million
-- EBITDA multiple: 5.5x
-- Jurisdiction: U.S.
Simplified waterfall
-- Net enterprise value at default (after 5% administrative
costs): $137 million
-- Valuation split (obligors/nonobligors): 75%/25%
-- Collateral value available to secured creditors: $125 million
-- First-lien secured debt: $251 million
--Recovery expectations: 50%-70% (rounded estimate: 50%)
Note: All debt amounts include six months of prepetition
interest.
RATINGS LIST
CryoLife Inc.
Issuer Credit Rating B/Positive/--
Issue Ratings Affirmed; Recovery Ratings Unchanged
CryoLife Inc.
Senior Secured
$225M 1st-ln Facility B
Recovery Rating 3(50%)
$30M Revolver B
Recovery Rating 3(50%)
CWGS GROUP: $25MM Bank Debt Trades at 3% Off
--------------------------------------------
Participations in a syndicated loan under which CWGS Group LLC is a
borrower traded in the secondary market at 96.88
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.83 percentage points from the
previous week. CWGS Group pays 275 basis points above LIBOR to
borrow under the $25 million facility. The bank loan matures on
November 18, 2023. Moody's rates the loan 'B1' and Standard &
Poor's gave a 'BB+' rating to the loan. 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
Friday, October 26.
CWGS GROUP: $93MM Bank Debt Trades at 3% Off
--------------------------------------------
Participations in a syndicated loan under which CWGS Group LLC is a
borrower traded in the secondary market at 96.88
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.83 percentage points from the
previous week. CWGS Group pays 275 basis points above LIBOR to
borrow under the $93 million facility. The bank loan matures on
November 8, 2023. Moody's rates the loan 'B1' and Standard & Poor's
gave a 'BB+' rating to the loan. 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 Friday,
October 26.
DAVID'S BRIDAL: Bank Debt Trades at 14% Off
-------------------------------------------
Participations in a syndicated loan under which David's Bridal
Incorporated is a borrower traded in the secondary market at 85.67
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 3.91 percentage points from the
previous week. David's Bridal pays 375 basis points above LIBOR to
borrow under the $52 million facility. The bank loan matures on
October 11, 2019. Moody's rates the loan 'Caa2' and Standard &
Poor's gave a 'CCC-' rating to the loan. 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
Friday, October 26.
DAVID'S PATIO: Seeks Access to Prosperity Bank Cash Collateral
--------------------------------------------------------------
David's Patio, Ltd., seeks authorization from the U.S. United
States Bankruptcy Court for the Northern District of Texas to use
cash collateral in the ordinary course of its business to the
extent provided in the Budget.
The Debtor seeks permission to use cash collateral for the purpose
of paying its ordinary course of business expenses including but
not limited to utilities, insurance of various kind, wages,
salaries, administrative expenses, and adequate protection.
The Debtor believes that Prosperity Bank has lien against all cash
collateral by virtue of a commercial security agreement. On May 10,
2018, the Debtor executed a Promissory Note in favor of Prosperity
Bank, which was secured by, among others, a Deed of Trust for a 22
acres tract of land, equipment, and intangibles.
The Debtor claims that the extent and value of its assets
substantially exceed Prosperity Bank's secured claim.
Additionally, the Debtor is current with its obligations with
Prosperity Bank.
The Debtor contends that the use of cash collateral is reasonable
under the circumstances and the interest of Prosperity Bank is
adequately protected and the by the fact that it will retain its
lien, and the large equity cushion with respect to its claim. If
necessary, the Debtor will also provide Prosperity Bank with
adequate protection payment. Therefore, the Debtor is confident
that it can successfully reorganize in a relatively short time.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/txnb18-44081-8.pdf
About David's Patio, Ltd.
dba David's Concrete Innovations
Founded in 1962, David's Patio, Ltd. is involved in the manufacture
and finishing of concrete statuary products. Its customers include
nurseries, landscapers, hardware stores, building suppliers, mobile
home installers, foundation repair companies, and contractors in
Texas and the surrounding states. In addition to the Company's
concrete products, it also sells related products such as bagged
goods for nurseries and metal shims for foundation repair.
David's Patio sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Tex. Case No. 18-44081) on October 15, 2018. The
petition was signed by Mark J. O'Reilly, general partner, HDG
Management, LLC. At the time of filing, the Debtor disclosed total
assets of $1,996,173 and total debts of $2,019,727.
The Hon. Russell F. Nelms is the case judge.
The Debtor tapped Behrooz P. Vida, Esq. of the Vida Law Firm, PLLC
as bankruptcy counsel.
DEL MONTE: Bank Debt Trades at 12% Off
--------------------------------------
Participations in a syndicated loan under which Del Monte Pacific
Ltd. is a borrower traded in the secondary market at 88.44
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 2.01 percentage points from the
previous week. Del Monte pays 325 basis points above LIBOR to
borrow under the $71 million facility. The bank loan matures on
February 18, 2021. Moody's rates the loan 'Caa1' and Standard &
Poor's gave a 'CCC+' rating to the loan. 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
Friday, October 26.
DISASTERS STRATEGIES: May Use Cash Collateral on Final Basis
------------------------------------------------------------
The Hon. Karen K. Specie of the U.S. Bankruptcy Court for the
Northern District of Florida has entered order authorizing
Disasters, Strategies and Ideas Group, LLC, to use cash collateral
on a final basis.
The Debtor is authorized to use Hancock Whitney Bank's cash
collateral to pay the monthly expenses in the budget and all fees
required by the United States Trustee and Clerk of the Court. The
Debtor will operate strictly in accordance with the Budget and will
not exceed 10% above the amount of any line item shown in the
Budget.
Hancock Whitney Bank will have a first priority post-petition
security interest in, and lien upon, all of the Debtor's personal
property, and all cash and non-cash proceeds thereof, which are or
have been acquired, generated or received by the Debtor after the
Petition Date, to the same extent that Hancock Whitney Bank held a
properly perfected prepetition security interest or lien in assets
immediately prior to the Petition Date.
On the first day of each month, the Debtor will, deliver to Hancock
Whitney Bank, monthly payments in the amount of $5,627 (for loan
#3183) and $2,373 (for loan #3188), totaling $8,000. This amount
will be paid after normal and necessary business expenses and U.S.
Trustee fees.
As additional adequate protection for the Debtor's use of cash
collateral, the Debtor will (i) maintain insurance coverage for its
business operations and real and personal property in accordance
with its obligations under the loan and security documents with
Hancock Whitney Bank; (ii) promptly furnish Hancock Whitney Bank
with such financial and other information as required by the
underlying loan documents and such other information, documents and
reports as the Bank may reasonably request.
A copy of the Final Order is available at
http://bankrupt.com/misc/flnb18-40375-84.pdf
About Disasters, Strategies and Ideas Group
Disasters, Strategies and Ideas Group, LLC --
http://www.dsideas.com/-- is an emergency management and homeland
security services consulting firm. DSI was established by former
North Carolina and Florida Emergency Management Director Joe Myers
in 2003 to provide emergency management services to state, local
and federal agencies.
Headquartered in Tallahassee, Florida, DSI serves Florida and the
Southeast with a team of professionals that is expert in all
aspects of homeland security and emergency management, with its
primary focus being disaster recovery grant management services.
Disasters, Strategies and Ideas Group filed a Chapter 11 petition
(Bankr. N.D. Fla. Case No. 18-40375) on July 17, 2018. In the
petition signed by Joseph Myers, vice president, the Debtor
estimated less than $50,000 in assets and $1 million to $10 million
in liabilities. The case is assigned to Judge Karen K. Specie.
Bruner Wright, P.A., is the Debtor's counsel. No official
committee of unsecured creditors has been appointed in the Chapter
11 case.
DIXIE ELECTRIC: Case Summary & 30 Largest Unsecured Creditors
-------------------------------------------------------------
Thirteen affiliates that have filed voluntary petitions seeking
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Dixie Electric, LLC (Lead Case) 18-12477
1155 Dairy Ashford Road, Suite 450
Houston, TX 77079
FR Dixie Holdings Corp. 18-12474
FR Dixie Acquisition Corp. 18-12475
FR Dixie Acquisition Sub Corp. 18-12476
Monahans Electric, Inc. 18-12478
K&S Electric, Inc. 18-12479
L&K Electric, LLC 18-12480
Patriot Automation & Control, LLC 18-12481
Epic Integrated Services, LLC 18-12482
Action Electric Holdings, Inc. 18-12483
Action Electric, Inc. 18-12484
Mac Supply, Inc. Electrical Contractors 18-12485
Wellkeeper, Inc. 18-12486
Business Description: Dixie Electric, LLC dba Expanse Energy
Solutions is a privately held provider of
electrical infrastructure materials and
services to the energy industry.
Headquartered in Houston, Texas, the Company
offers its upstream and midstream customers
solutions for oilfield electrical
infrastructure and automation for the
initial development of an oilfield through
its full lifecycle. These services include
ongoing infrastructure upgrades and periodic
maintenance, including the initial design,
installation, subsequent modification,
upgrade and maintenance of the
electrification and automation
infrastructure. The Company's operations
are concentrated in the Permian and Bakken
basins in North America. As of the Petition
Date, the Company had approximately 580
full-time employees. The Company was
founded and began operations in 1951. Visit
https://www.expanseenergy.com for more
information.
Chapter 11 Petition Date: November 2, 2018
Court: United States Bankruptcy Court
District of Delaware (Delaware)
Judge: Hon. Kevin Gross
Debtors'
General
Bankruptcy
Counsel: Elisha D. Graff, Esq.
Kathrine A. McLendon, Esq.
Edward R. Linden, Esq.
David Baruch, Esq.
SIMPSON THACHER & BARTLETT LLP
425 Lexington Avenue
New York, New York 10017
Tel: (212) 455-2000
Fax: (212) 455-2502
Email: egraff@stblaw.com
kmclendon@stblaw.com
edward.linden@stblaw.com
david.baruch@stblaw.com
Debtors'
Delaware
Bankruptcy
Counsel: Edmon L. Morton, Esq.
Sean M. Beach, Esq.
Elizabeth S. Justison, Esq.
Tara C. Pakrouh, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square
1000 North King Street
Wilmington, Delaware 19801
Tel: (302) 571-6600
Fax: (302) 571-1253
Email: emorton@ycst.com
sbeach@ycst.com
ejustison@ycst.com
tpakrouh@ycst.com
Debtors'
Investment
Banker: Joseph Fallon
PJT PARTNERS LP
280 Park Avenue
New York, New York 10017
Tel: 212.364.7800
https://pjtpartners.com
Debtors'
Tax
Consultant &
Restructuring
Advisor: BDO USA, LLP
330 North Wabash, Suite 3200
Chicago, IL 60611
Debtors'
Claims &
Noticing
Agent and
Administrative
Advisor: PRIME CLERK LLC
830 3rd Avenue, 3rd Floor
New York, New York 10022
https://cases.primeclerk.com/dixie/Home-Index
Total Asset as of Sept. 30, 2018: $145.3 million
Total Liabilities as of Sept. 30, 2018: $316.4 million
The petition was signed by Jerrit Coward, chief executive officer.
A full-text copy of Dixie Electric's petition is available for free
at:
http://bankrupt.com/misc/deb18-12474.pdf
List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Border States Electric Supply Trade Claim $2,181,364
Attn: Cynthia Kuehler
105 25th Street N
Fargo, ND 58102‐4002
Tel: 806‐712‐1009
Fax: 701‐232‐7673
Email: ckuehler@borderstates.com
Consolidated Electrical Trade Claim $1,856,676
Attn: Shane Smith
11560 Hillguard Road
Dallas, TX 75243
Tel: 817‐737‐5558
Fax: 214‐932‐3003
Email: shane.smith@ced.com
Dakota Supply Group Trade Claim $1,198,411
Attn: Robyn McNellis
2601 3rd Avenue
Fargo, ND 58102
Tel: 406‐443‐4012
Fax: 701‐237‐6504
Email: rmcnellis@dsginc.biz
Energy Electrical Distribution Co. Trade Claim $499,298
Attn: John Escalante
6575 Hinson Street
Las Vegas, NV 89118
Tel: 432‐332‐5758
Fax: 702‐649‐7983
Email: john.escalante@energyelect.com
Crescent Electric Supply Trade Claim $264,042
Attn: Carol Moslet
7750 Dunleith Drive
East Dubuque, IL 61025
Tel: 406‐252‐0216
Fax: 815‐747‐7720
Email: carol.moslet@cesco.com
Advanced Connections, Inc. Trade Claim $207,505
Attn: Cindy Cruz
2015 Mckenzie Drive, Suite 120
Carrollton, TX 750006
Tel: 972‐988‐3080
Fax: 855‐792‐1422
Email: Cindy.Cruz@acicabling.com
C.I.E. Wire & Cable, Inc. Trade Claim $172,249
Attn: Mike Denkers
1975 McCain Parkway
Pelham, AL 35124
Tel: 205‐380‐6540
Fax: 205‐663‐1228
Email: mdenkers@ciewirecable.com
Malloy Electric Bearing Supply Trade Claim $155,960
Attn: Debi Driscol
809 West Russell Street
Sioux Falls, SD 57104
Tel: 605‐357‐1034
Fax: 605‐336‐1545
Email: ddriscoll@malloyelectric.com
Vega Americas Inc. Trade Claim $148,822
Attn: Beth Ann Owens
4170 Rosslyn Drive
Cincinnati, OH 45209
Tel: 513‐272‐4223
Fax: 513‐272‐0133
Email: b.owens@vega.com
TDG Staffing LLC Trade Claim $125,178
Attn: Cassie Hughes
1001 West Loop South, Suite 560
Houston, TX 77027
Tel: 713‐932‐9313
Fax: 713‐932‐0112
Email: chughes@danielgroupus.com
Desert Hills Electric Supply Trade Claim $120,024
Attn: Amy Murphy
401 Commerce Road
Artesia, NM 88210
Tel: 575‐736‐0810
Fax: 575‐746‐8870
Email: amurphy@deserthillsinc.com
Circle Control Systems Trade Claim $113,738
Attn: Bruce Eralle
210 1st Avenue S
Moffit, ND 58560
Tel: 701‐527‐4701
Fax: 701‐527‐4701
Email: bruce_ccs@outlook.com
QED Trade Claim $97,874
Attn: Sandra Loung
5875 S. Decatur Boulevard
Las Vegas, NV 89118
Tel: 702‐415‐2409
Fax: 702‐871‐0132
Email: sluong@qedelectric.com
United Rentals, Inc. Trade Claim $83,880
Attn: Blanche Harris
100 First Stamford Place, Suite 700
Stamford, CT 06902
Tel: 704‐916‐4130
Fax: 203‐327‐2362
Email: blharris@ur.com
Jasper Engineering and Equipment Trade Claim $80,278
Attn: Emily Barbacle
3800 5th Avenue West, Suite 1
Hibbing, MN 55746
Tel: 952‐938‐6504
Fax: 218‐262‐4936
Email: embarnacle@jaspereng.com
Solomon Corporation Trade Claim $70,136
Attn: Heather Haley
103 West Main Street
Solomon, KS 67480
Tel: 785‐655‐2629
Fax: 785‐655‐2502
Email: hhaley@solomoncorp.com
Dykman Electrical Inc. Trade Claim $65,268
Attn: Rashaun May
2323 Federal Way
Boise, ID 83705
Tel: 208‐336‐1668
Fax: 208‐336‐3993
Email: rmay@dykman.com
UniFirst Holdings, Inc. Trade Claim $63,902
Attn: Blake Stephenson
68 Jonspin Road
Wilmington, MA 01887
Tel: 432‐332‐0548
Fax: 978‐657‐5663
Email: blake_stephenson@unifirst.com
Sunstate Equipment Co. Trade Claim $52,987
Attn: Lynn Parson
5552 E. Washington Street
Phoenix, AZ 85034
Tel: 602‐683‐2278
Fax: 602‐275‐2398
Email: lynn.parson@sunstateequip.com
Avalara, Inc Trade Claim $50,544
Attn: Brandon Cole
255 South King Street, Suite 1800
Seattle, WA 98104
Tel: 877‐780‐4848
Fax: 877‐759‐6520
Email: brandon.cole@avalara.com
Badlands Steel Inc. Trade Claim $48,368
Attn: Sabrina Martinez
4324 4th Avenue W, Suite 106
Williston, ND 58801
Tel: 701‐774‐2231
Fax: 701‐774‐2234
Email: badlandssteeloffice@badlandssteel.com
Clark Hill Strasburger Trade Claim $47,625
Attn: Martin Thornthwaite
901 Main Street, Suite 6000
Dallas, TX 75202
Tel: 469‐287‐3958
Fax: 214‐651‐4330
Email: martin.thornthwaite@clarkhillstrasburger.com
Altec Industries Trade Claim $39,948
Attn: Lynda Gagen
210 Inverness Center Drive
Birmingham, AL 35242
Tel: 205‐408‐8682
Fax: 205‐408‐8113
Email: lynda.gagen@altec.com
Leasing Associates Trade Claim $37,927
Attn: Susan Wich
12600 N. Featherwood Drive, Suite 400
Houston, TX 77034
Tel: 832‐300‐1304
Fax: 832‐300‐1317
Email: susanw@theleasingcompany.com
Odessa Winlectric Trade Claim $35,832
Attn: Carl Long
2022 Kermit Highway
Odessa, TX 79761
Tel: 432‐337‐0243
Fax: 432‐337‐1077
Email: clong@winlectric.com
McFarland Cascade Trade Claim $35,586
Attn: Lisa Page
1640 East Marc
Tacoma, WA 98421‐2939
Tel: 936‐634‐4923
Fax: 253‐627‐4188
Email: mpage@stella‐jones.com
Aggreko Holdings Inc / Aggreko LLC Trade Claim $35,377
Attn: Erin Kavanagh
15600 John F Kennedy Boulevard,
Suite 600
Houston, TX 77032
Tel: 337‐374‐3062
Fax: 337‐365‐1387
Email: erin.kavanagh@aggreko.com
Typhoon Excavation, Inc. Trade Claim $33,462
Attn: A. Mapes
2222 12th Avenue West
Williston, ND 58801
Tel: 701‐572‐4344
Fax: N/A
Email: amapes11@hotmail.com
Elynx Technologies Trade Claim $30,708
Attn: Jennifer Rodgers
6655 South Lewis, Suite 300
Tulsa, OK 74136
Tel: 918‐493‐1366
Fax: 918‐496‐8615
Email: jennifer.rodgers@elynxtech.com
Power/Mation Division Inc. Trade Claim $29,399
Attn: Greg Strauss
1310 Energy Lane
St. Paul, MN 55108
Tel: 651‐605‐4415
Fax: 651‐605‐4473
Email: greg.strauss@powermation.com
DPW HOLDINGS: Amends Form S-3 Registration Statement with the SEC
-----------------------------------------------------------------
DPW Holdings, Inc. has filed an amended registration statement on
Form S-3/A relating to the resale or other disposition from time to
time by Dominion Capital, LLC, Sichenzia Ross Ference, LLP,
DiamondRock, LLC, FirstFire Global Opportunities Fund, LLC and TFK
Investments, LLC of up to 20,494,514 shares of the Company's common
stock, consisting of:
(i) up to 16,794,685 shares of the Company's common stock that
the Company may issue from time to time upon conversion of
the unpaid balance of the principal and interest under (a)
a Senior Secured Convertible Promissory Note issued on
May 15, 2018 in the aggregate principal amount of
$6,000,000 convertible into 15,000,000 shares of the
Company's common stock and (b) a Senior Secured Convertible
Promissory Note issued on July 2, 2018 in the aggregate
principal amount of $1,000,000 convertible into 2,500,000
shares of the Company's common stock;
(ii) 400,000 shares of the Company's common stock issued in
connection with the May Convertible Note;
(iii) 200,926 shares of the Company's common stock issued to
three institutional investors pursuant to securities
purchase agreements dated April 16, 2018;
(iv) up to 993,588 shares of the Company's common stock issuable
upon the exercise of five year warrants issued to the April
2018 Investors; and
(v) 1,400,000 shares of the Company's common stock issued to a
vendor in consideration for services provided to the
Company.
On July 2, 2018, DPW Holdings entered into a securities purchase
agreement pursuant to which the Company issued and sold to a
selling stockholder the July Convertible Note, and agreed to issue
to such selling stockholder the May Commitment Shares in connection
with the May Convertible Note. The July Convertible Note bears
interest at 10% per annum and matures on Jan. 1, 2019. Each of the
Convertible Notes was convertible into common stock at $0.75 per
share, subject to adjustment. Pursuant to an amendment dated as of
Aug. 31, 2018, to the Convertible Notes, the Company reduced the
conversion price to $0.40 from $0.75 (resulting in the number of
issuable shares underlying the Convertible Notes increasing to
15,000,000 and 2,500,000, respectively). As of Oct. 26, 2018, the
balance of the principal amount, plus guaranteed interest, of the
July Convertible Note was $1,100.000, which may be convertible into
up to 2,750,000 shares of the Company's common stock.
On May 15, 2018, the Company entered into a securities purchase
agreement pursuant to which it issued and sold to a selling
stockholder the May Convertible Note, and issued 344,828 shares of
the Company's common stock and warrants to purchase up to an
aggregate of 2,835,249 shares of the Company's common stock,
consisting of warrants to purchase an aggregate of 1,111,111 shares
of common stock at an exercise price of $1.35 exercisable on the
date of issue and warrants to purchase an aggregate of 1,724,138
shares of the Company's common stock at an exercise price of $0.87
exercisable on the date of issue. The shares of common stock and
the shares issuable upon exercise of the warrants sold to such
selling stockholder were offered in a prior registered offering and
are not required to be registered on this prospectus.
The May Convertible Note bears interest at 10% per annum, with 50%
of the total interest due on the principal payable at the closing
and the remaining 50% payable as amortization payments with an
original maturity date of Nov. 15, 2018. Pursuant to the
Amendment, the maturity date of the May Convertible Note was
extended to Oct. 31, 2019 and the amortization schedule was revised
to provide for 14 monthly payments until the maturity date. As of
Oct. 26, 2018, the balance of the principal amount, plus interest,
of the May Convertible Note was $5,617,874, which may be
convertible, subject to the terms and conditions set forth therein,
into up to 14,044,685 shares of the Company's common stock.
On April 16, 2018, the Company entered into securities purchase
agreements with the April 2018 Investors pursuant to which the
Company issued and sold to those investors for an aggregate
purchase price of $1,550,000 (i) 12% secured convertible promissory
notes with an aggregate principal face amount of $1,722,222, (ii)
Warrants to purchase an aggregate of 993,588 shares of the
Company's common stock and (iii) an aggregate of 200,926 Commitment
Shares. Subject to certain beneficial ownership limitations and
upon the occurrence of an event of default that has not been cured,
the April 2018 Investors may convert the principal amount of the
12% Convertible Notes and accrued interest earned thereon into
2,607,937 shares of the Company's common stock at $0.70 per share,
subject to adjustment for customary stock splits, stock dividends,
combinations or similar events. The Warrants entitle the holders
to purchase, in the aggregate, up to 993,588 Warrant Shares at an
exercise price of $1.30 per share for a period of five years
subject to certain beneficial ownership limitations. The Company
has not included the shares issuable upon conversion of the 12%
Convertible Notes since the entire amount of principal and
interest, in the amount of $1,825,555, has been paid.
The Company issued a vendor the 400,000 Vendor Shares on May 8,
2018 and an additional 1,000,000 such shares on June 8, 2018 as
compensation for legal services provided to the Company.
The selling stockholders may from time to time, sell, transfer, or
otherwise dispose of any or all of the shares of common stock being
registered herein from time to time on any stock exchange, market,
or trading facility on which the shares are traded or in private
transactions. These dispositions may be at fixed prices, at
prevailing market prices at the time of sale, at prices related to
the prevailing market price, at varying prices determined at the
time of sale, or at negotiated prices.
DPW Holdings is not offering any shares of its common stock for
sale under this prospectus. The Company will not receive any of
the proceeds from the sale of common stock by the selling
stockholder. All expenses of registration incurred in connection
with this offering are being borne by the Company. All selling and
other expenses incurred by the selling stockholders will be borne
by the selling stockholders.
The Company's common stock is quoted and traded on the NYSE
American under the symbol "DPW." On Oct. 26, 2018, the last
reported sale price of the Company's common stock as reported on
the NYSE American was $0.25 per share.
A full-text copy of the amended prospectus is available at:
https://is.gd/Jf5A8w
About DPW Holdings
Headquartered in Fremont, California, DPW Holdings, Inc., formerly
known as Digital Power Corp. -- http://www.DPWHoldings.com/-- is a
diversified holding company that, through its wholly owned
subsidiary, Coolisys Technologies, Inc., is dedicated to providing
technology-based solutions where innovation is the main driver for
mission-critical applications and lifesaving services. Through its
wholly owned subsidiaries and strategic investments, the company
provides mission-critical products that support a diverse range of
industries, including defense/aerospace, industrial,
telecommunications, medical, crypto-mining, and textiles.
DPW Holdings incurred a net loss of $10.89 million in 2017
following a net loss of $1.12 million in 2016. As of June 30,
2018, DPW Holdings had $53.44 million in total assets, $21.90
million in total liabilities and $31.53 million in total
stockholders' equity.
The report from the Company's independent accounting firm Marcum
LLP, in New York, on the consolidated financial statements for the
year ended Dec. 31, 2017, includes an explanatory paragraph stating
that the Company has a significant working capital deficiency, has
incurred significant losses and needs to raise additional funds to
meet its obligations and sustain its operations. These conditions
raise substantial doubt about the Company's ability to continue as
a going concern.
FANNIE MAE: Reports $4 Billion Net Income for Third Quarter
-----------------------------------------------------------
Federal National Mortgage Association, a/k/a Fannie Mae, has filed
with the Securities and Exchange Commission its quarterly report on
Form 10-Q reporting net income of $4.01 billion on $29.34 billion
of total interest income for the three months ended Sept. 30, 2018,
compared to net income of $3.02 billion on $27.46 billion of total
interest income for the three months ended Sept. 30, 2017.
Fannie Mae's net income of $4.0 billion for the third quarter of
2018 compares to net income of $4.5 billion for the second quarter
of 2018. The primary driver of the decrease in net income was a
decrease in credit-related income due primarily to a reduction in
the benefit from the redesignation of loans from
held-for-investment to held-for-sale and a smaller improvement in
home prices compared with the second quarter of 2018. The decrease
was partially offset by higher fair value gains in the third
quarter of 2018 compared with the second quarter of 2018.
Net revenues, which consist of net interest income and fee and
other income, were $5.6 billion for both the third and second
quarters of 2018.
Net interest income was $5.4 billion for both the third and the
second quarters of 2018. The company's net interest income in the
third quarter of 2018 was derived primarily from guaranty fees on
its $3.3 trillion guaranty book of business.
For the nine months ended Sept. 30, 2018, the Company reported net
income of $12.72 billion on $86.71 billion of total interest income
compared to net income of $8.99 billion on $82.23 billion of total
interest income for the same period last year.
As of Sept. 30, 2018, Fannie Mae had $3.40 trillion in total
assets, $3.39 trillion in total liabilities and $6.97 billion in
total stockholders' equity.
Fannie Mae expects to pay a $4.0 billion dividend to Treasury by
Dec. 31, 2018. Through the third quarter of 2018, the company has
paid $171.8 billion in dividends to Treasury.
Hugh Frater, interim chief executive officer, commented, "Fannie
Mae's strong third quarter results reflect the company's positive
momentum, the strength of our business, and our strategic
direction.
"We are focused on serving our customers, helping them navigate
market headwinds, and enabling a mortgage process that is better,
faster, cheaper, and safer.
"That means we have a responsibility to innovate, while maintaining
our strong commitment to safety, soundness, and stewardship on
behalf of taxpayers."
Business Highlights
* Fannie Mae provided $122 billion in liquidity to the single-
family mortgage market in the third quarter of 2018 while
serving as the largest issuer of single-family mortgage-
related securities in the secondary market. The company's
estimated market share of new single-family mortgage-related
securities issuances was 40% for the third quarter of 2018.
* Fannie Mae has transferred a portion of the mortgage credit
risk on single-family mortgages with an unpaid principal
balance of approximately $1.5 trillion at the time of the
transactions since 2013, and approximately 38% of the loans
in the company's single-family conventional guaranty book of
business were covered by a credit risk transfer transaction
as of Sept. 30, 2018.
* Fannie Mae expects to complete a new CAS REMIC transaction in
November 2018. Under the CAS REMIC program, the company will
be able to align the timing of its recognition of provisions
for credit losses with the related recovery from CAS
transactions, limit investors' exposure to Fannie Mae
counterparty risk, and broaden the investor base by expanding
participation for real estate investment trusts (REITs) and
international investors.
* Fannie Mae provided $18.2 billion in multifamily financing in
the third quarter of 2018, which enabled the financing of
206,000 units of multifamily housing. More than 90% of the
multifamily units the company financed were affordable to
families earning at or below 120% of the area median income,
providing support for both affordable and workforce housing.
* Fannie Mae continued to share credit risk with lenders on
nearly 100% of the company's new multifamily business volume
through its Delegated Underwriting and Servicing (DUS)
program. To complement the company's lender loss sharing
program, in August 2018 the company completed its third
multifamily Credit Insurance Risk Transfer (CIRT)
transaction, which covered multifamily loans with an unpaid
principal balance of approximately $11.1 billion.
Credit Risk Transfer Transactions
In late 2013, Fannie Mae began entering into credit risk transfer
transactions with the goal of transferring, to the extent
economically sensible, a portion of the mortgage credit risk on
some of the recently acquired loans in its single-family book of
business in order to reduce the economic risk to the company and
taxpayers of future borrower defaults. Fannie Mae's primary method
of achieving this goal has been through the issuance of its
Connecticut Avenue Securities (CAS) and its Credit Insurance Risk
Transfer (CIRT) transactions. In these transactions, the company
transfers to investors a portion of the credit risk associated with
losses on a reference pool of mortgage loans and in exchange pays
investors a premium that effectively reduces the guaranty fee
income the company retains on the loans.
As a part of Fannie Mae's continued effort to innovate and improve
its credit risk transfer programs, the company is in the process of
executing an enhancement to its credit risk transfer securities
that will enable the company to structure future CAS offerings as
notes issued by a trust that qualifies as a Real Estate Mortgage
Investment Conduit (REMIC). The new REMIC structure will differ
from the prior CAS notes that were issued as Fannie Mae corporate
debt. Under the prior CAS structure, there can be a significant
lag between the time when Fannie Mae recognizes a provision for
credit losses and when the company recognizes the related recovery
from the CAS transaction. Under current accounting rules, while a
credit expense on a loan in a reference pool for a CAS transaction
is recorded when it is probable that Fannie Mae has incurred a
loss, for the company's CAS issued beginning in 2016, a recovery is
recorded only when an actual loss event occurs, which is typically
several months after the collateral has been liquidated. The new
CAS structure will eliminate this timing mismatch, allowing Fannie
Mae to recognize the credit loss protection benefit at the same
time the credit loss is recognized in the company's condensed
consolidated financial statements.
The enhancements to the company's CAS program are designed to
promote the continued growth of the market by expanding the
potential investor base for these securities and limiting investor
exposure to Fannie Mae counterparty risk, without disrupting the
To-Be-Announced (TBA) MBS market. Fannie Mae expects to issue CAS
under the new REMIC structure in November 2018.
Fannie Mae continued to transfer a portion of the credit risk on
multifamily mortgages, and nearly 100% of the company's new
multifamily business volume had lender risk-sharing primarily
through the company's Delegated Underwriting and Servicing (DUS)
model in the third quarter of 2018. To complement the company's
lender loss sharing program through DUS, Fannie Mae also
transferred a portion of the mortgage credit risk on multifamily
loans in its multifamily guaranty book of business to insurers or
reinsurers through multifamily Credit Insurance Risk Transfer
(CIRT) transactions. In August 2018, the company completed its
third multifamily CIRT transaction since the inception of the
program, which covered multifamily loans with an unpaid principal
balance of approximately $11.1 billion.
Financial Performance Outlook
Fannie Mae expects to remain profitable on an annual basis for the
foreseeable future; however, certain factors could result in
significant volatility in the company's financial results from
quarter to quarter or year to year. Fannie Mae expects volatility
from quarter to quarter in its financial results due to a number of
factors, particularly changes in market conditions that result in
fluctuations in the estimated fair value of the financial
instruments that it marks to market through its earnings. Other
factors that may result in volatility in the company's quarterly
financial results include developments that affect its loss
reserves, such as changes in interest rates, home prices or
accounting standards, or events such as natural disasters.
The potential for significant volatility in the company's financial
results could result in a net loss in a future quarter. The company
is permitted to retain up to $3.0 billion in capital reserves as a
buffer in the event of a net loss in a future quarter. However,
any net loss the company experiences in the future could be greater
than the amount of its capital reserves, resulting in a net worth
deficit for that quarter.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/RErHZk
About Fannie Mae's Conservative and
Agreements with Treasury
Fannie Mae has operated under the conservatorship of FHFA since
Sept. 6, 2008. Treasury has made a commitment under a senior
preferred stock purchase agreement to provide funding to Fannie Mae
under certain circumstances if the company has a net worth deficit.
Pursuant to this agreement and the senior preferred stock the
company issued to Treasury in 2008, the conservator has declared
and directed Fannie Mae to pay dividends to Treasury on a quarterly
basis for every dividend period for which dividends were payable
since the company entered into conservatorship in 2008.
Fannie Mae expects to pay Treasury a fourth quarter 2018 dividend
of $4.0 billion by Dec. 31, 2018. The current dividend provisions
of the senior preferred stock provide for quarterly dividends
consisting of the amount, if any, by which the company's net worth
as of the end of the immediately preceding fiscal quarter exceeds a
$3.0 billion capital reserve amount. The company refers to this as
a "net worth sweep" dividend. The company's net worth was $7.0
billion as of Sept. 30, 2018.
If Fannie Mae experiences a net worth deficit in a future quarter,
the company will be required to draw additional funds from Treasury
under the senior preferred stock purchase agreement to avoid being
placed into receivership. As of Nov. 2, 2018, the maximum amount
of remaining funding under the agreement is $113.9 billion. If the
company were to draw additional funds from Treasury under the
agreement with respect to a future period, the amount of remaining
funding under the agreement would be reduced by the amount of its
draw. Dividend payments Fannie Mae makes to Treasury do not
restore or increase the amount of funding available to the company
under the agreement.
About Fannie Mae and Freddie Mac
Federal National Mortgage Association (OTCQB: FNMA), commonly known
as Fannie Mae -- http://www.FannieMae.com/-- is a
government-sponsored enterprise (GSE) that was chartered by U.S.
Congress in 1938 to support liquidity, stability and affordability
in the secondary mortgage market, where existing mortgage-related
assets are purchased and sold. Through its single-family and
multifamily business segments, the Company provided approximately
$570 billion in liquidity to the mortgage market in 2017, which
enabled the financing of approximately 3 million home purchases,
refinancings or rental units.
A brother organization of Fannie Mae is the Federal Home Loan
Mortgage Corporation (FHLMC), better known as Freddie Mac. Freddie
Mac (OTCBB: FMCC) -- http://www.FreddieMac.com/-- was established
by Congress in 1970 to provide liquidity, stability and
affordability to the nation's residential mortgage markets.
Freddie Mac supports communities across the nation by providing
mortgage capital to lenders.
FATE RESTAURANTS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Fate Restaurants, LLC
dba Fate Brewing Company
dba Fate Ale House & Brewing Company
691 Tamarisk Court
Louisville, CO 80027
Business Description: Fate Restaurants, LLC, headquartered in
Boulder, Colorado, is a restaurant and
brewery company owned by Mike Lawinski.
Chapter 11 Petition Date: November 1, 2018
Court: United States Bankruptcy Court
District of Colorado (Denver)
Case No.: 18-19570
Judge: Hon. Thomas B. McNamara
Debtor's Counsel: Jeffrey Weinman, Esq.
WEINMAN & ASSOCIATES, P.C.
730 17th St., Ste. 240
Denver, CO 80202
Tel: 303-572-1010
E-mail: jweinman@epitrustee.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Mike Lawinski, manager.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at:
http://bankrupt.com/misc/cob18-19570_creditors.pdf
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/cob18-19570.pdf
FERMARALIZ CORP: Case Summary & 2 Unsecured Creditors
-----------------------------------------------------
Debtor: Fermaraliz Corp.
PO Box 2377
Coamo, PR 00769
Business Description: Fermaraliz Corp. owns in fee simple a
property located at Bo San Ildefonso
Carr 14 km 31.6, Coamo, PR 00769 with
a current value of $383,900.
Chapter 11 Petition Date: November 1, 2018
Court: United States Bankruptcy Court
District of Puerto Rico (Ponce)
Case No.: 18-06456
Judge: Hon. Edward A. Godoy
Debtor's Counsel: Modesto Bigas Mendez, Esq.
MODESTO BIGAS LAW OFFICE
PO Box 7462
Ponce, PR 00732
Tel: 787 844-1444
Fax: 787-842-4090
E-mail: modestobigas@yahoo.com
Total Assets: $389,300
Total Liabilities: $1,046,703
The petition was signed by Jose F. Espada Colon, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at:
http://bankrupt.com/misc/prb18-06456.pdf
FORTERRA INC: Bank Debt Trades at 8% Off
----------------------------------------
Participations in a syndicated loan under which Forterra
Incorporated is a borrower traded in the secondary market at 92.32
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 2.95 percentage points from the
previous week. Forterra Incorporated pays 300 basis points above
LIBOR to borrow under the $10 million facility. The bank loan
matures on October 25/2023. Moody's rates the loan 'B3' and
Standard & Poor's gave a 'B-' rating to the loan. 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 Friday, October 26.
GATEWAY WIRELESS: Seeks Authorization to Use Cash Collateral
------------------------------------------------------------
Gateway Wireless LLC seeks authorization from the U.S. Bankruptcy
Court for the Southern District of Illinois to use cash collateral
and all other collateral in which the Secured Lenders have an
interest.
In the normal course of business, the Debtor generates cash flow
from operations to fund working capital, capital expenditures and
for other general corporate purposes, the proceeds of which are
purportedly secured under the Loan Agreements. The Debtor has
immediate need to use cash collateral in order to minimize the
disruption of the its business, operate its business in an orderly
manner, maintain business relationships with vendors, suppliers and
customers, and pay employees and satisfy other operational and
working capital needs, all of which are necessary to preserve and
maximize the Debtor's going-concern value for the benefit of all
stakeholders.
As of the Petition Date, the Secured Debt, with an outstanding
total balance of $4,617,590, is memorialized by those certain Loan
Agreements, by and among Debtor and Belgrade State Bank, and those
certain Loan Agreements, by and between Debtor and Stearns Bank
National Association. The debts issued under the Loan Agreements
are secured by first priority security interest in certain assets
and property of the Debtor. The Debtor believes that there are
various other Lenders that may also claim to have interests in the
Pre-Petition Collateral.
The Secured Lenders will be granted valid and perfected, security
interests in, and liens on all of the right, title, and interest of
the Debtor in, to and under all present and after-acquired property
of the Debtor of any nature whatsoever including, without
limitation, all cash contained in any account of the Debtor, and
the proceeds of all causes of action. However, the Post-Petition
Collateral expressly excludes Avoidance Actions.
The Secured Lenders will also have a claim against the Debtor that
constitutes expenses of administration under sections 503(b)(1),
507(a) and 507(b) of the Bankruptcy Code with priority over any and
all administrative expenses of the kinds specified or ordered
pursuant to any provision of the Bankruptcy Code, and will at all
times be senior to the rights of the Debtor, and any successor
trustee or any creditor in these Chapter 11 Cases or, to the extent
permitted by applicable law, any subsequent proceeds under the
Bankruptcy Code. The 507(b) Claims, however, will not be paid with
the proceeds of Avoidance Actions.
The Debtor will continue to comply with the reporting requirements
of the Loan Documents and any further reasonable requirements
agreed to by Debtor and Secured Lenders.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/ilsb18-31491-9.pdf
About Gateway Wireless
Gateway Wireless LLC is a privately-held company in Glen Carbon,
Illinois, which operates in the telecommunications industry.
Gateway Wireless sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Ill. Case No. 18-31491) on Oct. 12,
2018. In the petition signed by Ryan F. Walker, president, the
Debtor estimated assets of $10 million to $50 million and
liabilities of $10 million to $50 million. Judge Laura K. Grandy
presides over the case. The Debtor tapped Carmody MacDonald P.C.
as its legal counsel.
GRAY TELEVISION: S&P Rates New $500MM Senior Unsecured Notes 'B+'
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issue-level rating and '4'
recovery rating to Atlanta-based television broadcaster Gray
Television Inc.'s proposed $500 million senior unsecured notes due
in 2027, raised its issue-level ratings on the company's
outstanding senior unsecured notes to 'B+' from 'B-', and revised
its recovery rating on the outstanding notes to '4' from '6'.
The raised issue-level rating on the outstanding notes reflects the
proposed shift in mix of secured and unsecured debt in financing
the acquisition of Raycom Media Inc. The notes issuance would
reduce the secured debt in the company's capital structure,
providing incremental recovery for the unsecured debt claims in our
hypothetical default scenario. With the revised capital structure,
the previously announced $2.15 billion term loan will be reduced to
$1.65 billion. The '4' recovery rating indicates our expectation
for average recovery of principal (30%-50%; rounded estimate: 30%)
in the event of a payment default.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors:
-- S&P's simulated default scenario contemplates a default in the
first half of 2022, stemming from a cyclical downturn, difficulty
integrating acquisitions, and competitive pressure from alternative
media.
-- Gray Television is the borrower on the first-lien credit
facility, which consists of a revolving credit facility, term loan,
and incremental term loan. The company's material domestic
subsidiaries guarantee the credit facility, and the credit facility
is secured by substantially all of the borrower's and guarantors'
assets, excluding real estate. Under the amended credit agreement,
the revolving credit facility is pari passu with the first-lien
term loans. S&P assumes that lenders would aim to maximize value in
a default scenario and pursue reorganization instead of
liquidation.
-- S&P values the company using a distressed EBITDA multiple of 7x
based on Gray's increased scale following the Raycom acquisition,
in line with that for larger peers like Sinclair and TEGNA Inc.,
and its leading local news audience ratings and good station
diversification in terms of geography and network affiliation.
Simulated default assumptions:
-- EBITDA at emergence: about $455 million
-- EBITDA multiple: 7x
-- Revolver 85% drawn in our simulated year of default
Simplified waterfall:
-- Net enterprise value (after 5% administrative costs): about $3
billion
-- Total first-lien debt: about $2.4 billion
--Recovery expectations: 90%-100% (rounded estimate: 95%)
-- Total unsecured claims: about $1.8 billion
--Recovery expectations: 30%-50% (rounded estimate: 30%)
All debt amounts include six months of prepetition interest.
RATINGS LIST
Gray Television Inc.
Issuer Credit Rating B+/Stable/--
New Rating
Gray Television Inc.
Senior Unsecured
$500 mil notes due 2027 B+
Recovery Rating 4 (30%)
Issue-level Ratings Raised; Recovery Rating Revised
Gray Television Inc.
To From
Senior Unsecured B+ B-
Recovery Rating 4(30%) 6(0%)
GREEN NATION: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: Green Nation Direct, Corporation
18631 Sherman way, Suite B
Reseda, CA 91335
Business Description: Green Nation Direct, Corporation is a
privately held architectural design company
that specializes in a variety of interior
design and spatial planning projects.
Based in Los Angeles, California, the
Company provides bathroom remodeling,
demolition, earthquake retrofitting, energy-
efficient homes, foundation construction,
foundation repair, garage building, general
contracting, green building, home additions,
home remodeling, kitchen remodeling, new
home construction, project management, roof
installation, roof repair, roof replacement,
and roof waterproofing, among other
services.
Chapter 11 Petition Date: November 2, 2018
Court: United States Bankruptcy Court
Central District of California (San Fernando Valley)
Case No.: 18-12698
Judge: Hon. Maureen Tighe
Debtor's Counsel: Giovanni Orantes, Esq.
THE ORANTES LAW FIRM, A.P.C.
3435 Wilshire Blvd Ste 2920
Los Angeles, CA 90010
Tel: 888-619-8222
Fax: 877-789-5776
E-mail: go@gobklaw.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Raul U. Segovia, president and CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/cacb18-12698.pdf
GRGCBHS LLC: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: GRGCBHS, LLC
7920 Bucksducks Road
Tillar, AR 71670
Business Description: GRGCBHS, LLC is a privately held
company in Tillar, Arkansas in the
traveler accommodation industry.
Its principal assets are located at
305 Malvern Avenue Hot Springs National, AR
71901.
Chapter 11 Petition Date: November 1, 2018
Court: United States Bankruptcy Court
Western District of Arkansas (Hot Springs)
Case No.: 18-72960
Judge: Hon. Judge Ben T. Barry
Debtor's Counsel: Kevin P. Keech, Esq.
KEECH LAW FIRM, PA
2011 S. Broadway St.
Little Rock, AR 72206
Tel: (501) 221-3200
Fax: 501-221-3201
Email: kkeech@keechlawfirm.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Gary R. Gibbs, manager.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/arwb18-72960.pdf
GULF FINANCE: Bank Debt Trades at 17% Off
-----------------------------------------
Participations in a syndicated loan under which Gulf Finance LLC is
a borrower traded in the secondary market at 82.56
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.89 percentage points from the
previous week. Gulf Finance pays 525 basis points above LIBOR to
borrow under the $11 million facility. The bank loan matures on
August 25, 2023. Moody's rates the loan 'B3' and Standard & Poor's
gave a 'B' rating to the loan. 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 Friday,
October 26.
HOUGHTON MIFFLIN: Bank Debt Trades at 7% Off
--------------------------------------------
Participations in a syndicated loan under which Houghton Mifflin
Harcourt Publishers Inc. is a borrower traded in the secondary
market at 92.75 cents-on-the-dollar during the week ended Friday,
October 26, 2018, according to data compiled by LSTA/Thomson
Reuters MTM Pricing. This represents a decrease of 1.07 percentage
points from the previous week. Houghton Mifflin pays 300 basis
points above LIBOR to borrow under the $80 million facility. The
bank loan matures on May 29, 2021. Moody's rates the loan 'Caa2'
and Standard & Poor's gave a 'B' rating to the loan. 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 Friday, October 26.
INPIXON: Implements Reverse Stock Split for NASDAQ Compliance
-------------------------------------------------------------
Inpixon's Board of Directors has approved a reverse stock split of
the Company's common stock whereby every 40 shares of its
outstanding common stock will automatically be combined into one
share of common stock. The reverse split was approved by the
Company's shareholders on Oct.31, 2018 and will be effective as of
the commencement of trading on Nov. 2, 2018. The reverse stock
split is being implemented for the purpose of complying with the
closing bid price requirement in Nasdaq Listing Rule 5550(a)(2).
Amendment to the 2018 Plan
The board of directors of Inpixon approved the Amendment No. 2 to
the 2018 Employee Stock Incentive Plan to, among other things, (i)
permit the Company to grant an amount of incentive stock options
equal to the maximum number of shares of common stock that may be
issued under the Plan including such additional shares of common
stock that become issuable pursuant to the Plan's automatic
quarterly increases and (ii) no longer reduce the amount of shares
of common stock that may be issued under the Plan in connection
with a change in the outstanding shares of common stock by reason
of stock dividends, stock splits, reverse stock splits,
recapitalizations, mergers, consolidations, combinations or
exchanges of shares, separations, reorganizations or liquidations.
The Amendment was approved by the stockholders at the meeting.
Annual Meeting Results
On Oct. 31, 2018, the Company held its 2018 annual meeting of
stockholders at which the Stockholders:
(1) elected Nadir Ali, Leonard A. Oppenheim, Kareem M. Irfan
and Tanveer A. Khader as directors to serve until the next
annual meeting or until the election and qualification of
his successor;
(2) approved an amendment to the Company's Articles of
Incorporation to effect a reverse stock split of its
outstanding Common Stock at a ratio between 1-for-2 and
1-for-50, to be determined at the discretion of the
Company's board of directors, for the purpose of complying
with Nasdaq Listing Rule 5550(a)(2), subject to the Board's
discretion to abandon such amendment;
(4) approved the issuance of shares of Common Stock in one or
more potential non-public transactions or debt for equity
conversion transactions in accordance with Nasdaq Listing
Rule 5635(d);
(5) approved an amendment to the Company's 2018 Employee Stock
Incentive Plan; and
(6) ratified the appointment of Marcum LLP as the Company's
independent registered public accounting firm for the fiscal
year ending Dec. 31, 2018.
At the time of the Annual Meeting, there were insufficient votes to
pass Proposal 3, which sought to approve an amendment to the
Articles of Incorporation to increase the Company's authorized
shares of Common Stock from 250,000,000 to 1,000,000,000. As
provided in the Company's bylaws and with the authority of the
proxies granted as set forth in the Proxy Statement, stockholders
holding a majority of the shares represented at the meeting and
entitled to vote have voted in favor of a motion to adjourn the
meeting with respect to the votes for Proposal 3 in order to
solicit additional proxies for such proposal. As announced at the
Annual Meeting, such meeting will reconvene at 10:00 a.m. Pacific
Time on Nov. 15, 2018 at the offices of the Company, located at
2479 E. Bayshore Road, Suite 195, Palo Alto, CA 94303. During the
period of adjournment, the Company will continue to accept
stockholder votes on Proposal 3.
About Inpixon
Headquartered in Palo Alto, California, Inpixon is a technology
company that helps to secure, digitize and optimize any premises
with Indoor Positioning Analytics (IPA) for businesses and
governments in the connected world. Inpixon Indoor Positioning
Analytics is based on new sensor technology that finds all
accessible cellular, Wi-Fi, Bluetooth and RFID signals anonymously.
Paired with a high-performance, data analytics platform, this
technology delivers visibility, security and business intelligence
on any commercial or government premises world-wide. Inpixon's
products, infrastructure solutions and professional services group
help customers take advantage of mobile, big data, analytics and
the Internet of Things (IoT).
As of Oct. 17, 2018, the Company has issued and outstanding
62,115,129 shares of common stock and 1 share of Series 4
convertible preferred stock which is convertible into 5,622 shares
of common stock.
Inpixon reported a net loss of $35.03 million on $45.13 million of
total revenues for the year ended Dec. 31, 2017, compared to a net
loss of $27.50 million on $53.16 million of total revenues for the
year ended Dec. 31, 2016. As of June 30, 2018, Inpixon had $24.89
million in total assets, $22.27 million in total liabilities and
$2.61 million in total stockholders' equity.
Marcum LLP, in New York, the Company's auditor since 2012, issued a
"going concern" opinion in its report on the Company's consolidated
financial statements for the year ended Dec. 31, 2017, citing that
the Company has a significant working capital deficiency, has
incurred significant losses and needs to raise additional funds to
meet its obligations and sustain its operations. These conditions
raise substantial doubt about the Company's ability to continue as
a going concern.
Nasdaq Noncompliance
Inpixon received a letter from the Listing Qualifications Staff of
The Nasdaq Stock Market LLC on May 17, 2018, indicating that, based
upon the closing bid price of the Company's common stock for the
last 30 consecutive business days beginning on April 5, 2018 and
ending on May 16, 2018, the Company no longer meets the requirement
to maintain a minimum bid price of $1 per share, as set forth in
Nasdaq Listing Rule 5550(a)(2). In accordance with Nasdaq Listing
Rule 5810(c)(3)(A), the Company has been provided a period of 180
calendar days, or until Nov. 13, 2018, in which to regain
compliance.
J.P. QUESOS: Plan Exclusivity Period Extended to Nov. 19
--------------------------------------------------------
The Hon. Eduardo V. Rodriguez of the U.S. Bankruptcy Court for the
Southern District of Texas, at the behest of J.P. Quesos San
Miguel, LLC, has extended (a) the exclusivity period and deadline
by which the Debtor must file a combined disclosure statement and
small business plan of reorganization to Nov. 19, 2018, and (b) the
deadline to confirm a Chapter 11 Small Business Plan of
Reorganization for a period of 60-days through January 18, 2019.
As reported by the Troubled Company Reporter on October 31, 2018,
the Debtor sought for an extension of the exclusive periods as a
means of relief, such that Debtor has adequate time to devote
resources to negotiating the terms for the sale of the facilities
that will result in sale proceeds beneficial to all creditors.
About J.P. Quesos San Miguel LLC
J.P. Quesos San Miguel, LLC, sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. S.D. Texas Case No. 18-10121) on April
30, 2018. At the time of the filing, the Debtor disclosed that it
had estimated assets of less than $1 million and liabilities of
less than $1 million. Judge Eduardo V. Rodriguez presides over the
case. The Debtor tapped Marcos D. Oliva, P.C. as its legal counsel;
and Realty Executives as real estate broker.
JDS HOSPITALITY: Needs Access to Cash Through September 2019
------------------------------------------------------------
JDS Hospitality Group seeks authorization from the U.S. Bankruptcy
Court for the Central District of California to use any and all
cash collateral now on hand or hereafter collected, in accordance
with the budget.
The Debtor's projections, which are based upon past operating
pre-petition results and conservative assumptions regarding future
operations, indicate that the Debtor will continue to create value
through its operations from October 1, 2018 through September 30,
2019.
The following entities claim a security interest on the Debtor's
assets (alleged interest on cash collateral specified):
(a) First Choice Bank, claims an estimated alleged balance of
$3,445,345, secured by a First Deed of Trust on the Real Property
located at 818 Real Road, Bakersfield, CA 90703 and Assignment of
Rents;
(b) First Choice Bank, claims an estimated alleged balance of
$350,056, secured by personal property including furniture,
fixtures, or equipment of the Real Property, accounts receivable,
instruments, contract rights and other rights to money, including
after acquired general intangibles;
(c) On Deck Capital, Inc./Secured Lender Solutions, claims an
estimated alleged balance of $87,500, secured with accounts
receivable, instruments, contract rights and other rights to money,
including after acquired general intangibles;
(d) Yellowstone Capital West, LLC, asserts an estimated
alleged balance of $100,000, secured by accounts receivable,
instruments, contract rights and other rights to money, including
after acquired general intangibles; and
(e) Forward Financing, LLC, claiming an estimated alleged
balance of $75,000, secured by future accounts receivables.
The Debtor contends that its recent post-petition operating results
and future projections indicate that this trend will continue and
improve over the next year, providing ample adequate protection to
the Lenders' interests. Moreover, as additional adequate protection
the Debtor will include the following provision in the cash
collateral order:
(1) The Lenders will receive a replacement lien on
post-petition assets having the same priority, scope and rights
under applicable law as the Lender's prepetition lien.
(2) The Lenders will receive, through the Debtor's filing with
the Court or otherwise as requested by the Lenders, monthly
operating reports as required by the Office of the United States
Trustee, which will show cash usage and monthly income statements.
The Debtor has no reason to believe that value of the Real Property
or the furniture, fixtures, or equipment of the Real Property is
declining in value. However, the Debtor also proposes additional
adequate protection by way of adequate protection payments to the
secured creditor First Choice Bank, the first Trust Deed Holder on
the Real Property and Furniture Fixtures and Equipment of the Real
Property in the monthly amount of $20,000.
The Debtor proposes to make adequate protection payments by the
first of each month commencing on November 1, 2018 through and
until the earlier of either (i) the effective date of any confirmed
plan of reorganization; (ii) dismissal of the case (iii) further
order of the Court.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/cacb18-22059-4.pdf
About JDS Hospitality Group
JDS Hospitality Group LLC is a privately held company in El Monte,
California, in the hotel or motel management business. JDS
Hospitality Group filed a Chapter 11 petition (Bankr. C.D. Cal.
Case No. 18-22059) on Oct. 14, 2018. In the petition signed by
Rhonda Chung, president, the Debtor disclosed $4,641,552 in total
assets and $4,840,684 in total debt. The case is assigned to Judge
Neil W. Bason. The Debtor is represented by Christopher J.
Langley, Esq. of the Law Offices of Langley & Chang.
JONES ENERGY: Files Form 10-Q for the Quarter Ended Sept. 30, 2018
------------------------------------------------------------------
Jones Energy, Inc. has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting a net loss
attributable to common shareholders of $35.04 million on $59.72
million of total operating revenues for the three months ended
Sept. 30, 2018, compared to a net loss attributable to common
shareholders of $66.77 million on $44.20 million of total operating
revenues for the same period in 2017.
For the nine months ended Sept. 30, 2018, the Company reported a
net loss attributable to common shareholders of $105.85 million on
$182.47 million of total operating revenues compared to a net loss
attributable to common shareholders of $154.36 million on $134.06
million of total operating for the nine months ended Sept. 30,
2017.
As of Sept. 30, 2018, Jones Energy had $1.78 billion in total
assets, $1.24 billion in total liabilities, $93.45 million in
series A preferred stock, and $449.26 million in total
stockholders' equity.
Jones Energy stated in the Quarterly Report that, "Historically,
our primary sources of liquidity have been private and public sales
of our debt and equity, borrowings under bank credit facilities and
cash flows from operations. Our primary use of capital has been
for the exploration, development and acquisition of oil and gas
properties. As we pursue development of our assets and reserves
and production growth, we continually consider which capital
resources, including equity and debt financings, are available to
meet our future financial obligations, planned capital expenditure
activities and liquidity requirements. Our ability to maintain and
grow proved reserves and production will be highly dependent on the
capital resources available to us. We strive to maintain financial
flexibility in order to facilitate drilling on our undeveloped
acreage positions and permit us to selectively expand our acreage
positions. We are likely to be required to generate or raise
significant amounts of capital to develop all of our potential
drilling locations should we endeavor to do so. In the event our
profitability or cash flows are insufficient and other sources of
capital we historically have utilized are not available on
acceptable terms, we may curtail our capital spending.
"Our balance sheet at September 30, 2018 reflects a substantial
cash position as a result of the issuance of the 2023 First Lien
Notes. We intend to use this cash balance to meet future financial
obligations and planned capital expenditure activities. However, we
are currently operating at a net loss and we may have difficulty
accessing other sources of capital, including through private and
public sales of debt and equity or borrowings under credit
facilities. As a result, we may be unable to generate additional
cash to meet financial obligations and planned capital
expenditures.
"The amount, timing and allocation of capital expenditures are
largely discretionary and within management's control. If oil and
gas prices decline to levels below our acceptable levels or costs
increase to levels above our acceptable levels, we may choose to
defer some or all of our planned capital expenditures until later
periods in order to achieve the desired balance between sources and
uses of liquidity and to prioritize capital projects that we
believe have the highest expected returns and potential to generate
near-term cash flow. We may also increase our capital expenditures
significantly to take advantage of opportunities we consider to be
attractive. We continuously monitor and adjust our projected
capital expenditures in response to success or lack of success in
drilling activities, changes in prices, availability of financing,
drilling and completion costs, industry conditions, the
availability of rigs, contractual obligations, internally generated
cash flow and other factors both within and outside our control."
Net cash provided by operating activities was $45.0 million during
the nine months ended Sept. 30, 2018 as compared to $41.4 million
during the nine months ended Sept. 30, 2017. The increase in
operating cash flows was primarily due to the $50.4 million
increase in oil and gas revenues for the nine months ended Sept.
30, 2018 as compared to the nine months ended Sept. 30, 2017,
driven by the increase in commodity prices and production volumes.
The increase in oil and gas revenues was offset by the impact of
commodity derivative losses during the nine months ended Sept. 30,
2018.
Net cash used in investing activities was $186.5 million during the
nine months ended Sept. 30, 2018 as compared to $47.5 million
during the nine months ended Sept. 30, 2017. The increase in
investing cash used was primarily driven by cash used toward
current period settlements of matured derivative contracts of $42.7
million during the nine months ended Sept. 30, 2018 as compared to
cash provided by current period settlements of matured derivative
contracts of $69.4 million during the nine months ended Sept. 30,
2017. Additionally, during the nine months ended Sept. 30, 2018
there were no significant divestitures. In contrast, during the
nine months ended Sept. 30, 2017, the Company closed on the Arkoma
Divestiture which resulted in investing cash flows of $52.8
million.
Net cash provided by financing activities was $215.7 million during
the nine months ended Sept. 30, 2018 as compared to $23.1 million
during the nine months ended Sept. 30, 2017. The increase in
financing cash flows was primarily due to the issuance of the 2023
First Lien Notes on Feb. 14, 2018. Upon issuance, the Company
received proceeds of $438.9 million. The Company used the proceeds
from the offering toward net repayments under the Revolver of
$211.0 million. On June 27, 2018, all outstanding borrowings under
the Revolver were repaid in full.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/X9X9xy
About Jones Energy
Austin, Texas-based Jones Energy, Inc. --
http://www.jonesenergy.com/-- is an independent oil and natural
gas company engaged in the development and acquisition of oil and
natural gas properties in the Anadarko basin of Oklahoma and Texas.
The Company's Chairman, Jonny Jones, founded its predecessor
company in 1988 in continuation of his family's long history in the
oil and gas business, which dates back to the 1920s.
Jones Energy reported a net loss attributable to common
shareholders of $109.4 million in 2017, a net loss attributable to
common shareholders of $45.22 million in 2016, and a net loss
attributable to common shareholders of $2.38 million in 2015.
NYSE Noncompliance
On March 23, 2018, the New York Stock Exchange notified the Company
that it was non-compliant with certain continued listing standards
because the price of the Company's Class A common stock over a
period of 30 consecutive trading days had fallen below $1.00 per
share, which is the minimum average closing price per share
required to maintain a listing on the NYSE.
KLOECKNER PENTAPLAST: Bank Debt Trades at 3% Off
------------------------------------------------
Participations in a syndicated loan under which Kloeckner
Pentaplast SA is a borrower traded in the secondary market at 96.56
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.62 percentage points from the
previous week. Kloeckner Pentaplast pays 425 basis points above
LIBOR to borrow under the $83 million facility. The bank loan
matures on June 17, 2022. Moody's rates the loan 'B3' and Standard
& Poor's gave a 'B' rating to the loan. 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
Friday, October 26.
Kloeckner Pentaplast SA is a Germany-based packaging company. It
is a large supplier of films for pharmaceutical, medical devices,
food, electronics, and general packaging. Its first production
facility outside Germany was opened in 1979 in Gordonsville,
Virginia, United States.
LA CANASTA: Case Summary & 15 Unsecured Creditors
-------------------------------------------------
Debtor: La Canasta Inc.
Avenida Luis Munoz Marin
E 22 Altos
Notre Dame
Caguas, PR 00725
Business Description: La Canasta Inc. is the fee simple owner of
four properties in Caguas, Gurabo, and Juana
Diaz, Puerto Rico having a total current
value of $3.84 million. The Company
previously sought bankruptcy protection on
Nov. 26, 2014 (Bankr. D. P.R. Case No. 14-
09826).
Chapter 11 Petition Date: November 1, 2018
Court: United States Bankruptcy Court
District of Puerto Rico (Old San Juan)
Case No.: 18-06453
Judge: Hon. Mildred Caban Flores
Debtor's Counsel: Carmen D. Conde Torres, Esq.
C. CONDE & ASSOC.
254 San Jose Street
5th Floor
San Juan, PR 00901-1523
Tel: 787-729-2900
Fax: 787-729-2203
Email: notices@condelaw.com
condecarmen@condelaw.com
Total Assets: $3,840,000
Total Liabilities: $4,214,778
The petition was signed by Ricardo Rivera Irizarry, sub
administrator.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 15 unsecured creditors is available for free
at:
http://bankrupt.com/misc/prb18-06453.pdf
LANDS' END: Bank Debt Trades at 4% Off
--------------------------------------
Participations in a syndicated loan under which Lands' End is a
borrower traded in the secondary market at 96.17
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 1.18 percentage points from the
previous week. Lands' End pays 325 basis points above LIBOR to
borrow under the $51 million facility. The bank loan matures on
April 4, 2021. Moody's rates the loan 'B-' and Standard & Poor's
gave a 'B-' rating to the loan. 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 Friday,
October 26.
LANNETT CO: Bank Debt Trades at 16% Off
---------------------------------------
Participations in a syndicated loan under which Lannett Co
Incorporated is a borrower traded in the secondary market at 84.00
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 2.51 percentage points from the
previous week. Lannett Co pays 538 basis points above LIBOR to
borrow under the $63 million facility. The bank loan matures on
June 20, 2022. Moody's rates the loan 'B3' and Standard & Poor's
gave a 'B' rating to the loan. 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 Friday,
October 26.
LMBE-MC HOLDCO II: Moody's Rates $475MM Secured Loans 'Ba3'
-----------------------------------------------------------
Moody's Investors Service assigned a Ba3 rating to LMBE-MC Holdco
II LLC's proposed $475 million senior secured credit facilities
consisting of a $450 million 7-year term loan and a $25 million
5-year revolving credit facility. The rating outlook is stable.
The Borrower owns two gas-fired electric generating facilities
located in Bangor, Pennsylvania: the 1,700 megawatt Martins Creek
Power Plant (MC) and the 600 megawatt Lower Mount Bethel Power
Plant (LMB). Proceeds from the term loan will be used to fund
near-term expenditures at MC that will allow the facility to comply
with NOx emission standards and to make a distribution to the
Borrower's 100% owner, Talen Energy Supply LLC (Talen: B2 CFR,
stable).
Rating Rationale
The Ba3 rating considers near-term cash flow certainty associated
with the forward sale of the Borrower's generating capacity
primarily through base residual capacity auctions in PJM, LMB's
competitive generating position enabling fairly reliable energy
margin, and a manageable debt profile, including a reasonable
amount of debt needing to be refinanced at maturity under various
sensitivities examined. The rating also considers the Borrower's
exposure to merchant power markets which can be accompanied by some
cash flow volatility and the somewhat weak recent operating profile
of MC. The credit facilities are non-recourse to Talen, as cash
flow generated by each of MC and LMB are the Borrower's sole
revenue source for debt repayment.
Revenue Profile
MC and LMB have participated in PJM's base residual capacity
auctions through auction year 2021/2022, which provide a solid
credit foundation. Based on capacity cleared, Moody's anticipates
MC and LMB will earn approximately $300 million of capacity revenue
during the period 2019 through May 2022 and, based on Moody's
outlook for capacity prices, approximately $90 million annually
thereafter. Capacity revenue will be supplemented with energy
margin earned primarily by LMB, a 600 megawatt (MW) combined cycle
power plant that achieved commercial operation in 2004 and has
operated in most years at a capacity factor in excess of 80%.
Moody's anticipates LMB to continue to operate in a sound and
efficient manner and, based on its pricing and production
estimates, generating approximately $30 million in annual recurring
energy margins.
MC has historically operated as a peaking asset and its capacity
factor has varied from a high of 30% to a low of 3% over the past
five years. It is expected that annual energy margin contribution
is dependent on various external factors and is highly uncertain.
Lengthy forced outage events in 2014, 2016 and 2017 add to the
uncertainty.
Financing Structure
The rating reflects Moody's forecasted key financial metrics for
the three year period of 2019 through 2021. Annual debt service
coverage is expected to be in a range of 2.0x-2.4x, annual project
cash flow to adjusted debt in a range of 10-14%, while annual
debt-to-EBITDA in a range of 4-5x. Moody's views these ranges as
commensurate with a Ba rating category.
The terms and conditions of the proposed financing provides for a
high degree of deleveraging during the seven year term, reducing
refinancing risk in its view. Based on its analysis, and
considering the quarterly mandatory cash sweep mechanism equal to
the greater of 50% of excess cash flow or up to 100% of excess cash
flow to achieve predetermined target debt levels, Moody's expects
debt remaining at maturity to be in a manageable range of $100-125
million.
The senior secured credit facilities will incorporate typical
project finance features including limitations on indebtedness and
asset sales, a trustee administered waterfall of accounts, a six
month debt service reserve, and a 1.1 times debt service coverage
covenant requirement.
The rating considers ring-fencing separateness provisions that will
be incorporated at the Borrower to insulate its credit profile from
that of Talen. These provisions include, among other things,
separate books, separate record and bank accounts, and the
maintenance of an arm's length relationship with its affiliate.
Additionally, as long as the Borrower is owned by 80% or more by
one entity, at least one independent manager is required to be a
Member of the Borrower's board and the written consent of the
independent manager is required for the company to take any
"material action", which would include a Borrower bankruptcy
filing.
Rating Outlook
The stable outlook assumes sound operating performance, merchant
energy margin contributions from both assets and debt service
coverage over the near-term in excess of 1.8 times.
What could move the rating up
The rating could be upgraded should the Borrower repay
substantially greater debt than expected or if it generates
financial metrics including debt-to-EBITDA of less than 3.0x on a
sustained basis.
What could move the rating down
The rating could be downgraded if either asset encounters major
operational difficulties or combined, generate less than $30
million of recurring annual energy margin leading to debt service
coverage declining to less than 1.9x on a sustained basis or
debt-to-EBITDA increasing to more than 6.5x.
The principal methodology used in these ratings was Power
Generation Projects published in June 2018.
LONGFIN CORP: Yogesh Patel Quits as Director
--------------------------------------------
Yogesh Patel has notified Longfin Corp of his resignation from the
Company's Board of Directors, effective Nov. 1, 2018. There were
no disagreements between Mr. Patel and the Company, according to a
Form 8-K filed with the Securities and Exchange Commission.
About Longfin
Longfin Corp (LFIN) is a U.S.-based, global finance and technology
company ("FINTECH") powered by artificial intelligence (AI) and
machine learning. The Company, through its wholly-owned
subsidiary, Longfin Tradex Pte. Ltd, delivers FX and alternative
finance solutions to importers/exporters and SME's. Ziddu.com
owned by the company is the only marketplace for smart contracts on
the Ethereum blockchain. Ziddu Ethereum ERC20 blockchain Token
uses a technology stack in which Smart Contracts run in distributed
virtual machines, intended to provide solutions to warehouse /
international trade financing, micro-lending, FX OTC derivatives,
bullion finance, and structured products. Currently, the company
has operations in Singapore, Dubai, New York and India.
For the period from Feb. 1, 2017 (inception) through Dec. 31, 2017,
Longfin incurred a net loss of $26.36 million. As of Dec. 31,
2017, Longfin had $178.25 million in total assets, $39.29 million
in total liabilities and $138.96 million in total stockholders'
equity.
As at June 30, 2018, Longfin had $172.79 million in total assets,
$44.91 million in total liabilities and $127.88 million in total
equity.
The report from the Company's independent accounting firm
CohnReznick LLP, in Roseland, New Jersey, on the consolidated
financial statements for the year ended Dec. 31, 2017, includes an
explanatory paragraph stating that the Company has limited
operating history and the continuation of the Company as a going
concern is dependent upon the ability of the Company to obtain
financing and the attainment of profitable operations. These
conditions raise substantial doubt about the Company's ability to
continue as a going concern.
The Securities and Exchange Commission had obtained a court order
freezing more than $27 million in trading proceeds from allegedly
illegal distributions and sales of restricted shares of Longfin
Corp. stock involving the company, its CEO, and three other
affiliated individuals. A federal judge in Manhattan unsealed the
SEC's complaint on April 6, 2018.
On April 18, 2018, Longfin received a notice from the NASDAQ Stock
Market LLC, indicating that the Company does not comply with the
NASDAQ Listing Rule 5250(c)(1) due to the Company not having
included the signatures of a majority of the members of its Board
of Directors in its Annual Report on Form 10-K for the year ended
Dec. 31, 2017 that it filed with the SEC on April 2, 2018.
SEC Litigation
At the beginning of April 2018, the SEC filed an action, entitled
Securities and Exchange Commission v. Longfin Corp., et al., 18
Civ. 2977 (DLC) before the Federal District Court for the Southern
District of New York. The Company and its CEO, Venkata Meenavalli
are named as defendants, as are three of the Company's stockholders
who made certain sales of Class A Common Stock. The SEC's
complaint alleges that the defendants violated Section 5 of the
Securities Act by either distributing or participating in the
distribution of the Company's securities to the public in
unregistered transactions. In connection with the Litigation, the
SEC moved for a temporary restraining order and asset freeze
relating to the assets of the three defendants who were
stockholders who made certain sales of Class A Common Stock. By
order dated April 23, 2018, the Disctrict Court vacated the
temporary restraining order and asset freeze with respect to the
Company and Mr. Meenavalli. By order dated May 1, 2018, the Court
granted the SEC's request for a preliminary injunction regarding
the assets of the other three defendants. On May 11, 2018, the
Company and Mr. Meenavalli filed a motion to dismiss the SEC's
complaint for failure to state a claim upon which relief can be
granted, and the three other defendants answered the complaint and
denied the allegations of wrongdoing against them. On May 29,
2018, the SEC filed a first amended complaint, which the Company
and Mr. Meenavalli answered on June 8, 2018. The SEC Litigation
has now entered the discovery phase. The Company is unable at this
time to express any opinion as to the outcome of this matter or any
potential remedies that may be sought against the Company or Mr.
Meenavalli at this early stage of the proceedings.
LSC COMMUNICATIONS: Moody's Affirms B1 CFR, Outlook Stable
----------------------------------------------------------
Moody's Investors Service affirmed LSC Communications, Inc.'s B1
corporate family rating, B1-PD probability of default rating, Ba1
senior secured revolving bank credit facility and B1 senior secured
term loan B ratings, and its B1 senior secured notes rating,
following the company's 31 October, 2018 announcement that it has
agreed to be acquired by Quad/Graphics, Inc. in an all-stock
transaction valued at approximately $1.4 billion, inclusive of
refinancing LSC's debt. LSC's SGL-2 speculative grade liquidity
rating remains unchanged as does its stable ratings outlook.
"We affirmed LSC's on the premise that all of the company's debts
will be repaid and refinanced at closing of its acquisition by
Quad/Graphics," said Bill Wolfe, a Moody's senior vice president.
In the intervening period, Wolfe said that Moody's assesses LSC's
credit profile on a stand-alone basis. Approximately concurrent
with the acquisition transaction closing, Moody's anticipates
withdrawing all of LSCs debt ratings as well as its ratings
outlook.
The following summarizes LSC's ratings and its actions:
Rating affirmations:
Corporate Family Rating, Affirmed at B1
Probability of Default Rating, Affirmed at B1-PD
Senior Secured Revolving Bank Credit Facility, Affirmed at Ba1
(LGD2)
Senior Secured Term Loan B, Affirmed at B1 (LGD4)
Senior Secured Notes/Debentures, Affirmed at B1 (LGD4)
Ratings Unchanged:
Speculative Grade Liquidity Rating, SGL-2
Outlook Action:
Outlook, Remains Stable
RATINGS RATIONALE
LSC Communications, Inc.'s, B1 corporate family rating is
constrained by declining commercial printing industry revenue
coupled with management's decision to allocate free cash flow on
print-related acquisitions rather than debt reduction. Acquisitions
and anticipated synergies carry execution risks. Moody's expects
adjusted leverage of debt/EBITDA remaining in the mid-3x range
through 2019 (4.2x at June 30, 2018), a level that is aggressive
given elevated business risks stemming from ongoing negative
organic growth in the commercial printing industry. LSC's credit
profile benefits from good aggregate scale (revenue of $3.9
billion), a flexible cost structure, ~$100 million per year of
liquidity-bolstering free cash flow before spending on
acquisitions, and good liquidity.
Rating Outlook
The stable outlook is based on expectations of EBITDA remaining
approximately flat, with acquisitions and synergies offsetting
estimated organic revenue contraction of about 4% per annum (7% in
2017), such that leverage of debt/EBITDA remains at ~3.5x through
2019 (4.2x at June 30, 2018).
Factors that Could Lead to an Upgrade
LSC's rating could be upgraded to Ba3 were Moody's to anticipate:
i) leverage of Debt/EBITDA being sustained below 3x (4.2x at June
30, 2018), along with ii) maintenance of solid liquidity
arrangements; and iii) solid operating fundamentals with stable
operating trends (organic growth and margins).
Factors that Could Lead to a Downgrade
LSC's rating could be downgraded to B2 were Moody's to anticipate:
i) leverage of Debt/EBITDA being sustained above 3.75x (4.2x at
June 30, 2018), or ii) were liquidity arrangements to deteriorate;
or iii) business' fundamentals to deteriorate, evidenced by, for
example, either margin compression or accelerating revenue
declines.
The principal methodology used in these ratings was Media Industry
published in June 2017.
Headquartered in Chicago, Illinois, LSC Communications, Inc. (LSC),
is a retail/advertising-centric print/publishing services and
office products company with annual sales of about $3.9 billion.
Headquartered in Sussex, Wisconsin, Quad/Graphics, Inc. (Quad) is a
publicly-traded leading North American commercial printing company.
Annual revenues are ~$4.2 billion with 90% from US operations, 5%
from South America and 4% from Europe.
M. D. MILLER TRUCKING: Case Summary & 8 Unsecured Creditors
-----------------------------------------------------------
Debtor: M. D. Miller Trucking & Topsoil, Inc.
14903 S. Center St., Suite 106
Plainfield, IL 60544
Business Description: M. D. Miller Trucking & Topsoil, Inc. is a
privately held trucking company in
Plainfield, Illinois.
Chapter 11 Petition Date: November 2, 2018
Court: United States Bankruptcy Court
Northern District of Illinois (Chicago)
Case No.: 18-30959
Judge: Hon. Jack B. Schmetterer
Debtor's Counsel: Ben L. Schneider, Esq.
SCHNEIDER & STONE
8424 Skokie Blvd., Suite 200
Skokie, IL 60077
Tel: 847-933-0300
Fax: 847-676-2676
E-mail: ben@windycitylawgroup.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Marlene D. Miller, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's eight unsecured creditors is available for
free at:
http://bankrupt.com/misc/ilnb18-30959.pdf
MARRIOTT VACATIONS: S&P Lowers Secured Debt Rating to 'BB+'
-----------------------------------------------------------
S&P Global Ratings lowered its issue-level rating on Orlando,
Fla.-based Marriott Vacations Worldwide Corp.'s secured debt
(issued by wholly owned subsidiary Marriott Ownership Resorts Inc.)
to 'BB+' from 'BBB-' and revised the recovery rating to '2' from
'1'. S&P said, "The '2' recovery rating indicates our expectation
for substantial (70% to 90%; rounded estimate: 85%) recovery in the
event of default. We removed the rating from CreditWatch, where we
had placed it with negative implications on Aug. 8, 2018."
S&P said, "At the same time, we raised our issue-level rating on
MORI's 5.625% unsecured exchange notes and MORI and ILG LLC's 6.25%
unsecured notes to 'BB' from 'BB-', and revised the recovery rating
to '4' from '5'. The '4' recovery rating reflects our expectation
for average (30% to 50%; rounded estimate: 35%) recovery in the
event of default. We removed the rating from CreditWatch, where we
had placed it with positive implications on Aug. 8, 2018.
"In addition, we raised our issue-level rating on Interval
Acquisition Corp.'s unsecured notes due 2023 to 'BB' from 'BB-' and
revised the recovery rating to '4' (rounded estimate: 35%) from
'6'. We removed the rating from CreditWatch, where we had placed it
with developing implications on Aug. 8, 2018."
The unsecured debt rating upgrade to 'BB' from 'BB-' and secured
debt rating downgrade to 'BB+' from 'BBB-' reflect the change in
recovery prospects following MVW's completion of its exchange offer
for ILG notes on Sept. 4, 2018 and the completion of its subsequent
change of control offer for the same notes on Oct. 19, 2018. The
company was unable to successfully exchange more than 50% of the
notes through the exchange offer. Even though more than 50% of the
notes were ultimately retired through the subsequent change of
control offer, ILG's covenants will remain in place, including a
liens test that limits the amount of collateral that can be pledged
to secured debt. S&P said, "Under our hypothetical default scenario
and distressed valuation, the secured lenders may not be made whole
as long as the liens test is in place because they would receive
less value directly from ILG and would share the remaining
unpledged ILG value on a pro rata basis with both MORI noteholders
and ILG noteholders. As a result, we believe there will be modestly
less value available for secured lenders than we originally
expected. However, since the value pledged to secured lenders is
capped by the liens test, and since ILG still guarantees 100% of
the debt issued by MORI, we believe there will be more value
available to unsecured noteholders in our hypothetical default
scenario."
S&P said, "Our stable outlook on MVW's issuer credit rating
reflects our expectation that strong timeshare contract sales and
cost synergies will allow MVW to sustain our measure of leverage
well below our 4.5x downgrade threshold over the next two years. We
forecast captive finance-adjusted net debt to EBITDA in the high-3x
area in 2018, and about 3x in 2019. We expect adjusted FFO to debt
in the high-teen percent area in 2018, improving to the mid-20%
area in 2019.
"We could lower the rating if we believed MVW would not sustain our
measure of leverage below 4.5x, likely the result of operating
underperformance, along with challenges integrating ILG and
achieving cost synergies. We could also lower ratings if risk in
the captive rises enough to impair the parent's risk profile, which
we believe could occur if the loss ratio in the captive increases
meaningfully, or if leverage in the captive increases and is
sustained above 5x debt to equity.
"We could raise the rating if we believed MVW would sustain our
measure of captive finance-adjusted debt to EBITDA under 3.5x,
incorporating acquisitions, shareholder returns, and volatility
over the economic cycle. The company's long-run leverage policy
range is up to 2.5x, and our measure of leverage is up to 1x higher
than the company's, so its policy range would likely translate into
our measure of leverage close to our 3.5x upgrade threshold. That
could leave little cushion to accommodate the high anticipated
volatility that timeshare sales exhibit over the economic cycle.
However, if the company commits to maintaining leverage at the low
end of its policy range and successfully integrates ILG, we could
consider higher ratings."
MDVIP LLC: Moody's Affirms B3 Corp. Family Rating, Outlook Stable
-----------------------------------------------------------------
Moody's Investors Service affirmed MDVIP LLC's B3 Corporate Family
Rating and B3-PD Probability of Default Rating. Moody's also
downgraded its senior secured first lien credit facility ratings to
B3 from B2. The ratings outlook is stable.
MDVIP will use the proceeds from a $75 million incremental first
lien term loan and existing cash to fully repay its existing $95
million second lien term loan (unrated). Pro forma adjusted
debt-to-EBITDA will decline to approximately 5.7 times, down from
6.1 times.
The downgrade of the senior secured first lien credit facility
ratings to B3 reflects the elimination of loss absorption
previously provided by the senior secured second lien term loan
which is being refinanced by the incremental first lien term loan.
The first lien debt, which includes a revolving credit facility and
the upsized term loan, will represent the preponderance of the
company's obligations following the proposed transaction.
Following is a summary of Moody's rating actions for MDVIP LLC:
Ratings affirmed:
Corporate Family Rating at B3
Probability of Default Rating at B3-PD
Ratings downgraded:
Senior secured first lien revolving credit facility expiring 2022
to B3 (LGD 3) from B2 (LGD 3)
Senior secured first lien term loan due 2024 to B3 (LGD 3) from B2
(LGD 3)
The ratings outlook is stable.
RATINGS RATIONALE
The B3 CFR broadly reflects MDVIP's modest scale and high financial
leverage. Moody's expects MDVIP's gross revenue to reach
approximately $400 million per annum ($160 million net of physician
payments) over the next 12-18 months. Further, Moody's estimates
MDVIP's pro forma adjusted debt-to-EBITDA will remain moderately
high -- near the 5.7 times level reported at June 30, 2018 -- but
noted the ability for the balance sheet to deleverage towards the
5.0 times range over this time horizon. The rating also reflects
MDVIP's singular business focus and high marketing costs. The
rating is supported, nonetheless, by relatively good visibility
into the company's revenue streams as a result of its
subscription-based business model. Moody's views favorably the
company's high retention rates -- both of its affiliated physicians
and subscribing members -- as well as its national footprint, with
a presence in 43 US states in what remains a very fragmented
market.
The stable ratings outlook reflects Moody's expectation of modestly
improving credit metrics and free cash flows given strong
anticipated year-over-year organic growth and good retention of the
company's contracted physicians and patient membership. The outlook
also reflects Moody's view that MDVIP will maintain conservative
financial policies and refrain from making debt-funded dividends
over the near-to-intermediate term.
The ratings could be upgraded if MDVIP effectively manages its
growth while achieving greater scale. Additionally, a strong
liquidity profile and debt-to-EBITDA sustained below 5.0 times
could prompt consideration of a prospective ratings upgrade.
The ratings could be downgraded if the company's operating
performance weakens. A downgrade could also occur if Moody's
becomes concerned about MDVIP's ability to effectively recruit and
maintain physicians and members. Finally, aggressive financial
policies, or a deterioration in the company's liquidity provisions,
could also warrant consideration of a prospective ratings
downgrade.
MDVIP LLC is a marketer of programs to access private healthcare
services for 302,000 member subscribers across the US. Its members
receive personalized preventative care and wellness services from
MDVIP's 924 affiliated physicians. The company's revenue was
approximately $327 million ($128 million net of physician payments)
for the twelve months ended June 30, 2018. MDVIP was acquired by
private equity firm Leonard Green & Partners in November 2017.
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
MELINTA THERAPEUTICS: Stonepine Has 6.2% Stake as of Oct. 24
------------------------------------------------------------
Stonepine Capital Management, LLC, Stonepine Capital, L.P., Jon M.
Plexico and Timothy P. Lynch disclosed in a Schedule 13G filed with
the Securities and Exchange Commission that as of Oct. 24, 2018,
they beneficially own 3,474,761 shares of common stock of Melinta
Therapeutics, Inc., which represent 6.2 percent of the shares
outstanding. Stonepine Capital Management is the general partner
and investment adviser of investment funds, including Stonepine
Capital, L.P. Mr. Plexico and Mr. Lynch are the control persons of
the General Partner. A full-text copy of the regulatory filing is
available for free at https://is.gd/tLVtad
About Melinta Therapeutics
New Haven, Connecticut-based Melinta Therapeutics, Inc. --
http://www.melinta.com/-- is a commercial-stage pharmaceutical
company focused on discovering, developing and commercializing
differentiated anti-infectives for the hospital and select
non-hospital, or community, settings that address the need for
effective treatments for infections due to resistant gram-negative
and gram-positive bacteria. The Company currently market four
antibiotics to treat a variety of infections caused by these
resistant bacteria.
Deloitte & Touche LLP, in Chicago, Illinois, the Company's auditor
since 2014, issued a "going concern" opinion in its report on the
consolidated financial statements for the year ended Dec. 31, 2017,
stating that the Company's recurring losses from operations and its
need to obtain additional capital raise substantial doubt about its
ability to continue as a going concern.
Melinta reported a net loss available to common shareholders of
$78.17 million in 2017, a net loss available to common shareholders
of $95.04 million in 2016, and a net loss available to common
shareholders of $94.92 million in 2015. As of June 30, 2018,
Melinta had $514.6 million in total assets, $253.7 million in total
liabilities and $260.97 million in total shareholders' equity.
MICROVISION INC: Will Sell $60 Million Worth of Securities
----------------------------------------------------------
Microvision, Inc., has filed with the Securities and Exchange
Commission a Form S-3 registration statement relating to the sale
from time to time of up to $60,000,000 of the Company's common
stock, preferred stock, or warrants in one or more transactions.
Microvision will provide specific terms of these securities and
offerings in supplements to this prospectus.
The Company's common stock is traded on The Nasdaq Global Market
under the symbol "MVIS." On Oct. 31, 2018, the closing price of
the Company's common stock on The Nasdaq Global Market was $1.08
per share.
A full-text copy of the regulatory filing is available for free
at:
https://is.gd/4RVSVc
About MicroVision
Based in Redmond, Washington, MicroVision, Inc. --
http://www.microvision.com/-- is the creator of PicoP scanning
technology, an ultra-miniature laser projection and sensing
solution for mobile consumer electronics, automotive head-up
displays and other applications. PicoP scanning technology is
based on the Company's patented expertise in micro-electrical
mechanical systems (MEMS), laser diodes, opto-mechanics, and
electronics and how those elements are packaged into a small form
factor, low power scanning engine that can display, interact and
sense, depending on the needs of the application.
MicroVision incurred net losses of $24.24 million in 2017, $16.47
million in 2016, and $14.54 million in 2015. As of Sept. 30, 2018,
the Company had $29.97 million in total assets, $17.92 million in
total liabilities and $12.04 million in total shareholders'
equity.
Moss Adams LLP, in Seattle, Washington, the Company auditor since
2012, issued a "going concern" opinion in their report on the
consolidated financial statements for the year ended Dec. 31, 2017,
stating that the Company has suffered recurring losses from
operations and has an accumulated deficit that raise substantial
doubt about its ability to continue as a going concern.
MIDATECH PHARMA: Has Until April 29 to Regain Nasdaq Compliance
---------------------------------------------------------------
Midatech Pharma was notified by the The Nasdaq Stock Market LLC on
Oct. 30, 2018 that its American Depositary Shares have not regained
the minimum $1.00 bid price per share requirement within the 180
calendar days following receipt of the May 1, 2018 notification
letter. However, NASDAQ has determined that the Company is
eligible for an additional 180 calendar day period, pursuant to
NASDAQ Listing Rule 5810(c)(3)(A), or until April 29, 2019, to
regain the minimum $1.00 bid price per share requirement. This
will be met, if at any time during this 180 days period, the
closing bid price of the Company's American Depositary Shares is at
least $1.00 for a minimum of ten consecutive business days.
The Company's ordinary shares are listed on the AIM Market of the
London Stock Exchange, and the Notification Letter from NASDAQ does
not affect the Company's compliance status with such listing.
Panmure Gordon (UK) Limited (Nominated Adviser and Broker)
Corporate finance: Freddy Crossley / Emma Earl
Corporate broking: James Stearns
+44 (0)20 7886 2500
Consilium Strategic Communications (Financial PR)
Mary Jane Elliott / Nicholas Brown / Angela Gray
+44 (0)20 3709 5700
midatech@consilium-comms.com
Westwicke Partners (US Investor Relations)
Chris Brinzey
+1 339 970 2843
chris.brinzey@westwicke.com
About Midatech Pharma
Based in Oxfordshire, United Kingdom, Midatech Pharma PLC --
http://www.midatechpharma.com/-- is an international specialty
pharmaceutical company focused on the research and development of a
pipeline of medicines for oncology and immunotherapy. Midatech
Pharma US is the Group's US commercial operation, with four cancer
supportive care products.
The report from the Company's independent accounting firm BDO LLP,
in Reading, United Kingdom, the Company's auditor since 2014, on
the consolidated financial statements for the year ended Dec. 31,
2017, includes an explanatory paragraph stating that the Company
has suffered recurring losses from operations and has an
accumulated deficit that raise substantial doubt about its ability
to continue as a going concern.
Midatech reported a loss before tax of GBP17.32 million in 2017
following a loss before tax of GBP29.32 million in 2016. As of
Dec. 31, 2017, Midatech had GBP$49.22 million in total assets,
GBP14.54 million in total liabilities and GBP34.67 million in total
equity.
N&A PRODUCE: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------
Debtor: N&A Produce & Grocery, Corp.
dba Pioneer Supermarket
1345 Castle Hl. Avenue
Bronx, NY 10462
Business Description: N&A Produce & Grocery, Corp. operates a
grocery store in Bronx, New York.
Chapter 11 Petition Date: November 1, 2018
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Case No.: 18-13336
Judge: Hon. James L. Garrity Jr.
Debtor's Counsel: Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
3099 Coney Island Avenue, 3rd Floor
Brooklyn, NY 11235
Tel: 718-513-3145
Fax: (347) 342-2156
Email: alla@kachanlaw.com
Total Assets: $555,300
Total Liabilities: $2,346,000
The petition was signed by Yokasta D. Medina, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 12 unsecured creditors is available for free
at:
http://bankrupt.com/misc/nysb18-13336.pdf
NEIGHBORS LEGACY: PCO Files 2nd Interim Report
----------------------------------------------
Susan N. Goodman, RN JD, the Patient Care Ombudsman for Neighbors
Legacy Holdings, et al., filed second interim report of her
evaluation regarding the quality of patient care provided at the
Debtors' various facilities.
Since filing the series of First Reports, the PCO engaged remotely
with various facility directors as well as with corporate clinical
leadership. The PCO also engaged with the Director of Clinical
Education managing quality data and reviewed September quality data
with no concerns noted. The Report states that, in large measure,
staff were anticipated to remain in place after sale confirmation.
Coverage agreements through sale closure were reached for those
facilities where staff planned to depart.
The PCO noted limited increases in agency coverage in some of the
Debtors' South Texas facilities. Moreover, the PCO confirmed that
the corporate lab and pharmacy team members remained in place
during the transition period given the compliance implications
associated with the amount of support provided through these roles.
PCO also confirmed that records were being assumed by all buyers.
A full-text copy of the Second Interim Report is available at:
http://bankrupt.com/misc/txsb18-33836-594.pdf
About Neighbors Legacy Holdings
Neighbors Legacy Holdings -- http://www.neighborshealth.com/-- and
its subsidiaries currently operate 22 freestanding emergency
centers throughout the State of Texas, including in the greater
Houston area, South Texas, El Paso, the Golden Triangle, the
Panhandle, and the Permian B sin. The Emergency Centers are
designed to offer an attractive alternative to traditional hospital
emergency rooms by reducing wait times, providing better working
conditions for physicians and staff, and giving patient care the
highest possible priority. The Debtors were founded in Houston in
2008 by nine emergency room physicians.
EDMG, LLC, Neighbors Legacy Holdings and several affiliates sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Tex. Lead Case No. 18-33836) on July 12, 2018. In the petition
signed by Chad J. Shandler, its chief restructuring officer, the
Debtor disclosed less than $50,000 in assets and less than $50,000
in liabilities. Shandler is with CohnReznick LLP.
Judge Marvin Isgur presides over the cases. John F Higgins, IV,
Esq., at Porter Hedges LLP, serves as counsel to the Debtors. They
hired Houlihan Lokey Capital, Inc., as investment bankers.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on July 23, 2018. The committee has hired Cole
Schotz P.C. as its legal counsel.
NEWFIELD EXPLORATION: S&P Places 'BB+' ICR on CreditWatch Positive
------------------------------------------------------------------
S&P Global Ratings placed all of its ratings on Texas-based oil and
gas exploration and production company Newfield Exploration Co.,
including the 'BB+' issuer credit rating, on CreditWatch with
positive implications.
The CreditWatch positive placement reflects that S&P will likely
upgrade Newfield following the close of its acquisition by
higher-rated Encana Corp. (BBB-/Watch Pos/--).
The transaction remains subject to the approval of Newfield's and
Encana's shareholders and other customary closing conditions. S&P
does not anticipate any major issues arising during that process.
S&P said, "If the transaction is completed as proposed, we will
likely raise our ratings on Newfield to equalize them with our
ratings on Encana. We will resolve the CreditWatch positive listing
around the close of the acquisition, which we expect to occur by
the end of the first quarter of 2019."
NINE WEST: Continued Plan Negotiation Delays Filing of Plan
-----------------------------------------------------------
Nine West Holdings, Inc., and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of New York to extend by
additional 78 days their exclusive periods to file and to solicit
votes on a chapter 11 plan through and including January 15, 2019
and March 16, 2019, respectively.
Additionally, the Debtors request the Court to enter the proposed
bridge order extending the Filing Exclusivity Period through and
including the later of (i) Nov. 13, 2018, the date of the hearing
for the Court's consideration of the Exclusivity Motion, and (ii)
the date on which the Court enters an order with respect to the
relief requested by the Motion.
A hearing to consider extension of the Exclusivity Periods will be
held on Nov. 13, 2018, at 10:00 a.m. Any responses or objections
are due on or before Nov. 6.
On Oct> 17, 2018, the Debtors filed an amended plan of
reorganization and the related disclosure statement. The proposed
Plan achieves a balance sheet restructuring that maximizes the
value of the Debtors' businesses and potential litigation assets
stemming from their 2014 buyout and related carve-out transactions
("2014 Transactions") as well as events thereafter.
The Debtors submit that there is sufficient cause to extend the
Exclusivity Periods. The Debtors relate that they have been
actively involved in stakeholder engagement throughout these cases,
and at all times have sought to maximize the value of their
business and their litigation assets. Following a targeted
marketing process that the Debtors conducted in consultation with
their creditor groups, as described further in the Disclosure
Statement, the Debtors have been engaged in substantive,
arm's-length negotiations with their stakeholders regarding the
terms of their ultimate reorganization. Throughout this process,
the Debtors kept all stakeholders, including the advisors to their
debtor-in-possession financing lenders and the Committee, apprised
of the status and the substance of the ongoing discussions.
The Debtors assert that they have explored and exchanged proposals
regarding a number of restructuring alternatives, including a plan
based on a rights offering by their unsecured noteholders, a plan
contemplating a litigation trust, and a plan contemplating a
settlement of certain claims and causes of action related to the
2014 Transactions. Regardless of which stakeholder the Debtors were
negotiating with, the Debtors claim that the negotiations were
hard-fought, as the Debtors sought to obtain the highest recoveries
for all stakeholders, as opposed to a particular constituency.
After extensive, good-faith negotiations, the Debtors contend they
achieved consensus among their debtor-in-possession ABL/FILO
Lenders, an Ad Hoc Group of Secured Term Loan Holders, an Ad Hoc
Group of Secured and Unsecured Term Loan Holders, Brigade Capital
Management, L.P., and their equity sponsors with respect to the
Plan. The Plan constitutes a material step forward in these
chapter 11 cases: it substantially reduces the Debtors' aggregate
funded debt, obtains material concessions and contributions from
their consenting creditors and equity sponsors, and, most
importantly, provides the Debtors with a viable path to emergence
from chapter 11.
The Debtors submit that the proposed Plan is the culmination of
months of negotiations and related diligence and investigations
into the Debtors' assets by, among others, the Debtors' Independent
Directors and their Advisors, the Secured Term Loan Lenders, the
Unsecured Term Loan Lenders, the Unsecured Noteholders, the
Indirect Equity Owners, and the Official Committee of Unsecured
Creditors.
The Debtors represent that the Plan currently has the support of
more than 85% of the Secured Term Loan Lenders and more than 80% of
the Unsecured Term Loan Lenders -- funded debt holders with claims
against all Debtor entities. At the same time, the proposed Plan
does not represent a conclusion to discussions with the Debtors'
other stakeholders, including the Committee and the Debtors'
Noteholders. Accordingly, the Debtors will continue to negotiate
with those stakeholders regarding the terms of the Plan and the
path forward for the Debtors' emergence from chapter 11.
Indeed, the Plan is subject to the Debtors' fiduciary duties to
maximize the value of their estates. The Debtors, therefore, will
continue to review all options for their primary business and
litigation assets, and remain willing and able to talk to all
parties regarding alternative viable and feasible chapter 11
plans.
The Debtors claim that exclusivity has been the lynchpin for their
substantial progress in these chapter 11 cases. Plan negotiations
have occurred against the backdrop of what all parties recognize
are large and highly complex chapter 11 cases involving more than a
billion dollars of funded debt and a diverse set of stakeholder
constituencies, each with competing interests. The Debtors assert
that the requested brief exclusivity extension will permit the
Debtors to build on this progress without the substantial
disruption or delay that would result if parties were permitted to
file competing plans at this critical juncture.
The Debtors believe that the continued exclusivity will foster
their ability to engage with their stakeholders to further develop
consensus around the Plan if at all reasonably possible and, if
full consensus is not possible, permit the Debtors and their
stakeholders to focus on the hearing on the approval of the
Disclosure Statement and, ultimately, confirmation.
About Nine West
Nine West Holdings Inc. is a footwear, accessories, women's
apparel, and jeanswear company with a portfolio of brands that
includes Nine West, Anne Klein, and Gloria Vanderbilt. The company
is a wholesale partner to major U.S. retailers and has
international licensing arrangements covering more than 1,200
points of sale around the world.
In April 2014, Sycamore Partners Management, L.P., acquired The
Jones Group Inc. for $2.2 billion via leveraged buyout. As part of
the transaction, The Jones Group merged with several affiliates,
and the newly merged company was renamed as Nine West Holdings.
On April 6, 2018, Nine West Holdings, Inc., and 10 affiliates
sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No.
18-10947) to right size their balance sheet, sell the Nine West
Group's assets, and execute on their turnaround strategy to
concentrate exclusively on their One Jeanswear Group, Kasper Group,
The Jewelry Group, and Anne Klein businesses.
In addition to the chapter 11 cases, Jones Canada, Inc., and Nine
West Canada LP commenced foreign insolvency proceeding under the
Bankruptcy and Insolvency Act in Canada.
The Hon. Shelley C. Chapman is the U.S. case judge.
The Debtors tapped Kirkland & Ellis LLP as counsel; Lazard Freres &
Co. as investment banker; Alvarez & Marsal North America LLC as
interim management and financial advisory services provider;
Consensus Advisory Services LLC and Consensus Securities LLC as
investment banker in connection with the sale of intellectual
property associated with the Nine West and Bandolino brands;
Deloitte Tax LLP as tax services provider; and BDO USA, LLP, as
auditor and accountant.
Munger, Tolles & Olson LLP is serving as the company's independent
counsel, rendering services at the direction of independent
directors Alan Miller and Harvey Tepner. Berkeley Research Group
is serving as independent financial advisor, rendering professional
services at the direction of the Independent Directors.
Prime Clerk LLC is the claims and noticing agent.
The Ad Hoc Group of Secured Term Loan Lenders tapped Davis Polk &
Wardwell LLP as counsel; and Ducera Partners LLC as financial
advisor.
The Ad Hoc Crossover Group of Secured and Unsecured Term Loan
Lenders tapped King & Spalding LLP as counsel and Guggenheim
Securities, LLC, as financial advisor.
Brigade Capital Management, LP, a party to the RSA tapped Kramer
Levin Naftalis & Frankel LLP as counsel.
The Official Committee of Unsecured Creditors tapped Akin Gump
Strauss Hauer & Feld LLP as counsel; Houlihan Lokey Capital, Inc.,
as investment banker; and Protiviti Inc. as financial advisor and
forensic accountant.
Sycamore Partners Management, L.P., owner of 90.2% of the equity
interests in the debtors, tapped Proskauer Rose LLP as counsel.
Authentic Brands, which bought Nine West's IP assets, tapped DLA
Piper Global Law Firm as counsel.
* * *
The Debtors filed a Chapter 11 plan that's based on a restructuring
support agreement signed with certain members of the Secured Lender
Group, certain members of the Crossover Group, and Brigade, who
collectively hold over 78 percent of the company's secured term
loan and over 89 percent of the unsecured term loan.
In an auction on June 8, 2018, for the company's Nine West,
Bandolino and associated brands, brand developer and marketing
company Authentic Brands Group outbid shoe retailer DSW Inc. The
winning bid of Authentic Brands' ABG-Nine West LLC was $340 million
in cash and other consideration, which is $140 million more than
ABG's stalking horse bid.
The official committee of unsecured creditors has filed a motion
seeking to conduct an examination of and seek discovery from the
Debtors and third parties pursuant to F.R.B.P. Rule 2004. The
Committee says its initial investigation indicates there are a
number of potential estate claims arising from the 2014 LBO.
OCEAN SERVICES: Authorized to Use Cash Collateral, Obtain Financing
-------------------------------------------------------------------
The Hon. Timothy W. Dore of the U.S. Bankruptcy Court for the
Western District of Washington authorized Ocean Services, LLC, and
certain subsidiaries to use cash collateral and to enter into the
DIP Loan Documents to obtain postpetition financing from Daniel W.
Stabbert and Cheryl Stabbert (DIP Lender), and perform the DIP Loan
Obligations, in each case subject to any limitations set forth in
the Second Interim Order.
The Debtors are authorized to use cash collateral and proceeds of
the DIP Loan solely to pay the costs and expenses and for the
purposes identified in the Budget with respect to the Debtors'
business operations and those of affiliated Non-Debtor Guarantors'
businesses, in amounts not to exceed the aggregate amount
authorized under the Budget.
In addition to the DIP Loan, the Debtors are authorized to utilize
the DIP Lender's American Express ("AMEX") card maintained in the
DIP Lender's name as advances to pay various expenses incurred in
the ordinary course of business by the Debtors, including but not
limited to employee travel expenses and prepayment, when required,
of Vessel-related vendors. The Debtors are authorized to pay the
amount of such expenses directly to AMEX each month.
The material DIP Obligations include the following:
(A) Loan Amount/Deposit into Escrow: $1,350,000. These DIP
Funds have been deposited by the DIP Lender into an escrow
maintained by Wanda Reif Nuxoll, P.S. ("DIP Loan Escrow Agent")
and, other than to provide funds to the Debtors for their use in
this case, the DIP Funds will not be transferred out of the DIP
Loan Escrow without further order of the Court, after notice and
hearing.
(B) Maturity: Earlier of: (i) payment in full of the
Prepetition Credit Agreement Obligations under the terms of a
confirmed Chapter 11 Plan; (ii) sale of all or substantially all of
the Borrower’s assets; (iii) appointment of a Trustee in this
Bankruptcy Case; or (iv) conversion of this Bankruptcy Case to a
case under Chapter 7.
(C) Interest Rate: Prime Rate as published in the Wall Street
Journal plus a margin of 3.25%, accrued until Maturity.
(D) Collateral: Subordinate preferred ship mortgages against
the Debtors' Vessels, junior to the Liens of the Senior Secured
Lenders and to any valid, pre-existing liens against the Vessels as
of the Petition Date.
(E) The DIP Loan will be subordinate to the Prepetition Credit
Agreement Obligations and will be subject to the Intercreditor and
Subordination Agreement entered into by the DIP Lender and Columbia
Bank, on behalf of the Senior Secured Lenders.
(F) Revolving Line of Credit: The DIP Loan will be a revolving
line of credit with all payments on the DIP Loan made to the DIP
Loan Escrow and available for re-borrowing.
(G) Priority: Claim under Section 507(b) of the Bankruptcy
Code.
As of the Petition Date, debtor Stabbert Maritime Holdings, LLC,
was indebted to Columbia State Bank, Umpqua Bank, MUFG Union Bank,
N.A., and Washington Federal, National Association ("Senior Secured
Lenders") under a reducing revolving line of credit in the
approximate amount of $41,775,931. The terms of the Prepetition
Credit Agreement Facility are set forth in various loan documents,
including the Third Amended and Restated Credit Agreement, between
Debtor Stabbert Holdings as borrower and the Senior Secured Lenders
as lenders, and as to which Columbia Bank serves as Administrative
Agent and Collateral Agent for the Senior Secured Lenders.
The Prepetition Credit Agreement is guaranteed by all of the
Debtors, with the exception of Stabbert Holdings, which is the
Borrower and primary obligor, and is secured by (i) first position
preferred ship mortgages on all four of the Debtors' Vessels.
Pursuant to a Second Amended and Restated Commercial Security
Agreement, the Senior Secured Lenders have perfected security
interests in all or substantially all of the Debtors' personal
property.
The Debtors stipulate that as of the Petition Date, the Senior
Secured Lenders' preferred ship mortgages and security interests in
and with respect to the Prepetition Credit Agreement Collateral
constituted valid, binding, enforceable, attached, and perfected
liens on the Debtors' property, not subject to subordination or
avoidance.
As adequate protection for the Debtors' use of Cash Collateral:
(a) The Debtors will pay to the Senior Secured Lenders
interest at the non-default rate designated in the applicable
Prepetition Credit Agreement on the interest payment dates set
forth in the Prepetition Credit Agreement and related loan
documents.
(b) The reasonable fees and expenses of financial and legal
advisors engaged by the Senior Secured Lenders will be accrued as
an obligation of the Debtors, to the extent not paid as provided
for below, subject to this Court's determination of any dispute
with respect to the amount of such fees and expenses. Pursuant to
the Budget, the Debtors will set aside $10,000 per month for the
purpose of paying the Senior Secured Lenders' financial and legal
advisory fees and expenses, and will use these funds, up to the
amount of the cumulative reserve on hand, to pay those fees during
the case. Such reserve is not intended and will not limit the
Lenders' financial and legal advisory fees nor the Lenders' rights
to payment from the Debtors or Non-Debtor Guarantors for such fees
and expenses.
(c) The Debtors will provide the Senior Secured Lenders with
financial and other reporting in compliance with the Second Interim
Order and the requirement of the Bankruptcy Code and Rules.
(d) The Senior Secured Lenders are granted valid, binding,
enforceable and perfected replacement liens on and security
interests in all Postpetition Collateral of Debtors, other than
debtor Stabbert Holdings, to secure an amount equal to any decrease
in the value of the Senior Secured Lenders' interest in the
Prepetition Credit Agreement Collateral.
(e) The Prepetition Credit Agreement and Adequate Protection
Liens will have priority over all liens, claims, encumbrances, and
interests of every kind and nature, whether created before or after
the Petition Date, as well as the liens granted to the DIP Lender,
junior and subject only to (i) any valid, enforceable, perfected
and unavoidable lien on Debtors' assets and property in existence
as of the Petition Date or duly perfected after the Petition Date
in accordance with Section 546(b) of the Bankruptcy Code, provided
that the Prepetition Credit Agreement Adequate Protection Liens
will have priority over any lien subject to the Subordination
Agreement, and (ii) the Carve-Out.
(f) The Debtors will continue to maintain insurance on their
assets as the same existed as of the Petition Date.
(g) By noon on Tuesday of each week, starting on the Tuesday
after the first full week after the Petition Date, the Debtors will
provide Columbia Bank with a report showing the budget-to-actual
for the previous week ("Budget-to-Actual Report").
(h) The Debtors and Non-Debtor Guarantors will provide
Columbia Bank with (i) an accounting for all funds in the Mexican
Bank accounts closed by them since the Petition Date and (ii)
copies of all statements for the Mexican bank accounts maintained
by them -- this is without limitation to the other reports required
to be provided by them to Columbia Bank.
(i) The Senior Secured Lender's claim will have priority over
every other claim and administrative expense allowable under
Section 507(a)(2) of the Bankruptcy Code, but subordinate to the
Carve-Out, in any amount equal to the decrease in the value of that
party's interest in the Prepetition Credit Agreement Collateral as
a result of the Debtors' use of Cash Collateral.
About Ocean Services
Based in Seattle, Washington, Ocean Services and its subsidiaries
-- https://www.stabbertmaritime.com/ -- are a marine operations
group with over three decades of experience working with offshore
petrochemical companies, the US Government, fisheries, and
submarine telecommunications cable survey and installations
operators in the waters off the US East Coast, South America, Gulf
of Mexico and the Caribbean, the Aleutians, Arctic and Antarctic,
the Bering Sea and across the Pacific Ocean. The Stabbert Maritime
group of companies offers a comprehensive package of services to
the subsea construction and offshore science sector as well as
shipyard and mobile vessel repair. Ocean Services provides support
vessels to science and survey sectors for clients including NOAA,
US Navy, Johns Hopkins University, FUGRO, CP+ and Shell, providing
fisheries research, geotechnical/physical, oceanographic, survey
and testing services. Stabbert Maritime, through subsidiary Ocean
Sub Sea Services (OS/3), provides dive and construction support
vessels to oil and gas clients in Gulf of Mexico, Mexico, Brazil,
California, and the Arctic.
Seven of the Stabbert Maritime Group companies, led by Ocean
Services, LLC, filed Chapter 11 cases (Bankr. W.D. Wash. Lead Case
No. 18-13512) on Sept. 7, 2018, and those cases have been
administratively consolidated. The cases are assigned to Hon.
Timothy W. Dore. The petitions were signed by Lindsay A.
Sckorohod, manager Thetis, LLC, manager Stabbert Mar. Hdgs. LLC,
sole member.
Bush Kornfeld LLP, serves as the Debtors' counsel.
Ocean Services disclosed in assets $2,037,223 and $45,753,398 in
liabilities as of the bankruptcy filing. Affiliate Ocean Carrier
Holding S. de R.L. disclosed $16,492,038 in assets and $41,790,361
in liabilities.
No official committee of unsecured creditors has been appointed in
the Chapter 11 cases.
ODYSSEY LOGISTICS: S&P Affirms 'B' ICR, Outlook Remains Stable
--------------------------------------------------------------
S&P Global Ratings affirmed its 'B' issuer credit rating on
third-party logistics provider Odyssey Logistics and Technology
Corp. The outlook remains stable.
S&P said, "At the same time, we affirmed our 'B+' issue-level
rating on the company's proposed upsized revolving credit facility
and first-lien term loan. The '2' recovery rating remains
unchanged, indicating our expectation for substantial (70%-90%;
rounded estimate: 70%) recovery for lenders in the event of a
payment default.
"Additionally, we affirmed our 'CCC+' issue-level rating on the
company's proposed upsized second-lien term loan. The '6' recovery
rating indicates our expectation for negligible recovery (0%-10%;
rounded estimate: 0%) in the event of a payment default."
Odyssey is a niche provider of third-party logistics, primarily in
the U.S. The company has announced that it will acquire AFF Global
Logistics, which provides freight forwarding services (arranging
freight transportation for shippers) mainly on domestic routes
between the continental U.S. and Hawaii, Alaska, Puerto Rico, and
Guam as well as similar services on routes between Asia and the
U.S. Relative to Odyssey, AFF has a smaller revenue base and is a
smaller participant in the large and fragmented third-party
logistics industry. Therefore, S&P doesn't expect the transaction
to change its assessment of Odyssey's competitive position.
S&P said, "The stable outlook on Odyssey Logistics reflects our
expectation that the company's credit metrics will remain mostly
stable following its acquisition of AFF Global, which we expect to
close around the end of 2018. Based on the timing of the
transaction, we expect the company's debt to EBITDA to improve to
the mid-5x area in 2019 from the mid-9x area in 2018 while its FFO
to debt rises to around 10% in 2019 from the mid-single digit
percent area in 2018.
"We could lower our ratings on Odyssey over the next 12 months if
the company pursues additional debt-financed acquisitions such that
its debt to EBITDA increases above 7.0x or its FFO-to-debt ratio
falls below 6% on a sustained basis. This could also occur if the
company's earnings materially weaken due to a downturn in the
demand for metals or chemicals.
"Although unlikely, we could raise our ratings on Odyssey over the
next 12 months if the company posts better-than-expected operating
results and pursues a less aggressive financial policy that reduces
its debt to EBITDA below 5.0x and increases its FFO to debt above
12%. We would also need to believe that the company's credit
metrics will remain at these levels going forward in order to raise
our rating. Odyssey could improve its metrics if it reduced its
purchased transportation costs or realized a greater-than-expected
level of synergies from the acquisition of AFF Global."
PACIFIC DRILLING: Wants to Keep Exclusivity to Finalize Zonda Plan
------------------------------------------------------------------
Pacific Drilling VIII Limited and Pacific Drilling Services, Inc.
(the "Zonda Debtors"), ask the U.S. Bankruptcy Court for the
Southern District of New York to extend for 50 days the exclusive
periods in which the Zonda Debtors may file a chapter 11 plan of
reorganization and solicit acceptances thereof, through and
including Dec. 17, 2018 and Feb. 15, 2019, respectively.
The Zonda Debtors further ask the Court to enter a bridge order
extending the exclusive periods in which the Zonda Debtors may file
and solicit acceptances of a chapter 11 plan of reorganization
through the later of (a) the hearing for the Court's consideration
of Debtors' Exclusivity Motion scheduled for Nov. 15, 2018, or (b)
the date on which the Bankruptcy Court resolves the Exclusivity
Motion.
A hearing to consider extension of the Debtors' Exclusivity Periods
will be held on November 15, 2018, at 10:00 a.m. Any responses or
objections are due on or before November 8.
After years of hard-fought negotiation and mediation between the
Debtors, their major creditor constituencies and the majority
equity holder of Pacific Drilling S.A. ("PDSA"), the Debtors have
made substantial progress in moving forward with these cases, as
evidenced by the upcoming unopposed confirmation hearing to
consider approval of the Debtors' Modified Third Amended Joint Plan
of Reorganization for Pacific Drilling S.A. and Certain of its
Affiliates.
However, the Zonda Debtors were carved out of the Plan due to the
continuing existence of a critical unresolved contingency with
respect to the Zonda Debtors' estates. Pacific Drilling VIII and
Pacific Drilling Services are the contract party and guarantor,
respectively, under the Pacific Zonda contract with Samsung Heavy
Industries, which is subject to an arbitration proceeding currently
pending in London (the Zonda Arbitration"). Although the Debtors
expect that the Zonda Debtors will prevail in the Zonda
Arbitration, they do not expect the Arbitration Panel to issue a
decision prior to confirmation of the Plan.
Due to the unresolved nature of Samsung's contingent, unliquidated
claims and in anticipation of resolution of those claims by the
Arbitration Panel after the Effective Date of the Plan, the Zonda
Debtors were not included as Debtors under the Plan. Instead, the
Debtors have determined that the Zonda Debtors will be the subject
of a separate joint plan -- the Zonda Plan.
The Zonda Debtors and Samsung have been discussing potential
concept for the Zonda Plan and will endeavor to work cooperatively
and in good faith during the requested extension of the Exclusive
Periods in order to finalize the Zonda Plan with an eye towards
being able to present a consensual plan for confirmation.
The Zonda Plan is expected to include a toggle feature based on the
outcome of the Zonda Arbitration. If the Zonda Debtors prevail in
the Zonda Arbitration, all allowed claims against the Zonda Debtors
will be paid in full, any excess cash will be provided to the
Reorganized Debtors as the holders of interests in the Zonda
Debtors, and the Reorganized Zonda Debtors will become guarantors
on the New First Lien Notes and New Second Lien PIK Toggle Notes
with the Non-Zonda Debtors pursuant to and in accordance with the
terms of the New Secured Debt Documents. If the Zonda Debtors do
not prevail in the Zonda Arbitration, a liquidation trust will be
formed to liquidate the liquidation trust assets and to enable the
liquidation trustee to distribute the proceeds to holders of
liquidation trust interests in accordance with the Zonda Plan and
the liquidation trust agreement.
The Zonda Plan concept is a product of the Debtors' cooperation
with Samsung, the only major creditor of the Zonda Debtors. The
Debtors believe that no creditor will be prejudiced by the relief
requested herein. The Debtors are committed to continue working in
good faith with the creditors of the Zonda Debtors to file, confirm
and consummate the Zonda Plan and each of the transactions
contemplated therein.
Because the Arbitration Panel's decision is not expected until
after the current Exclusive Periods expire, a further extension of
the Exclusive Periods is reasonable. Moreover, the Zonda Debtors
and Samsung continue to negotiate the specific terms of the Zonda
Plan and require additional time to conclude such efforts.
With a Plan confirmation hearing scheduled to occur in two days,
and the Debtors and Samsung working cooperatively to finalize the
terms of a consensual Zonda Plan that addresses the potential
outcomes of the Zonda Arbitration, there can be no question that
the Debtors are proceeding in good faith to reach an expeditious
resolution of these cases upon a decision by the Arbitration
Tribunal. Accordingly, the Debtors submit that the requested
extension is appropriate and warranted.
About Pacific Drilling
Pacific Drilling S.A. (OTC: PACDQ) a Luxembourg public limited
liability company (societe anonyme), operates an international
offshore drilling business that specializes in ultra-deepwater and
complex well construction services. Pacific Drilling --
http://www.pacificdrilling.com/-- owns seven high-specification
floating rigs: the Pacific Bora, the Pacific Mistral, the Pacific
Scirocco, the Pacific Santa Ana, the Pacific Khamsin, the Pacific
Sharav and the Pacific Meltem. All drillships are of the latest
generations, delivered between 2010 and 2014, with a combined
historical acquisition cost exceeding $5.0 billion. The average
useful life of a drillship exceeds 25 years.
On Nov. 12, 2017, Pacific Drilling S.A. and 21 affiliates each
filed a voluntary petition for relief under Chapter 11 of the
United States Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No.
17-13193). The cases are pending before the Honorable Michael E.
Wiles and are jointly administered.
Pacific Drilling disclosed $5.46 billion in assets and $3.18
billion in liabilities as of Sept. 30, 2017.
The Debtors tapped Sullivan & Cromwell LLP as bankruptcy counsel
but was later replaced by Togut, Segal & Segal LLP; Evercore
Partners International LLP as investment banker; AlixPartners, LLP,
as restructuring advisor; Alvarez & Marsal Taxand, LLC as executive
compensation and benefits consultant; Ince & Co LLP and Jones
Walker LLP as special counsel; and Prime Clerk LLC as claims and
noticing agent; Deloitte Financial Advisory Services LLP, as
accounting advisor to the Debtor.
The RCF Agent tapped Shearman & Sterling LLP, as counsel, and PJT
Partners LP, as financial advisor.
The ad hoc group of RCF Lenders engaged White & Case LLP, as
counsel.
The SSCF Agent tapped Milbank Tweed, Hadley & McCloy LLP, as
counsel, and Moelis & Company LLC, as financial advisor.
The Ad Hoc Group of Various Holders of the Ship Group C Debt, 2020
Notes and Term Loan B tapped Paul, Weiss, Rifkind, Wharton &
Garrison, in New York as counsel.
PALADIN HOSPITALITY: Seeks Authorization to Use Cash Collateral
---------------------------------------------------------------
Paladin Hospitality, LLC, seeks authority from the U.S. Bankruptcy
Court for the Northern District of Georgia to use cash collateral
to meet its ordinary operating expenses and maintain its Business.
The Debtor owns and operates The Pinewood restaurant located at 254
W Ponce de Leon Avenue, Decatur, GA 30030. The Debtor claims that
it has no other source of income other than the cash collateral
generate from its operation of The Pinewood. The Debtor has
prepared a budget of projected income and expenses for the next six
months. The budget provides total operating expenses of
approximately $194,248 and other expenses of $28,500 during the
months of October 2018 through March 2019.
The Debtor believes that these Creditors may assert an interest in
the accounts of its Business:
(a) 1st BFS Capital asserts a security interest for its claim
of approximately $39,455;
(b) Bizfund, LLC asserts a security interest for its claim of
approximately $133,644;
(c) Cofactor, LLC asserts a security interest for its claim of
an unknown amount;
(d) Credibility Capital asserts a security interest for its
claim of approximately $133,846;
(e) Global Financial and Leasing asserts a security interest
for its claim of an unknown amount;
(f) GTR Source asserts a security interest for its claim of
approximately $277,800;
(d) On Deck Capital asserts a security interest for its claim
of approximately $118,870; and
(e) PBS Capital asserts a security interest for its claim of
an unknown amount.
To the extent that Debtor uses the cash collateral, the Debtor
proposes to grant all Creditors replacement liens in revenue
generated post-petition of the same kind, extent, and priority as
those existing prepetition.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/ganb18-67292-7.pdf
About Paladin Hospitality
Paladin Hospitality, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Case No. 18-67292) on Oct. 12,
2018. In the petition signed by Earl E. Cloud, III, owner, the
Debtor estimated assets of less than $50,000 and debts of less than
$1 million. The Debtor tapped William Anderson Rountree, Esq., at
Rountree & Leitman, LLC, as counsel.
PARSLEY ENERGY: Moody's Raises CFR to Ba3, Outlook Stable
---------------------------------------------------------
Moody's Investors Service upgraded Parsley Energy LLC's Corporate
Family Rating to Ba3 from B1, Probability of Default Rating to
Ba3-PD from B1-PD and senior unsecured notes to B1 from B2, and
affirmed its SGL-3 Speculative Grade Liquidity rating. The outlook
remains stable.
"Parsley's continued execution on its growth plan amidst a
supportive commodity price environment will keep the company's
credit metrics strong," said Arvinder Saluja, Moody's Vice
President. "While we expect Parsley to fund negative free cash flow
with revolver debt in 2019, its existing production scale and
capital productivity metrics support the upgrade."
Issuer: Parsley Energy LLC
Upgrades:
Probability of Default Rating, Upgraded to Ba3-PD from B1-PD
Corporate Family Rating, Upgraded to Ba3 from B1
Senior Unsecured Notes, Upgraded to B1 (LGD4) from B2 (LGD4)
Affirmations:
Speculative Grade Liquidity Rating, affirmed at SGL-3
Outlook Actions:
Outlook, Remains Stable
RATINGS RATIONALE
Parsley's Ba3 CFR reflects the company's strong execution on its
growth capital spending, material sustained production growth in a
volatile commodity price environment, and progressively improved
credit metrics (which have been helped by equity issuances). The
company operates good acreage in the Permian Basin which produces
liquids-rich volumes that generate healthy cash margins, provide
for multiple year drilling inventory, and offer a high degree of
operational control over its leasehold acreage, which allows for
flexible capital allocation and development in light of crude price
volatility. Additionally, Parsley has firm transportation contracts
in place that should support its realized prices and cash flows as
production in the Permian continues to overwhelm takeaway capacity
in the basin. The CFR is limited by its concentrated geographic
presence and by its expectation of negative free cash flow in 2019.
Parsley's SGL-3 rating reflects adequate liquidity. In April 2018,
the company entered into the Sixth Amendment to the revolving
credit facility due October 2021 that increased the borrowing base
to $2.3 billion from $1.8 billion; however, committed capacity
remains at $1 billion. As of June 30, 2018 the company had $8.8
million in letters of credit and no outstanding borrowings under
its revolving credit facility, and $202 million in cash. In 2018,
Parsley has a capital expenditure budget of $1.65-1.75 billion.
Moody's expects that the company's cash flow from operations and
cash balance will not be sufficient to cover capital expenditures,
resulting in negative free cash flow through 2019. Depending on
commodity prices, revolver borrowings could utilize between 30%-50%
of committed capacity. The revolving credit facility has two
financial covenants: a current ratio of at least 1.0x and a
consolidated leverage ratio of 4.0x. Moody's expects the company to
be in compliance with these covenants, and have ample cushion.
In accordance with Moody's Loss Given Default methodology, the
senior unsecured notes are rated B1, one notch below Parsley's Ba3
CFR due to the subordination of the notes to the $1 billion senior
secured revolving credit facility.
The stable outlook reflects its expectation that Parsley will
continue to execute on its growth plans in 2019 while maintaining a
good cost structure and favorable credit metrics. If Parsley
approaches free cash flow neutrality and grows its production scale
while maintaining RCF/debt ratio above 50% and leveraged full-cycle
ratio above 1.5x, an upgrade could be considered. Moody's could
consider a negative outlook or a downgrade if the RCF/debt ratio
falls below 30% or if capital productivity declines and leveraged
full-cycle ratio falls below 1x.
Parsley Energy, LLC is an oil and gas exploration and production
company with all of its properties located in the Midland and
Delaware Basins in west Texas.
The principal methodology used in these ratings was Independent
Exploration and Production Industry published in May 2017.
PETSMART INC: Bank Debt Trades at 15% Off
-----------------------------------------
Participations in a syndicated loan under which Petsmart
Incorporated is a borrower traded in the secondary market at 85.33
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.92 percentage points from the
previous week. Petsmart Incorporated pays 300 basis points above
LIBOR to borrow under the $42 million facility. The bank loan
matures on March 10, 2022. Moody's rates the loan 'B3' and Standard
& Poor's gave a 'CCC' rating to the loan. 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
Friday, October 26.
PIEDMONT SALES: Eighth Interim Cash Collateral Order Entered
------------------------------------------------------------
The Hon. Laura T. Beyer of the U.S. Bankruptcy Court for the
Western District of North Carolina has entered an eighth interim
order authorizing Piedmont Sales Service & Transport, LLC, to use
cash collateral in the ordinary course of business through November
7, 2018.
A status hearing on the Use of Cash Collateral is continued to
November 7, 2018 at 11:00 a.m.
Piedmont has filed and served a proposed Disclosure Statement and
Reorganization Plan on October 10, 2018 that will allow it to
continue to operate the business and pay the creditors over a
period of years. Piedmont's plan will include liquidating and
selling some property to reduce the debt of the business.
Piedmont's authority to use cash collateral is limited to pay
operating expenses, management fees, independent contractors and
other necessary expenses for its operations.
Interstate Capital Corporation is a factoring company which obtains
its payments by collecting a percentage of the payments it factors
from the Debtor's customers. Prior to the bankruptcy filing, two of
the DIP's customers defaulted on their payments to Interstate
Capital in the amount of $113,000. Interstate Capital contends
these two accounts are not collectible and Interstate Capital is
not receiving adequate protection. The interest rate on the debt is
18% which is accruing $1,695 in interest monthly. The Debtor
proposes to pay to Interstate Capital $1,695 per month until Plan
Confirmation.
National Funding also has a lien on all the Debtor's assets
consisting of office equipment, bank accounts and Accounts
Receivable. National Funding holds a debt of $80,000. The Debtor
proposed that National Funding receive direct payments from the
Debtor in the amount of $1,000 as adequate protection but
Interstate Capital does not consent to pay National Funding
adequate protection payments out of cash collateral.
Interstate Capital contends that the Debtor does not have
sufficient equity in property to provide National Funding secured
status. Therefore, Interstate Capital has agreed for the Debtor to
disburse the proposed $1,000 and for the funds to be held in the
McElwee Firm, PLLC Trust Account, pending resolution of this
matter.
As adequate protection, Interstate Capital will retain its liens on
all prepetition collateral and is granted a replacement lien upon
all collateral of the type and kind upon which it had pre-petition
liens, to the same extent, priority, and validity as it had on the
Petition Date and will be deemed perfected without further action
by Interstate Capital.
A full-text copy of the Eighth Interim Order is available at
http://bankrupt.com/misc/ncwb18-50160-71.pdf
About Piedmont Sales Service & Transport
Piedmont Sales Service & Transport, LLC, sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D.N.C. Case No.
18-50160) on March 8, 2018. In the petition signed by Brian
Souther, managing member, the Debtor estimated assets and
liabilities of less than $1 million. Judge Laura T. Beyer presides
over the case. The Debtor hired McElwee Firm, PLLC, as bankruptcy
counsel. The Debtor tapped Tom Torcomian, Harvey Holdings Inc.'s
consultant and chief operating officer, to manage its business.
POINTCLEAR SOLUTIONS: Case Summary & 20 Top Unsecured Creditors
---------------------------------------------------------------
Debtor: PointClear Solutions, Inc.
908 Merchants Walk
Huntsville, AL 35801
Business Description: Founded in 2006, PointClear Solutions, Inc.
-- https://www.pointclearsolutions.com -- is
a digital health consultancy specializing in
designing, developing, implementing, and
managing custom solutions with an emphasis
on innovation. The Company offers a wide-
range of strategic, digitalization, and
production services tailored to the unique
needs across the continuum of healthcare.
PointClear is based in Nashville, Tennessee.
Chapter 11 Petition Date: November 2, 2018
Court: United Sates Bankruptcy Court
Northern District of Alabama (Decatur)
Case No.: 18-83286
Judge: Hon. Clifton R. Jessup Jr.
Debtor's Counsel: Stuart M. Maples, Esq.
MAPLES LAW FIRM, PC
200 Clinton Avenue W., Suite 1000
Huntsville, AL 35801
Tel: 256 489-9779
Fax: 256-489-9720
E-mail: smaples@mapleslawfirmpc.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by David Karabinos, president and CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at:
http://bankrupt.com/misc/alnb18-83286_creditors.pdf
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/alnb18-83286.pdf
POLICLINICA FAMILIAR: Plan Outline Okayed, Plan Hearing on Dec. 11
------------------------------------------------------------------
Policlinica Familiar Shalom Inc. is now a step closer to emerging
from Chapter 11 protection after a bankruptcy judge approved the
outline of its plan of reorganization.
Judge Mildred Caban Flores of the U.S. Bankruptcy Court for the
District of Puerto Rico on Oct. 25 gave the thumbs-up to the
disclosure statement after finding that it contains "adequate
information."
Creditors are required to file their objections and submit ballots
of acceptance or rejection of the plan on or before 14 days prior
to the hearing.
A court hearing to consider confirmation of the plan is scheduled
for Dec. 11, at 9:00 a.m. The hearing will take place at the Jose
V. Toledo Federal Building and US Courthouse, Courtroom 3.
About Policlinica Familiar Shalom Inc.
Policlinica Familiar Shalom Inc. filed a Chapter 11 petition
(Bankr. D.P.R. Case No. 17-02544) on April 12, 2017. The Debtor is
engaged in the health care business as defined in 11 U.S.C. Section
101(27A) whose principal assets are located at Carr 2 Km 101.6
Barrio Terranova Quebradillas, PR 00678. The Company said it is
suffering economic hardship and is in the process of losing its
business premises in foreclosure proceedings.
The Debtor's counsel is Jose Ramon Cintron, Esq., in San Juan,
Puerto Rico.
At the time of filing, the Debtor had estimated assets of $0 to
$50,000 and estimated liabilities of $1 million to $10 million.
QUAD/GRAPHICS INC: Moody's Alters Outlook on Ba3 CFR to Negative
----------------------------------------------------------------
Moody's Investors Service changed Quad/Graphics, Inc.'s ratings
outlook to negative from stable following the company's 31 October,
2018 announcement that it has agreed to acquire LSC Communications,
Inc. in an all-stock transaction valued at approximately $1.4
billion, including the refinancing of LSC's debt. As part of the
same action, Moody's affirmed Quad's Ba3 corporate family rating,
Ba3-PD probability of default rating, Ba2 senior secured credit
facility rating and B2 senior unsecured rating. The company's SGL-1
speculative grade liquidity rating remains unchanged (indicates
very good liquidity).
"We think that the LSC acquisition is strategically appropriate,
but changed Quad's ratings outlook to negative because of execution
risks related to the company's ability to internalize sufficient
scale and operational flexibility benefits to offset credit quality
dilution stemming from LSC's relatively higher cost, more highly
levered business," said Bill Wolfe, a Moody's senior vice
president. In addition to integration risks typical of any
large-scale acquisition, Wolfe suggested that the transaction
timetable provides a protracted period in which other events could
intervene and disrupt Quad's plans. With integration efforts
occurring over eight quarters subsequent to a closing that could be
three quarters away, such events could stem from macroeconomic
developments, sector-specific supply-demand developments, or
smaller-scale debt-financed acquisitions.
The following summarizes Quad's ratings and its actions:
Rating affirmations:
Corporate Family Rating, Affirmed at Ba3
Probability of Default Rating, Affirmed at Ba3-PD
Senior Secured Bank Credit Facility, Affirmed at Ba2 (LGD3)
Senior Unsecured Notes/Debentures, Affirmed at B2 (LGD5)
Rating Unchanged:
Speculative Grade Liquidity Rating, SGL-1
Outlook Action:
Outlook, Changed To Negative From Stable
RATINGS RATIONALE
Quad/Graphics, Inc.'s Ba3 corporate family rating benefits from
management's financial conservatism and the company's low cost
position, the combination of which provides confidence that Quad's
ample FCF will be used to reduce debt, thereby maintaining leverage
of debt/EBITDA at 2.5x-3.0x (3.0x at June 30, 2018) even as cash
flow declines. Quad also benefits from very good liquidity. Ratings
challenges stem from Quad's exposure to the commercial printing
industry's secular decline and ongoing pressure on revenues and
margins, a background prompting Quad to be acquisitive, which
introduces execution risks and potential leverage volatility.
Execution risks re the pending acquisition of LSC are also credit
negative, with it being unclear whether scale and operational
flexibility benefits offset credit quality dilution stemming from
LSC's relatively higher cost, more highly levered business. Pro
forma leverage deteriorates by about 0.4x while margins decline by
nearly 100 basis points (excluding transaction expenses, synergies
and their implementation costs).
Rating Outlook
The negative outlook reflects execution risks related to the
company's ability to internalize sufficient scale and operational
flexibility benefits to offset credit quality dilution stemming
from the pending LSC acquisition.
What Could Change the Rating -- Up
Leverage of debt/EBITDA sustained below ~2.5x (3.0x at June 30,
18); along with
Maintenance of solid liquidity arrangements; solid operating
fundamentals with positive organic growth and no worse than stable
margins.
What Could Change the Rating -- Down
Leverage of debt/EBITDA sustained near or above 3.25x (3.0x at June
30, 18); or if
Industry fundamentals deteriorated further, evidenced by, for
example, either margin compression or accelerating revenue
declines, or if
Quad completed a significant debt-financed acquisition or
experienced significant adverse liquidity developments.
The principal methodology used in these ratings was Media Industry
published in June 2017.
Headquartered in Sussex, Wisconsin, Quad/Graphics, Inc. (Quad) is a
publicly-traded leading North American commercial printing company.
Annual revenues are ~$4.2 billion with 90% from US operations, 5%
from South America and 4% from Europe.
Headquartered in Chicago, Illinois, LSC Communications, Inc. (LSC),
is a retail/advertising-centric print/publishing services and
office products company with annual sales of about $3.9 billion.
REAGOR AUTO MALL: Voluntary Chapter 11 Case Summary
---------------------------------------------------
Five affiliates that have filed voluntary petitions seeking relief
under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Reagor Auto Mall, Ltd. 18-33577
1211 19th St.
Lubbock, TX 79401
Reagor-Dykes Snyder, L.P. 18-33578
4004 Spur Business 84
Snyder, TX 79549
Reagor-Dykes Auto Mall I LLC 18-33579
Reagor-Dykes II LLC 18-33580
Reagor-Dykes III LLC 18-33581
Business Description: The Debtors are Texas limited partnerships
which own and operate auto dealership in
and around West Texas. The Debtors make up
part of what is known as the Reagor-Dykes
Auto Group.
Chapter 11 Petition Date: November 2, 2018
Court: United States Bankruptcy Court
Northern District of Texas (Dallas)
Judge: Hon. Stacey G. Jernigan
Debtors' Counsel: Marcus Alan Helt, Esq.
FOLEY & LARDNER LLP
2021 McKinney Avenue, Suite 1600
Dallas, TX 75201
Tel: 214-999-4526
214-999-3000
Fax: 214-999-3526
E-mail: mhelt@foley.com
Reagor Auto's
Estimated Assets: $10 million to $50 million
Reagor Auto's
Estimated Liabilities: $10 million to $50 million
Reagor-Dykes Snyder's
Estimated Assets: $10 million to $50 million
Reagor-Dykes Snyder's
Estimated Liabilities: $10 million to $50 million
The Debtors failed to submit lists of their 20 largest unsecured
creditors at the time of the filing.
Full-text copies of two of the petitions are available for free
at:
http://bankrupt.com/misc/txnb18-33577.pdf
http://bankrupt.com/misc/txnb18-33578.pdf
RELATIVITY MEDIA: Files Chapter 11 Joint Liquidating Plan
---------------------------------------------------------
Relativity Media, LLC and its affiliates, together with the
creditors' committee filed a disclosure statement in support of
their chapter 11 joint liquidating plan dated Oct. 26, 2018.
The Plan establishes the Liquidating Trust, which will, among other
things, undertake the liquidation of the Debtors and their Estates,
administer Distributions in accordance with the Plan and the
Liquidating Trust Agreement and prosecute or otherwise resolve the
Retained Causes of Action. The Plan contemplates a liquidation of
the Debtors and their Estates. The Plan's primary objective is to
maximize the value of recoveries to all Holders of Allowed Claims
and distribute all property of the Estates that is or becomes
available for Distribution in accordance with the priorities
established by the Bankruptcy Code. The Plan Proponents believe
that implementation of the Plan is in the best interests of each of
the Debtors and their creditors.
On the Effective Date, each Holder of an Allowed General Unsecured
Claim will receive its Pro Rata portion of the beneficial interests
in the Liquidating Trust. Estimate recovery for unsecured creditors
is .04-2%,
The Plan contemplates that all Retained Assets of the Debtors will
be liquidated, sold, transferred, abandoned or otherwise disposed
of, and all proceeds of the Retained Assets will be distributed to
the Holders in accordance with the Plan and the Liquidating Trust
Agreement. Since no further financial reorganization of the Debtors
will be possible or is contemplated, the Plan Proponents believe
that the Plan meets the feasibility requirement.
A copy of the Disclosure Statement is available for free at:
http://bankrupt.com/misc/nysb18-11358-571.pdf
About Relativity Media
Relativity -- http://www.relativitymedia.com/-- is a global media
company engaged in multiple aspects of content production and
distribution, including movies, television, sports, digital and
music.
Relativity Studios, the company's largest division, has produced,
distributed or structured financing for more than 200 motion
pictures, generating more than $17 billion in worldwide box-office
revenue and earning 60 Oscar nominations. Relativity's films
include Oculus, Safe Haven, Act of Valor, Immortals, Limitless,
and
The Fighter.
Relativity Media LLC and its affiliates, including Relativity
Fashion, LLC, sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 15-11989) on July 30, 2015. The
case is assigned to Judge Michael E. Wiles.
An investor group composed of Anchorage Capital Group, L.L.C.,
Falcon Investment Advisors, LLC and Luxor Capital Group, LP on
Oct.
21, 2015, completed its purchase of the assets of Relativity
Television.
After selling their TV business, the Debtors and CEO Ryan C.
Kavanaugh filed a plan of reorganization that contemplated
reorganizing the Debtors' non-TV business units with a
substantially de-levered balance sheet utilizing new equity
investments and new financing. The Court on Feb. 8, 2016,
confirmed the Debtors' Fourth Amended Plan.
Relativity Media and its affiliates sought protection under
Chapter
11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 18-11358)
on May 3, 2018. This is the company's second trip to Chapter 11.
In the 2018 petition signed by CRO Colin M. Adams, Relativity
Media
estimated assets of $100 million to $500 million and liabilities
of
$500 million to $1 billion.
Judge Michael E. Wiles presides over the cases.
In the 2015 cases, the Debtors tapped Sheppard Mullin Richter &
Hampton LLP, and Jones Day as counsel; FTI Consulting, Inc., as
crisis and turnaround management services provider; Blackstone
Advisory Partners L.P. as investment; and Donlin, Recano &
Company,
Inc., as claims and noticing agent.
In the 2018 cases, the Debtors tapped Winston & Strawn LLP as
their
legal counsel; M-III Partners, LP as restructuring advisor; and
Prime Clerk LLC as noticing and claims consultant.
On May 18, 2018, the Office of the United States Trustee appointed
an official committee of unsecured creditors. The Committee
selected Robins Kaplan LLP to serve as counsel.
* * *
In the 2018 cases, Netflix, Inc., has a pending request before the
Court for the appointment of a trustee to manage the operations of
the Debtors.
REPUBLIC METALS: Case Summary & 30 Largest Unsecured Creditors
--------------------------------------------------------------
Three affiliates that have filed voluntary petitions seeking relief
under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Republic Metals Refining Corporation (Lead Case) 18-13359
15 West 47th Street
Suites 206 and 209
New York, NY 10036
Republic Metals Corporation 18-13360
Republic Carbon Company, LLC 18-13361
Business Description: Founded in 1980, the Debtors are refiner of
precious metals with a primary focus on gold
and silver. The Debtors have the capacity
to produce approximately 80 million ounces
of silver and 350 tons of gold, along with
over 55 million pieces of minted products,
per annum. Suppliers ship unrefined gold
and silver to the Debtors for refining from
all over the United States and the Western
Hemisphere. The Debtors provide their
products and services to a diverse base of
global mining corporations, financial
institutions and jewelry manufacturers.
The Debtors also have a state of the art
carbon sampling/processing facility.
Chapter 11 Petition Date: November 2, 2018
Court: United States Bankruptcy Court
Southern District of New York (Manhattan)
Judge:
Debtors' Counsel: Susan F. Balaschak, Esq.
AKERMAN LLP
666 Fifth Avenue, 20th Floor
New York, NY 10103
Tel: (212) 880-3800
Fax: (212) 880-8965
E-mail: susan.balaschak@akerman.com
- and -
John E. Mitchell, Esq.
AKERMAN LLP
2001 Ross Avenue, Ste. 3600
Dallas, TX 75201
Tel: (214) 720-4300
Fax: (214) 981-9339
E-mail: john.mitchell@akerman.com
- and -
Andrea S. Hartley, Esq.
Katherine C. Fackler, Esq.
AKERMAN LLP
98 Southeast Seventh Street, Ste. 1100
Miami, FL 33131
Tel: (305) 374-5600
Fax: (305) 374-5095
E-mail: andrea.hartley@akerman.com
katherine.fackler@akerman.com
Debtors'
Financial
Advisor: PALADIN MANAGEMENT GROUP, LLC
Debtors'
Claims &
Noticing
Agent: DONLIN RECANO & COMPANY, INC.
https://www.donlinrecano.com/Clients/rmetals/Dockets
Republic Metals Refining's
Estimated Assets: $1 million to $10 million
Republic Metals Refining's
Estimated Liabilities: $100 million to $500 million
The petitions were signed by Scott Avila, chief restructuring
officer.
A full-text copy of Republic Metal Refining's petition is available
for free at:
http://bankrupt.com/misc/nysb18-13359.pdf
List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
Laurelton Sourcing LLC Trade Debt $17,151,165
15 Sylvan Way
Parsipanny NJ 07834
Mary Messier
Tel: 401-288-0160
Email: Jonathan.Henry@Tiffany.com
Coeur Mexicana SA de CV Trade Debt $9,666,381
Ave. Valle Escondido #5500-401/
Fracc. Desarrollo el Saucito
Chihuahua 31125
Mexico
Tel: (312) 489-5800
Email: edchavez@coeur.com.mx
Sumitomo Trade Debt $8,790,000
300 Madison Avenue
New York NY 10017
Daniel Izzo
Tel: (212) 207-0535
Email: back@scgcuk.com
Erie Management Partners Trade Debt $6,038,258
348 Harris Hill Rd
Williamsville NY 14221
Mitchell T. Levine
Tel: (716) 866-6760
Email: mitchlevine@adelphia.net;
kmilitello@rochester.rr.com
Estelar Resources Limited S.A. Trade Debt $6,020,013
Royal Bank Plaza North Tower
200 Bay Street ON M5J 2J3
Canada
Paul Buchanan
Tel: (416) 815-0220
Email: paul.buchanan@yamana.com
Premier Gold Mines Limited Trade Debt $5,456,155
1100 Russell Street, Suite 200
Thunder Bay ON P7B 5N2
Canada
Steve Filipovic
Tel: (807) 346-1390
Email: ap@premiergoldmines.com
Primero Empresa Minera Trade Debt $5,018,451
S.A. De C.V.
Aquiles Serdan 1157 Col. Centro
Durango CP 34000
Mexico
Patsy Montenegro
Tel: (618) 827-9070 x 1129
Email: pmontenegro@firstmajestic.com
S&S Metal Group Trade Debt $4,659,538
Av. Pedro Henriquez Urena,
No. 138
Torre Empresarial Reyna II, Suite 304
La Esperilla
Dominican Republic
Jhean Sanchez
Tel: +1 809-534-5991
Email: info@ssmetalgroup.com
Minera Santa Cruz S.A. Trade Debt $4,573,113
Avenida Santa Fe 2755 Piso 9
Buenos Aires C14Z5BGC
Argentina
Sergio Renard
Tel: +54 11-4132-7900
Email: daniella.laguna@hocplc.com;
commercial.hoc+nonreply@hocplc.com
Pretium Exploration Inc. Trade Debt $4,079,000
2300, 1055 Dunsmuir Street
Vancouver BC V7X 1L4
Canada
Tom Yip (Compliance Officer)
Tel: 604-558-1784
Email: jsong@pretivm.com
Minera Real Del Oro Trade Debt $4,072,845
S.A. De C.V.
Plaza San Pedro No. 113
Durango 34080
Mexico
David A. Ponczoch
Tel: (618) 837-1230
Email: dave.ponczoch@argonautgold.com
Karkour Fine Jewelry, Inc. Trade Debt $3,900,000
628 South Hill Street
Los Angeles CA 90014
Simon Simonian
Tel: (213) 627-3771
Email: ssimonsezz@aol.com
Minera Triton Argentina S.A. Trade Debt $3,558,929
Cordoba 836 7th
Buenos Aires C1054AAU
Argentina
Mariano Petralli
Tel: 011-54 (115) 533-8700
Email: mpetralli@pasargentina.com
GEIB Refining Corporation Trade Debt $3,523,659
399 Kivert Street
Warwick RI 02886
Kenneth Wightman
Tel: (401) 738-8560
Email: paula@geibrefining.com
Midwest Refineries Trade Debt $3,523,046
4471 Forest Ave
Waterford MI 48328
Gary Frenkel
Tel: (248) 674-7305
Email: megacollector@yahoo.com
Coeur Rochester Trade Debt $3,301,965
PO Box 1057 180
Lovelock NV 89419
Tel: (312) 48-5800
Email: metalsales@coeur.com
EZ Pawn Trade Debt $2,837,255
1901 Capital Parkway
Austin TX 78746
Aaron S. Barrett
Tel: (512) 314-3400
Email: aaron_barrett@ezcorp.com
Minera Santa Rita, S.R.L. Trade Debt $2,738,338
De. C.V.
Calle de los Primas No. 81
Colonia-Parque Industrial
Hermosillo, Sonora 83299
Mexico
Francisco Javier Hernandez
Tel: +52 662-217-3707
Email: grace.tang@alamosgold.com
SO Accurate Group, Inc. Trade Debt $2,109,617
31-00 47th Ave 5th Floor
Ste 503
Long Island City NY 11101
Larry Wilson
Tel: (800) 999-2209
Email: lwilson@soaccurate.com
Mid-States Recycling Trade Debt $1,814,399
1841 Busse Highway
Des Plaines IL 60016
Gary Dolinko
Tel: (800) 551-0083
Email: garyd@midstatesrecycling.com
Nusantara de Mexico, S.A. de C.V. Trade Debt $1,727,772
Mariano Escobedo No. 476
Col. Nueva Anzures, Del
Mexico DF 11590
Mexico
Raymon Polman
Tel: (604) 688-3033
Email: mani@firstmajestic.com
Compania Minera Pitalla Trade Debt $1,536,827
S.A. DE C.V.
Blvd. Carlos Quintero Arce No. 24B
Hermosillo, Sonora 83247
Mexico
David A. Ponczoch
Tel: +52 662-136-8080
Email: dave.ponczoch@argonautgold.com
Horizon Metals Trade Debt $1,402,622
5739 W. Howard St
Niles, IL 68050
Tel: (773) 478-8888
Email: bruce@horizonmetals.com
Compania Minera Dolores, Trade Debt $1,250,470
S.A. de C.V.
AV. Ferrocarril NO. 99 /PISO
1 Local 1
Durago 03447
Mexico
Ignacio Couturier/Homero Adamecruz
Tel: +52 618-128-0709
Email: homero.adamecruz@panamericansilver.mx
Oxidos De Pasco SAC Trade Debt $1,191,572
AV. Manuel Olguin #375 URB
Los Granados
Lima, Santigo De Surco 33
Peru
Juan Ignacio De La Torre
Tel: 1-1-511-416-7000
Email: mkoehler@volcan.com.pe
Don David Gold Mexico S.A. DE C.V. Trade Debt $686,000
Calle De Las Rosas No. 339
Colonia Reforma, Oaxaca
De Juarez 68050
Mexico
Tel: (303) 320-7708
Email: rickirvine@goldresourcecorp.com;
johnlabate@goldresourcecorp.com
General Refining and Trade Debt $600,312
Smelting Corporation
59 Madison Ave
Hempstead NY 11550
Peter Spera
Tel: (516) 538-4747
Email: ketty.ruiz@yahoo.com;
mspera83@gmail.com
Export Gold S.A. Trade Debt $514,775
Parque Industrial Chacallut - Local 3
Arica, Chile
Email: gerencia@exportgold.com
QML, Inc. Trade Debt $508,896
272 Ferris Ave
East Providence RI 09216
Brian Budovsky
Tel: (401) 490-4555
Email: manderson@qml.us
Wharf Resources (USA), Inc. Trade Debt $486,383
10928 Wharf Road
Lead SD 57754
Courtney Lynn
Tel: (312) 489-5846
Email: mestalsales@coeur.com
RESOLUTE ENERGY: KEMC Fund Has 11.9% Stake as of Oct. 30
--------------------------------------------------------
KEMC Fund IV GP, LLC, disclosed in a Schedule 13D/A filed with the
Securities and Exchange Commission that as of Oct. 30, 2018, it
beneficially owns 2,762,506 shares of common stock of Resolute
Energy Corporation, which represents 11.9 percent of the shares
outstanding. The 2,762,506 shares of Common Stock beneficially
owned by the Reporting Person were purchased by the Kimmeridge
Funds using the working capital of the Kimmeridge Funds. The total
purchase price for the Shares reported was approximately
$80,070,176.
A full-text copy of the regulatory is available for free at:
https://is.gd/FkOmUY
About Resolute Energy
Based in Denver, Colorado, Resolute Energy Corp. (NYSE:REN) --
http://www.resoluteenergy.com/-- is an independent oil and gas
company focused on the acquisition and development of
unconventional oil and gas properties in the Delaware Basin portion
of the Permian Basin of west Texas.
Resolute incurred a net loss available to common shareholders of
$7.70 million in 2017 following a net loss available to common
shareholders of $161.7 million in 2016. As of June 30, 2018,
Resolute Energy had $826.6 million in total assets, $909.40 million
in total liabilities, and a total stockholders' deficit of $82.77
million.
RMH FRANCHISE: Wants to Maintain Exclusivity Until Jan. 18
----------------------------------------------------------
RMH Franchise Holdings, Inc., and its affiliated debtors request
the U.S. Bankruptcy Court for the District of Delaware to extend
for a period of 60 days, the exclusive periods during which the
Debtors have the exclusive right to file and to solicit acceptances
of a chapter 11 plan of reorganization to, through and including
Jan. 18, 2019 and March 5, 2019, respectively.
Absent the requested extension, the current exclusive filing period
and exclusive solicitation period, as extended by the First
Exclusivity Order, will expire on Nov. 19, 2018 and Jan. 4, 2019,
respectively.
The Debtors have already filed their First Amended Joint Chapter 11
Plan of Reorganization and the Disclosure Statement on Oct. 9,
2018, and intend to seek confirmation of the Plan at the
Confirmation Hearing currently scheduled to occur on Nov. 19, 2018
at 10:00 a.m.
Unless extended, the Exclusive Filing Period will expire the same
day that the Confirmation Hearing commences -- that is on Nov. 19.
Although the Debtors are confident the Plan will be approved, the
Debtors want to preserve their opportunity to make any necessary
amendments to the Plan and solicit acceptances thereof without the
distraction of competing plans. Accordingly, the Debtors are
seeking an extension of the Exclusivity Periods out of an abundance
of caution.
The Debtors contends that they have been operating under the
protection of chapter 11 for just under six months. During this
short period of time, the Debtors have worked diligently to: (i)
obtain critical First Day Relief; (ii) negotiate with their
landlords to renegotiate and amend leases; (iii) close unprofitable
locations; (iv) prepare and file their Schedules of Assets and
Liabilities and Statement of Financial Affairs; (v) obtain the
consensual use of cash collateral; (vi) litigate with Applebee's
regarding their franchise agreements; (vii) prepare and file their
initial and monthly operating reports; and (viii) draft and file
the Plan and Disclosure Statement.
Critically, since filing the First Exclusivity Motion, the Debtors
have obtained rulings from the Court confirming that their
franchise agreements were not terminated prior to the Petition
Date, and approving the Disclosure Statement. Accomplishing these
milestones within just six months has been a labor intensive
process, fully occupying the Debtors and substantially all of the
Debtors' professionals retained in the cases. In light of the
Debtors' accomplishment of several milestones -- in particular, the
filing of the Plan and Disclosure Statement -- the Debtors believe
that each of the factors relevant to these cases weighs in favor of
the requested extension.
About RMH Franchise Holdings
RMH Franchise, headquartered in Atlanta, Georgia --
https://www.rmhfranchise.com/ -- is an Applebee's restaurant
franchisee with over 163 standardized restaurants located across 15
states. RMH Holdings is the direct or indirect parent of each of
the other Debtors. ACON Franchise Holdings, LLC, a non-debtor,
owns 100% of the shares of RMH Holdings.
RMH Franchise Holdings, Inc., and certain of its affiliates filed
Chapter 11 petitions (Bankr. D. Del. Lead Case No. 18-11092) on May
8, 2018. In the petitions were signed Michael Muldoon, president,
RMH Franchise Holdings estimated assets and liabilities of $100
million to $500 million.
Affiliates that concurrently filed voluntary petitions for relief
under Chapter 11 of the Bankruptcy Code are NuLnk, Inc. (Bankr. D.
Del. Case No. 18-11093), RMH Illinois, LLC (Case No. 18-11094), RMH
Franchise Corporation (Case No. 18-11095), and Contex Restaurants,
Inc. (Case No. 18-11096).
The case is assigned to Judge Brendan Linehan Shannon.
Young, Conaway, Stargatt & Taylor, LLP, serves as bankruptcy
counsel to the Debtors; Mastodon Ventures, Inc., is the
restructuring advisor; Hilco Real Estate LLC serves as real estate
broker; and Prime Clerk LLC acts as claims and noticing agent.
On May 24, 2018, the U.S. Trustee appointed an official committee
of unsecured creditors in the Debtors' cases. Kelley Drye & Warren
LLP serves as lead counsel to the Committee while Zolfo Cooper LLC
acts as bankruptcy consultant and financial advisor.
SALLE FAMILY: Seeks Authority to Use Boyd Cash Collateral
---------------------------------------------------------
Salle Family Land Trust, LLC, seeks authority from the United
States Bankruptcy Court for the Western District of North Carolina
to use cash collateral on an interim basis to operate in the
ordinary course of business as set forth on the budget.
The Debtor presently receives rent from a long-term tenant in the
amount of $3,892 at the property located at 103 Blackpoint Drive.
The Debtor also collects an average of $1,250 per month from short
term rentals at the property located at 137 North Ridge Lane. The
Debtor collects rent from four tenants, with monthly rent receipts
of $17,700.
The Debtor claims that it will be unable to maintain the payment of
necessary expenses if it is not allowed to use the rental income
for that purpose. The proposed budget provides total monthly
expenses of approximately $6,138.
The Debtor's primary secured creditor, Boyd Hard Money Lending,
LLC, holds of a claim for $317,737, secured by a first lien deed of
trust on the residential property located at 103 Blackpoint Drive,
Newland, NC. Boyd purportedly holds a security interest in all
rents and profits derived from the premises, by way of an
assignment of rents and profits clause contained in the Deed of
Trust.
Boyd also holds of a claim for the approximate amount of $391,857,
secured by a first lien deed of trust on the residential property
located at 137 North Ridge Lane, Newland, NC. Boyd purportedly
holds a security interest in all rents and profits derived from the
premises, by way of an assignment of rents and profits clause
contained in the Deed of Trust.
The Debtor also seeks an order authorizing it to commence monthly
payments in the amount of $3,548 to Boyd Hard Lending, LLC
beginning November 1, 2018 and continuing to be paid on the 1st day
of each month thereafter until the confirmation of the Debtor's
Chapter 11 Plan.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/ncwb18-10214-50.pdf
About Salle Family Land Trust
Salle Family Land Trust, LLC, is engaged in activities related to
real estate. The company is the fee simple owner of three real
properties located in Newland and Burnsville, North Carolina,
valued by the company at $1.03 million in the aggregate.
Salle Family Land Trust filed a voluntary Chapter 11 petition
(Bankr. W.D.N.C. Case No. 18-10214) on May 25, 2018. In the
petition signed by David Salle, managing member, the Debtor
disclosed $1.03 million in total assets and $644,798 in total
liabilities. The case is assigned to Judge George R. Hodges.
Benson T. Pitts, Esq., at Pitts, Hay & Hugenschmidt, P.A., is the
Debtor's counsel.
SCURRY COUNTY: Moody's Affirms Ba2 Issuer Ratings, Outlook Neg.
---------------------------------------------------------------
Moody's Investors Service has affirmed Scurry County Hospital
District, TX's issuer and general obligation limited tax ratings at
Ba2, affecting $1.1 million of rated debt. The outlook remains
negative.
RATINGS RATIONALE
The Ba2 rating reflects the district's extremely limited financial
flexibility due very weak liquidity, which is not expected to
materially improve over the near term. The rating also reflects a
moderately sized tax base that remains subject to significant
volatility given oil and gas exposure, an elevated debt profile,
and a manageable pension liability.
The lack of distinction between the issuer and GOLT ratings
reflects the district's ample taxing headroom, which offsets the
limitation under the property tax cap, lack of full faith and
credit pledge, and inability to override the constitutional tax
cap.
RATING OUTLOOK
The negative outlook reflects a historically volatile operating
performance, which could continue over the near term, as well as
its expectation that the district will remain challenged to
materially improve its very weak liquidity position.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Substantially improved liquidity
- Trend of favorable operating margins
- Moderation of debt profile
- Diversification of the tax base
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Continued tax base contraction or significant reduction of tax
rate margin
- Further decline in liquidity and/or operating margins
- Material increase in balance sheet leverage
LEGAL SECURITY
The bonds represent direct obligations of the district, payable
from the levy and collection of a direct and continuing ad valorem
tax, limited to $5.00 per $1,000 of value, on all taxable property
within the district's boundaries.
USE OF PROCEEDS
Not applicable
PROFILE
Scurry County Hospital District is a political subdivision of the
State of Texas (Aaa stable), coterminous with Scurry County. The
hospital district operates the Cogdell Memorial Hospital located in
the City of Snyder, as well as other health and wellness
facilities. The hospital is a Critical Access Hospital with 25
licensed beds and provides inpatient, outpatient and emergency care
services. In 2016, Scurry County's population was 17,314.
METHODOLOGY
The principal methodology used in this rating was US Local
Government General Obligation Debt published in December 2016. An
additional methodology used in this rating was Not-For-Profit
Healthcare published in November 2017.
SEADRILL LIMITED: Bank Debt Trades at 6% Off
--------------------------------------------
Participations in a syndicated loan under which Seadrill Limited is
a borrower traded in the secondary market at 93.85
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.89 percentage points from the
previous week. Seadrill Limited pays 600 basis points above LIBOR
to borrow under the $11 million facility. The bank loan matures on
February 21, 2021. Moody's rates the loan 'CCC+ ' and Standard &
Poor's gave a 'CCC+' rating to the loan. 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
Friday, October 26.
SEMLER SCIENTIFIC: Reports Net Income of $1.5 Million for Q3
------------------------------------------------------------
Semler Scientific, Inc., has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting net income
of $1.46 million on $5.57 million of revenues for the three months
ended Sept. 30, 2018, compared to a net loss of $41,000 on $3.60
million of revenues for the three months ended Sept. 30, 2017.
For the nine months ended Sept. 30, 2018, the Company reported net
income of $3.62 million on $15.52 million of revenues compared to a
net loss of $1.76 million on $8.23 million of revenues for the same
period last year.
As of Sept. 30, 2018, Semler Scientific had $7.04 million in total
assets, $4.71 million in total current liabilities, $12,000 in
total long-term liabilities and $2.31 million in total
stockholders' equity.
The Company had cash of $3,087,000 at Sept. 30, 2018 compared to
$1,457,000 at Dec. 31, 2017, and total current liabilities of
$4,719,000 at Sept. 30, 2018 compared to $5,140,000 at Dec. 31,
2017. As of Sept. 30, 2018 the Company had working capital of
approximately $1,019,000. During the nine months ended Sept. 30,
2018, the Company reduced total liabilities by $2,090,000 as
compared to the year ended Dec. 31, 2017, as the Company retired
debts and reduced accounts payable, among other items.
Prior to the three months ended Dec. 31, 2017, the Company had
incurred losses since inception as a result of costs and expenses
related to its marketing and other promotional activities, and
continued research and development of its products and services.
The Company's principal sources of cash have included the issuance
of equity, including its February 2014 initial public offering of
common stock, and private placement offerings of common stock,
borrowings under loan agreements, the issuance of promissory notes,
and revenues from its vascular testing product.
"There is no guarantee that we will continue to generate sufficient
cash from operations to remain profitable or that we will be able
to raise additional financing from other sources. For these
reasons, our independent registered public accountants' report for
the year ended December 31, 2017 includes an explanatory paragraph
that expresses substantial doubt about our ability to continue as a
"going concern."
"Although we do not have any current capital commitments, we expect
that we may increase our expenditures to continue our efforts to
grow our business and commercialize our products and services.
Accordingly, we currently expect to make additional expenditures in
both sales and marketing, and invest in our corporate
infrastructure. We also expect to invest in our research and
development efforts. We do not have any definitive plans as to the
exact amounts or particular uses at this time, and the exact
amounts and timing of any expenditure may vary significantly from
our current intentions. If we are unable to generate sufficient
cash from operations, we may need to obtain additional financing.
There is no assurance that additional financing will be available
when needed or that management will be able to obtain financing on
acceptable terms should the company not sustain a profitable
business with positive operating cash flow. If we are unable to
raise sufficient additional funds when and if necessary, we may
need to curtail making additional expenditures and could be
required to scale back our business plans, or make other changes
until sufficient additional capital is raised to support further
operations. There can be no assurance that such a plan will be
successful," the Company stated in the Quarterly Report.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/UTq580
About Semler Scientific
Semler Scientific, Inc. -- http://www.semlercientific.com/-- is an
emerging growth company that provides technology solutions to
improve the clinical effectiveness and efficiency of healthcare
providers. Semler Scientific's mission is to develop, manufacture
and market innovative proprietary products and services that assist
its customers in evaluating and treating chronic diseases. The
company is headquartered in San Jose, California.
Semler Scientific incurred a net loss of $1.51 million in 2017 and
a net loss of $2.55 million in 2016. As of June 30, 2018, the
Company had $5.31 million in total assets, $5.07 million in total
current liabilities, $18,000 in total long-term liabilities and
$216,000 in total stockholders' equity.
The Company's independent registered public accountants' report for
the year ended Dec. 31, 2017 includes an explanatory paragraph that
expresses substantial doubt about its ability to continue as a
"going concern." BDO USA, LLP, in New York, stated that the
Company has negative working capital, a stockholders' deficit, and
recurring losses from operations that raise substantial doubt about
its ability to continue as a going concern.
SHIV JI SHANKER: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Shiv Ji Shanker, LLC
dba Columbus Georgia Country Inn & Suites
5435 Chelsenwood Drive
Duluth, GA 30097
Business Description: Shiv Ji Shanker, LLC is a privately held
company in Duluth, Georgia in the traveler
accommodation industry. The Company
previously sought bankruptcy protection on
Oct. 1, 2018 (Bankr. M.D. Ga. Case No. 18-
40975).
Chapter 11 Petition Date: October 31, 2018
Court: United States Bankruptcy Court
Middle District of Georgia (Columbus)
Case No.: 18-41078
Judge: Hon. John T. Laney III
Debtor's Counsel: Joseph H. Turner, Jr., Esq.
JOSEPH H. TURNER JR., PC
580 Cliftwood Ct NE
Sandy Springs, GA 30328
Tel: 770-480-1939
Email: jhtlaw@comcast.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Janita Patel, member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/gamb18-41078.pdf
SILVER SCREEN: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Silver Screen Rentals, L.L.C.
500 Edwards Avenue
New Orleans, LA 70123
Business Description: Silver Screen Rentals was founded in 2009 as
a full-service location equipment
rentals company in Louisiana. Created to
cater to the specific and time-sensitive
needs of the film industry, Silver Screen
offers everything a locations department
needs: a large assortment of tents, portable
air conditioners and heaters, generators,
temporary flooring, tables & chairs, makeup
stations, passenger vans, carts, dollies and
more. Silver Screen now has a new location
at 5169 Southridge Parkway in Atlanta,
Georgia. In Louisiana, Silver Screen's
facility is located at 500 Edwards Ave in
New Orleans. For more information, call
404.445.5534 or visit
www.silverscreenrentals.com.
Chapter 11 Petition Date: November 1, 2018
Court: United States Bankruptcy Court
Eastern District of Louisiana (New Orleans)
Case No.: 18-12934
Judge: Hon. Elizabeth W. Magner
Debtor's Counsel: William H. Patrick, III, Esq.
HELLER, DRAPER, PATRICK, HORN & MANTHEY LLC
650 Poydras Street, Suite 2500
New Orleans, LA 70130
Tel: (504) 299-3300
Fax: (504) 299-3399
E-mail: wpatrick@hellerdraper.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by R. Bryan Wright, manager.
The Debtor did not submit a list of its 20 largest unsecured
creditors at the time of the filing.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/laeb18-12934.pdf
SILVERADO STAGES: May Use Cash Collateral on Interim Basis
----------------------------------------------------------
The Hon. Madeleine C. Wanslee of the U.S. Bankruptcy Court for the
District of Arizona has signed a stipulated interim order
authorizing Silverado Stages, Inc.'s limited use of cash
collateral.
The Debtors are authorized, on an interim basis, to use the cash
collateral to pay ordinary, necessary, and essential post-petition
operating expenses as reflected in the Budget. The Debtors may use
the unencumbered $190,000 in loan proceeds from Nineveh Holdings,
LLC to pay estate professionals, in accordance with the Bankruptcy
Court's orders.
Western Alliance Bank ("WAB") alleges that it holds a lien against,
among other collateral, all cash and accounts receivable as
security for repayment of an indebtedness in the alleged aggregate
amount of at least $7,420,936.
The Debtors will make a payment to Western Alliance Bank in the
amount of $31,000.00 on or before November 1, 2018. WAB and the
Debtors reserve all rights regarding WAB's application of the
$31,000.00 payment.
Western Alliance Bank is granted replacement liens on and security
interests in all existing and hereinafter acquired property and
assets of the Debtors of every kind and character, to the extent
and in the same validity, priority, and enforceability that WAB
held liens on and security interests in such kind and character of
property and assets of the Debtors as of the commencement of
Debtor's Case, including without limitation the Cash Collateral.
A final hearing on the Cash Collateral Motion is scheduled for
November 6, 2018 at 11:00 a.m.
A full-text copy of the Stipulated Interim Order is available at
http://bankrupt.com/misc/azb18-12203-61.pdf
About Silverado Stages
Headquartered in Phoenix, Arizona, Silverado Stages, Inc. --
https://silveradostages.com/ -- with 10 locations on the West
Coast, is a federally licensed motor carrier and operates as a
Public Stage under California DOT authority. The company is
additionally certified as a U.S. Department of Defense motor
carrier to provide transportation for the military and by the CHP
as a School Pupil Activities Bus (SPAB) operator.
Silverado Stages was founded in 1987 and has had the most diverse
background in passenger operations. It operates a diverse fleet of
over 300 passenger vehicles, over 60 of which are ADA compliant.
It currently operates from terminals in San Luis Obispo,
Sacramento, Santa Barbara, Torrance, San Diego, Reno, and Las
Vegas.
Silverado Stages and seven of its affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case Nos.
18-12203, 18-12205, 18-12207, 18-12209, 18-12210, 18-12213,
18-12215 and 18-12218) on Oct. 5, 2018.
In the petitions signed by James Galusha, chairman, Silverado
Stages estimated $10 million to $50 million in assets and $50
million to $100 million in liabilities as of the bankruptcy
filing.
The Debtor hired Sonoran Capital Advisors, LLC, and appointed the
firm's managing director Matthew Foster as chief restructuring
officer.
SINGLETON FOOD: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Singleton Food Services, Inc.
772 Maddox Drive, Suite 136
Ellijay, GA 30540
Business Description: Singleton Food Services, Inc. is a privately
held company in Ellijay, Georgia operating
in the restaurants industry.
Chapter 11 Petition Date: November 3, 2018
Court: United States Bankruptcy Court
Northern District of Georgia (Gainesville)
Case No.: 18-22157
Debtor's Counsel: Scott B. Riddle, Esq.
LAW OFFICE OF SCOTT B. RIDDLE, LLC
Suite 1800 Tower Place
3340 Peachtree Road, NE
Atlanta, GA 30326
Tel: 404-815-0164
Fax: 404-815-0165
Email: scott@scottriddlelaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Edward J. Singleton, Jr., chairman and
CEO.
The Debtor failed to submit a list of its 20 largest unsecured
creditors at the time of the filing.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/ganb18-22157.pdf
SMTT INC: Seeks Authority on Interim Cash Collateral Use
--------------------------------------------------------
SMTT, Inc., requests the U.S. Bankruptcy Court for the Southern
District of Indiana for an interim order (a) directing Fed Ex
Ground Package System, Inc., to pay its debt to the Debtor pursuant
to its normal terms of payment and (b) authorizing the Debtor's use
of cash collateral substantially in accordance with the Budget.
Advantage Capital Funding currently has a garnishment order on the
Debtor's receivables from Fed Ex Ground Package System through a
Judgment in the Supreme Court of New York, County of Ontario, Index
File 118727/2018. The Debtor asserts that these funds are
necessary to fund its business and are protected by the Cash
Collateral Order that the Debtor currently sought.
The Debtor is indebted to Advantage Capital Funding in the claimed
amount of $185,012 by virtue of a loan made on April 30, 2018,
which is secured by all assets of the Debtor.
The Debtor believes that Swift Financial LLC, successor in interest
to Celtic Bank Corporation, may claim second secured interest in
Debtor's assets by virtue of a loan from Celtic Bank made on
January 3, 2018.
The Debtor believes the costs of continuing to operate its business
are less than the income it will generate from such operations
overtime, thereby creating replacement collateral for the
protection of its Secured Creditors and posing no threat to its
unsecured creditors.
As adequate protection for the use of cash collateral, the Debtor
proposes the following:
(a) Advantage Capital Funding will be granted replacement
liens on post-petition receivables and accounts to the same extent
and validity as such liens existed in the prepetition cash
collateral;
(b) The Debtor will pay $2,000 per month to the secured debt
to Advantage Capital Funding Starting November 1, 2018; and
(c) The Debtor will continue to maintain appropriate insurance
and pay tax obligations as they come due.
(d) There will be no payments or replacement security to Swift
Financial since its claim is totally unsecured.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/insb18-07892-2.pdf
About SMTT Inc.
SMTT provides delivery services for Fed Ex Ground Package System,
Inc. by utilizing 10 trucks leased from Ryder to make deliveries.
The Company's primary business operations are in Indianapolis,
Indiana. SMTT is managed by its owner, Cherie Smith.
SMTT, Inc., sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D. Ind. Case No. 18-07892) on Oct. 15, 2018. In the
Petition signed by its president, Cherie D. Smith, the Debtor
estimated assets and liabilities of less than $50,000 each. Judge
Robyn L. Moberly presides over the case. The Debtor tapped Redman
Ludwig P.C. as its legal counsel.
SOUTHEASTERN HOSPITALITY: Seeks Authority to Use Cash Collateral
----------------------------------------------------------------
Southeastern Hospitality, LLC, d/b/a The Mercury, seeks authority
from the United States Bankruptcy Court for the Northern District
of Georgia to use cash collateral to meet its ordinary operating
expenses and maintain its business.
The Debtor claims that it has no other source of income other than
the cash collateral. The Debtor has prepared a budget of projected
income and expenses for the next six months. The budget provides
total operating expenses of approximately $441,070 and other
expenses of $77,500 during the months of October 2018 through March
2019.
The Debtor believes that these Creditors may assert an interest in
the accounts of its Business -- The Mercury, a restaurant owned and
operated by the Debtor:
(a) 1st Global Capital, LLC asserts a security interest for
its claim of approximately $91,186;
(b) BFS Capital asserts a security interest for its claim of
approximately $91,186;
(c) Bizfund, LLC asserts a security interest for its claim of
approximately $91,186;
(d) Dau Group Investments, LLC asserts a security interest for
its claim of approximately $234,218; and
(e) PBS Capital asserts a security interest for its claim of
approximately $91,186.
To the extent that Debtor uses the cash collateral, the Debtor
proposes to grant all Creditors replacement liens in revenue
generated post-petition of the same kind, extent, and priority as
those existing prepetition.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/ganb18-67291-9.pdf
About Southeastern Hospitality
Southeastern Hospitality, LLC dba The Mercury is a
cocktail-focused, classic American eatery located in Ponce City
Market, Atlanta, Georgia. The Mercury sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No.
18-67291) on October 12, 2018. In the petition signed by Earl E.
Cloud III, owner, the Debtor estimated assets of less than $50,000
and liabilities of less than $10 million. The Debtor tapped
William Anderson Rountree, Esq., of Rountree & Leitman, LLC, as its
counsel.
SOVOS BRANDS: Moody's Assigns B3 CFR, Outlook Stable
----------------------------------------------------
Moody's Investors Service, Inc. assigned a first-time B3 Corporate
Family Rating and B3-PD Probability of Default Rating to Sovos
Brands Intermediate, Inc. Moody's also assigned a B3 rating to the
company's proposed $280 million seven-year senior secured term loan
and $50 million undrawn senior secured five-year revolving credit
facility. Proceeds from the term loan will be used to partially
fund the acquisition by Sovos Brands of premium yoghurt company
Noosa Yoghurt, LLC, refinance existing debt, and pay transaction
fees and expenses. Noosa management will retain a small portion of
their equity holdings in the company. The ratings outlook is
stable.
The following ratings were assigned:
Sovos Brands Intermediate, Inc:
Corporate Family Rating at B3;
Probability of Default Rating at B3-PD;
$280 million senior secured term loan due 2025 at B3 (LGD 4);
$50 million senior secured revolving credit facility expiring 2023
at B3 (LGD 4).
The outlook on all ratings is stable.
RATINGS RATIONALE
The B3 Corporate Family Rating reflects Sovos Brand's high
financial leverage, limited operating history, and near-term
negative free cash flows. The rating is supported by the solid and
growing brand equity and attractive profit margins of its "Rao's"
and "noosa" brands, which together comprise over 75% of total
company sales. Including the company's "Michael Angelo's" brand,
Sovos Brands has good segmental sales diversification in pasta
sauce, yoghurt, and frozen meals. Event risk is high due to Sovos
Brand's long-term growth strategy that will include future
acquisitions.
Moody's takes into consideration recent declining sales volume in
the US yoghurt category that is likely to persist over the next
year. This will be an ongoing and considerable headwind to "noosa"
brand's growth prospects, which partly rely on the company's
ability to extend the brand into new product adjacencies. By
contrast, Moody's expects continued strong sales growth in the
"Rao's" business, driven by further national distribution gains of
the premium pasta sauce brand. Finally, sales under the smaller
"Michael Angelo's" brand should remain relatively stable over the
next year. However the brand will face increasing competition in
the U.S. frozen meals as the sector continues to consolidate among
a handful of large players.
Closing leverage, based on Moody's adjusted debt/EBITDA before
transaction synergies and various company add-backs, approximates
8.6 times. Leverage could decline by as much as a full turn per
year solely through earnings growth. This is provided that the
company successfully captures the $8 million of budgeted
transaction synergies and achieves profitable growth in key
segments as planned. Debt balances will be generally flat over the
next 24 months due to limited free cash flow. Elevated planned
capital investments will generate negative free cash flow in 2019.
Ratings could be upgraded if Sovos Brands sustains stable operating
performance in key segments, debt/EBITDA below 7.0x, and
EBITA/interest above 1.5x. In addition the company will need to
generate positive free cash flow before Moody's would consider an
upgrade.
Ratings could be downgraded if operating performance deteriorates,
financial leverage increases further, or EBITA/interest falls below
1.0x. Ratings also could be downgraded if significantly negative
free cash flow persists beyond the integration of Noosa, or if for
any reason liquidity weakens.
Berkley, CA based Sovos Brands was formed in 2016 by private equity
firm Advent International as a platform to build a diversified
branded packaged food company, principally through acquisitions.
Since inception, the company has acquired two major brands: Michael
Angelo's frozen Italian meals in January 2017 and Rao's pasta
sauces in July 2017. With the acquisition Noosa yoghurt, the
company's pro forma annual sales will approximate $340 million.
The principal methodology used in these ratings was Global Packaged
Goods published in January 2017.
SOVOS BRANDS: S&P Assigns B- Issuer Credit Rating, Outlook Positive
-------------------------------------------------------------------
S&P Global Ratings assigned a 'B-' issuer credit rating to
Berkeley, Calif.-based Sovos Brands Intermediate Inc. (Sovos
Brands). The outlook is positive.
S&P said, "At the same time, we assigned a 'B-' issue-level and '3'
recovery rating to the proposed $50 million secured revolving
credit facility due in 2023 and $280 million first-lien term loan
due in 2025. The '3' recovery rating indicates our expectation for
meaningful (50%-70%; rounded estimate 55%) recovery in the event of
a payment default." The company will have $280 million of reported
debt outstanding pro forma for the acquisition.
The 'B-' issuer credit rating on Sovos Brands reflects its limited
history and still-evolving acquisition strategy, despite debt
leverage and expected free operating cash flows that could possibly
support a higher rating if achieved as currently projected. This
includes debt to EBITDA near or above 6x, largely unchanged form
pro form leverage of about 6x for this transaction because of
likely ongoing acquisitions. The company was formed when Sovos
Brands bought Rao's in July 2017 and Michael Angelo's in February
2017. Rao's is the portfolio's strongest brand, with its
high-quality pasta sauce and clean ingredients produced with
Italian products. Michael Angelo's is a premium authentic frozen
Italian entrees producer also using clean ingredients. Both brands
command premium pricing because of their high-quality ingredients
with no fillers or preservatives, and continue to grow market share
at the expense of mainstream brands.
S&P said, "The positive outlook reflects the possibility for a
higher rating if the company successfully executes on its strategy
to combine its three brands into one company and generates
sufficient EBITDA and free operating cash flow to service its debt.
If the company continues to expand its fast-growing Rao's brand
into new retailer channels, steadily grows its more niche frozen
Michael Angelo's brand, and stabilizes noosa, we believe the
company can sustain EBITDA margins in around 16% and generate
annual free operating cash flow near $20 million. Achieving these
operating and cash flow metrics would keep debt to EBITDA well
below 7x. Therefore, we could raise the rating to 'B' if the
company attains these operating and cash flow metrics over the next
year.
"We could revise the outlook to stable if debt to EBITDA is
sustained above 7x or if annual FOCF does not materialize as
expected and remains well below $10 million. A sudden decline in
market share gains in key products or unforeseen integration delays
could cause this. Specifically, if the current favorable growth
rates at Rao's unexpectedly declines or if the company is unable to
execute its strategy on stabilizing noosa, the company's EBITDA
margins could decline by more than 300 basis points, lead to
closer-to-break-even cash flow and increase debt leverage well
above 7x . We could also change the outlook to stable if the
company adopts a more aggressive financial policy through largely
debt-financed acquisitions that leads to debt leverage sustained
above 7.0x."
ST. JUDE NURSING: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: St. Jude Nursing Center, Inc.
721 Elmwood
Troy, MI 48083
Business Description: St. Jude Nursing Center is a privately
owned and licensed long-term skilled nursing
facility located at 34350 Ann Arbor Trail,
Livonia, Michigan 48150. The Facility
consists of 64 licensed beds, located within
the Debtor-owned facility. The Facility
offers services such as skilled nursing
care, hospice care, Alzheimer's and dementia
patient care, physical rehabilitation,
tracheal and enteral services, wound care,
and short-term respite care. The Company
previously sought bankruptcy protection
on Feb. 18, 2016 (Bankr. E.D. Mich. Case No.
16-42116) and Feb. 22, 2012 (Bankr. E.D.
Mich. Case No. 12-43956).
Chapter 11 Petition Date: November 2, 2018
Court: United States Bankruptcy Court
Eastern District of Michigan (Detroit)
Case No.: 18-54906
Judge: Hon. Thomas J. Tucker
Debtor's Counsel: Jeffrey S. Grasl, Esq.
GRASL PLC
31800 Northwestern Hwy., Suite 350
Farmington Hills, MI 48334
Tel: (248) 385-2980
E-mail: jeff@graslplc.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Bradley Mali, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/mieb18-54906.pdf
STEPHANIE N. MAPP: Seeks Authorization to Use Cash Collateral
-------------------------------------------------------------
Stephanie N. Mapp, D.M.D., P.A., seeks authorization from the U.S.
Bankruptcy Court for the Middle District of Florida to use cash
collateral in the ordinary course of its business to the extent
provided in the Budget.
Prior to the Petition Date, the Debtor entered into certain Notes
and Agreements with American Enterprise Bank of Florida.
Consequently, American Enterprise Bank of Florida had liens on the
Debtor's personal property, including inventory and the proceeds
thereof. At some point after the Debtor entered into the Agreements
with American Enterprise Bank the FDIC assigned the Agreements to
Fidelity Bank.
The Debtor has prepared a detailed budget and intends on offering
replacements liens to Fidelity Bank in order to protect the Bank's
interest. In addition to replacement liens, the Debtor is willing
to offer a monthly adequate protection payment to be agreed upon by
the parties. The Debtor assures the Court to work with Fidelity
Bank in order to get an agreed order on the Cash Collateral
Motion.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/flmb18-03612-7.pdf
About Stephanie N. Mapp
Stephanie N. Mapp, D.M.D., P.A., a dental practice located in
Fleming Island, Florida, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 18-bk-03612) on Oct. 15,
2018. At the time of the filing, the Debtor estimated assets of
less than $500,000 and liabilities of less than $1 million. Judge
Paul M. Glenn presides over the case. The Debtor tapped The Law
Offices of Jason A. Burgess, LLC, as its legal counsel.
SUGARLOAF HOLDINGS: Seeks Authorization to Utilize Cattle Proceeds
------------------------------------------------------------------
Sugarloaf Holdings, LLC, asks the U.S. Bankruptcy Court for the
District of Utah interim approval for its use of cash collateral to
provide sufficient funds for working capital required to continue
its business operations.
As of the Petition Date, the Debtor is in possession of a check for
$568,359, which represents proceeds for the sale of cattle and is
made out to both the Debtor and Bank of the West. The Debtor has
minimal accounts receivable and little cash on hand. The Debtor
requires the immediate use of the Cattle Proceeds, as future
revenues depend on planting and maintaining operations now.
Among the Debtor's most urgent needs, is the requirement to prepare
for future growing. The Debtor is currently facing an imperative
need to plant and prepare future crops as it is the lifeblood of
its operations. In addition, the Debtor will use cash collateral:
(a) to pay post-petition operating expenses incurred in the
ordinary course of business; (b) to pay costs and expenses of
administration of the Case, including payment of approved
professional fees; and to pay other amounts specified in the Budget
and allowed by the Court, in each case, in amounts and categories
consistent with the Budget so long as it does not exceed by up to
10% on average during any 3-month period.
Based on multiple past experiences, the Debtor believes that if it
were to deposit the Cattle Proceeds, Bank of the West would sweep
the account and leave the Debtor without cash or the ability to pay
expenses until it was potentially too late. Accordingly the Debtor
seeks an order from the Court requiring Bank of the West to endorse
the check, execute any documents required to release the Cattle
Proceeds and allow the funds to be deposited in the
debtor-in-possession account.
Bank of the West is owed approximately $9,565,400, and holds a
first position Deed of Trust, secured by the Debtor's real
property. Bank of the West is also owed $2,899,372, secured by
Debtor's accounts, chattel paper, goods, inventory, equipment, farm
products, instruments, investment property, documents, commercial
tort claims, deposit accounts, letter-of-credit rights, general
intangibles, supporting obligations, and records of accession to
and proceeds and products of the foregoing.
In addition, the Debtor has also received additional secured
financing from: (a) AGCO Finance LLC, which is owed approximately
$540,838, holds a lien secured by certain items of equipment; (b)
Farm Credit Leasing Corp., which is owed approximately $297,408,
holds a lien secured by certain items of equipment; and (c) John
Deere, holds a lien in the approximate sum of $291,896, secured by
titled vehicles and equipment.
In November 2016, Bank of the West ordered an appraisal of the
Debtor's real property, which estimated the value of the Debtor's
property at $14,716,000. The Debtor owns additional personal
property worth approximately $6,351,619. The total value of the
Debtor's assets as of the Petition Date is $21,067,619, while the
Debtor's total liabilities are $15,716,413. The Debtor's total
equity is conservatively $5,351,2016 or 25.4%.
The Debtor claims that Bank of the West is adequately protected by
an equity cushion that exceeds the threshold of 20% -- the Debtor's
25.76% equity more than adequately protects the interests of Bank
of the West.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/utb18-27705-6.pdf
About Sugarloaf Holdings
Sugarloaf Holdings, LLC -- http://sugarloafholdings.com/-– is a
privately held company in Lehi, Utah, whose business consists of
farming and ranching operations.
Sugarloaf Holdings filed a Chapter 11 petition (Bankr. D. Utah Case
No. 18-27705) on Oct. 15, 2018. In the petition signed by David J.
Gray, manager, the Debtor disclosed $21,067,619 in total assets and
$15,666,618 in total debt. The case is assigned to Judge Kevin R.
Anderson. The Debtor is represented by Parsons Behle & Latimer.
TEMPEST GROUP: Chicago Title Opposes Approval of Plan Outline
-------------------------------------------------------------
Chicago Title Insurance Company asked the U.S. Bankruptcy Court for
the Western District of Pennsylvania to deny the disclosure
statement filed by Tempest Group, LLC, saying it does not contain
"adequate information."
In court filings, Chicago Title's attorney, Gregory Michaels, Esq.,
at Dickie, McCamey & Chilcote, PC said Tempest Group's proposed
Chapter 11 plan discloses certain information not found in its
disclosure statement.
"In the proposed plan, [Tempest Group] states conditions for
payment of Chicago Title's claim that are completely absent from
the disclosure statement," Mr. Michaels said.
Mr. Michaels further said that Tempest Group also mentions in the
proposed plan that Chicago Title's claim should be reduced by the
payments made by the company after approval of its first confirmed
plan although no such payments were made.
"If [Tempest Group] has proof of such payments, it should have been
identified in the disclosure statement," the attorney pointed out.
"The absence of information and the disclosure of these additional
provisions related to the treatment of Chicago Title's claim in the
disclosure statement renders the disclosure statement deficient."
Mr. Michaels maintains an office at:
Gregory C. Michaels, Esq.
Dickie, McCamey & Chilcote, PC
Two PPG Place, Suite 400
Pittsburgh, PA 15222-5402
Phone: (412) 392-5355
Fax: (412) 392-5367
Email: gmichaels@dmclaw.com
About Tempest Group
Tempest Group, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Pa. Case No. 16-24204) on November 10,
2016. In the petition signed by Joann Jenkins, manager, the Debtor
estimated assets and liabilities of less than $1 million.
Judge Carlota M. Bohm presides over the case. The Debtor hired
Calaiaro Valencik as its legal counsel.
No official committee of unsecured creditors has been appointed.
TURN-KEY SPECIALISTS: U.S. Trustee Forms 3-Member Committee
-----------------------------------------------------------
The Office of the U.S. Trustee on Oct. 31 appointed three creditors
to serve on the official committee of unsecured creditors in the
Chapter 11 case of Turnkey Specialists, Inc.
The committee members are:
(1) Elaine Lanier
D & R Pipe Fab. Plus. Inc.
P.O. Box 159, Brookshire, TX 77423
Telephone: 281-375-2401
Email: dr.pipe@att.net
c/o Julia Cook, Schlanger
Silver Barge & Paine
109 N. Post Oak, Suite 300
Houston, TX 77024
Telephone: 713-735-8561
Email: jcook@ssbpaine.com
(2) Keith R. Knauerhase
ABB, Inc.
131 Phoenix Crossing
Bloomfield, CT 06002
Telephone: 860-969-5302
Email: keith.r.knauerhase@us.abb.com
c/o Patrick M. Birney
Robinson & Cole, LLP
280 Trumbull St.
Hartford, CT 06103
Telephone: 860-275-8275
Email: pbirney@rc.com
(3) Steve M Steen
Diamond G. Inspection, Inc.
11050 West Little York, Bldg. G.
Houston, TX 77041
Telephone: 713-937-8168
Email: seve4@msn.com
c/o Bruce Lloyd
Jones, Gillaspia & Lloyd, LLP
4400 Post Oak Parkway, Suite 2360
Houston, TX 77027
Telephone: 713-225-6126
Email: bruse@jgl-law.com
Official creditors' committees have the right to employ legal and
accounting professionals and financial advisors, at a debtor's
expense. They may investigate the debtor's business and financial
affairs. Importantly, official committees serve as fiduciaries to
the general population of creditors they represent.
About Turn-Key Specialists
Turn-Key Specialists, Inc., sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. S.D. Tex. Case No. 18-33170) on June 7,
2018. At the time of the filing, the Debtor estimated assets of
$1,000,001 to $10 million and liabilities of $1,000,001 to $10
million. Judge Jeff Bohm presides over the case. The Debtor hired
Larry Vick, Esq., as its legal counsel.
UNITI GROUP: Posts $2.07 Million Net Income in Third Quarter
------------------------------------------------------------
Uniti Group Inc. has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting net income
attributable to common shareholders of $2.07 million on $252.63
million of total revenues for the three months ended Sept. 30,
2018, compared to net income attributable to common shareholders of
$2.93 million on $245.21 million of total revenues for the three
months ended Sept. 30, 2017.
For the nine months ended Sept. 30, 2018, the Company reported a
net loss attributable to common shareholders of $4.35 million on
$746.88 million of total revenues compared to a net loss
attributable to common shareholders of $37.09 million on $669.69
million of total revenues for the same period last year.
Uniti Fiber contributed $70.1 million of revenues and $28.5 million
of Adjusted EBITDA for the third quarter of 2018, reporting
Adjusted EBITDA margins of approximately 41%. Uniti Fiber's net
success-based capital expenditures during the quarter were $33.6
million, and maintenance capital expenditures were $1.0 million.
At Sept. 30, 2018, Uniti Fiber had over $1.3 billion of revenues
under contract, a 3% increase over pro-forma year-ago levels.
Uniti Towers contributed $4.3 million of revenues and reported
Adjusted EBITDA of $1.2 million for the quarter, which included
$0.4 million of development costs reimbursed in connection with
sites canceled by its customers. Uniti Tower's total capital
expenditures for the third quarter were $24.5 million and included
the completion of construction of 47 towers in the U.S., 10 towers
in Mexico, and closing on the acquisition of 23 NMS development
towers. At quarter end, Uniti Towers had 847 towers in service and
approximately 252 towers in varying stages of development.
Uniti Leasing had revenues of $174.8 million and Adjusted EBITDA of
$174.1 million for the third quarter. The Consumer CLEC business
had revenues of $3.4 million for the third quarter, achieving
Adjusted EBITDA margins of approximately 23%.
As of Sept. 30, 2018, Uniti had $4.57 billion in total assets,
$5.89 billion in total liabilities, $85.76 million in convertible
preferred stock, and a total shareholders' deficit of $1.40
billion.
Investment Transactions
On Oct. 19, 2018, the Company acquired Information Transport
Solutions, Inc. for all cash consideration of $54.0 million. ITS
is a full-service provider of technology solutions, primarily to
educational institutions in Alabama and Florida. Over 30% of ITS's
total revenue is on Unit Fiber's network, which is expected to
increase under Uniti Fiber's ownership. ITS reported revenues of
over $45 million in 2017.
"We are pleased to announce the acquisition of Information
Transport Solutions, Inc., a full service provider of technology
solutions for educational institutions in the Southeast. This
acquisition expands Uniti Fiber's product offerings and strengthens
relationships with many new and existing E-Rate customers,"
commented Kenny Gunderman, president and chief executive officer.
Mr. Gunderman continued "I also want to especially commend our
Uniti Fiber team for their tremendous efforts managing through
Hurricane Michael. Their advanced preparation and joint planning
with our customers has been critical to limiting disruptions and
restoring service as expeditiously as possible in affected areas.
This was a very destructive storm in parts of Florida and
restoration efforts by our Uniti Fiber team are ongoing."
On Oct. 9, 2018, the Company closed on its previously announced
sale-leaseback and fiber acquisition with CableSouth Media, LLC. At
closing, the Company acquired approximately 43,000 fiber strand
miles located in Arkansas, Louisiana, and Mississippi, of which
34,000 fiber strand miles have been leased back to CableSouth on a
triple net basis. Uniti obtained exclusive use of 9,000 fiber
strand miles, which are adjacent to Uniti Fiber's southern network
footprint. Total consideration was $31 million.
On Sept. 19, 2018, the Company closed on the second tranche of its
previously announced sale-leaseback and fiber acquisition with U.S.
TelePacific Holdings Corp. At closing, the Company acquired 32,000
fiber strand miles located in California, which have been leased
back to TPx on a triple net basis. Total consideration for the
second tranche was $70 million.
The Company is also announcing the acquisition of JKM Consulting,
Inc. d/b/a M2 Connections, a local fiber provider in Eastern
Alabama. M2 owns approximately 200 route miles of fiber spanning
five counties. Total consideration for this transaction will be $6
million. The acquisition is expected to close in the first quarter
of 2019 and is subject to customary closing conditions.
Liquidity and Financing Transactions
At quarter-end, the Company had approximately $118.5 million of
unrestricted cash and cash equivalents, and $210 million of undrawn
borrowing availability under its revolving credit agreement. The
Company's leverage ratio at quarter end was 6.0x based on Net Debt
to Annualized Adjusted EBITDA.
During the quarter, the Company issued an aggregate of 3.2 million
shares of common stock under its "at-the-market" equity offering
program at prices ranging from $20.14 to $21.04 per share. Net
proceeds were principally used to manage leverage levels by
reducing borrowings under our revolving credit facility.
As previously reported, on Oct. 31, 2018, the Company's Board of
Directors declared a quarterly cash dividend of $0.60 per common
share, payable on Jan. 15, 2018 to stockholders of record on
Dec. 31, 2018.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/GrFPbe
About Uniti Group
Little Rock, Arkansas-based Uniti -- http://www.uniti.com/-- is an
internally managed real estate investment trust engaged in the
acquisition and construction of mission critical communications
infrastructure, and is a provider of wireless infrastructure
solutions for the communications industry. The Company is
principally focused on acquiring and constructing fiber optic
broadband networks, wireless communications towers, copper and
coaxial broadband networks and data centers. As of Sept. 30, 2018,
Uniti owns 5.4 million fiber strand miles, approximately 850
wireless towers, and other communications real estate throughout
the United States and Latin America.
Uniti reported a net loss attributable to common shareholders of
$16.55 million for the year ended Dec. 31, 2017, compared to a net
loss attributable to common shareholders of $5.49 million for the
year ended Dec. 31, 2016. As of June 30, 2018, Uniti Group had
$4.47 billion in total assets, $5.76 billion in total liabilities,
$85.01 million in convertible preferred stock, and a total
shareholders' deficit of $1.37 billion.
* * *
As reported by the TCR on Aug. 13, 2018, S&P Global Ratings lowered
its issuer credit rating on Little Rock, Ark.-based Uniti Group
Inc. to 'CCC+' from 'B-'. The lower rating follows the downgrade
of Uniti's principal leasing tenant, Windstream, which accounts for
a majority of Uniti's revenue and cash flow.
In June 2018, Moody's Investors Service downgraded Uniti Group
Inc.'s corporate family rating (CFR) to Caa1 from B3 following the
downgrade of Windstream Services, LLC. Moody's said Uniti's Caa1
CFR primarily reflects its reliance upon Windstream (Caa1 negative)
for approximately 70% of pro forma revenue.
UNIVISION COMMUNICATION: Bank Debt Trades at 3% Off
---------------------------------------------------
Participations in a syndicated loan under which Univision
Communications Inc. is a borrower traded in the secondary market at
96.80 cents-on-the-dollar during the week ended Friday, October 26,
2018, according to data compiled by LSTA/Thomson Reuters MTM
Pricing. This represents a decrease of 0.63 percentage points from
the previous week. Univision Communications pays 275 basis points
above LIBOR to borrow under the $44 million facility. The bank loan
matures on March 15, 2024. Moody's rates the loan 'B2' and Standard
& Poor's gave a 'BB-' rating to the loan. 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
Friday, October 26.
US RENAL: Bank Debt Trades at 2% Off
------------------------------------
Participations in a syndicated loan under which US Renal Care
Incorporated is a borrower traded in the secondary market at 97.58
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.75 percentage points from the
previous week. US Renal pays 425 basis points above LIBOR to borrow
under the $17 million facility. The bank loan matures on November
17, 2022. Moody's rates the loan 'B2' and Standard & Poor's gave a
'B' rating to the loan. 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 Friday, October 26.
VERITAS SOFTWARE: Bank Debt Trades at 4% Off
--------------------------------------------
Participations in a syndicated loan under which Veritas Software is
a borrower traded in the secondary market at 96.07
cents-on-the-dollar during the week ended Friday, October 26, 2018,
according to data compiled by LSTA/Thomson Reuters MTM Pricing.
This represents a decrease of 0.72 percentage points from the
previous week. Veritas Software pays 450 basis points above LIBOR
to borrow under the $19 million facility. The bank loan matures on
January 27, 2023. Moody's rates the loan 'B2' and Standard & Poor's
gave a 'B' rating to the loan. 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 Friday,
October 26.
VYAIRE MEDICAL: S&P Lowers ICR to CCC+, Outlook Negative
--------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Mettawa,
Ill.-based manufacturer and distributor of respiratory equipment
and supplies Vyaire Medical Inc. to 'CCC+' from 'B-'. The outlook
is negative.
S&P said, "At the same time, we lowered our issue-level rating on
Vyaire's secured first-lien credit facilities to 'CCC+' from 'B-'.
The '3' recovery rating remains unchanged, indicating our
expectation for meaningful recovery (50%-70%; rounded estimate:
55%) of principal in the event of a payment default.
"We also lowered our issue-level rating on the company's secured
second-lien term loan facility to 'CCC-' from 'CCC'. The '6'
recovery rating remains unchanged, indicating our expectation for
negligible recovery (0%-10%; rounded estimate: 5%) of principal in
the event of a payment default.
"The downgrade reflects our expectation that Vyaire's difficult
separation from Becton Dickinson & Co. (BD), combined with its
recent loss of a material contract, will cause the company to post
significant cash flow deficits in fiscal year 2019. We also
anticipate that, absent a materially significant positive change in
the company's performance, its capital structure may be
unsustainable over the long term given our current expectation for
continued cash flow deficits over the next several years.
"The negative outlook on Vyaire reflects our belief that the
company has very little room to underperform our expectations in
2019. Absent a materially positive change in the company's
performance, its elevated cash flow deficits could deplete its
liquidity resources sooner than we project."
W&T OFFSHORE: Files Quarterly Report on Form 10-Q
-------------------------------------------------
W&T Offshore, Inc., has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q reporting net income
of $46.26 million on $153.45 million of total revenues for the
three months ended Sept. 30, 2018, compared to a net loss of $1.29
million on $110.3 million of total revenues for the three months
ended Sept. 30, 2017.
For the nine months ended Sept. 30, 2018, the Company reported net
income of $109.98 million on $437.28 million of total revenues
compared to net income of $56.31 million on $357.99 million of
total revenues for the same period last year.
As of Sept. 30, 2018, W&T Offshore had $1.10 billion in total
assets, $446.81 million in total current liabilities, $759.12
million in long term debt, $283 million in asset retirement
obligations, $73.17 million in other liabilities, and a total
shareholders' deficit of $459.77 million.
Liquidity and Capital Resources
The Company stated that, "Our primary liquidity needs are to fund
capital expenditures and strategic property acquisitions to allow
us to replace our oil and natural gas reserves, repay outstanding
borrowings, make related interest payments and satisfy our asset
retirement obligations. We have funded such activities in the past
with cash on hand, net cash provided by operating activities, sales
of property, securities offerings and bank borrowings.
"If commodity prices were to return to the weaker levels seen in
the early part of 2016, especially relative to our cost of finding
and producing new reserves, this could have a significant adverse
effect on our liquidity. In addition, other events outside of our
control could significantly affect our liquidity such as changes in
regulations or the interpretation of existing regulations."
On Oct. 18, 2018, the Company issued $625.0 million of the Senior
Second Lien Notes at par with an interest rate of 9.75% per annum
that matures on Nov. 1, 2023. Concurrently with the issuance of
the Senior Second Lien Notes, the Company entered into the New
Revolving Credit Agreement which provides a revolving bank credit
facility and letter of credit facility with an increased initial
borrowing base of $250.0 million and matures on Oct. 18, 2022. The
proceeds from the issuance of the Senior Second Lien Notes, cash on
hand and borrowings under the New Revolving Credit Agreement were
used to repurchase and retire, repay or irrevocably redeem all of
its existing notes and term loans outstanding and fund debt
issuance costs.
Subsequent to the issuance of the Senior Second Lien Notes and
repayment of the existing notes and loans outstanding, the Company
had $61.0 outstanding borrowings under the New Revolving Credit
Agreement, $9.7 million of letters of credit outstanding and $179.3
million availability. The Company will be subject to the normal
re-determination of its borrowing base in the spring of 2019. Any
redetermination by its lenders to change its borrowing base will
result in a similar change in the availability under its New
Revolving Credit Agreement. The New Revolving Credit Agreement's
security is collateralized by substantially all of the Company's
oil and natural gas properties and certain personal property. The
New Revolving Credit Agreement contains financial covenants
calculated as of the last day of each fiscal quarter, which include
thresholds on financial ratios, as defined in the New Revolving
Credit Agreement. The Company was in compliance with all
applicable covenants of the Prior Credit Agreement and other
long-term debt instruments as of Sept. 30, 2018 and after the 2018
Refinancing Transaction under the New Revolving Credit Agreement
and the Senior Second Lien Notes.
"We believe we will have adequate available liquidity to fund our
operations through November 2019, the period of assessment to
qualify as a going concern. However, we cannot predict the
potential changes in commodity prices or future Bureau of Ocean
Energy Management ("BOEM") bonding requirements, either of which
could affect our operations, liquidity levels and compliance with
debt covenants," the Company said.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/nSx7mw
About W&T Offshore
Based in Houston, Texas, W&T Offshore, Inc. --
http://www.wtoffshore.com/-- is an independent oil and natural gas
producer with operations offshore in the Gulf of Mexico and has
grown through acquisitions, exploration and development. The
Company currently has working interests in 48 producing fields in
federal and state waters and has under lease approximately 650,000
gross acres, including approximately 440,000 gross acres on the
Gulf of Mexico Shelf and approximately 210,000 gross acres in the
deepwater. A majority of the company's daily production is derived
from wells it operates.
W&T Offshore reported net income of $79.68 million in 2017 compared
to a net loss of $249.02 million in 2016.
As reported by the TCR on Oct. 4, 2018, S&P Global Ratings raised
its issuer credit rating on Houston-based oil and gas exploration
and production company W&T Offshore Inc. to 'B-' from 'CCC'. The
outlook is stable. The upgrade reflects S&P's view that W&T's
proposed capital restructuring will significantly improve its
liquidity and leverage.
* * *
This concludes the Troubled Company Reporter's coverage of W&T
Offshore until facts and circumstances, if any, emerge that
demonstrate financial or operational strain or difficulty at a
level sufficient to warrant renewed coverage.
W&T OFFSHORE: Posts Third Quarter Net Income of $46.3 Million
-------------------------------------------------------------
W&T Offshore, Inc., reported its third quarter 2018 operational and
financial results, fourth quarter and full year 2018 production and
expense guidance. Some of the key highlights included:
* On Oct. 18, 2018, W&T closed on a major debt refinancing,
which reduced total debt principal outstanding from $903
million to $625 million plus $61 million drawn on a revolving
bank credit facility, simplified the capital structure, and
extended the maturities of its revolving bank credit facility
and high yield debt to 2022 and 2023, respectively, while
maintaining strong liquidity in excess of $200 million.
* Net income for the third quarter of 2018 was $46.3 million,
or $0.32 per share compared to a net loss of $1.3 million or
$0.01 loss per share in the third quarter of 2017. Net
income for the third quarter of 2018 included $0.1 million of
income tax expense compared to $5.5 million for the third
quarter of 2017. Excluding special items, adjusted net
income for the third quarter of 2018 was $44.1 million and
earnings were $0.30 per share.
* Revenues for the third quarter of 2018 were $153.5 million,
up $43.2 million, or 39% compared to the third quarter of
2017. Oil and natural gas liquids sales made up 84% of
revenues, compared to 77% in the third quarter of 2017. The
Company's realized crude oil price was $69.57 per barrel, up
52% from the third quarter 2017.
* Operating income for the third quarter of 2018 was $ 57.1
million, an increase of 264% or $41.4 million, over the third
quarter of 2017.
* Production for the third quarter of 2018 averaged 36,508
barrels of oil equivalent per day (or 3.4 million Boe for the
quarter), 61% of which was oil and NGLs. Production was flat
with the third quarter of 2017 on lower capital expenditures.
* Cash flow from operating activities for the first nine months
of 2018 was $294.9 million, increasing over 126% from the
first nine months of 2017.
* Adjusted EBITDA for the third quarter of 2018 was $92.2
million, up $35.0 million, or 61% compared to the third
quarter of 2017. The Company's Adjusted EBITDA margin was
60% for the third quarter of 2018, up from 52% in third
quarter of 2017. For the first nine months of 2018, its
Adjusted EBITDA was $262.7 million, up $67.1 million or 34%
over the same period in 2017.
* On Sept. 28, 2018, W&T closed on the sale of non-core
overriding royalty interests in the Permian Basin for net
proceeds received to date of $50.5 million.
* Since the end of the second quarter of 2018, W&T participated
in the drilling of three successful wells.
Tracy W. Krohn, W&T Offshore's Chairman and chief executive
officer, stated, "We are very pleased to have completely refinanced
our debt, which included the successful and over-subscribed
issuance of $625 million of new 9.75% senior second lien notes due
November 2023 and a newly established revolving bank credit
facility with a borrowing base of $250 million. We dramatically
simplified our debt structure and reduced total debt principal
outstanding from $903 million to $625 million plus $61 million
currently drawn on the revolving bank credit facility. Our current
liquidity is over $200 million, and with continued strong positive
cash flow, we anticipate exiting 2018 with a much-improved balance
sheet and the financial strength to pursue meaningful growth
opportunities. W&T has a long history of completing acquisitions
of producing assets in the Gulf of Mexico with upside potential and
a demonstrated track record for significantly enhancing the value
of those assets while boosting cash flow. We believe that market
conditions in the Gulf are currently favorable for acquisitions and
with our improved financial liquidity, we are very well positioned
to benefit."
"Our continued drilling success and ability to put new projects
online quickly in a positive commodity price environment has
allowed us to significantly increase our cash flow. Since the end
of the second quarter we drilled three more successful wells that
are adding reserves and production. At the Mahogany field, our
newly drilled A-19 well found high quality net pay in multiple
sands. The first completion in the A-19 well will be in the 'T'
sand. The 'T' sand was found up-dip from known oil which we
believe further demonstrates that Mahogany is a world class asset.
Additionally, we drilled another successful well at the Ewing Bank
910 field with an exploration discovery that also exceeded our
pre-drill estimates. The ST 320 A-2 exploratory well logged
approximately 163 vertical feet of pay sands. Both of these wells
are currently being completed and are expected to be on production
before year-end 2018. We will then continue our drilling programs
in both of these fields. At our Virgo field we drilled the A-12
well, which found 60 feet of net vertical pay sands is in final
stage of completion activity and is expected to be on production in
November. The Virgo field rig is now drilling the A-13 well, which
assuming success, would add production in early 2019. The A-12 and
A-13 wells are part of the Monza Drilling Joint Venture," concluded
Mr. Krohn.
Production for the third quarter of 2018 was 3.4 million Boe, flat
with the third quarter of 2017. Third quarter 2018 production was
comprised of 1.7 million barrels of oil, 0.3 million barrels of
NGLs and 7.9 billion cubic feet ("Bcf") of natural gas. Oil and
NGLs production comprised 61% of total production in the third
quarter of 2018 compared to 60% of total production in the third
quarter of 2017.
Production for the third quarter of 2018 exceeded the mid-point of
the production guidance and was partially driven by less storm
outage than was projected for the period.
Production increases over the prior year period primarily came from
the Company's newly acquired 9.375% non-operated working interest
in the Heidelberg field and our Ship Shoal 300 field (with the
completion of the SS 300 B-5ST in November 2017). These gains were
offset by production decreases primarily due to natural production
declines.
For the third quarter of 2018, the Company's realized crude oil
sales price was $69.57 per barrel (a 52% increase over the third
quarter of 2017), its realized NGL sales price was $31.70 per
barrel and its realized natural gas sales price was $2.85 per Mcf.
The Company's combined average realized sales price was $45.32 per
Boe, which represents a 40% increase over the $32.43 per Boe sales
price that the Company realized in the third quarter of 2017.
Revenues for the third quarter of 2018 increased 39% to $153.5
million compared to $110.3 million in the third quarter of 2017 as
a result of the 40% increase in its realized commodity sales price
per Boe.
Lease operating expense, which includes base lease operating
expenses, insurance premiums, workovers and facilities maintenance,
was $37.4 million in the third quarter of 2018 compared to $35.1
million in the third quarter of 2017. The increase was primarily
due to higher workover expenses. On a component basis, base lease
operating expenses were $29.6 million, insurance premiums were $3.1
million, workovers were $1.2 million and facilities maintenance was
$3.5 million. Facilities maintenance tends to be seasonal and is
typically lower during the winter months.
Depreciation, depletion, amortization and accretion, including
accretion for asset retirement obligations, was $11.01 per Boe of
production for the third quarter of 2018 compared to $10.88 per Boe
for the third quarter of 2017.
General and Administrative Expenses was $16.0 million for the third
quarter of 2018, an increase of 2% compared to $15.6 million in the
third quarter of 2017. The increase was primarily due to an
accrual for an executive's separation settlement, an increase in
medical claims and the termination of an office lease.
In the third quarter of 2018, the Company recorded a net gain of
$0.3 million on its outstanding crude oil commodity derivative
contracts. This compared to a net loss of $2.9 million in the
third quarter of 2017 on the derivative contracts that expired at
the end of 2017. A list of the Company's derivative positions may
be found on its website at www.wtoffshore.com in the investor
relations section under "other reports" tab.
Income tax expense was $0.1 million in the third quarter of 2018
compared to income tax expense of $5.5 million in the third quarter
of 2017. The Company is not forecasting any current income tax
expense and its deferred expense is fully offset by a valuation
allowance. Consequently, the Company's effective tax rate is not
meaningful. The balance sheet at Sept. 30, 2018, reflects current
income tax receivables of $65.2 million, which relates to the
Company's net operating loss claims for plug and abandonment work
that qualifies as specified liability losses for tax purposes,
allowing net operating losses to be carried back to prior years.
The Company's net income for the third quarter of 2018 was $46.3
million, or $0.32 per common share. Excluding special items, the
Company's adjusted net income was $44.1 million, or $0.30 per
share. For the third quarter of 2017, its net loss was $1.3
million, or $0.01 loss per share; excluding special items, adjusted
net income for the third quarter of 2017 was $6.0 million, or $0.04
per share.
Net cash provided by operating activities for the nine months ended
Sept. 30, 2018 was $294.9 million, an increase of 126% compared to
$130.3 million for the nine months ended Sept. 30, 2017. The
increase is primarily due to higher realized prices for crude oil
and NGLs, lower spending on plug and abandonment activities and
$27.0 million in cash advance from joint venture partners.
Adjusted EBITDA for the third quarter of 2018 was $92.2 million and
Adjusted EBITDA margin was 60%, compared to Adjusted EBITDA of
$57.2 million and Adjusted EBITDA margin of 52% for the third
quarter of 2017.
On Oct. 18, 2018, the Company closed on a major debt refinancing,
which reduced total debt principal outstanding from $903 million to
$625 million, simplified the capital structure and extended the
maturities of the Company's revolving credit facility and high
yield debt to 2022 and 2023, respectively, while maintaining strong
liquidity.
The Company issued $625 million of new 9.75% senior second lien
notes due November 2023. The net proceeds from the issuance, along
with cash on hand and borrowings on the revolving credit facility
are being used to retire all of the Company's previously
outstanding notes.
Concurrently, the Company entered into a Sixth Amended and Restated
Credit Agreement which provides for a revolving credit and letter
of credit facility with an initial borrowing base of $250 million.
The revolving credit facility will mature on
Oct. 18, 2022. Currently, the Company has $61 million borrowings
on the revolving bank credit facility and $9.7 million of letters
of credit outstanding.
Total liquidity on Oct. 18, 2018 was $220.1 million, consisting of
an unrestricted cash balance of $40.8 million and $179.3 million of
availability under its revolving bank credit facility.
As of Sept. 30, 2018, W&T had $1.10 billion in total assets,
$446.81 million in total current liabilities, $759.12 million in
long-term debt, $283 million in asset retirement obligations,
$73.17 million in other liabilities, and a total shareholders'
deficit of $459.77 million.
The Company's capital expenditures for oil and gas properties on an
accrual basis for the nine months of 2018 were $59.2 million,
compared to $79.1 million for the 2017 period. In addition, the
Company acquired a 9.375% interest in the Heidelberg field for
$16.8 million. The 2018 period reflects a net reimbursement from
Monza Energy LLC of approximately $20 million for W&T's costs
associated with wells drilled or were being drilled prior to the
partial interests being contributed by W&T to Monza. During the
nine months ended Sept. 30, 2018, the Company completed the SS 359
A-17 well, drilled and completed the SS 359 A-5 ST well, and
drilled the SS 359 A-19 well at Mahogany field; drilled and
completed the A-10 ST well and the A-12 well at Viosca Knoll 823;
and drilled the ST 320 A-2 well at Ewing Bank 910 field. At
Sept. 30, 2018 there were two wells being completed and one well
being drilled.
OPERATIONS UPDATE
The Company is currently operating or participating in three active
drilling programs in the Gulf of Mexico.
Ship Shoal 349 "Mahogany" (operated, shelf, 100% working interest):
The SS 359 A-19 well was drilled to total depth and found high
quality net pay in multiple field pay sands with better than
expected reservoir characteristics. Currently, the well is being
completed and should be on production before year-end 2018.
Following the A-19 well completion, the platform rig will drill the
A-20 development well targeting the T-Sand.
Ewing Bank 910 Field Area (non-operated wells, deepwater, in JV
Drilling Program): The ST 320 A-2 exploratory well was successfully
drilled from the South Timbalier 311 platform that is part of the
Ewing Bank 910 field. The well logged approximately 163 vertical
feet of net pay, which also exceeded pre-drill estimates, and is
currently being completed. The Company expects to have the well on
production via existing infrastructure before year-end 2018. W&T
has a 10.8% interest in the ST 320 A-2 well before certain
thresholds are met.
Following the completion of the ST 320 A-2 well, the rig will spud
the ST 320 A-3 well, another low-risk exploration opportunity in
the Ewing Bank 910 field. The Company believes stratigraphic
information from a high quality thick Miocene sand that was
penetrated in another offset well has reduced the risk on the ST
320 A-3 prospect. W&T has a 10.8% interest in the ST 320 A-3 well
before certain thresholds are met.
Viosca Knoll 823 "Virgo" (operated, shelf, in JV Drilling Program):
The Virgo field platform rig drilled and completed the A-12 well in
block VK 779, which is currently on flow-back. The well found 60
feet of net vertical pay. The rig has commenced drilling the A-13
well, which is expected to reach total depth in November or
December of 2018 with production expected to commence by year-end
2018 or early 2019. W&T has a 16% interest in the A-12 and a 23.9%
interest in the A-13 well before certain thresholds are met.
During the third quarter of 2018 the Company performed four
recompletions that added approximately 1,673 Boe per day of initial
production and six workovers that added approximately 265 Boe per
day of initial production.
A full-text copy of the press release is available for free at:
https://is.gd/TGGHGM
About W&T Offshore
Based in Houston, Texas, W&T Offshore, Inc. --
http://www.wtoffshore.com/-- is an independent oil and natural gas
producer with operations offshore in the Gulf of Mexico and has
grown through acquisitions, exploration and development. The
Company currently has working interests in 48 producing fields in
federal and state waters and has under lease approximately 650,000
gross acres, including approximately 440,000 gross acres on the
Gulf of Mexico Shelf and approximately 210,000 gross acres in the
deepwater. A majority of the company's daily production is derived
from wells it operates.
W&T Offshore reported net income of $79.68 million in 2017 compared
to a net loss of $249.02 million in 2016. As of June 30, 2018, W&T
Offshore had $958.15 million in total assets, $342.3 million in
total current liabilities, $760.97 million in long term debt,
$289.3 million in asset retirement obligations, $73 million in
other liabilities and a total shareholders' deficit of $507.4
million.
* * *
As reported by the TCR on Oct. 4, 2018, S&P Global Ratings raised
its issuer credit rating on Houston-based oil and gas exploration
and production company W&T Offshore Inc. to 'B-' from 'CCC'. The
outlook is stable. The upgrade reflects S&P's view that W&T's
proposed capital restructuring will significantly improve its
liquidity and leverage.
WEATHERFORD INTERNATIONAL: Posts $199 Million 3rd Quarter Net Loss
------------------------------------------------------------------
Weatherford International public limited company has filed with the
Securities and Exchange Commission its Quarterly Report on Form
10-Q reporting a net loss attributable to the Company of $199
million on $1.44 billion of total revenues for the three months
ended Sept. 30, 2018, compared to a net loss attributable to the
Company of $256 million on $1.46 billion of total revenues for the
three months ended Sept. 30, 2017.
For the nine months ended Sept. 30, 2018, the Company reported a
net loss attributable to the Company of $708 million on $4.31
billion of total revenues compared to a net loss attributable to
the Company of $875 million on $4.20 billion of total revenues for
the same period last year.
As of Sept. 30, 2018, Weatherford had $8.83 billion in total
assets, $10.34 billion in total liabilities and a total
shareholders' deficiency of $1.50 billion.
At Sept. 30, 2018, the Company had cash and cash equivalents of
$393 million compared to $613 million at Dec. 31, 2017.
In the first nine months of 2018, cash used in operating activities
was $347 million compared to cash used of $484 million in the first
nine months of 2017. Cash used in operating activities in 2018 was
driven by working capital needs, cash payments for debt interest
and cash severance and restructuring costs.
The Company's cash used in investing activities was $41 million
during the first nine months of 2018 compared to cash used of $401
million in the first nine months of 2017. In the first nine months
of 2018, the primary drivers of investing activities were capital
expenditures of $141 million for property, plant and equipment and
assets held for sale, which was partially offset by net proceeds
from dispositions of assets and businesses and equity investments
of $107 million.
In February 2018, the Company issued $600 million in aggregate
principal amount of its 9.875% senior notes due 2025 for net
proceeds of $586 million. The Company used part of the proceeds
from its debt offering to repay in full its 6.00% senior notes due
March 2018 and to fund a concurrent tender offer to purchase all of
its 9.625% senior notes due 2019.
"Due to the highly competitive nature of our business and the
continuing losses we incurred over the last few years, we continue
to reduce our overall cost structure and workforce to better align
our business with current activity levels," the Company said. "The
ongoing cost reduction plan, which began in 2018 and is expected to
continue through 2019... included a workforce reduction,
organizational restructure, facility consolidations and other cost
reduction measures and efficiency initiatives across our geographic
regions."
In connection with the Transformation Plan, the Company recognized
restructuring and transformation charges of $27 million and $90
million in the third quarter and the first nine months of 2018,
respectively, which include termination (severance) charges of $6
million and $46 million, respectively, and other restructuring
charges of $21 million and $44 million, respectively. Other
restructuring charges include contract termination costs,
relocation and other associated costs.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/YCyFhe
About Weatherford
Weatherford (NYSE: WFT), an Irish public limited company and Swiss
tax resident -- http://www.weatherford.com/-- is a multinational
oilfield service company providing innovative solutions, technology
and services to the oil and gas industry. The Company operates in
over 90 countries and has a network of approximately 710 locations,
including manufacturing, service, research and development and
training facilities and employs approximately 28,450 people.
Weatherford reported a net loss attributable to the Company of
$2.81 billion in 2017, a net loss attributable to the Company of
$3.39 billion in 2016, and a net loss attributable to the Company
of $1.98 billion in 2015. As of June 30, 2018, Weatherford had
$8.97 billion in total assets, $10.29 billion in total liabilities
and a shareholders' deficiency of $1.31 billion.
WEDDINGWIRE INC: S&P Assigns B Issuer Credit Rating, Outlook Stable
-------------------------------------------------------------------
S&P Global Ratings assigned its 'B' issuer credit rating to
WeddingWire, Inc. The outlook is stable.
S&P said, "At the same time, we assigned our 'B+' issue-level
rating to the company's proposed $25 million revolving credit
facility due 2023 and $450 million first-lien term loan due 2025.
The recovery rating on the first-lien debt is '2', indicating our
expectation of substantial (70%-90%; rounded estimate: 80%)
recovery prospects in the event of a payment default.
"We also assigned our 'CCC+' issue-level rating to the company's
proposed $175 million second-lien term loan due 2026. The recovery
rating is '6', indicating our expectation of negligible (0%-10%;
rounded estimate: 5%) recovery in the event of a payment default.
"Our ratings on Wedding Wire reflect our expectation that the
acquisition of XO Group will be executed with limited disruption
and the majority of synergies (largely headcount-related) will be
realized over the 12 months following acquisition close (first half
of 2019). Though credit metrics will remain highly leveraged, we
believe that acquisition and cost synergy-based EBITDA expansion
will allow debt to EBITDA to improve from the high-11x area (pro
forma) to about 5x in 2020, the first full year reflective of
consolidated operations. Over the same time, we expect free
operating cash flow to improve to at least $60 million, from
negative levels at acquisition close. While we believe the company
will be able to reduce the mostly headcount-related redundancies,
acquisition-related expenses and costs to achieve synergies will
delay the realization of any benefits within the first 12 months.
As such, we look to our forecasted 2020 projections as being most
representative of the combined entity's performance.
"The stable outlook reflects our expectation that WeddingWire will
be able to integrate the acquisition of the XO Group with limited
vendor attrition or disruption to its operations. We expect the
company to substantially execute its synergy plan, which consists
mostly of headcount reductions, resulting in a material improvement
in its earnings profile and S&P Global Ratings' adjusted debt
leverage in the high-4x area in 2020, the first full year following
the acquisition close.
"We could lower the rating if the company does not appear on track
to realize previously identified productivity improvements or if
poor execution of the integration leads to issues such as customer
attrition. This could result in a reduced paying subscriber base
and a material decline in operating performance such that S&P
adjusted debt to EBITDA would remain above 7.0x by mid-2020. We
could also lower our ratings if the company's financial sponsor
engages in an aggressive financial policy including debt-financed
dividends or acquisitions, resulting in the company no longer being
on track to meet S&P Global Ratings' adjusted debt to EBITDA
trigger.
"Although highly unlikely over the next year, we could raise our
ratings if the company were to apply excess cash flow toward debt
reduction such that S&P Global Ratings' adjusted leverage declines
to and remains below 5x. An upgrade would also be contingent upon
our belief that the financial sponsor would maintain conservatism
in its financial policy allowing the company to maintain leverage
at these levels with minimal risk of re-leveraging. We could also
raise our ratings if the company were to build scale, improve
diversity and barriers to entry to an extent material enough to
result in an improved business risk profile."
WELBILT INC: S&P Affirms BB- Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'BB-' issuer credit rating on New
Port Richey, Fla.-based Welbilt Inc. The outlook is stable. S&P
said, "We removed our issuer credit rating and the issue-level
rating on the company's senior unsecured notes due 2024 from
CreditWatch, where we had placed them with negative implications on
Oct. 4, 2018."
S&P said, "At the same time, we affirmed our 'BB-' issue-level
rating, with a '3' recovery rating, on the company's $400 million
revolver due 2023 and $900 million term loan B due 2025. The '3'
recovery rating indicates our expectation for meaningful recovery
(50-70%; rounded estimate: 50%) in the event of payment default.
"We also lowered our issue-level rating on the company's senior
unsecured notes due 2024 to 'B' from 'B+' and revised the
recovery-rating on the notes to '6' from '5'. The recently
completed amendment resulted in an increase in senior secured
facilities (including a larger revolver) that would have priority
over the unsecured notes in a simulated default scenario, worsening
recovery prospects. The '6' recovery rating indicates our
expectation for negligible recovery (0%-10%; rounded estimate 5%)
in the event of payment default.
"The rating affirmation and stable outlook reflect the improvement
in covenant cushion following the recent amendment to the company's
senior secured credit facility. We now forecast that the company
will maintain cushion under its total leverage and interest
coverage covenants of greater than 15% over the next 12 months. The
revised covenant levels provide the company with additional
flexibility to draw on its revolving credit facility if it needs
additional liquidity for both organic and inorganic growth
opportunities. The covenant revisions also resolve our previous
concerns about the company's ability to comply with its total
leverage covenant in the near term.
"The stable outlook reflects our expectation that Welbilt will
continue to gradually reduce leverage to the high-4x area over the
next 12-18 months from the full-year benefit of the Crem
acquisition, as well as increased volumes. We expect EBITDA margins
to remain relatively steady in the 19%-20% range as the company
passes along increased raw material costs and freight costs to
customers.
"We could lower our ratings on Welbilt if a significant decline in
global foodservice demand or increasing raw materials cost caused
operating performance to weaken to the point that leverage
increased meaningfully above 5x on a sustained basis. We could also
lower the rating if the company pursues significant acquisitions
beyond what we currently expect or shareholder returns that result
in leverage sustained above 5x, or if the company's headroom under
its leverage or interest coverage covenant declined below 15%.
"We could raise our ratings on Welbilt if we expect the company to
maintain leverage below 4x. We would also expect the company to
adhere to a financial policy, including decisions around potential
future acquisitions and shareholder returns, that supports its
improved credit measures. We would also have to expect the
company's headroom under its leverage and interest coverage
covenant would be at or above 15% on a sustained basis."
WEST VIRGINIA UNIVERSITY: Moody's Affirms B1 on Revenue Bonds
-------------------------------------------------------------
Moody's Investors Service has affirmed the B1 on West Virginia
State University's B1 series 2012A and series 2013A refunding
revenue bonds. The outlook remains negative. The rating action
affects about $10 million of debt.
RATINGS RATIONALE
The B1 reflects West Virginia State University's pressured
financial position, with very narrow liquidity and thin operating
performance. While management is taking measures to trim expenses,
the university continues to grapple with weak net tuition revenue
and state funding challenges. Prospects for generating material net
tuition revenue growth are low given ongoing enrollment pressures
resulting from a combination of factors. The university has a poor
retention rate and draws the majority of its students from West
Virginia (Aa2 stable), which has declining numbers of high school
graduates and low college going rates. These factors, along with a
small operating scale, will continue to pressure revenues and make
sustaining favorable operations challenging. Additionally,
inclusive of debt issued by the foundation for housing, leverage is
comparatively high and debt affordability is weak.
Favorably, WVSU continues to serve an important role in the state
as a historically black, land grant university. A low-cost public
university in the Charleston metropolitan area, WVSU serves over
3,000 full-time equivalent students, mostly from West Virginia,
many of whom are price sensitive. Like other West Virginia public
universities, WVSU benefits from solid oversight from the West
Virginia Higher Education Policy Commission (HEPC; Aa3 stable).
RATING OUTLOOK
The negative outlook acknowledges the risks associated with an
extremely thin unrestricted liquidity, which provides limited
avenues to address unforeseen liquidity needs. It also reflects its
expectations of continued depressed revenues.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Material improvement in liquidity driven by significant
strengthening in cash flow
- Meaningful strengthening in student demand
- Sustained increases in state funding
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Inability to maintain debt service coverage above 1x
- Failure to stabilize and improve liquidity
- Lack of continuity in executive leadership
- Continued reductions in state financial support
LEGAL SECURITY
The 2012A and 2013A revenue bonds are secured by a limited pledge
which includes auxiliary capital fees and gross operating revenues
of designated auxiliary facilities. In fiscal 2017, net pledged
revenues totaled $1.1 million which covered debt service 1.6 times.
There is a sum sufficient rate covenant.
USE OF PROCEEDS
Not applicable.
PROFILE
Established by the Morrill Act of 1890, WVSU is a public,
historically black, land-grant university located just outside of
Charleston, West Virginia. The university serves a diverse
population of students and offers a broad menu of undergraduate,
graduate, certificate, and online programs. The university enrolled
3,082 full-time equivalent students in fall 2017 and had fiscal
2017 operating revenues totaling $42 million.
METHODOLOGY
The principal methodology used in these ratings was Higher
Education published in December 2017.
[^] BOND PRICING: For the Week from October 29 to November 2
------------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
Acosta Inc ACOSTA 7.750 33.767 10/1/2022
Acosta Inc ACOSTA 7.750 34.280 10/1/2022
Alpha Appalachia
Holdings LLC ANR 3.250 2.048 8/1/2015
American Tire
Distributors Inc ATD 10.250 18.000 3/1/2022
American Tire
Distributors Inc ATD 10.250 25.500 3/1/2022
Appvion Inc APPPAP 9.000 1.125 6/1/2020
Appvion Inc APPPAP 9.000 1.387 6/1/2020
BPZ Resources Inc BPZR 6.500 3.017 3/1/2015
BPZ Resources Inc BPZR 6.500 3.017 3/1/2049
Bon-Ton Department
Stores Inc/The BONT 8.000 7.000 6/15/2021
Cenveo Corp CVO 6.000 26.154 8/1/2019
Cenveo Corp CVO 8.500 1.127 9/15/2022
Cenveo Corp CVO 6.000 1.258 5/15/2024
Cenveo Corp CVO 6.000 26.154 8/1/2019
Cenveo Corp CVO 8.500 1.127 9/15/2022
Chukchansi Economic
Development Authority CHUKCH 9.750 64.585 5/30/2020
Chukchansi Economic
Development Authority CHUKCH 10.250 64.625 5/30/2020
Community Choice
Financial Inc CCFI 10.750 70.720 5/1/2019
Community Choice
Financial Inc CCFI 12.750 68.500 5/1/2020
Community Choice
Financial Inc CCFI 12.750 68.500 5/1/2020
DBP Holding Corp DBPHLD 7.750 43.714 10/15/2020
DBP Holding Corp DBPHLD 7.750 43.714 10/15/2020
EXCO Resources Inc XCOO 8.500 19.407 4/15/2022
Egalet Corp EGLT 5.500 10.375 4/1/2020
Emergent Capital Inc EMGC 8.500 85.792 2/15/2019
Endologix Inc ELGX 2.250 97.000 12/15/2018
Energy Conversion
Devices Inc ENER 3.000 7.875 6/15/2013
Energy Future Intermediate
Holding Co LLC /
EFIH Finance Inc TXU 9.750 37.625 10/15/2019
Federal Home Loan Banks FHLB 1.500 99.901 11/6/2018
Federal Home Loan Banks FHLB 1.050 99.403 11/8/2018
Fleetwood Enterprises Inc FLTW 14.000 3.557 12/15/2011
Homer City Generation LP HOMCTY 8.137 38.750 10/1/2019
Lehman Brothers Holdings Inc LEH 1.600 3.326 11/5/2011
Lehman Brothers Holdings Inc LEH 4.000 3.326 4/30/2009
Lehman Brothers Holdings Inc LEH 2.000 3.326 3/3/2009
Lehman Brothers Holdings Inc LEH 1.500 3.326 3/29/2013
Lehman Brothers Holdings Inc LEH 2.070 3.326 6/15/2009
Lehman Brothers Holdings Inc LEH 1.383 3.326 6/15/2009
Lehman Brothers Holdings Inc LEH 5.000 3.326 2/7/2009
Lehman Brothers Inc LEH 7.500 1.226 8/1/2026
MModal Inc MODL 10.750 6.125 8/15/2020
Mashantucket Western
Pequot Tribe MASHTU 7.350 16.000 7/1/2026
Midstates Petroleum
Co Inc / Midstates
Petroleum Co LLC MPO 10.750 0.900 10/1/2020
OMX Timber Finance
Investments II LLC OMX 5.540 4.058 1/29/2020
Orexigen Therapeutics Inc OREXQ 2.750 5.125 12/1/2020
Orexigen Therapeutics Inc OREXQ 2.750 5.125 12/1/2020
PHI Inc PHII 5.250 87.551 3/15/2019
PaperWorks Industries Inc PAPWRK 9.500 53.860 8/15/2019
PaperWorks Industries Inc PAPWRK 9.500 53.860 8/15/2019
Pernix Therapeutics
Holdings Inc PTX 4.250 43.759 4/1/2021
Pernix Therapeutics
Holdings Inc PTX 4.250 43.759 4/1/2021
PetroQuest Energy Inc PQUE 10.000 43.000 2/15/2021
PetroQuest Energy Inc PQUE 10.000 40.875 2/15/2021
PetroQuest Energy Inc PQUE 10.000 40.875 2/15/2021
Powerwave Technologies Inc PWAV 2.750 0.155 7/15/2041
Powerwave Technologies Inc PWAV 3.875 0.155 10/1/2027
Powerwave Technologies Inc PWAV 1.875 0.155 11/15/2024
Powerwave Technologies Inc PWAV 1.875 0.155 11/15/2024
Powerwave Technologies Inc PWAV 3.875 0.155 10/1/2027
Prospect Capital Corp PSEC 4.750 98.711 11/15/2020
Prospect Capital Corp PSEC 5.500 99.239 11/15/2020
Prospect Capital Corp PSEC 5.000 98.959 11/15/2020
Prospect Capital Corp PSEC 4.750 98.717 11/15/2020
Prospect Capital Corp PSEC 5.125 98.939 11/15/2020
Renco Metals Inc RENCO 11.500 29.000 7/1/2003
Rex Energy Corp REXX 8.000 27.800 10/1/2020
Rex Energy Corp REXX 8.875 17.204 12/1/2020
Rex Energy Corp REXX 6.250 15.625 8/1/2022
Rex Energy Corp REXX 8.000 26.351 10/1/2020
Rolta LLC RLTAIN 10.750 12.583 5/16/2018
Sanchez Energy Corp SN 7.750 49.097 6/15/2021
SandRidge Energy Inc SD 7.500 0.696 2/15/2023
Sears Holdings Corp SHLD 8.000 11.500 12/15/2019
Sempra Texas Holdings Corp TXU 5.550 12.066 11/15/2014
SiTV LLC / SiTV Finance Inc NUVOTV 10.375 50.250 7/1/2019
SiTV LLC / SiTV Finance Inc NUVOTV 10.375 52.181 7/1/2019
TRU Taj LLC / TRU Taj
Finance Inc TOY 12.000 55.000 8/15/2021
TRU Taj LLC / TRU Taj
Finance Inc TOY 12.000 60.500 8/15/2021
TerraVia Holdings Inc TVIA 5.000 4.644 10/1/2019
TerraVia Holdings Inc TVIA 6.000 4.644 2/1/2018
Toys R Us - Delaware Inc TOY 8.750 3.292 9/1/2021
Toys R Us Inc TOY 7.375 5.250 10/15/2018
Transworld Systems Inc TSIACQ 9.500 50.040 8/15/2021
Transworld Systems Inc TSIACQ 9.500 25.875 8/15/2021
Walter Energy Inc WLTG 8.500 0.834 4/15/2021
Walter Energy Inc WLTG 9.875 0.834 12/15/2020
Walter Energy Inc WLTG 9.875 0.834 12/15/2020
Walter Energy Inc WLTG 9.875 0.834 12/15/2020
Washington Mutual Bank /
Debt not acquired
by JPMorgan WAMU 5.550 0.616 6/16/2010
Westmoreland Coal Co WLBA 8.750 40.000 1/1/2022
Westmoreland Coal Co WLBA 8.750 27.125 1/1/2022
iHeartCommunications Inc IHRT 14.000 12.500 2/1/2021
iHeartCommunications Inc IHRT 9.000 73.000 12/15/2019
iHeartCommunications Inc IHRT 9.000 73.250 12/15/2019
iHeartCommunications Inc IHRT 14.000 12.072 2/1/2021
iHeartCommunications Inc IHRT 14.000 12.072 2/1/2021
iHeartCommunications Inc IHRT 9.000 73.250 12/15/2019
iHeartCommunications Inc IHRT 9.000 73.250 12/15/2019
rue21 inc RUE 9.000 1.739 10/15/2021
*********
Monday's edition of the TCR delivers a list of indicative prices
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