/raid1/www/Hosts/bankrupt/TCR_Public/190116.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, January 16, 2019, Vol. 23, No. 15
Headlines
ADVAXIS INC: Marcum LLP Raises Going Concern Doubt
AEGEAN MARINE: Claim Filing Deadline Set for February 21
AMERICAN CENTER FOR CIVIL: Seeks to Retain J. Casello as Attorney
ANGEL MEDICAL: Seeks to Hire JND Corporate as Claims Agent
ANTELOPE VALLEY: Moody's Alters Outlook on Ba3 Rev. Bonds to Neg.
API HEAT: Moody's Lowers CFR to C & Alters Outlook to Stable
AQUA MARINE: Amount of New Value Contribution Not Yet Known
AQUEOUS LLC: Hires Andersen Law as General Reorganization Counsel
ASSOCIATED ORAL: Case Summary & 6 Unsecured Creditors
ATIF INC: Creditor Trustee Taps Becker as Special Counsel
AVALON ADVANCED: Funding Concerns Cast Going Concern Doubt
BEAUTY BRANDS: Taps Donlin Recano as Claims Agent
BEAVER'S DAIRY: Has Interim Approval to Use Cash Through March 15
BENTWOOD FARMS: Taps Moon Wright as Legal Counsel
BOWLING GREEN: Corporate President to Infuse $25K to Proposed Plan
BRIAN G. MEEHAN: PCO Hire Gibbons P.C. as Counsel
CABLE ONE: Moody's Retains Ba3 CFR, Outlook Stable
CELADON GROUP: Royce & Associates Has 6.3% Stake as of Dec. 31
CENTURY III MALL: Hires Schneider Downs Meridian as Accountant
CHARLOTTE RUSEE: Moody's Lowers CFR to Ca, Outlook Stable
CHARLOTTE RUSSE: S&P Lowers ICR to 'CCC-', Outlook Negative
CHARTER COMMUNICATIONS: Moody's Rates New Sr. Sec. Bonds Ba1
CHASRIN INC: Trustee Hires Prager Metis CPA as Accountant
CHASRIN INC: Trustee Taps Klestadt Winters as General Counsel
CHINA LIAONING DINGXU: Significant Losses Cast Going Concern Doubt
CHOATES GENERAL: DOJ Watchdog Directed to Appoint Ch. 11 Trustee
CLYDE EVANS: Seeks Authorization to Use Cash Collateral
CLYDE EVANS: Taps Diller and Rice as Legal Counsel
COMMUNITY MEMORIAL: Moody's Affirms Ba2 on $339MM Revenue Bonds
COMPLETE FITNESS: PCO Files 1st Report for Troy Facility
CT TECHNOLOGIES: Moody's Raises CFR to Caa2, Outlook Stable
CYN RESTAURANTS: Unsecureds to Recoup 25% Under Latest Plan
DESERT LAND: Sher Creditors Seek Rejection of Amended Plan Outline
DIGICEL GROUP: Fitch Upgrades Issuer Default Rating to CCC
DPW HOLDINGS: Amends Form 8-K Report to Provide Update on SPA
DPW HOLDINGS: Signs 10-Day Forbearance Agreement with Calgary
DURR MECHANICAL: Hires Grassi & Co. as Financial Advisor
DURR MECHANICAL: Hires LaMonica Herbst & Maniscalco as Counsel
DURR MECHANICAL: Taps Shipman & Goodwin as Special Counsel
DYNAMIC MRI: Unsecureds to Get 10% of Allowed Claims in 60 Months
EDWARD'S BODY: Seeks to Hire Orshan as Legal Counsel
EQUINOX HOME: Has Until May 30 to Exclusively File Chapter 11 Plan
EXCHANGE AVENUE: Taps Energynet.com as Auctioneer
FIRELANDS GROUP: Seeks March 31 Exclusive Filing Period Extension
GARY REED ENTERPRISES: Taps Yaeger Treviso as Accountant
GOODWILL INDUSTRIES: Seeks to Hire Von Briesen as Counsel for PFA
IHEARTMEDIA INC: US Stay Bid on Jan. 10 Plan Hearing Denied
INFORMATION TECHNOLOGY: Seeks to Hire Stonecipher as Counsel
INNOVATIVE MATTRESS: Tempur Sealy Providing DIP Financing
IOTA COMMUNICATIONS: Delays Form 10-Q for Period Ended Nov. 30
JC PENNEY: Fitch Lowers LT IDR to B-, Outlook Stable
KIMBALL HILL: TRG Entitled to Recover $9.5MM in Damages from F&D
L R & T INC: Seeks to Hire Friday Walker as Accountant
LA STEEL SERVICES: Wants Court to Approve Proposed Plan Outline
LANNETT COMPANY: Moody's Confirms B3 CFR & Alters Outlook to Neg.
LBI MEDIA: Files Amended Joint Chapter 11 Reorganization Plan
LEVIATHAN CANNABIS: Misses Financial Statement Filing Deadline
LEXARIA BIOSCIENCE: Capital Deficiency Casts Going Concern Doubt
MESOBLAST LIMITED: Ends Recruitment in MPC-150-IM Phase 3 Trial
MESOBLAST LIMITED: Highlights 2019 Priorities at Biotech Showcase
MOHDSAMEER ALJANEDI: PCO Files 8th Interim Report
NEXTMARK INC: Negative Cash Flow Raises Going Concern Doubt
NICHOLAS L HUGENTOBLER: Hires Solga & Jakino as Accountant
NOVETTA SOLUTIONS: Moody's Alters Outlook on Caa1 CFR to Stable
OBITX INC: Accumulated Deficit Casts Going Concern Doubt
OLAIDE DARAMOLA: Plan Outline Hearing Set for March 22
PACIFIC GAS: Moody's Lowers CFR to Caa3, Outlook Negative
PACIFIC GAS: Says Looming Chapter 11 Filng Won't Affect Services
PG&E CORP: Fitch Lowers LT Issuer Default Rating to C
PG&E CORP: S&P Lowers ICR to 'CC' on Expected Bankr. Filing
QEP RESOURCES: Fitch Cuts IDR to BB-; Still on Rating Watch Neg.
QEP RESOURCES: S&P Cuts ICR to to 'BB-', On CreditWatch Negative
RANDAL D. HAWORTH: Taps Lafollette Johnson as Special Counsel
REEL AMUSEMENTS: Secured Creditors' Treatment Modified in New Plan
REMARKABLE HEALTHCARE: Unsecureds to Recoup 5-10% Under New Plan
REPUBLIC METALS: Chose Valcambi SA as Stalking Horse Bidder
ROBERT T. WINZINGER: Plan Confirmation Hearing Set for Feb. 7
SALSGIVER INC: Unsecured Creditors to Recover 60% Over 72 Months
SANDRA W RUTHERFORD: Seeks to Hire Dunn Cooper as Accountant
SAUK PRAIRIE: Moody's Alters Outlook on B1 Bonds Rating to Stable
SEMILEDS CORP: Operating Losses Cast Going Concern Doubt
SENIOR NH: Seeks April 22 Exclusive Plan Filing Period Extension
SHIFTPIXY INC: Recurring Losses Casts Going Concern Doubt
STEAM DISTRIBUTION: Plan Confirmation Hearing Scheduled for Feb. 27
SURGERY PARTNERS: S&P Lowers Long-Term ICR to 'B-', Outlook Stable
TANZANIAN ROYALTY: Financing Requirement Casts Going Concern Doubt
TREATMENT CENTER: Plan Outline OK'd; Plan Hearing Set for Feb. 14
TRIBECA FIT: Seeks to Hire Ballon Stoll as Legal Counsel
TSC/GREEN ACRES: Amends Manner of Plan Payment
UNIVERSITY PHYSICIAN: Taps AlixPartners as Financial Advisor
UPPER CUTS: Seeks to Hire AP Law Group as Legal Counsel
VALADOR INC: Seeks Authority to Use Essex Bank Cash Collateral
VARI-FORM INC: Gets CCAA Stay Order; PwC Named Monitor
VIRTUS INVESTMENT: S&P Affirms 'BB' ICR, Outlook Stable
VOIP-PAL.COM: Davidson & Company LLP Raises Going Concern Doubt
WALL STREET THEATER: New Plan Discloses Inter-Creditor Settlements
WASEEM INC: Seeks to Hire Wall Law Office as Legal Counsel
WORLD LIQUIDATORS: Seeks to Hire Mancuso Law as Legal Counsel
*********
ADVAXIS INC: Marcum LLP Raises Going Concern Doubt
--------------------------------------------------
Advaxis, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K, disclosing a net loss of
$66,515,000 on $6,063,000 of net revenue for the year ended October
31, 2018, compared to a net loss of $93,435,000 on $12,031,000 of
net revenue for the year ended in 2017.
The audit report of Marcum LLP states that the Company has incurred
significant losses and needs to raise additional funds to meet its
obligations and sustain its operations. These conditions raise
substantial doubt about the Company’s ability to continue as a
going concern.
The Company's balance sheet at October 31, 2018, showed total
assets of $62,267,000, total liabilities of $38,216,000, and a
total stockholders' equity of $24,051,000.
A copy of the Form 10-K is available at:
https://bit.ly/2FsVEP6
Advaxis, Inc., is a late-stage biotechnology Company focused on the
discovery, development and commercialization of proprietary
Listeria monocytogenes (Lm) Technology antigen delivery products
based on a platform technology that utilizes live attenuated Lm
bioengineered to secrete antigen/adjuvant fusion proteins.
AEGEAN MARINE: Claim Filing Deadline Set for February 21
--------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York set
Feb. 21, 2019, at 5:00 p.m. (Eastern Time) as last date and time
for each person or entity to file proofs of claim against Aegean
Marine Petroleum Network Inc. and its debtor-affiliates.
Each proof of claim must be submitted on or before the bar date
by:
i) electronically using the interface available on the notice
and claims agent's website at https://dm.epiq11.com/aegean;
ii) first-class U.S. mail at:
Aegean Marine Petroleum Network Inc.
Claims Processing Center
c/o Epiq Corporate Restructuring LLC
P.O. Box 4412
Beaverton, Oregon 97076
iii) overnight mail or other hand delivery system at:
Aegean Marine Petroleum Network Inc.
Claims Processing Center
c/o Epiq Corporate Restructuring LLC
10300 SW Allen Blvd.
Beaverton, Oregon 97005
About Aegean Marine Petroleum Network
Aegean Marine Petroleum Network Inc. -- http://www.ampni.com/-- is
an international marine fuel logistics company that markets and
physically supplies refined marine fuel and lubricants to ships in
port and at sea. The Company procures product from various sources
(such as refineries, oil producers, and traders) and resells it to
a diverse group of customers across all major commercial shipping
sectors and leading cruise lines. Currently, Aegean has a global
presence in more than 30 markets and a team of professionals ready
to serve its customers wherever they are around the globe.
Aegean Marine Petroleum Network Inc., et al., sought bankruptcy
protection on Nov. 6, 2018 (Bankr. D. Del. Lead Case No. Case No.
18-13374). The jointly administered cases are pending before Judge
Hon. Michael E. Wiles.
In the petition signed by Spyridon Fokas, general counsel and
secretary, Aegean Marine estimated assets of $1 billion to $10
billion and total liabilities of $500 million to $1 billion.
The Debtors tapped Kirkland & Ellis International LLP as general
counsel; Moelis & Company as Financial Advisor; Ernst & Young LLP,
as restructuring advisor; Epiq Bankruptcy Solutions, LLC as claims
agent.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors on Nov. 15, 2018. The committee tapped Akin
Gump Strauss Hauer & Feld LLP as its legal counsel.
AMERICAN CENTER FOR CIVIL: Seeks to Retain J. Casello as Attorney
-----------------------------------------------------------------
American Center for Civil Justice, Religious Liberty & Tolerance
Inc. seeks approval from the U.S. Bankruptcy Court for the District
of New Jersey to continue to employ Joseph Casello, Esq., and his
firm Collins, Vella & Casello, LLC.
Mr. Casello was hired by the Debtor as temporary substitute for its
bankruptcy attorney who represented it during the early stage of
its Chapter 11 case. He will continue to handle the case after the
other attorney sought to be relieved as bankruptcy counsel.
The hourly rate charged by Mr. Casello is $400. The proposed
post-petition retainer is $10,000.
Mr. Casello is "disinterested" as defined in Section 101(14) of the
Bankruptcy Code, according to court filings.
Mr. Casello maintains an office at:
Joseph Casello, Esq.
Collins, Vella & Casello, LLC
2317 Route 34, Suite 1A
Manasquan, NJ 08736
Phone: (732) 751-1766
About American Center for Civil Justice
American Center for Civil Justice, Religious Liberty & Tolerance,
Inc., is a tax-exempt organization that provides legal services.
Its mission is to defend and foster religious liberty, protection
of civil and social and religious, tolerance. It is an affiliate
of American Center for Civil Justice, Inc.
ACCJ sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. D.N.J. Case No. 18-26095) on Aug. 12, 2018. In the
petition signed by Jed Perr, president, the Debtor estimated assets
of $1 million to $10 million and liabilities of $10 million to $50
million. Judge Christine M. Gravelle presides over the case. The
Debtor tapped Joseph Covello, Esq., at Lynn Gartner Dunne &
Covello, LLP, as its legal counsel.
ANGEL MEDICAL: Seeks to Hire JND Corporate as Claims Agent
----------------------------------------------------------
Angel Medical Systems, Inc., seeks approval from the U.S.
Bankruptcy Court for the District of Delaware to hire JND Corporate
Restructuring as its claims and noticing agent.
The firm will oversee the distribution of notices and the
maintenance, processing and docketing of proofs of claim filed in
the Debtor's Chapter 11 case.
The Debtor paid JND a retainer in the amount of $5,000.
Travis Vandell, chief executive officer of JND, disclosed in a
court filing that the firm is "disinterested" as defined in section
101(14) of the Bankruptcy Code, according to court filings.
The firm can be reached through:
Travis K. Vandell
JND Corporate Restructuring
8269 E. 23rd Avenue, Suite 275
Denver, CO 80238
Phone: 855-812-6112
Email: travis.vandell@jndla.com
Email: restructuring@jndla.com
About Angel Medical Systems Inc.
Angel Medical Systems, Inc. -- http://www.angel-med.com/-- is a
manufacturer of cardiac medical devices headquartered in Eatontown,
New Jersey.
Angel Medical Systems sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Del. Case No. 18-12903) on Dec. 31,
2018. At the time of the filing, the Debtor estimated assets of $1
million to $10 million and liabilities of $50 million to $100
million.
The Debtor tapped Morris James LLP as its bankruptcy counsel, and
Honigman Miller Schwartz and Cohn LLP as co-counsel with Morris
James.
ANTELOPE VALLEY: Moody's Alters Outlook on Ba3 Rev. Bonds to Neg.
-----------------------------------------------------------------
Moody's Investors Service has revised Antelope Valley Healthcare
District's (AVHD) (CA) outlook to negative from stable and affirmed
the organization's Ba3. The rating action affects $122 million of
revenue bonds.
RATINGS RATIONALE
Revision in the outlook to negative reflects recent turnover in the
senior leadership following the resignation of the organization's
CEO and CFO. Affirmation of the rating reflects the organization's
essentially to the service area and expectations that AVHD will
receive significant supplemental funding later this year that will
allow it to maintain positive cash flow.
Although AVHD has recently hired a new CEO we believe the
organization will continue to demonstrate weak governance and could
be exposed to additional management turnover in the future; the
recently hired CEO previously served as CEO at AVHD until he
resigned in 2013, which was the beginning of several years of
management turnover at the organization. Additional challenges
include operational issues that have been exposed in recent months
which may contribute to weaker operating performance, including a
recent electronic medical record conversion that has contributed to
a build-up in accounts receivable, and challenges over timely and
accurate internal reporting.
RATING OUTLOOK
Revision in the outlook to negative reflects our concern that
recent management turnover and ongoing challenges stemming from a
recent electronic medical record conversion will contribute to
operating pressure over the near term.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Stabilization of senior management over a multi-year period
- Ability to sustain positive operating margins and good cash
flow over multi-year period
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Continued management turnover
- Inability to identify funding sources to meet seismic needs
- Decline in operating performance or liquidity
- Violation of financial covenants
LEGAL SECURITY
The bonds are secured by a revenue pledge. Key financial covenants
include minimum days cash on hand of 55 days and annual debt
service coverage of 1.2x.
PROFILE
AVHD operates 420 licensed bed Antelope Valley Hospital, an acute
care hospital located in Lancaster, CA. AVHD is a political
subdivision of the State of California.
API HEAT: Moody's Lowers CFR to C & Alters Outlook to Stable
------------------------------------------------------------
Moody's Investors Service downgraded its ratings for API Heat
Transfer ThermaSys Corporation, including the company's Corporate
Family Rating (to C from Caa2) and Probability of Default rating
(to C-PD from Caa2-PD), and the ratings for the company's first
lien senior secured term loan (to Ca from B3). The downgrades
follow API's recently completed debt-for-equity exchange, which
Moody's views as tantamount to a default via the distressed
exchange of debt. The ratings outlook is stable as ratings now
reflect deemed recovery levels following the default event and the
subsequent restructuring of obligations at materially lower face
amounts, and notwithstanding the equity consideration that
creditors received as partial consideration in the exchange
transaction. As the rated debt no longer exists, Moody's will be
withdrawing its ratings.
Moody's took the following rating actions for API Heat Transfer
ThermaSys Corporation:
Corporate Family Rating, Downgraded to C, from Caa2
Probability of Default Rating, Downgraded to C-PD, from Caa2-PD
Senior Secured First Lien Term Loan due 2019, to Ca (LGD4) from B3
(LGD2)
Outlook change:
Outlook, changed to stable from negative
RATINGS RATIONALE
The ratings reflect deemed ultimate recovery levels given the event
of default that recently occurred. The out-of-court restructuring
entailed an approximate 70% reduction in API's debt to roughly
$121.5 million, with an exchange of the first lien debt and unrated
mezzanine notes for new debt and common equity.
The principal methodology used in these ratings was Global
Manufacturing Companies published in June 2017.
Headquartered in Buffalo, New York, API Heat Transfer ThermaSys
Corporation is a designer and manufacturer of industrial heat
exchangers. The company was formed following the combination of two
legacy entities: API Group Holdings, LLC and ThermaSys Group
Holding in April 2012. API offers a broad range of heat transfer
products through its various business segments, including
Compressor & Dryer, Engine Cooling, Hydraulic Fluid Power, Process
& Industrial, Sanitary Systems and Thermasys Tubing. The company
was formerly majority-owned by private equity sponsor Wellspring
Capital Partners. For the twelve months ended September 30, 2018,
API generated approximately $315 million of revenue.
AQUA MARINE: Amount of New Value Contribution Not Yet Known
------------------------------------------------------------
Aqua Marine Enterprises, Inc., filed an Amended Chapter 11 plan and
accompanying disclosure statement disclosing that the amount of the
loan the equity interest holders will contribute as "new value" is
yet unknown.
Non-priority Unsecured Claims: This class consists of all allowed
general unsecured claims which are impaired. The total amount of
unsecured claims exceeds $100,000. The claims are of every kind and
nature. Holders of general unsecured claims without priority which
are Allowed Claims as determined on or before the Effective Date of
the Plan shall be paid on a pro rata distribution. Payment to the
creditors in this class shall be made from the Debtors future net
income. Debtor reasonably believes that creditors in this class
will receive a distribution equal 100% percent of their Allowed
Claim. Allowed Claims in this class shall receive monthly payments
commencing on the Effective Date of the Plan and continuing over a
period of sixty months.
Secured claim of K&B Fabricators, Inc.: This Class consists of the
disputed Claim of K&B Fabricators, Inc. ("K&B") which is impaired.
The amount of the Claim is unknown but consists of the damages
asserted by K&B against the Debtor and non debtor Brent Mitchell in
the Lawsuit. The Debtor proposes that it will pay, settle and
satisfy this claim by paying K&B the sum of $162,320 over a thirty
six month (36) month period with an interest rate of 5.25% in
monthly installments of $4,883.12 or as otherwise ordered by this
Court.
This Class consists of the Allowed Priority Claim of the Internal
Revenue Service ("IRS"). The IRS has filed a claim for FUTA taxes
for the tax year ending 2017 and FICA taxes for the 1st quarter of
2018 in the amount of $0. Upon information and inquiry, the Debtor
is not obligated to the IRS for any tax liability.
This Class consists of the Allowed claims of the equity
shareholders of the Debtor. The Debtor is owned by Melanie Mitchell
(25%); Robert Brent Mitchell (25%); Doris Mitchell (26%) and Robert
Mitchell (24%). The claims of the interest holders in this class
are impaired.
The Debtor will implement the terms of its proposed Plan by making
payments to allowed claim holders from funds that the Debtor has on
deposit and by making payments to Creditors with Allowed Claims
from the Debtor's post-petition income.
A full-text copy of the Amended Disclosure Statement dated December
24, 2018, is available at:
http://bankrupt.com/misc/alnb18-1880464CRJ11-228.pdf
About Aqua Marine Enterprises
Aqua Marine Enterprises, Inc., manufacturer of Safe-T-Shelter safe
rooms, has been manufacturing and installing safety shelters since
1995. The company is headquartered in Hartselle, Alabama.
Aqua Marine Enterprises sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ala. Case No. 18-80464) on Feb. 16,
2018. In the petition signed by R.B. Mitchell, vice-president, the
Debtor disclosed $1.51 million in assets and $401,565 in
liabilities. Judge Clifton R. Jessup Jr. presides over the case.
Heard, Ary & Dauro, LLC, is the Debtor's counsel.
AQUEOUS LLC: Hires Andersen Law as General Reorganization Counsel
-----------------------------------------------------------------
Aqueous LLC seeks authority from the United States Bankruptcy Court
for the District of Nevada (Las Vegas) to hire Andersen Law Firm
nunc pro tunc to Jan. 4, 2019, as its general reorganization
counsel.
Services Andersen Law Firm will provide are:
a) advise the Debtor with respect to its powers and duties as
a debtor and debtors-in-possession in the continued management and
operation of its business and property;
b) attend meetings and negotiate with representatives of
creditors and other parties in interest and advise and consult on
the conduct of the Chapter 11 case, including the legal and
administrative requirements of operating in Chapter 11;
c) take all necessary action to protect and preserve the
bankruptcy estate, including the prosecution of actions on its
behalf, the defense of any actions commenced against the bankruptcy
estate, negotiations concerning all litigation in which the Debtor
may be involved, and objections to claims filed against the
bankruptcy estate;
d) prepare on behalf of the Debtor all motions, applications,
answers, orders, reports, and papers necessary to the
administration of the estate;
e) negotiate and prepare on the Debtor's behalf plan(s) of
reorganization, disclosure statement(s), and all related agreements
and/or documents and take any necessary action on behalf of the
Debtor to obtain confirmation of
such plan(s);
f) advise the Debtor in connection with any sale of assets;
g) appear before this Court, any appellate courts, and the
U.S. Trustee, and protect the interests of the bankruptcy estate
before such courts and the U.S. Trustee; and
h) perform all other necessary legal services and provide all
other necessary legal advice to the Debtor in connection with its
Chapter 11 case.
The Firm was paid a retainer of $15,000 by the Debtor. $10,609.69
of this initial retainer remains and is held in the Andersen Law
Firm trust account.
The firm's prevailing hourly rates are:
Ryan A. Andersen, Esq. $360
Ani Biesiada, Esq. $270
Paralegals $130
Members of the Andersen Law Firm are "disinterested persons" as
such term is defined in Section 101(14) and do not hold or
represent any interest adverse to Debtor or Debtor's bankruptcy
estate, as disclosed in the Court filing.
The firm can be reached at:
Ryan A. Andersen, Esq.
Ani Biesiada, Esq.
ANDERSEN LAW FIRM, LTD.
101 Convention Center Drive, Suite 600
Las Vegas, NV 89109
Phone: 702-522-1992
Fax: 702-825-2824
About Aqueous LLC
Aqueous LLC is a real estate lessor based in Sheridan, Wyoming.
Aqueous LLC filed a voluntary petition under Chapter 11 of the US
Bankruptcy Code (Bankr. D. Nev. Case No. 19-10057) on Jan. 4, 2019.
In the petition signed by Wendy J. Merrill, managing member, the
Debtor estimates $576,609 in assets and $1,053,306 in liabilities.
The case is assigned to Judge August B. Landis.
Andersen Law Firm, Ltd., is the Debtor's counsel.
ASSOCIATED ORAL: Case Summary & 6 Unsecured Creditors
-----------------------------------------------------
Debtor: Associated Oral Specialties, Inc.
5671 Peachtree Dunwoody Road, Suite 420
Atlanta, GA 30342
Business Description: Associated Oral Specialties, Inc. is a
provider of comprehensive oral specialty
care in Atlanta, Georgia. Associated
Oral offers CBCT scans, digital x-rays,
root canal (Endodontic) therapy, root canal
(Endodontic) retreatment, root canal
surgery (Apicoectomy), cure for traumatic
dental injuries, incision and drainage,
biopsy, implants, sedation dentistry,
preprosthetic surgery, alveoplasty,
frenectomy, sleep apnea treatment,
bone grafting, and IV Conscious sedation
services.
On the web:
https://associatedoralspecialties.com/
Chapter 11 Petition Date: January 14, 2019
Court: United States Bankruptcy Court
Northern District of Georgia (Atlanta)
Case No.: 19-50715
Debtor's Counsel: Will B. Geer, Esq.
WIGGAM & GEER, LLC
50 Hurt Plaza, SW, Suite 1245
Atlanta, GA 30303
Tel: (678) 587-8740
Fax: (404) 287-2767
Email: wgeer@wiggamgeer.com
Total Assets: $249,928
Total Liabilities: $1,503,794
The petition was signed by Freddie J. Wakefield, Jr., CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's six largest unsecured creditors is available
for free at:
http://bankrupt.com/misc/ganb19-50715.pdf
ATIF INC: Creditor Trustee Taps Becker as Special Counsel
---------------------------------------------------------
Daniel Stermer, the Creditor Trustee for ATIF, Inc., seeks
authority from the United States Bankruptcy Court for the Middle
District of Florida, Fort Myers Division, to retain Jon Polenberg
and Becker & Poliakoff, P.A., as special counsel.
Creditor Trustee seeks to employ Becker to investigate and, as
appropriate, pursue all possible Avoidance Actions 1 under Chapter
5 of the Bankruptcy Code.
Beckers compensation are:
a. 35% contingency fee calculated as the product of (1) total
recovery less all costs and expenses incurred for investigating and
prosecuting the Avoidance Actions, and (2) 35%; and
b. payment of, or reimbursement for, any and all out-of-pocket
expenses, including expert witness fees and expenses, as approved
by the Bankruptcy Court, as the estate accumulates, collects, or
recovers assets from which to make such payment or reimbursement.
Jon Polenberg, and partner of the law firm Becker & Poliakoff, PA,
attests that Becker does not represent any other creditors or
parties in interest in Debtor's bankruptcy case and does not
represent or hold any interest adverse to Debtor's estate.
The counsel can be reached at:
Jon Polenberg, Esq.
Becker & Poliakoff
1 East Broward Blvd., Suite 1800
Ft. Lauderdale, FL 33301
Phone: (954) 364-6037
Fax: (954) 985-4176
E-mail: JPolenberg@bplegal.com
About ATIF Inc.
ATIF, Inc., sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. M.D. Fla. Case No. 17-01712) on March 2, 2017. In the
petition signed by Gerard A. McHale, its chief executive officer,
the Debtor estimated assets of less than $500,000 and liabilities
of $10 million to $50 million.
Michael C. Markham, Esq., at Johnson, Pope, Bokor, Ruppel & Burns
LLP serves as the Debtor's legal counsel. The Debtor hired Buell &
Elligett, P.A., as its special counsel.
On April 13, 2017, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee retained
Messana, P.A., as its bankruptcy counsel; and Becker & Poliakoff,
P.A., as its special counsel.
On July 5, 2018, the Bankruptcy Court entered an order confirming
the Second Amended Chapter 11 Plan and explanatory Disclosure
Statement filed by the Creditors' Committee for ATIF, Inc. The
Plan establishes the ATIF Inc. Creditor Trust and appointed Daniel
Stermer as the Creditor Trustee. Mr. Stermer has hired Buchanan
Ingersoll & Rooney PC as special counsel.
AVALON ADVANCED: Funding Concerns Cast Going Concern Doubt
----------------------------------------------------------
Avalon Advanced Materials Inc. filed its January 2019 report on
Form 6-K, disclosing Net Loss and Total Comprehensive Loss of
CAD1,569,937 on CAD13,941 of net revenues for the three months
ended November 30, 2018, compared with Net Loss and Total
Comprehensive Loss of CAD628,038 on CAD14,749 of net revenues for
the same period in 2017.
At November 30, 2018, the Company had total assets of
CAD121,911,765, total liabilities of CAD5,079,819, and
CAD116,831,946 in total stockholders' equity.
The Company will need to raise additional capital to meet its
ongoing expenditure obligations or reduce its current overhead
costs. Initiatives both to reduce overhead costs and to raise
additional capital are in progress although there can be no
assurances that the Company will be able to raise additional funds
required for all planned expenditures. As a result, certain
expenditures may have to be delayed until sufficient funding has
been raised. Given the continuation of weak investor sentiment and
capital market conditions in the junior resource sector, there
exists uncertainty as to the Company's ability to raise sufficient
additional funds on favorable terms. This condition indicates the
existence of a material uncertainty that raises substantial doubt
about the Company's ability to continue as a going concern. The
Company's expenditures on other discretionary exploration and
development activities have some scope for flexibility in terms of
amount and timing, which can be adjusted accordingly.
A copy of the Form 6-K is available at:
https://bit.ly/2CptgcP
Avalon is a Canadian mineral exploration and development company
that is listed on the Toronto Stock Exchange in Canada, traded on
the OTCQB Venture Market in the United States and also trades on
the Frankfurt Stock Exchange in Germany. The Company seeks to
build shareholder value by becoming a diversified sustainable
producer and marketer of specialty metals and minerals and by
expanding the markets for its mineral products. Avalon operates
primarily in Canada with a focus on the "Technology Metals" or
"Cleantech Materials", including tin, lithium, tantalum, niobium,
cesium, indium, gallium, germanium, rare earth elements ("REE"),
yttrium, and zirconium.
BEAUTY BRANDS: Taps Donlin Recano as Claims Agent
-------------------------------------------------
Beauty Brands, LLC, received approval from the U.S. Bankruptcy
Court for the District of Delaware to hire Donlin, Recano &
Company, Inc., as claims and noticing agent.
The firm will oversee the distribution of notices and the
maintenance, processing and docketing of proofs of claim filed in
the Chapter 11 cases of the company and its affiliates.
Donlin's hourly rates for professional services are:
Executive Staff No charge
Senior Bankruptcy Consultant $130 - $165
Case Manager $90 - $130
Technology/Programming Consultant $60 - $100
Consultant/Analyst $50 - $80
Clerical $25 - $45
The firm received a $15,000 retainer prior to the Debtors'
bankruptcy filing.
Nellwyn Voorhies, executive director of Donlin, disclosed in a
court filing that the firm is "disinterested" as defined in section
101(14) of the Bankruptcy Code.
The firm can be reached through:
Nellwyn Voorhies
Donlin, Recano & Company, Inc.
6201 15th Avenue,
Brooklyn, NY 11219
Phone: 212.481.1411
About Beauty Brands
Founded in 1995 and headquartered in Kansas City, Missouri, Beauty
Brands, LLC, et al., operate specialty beauty stores under the
trade name "Beauty Brands" that provide salon and spa services and
retail and third-party branded beauty products. Beauty Brands --
https://www.beautybrands.com/ -- currently operate 58 retail
locations in Kansas, Texas, Oklahoma, North Carolina, Arizona,
Colorado, Illinois, Nebraska, Iowa, Indiana, Ohio, and Missouri,
and an e-commerce business managed out of its distribution center
located in Lenexa, Kansas. As of the Petition Date, the Company
employed approximately 1,571 people.
Beauty Brands, LLC, and two affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 19-10031) on Jan. 6, 2019.
Beauty Brands estimated assets of $10 million to $50 million and
liabilities of the same range.
The Debtors tapped Ashby & Geddes, P.A., as counsel; Lazard Middle
Market as investment banker; RAS Management Advisors, LLC as
restructuring advisor; Hilco Merchant Resources, LLC, as sale and
liquidation agent; and Donlin, Recano & Company, Inc., as claims
and noticing agent.
BEAVER'S DAIRY: Has Interim Approval to Use Cash Through March 15
-----------------------------------------------------------------
The Hon. Carl L. Bucki of the U.S. Bankruptcy Court of the Western
District of New York has inked his approval to a Stipulation and
Order authorizing Beaver Dairy Farm, LLC to use cash collateral on
an interim basis.
The Stipulation is entered into between the Debtor, Beaver's
Trucking Co., LLC and Dale F. Beaver and Farm Credit East, ACA to
allow the use of cash collateral by Debtor, on a limited basis.
Said cash collateral is presently subject to the security interests
held by Farm Credit.
Prior to the Petition Date, the Debtor had operated under the terms
of various pre-petition financing agreements with Farm Credit,
pursuant to which Farm Credit provided secured financing to the
Debtor in the approximate amount of $3.1 Million. The Debtor's
obligations under the Prepetition Loan Documents are collateralized
by first priority security interests in all of the Debtor's
personal property assets and mortgages on certain parcels of real
estate located in Cattaraugus County, New York.
Farm Credit will receive a rollover security interest in and valid,
binding, enforceable and perfected liens on all of the Debtor's
Postpetition Collateral, which replacement liens will be of the
same extent, priority and validity as the liens held by Farm Credit
pre-petition. All Farm Credit Cash Collateral which arises after
the Petition Date will secure payment of the Pre-Petition Loans.
The Postpetition Collateral, however, will not include any claims
of the Debtors pursuant to chapter 5 of the Bankruptcy Code or any
monies or other property recovered in connection with the
successful prosecution or settlement of Avoidance Claims.
The approved 13-week budget provides total cash disbursements of
approximately $1,130,359 during the week ending Dec. 21, 2018
through week ending March 15, 2019.
Moreover, the Parties have agreed that the Debtor is authorized to
use cash collateral, provided that the Debtor meets each of the
following conditions:
() The Debtor will continue making adequate protection
payments to Farm Credit in the amount of $5,000 per week to be
received by Farm Credit on Friday of every week hereafter, to be
applied to Farm Credit Loan ending #201 in accordance with the Loan
Documents.
(b) The Debtor will provide written verification to Farm
Credit that they have maintained, and will continue to maintain,
insurances on Farm Credit Non-Cash Collateral and Real Property,
naming Farm Credit as mortgagee/additional insured.
(c) The Debtor will also file a motion pursuant to 11 U.S.C.
Section 365 to approve an operating lease with Nathan Beaver (or
his direct affiliates) for newly acquired cattle no later than Jan.
11, 2019, which lease terms will be acceptable to Farm Credit.
(d) To the extent that the pledges, liens and security
interests granted to Farm Credit are inadequate, Farm Credit may
have its claims allowed as administrative priority claims pursuant
to Sections 503(b) and 507(b) of the Bankruptcy Code, with priority
over any and all claims against the Debtor of any kind whatsoever,
and said right will continue notwithstanding the appointment of a
Chapter 11 trustee or, to the extent provided by the Bankruptcy
Code, the conversion of Debtor's case under Chapter 7 of the
Bankruptcy Code.
(e) The Debtors will deliver to Farm Credit, during the cash
collateral period: (i) cash receipts and disbursement reports; (ii)
a monthly report covering the previous and setting forth an
itemization of sales of cull cows and calves, a report as to all
open post-bankruptcy receivables and payables, estimated silage
inventory and herd count by class; (iii) a monthly cash budget
analysis showing actual performance versus budget, together with a
report of the initial and ending cash position of the Debtors for
such month and the collections during such month; and (iv) Debtor
will timely comply with all reporting requirements of the Office of
the U.S. Trustee and its Monthly Operating Reports will be timely
filed on the ECF system.
A full-text copy of the Interim Order is available at
http://bankrupt.com/misc/nywb18-12409-49.pdf
About Beaver Dairy Farm
Beaver Dairy Farm LLC is a privately held company in Randolph, New
York, in the dairy farms business. Beaver's Trucking Co. is
operates in the specialized freight trucking industry.
Beaver Dairy Farm, LLC and Beaver's Trucking Co., LLC filed Chapter
11 bankruptcy petitions (Bankr. W.D.N.Y. Case Nos. 18-12409 and
18-12411, respectively) on Nov. 16, 2018.
In the petitions signed by Dale F. Beaver, owner, Beaver Dairy
estimated $1 million to $10 million in assets and the same range of
liabilities; and Beaver's Trucking estimated $100,000 to $500,000
in assets and $50,000 to $100,000 in liabilities.
The cases are assigned to Judge Carl L. Bucki.
The Debtors are represented by Garry M. Graber, Esq. at Hodgson
Russ LLP.
BENTWOOD FARMS: Taps Moon Wright as Legal Counsel
-------------------------------------------------
Bentwood Farms, LLC, received approval from the U.S. Bankruptcy
Court for the Western District of North Carolina to hire Moon
Wright & Houston, PLLC, as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; represent the Debtor in all adversary proceedings
related to its Chapter 11 case; assist in the preparation of a
bankruptcy plan; and provide other legal services in connection
with the case.
Moon Wright charges these hourly fees:
Richard Wright Attorney $500
Andrew Houston Attorney $450
Caleb Brown Attorney $250
Cole Hayes Attorney $235
Shannon Myers Paralegal $180
The firm is "disinterested" as defined in section 101(14) of the
Bankruptcy Code, according to court filings.
Moon Wright can be reached through:
Cole Hayes, Esq.
Moon Wright & Houston, PLLC
121 West Trade Street, Suite 1950
Charlotte, NC 28202
Tel: 704-944-6565
Fax: 704-944-0380
Email: chayes@mwhattorneys.com
- and -
Richard S. Wright, Esq.
Moon Wright & Houston, PLLC
121 W. Trade Street, Suite 1950
Charlotte, NC 28202
Tel: (704) 944-6564
Tel: (704) 944-6560
Fax: (704) 944-0380
Email: rwright@mwhattorneys.com
Email: smyers@mwhattorneys.com
About Bentwood Farms
Bentwood Farms, LLC, is a North Carolina limited liability company
having a corporate headquarters located at 1101 Circle Drive,
Monroe, NC 28110. The Company operates in the crop farming
industry.
Bentwood Farms filed a Chapter 11 petition (Bankr. W.D.N.C. Case
No. 18-31823) on Dec. 7, 2018. In the petition signed by Charlie
B. Baucom, president, the Debtor estimated less than $50,000 in
assets and less than $10 million in liabilities. Judge Craig J.
Whitley oversees the case. The Debtor is represented by Moon
Wright & Houston, PLLC.
BOWLING GREEN: Corporate President to Infuse $25K to Proposed Plan
------------------------------------------------------------------
Bowling Green Recycling of Warren County, Inc., and Bowling Green
Recycling II, Inc. filed a disclosure statement in support of their
plan of reorganization, dated Jan. 4, 2019, which contemplates the
reorganization of existing debt, and continuation of the Debtors'
normal business operations.
Class D under the plan consists of the Allowed Unsecured Claims of
the Debtors' Critical Trade Vendors, totaling $184,490.62.
Commencing on the Effective Date of the Plan, this Class will be
paid 100% of its claims with the contractual rate of interest, with
pro-rata payments over a term of 60 months, in the sum of $9,224.53
per quarter. Class D is impaired and entitled to vote.
Class E consists of the Allowed Unsecured Claims of Debtors’
Necessary Operational Creditors, totaling $51,943.26. Commencing on
the Effective Date of the Plan, this Class will be paid 100% of its
claims with the contractual rate of interest, with pro rata
payments over a term of 60 months, in the sum of $2,597.16 per
quarter. Class E is impaired and entitled to vote.
Class F consists of the disputed General Unsecured Claim of
National Union Fire Insurance Co., totaling $1,934,272.15.
Commencing on the Effective Date of the Plan, this Class will be
paid $25,000 without interest, with payments over a term of 60
months, in the sum of $1,250.01 per quarter. Class F is impaired
and entitled to vote.
Upon entry of the Confirmation Order, the Debtors will continue to
operate their business and manage their assets, which will generate
income projected to be sufficient for the Debtors to meet their
ongoing expenses and the obligations contemplated under the Plan.
In particular, the Debtors will focus their efforts and resources
on maintaining their current business relationships and expanding
their customer base.
Sue Lofton, President, sole director and member of the Debtors,
will infuse $25,000 of new value into the Plan to be allocated to
plan payments. The $25,000 will come from the personal assets of
Ms. Lofton. Within 90 days of the Effective Date, Ms. Lofton will
pay $5,000 into the Chapter 11 Plan and will pay $5,000 annually,
until a total of $25,000 is paid into the Chapter 11 Plan.
A copy of the Disclosure Statement is available for free at
https://tinyurl.com/yagy4g99 from Pacermonitor.com at no charge.
About Bowling Green Recycling
Bowling Green Recycling of Warren County, Inc., and Bowling Green
Recycling II, Inc., specialize in industrial recycling of metals
and cardboard.
Recycling and Recycling II sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. W.D. Ky. Case Nos. 18-10366 and
18-10367) on April 23, 2018.
In the petitions signed by James T. Lofton, general manager,
Recycling estimated assets of less than $1 million and liabilities
of $1 million to $10 million. Recycling II estimated assets of
less than $500,000 and liabilities of $1 million to $10 million.
Judge Joan A. Lloyd presides over the cases.
The Debtors tapped Seiller Waterman LLC as their legal counsel; and
Broderick & Davenport, PLLC, is the special counsel.
BRIAN G. MEEHAN: PCO Hire Gibbons P.C. as Counsel
-------------------------------------------------
David N. Crapo, the patient care ombudsman appointed in the
bankruptcy case of Debtor Brian G. Meehan, M.D., P.C., seeks
authority from the U.S. Bankruptcy Court for the Southern District
of New York to employ Gibbons P.C. as counsel to the Ombudsman nunc
pro tunc to December 26, 2018.
The Ombudsman requires Gibbons to:
(a) represent the Ombudsman in any proceeding or hearing in
the Bankruptcy Court, and in any action in other courts where the
rights of the patients may be litigated or affected as a result of
the bankruptcy case;
(b) advise the Ombudsman concerning the requirements of the
Bankruptcy Code and Bankruptcy Rules and the requirements of the
Office of the United States Trustee relating to the discharge of
his duties under Section 333 of the Bankruptcy Code;
(c) advise and represent the Ombudsman concerning any
potential reorganization or sale of the Debtor's assets; and
(d) perform such other legal services as may be required under
the circumstances of this case in accordance with the Ombudsman's
powers and duties as set forth in the Bankruptcy Code.
Gibbons' current hourly rates are:
David N. Crapo, Esq. $570
Ellen Rosen, Senior Paralegal $285
David N. Crapo, Esq., counsel at the law firm of Gibbons P.C.,
attests that Gibbons does not represent or hold any interest
adverse to the interest of the Debtors or their estates, and is a
disinterested person within the meaning of sections 101(14) and
327(a) of the Bankruptcy Code.
The counsel can be reached through:
David N. Crapo, Esq.
GIBBONS P.C.
One Gateway Center
Newark, NJ 07102-5310
Telephone: (973) 596-4523
Facsimile: (973) 639-6244
E-mail: dcrapo@gibbonslaw.com
About Brian G. Meehan
Brian G. Meehan, M.D., P.C., based in New York, NY, filed a Chapter
11 petition (Bankr. S.D.N.Y. Case No. 18-13924) on Dec. 4, 2018.
In the petition signed by Brian G. Meehan, president, the Debtor
estimated $500,000 to $1 million in assets and $1 million to $10
million in liabilities. The Hon. Stuart M. Bernstein is the case
judge. Rich Michaelson Magaliff, LLP, serves as bankruptcy
counsel.
CABLE ONE: Moody's Retains Ba3 CFR, Outlook Stable
--------------------------------------------------
Moody's Investors Service says Cable One, Inc.'s Ba3 Corporate
Family Rating, Ba3-PD Probability of Default Rating, SGL-1
Speculative Grade Liquidity Rating, and Ba2 Senior Secured Bank
Credit Facility, and B2 senior unsecured notes ratings are
unchanged following the assignment of a Ba2 rating to the $250
million upsize of its Term Loan B. The Stable outlook is unchanged.
The incremental funds, plus cash on hand, will be used to acquire
Clearwave Communications, a broadband internet provider with a
high-capacity fiber network with dense regional coverage in
Southern Illinois. Moody's expects the incremental debt, relative
to its estimate of the earnings contribution, will cause adjusted
leverage to rise by about half turn at the close of the
transaction. However, Moody's believes that the acquisition will
improve the scale of Cable One's business services within its
existing footprint. Clearwave has more than 2,400 route miles of
dense metro fiber infrastructure connecting approximately 2,700
on-net businesses, towers and data centers. As synergies are
achieved, Moody's expects revenue and EBITDA growth will allow
Cable One to delever and maintain its leverage in line with its Ba3
CFR rating.
New Assignments:
Issuer: Cable One, Inc.
Senior Secured Bank Credit Facility, Ba2 (LGD3)
Outlook Actions:
Issuer: Cable One, Inc.
Outlook, Remains Stable
RATINGS RATIONALE
Cable One's Ba3 corporate family rating reflects the company's
strong balance sheet and good liquidity, with key credit metrics
that are more similar to investment grade peers. Moody's projects
adjusted leverage (Moody's adjusted) will be near 3x range at the
end of 2019. With strong free cash flows, the Company also
maintains very strong interest coverage and free cash flow to debt
metrics in the mid 4x and mid-teens percent range, respectively,
both very strong for a Ba3 credit. The company also benefits from a
wide footprint, superior network speeds, a favorable competitive
environment, and a very profitable business model that produces
EBITDA margins that are approaching 50%, with a cost structure that
continues to decline as broadband dominates the subscriber mix.
Constraining the rating is a weak position in video (and voice)
services. Moody's expects continual decline in the Company's video
business with subscriber losses greater 10% annually, well above
the average for the peer group. The service offering is subject to
intense competition and is being harvested for cash and profits.
Cable One is accepting very high levels of subscriber (subs) churn
in exchange for a smaller base of more profitable customers. The
Company's weakening market position in video is reflected in below
average performance, relative to its peers, with key performance
indicators including the triple play equivalent ratio and Revenue
per Homes Passed (RHP) which Moody's projects will be approximately
16-17% and about $515 at the end of 2019, respectively. In
addition, the company's broadband-centric strategy is significantly
reducing the number of triple and double play customers,
eliminating bundling opportunities, increasing product
concentration and regulatory risks as the company moves closer to a
singular broadband-only business.
Headquartered in Phoenix, AZ, Cable One, Inc. offers traditional
and advanced video services including digital television,
video-on-demand, high-definition television, as well as high-speed
Internet access and phone service. As of September 30, 2018, Cable
One had 329 thousand video subscribers, 661 thousand high-speed
data subscribers, and 128 thousand telephony subscribers with LTM
total revenue of approximately $1.1 billion.
CELADON GROUP: Royce & Associates Has 6.3% Stake as of Dec. 31
--------------------------------------------------------------
Royce & Associates, LP disclosed in a Schedule 13G/A filed with the
Securities and Exchange Commission that as of Dec. 31, 2018, it
beneficially owns 1,781,357 shares of common stock of Celadon
Group, Inc., which represents 6.29 percent of the shares
outstanding. A full-text copy of the regulatory filing is
available at no charge at: https://is.gd/GsSUlG
About Celadon
Celadon Group, Inc. -- http://www.celadongroup.com/-- provides
long haul, regional, local, dedicated, intermodal,
temperature-protect, and expedited freight service across the
United States, Canada, and Mexico. The Company also owns Celadon
Logistics Services, which provides freight brokerage services,
freight management, as well as supply chain management solutions,
including logistics, warehousing, and distribution. The Company is
headquartered in Indianapolis, Indiana.
In a press release dated April 2, 2018, Celadon stated that based
on issues identified in connection with the Audit Committee
investigation and management's review, financial statements for
fiscal years ended June 30, 2014, 2015, 2016, and the quarters
ended Sept. 30 and Dec. 31, 2016, will be restated. Celadon's new
senior management team, led by the Company's new chief financial
officer and new chief accounting officer, commenced a review of the
Company's current and historical accounting policies and
procedures. The internal investigation and management review have
identified errors that will require adjustments to the previously
issued 2014, 2015, 2016, and 2017 financial statements.
Celadon announced on Nov. 29, 2018, that it entered into a Twelfth
Amendment to Amended and Restated Credit Agreement by and among the
Company, certain subsidiaries of the Company as guarantors, Bank of
America, N.A., as lender and Administrative Agent, Wells Fargo
Bank, N.A., and Citizens Bank, N.A., both as lenders, which amends
the Company's existing Amended and Restated Credit Agreement dated
Dec. 12, 2014, among the same parties. Among other changes, the
Amendment extends the maturity date of the Credit Agreement to June
28, 2019.
On April 18, 2018, Peter Elkins, lead analyst at the New York Stock
Exchange LLC, filed a Form 25 with the Securities and Exchange
Commission notifying the removal from listing or registration of
Celadon's common stock on the Exchange.
CENTURY III MALL: Hires Schneider Downs Meridian as Accountant
--------------------------------------------------------------
Century III Mall PA, LLC, seeks authority from the United States
Bankruptcy Court for the Western District of Pennsylvania
(Pittsburgh) to hire Michael T. Von Lehman, and the accounting firm
of Schneider Downs Meridian, LP, to assist with accounting and
financial services.
Current hourly rates for SD Meridian are:
Shareholder/Managing Director $500
Senior Manager $435
Associate $290
Clerical $80
A retainer of $10,000 was paid on January 2, 2018.
Michael T. Von Lehman, CPA of the accounting firm of Schneider
Downs Meridian, LP, attests that he and the firm are disinterest
persons within the meaning of Sections 101(14) and 327 of the
Bankruptcy Code.
The firm can be reached at:
Michael T. Von Lehman, CPA
Schneider Downs Meridian, LP
One PPG Place, Suite 1700
Pittsburgh , PA 15222
Phone: 412-261-3644
Fax: 412-261-4876
About Century III Mall PA LLC
Century III Mall PA LLC -- http://www.centuryiiimall.com/-- owns
the Century III Mall shopping center located in West Mifflin,
Pennsylvania.
Century III Mall PA sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Pa. Case No. 18-23499) on Sept. 3,
2018. In the petition signed by Edward Sklyaroff, president, the
Debtor estimated assets of $1 million to $10 million and
liabilities of $1 million to $10 million. The Debtor tapped Kirk
B. Burkley, Esq., at Bernstein-Burkley, P.C., as its legal counsel.
CHARLOTTE RUSEE: Moody's Lowers CFR to Ca, Outlook Stable
---------------------------------------------------------
Moody's Investors Service downgraded its ratings for Charlotte
Russe, Inc. (New), including the company's Corporate Family Rating
(CFR; to Ca from Caa1) and Probability of Default Rating (to Ca-PD
from Caa1-PD), and the rating for the company's $90 million
principal amount senior secured term loan (to C from Caa1). The
ratings outlook is stable.
"Charlotte Russe significantly underperformed expectations in the
recent period when its turnaround efforts were to have commenced,
with results from the just filed third fiscal quarter showing
year-over-year negative double-digit same-store sales and
meaningful margin deterioration," noted Brian Silver, Moody's Vice
President and lead analyst for the company.
"With liquidity having also weakened considerably, we view the risk
of another requisite debt restructuring as meaningfully elevated
barring a significant turnaround in operational performance," added
Silver.
Moody's noted in its report that it anticipates first lien term
loan lenders will suffer material loss absorption in a subsequent
event of default scenario, with the bulk of the firm's value
encompassed by current assets and likley inuring only to the
benefit of priority secured ABL lenders.
The following ratings have been downgraded for Charlotte Russe,
Inc. (New):
Corporate Family Rating, to Ca from Caa1
Probability of Default Rating, to Ca-PD from Caa1-PD
$90 million Gtd Senior Secured Term Loan due 2023, to C (LGD5) from
Caa1 (LGD4)
Outlook action:
Outlook, Stable (unchanged)
RATINGS RATIONALE
Charlotte Russe Inc. (New)'s ratings are broadly constrained by its
weak liquidity profile following a very challenging 3Q18 wherein
comparable same-store sales declined 11.7% year-over-year, as well
as ongoing headwinds growing its topline and profitability
resulting from store closures and customer traffic declines. The
company also has weak interest coverage as measured by
EBIT-to-interest expense, which is below 1 time for the twelve
months ended November 3, 2018, and has relatively low operating
margins. While entry into the value beauty category last year has
aided brand awareness, associated risks continue according to the
rating agency. The ratings do benefit, however, from a less
leveraged balance sheet than other companies at similar rating
levels (with Moody's-adjusted debt-to-EBITDA of just over 5 times
for the LTM period), as well as anticipated annual cost savings
from rent reductions, reduced store and corporate operating
expenses, and lower interest expense following its 2018 debt
restructuring.
The stable outlook reflects Moody's assertion that ratings have
been positioned in accordance with assumed recovery levels given
the rating agency's view that the company may enter into another
debt restructuring over the next 12-18 months.
The ratings could be downgraded (although this could entail only
the PDR) if the company enters into a debt restructuring and/or
files for bankruptcy.
Alternatively, the ratings could be upgraded if Charlotte Russe is
able to achieve and maintain positive same-store sales comps and
improve its liquidity as evidenced by reduced reliance on its ABL.
The principal methodology used in these ratings was Retail Industry
published in May 2018.
Headquartered in San Francisco, California, Charlotte Russe, Inc.
(New) is a retailer of value-oriented 'fast fashion' apparel,
footwear and accessories. The company targets 18-24 year old women
and its key item categories include denim, dresses and shoes.
Charlotte Russe also entered the beauty category in April 2018 with
the launch of its "Charlotte by Charlotte Russe" beauty line. As of
November 3, 2018, the company operated 536 retail stores in the US
and Puerto Rico and generated sales through its e-commerce and
mobile platforms. The company is primarily owned by its former term
loan holders following its February 2018 out-of-court debt
restructuring. Revenue for the twelve month period ended November
3, 2018 was approximately $850 million.
CHARLOTTE RUSSE: S&P Lowers ICR to 'CCC-', Outlook Negative
-----------------------------------------------------------
S&P Global Ratings lowers its issuer credit rating on Charlotte
Russe to 'CCC-' from 'CCC'.
At the same time, S&P is lowering its issue-level rating on the
company's term loan facility to 'CCC-' from 'CCC'. The '3' recovery
rating is unchanged.
S&P said, "The downgrade reflects our view that the likelihood of a
bankruptcy filing or debt restructuring occurring in the next six
months has increased, given our expectation that continued weak
operating performance will increasingly constrain liquidity.
Charlotte Russe also reportedly hired Guggenheim Securities to
explore strategic alternatives.
"The negative outlook on Charlotte Russe reflects our view that
continued weak operating performance and constrained liquidity
could cause the company to announce a bankruptcy or default event
in the next six months. We expect liquidity to further weaken with
meaningfully negative FOCF and shrinking availability under its ABL
revolver over that period.
"We would lower our ratings on Charlotte Russe if the company
announces a distressed exchange or restructuring, or if we believe
that a default is inevitable.
"Although unlikely over the next year, we could raise our ratings
on Charlotte Russe if we believe that the company's operating
performance will improve significantly, enabling it to adequately
fund its business operations and financing expenses on a sustained
basis. In order to raise the ratings, we also need to believe that
its supply-chain disruptions will be minimal."
CHARTER COMMUNICATIONS: Moody's Rates New Sr. Sec. Bonds Ba1
------------------------------------------------------------
Moody's Investors Service assigned a Ba1 rating to the proposed
senior secured bonds of Charter Communications Operating, LLC, a
wholly-owned subsidiary of Charter Communications, Inc. The new
issuance will be of benchmark size and tenor. Proceeds from the
issuance are expected to be used for general corporate purposes,
including share repurchases as well as pre-funding of the company's
$1.25 billion debt maturity in February 2019. Charter's Ba2
Corporate Family Rating and stable outlook remain unchanged.
A summary of the ratings action follows:
Issuer: Charter Communications Operating, LLC
BACKED Senior Secured Regular Bond/Debentures, Assigned at Ba1
(LGD3)
RATINGS RATIONALE
Charter's Ba2 corporate family rating (CFR) is supported by the
company's large scale and moderate leverage. Charter has leading
broadband infrastructure and a high-growing commercial segment. The
company has recently entered into the mobile wireless industry that
now enables them to offer "quad" play bundled packages which
include video, high-speed data, fixed telephony and wireless
telephony services through an MVNO agreement with Verizon
Communications Inc. (Baa1, stable). Moody's anticipates Charter
will grow EBITDA in the mid-single digit range over the next 12
months. Charter's financial policy remains a key driver of the
rating as management has stated that it would like to keep
management calculated net debt-to-EBITDA in the 4.0-4.5x range
(before Moody's adjustments).
The stable outlook reflects its expectation that Charter's
debt-to-EBITDA (incorporating Moody's standard adjustments) will be
sustained below 4.5x over the rating horizon, the company will
continue to generate positive free cash flow and maintain good
liquidity.
Moody's would consider an upgrade of the ratings with continued
improvements in both financial and operating metrics and a
commitment to a better credit profile. Specifically, Moody's could
upgrade the CFR based on expectations for sustained leverage below
4.0x debt-to-EBITDA and free cash flow-to-debt in excess of 5%,
along with maintenance of good liquidity.
A higher rating would require commitment to the stronger credit
metrics, as well as product penetration levels more in line with
industry peers, and growth in revenue and EBITDA per homes passed.
Moody's would likely downgrade ratings if another sizeable debt
funded acquisition, ongoing basic subscriber losses, declining
penetration rates, and/or a reversion to more aggressive financial
policies contributed to expectations for sustained leverage above
4.5x debt-to-EBITDA (including Moody's standard adjustments) or
sustained low single digit or worse free cash flow-to-debt.
One of the largest US domestic cable multiple system operators
serving about 27.9 million customer relationships, 24.9 million
broadband subscribers, 16.6 million video subscribers and 11.2
million voice subscribers, Charter Communications, Inc. maintains
its headquarters in Stamford, Connecticut. Revenue for the last
twelve months ended 9/30/2018 is approximately $43 billion.
CHASRIN INC: Trustee Hires Prager Metis CPA as Accountant
---------------------------------------------------------
Marianne T. O'Toole, chapter 11 trustee of Chasrin Inc., and
Charles Rinaldi, Inc., seeks authority from the U.S. Bankruptcy
Court for the Southern District of New York (White Plains) to
retain Prager Metis CPAs, LLC, as her accountants and financial
advisors, nunc pro tunc to December 28, 2018.
The Trustee requires Prager Metis to:
(a) advise on issues involving the operations of the Debtors
in chapter 11;
(b) meet with management, creditors, owners, contract parties
and other principal parties in the case;
(c) assist with the Trustee's liquidation of any assets of the
estate;
(d) assist the Trustee and counsel in the investigation of the
Debtors' assets and financial affairs and determine whether there
are assets and/or claims that can be administered for the benefit
of the estate and its creditors;
(e) prepare monthly operating reports;
(f) review tax claims; and
(g) perform such other accounting services as may be required
by the Trustee in accordance with her powers and duties as set
forth in the Bankruptcy Code.
PM's current billing rates effective January 1, 2019 are:
Partner/Principal $375 to $475
Manager $295
Staff Accountant $250
Corey H. Neubauer, CPA, member of Prager Metis CPAs LLC, attests
that neither he nor his firm holds or represents any interest which
is adverse to those of the trustee, Debtors or the estate and PM is
a "disinterested person" within the meaning of Sections 101(14) and
327(a) of the Bankruptcy Code.
PM can be reached through:
Corey H. Neubauer, CPA
Prager Metis CPAs LLC
15 Warren Street, Suite 25
Hackensack, NJ 07601
Tel: 201-342-7753
Fax: 201-342-7598
E-mail: Cneubauer@pragermetis.com
About Chasrin Inc.
Chasrin Inc. filed a voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 18-20001) on April
3, 2018. Charles Rinaldi, Inc., filed a Chapter 11 petition
(Bankr. S.D.N.Y. Case No. 18-23343) on Aug. 30, 2018. On Nov. 6,
2018, the Court entered an order directing the joint administration
of the Debtors' cases.
On Nov. 30, 2018, the United States Trustee filed a motion for an
order dismissing the Debtors' case or, alternative, converting the
case to one under Chapter 7.
On Dec. 26, 2018, the Court entered an order directing the
appointment of a Chapter 11 trustee.
On Dec. 27, 2018, the United States Trustee appointed Marianne T.
O'Toole as the Chapter 11 trustee.
Penachio Malara LLP, led by Anne J. Penachio, is the Debtors'
counsel.
CHASRIN INC: Trustee Taps Klestadt Winters as General Counsel
-------------------------------------------------------------
Marianne T. O'Toole, chapter 11 trustee of Chasrin Inc., and
Charles Rinaldi, Inc., seeks authority from the U.S. Bankruptcy
Court for the Southern District of New York (White Plains) to
retain Klestadt Winters Jureller Southard & Stevens, LLP as her
general counsel, nunc pro tunc to December 28, 2018.
The Trustee requires KWJS&S to:
(a) advise on issues involving the operations of the Debtors
in chapter 11;
(b) analyze all agreements between the Debtors and their
lenders, trade vendors, and other creditors, and render advice with
respect to same;
(c) meet with management, creditors, owners, contract parties
and other principal parties in the case;
(d) investigate the Debtors' assets and financial affairs and
determine whether there are assets and/or claims that can be
administered for the benefit of the estates and their creditors;
(e) assist with the Trustee’s liquidation of any assets of
the estate;
(f) review, analyze and respond, as necessary, to all
applications, motions, orders, and statements, and schedules filed
with the Court in this case;
(g) represent the Trustee at all hearings and other
proceedings before this Court or any other court; and
(h) perform such legal services as may be required and/or
deemed to be in the interest of the Trustee in accordance with her
powers and duties as set forth in the Bankruptcy Code.
KWJS&S's hourly rates are:
Tracy L. Klestadt $750
Ian R. Winters $650
John E. Jureller, Jr. $650
Fred N. Stevens $625
Sean C. Southard $625
Joseph C. Corneau $525
Brendan M. Scott $525
Stephanie R. Sweeney $475
Lauren C. Kiss $475
Christopher J. Reilly $375
Andrew Brown $275
Paralegals $175
Fred Stevens, a partner at the law firm known as Klestadt Winters
Jureller Southard & Stevens, attests that KWJS&S is
"disinterested", as that term is defined in section 101(14), as
modified by Section 1107(b) of the Bankruptcy Code.
The counsel can be reached at:
Fred Stevens, Esq.
Christopher Reilly, Esq.
Klestadt Winters Jureller Southard & Stevens, LLP
200 West 41st Street, 17th Floor
New York, NY 10036
Tel: (212) 972-3000
Fax: (212) 972-2245
Email: fstevens@klestadt.com
creilly@klestadt.com
About Chasrin Inc.
Chasrin Inc. filed a voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 18-20001) on April
3, 2018. Charles Rinaldi, Inc., filed a Chapter 11 petition
(Bankr. S.D.N.Y. Case No. 18-23343) on Aug. 30, 2018. On Nov. 6,
2018, the Court entered an order directing the joint administration
of the Debtors' cases.
On Nov. 30, 2018, the United States Trustee filed a motion for an
order dismissing the Debtors' case or, alternative, converting the
case to one under Chapter 7.
On Dec. 26, 2018, the Court entered an order directing the
appointment of a Chapter 11 trustee.
On Dec. 27, 2018, the United States Trustee appointed Marianne T.
O'Toole as the Chapter 11 trustee.
Penachio Malara LLP, led by Anne J. Penachio, is the Debtors'
counsel.
CHINA LIAONING DINGXU: Significant Losses Cast Going Concern Doubt
------------------------------------------------------------------
China Liaoning Dingxu Ecological Agriculture Development, Inc.,
filed its quarterly report on Form 10-Q, disclosing a net loss of
$1,595,400 on $109,159 of net revenues for the nine months ended
September 30, 2018.
At September 30, 2018, the Company had total assets of $6,881,335,
total liabilities of $19,667,859, and $12,786,524 in total
stockholders' deficit.
Daniel Sobolewski, the Company's interim chief executive officer,
said, "The Company historically has experienced significant losses
and negative cash flows from operations. Further, the Company does
not have a revolving credit facility with any financial
institution. These factors raise substantial doubt about the
Company’s ability to continue as a going concern."
The ability of the Company to continue as a going concern is
dependent on raising additional capital, negotiating adequate
financing arrangements and on achieving sufficiently profitable
operations.
A copy of the Form 10-Q is available at:
https://bit.ly/2TUvWq5
China Liaoning Dingxu Ecological Agriculture Development, Inc., is
engaged in growing mushrooms and marketing, producing and selling
mushrooms and related agricultural products. The Dalian,
China-based Company produces and sells three types of products:
fresh mushrooms, mushroom seeds and dried mushrooms.
CHOATES GENERAL: DOJ Watchdog Directed to Appoint Ch. 11 Trustee
----------------------------------------------------------------
Judge Jerrold N. Poslusny, Jr. of the U.S. Bankruptcy Court for the
District of New Jersey orders the United States Trustee to appoint
a Chapter 11 trustee for Choates General Contracting, Inc.
The order was made pursuant to the request of the Acting United
States Trustee, under 11 U.S.C. Sec. 1112(b), to appoint a Chapter
11 trustee for the Debtor.
About Choates General Contracting
Choates General Contracting, Inc., sought protection under Chapter
11 of the Bankruptcy Code (Bankr. D.N.J. Case No. 18-26699) on Aug.
21, 2018. At the time of the filing, the Debtor estimated assets of
less than $50,000 and liabilities in the same range. The case has
been assigned to Judge Jerrold N. Poslusny Jr. Law Offices of
Kasuri Byck, LLC, serves as counsel to the Debtor.
CLYDE EVANS: Seeks Authorization to Use Cash Collateral
-------------------------------------------------------
Clyde Evans Land Company Inc. seeks authority from the U.S.
Bankruptcy Court for the Northern District of Ohio to use cash
collateral in the ordinary course of its business.
At the commencement of this case, the Debtor was indebted to
Superior Federal Credit Union Inc. ("SFCU") in the original amount
of $1.378 million based upon a note executed by the Debtor in favor
of SFCU. At this time, approximately $1.378 million is still owed
on the SFCU Note. The SFCU Note is secured by mortgages and
assignment of rent agreements against certain properties owned by
the Debtor.
The Debtor was also indebted to US Bank National Association as
Trustee for Velocity Commercial Capital Loan Trust 2016- 2 in the
original amount of $1,627,500 pursuant to a note executed by the
Debtor in favor of US Bank. Based upon a default under the US Bank
Note, US Bank obtained a judgment against the Debtor in the amount
of $1,757,659.63. This judgment was entered on July 13, 2018, in
the Lucas County Court of Common Pleas, in case number CI
2018-03071. The US Bank Note is secured by a mortgage and
assignment of rent agreements against certain properties owned by
the Debtor.
The Debtor believes SFCU and US Bank may also claim an interest in
substantially all of the Debtor's personal property, tangible and
intangible, including cash collateral.
The Debtor proposes to use the SFCU Rental Income and US Bank
Rental Income for the following purposes:
(a) Maintenance and preservation of the SFCU Properties and
the US Bank Property;
(b) The continued operation of the Debtor's business,
including, but not limited to, maintenance fees, management fees
and insurance costs for the SFCU Properties and the US Bank
Property as is necessary in the ordinary course;
(c) Payment of real estate taxes upon the SFCU Properties and
the US Bank Property;
(d) Payment of expenses reasonably incurred in the
performance of responsibilities of the Debtor pursuant to the
Rental Agreements between the Debtor and the tenants of the SFCU
Properties and the US Bank Property, including any amendments
thereof;
(e) Payment of reasonable professional fees approved by the
Court;
(f) Payment of trustee fees or commissions as necessary; and
(g) Payment of other incidental overhead expenses concerning
the SFCU Properties and the US Bank Property.
The Debtor proposes that for its use of SFCU's cash collateral,
that SFCU receive the lesser of: (a) the proceeds remaining from
the SFCU Rental Income, as actually received by the Debtor, as
derived from the SFCU Property, after payment of expenses under the
Budget; or (b) the amount to which SFCU is entitled to receive on a
monthly basis under the SFCU Note.
The Debtor also proposes that for its use of US Bank's cash
collateral, that US Bank receive the lesser of (a) the proceeds
remaining from the US Bank Rental Income, as actually received by
the Debtor, as derived from the US Bank Property, after payment of
expenses under the Budget; (b) the amount to which US Bank is
entitled to receive on a monthly basis under the US Bank Note. In
this case, this estimated amount due under the US Bank Note is
$13,095.
The Debtor also offers the following:
(a) In addition to the security interests preserved by
Section 552(b) of the Bankruptcy Code, SFCU and US Bank will be
granted a replacement lien to the same extent, validity and
priority as existed on the Petition Date under the SFCU Assignment
of Rents and SFCU Security Interest and the US Bank Assignment of
Rents and the US Bank Security Interest as of or acquired after the
Petition Date.
(b) Under no circumstance will the Adequate Protection Liens
be subject or subordinate to any lien or security interest arising
on or after the respective Relief Date, or subordinated to or made
pari passu with any other lien, claim or interest under sections
363 or 364 of the Bankruptcy Code or otherwise.
(c) The Debtor will maintain insurance on all its property in
amount which is customarily appropriate for the nature of the
property.
(d) The Debtor will pay and keep current all real estate
taxes which accrue postpetition on its properties.
(e) The Debtor will deposit all income received from its
properties in a Debtor-in-Possession Account, established under
procedures promulgated by the Office of the U.S. Trustee.
(f) The Debtor will, in its Account, maintain a balance of at
least $585, representing the funds available in the Account on the
Petition Date.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/ohnb18-33906-7.pdf
About Clyde Evans Land Co.
Clyde Evans Land Company Inc. owns and operates commercial real
estate properties. The company was incorporated in 1976 and is
based in Lima, Ohio.
Clyde Evans Land Company Inc. filed a voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ohio Case No.
18-33906) on Dec. 18, 2018. In the petition signed by Dave Evans,
president, the Debtor estimated assets of $1 million to $10 million
in assets and liabilities of the same range. The case is assigned
to Judge Mary Ann Whipple. The Debtor is represented by Steven L.
Diller, Esq., at Diller and Rice, LLC.
CLYDE EVANS: Taps Diller and Rice as Legal Counsel
--------------------------------------------------
Clyde Evans Land Company, Inc., received approval from the U.S.
Bankruptcy Court for the Northern District of Ohio to hire Diller
and Rice, LLC, as its legal counsel.
The firm will assist the Debtor in the preparation and
implementation of a plan of reorganization and will provide other
legal services related to its Chapter 11 case.
The firm will charge these hourly fees:
Steven Diller $300
Raymond Beebe $300
Eric Neuman $275
Adam Motycka $185
Prior to its bankruptcy filing, the Debtor paid the firm a retainer
of $10,000.
Diller and Rice does not hold any interest adverse to the Debtor,
creditors or any other "party in interest," according to court
filings.
The firm can be reached through:
Steven L. Diller, Esq.
Diller and Rice, LLC
124 East Main Street
Van Wert, OH 45891
Phone: 419-238-5025
E-mail: Steven@drlawllc.com
About Clyde Evans Land Company
Clyde Evans Land Company, Inc., owns and operates commercial real
estate properties. It was incorporated in 1976 and is based in
Lima, Ohio.
Clyde Evans Land Company sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ohio Case No. 18-33906) on Dec. 18,
2018. At the time of the filing, the Debtor estimated assets of $1
million to $10 million and liabilities of the same range. The case
is assigned to Judge Mary Ann Whipple. Diller and Rice, LLC, is
the Debtor's counsel.
COMMUNITY MEMORIAL: Moody's Affirms Ba2 on $339MM Revenue Bonds
---------------------------------------------------------------
Moody's Investors Service has affirmed Community Memorial Health
System, CA's Ba2 revenue bond rating, affecting $339 million of
rated debt. The outlook remains negative.
RATINGS RATIONALE
Affirmation of the Ba2 rating reflects its expectation that CMHS
will continue to benefit from a number of fundamental strengths,
including strong clinical offerings, an attractive service area, a
solid market position, and an experienced management team.
Furthermore, the newly completed flagship hospital tower, which was
placed into service in December after a several-year delay, is
expected to help drive volume increases, and improve overall
provision of care. Challenges include: very high leverage; a recent
decline in operating performance; reliance on the California State
Provider Fee program; material competition in the greater service
area; and the challenge of operating the new tower profitably while
having to absorb the very significant increase in interest expense
and depreciation. Also, headroom to certain covenants is thin,
increasing the likelihood of covenant violations if operations are
below budget.
RATING OUTLOOK
The maintenance of the negative outlook reflects lower operating
results in fiscal 2017 and 2018, and the expectation that margins
will remain modest (but be on budget) for fiscal 2019. Following
the breach of the organization's rate covenant in 2017 (which at
that time did not constitute an event of default), it is expected
that the organization will be in compliance with all covenants at
FYE 2018, and will remain so going forward. Failure to achieve
operating budgets throughout fiscal 2019, an increased likelihood
of missing a covenant, or a drop in cash that is below
expectations, would likely result in rating pressure.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Sustained improvement in operating performance together will
good revenue growth, and leveling out of balance sheet measures.
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Further deterioration of operating performance and increased
likelihood of violating covenants
- Weakening of market position
- Additional material increase in debt without commensurate
growth in cash flow and liquidity
- Complications involving operating the new hospital
LEGAL SECURITY
Bonds are obligations of the Obligated Group, which consist of
CMHS' two hospitals (Community Memorial Hospital and Ojai Valley
Community Hospital) and constitute 97% of the system's revenue's,
and all of its net assets. Bonds are secured by an interest in the
Obligated Group's gross receivables, and by a deed of trust
covering the majority of Community Memorial's properties, including
both hospitals. Other certain properties are not covered by the
deed of trust, but are subject to a negative pledge, and additional
certain properties are not covered by either the deed of trust or
the negative pledge. Substitution of notes is permitted under
certain conditions.
PROFILE
CMHS is a not-for-profit health system located in Ventura County,
California. The system operates two hospitals, a cancer center, and
eleven community-based clinics. In fiscal 2017, the system
generated over $400 million of operating revenues (inclusive of the
provider fee), and generated nearly 12,000 hospital admissions.
COMPLETE FITNESS: PCO Files 1st Report for Troy Facility
--------------------------------------------------------
Charles J. Taunt, the Patient Care Ombudsman appointed for Complete
Fitness Rehabilitation, Inc., filed a first report for the period
of November 20, 2018 to January 10, 2019.
The Debtor operates a physical therapy practice with central
offices in Troy, Michigan and therapy facilities in Clinton
Township, Warren, Troy and Rochester, Michigan.
A physical inspection of the facility of the Debtor in Troy,
Michigan was made on January 10, 2019. According to the PCO, the
facility was neat, orderly, and businesslike. The PCO added that
the therapy suite at Troy Facility was neat and orderly. At the
time of the visit, no patients were present, but a licensed
physical therapist (PT) and a physical therapist assistant (PTA)
were both on hand.
The PCO concluded that the Debtor appears to have continued the
same quality of care post-petition as pre-petition.
A full-text copy of the First Report is available for free at:
http://bankrupt.com/misc/mieb18-55077-59.pdf
About Complete Fitness Rehabilitation
Complete Fitness Rehabilitation, Inc., filed a voluntary Chapter 11
petition (Bankr. E.D. Mich., Case No. 18-55077) on Nov. 6, 2018,
and is represented by Lynn M. Brimer, Esq., at Strobl & Sharp, PC,
in Bloomfield Hills, Michigan.
Daniel M. McDermott, United States Trustee for Region 9, appoints
Charles J. Taunt as the Patient Care Ombudsman for Complete Fitness
Rehabilitation, Inc., and its affiliates.
CT TECHNOLOGIES: Moody's Raises CFR to Caa2, Outlook Stable
-----------------------------------------------------------
Moody's Investors Service upgraded CT Technologies Intermediate
Holdings, Inc.'s Corporate Family Rating to Caa2 from Caa3 and
Probability of Default Rating to Caa2-PD from Caa3-PD. In addition,
Moody's upgraded rating for the company's $597 million senior
secured first lien term loan due 2021 to Caa1 from Caa3 and
withdrew the existing Caa3 rating for the $35 million senior
secured first lien revolving credit facility expiring December
2019. The outlook remains stable.
"The upgrade follows CIOX Health's extension of its $35 million
revolver as well as the $40 million cash equity infusion from its
sponsor, which resolved its near term refinancing risks and reduced
its liquidity pressures," said Joanna Zeng O'Brien, Moody's analyst
for CIOX Health. "The Caa2 CFR reflects the company's very high
leverage at about 10.2x for the trailing twelve months and our
expectation that any improvement will be slow over the next year.
The Caa2 CFR also reflects its weak interest coverage with
EBITA-to-interest of 0.9x and our expectation of weak liquidity
with negative cash flow for 2019."
Moody's took the following ratings actions:
Issuer: CT Technologies Intermediate Holdings, Inc.
Corporate Family Rating, upgraded to Caa2 from Caa3
Probability of Default Rating, upgraded to Caa2-PD from Caa3-PD
$35 million senior secured first lien revolving credit facility
expiring December 2019, withdrew Caa3 (LGD3)
$597 million ($578 million outstanding) senior secured first lien
term loan due 2021, upgraded to Caa1 (LGD3) from Caa3 (LGD3)
Outlook: remains stable
RATINGS RATIONALE
CIOX Health's Caa2 CFR broadly reflects its very high financial
leverage with LTM as of September 30, 2018 Moody's adjusted
debt-to-EBITDA of about 10.2x, its weak liquidity profile with
negative free cash flow and reliance on its revolver, as well as
its modest size and narrow business focus providing medical
information exchange management and retrieval services. The rating
is also constrained by CIOX Health's deteriorating operating
performance and continued pricing pressure due to federal
regulations, legal and reputational risks associated with the
release of protected health information, as well as event risks
associated with private equity ownership. However, the rating is
supported by the company's established position in the medical
information exchange management and retrieval industry, contracts
with a large number of US hospitals, as well as relatively high
although declining retention rates at about 92%.
The stable outlook reflects Moody's expectation that leverage will
continue to be very high and improvement will be slow over the next
12 to 18 months. It also reflects Moody's expectation for weak
liquidity profile with negative free cash flow in 2019 but the
company will have sufficient revolver availability and cash on
balance sheet to fund its operations and mandatory debt
amortization.
The ratings could be downgraded if operating performance and
liquidity deteriorates further and ensuing default risk rises,
including through a distressed exchange.
The ratings could be upgraded if the company is able to improve
revenue, earnings, and liquidity profile.
The principal methodology used in these ratings was Business and
Consumer Service Industry methodology published in October 2016.
CIOX Health, headquartered in Alpharetta, GA, is a large provider
of healthcare information services and technology solutions to
hospitals, health systems, physician practices and authorized
recipients of protected health records in the United States. The
affiliates of New Mountain Capital, LLC own and control CIOX
Health. LTM revenue as of September 30, 2018 was $624 million.
CYN RESTAURANTS: Unsecureds to Recoup 25% Under Latest Plan
-----------------------------------------------------------
Cyn Restaurants, LLC, filed with the U.S. Bankruptcy Court for the
District of Connecticut its first amended disclosure statement
explaining its proposed chapter 11 plan of reorganization.
Under the latest plan, the Debtor will pay Class 2 general
unsecured creditors 25% of their allowed claims over a period of 84
months with payments commencing 60 days after the effective date of
the plan. The total monthly payment amount would equal $119 for the
entire class paid at least on a quarterly basis. Payments will
commence 60 days after the effective date of the plan.
The initial plan proposed to pay general unsecured creditors only
15% of their allowed claims with monthly payment of $198.26.
A copy of the First Amended Disclosure Statement is available at
https://tinyurl.com/y8gjgqjp from Pacermonitor.com at no charge.
About Cyn Restaurants
Based in Shelton, Connecticut, Cyn Restaurants LLC is engaged in
the business of the operation of a restaurant known as Stone's
Throw located at 337 Roosevelt Drive, Seymour, CT.
Cyn Restaurants filed a Chapter 11 petition (Bankr. D. Conn. Case
No. 18-30185) on Feb. 5, 2018. In the petition signed by Peter
Hamme, the Debtor estimated $100,000 to $500,000 in assets and
$500,001 to $1 million in liabilities. James M. Nugent, Esq., at
Harlow, Adams & Friedman, P.C., is the Debtor's counsel; and Sound
Coaching, Inc., as its accountant.
DESERT LAND: Sher Creditors Seek Rejection of Amended Plan Outline
------------------------------------------------------------------
The Sher Creditors filed an objection to Desert Land, LLC and
affiliates' amended disclosure statement in support of their
amended joint plan of reorganization.
The Sher Creditors complain that the Debtors' Amended Disclosure
proposes only cosmetic changes to address the serious concerns
raised by nearly every creditor constituency in the case. With
respect to the Sher Creditors in particular, the Amended Disclosure
Statement ignores almost every issue raised in the Sher Creditors'
Initial Objection. Thus, the Court should deny approval of the
Amended Disclosure for the same reasons as already set forth in the
Initial Objection.
Moreover, Debtors are relying on a sale of their real property
holdings to a single buyer for an amount that pays all creditors in
full. While creditors certainly would welcome such a result,
Debtors have given no reason to believe it can be achieved and the
current Amended Plan does nothing more than buy Debtors a year-long
delay in the hope that a sale might materialize. Creditors need to
know what happens if the promise of a sale is not fulfilled, and
specifically with regard to the Sher Creditors, what Debtors plan
to do to account for both the pending litigation between the Sher
Creditors and Debtor Desert Land and the Sher Creditors’
unsecured claims for almost $1 million. In addition, all creditors
need a complete and accurate picture of the Debtors’ assets, the
past (and recent) history of failed sale attempts, a clear
understanding of the alternatives in a “meltdown” scenario, and
an explanation of what efforts will be undertaken to collect on the
$50 million in receivables due to Desert Land from its insiders and
affiliates. This information is nowhere to be found in the Amended
Disclosures. Approval of the Amended Disclosure should be denied on
these grounds as well.
In their Initial Objection to Debtors' Disclosure Statement, the
Sher Creditors raised three issues that without remedy would
prevent confirmation of the Debtors' proposed plan of
reorganization as a matter of law: (1) the exculpation and release
of insiders and affiliates of Debtors; (2) the violation of the
absolute priority rule; and (3) Debtors' end run around the Court's
denial of substantive consolidation. Debtors have failed to address
these issues in their Amended Disclosure and failed to make any
substantive changes in the Amended Plan to rectify these fatal
defects. Because Defendants are still proposing a facially
non-confirmable plan, approval of the Amended Disclosure Statement
should be denied.
A copy of the Sher Creditors' Objection is available at:
http://bankrupt.com/misc/nvb18-12454-393.pdf
The Troubled Company Reporter previously reported that the Debtors
will attempt to sell the Desert Land Property through negotiated
sale to an unrelated buyer using the services of Colliers
International. If, within the Primary Sales Period no sale is
negotiated, the Debtors will arrange for a final sale of the
Property at which the secured creditors will be permitted to credit
bid on their collateral.
A full-text copy of the Disclosure Statement dated Nov. 27, 2018,
is available at:
http://bankrupt.com/misc/nvb18-1812454gs-337.pdf
Attorneys for the Sher Creditors:
Michael N. Feder, Esq.
Joel Z. Schwarz, Esq.
Gabriel Blumberg, Esq.
DICKINSON WRIGHT PLLC
8363 West Sunset Road, Suite 200
Las Vegas, Nevada 89113-2210
Tel: (702) 550-4400
Fax: (844) 670-6009
Email: mfeder@dickinson-wright.com
jschwarz@dickinson-wright.com
gblumberg@dickinson-wright.com
About Desert Land
On April 30, 2018, Tom Gonzales commenced an involuntary petition
for relief under Chapter 7 of the Bankruptcy Code against Desert
Land, LLC. The petitioning creditor was Bradley J. Busbin, as
trustee of the Gonzales Charitable Remainder Unitrust One. Jamie
P. Dreher -- jdreher@downeybrand.com -- of Downey Brand LLP
represents the Trustee.
Desert Land and its affiliates sought and obtained the conversion
of the case to a case under Chapter 11 on June 28, 2018 (Bankr. D.
Nevada, Lead Case No. 18-12454). The Debtor's affiliates are
Desert Oasis Apartments LLC, Desert Oasis Investments, LLC, and
Skyvue Las Vegas LLC.
Schwartzer & McPherson Law Firm serves as the Debtors' counsel.
DIGICEL GROUP: Fitch Upgrades Issuer Default Rating to CCC
----------------------------------------------------------
Fitch Ratings has upgraded the Issuer Default Ratings (IDR) of
Digicel Group Limited (DGL) to 'CCC-' from 'RD', Digicel Limited
(DL) to 'B-'/Outlook Stable from 'CCC'/Rating Watch Negative (RWN),
and Digicel International sFinance Limited (DIFL) to 'B'/Outlook
Stable from 'CCC+'/RWN. At the same time, Fitch has assigned new
IDRs to Digicel Group One Limited (DGL1) of 'B-'/Stable and to
Digicel Group Two Limited (DGL2) of 'CCC-'.
The recently completed debt restructuring involved the creation of
two new intermediate holding companies, DGL1 and DGL2, between DL
and DGL. 96.9% of DGL 8.25% notes due 2020 are being exchanged for
8.25% notes due 2022, issued out of both DGL1 and DGL2. 97.9% of
DGL 7.125% notes due 2022 are being exchanged for 9.125% cash/PIK
notes due 2024, issued out of DGL2. In the new corporate structure,
DIFL and DL creditors are structurally senior to DGL1 noteholders,
who are in turn structurally senior to DGL2 noteholders; holdout
DGL noteholders have junior ranking to all creditors.
KEY RATING DRIVERS
Weak Parent Subsidiary Linkages: While operational and strategic
links exist, structural and legal differences between the issuers
and their obligations have resulted in multiple rating levels. DL's
debt has a subordinate guarantee from DIFL; however, no such
guarantee exists for DGL1, DGL2 and DGL. Finally, the covenants
place certain restrictions on the group's ability to move cash
upstream.
Group Structure Drives Ratings: DIFL's debt is secured by the
company's operating assets in the Caribbean, which account for over
80% of the group's consolidated EBITDA, while DL has second claim
on the Caribbean assets and cash flows. Fitch expects leverage of
1.8x at DIFL and 4.5x at DL, unchanged from the pre-exchange
ratios. DGL1, rated the same as DL, solely benefits from a priority
claim on the group's Pacific assets and cash flow, and residual
cash flows from DL. Fitch forecasts leverage of 4.9x at DGL1 for
2018.
Fitch forecasts recovery rates commensurate with 'RR1', 'RR2' and
'RR3' for DIFL, DL and DGL1 creditors, respectively. Fitch caps
Digicel's debt instruments at 'RR4' due to weak creditor
protections in the countries of operation; therefore, the
instruments' ratings are capped at the issuers' IDRs. Fitch
forecasts consolidated leverage of 6.9x for DGL2 and DGL, and below
average recovery prospects for their bonds, which have been rated
'CC/RR5.'
Distressed Debt Exchange: The exchange reflects the controlling
shareholder's willingness to restructure debt rather than seeking
additional equity or expediting asset sales. Furthermore, the terms
of the exchange, particularly in regards to the subordination of
2022 noteholders is viewed as a negative from a governance
standpoint. These moves have undermined the group's position with
creditors and will result in higher refinancing costs at all
levels. While the restructuring has afforded the group extra time
to monetize assets, the amortization profile still features
significant maturities starting in 2021.
Persistently High Leverage: Since fiscal 2015, the group's
consolidated leverage has increased to 6.9x from 5.3x, due to
negative FCF generation caused by high capex, amid revenue
contraction. As the debt restructuring did not involve a principal
reduction or additional equity, it is critical that the company
improve its stagnant operational performance. Fitch expects a
modest decline in leverage metrics, as capital intensity falls and
shareholder distributions cease; however, Fitch forecasts nominal
revenue growth to be offset by dollar appreciation.
Strong Business Profile: Many of Digicel's business operate in
duopoly markets where their market share exceeds 50%. Pricing is
expected to remain rational in the near term and Fitch does not
believe the risk of a sizable new entrant to be high, given the
relatively small size of each market amid mobile maturity. Under
this environment, Fitch expects the company's competitive position
to remain stable over the medium term. Digicel's high investment
for network upgrades should enhance network competitiveness in the
coming years.
DERIVATION SUMMARY
Digicel's solid business profile, with leading mobile market shares
in its well-diversified operational geographies supported by
network competitiveness, is considerably stronger than its highly
speculative peers. However, Digicel's financial profile is
materially weaker than its regional diversified telecom peers in
the speculative-grade rating categories, including Millicom
International (BB+), and Cable & Wireless (BB-).
Parent/subsidiary linkages are weak; therefore, DGL and DGL2's IDRs
are lower than DGL1, DL, and DIFL's. The stronger subsidiaries have
been rated somewhat higher than the consolidated credit profile.
Historically, Fitch equalized the IDRs of the group, based on the
assessment of the linkages between the companies. However,
following the company's debt restructuring and corporate
reorganization, Fitch has de-emphasized the importance of the
operational ties between entities, and views the legal ties as
weak, which allows the group to default on structurally weaker
entities and remain current on structurally stronger ones.
No country ceiling or operating environment influence was in effect
for the ratings.
In Fitch's country-specific treatment of Recovery Ratings, Fitch
caps Digicel's debt instruments at 'RR4'; therefore, the
instruments' ratings are capped at the issuers' IDRs.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Muted overall revenue growth, as solid broadband and business
to business growth are offset by weak growth prospects for the
mobile segment;
- Continued appreciation of the U.S. dollar against the local
currencies in most of Digicel's countries of operation;
- Benefits from the restructuring program to increase EBITDA
margins by 1%-2% in the near term;
- No dividend payments to controlling shareholder.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
- A positive rating action is unlikely, barring a material
improvement in operating performance, and/or debt reduction.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
- Deterioration of operating performance in key markets, along
with an increase in consolidated leverage, and/or lower refinancing
prospects as maturities draw nearer.
LIQUIDITY
Weak Liquidity: Fitch considers the group's liquidity to be
inadequate given the small cash cushion relative to debt burden and
the persistently negative FCF. Interest expenses are expected to
continue consuming most of operating income. As of Sept. 30, 2018,
Digicel had USD258 million of readily available cash and
equivalents, compared with USD241 million of current debt and
accrued interest.
While the debt exchange extends the group's maturity profile, it
did not include principal reductions or additional equity capital.
The company still faces significant debt maturities in each
calendar year from 2021 through 2023.
FULL LIST OF RATING ACTIONS
Digicel International Finance Limited
- IDR Upgraded to 'B'/Stable from 'CCC+'; removed Rating Watch
Negative;
- Secured facilities Upgraded to 'B'/'RR4' from 'CCC+'/'RR4';
removed Rating Watch Negative.
Digicel Limited
- IDR Upgraded to 'B-'/Stable from 'CCC'; removed Rating Watch
Negative;
- 2021 & 2023 Notes Upgraded to 'B-'/'RR4' from 'CCC-'/'RR4';
removed Rating Watch Negative.
Digicel Group One Limited
- Assigned IDR of 'B-'/Stable;
- 2022 Notes: Assigned new rating of 'B-'/'RR4'.
Digicel Group Two Limited
- Assigned new IDR of 'CCC-';
- 2022 & 2024 Notes: Assigned new rating of 'CC'/'RR5'.
Digicel Group Limited
- IDR Upgraded to 'CCC-' from 'RD';
- Remaining 2020 & 2022 Notes: Upgraded to 'CC'/'RR5' from
'C'/'RR5'.
DPW HOLDINGS: Amends Form 8-K Report to Provide Update on SPA
-------------------------------------------------------------
DPW Holdings, Inc., has filed an amendment to its Form 8-K
originally filed with the Securities and Exchange Commission on
Dec. 8, 2018. Its sole purpose is to include that the Company has
exceeded the cure period provided in Amendment No. 9 dated Dec. 7,
2018, but is continuing to pay the Holder on a frequent basis and
Holder has not exercised any rights under relevant documents.
On May 15, 2018, the Company entered into a Securities Purchase
Agreement with an institutional investor providing for the issuance
of (i) a Senior Secured Convertible Promissory Note with a
principal face amount of $6,000,000, which Convertible Note (as
amended on Aug. 31, 2018) is, subject to certain conditions,
convertible into 15,000,000 shares of Common Stock of the Company
at $0.40 per share; (ii) a five-year warrant to purchase 1,111,111
shares of Common Stock at an exercise price of $1.35; (iii) a
five-year warrant to purchase 1,724,138 shares of Common Stock at
an exercise price of $0.87 per share; and (iv) 344,828 shares of
Common Stock.
On July 2, 2018, the Company and the Investor entered into an
agreement, among other things, to amend the May SPA and the May
Note pursuant to the terms and subject to the conditions set forth
in Amendment No. 3 Agreement and Amendment No. 4 Agreement.
On Aug. 31, 2018, the Company and the Investor entered into an
amendment, among other things, to further amended the May SPA and
the May Note, pursuant to the terms and subject to the conditions
set forth in Amendment No. 5 Agreement and Amendment No. 6
Agreement.
The Company and the Investor further amended the May Note, among
other things, pursuant to the terms and subject to the conditions
set forth in Amendment No. 7 Agreement.
The Company and the Investor further amended the May Note, among
other things, pursuant to the terms and subject to the conditions
set forth in Amendment No. 8 Agreement.
On Dec. 7, 2018, the Company and the Investor entered into the
Amendment No. 9 Agreement, which further amends the amortization
schedule of the May Note. Commencing on Jan. 2, 2019, and
continuing every month thereafter, on the first business day of
such month for a period of 12 months, the Company shall redeem the
principal amount, plus accrued but unpaid interest, for twelve (12)
months, in accordance with the terms and subject to the conditions
set forth in the Amendment. In addition, each Amortization Payment
shall be made in cash or Bitcoin in the amounts set forth in the
Amendment.
Pursuant to the terms and subject to the conditions set forth in
the Amendment, the Investor has the option to request the December
Payment and/or the January Payment to be made either (i) in the
form of shares of the Company's common stock, provided, that there
is an effective registration statement covering such shares, or
(ii) in cash via wire transfer, or alternatively in Bitcoin, in
accordance with the terms of the May Note. Upon the sale of the
Payment Shares, the Investor's daily sales shall not exceed fifteen
percent (15%) of the total number of shares of the Company's common
stock traded on that day. Further, in the event that the sale of
the Payment Shares does not net to the Investor proceeds at least
equal to 103% of the amount of the December Payment and the January
Payment, respectively, upon request of the Investor, the Company
shall pay the difference to the Investor in cash.
Among other things, Amendment No. 9 provided the Company with a
cure period of seven Trading Days on any Amortization and true up
Payment due. The Company has exceeded the cure period provided in
Amendment No. 9, but is continuing to pay the Holder on a frequent
basis and Holder has not exercised any rights under relevant
documents.
About DPW Holdings
DPW Holdings, Inc., formerly known as Digital Power Corp. --
http://www.DPWHoldings.com/-- is a diversified holding company
pursuing growth by acquiring undervalued businesses and disruptive
technologies that hold global potential. 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. In
addition, the company owns a select portfolio of commercial
hospitality properties and extends credit to select entrepreneurial
businesses through a licensed lending subsidiary. DPW Holdings,
Inc.'s headquarters is located at 201 Shipyard Way, Suite E,
Newport Beach, CA 92663.
DPW Holdings incurred a net loss of $10.89 million in 2017
following a net loss of $1.12 million in 2016. As of Sept. 30,
2018, the Company had $53.10 million in total assets, $25 million
in total liabilities, and $28.09 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.
DPW HOLDINGS: Signs 10-Day Forbearance Agreement with Calgary
-------------------------------------------------------------
DPW Holdings, Inc., has filed with the Securities and Exchange
Commission an amendment to its Form 8-K originally filed with the
Securities and Exchange Commission on Jan. 7, 2019. Its sole
purpose is to include that the Company has executed a term sheet
which sets forth the terms and conditions of a forbearance
agreement in connection with two unsecured Promissory Notes dated
Oct. 10, 2018, and Nov. 29, 2018, which were issued to Cavalry Fund
I LP.
On Jan. 10, 2019, the Company executed a term sheet which sets
forth a summary of terms and conditions of a forbearance agreement
with Cavalry Fund I LP, pursuant to which, for a period of 10
trading days, Cavalry will not exercise its right to foreclose on
certain outstanding notes issued by the Company on Oct. 10, 2018,
and Nov. 29, 2018. The Company is highly confident that the
parties will come to a final definitive agreement within the
10-trading-day period.
On Oct. 10, 2018 and Nov. 29, 2018, respectively, DPW Holdings,
Inc. issued two unsecured Promissory Notes to Cavalry Fund I LP.
The Company received a notice of default from Cavalry on Dec. 21,
2018 contending that the October Note was in default because (i)
the Company had not repaid the October Note by Dec. 8, 2018 and
(ii) of certain other events of default related to the November
Note. Cavalry stated in the Notice that it will commence
litigation against the Company unless it has been paid the sum of
$888,150 plus interest by Dec. 31, 2018.
Prior to receipt of the Notice from Cavalry, the Company was
attempting to reach a negotiated settlement with Cavalry.
Notwithstanding receipt of the Notice, the Company hopes to
continue to work with Cavalry to settle its obligations under the
Cavalry Note. The Company intends to vigorously defend its
position should a mutually amicable resolution prove unattainable.
About DPW Holdings
DPW Holdings, Inc., formerly known as Digital Power Corp. --
http://www.DPWHoldings.com/-- is a diversified holding company
pursuing growth by acquiring undervalued businesses and disruptive
technologies that hold global potential. 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. In
addition, the company owns a select portfolio of commercial
hospitality properties and extends credit to select entrepreneurial
businesses through a licensed lending subsidiary. DPW Holdings,
Inc.'s headquarters is located at 201 Shipyard Way, Suite E,
Newport Beach, CA 92663.
DPW Holdings incurred a net loss of $10.89 million in 2017
following a net loss of $1.12 million in 2016. As of Sept. 30,
2018, the Company had $53.10 million in total assets, $25 million
in total liabilities, and $28.09 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.
DURR MECHANICAL: Hires Grassi & Co. as Financial Advisor
--------------------------------------------------------
Durr Mechanical Construction, Inc., seeks authority from the United
States Bankruptcy Court for the Southern District of New York
(Manhattan) to hire Grassi & Co. as financial advisors to the
Debtor, effective nunc pro tunc to December 7, 2018.
The professional services that Grassi will render are:
a. assist in the preparation and review of all budgets and
financial analyses required in the Debtor's case;
b. assist in the preparation and review of monthly operating
reports;
c. assist in the preparation and review of any reports
required by the Debtor's secured lenders and surety;
d. assist in the formulation of a Chapter 11 Plan;
e. assist in the preparation and review of the Debtor's
required federal and state income tax returns; and
f. assist with such other matters as the Debtor or its counsel
may request from time to time.
Steven Goldstein, CPA, partner at Grassi & Co., attests that his
firm is a "disinterested person" within the meaning of sections
101(14) and 327(a) of the Bankruptcy Code as such term is
understood by the Debtor.
Grassi's usual hourly rates are:
Partners $450 - $475
Managers/Supervisors $270 - $325
Staff Accountants/ Bookkeepers $165 - $230
Support Staff $140 - $180
The advisor can be reached through:
Steven Goldstein, CPA, PFS
Grassi & Co.
488 Madison Avenue, 21st Floor
New York, NY 10022
Phone: 212-661-6166
Fax: 212-755-6748
Email: sgoldstein@grassicpas.com
About Durr Mechanical
Durr Mechanical Construction, Inc. -- http://www.durrmech.com/--
is a mechanical contracting company headquartered in New York. It
offers commercial HVAC, scheduling and cost control, BIM drafting,
erecting and setting equipment, process piping, power piping, and
emergency services.
Durr Mechanical Construction filed a voluntary petition for
reorganization under Chapter 11 of Title 11 of the United States
Code (Bankr. S.D.N.Y. Case No. 18-13968) on Dec. 7, 2018. In the
petition signed by Kenneth A. Durr, president, the Debtor estimated
$100 million to $500 million in assets and $50 million to $100
million in liabilities. LaMonica Herbst & Maniscalco, LLP, led by
Michael Thomas Rozea, and Adam P. Wofse, serve as counsel to the
Debtor.
DURR MECHANICAL: Hires LaMonica Herbst & Maniscalco as Counsel
--------------------------------------------------------------
Durr Mechanical Construction, Inc., seeks authority from the United
States Bankruptcy Court for the Southern District of New York
(Manhattan) to hire LaMonica Herbst & Maniscalco, LLP, as its
counsel, effective nunc pro tunc to Dec. 7, 2018.
The professional services that LHM is to render are:
(a) to provide legal advice with respect to the Debtor's
powers and duties as a debtor-in-possession in accordance with the
provisions of the Bankruptcy Code in the continued operation of its
business;
(b) to prepare, on behalf of the Debtor, all necessary
schedules, applications,motions, answers, orders, reports,
adversary proceedings and other legal documents required by the
Bankruptcy Code and Federal Rules of
Bankruptcy Procedure;
(c) to perform all other legal services for the Debtor that
may be necessary in connection with the Debtor's attempt to
reorganize its affairs under the Bankruptcy Code; and
(d) to assist the Debtor in the development and
implementation of a plan of reorganization.
LHM's current hourly rates are:
Partners $425 to $595
Associates $300 to $415
Para-professionals $175
Adam P. Wofse, a partner at the firm, attests that LHM is a
"disinterested person" as that term is defined in Sec. 101(14) of
the Bankruptcy Code.
The counsel can be reached through:
Adam P. Wofse, Esq.
LAMONICA HERBST & MANISCALCO, LLP
3305 Jerusalem Avenue, Suite 201
Wantagh, NY 11793
Tel: (516) 826-6500
Fax: (516) 826-0222
Email: awofse@lhmlawfirm.com
About Durr Mechanical
Durr Mechanical Construction, Inc. -- http://www.durrmech.com/--
is a mechanical contracting company headquartered in New York. It
offers commercial HVAC, scheduling and cost control, BIM drafting,
erecting and setting equipment, process piping, power piping, and
emergency services.
Durr Mechanical Construction filed a voluntary petition for
reorganization under Chapter 11 of Title 11 of the United States
Code (Bankr. S.D.N.Y. Case No. 18-13968) on Dec. 7, 2018. In the
petition signed by Kenneth A. Durr, president, the Debtor estimated
$100 million to $500 million in assets and $50 million to $100
million in liabilities. LaMonica Herbst & Maniscalco, LLP, led by
Michael Thomas Rozea, and Adam P. Wofse, serves as counsel to the
Debtor.
DURR MECHANICAL: Taps Shipman & Goodwin as Special Counsel
----------------------------------------------------------
Durr Mechanical Construction, Inc., received approval from the U.S.
Bankruptcy Court for the Southern District of New York to hire
Shipman & Goodwin LLP as special counsel.
The firm will provide legal services to the Debtor in connection
with an arbitration proceeding pending before the American
Arbitration Association against Enexio US, LLC.
Shipman charges these hourly fees:
Robert O'Brien Partner $500
Laurann Asklof Partner $475
Andrea Gomes Associate $340
Robert O'Brien, Esq., a partner at Shipman, disclosed in a court
filing that the firm and its attorneys neither hold nor represent
any interest adverse to the Debtor.
The firm can be reached through:
Robert J. O'Brien, Esq.
Shipman & Goodwin LLP
One Constitution Plaza
Hartford, CT 06103-1919
Phone: (860) 251-5789 / (860) 251-5000
Fax: (860) 251-5099
Email: robrien@goodwin.com
About Durr Mechanical
Durr Mechanical Construction, Inc. -- http://www.durrmech.com/--
is a mechanical contracting company headquartered in New York. It
offers commercial HVAC, scheduling and cost control, BIM drafting,
erecting and setting equipment, process piping, power piping, and
emergency services.
Durr Mechanical Construction filed a voluntary petition for
reorganization under Chapter 11 of Title 11 of the United States
Code (Bankr. S.D.N.Y. Case No. 18-13968) on Dec. 7, 2018. In the
petition signed by Kenneth A. Durr, president, the Debtor estimated
$100 million to $500 million in assets and $50 million to $100
million in liabilities. LaMonica Herbst & Maniscalco, LLP, led by
Michael Thomas Rozea, and Adam P. Wofse, serves as the Debtor's
counsel.
DYNAMIC MRI: Unsecureds to Get 10% of Allowed Claims in 60 Months
-----------------------------------------------------------------
Dynamic MRI & 3D CT CSP filed a small business disclosure statement
in connection with its proposed plan of reorganization.
Dynamic MRI has been providing radiology services to the area of
Guaynabo, Puerto Rico since its inception in 2009.
Class 3 under the plan consists of general unsecured creditors.
After reconciling the claims, the Debtor estimates that the claims
under this class is $445,785.13. Members of this class will receive
10% of their allowed claims in equal monthly installments to be
paid within 60 months.
The proposed plan will be funded with income obtained from the
operations of the Debtor, an overpayment with Hacienda, insurance
proceeds from Hurricane Maria and collection of Accounts
Receivables.
A copy of the Disclosure Statement is available at
https://tinyurl.com/ybtfklej from Pacermonitor.com at no charge.
About Dynamic MRI & 3D CT CSP
Dynamic MRI & 3D CT CSP sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. P.R. Case No. 18-02525) on May 7, 2018.
In the petition signed by its president, Manuel R. Prats, the
Debtor estimated assets of less than $1 million and liabilities of
less than $1 million. Judge Enrique S. Lamoutte Inclan presides
over the case. The Debtor is represented by Carmen D. Conde Torres,
Esq. of C. Conde & Associates.
EDWARD'S BODY: Seeks to Hire Orshan as Legal Counsel
----------------------------------------------------
Edward's Body Shop & Auto Repair, Inc., seeks approval from the
U.S. Bankruptcy Court for the Southern District of Florida to hire
Orshan, P.A., as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; assist in the negotiation of financing agreements;
prepare a plan of reorganization; assist the Debtor in any
potential disposition of its assets; and provide other legal
services related to its Chapter 11 case.
Orshan charges these hourly fees:
Paul Orshan, Esq. $475
Associate Attorney $250
Paralegal $125
The Debtor paid the firm a pre-bankruptcy retainer of $17,000.
Paul Orshan, the firm's founding partner, disclosed in a court
filing that his firm does not have any interest adverse to the
Debtor's bankruptcy estate, creditors and equity security holders.
The firm can be reached through:
Paul L. Orshan, Esq.
Orshan, P.A.
701 Brickell Avenue, Suite 2000
Miami, FL 33131
Tel: 305-529-9380
Fax: 305-402-0777
E-mail: paul@orshanpa.com
About Edward's Body Shop
Edward's Body Shop & Auto Repair, Inc., is a privately-held company
in Miami, Florida, that provides automotive repair and maintenance
services. It was incorporated in 1986.
Edward's Body Shop & Auto Repair sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-10172) on Jan.
6, 2019. At the time of the filing, the Debtor estimated assets
of $1 million to $10 million and liabilities of less than $1
million. The case is assigned to Judge Jay A. Cristol. Orshan,
P.A., is the Debtor's counsel.
EQUINOX HOME: Has Until May 30 to Exclusively File Chapter 11 Plan
------------------------------------------------------------------
The Hon. Julie A. Manning of the U.S. Bankruptcy Court for the
District of Connecticut, at the behest of Equinox Home Care, LLC,
has extended the exclusive time period within which the Debtor may
file its Plan and Disclosure Statement to May 30, 2019, as well as
the exclusive period within which the Debtor may solicit
acceptances and obtain approval of its Plan to July 29, 2019.
About Equinox Home Care
Equinox Home Care, LLC, is in the business of home health care
services. Equinox Home Care filed a Chapter 11 bankruptcy petition
(Bankr. D. Conn. Case No. 18-51009) on Aug. 3, 2018.
In the petition signed by Theresa Foreman, manager/member, the
Debtor estimated less than $50,000 in assets and $100,001 to
$500,000 in debt. The Debtor tapped James M. Nugent, Esq., at
Harlow Adams and Friedman, as its legal counsel.
EXCHANGE AVENUE: Taps Energynet.com as Auctioneer
-------------------------------------------------
Exchange Avenue Production Co. received approval from the U.S.
Bankruptcy Court for the Northern District of Texas to hire
Energynet.com, Inc.
The firm will conduct an auction of the working interest held by
the Debtor in certain wells located in Winkler County, Texas.
Energynet.com's commission ranges from 10% for property sold for
$100,000 or less, to 2.25% for property sold for more than $5
million. The firm would be entitled to a minimum listing fee of
$300 in the event an item does not sell in the online auction.
Chris Atherton, president of Energynet.com, disclosed in a court
filing that the firm does not have any interest adverse to the
Debtor's bankruptcy estate.
The firm can be reached through:
Chris Atherton
Energynet.com, Inc.
7201 I-40 West, Suite 319
Amarillo, TX 79106
Toll Free: 1-877-351-4488
Phone: (806) 351-2953
Fax: (806) 354-2835
Email: energy@energynet.com
About Exchange Avenue Production
Exchange Avenue Production Co. is a privately held company in
Weatherford, Texas, engaged in oil and gas extraction business.
The Debtor sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Tex. Case No. 17-44107) on Oct. 4, 2017. In the
petition signed by Linda Hunt, partner, the Debtor estimated assets
of $1 million to $10 million and liabilities of less than $1
million. Judge Mark X. Mullin presides over the case. The Debtor
hired Forshey & Prostok, LLP, as its legal counsel; Kelly Hart &
Hallman LLP, as special counsel; and Freemon, Shapard & Story as
its accountant.
FIRELANDS GROUP: Seeks March 31 Exclusive Filing Period Extension
-----------------------------------------------------------------
The Firelands Group, LLC, requests the U.S. Bankruptcy Court for
the Central District of Illinois to extend the exclusive periods in
which the Debtor may file a plan of reorganization and solicit
acceptances by 60 days to March 31, 2019 and May 31, 2019,
respectively.
The Debtor tells the Court that its representatives have had
ongoing calls and meetings with Hickory Point Bank and Trust (the
secured creditor) and HobbyTown USA (the key customer) in recent
weeks in an effort to settle the various claims by and among them.
The parties continue to educate one another on their respective
positions.
Although it is encouraged by the ongoing settlement talks, the
Debtor believes that it is in the best interest of the estate and
all parties to seek a short extension of the exclusive periods in
which it may file a plan of reorganization and seek acceptances.
Additionally, the claims bar date is Jan. 29, 2019.
About The Firelands Group
The Firelands Group, LLC, sells remotely controllable model
vehicles, quadcopter and wireless drone cameras. It is an Illinois
limited liability company with its principal place of business in
Champaign, Illinois.
The Firelands Group sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Ill. Case No. 18-90996) on Oct. 2,
2018. In the petition signed by Michael Gillette, manager, the
Debtor disclosed $1,125,741 in assets and $2,815,399 in
liabilities. Judge Mary P. Gorman oversees the case. The Debtor
tapped Taft Stettinius & Hollister LLP as its legal counsel.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on Oct. 25, 2018. The committee tapped Akerman
LLP as its legal counsel.
GARY REED ENTERPRISES: Taps Yaeger Treviso as Accountant
--------------------------------------------------------
Gary Reed Enterprises, Inc., received approval from the U.S.
Bankruptcy Court for the Western District of New York to hire
Yaeger, Treviso & Associates, Inc., as its accountant.
The firm will assist the Debtor in the preparation of its monthly
operating reports, tax returns and bankruptcy plan, and will
provide other accounting services related to its Chapter 11 case.
Yaeger will charge these hourly fees:
Charles Treviso $250
Ann Lazarro $150
Other Staff $75 - $100
The firm does not hold any interest adverse to the Debtor's
bankruptcy estate, according to court filings.
The firm can be reached through:
Charles Treviso
Yaeger, Treviso & Associates, Inc.
661 Ridge Road
P.O. Box 1495
Webster, NY 14580
Phone: (585) 671-1130
Fax: (585) 671-4417
About Gary Reed Enterprises
Gary Reed Enterprises Inc., operator of a chain of eight Hair Zoo
hair salons in the Rochester, New York area, sought Chapter 11
protection (Bankr. W.D.N.Y. Case No. 18-20869) on Aug. 21, 2018.
In the petition signed by Gary Reed, Sr., president, the Debtor
estimated $1 million to $10 million in assets and liabilities. The
Hon. Warren, U.S.B.J., oversees the case. David L. Rasmussen,
Esq., at Davidson Fink, LLP, serves as the Debtor's bankruptcy
counsel.
GOODWILL INDUSTRIES: Seeks to Hire Von Briesen as Counsel for PFA
-----------------------------------------------------------------
Goodwill Industries of Southern Nevada, Inc. seeks approval from
the U.S. Bankruptcy Court for the District of Nevada to hire von
Briesen & Roper, s.c., as legal counsel for Public Finance
Authority.
The firm will represent PFA at its next scheduled hearing to
consider approval of the documents needed to effectuate the
restructuring of certain bonds issued by the agency.
The Debtor will shortly be filing its proposed Chapter 11 plan of
reorganization, which contemplates a restructuring of the bonds.
The hourly rates charged by von Briesen's attorneys range from $239
to $477.50. Paralegal rates range from $125 to $175 per hour.
The firm can be reached through:
Andrew J. Guzikowski, Esq.
von Briesen & Roper, s.c.
411 East Wisconsin Avenue, Suite 1000
Milwaukee, WI 53202
Tel: 414.287.1438 / 414.276.1122
Fax: 414.276.6281
Email: aguzikow@vonbriesen.com
About Goodwill Industries of
Southern Nevada Inc.
Founded in 1975 and headquartered in North Las Vegas, Nevada,
Goodwill of Southern Nevada -- http://www.goodwill.vegas/-- is a
registered 501(c)(3) nonprofit, accepts the communities' gifts in
the form of donated goods and sells those items to provide free job
training and placement services for unemployed locals.
In 2016, Goodwill of Southern Nevada served the job training needs
of 14,465 and directly placed 3,004 individuals into local jobs.
Goodwill also makes a significant impact on the environment through
recycling and reuse practices. In 2016, there were 873,624
generous donors of goods who helped Goodwill divert over 26 million
pounds from its local landfills.
Goodwill Industries -- d/b/a Goodwill of Southern Nevada, Goodwill
Deja Blue Boutique, Goodwill Store/Donation Center, Goodwill
Clearance Center, Goodwill Select, and Goodwill Donation Center --
filed for Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No.
17-14398) on Aug. 11, 2017. In the petition signed by John
Hederman, interim CEO, Goodwill Industries estimated its assets and
debt at between $10 million and $50 million.
Judge Bruce T. Beeley oversees the case.
Zachariah Larson, Esq., at Larson & Zirzow, LLC, serves as the
Debtor's bankruptcy counsel. The Debtor hired Kamer Zucker Abbott;
and Greenberg Traurig, LLP, as special counsel; Piercy Bowler
Taylor & Kern Certified Public Accountants & Business Advisors as
accountant and auditor; and FTI Consulting, Inc., as financial
advisor.
IHEARTMEDIA INC: US Stay Bid on Jan. 10 Plan Hearing Denied
-----------------------------------------------------------
BankruptcyData.com reported that the Court hearing the iHeartMedia
case issued an order denying the United States' motion for a stay
of the January 10 Plan confirmation hearing until appropriations
have been restored to the Department of Justice.
The United States' motion requested, "Although the United States
believes it has resolved all confirmation issues with the Debtors
by agreement, the United States wishes to attend the confirmation
hearing. Counsel for the United States is unable to do so unless
either (a) funding is restored to the Department of Justice, or (b)
the Court denies this Motion. Counsel for the Debtors is opposed to
a stay of the January 10, 2019, hearing."
About iHeartMedia, Inc. and
iHeartCommunications, Inc.
iHeartMedia, Inc. (PINK:IHRT), the parent company of
iHeartCommunications, Inc., is a global media and entertainment
company. Based in San Antonio, Texas, iHeartCommunications
specializes in radio, digital, outdoor, mobile, social, live
events, on-demand entertainment and information services for local
communities, and uses its unparalleled national reach to target
both nationally and locally on behalf of its advertising partners.
The Company operates 849 radio stations. The Company's outdoor
business reaches over 34 countries across five continents.
To implement a balance sheet restructuring, iHeartMedia and 38 of
its subsidiaries, including iHeartCommunications, Inc., filed
voluntary petitions for relief under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 18-31274) on March
14, 2018. The cases are pending before the Honorable Marvin Isgur,
and the Debtors have requested joint administration of the cases.
Clear Channel Outdoor Holdings, Inc. and its subsidiaries did not
commence Chapter 11 proceedings.
As of Sept. 30, 2017, iHeartCommunications had $12.25 billion in
total assets, $23.93 billion in total liabilities, and a total
stockholders' deficit of $11.67 billion.
The Debtors have hired Kirkland & Ellis LLP as legal counsel;
Jackson Walker L.L.P. as local bankruptcy counsel; Munger, Tolles &
Olson LLP as conflicts counsel; Moelis & Company and Perella
Weinberg Partners L.P as financial advisors; Alvarez & Marsal as
restructuring advisor; and Prime Clerk LLC as notice & claims
agent.
The 2021 Noteholder Group is represented by Gibson Dunn & Crutcher
LLP and Quinn Emanuel Urquhart & Sullivan, LLP as co-counsel; and
GLC Advisors & Co. as financial advisor. The ad hoc group of Term
Loan Lenders is represented by Arnold & Porter Kaye Scholer LLP as
counsel; and Ducera Partners as financial advisor. The Legacy
Noteholder Group is represented by White & Case LLP as counsel.
The Debtors' equity sponsors are represented by Weil, Gotshal &
Manges LLP as counsel.
The Office of the U.S. Trustee for Region 7 on March 21, 2018,
appointed seven creditors to serve on the official committee of
unsecured creditors in the Chapter 11 cases. The Committee tapped
Akin Gump Strauss Hauer & Feld LLP as its legal counsel, FTI
Consulting, Inc., as its financial advisor, and Jefferies LLC as
its investment banker.
INFORMATION TECHNOLOGY: Seeks to Hire Stonecipher as Counsel
------------------------------------------------------------
Information Technology Procurement Sourcing, LLC seeks approval
from the U.S. Bankruptcy Court for the Western District of
Pennsylvania to hire Stonecipher Law Firm as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code and will provide other legal services related to
its Chapter 11 case.
Stonecipher will charge these hourly fees:
Partners $415
Counsel $335 - $400
Legal Assistants $125 - $165
Paralegals $125 - $165
The Debtor has agreed to pay the firm a $25,000 retainer, plus the
filing fee of $1,717.
The firm neither holds nor represents any interest adverse to the
Debtor's bankruptcy estate, according to court filings.
Stonecipher can be reached through:
George T. Snyder, Esq.
S. Lofgren, Esq.
Stonecipher Law Firm
125 First Avenue
Pittsburgh, PA 15222
Phone: (412) 391-8510
Fax: (412)391-8522
E-mail: gsnyder@stonecipherlaw.com
E-mail: jlofgren@stonecipherlaw.com
About Information Technology
Procurement Sourcing LLC
Information Technology Procurement Sourcing, LLC sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No.
19-20087) on Jan. 7, 2019. At the time of the filing, the Debtor
estimated assets of less than $1 million and liabilities of less
than $1 million. The case is assigned to Judge Carlota M. Bohm.
The Stonecipher Law Firm is the Debtor's counsel.
INNOVATIVE MATTRESS: Tempur Sealy Providing DIP Financing
---------------------------------------------------------
Tempur Sealy International, Inc., has agreed, subject to bankruptcy
court approval, to provide debtor-in-possession ("DIP") financing
to Innovative Mattress Solutions, LLC ("iMS") in connection with
iMS' Chapter 11 bankruptcy filing. The Company has agreed to
provide up to $14 million in DIP financing to facilitate iMS'
bankruptcy process, which iMS has indicated will include optimizing
its portfolio of retail locations, and is anticipated to be
completed during the first half of 2019.
iMS operates 142 specialty sleep retail locations primarily in the
southeastern U.S. under the names Sleep Outfitters, Mattress
Warehouse, and Mattress King. For the year ended December 31,
2018, iMS represented less than 2% of the Company's global net
sales. As a result of the iMS bankruptcy, the Company will record
a charge of approximately $21 million during the fourth quarter of
2018 to fully reserve this account, which will be excluded from
adjusted EBITDA as a pro forma adjustment under the Company's
senior secured credit agreement.
Tempur Sealy International, Inc. Chairman and CEO Scott Thompson
commented, "Innovative Mattress Solutions has served over a million
consumers and built equity for their and our brands in their
markets. However, we believe iMS' overextended retail footprint
and thin capital structure were not designed to effectively respond
to the competitive pressures of the recent retail environment.
This caused the unexpected need for bankruptcy protection. We will
review strategic alternatives related to iMS during its bankruptcy
process with a focus on what is best for Tempur Sealy consumers in
the affected markets."
About Tempur Sealy
Tempur Sealy International, Inc., develops, manufactures, and
markets mattresses, foundations, pillows and other products. The
Company's products are sold worldwide through third party
retailers, its own stores, and online. The Company's brand
portfolio includes many highly recognized brands in the industry,
including Tempur(R), Tempur-Pedic(R), Sealy(R) featuring
Posturepedic(R) Technology, and Stearns & Foster(R). World
headquarters for Tempur Sealy International is in Lexington, KY.
About Innovative Mattress
Innovative Mattress Solutions, LLC, operates 142 specialty sleep
retail locations primarily in the southeastern U.S. under the names
Sleep Outfitters, Mattress Warehouse, and Mattress King. It offers
sleep outfitters, complete beds, electric adjustable beds, bed bug
protectors, sheets and pillows. Innovative Mattress Solutions was
founded in 1983 and is based in Lexington, Kentucky.
Innovative Mattress Solutions, LLC, and 10 affiliates sought
Chapter 11 protection (Bankr. E.D. Ky. Lead Case No. 19-50042) on
Jan. 11, 2019. The Hon. Gregory R. Schaaf is the case judge.
Innovative Mattress estimated assets of $10 million to $50 million
and liabilities of the same range.
The Debtors tapped DELCOTTO LAW GROUP PLLC as counsel; BROWN,
EDWARDS & COMPANY, L.L.P., as accountants; and CONWAY MACKENZIE,
INC., as financial advisor.
IOTA COMMUNICATIONS: Delays Form 10-Q for Period Ended Nov. 30
--------------------------------------------------------------
Iota Communications, Inc. has filed with the Securities and
Exchange Commission a Form 12b-25 notifying the delay in the filing
of its Quarterly Report on Form 10-Q for the period ended Nov. 30,
2018. The Company was unable to file its Quarterly Report by the
prescribed date of Jan. 14, 2019, without unreasonable effort or
expense, because it needs additional time to complete certain
disclosures and analyses to be included in the Report. In
accordance with Rule 12b-25 promulgated under the Securities
Exchange Act of 1934, as amended, the Company intends to file the
Report on or prior to the fifth calendar day following the
prescribed due date.
As previously reported, on Sept. 5, 2018, a wholly owned subsidiary
of Iota Communications, Inc. (formerly Solbright Group, Inc.), a
Delaware corporation, merged with and into Iota Networks, LLC
(formerly M2M Spectrum Networks, LLC), a dedicated Internet of
Things (IoT) network access and IoT solutions company. Iota
Networks was the surviving company and, as a result of the Merger,
became a wholly owned subsidiary of the Company.
Following the Merger, the financial statements of Iota Networks
will be reported on a consolidated basis with the Company's
financial statements. As a result, the Company expects that a
significant change in results of operations from the corresponding
period for the last fiscal year will be reflected by the earnings
statements to be included in its Quarterly Report on Form 10-Q for
the fiscal quarter ended Nov. 30, 2018.
The Company has not yet finalized its financial statements for the
fiscal quarter ended Nov. 30, 2018. Therefore, the Company is not
able to quantify the anticipated changes in its results of
operations at this time.
About Iota Communications
Newark, New Jersey-based Iota Communications, Inc., formerly known
as Solbright Group, Inc -- https://www.iotacommunications.com/ --
is a new, nationally-available, wireless carrier network system and
applications platform dedicated to the Internet of Things. Iota
sells recurring-revenue solutions that optimize energy usage,
sustainability and operations for commercial and industrial
facilities - principally to Enterprise customers - both directly
and via third-party relationships. Iota also offers important
ancillary products and services which facilitate the adoption of
its subscription-based services, including solar energy, LED
lighting, and HVAC implementation services.
Solbright reported a net loss of $15.80 million for the year ended
May 31, 2018, compared to a net loss of $3.34 million for the year
ended May 31, 2017. As of Aug. 31, 2018, Solbright had $15.03
million in total assets, $6.38 million in total current
liabilities, and $8.64 million in total stockholders' equity.
The audit opinion included in the company's Annual Report on Form
10-K for the year ended May 31, 2018 contains a going concern
explanatory paragraph. RBSM LLP, in New York, the Company's
auditor since 2016, stated that the Company has suffered recurring
losses from operations, will require additional capital to fund its
current operating plan, and has stated that substantial doubt
exists about the Company's ability to continue as a going concern.
JC PENNEY: Fitch Lowers LT IDR to B-, Outlook Stable
----------------------------------------------------
Fitch Ratings has downgraded J.C. Penney Company, Inc. and J.C.
Penney Corporation, Inc.'s Long-Term Issuer Default Ratings (IDR)
to 'B-' from 'B'. The Rating Outlook is Stable.
The downgrade to 'B-' reflects the significant EBITDA erosion in
2018, with EBITDA expected to decline to under $600 million from
$886 million in 2017, and Fitch's expectation that EBITDA could
remain constrained at $500 million - $550 million in 2019 on
comparable store sales (comp) decline in the low single digits. The
deterioration reflects significant execution issues, and in the
near term, sales could be hampered by Sears' store closing
liquidation sales (even if Sears emerges as a smaller chain but
still closes a significant number of stores). There is also
uncertainty around company's go forward strategy given the change
in management team.
While FCF could be negative over the next couple of years, Fitch
expects liquidity to remain adequate to fund seasonal working
capital and pay down near-term debt ($40 million annual term loan
amortization, $50 million note due 2019 and $110 million due 2020).
The company should end up with close to $2 billion in liquidity at
the end of 2018 and $1.5 billion at the end of 2019.
KEY RATING DRIVERS
Significant Deterioration in EBITDA: Mid-single digit declines in
comparable store sales in second half 2018 (2H18) versus a flat
first half 2018 is necessitating significant markdowns to clear
excess inventory. J.C. Penney's recent performance indicates
significant execution issues across categories and reduced
confidence in the company's ability to sustain EBITDA near Fitch's
prior case of $700 million - $750 million.
Fitch expects J.C. Penney's EBITDA to decline to around $550
million to $600 million in 2018 from $886 million in 2017
(excluding asset sales gains and adding back non-cash based
compensation) due to negative comps and meaningful gross margin
compression. Gross margin (on a retail sales only basis) is
expected to decline around 200 basis points (bps) in 2018 on
clearance of excess inventory, given that the company missed its
comp expectations.
Given limited expectations of a gross margin rebound, Fitch
forecasts annual EBITDA to remain around $550 million to $600
million annually over the next 24 to 36 months, with comps
declining in the low single digits and flat gross margin beginning
2019. However, there remains significant execution risk, given the
recent senior management changes, higher than expected
deterioration in revenue and EBITDA, and bankruptcies in the space
(Bon-Ton and Sears), with store liquidation sales likely putting
near term revenue pressure on existing players. FCF is projected to
be negative in 2018 and 2019; however, the company has ample
liquidity, $1.8 billion projected at year-end 2018, to fund the
business and upcoming maturities assuming operations do not
materially weaken from current levels.
As a result of recent operating weakness and new leadership, the
company's near-term direction and strategy is unclear. The prior
management team had made decisions over the past 24 months
including getting into appliances and mattresses in order to take
share away from some its distressed peers. However, new management
could decide on a different course for the company to stem sales
and EBITDA declines.
Decline in Comps: Fitch expects 2018 comps to be down close to 3%,
as comps turned negative in 2H18 after a flat 1H18. J.C. Penney's
3Q18 reported comps came in at negative 5.4% (negative 4.5% on a
shifted basis) and holiday comps (Dec/Jan) were down 5.4% (negative
3.5% on a shifted basis) as reported on Jan. 8, 2019. Fitch expects
J.C. Penney to sustain negative low single digit comps over the
next 12 to 24 months, given continued weakness in key categories
and the ongoing traffic challenges at mid-tier mall-based apparel
retailers, as volume continues to shift online and to discount
channels such as fast fashion and off-price.
Fitch expects underlying store traffic and core apparel sales to
decline in the low- to mid-single-digits. Women's apparel accounted
for $3 billion or 22% of revenue in 2017. Fitch estimates this
business has been declining by mid-single digits annually; however,
J.C. Penney noted that comps for women's apparel were positive in
the second and third quarter of 2018. Men's apparel and accessories
(21% of revenue) and children's apparel (9% of revenue) have likely
been flat to modestly negative. As J.C. Penney has acknowledged,
its women's business has been over-assorted in traditional women's
clothing and under-assorted in casual, contemporary and activewear.
Fitch views the turnaround in this business as challenging, as it
plays catch-up to both existing and new entrants in a crowded
space.
Areas such as home and appliances (15% of sales), which were
previously trending positive, are a near-term drag given Sears
store liquidation sales. Increased investment in home and
appliances were initiatives begun by prior management to
opportunistically take share away from struggling retailers such as
Sears; it remains unclear if the new management will continue to
share that perspective and invest in these initiatives with the
same intensity. J.C. Penney has grown its business in appliances,
window coverings, soft home and mattresses, and has partnered with
Ashley Furniture. The company has used less productive areas of its
stores for these initiatives, which do not require heavy upfront
inventory investment, given a showroom model where purchased
inventory is shipped directly from the manufacturers. The company
added major appliances to more than 500 locations in 2016 and
another 100 locations in 2017. It also expanded its mattress
presence in over 300 locations in 2017, showcasing them in around
500 stores.
As of 1Q18, J. C. Penney and Sears were located in over 350 of the
same malls. Hardlines is the largest category at Sears, accounting
for $7.2 billion (or 43% of consolidated revenue) in 2017. Of this,
$5.6 billion was generated within the Sears mall-based stores in
2017. Hardlines includes categories such as consumer electronics,
appliances and home improvement, in addition to sporting goods and
housewares. Major competitors in the space include The Home Depot,
Inc. (A/Stable) and Lowe's Companies, Inc., Best Buy Co., Inc.
(BBB/Stable), and more recently, J.C. Penney, have all made
significant investments to grow share in some of these categories.
Apparel and soft home represented $4.3 billion (26% of Sears'
consolidated revenue) in 2017, roughly split evenly between Kmart
and Sears stores. In addition, the company has recently invested in
baby gear and toys given the bankruptcy of Toys 'R' Us. While this
could provide opportunities for J.C. Penney to pick up some share,
there could be significant markdown risk if sales do not
materialize as the company builds inventory in these categories.
Comfortable Liquidity: J.C. Penney had cash and cash equivalents of
$168 million as of Nov. 3, 2018 and approximately $1.9 billion
available under its $2.35 billion credit facility after accounting
for $437 million for outstanding borrowings and estimated $135
million of letters of credit (LOC).
Liquidity (cash on hand and availability on $2.35 billion ABL
facility maturing June 2022) is expected to be comfortable at
around $2.0 billion (after taking into account the minimum excess
availability covenant as the fixed charge ratio is expected to be
under 1x under the ABL agreement) at year-end 2018. Assuming no
material changes in payable terms, Fitch expects the company to
have around $1.5 billion in liquidity at year-end 2019 (and $1.3
billion at seasonal working capital build up). This assumes the
company funds the $700 million to $800 million seasonal working
capital swing, FCF shortfall and debt repayments through the ABL.
J.C. Penney has about $90 million of debt maturities in 2019 and
$150 million in 2020, including $40 million annual term loan
amortization. Post these maturities, the next debt maturity is in
2023.
DERIVATION SUMMARY
J.C. Penney's 'B-' rating reflects the significant EBITDA erosion
in 2018, with EBITDA expected to decline to under $600 million from
$886 million in 2017. Fitch expects EBITDA could remain constrained
in the $500 million to $550 million range in 2019 on comp decline
in the low single digits. The deterioration reflects significant
execution issues, and in the near term, sales could be hampered by
Sears' store closing liquidation sales (even if Sears emerges as a
smaller chain but still closes a significant number of stores).
J.C. Penney had positioned itself to benefit from Sears' market
share losses by investing in the home and appliance segments over
the past couple of years. There is also uncertainty around the
company's go forward strategy given the change in management team.
While FCF could be negative over the next couple of years, Fitch
expects liquidity to remain adequate to fund seasonal working
capital and pay down near-term debt ($40 million annual term loan
amortization, $50 million note due 2019 and $110 million due 2020),
as the company should end up with close to $2 billion in liquidity
at the end of 2018 and $1.5 billion at the end of 2019.
J.C. Penney has seen a material 30% decline in total sales since
2010 versus its investment-grade rated peers such as Macy's, Inc.
(BBB/Negative) and Kohl's Corporation (BBB/Stable), which have had
fairly stable top lines during this period. Both Kohl's and Macy's
have a better developed omni-channel offering, and profitability is
higher at 10%+ EBITDA margins versus mid-single digits projected
for J.C. Penney in 2018. Finally, leverage for Kohl's is expected
to trend around in the low 2x and mid-2x for Macy's, versus high-7x
for J.C. Penney.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
-- Comps are expected to be down 3% in 2018 and down 2% - 3% in
2019;
-- EBITDA is expected to be $550 million - $600 million annually.
This assumes gross margin declines in 2018 on excess inventory
clearance with gross margin expected to stabilize in 2019;
-- FCF is expected to be negative $125 million to negative $150
million in 2018 and 2019;
-- Adjusted debt/EBITDAR is expected in the high 7x.
-- Liquidity is expected to remain comfortable, with $1.8 billion
and $1.5 billion of liquidity projected at year-end 2018 and 2019,
respectively.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action:
-- A positive rating action could occur if J.C. Penney's comps
stabilize, EBITDA returns to and sustained over $700 million, such
that FCF is breakeven to modestly positive and leverage moves below
7.0x.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
A negative rating action could occur if comps remain materially
negative, annual EBITDA is sustained under $500 million, leading to
materially negative FCF and increased concerns that the company has
minimal headroom in liquidity to fund operations and seasonal
working capital.
LIQUIDITY
Comfortable Liquidity: J.C. Penney had cash and cash equivalents of
$168 million as of Nov. 3, 2018 and approximately $1.9 billion
available under its $2.35 billion credit facility after accounting
for $437 million for outstanding borrowings and estimated $135
million of LOC.
Liquidity (cash on hand and availability on $2.35 billion ABL
facility maturing June 2022) is expected to be around $2.0 billion
(after taking into account the minimum excess availability covenant
as the fixed charge ratio is expected to be under 1x under the ABL
agreement) at year-end 2018. Assuming no material changes in
payable terms, Fitch expects the company to have around $1.5
billion in liquidity at year-end 2019 (and $1.3 billion at seasonal
working capital build up). This assumes the company funds the $700
million to $800 million seasonal working capital swing, the FCF
shortfall and debt repayments through the ABL.
J.C. Penney has about $90 million of debt maturities in 2019 and
$150 million in 2020, including $40 million annual term loan
amortization. Post these maturities, the next debt maturity is in
2023.
RECOVERY ANALYSIS
For issuers with IDRs of 'B+' and below, Fitch performs a recovery
analysis for each class of obligations of the issuer. The issue
ratings are derived from the IDR and the relevant Recovery Rating
(RR) and notching, based on Fitch's recovery analysis that places a
liquidation value under a distressed scenario in the low to mid-$5
billion range (taking into seasonal working capital build).
Fitch has applied a 70% advance rate against inventory levels as a
proxy for a net orderly liquidation value of the assets. In coming
up with a real estate value of approximately $3.5 billion, Fitch
valued the approximate 415 owned stores at $7 million each (versus
the appraised value of $7.8 million in May 2013) and the eight
owned distribution centers at $50 million each. The per-store
valuation is supported by a number of recent transactions in the
department store space, including real estate sales by Sears.
The liquidation value is higher than the going-concern value, which
Fitch estimates at about $2.8 billion, based on a going-concern
EBITDA of $700 million and a 4x multiple. The $700 million EBITDA
assumes a rightsizing of the business in which the revenue base is
around 30% lower at an EBITDA margin of around 10%, which is
comparable to J.C. Penney's department store peers.
The 4.0x multiple is lower than the 5.4x median multiple for retail
going-concern reorganizations, the 12-year retail market multiples
of 5x to 11x, and 7x to 12x for retail transaction multiples. The
4.0x multiple reflects the significant share losses by department
stores -- and J. C. Penney specficially -- to other formats over
the last 10 to 15 years and Fitch's expectation that department
stores sales will continue to decline in the low single digits
annually.
J.C. Penney's $2.35 billion senior secured asset-backed loan (ABL)
facility that matures in June 2022 is rated 'BB-'/'RR1', which
indicates outstanding recovery prospects (91% - 100%) in a
distressed scenario. The facility is secured by a first-lien
priority on inventory and receivables, with borrowings subject to a
borrowing base.
In the event that its fixed charge coverage ratio is less than 1x,
J.C. Penney is required to maintain a minimum excess availability
at all times of not less than (a) $200 million in the event that
10% of the line cap (the lesser of total commitments under the
credit facility or the borrowing base) is equal to or greater than
$200 million or (b) the greater of (i) 10% of line cap and (ii)
$150 million in the event that 10% of the line cap is less than
$200 million. The calculation for the fixed charge coverage ratio
allows J.C. Penney to deduct up to $250 million in debt repayments
made over the the prior 12 months.
The $1.593 billion term loan and $500 million senior secured notes
due June 2023 are also expected to have outstanding recovery
prospects of 91% to 100%, leading to a 'BB-'/'RR1' rating. Both the
term loan facility and senior secured notes are secured by (a)
first-lien mortgages on 285 owned and ground-leased stores (subject
to certain restrictions primarily related to Principal Property
owned by J.C. Penney Corporation, Inc.) and eight owned
distribution centers; (b) a first lien on intellectual property
(trademarks including J.C. Penney, Liz Claiborne, St. John's Bay
and Arizona), machinery and equipment; (c) a stock pledge of J. C.
Penney Corporation and all of its material subsidiaries and all
intercompany debt; and (d) second lien on inventory and accounts
receivable that back the ABL facility. The term loan and senior
secured notes rank pari passu in terms of priority of payment.
The $400 million senior second lien secured notes due 2025 are
expected to have outstanding recovery prospect of 91% to 100%,
leading to a 'BB-'/'RR1' rating. The notes are secured on a second
lien basis by substantially the collateral securing the term loan
and senior first lien secured notes, other than real property
interests, and a third lien on the ABL collateral. The senior
unsecured notes are rated 'B-'/'RR4', indicating average recovery
prospects (31% to 50%), based on recovery from excess ABL
collateral and unencumbered real estate. The issuance of additional
secured debt as permitted under the ABL and term loan agreements
could could adversely impact the recoveries on the second lien and
unsecured notes.
FULL LIST OF RATING ACTIONS
Fitch has downgraded the following ratings:
J.C. Penney Company
-- Long-Term IDR to 'B-' from 'B'.
J.C. Penney Corporation
-- Long-Term IDR to 'B-' from 'B';
-- Senior first-lien secured debt to 'BB-'/'RR1' from
'BB'/'RR1';
-- Senior second lien secured notes to 'BB-'/'RR1' from
'BB'/'RR1';
-- Senior unsecured notes to 'B-'/'RR4' from 'B'/'RR4'.
The Rating Outlook is Stable.
KIMBALL HILL: TRG Entitled to Recover $9.5MM in Damages from F&D
----------------------------------------------------------------
TRG Venture Two, LLC, filed a motion for an entry of an order (I)
Enforcing Confirmation Order; (II) Directing Dismissal of State
Court Claims; (III) Awarding Damages; and (IV) Granting Related
Relief. TRG is the successor owner of assets from the bankruptcy
cases of Kimball Hill, Inc. and affiliates. The motion is opposed
by Fidelity and Deposit Company of Maryland, a surety on projects
relating to those assets and a creditor of the bankruptcy estate.
Bankruptcy Judge Timothy A. Barnes finds that TRG has suffered
damages as a result of F&D's pursuit of litigation that violated
orders entered by the court.
In the motion, TRG asserted that it has suffered over $30 million
in actual damages, yet does not seek the full measure of such
alleged damages. Instead, TRG seeks $9,539,690 for damages from
August 9, 2011, the date of the Demand Letter, to August 2, 2017.
This amount is comprised of $1,263,008 in legal fees, $194,300 in
consultant fees, $362,382 in project/construction management fees
and $7,720,000 in lost property value. TRG further sought
$31,500,000 in punitive damages.
The motion sought contempt damages under section 105 of the
Bankruptcy Code. The contempt giving rise to the damages sought
stems from the violation of the Court's confirmation order and the
injunction. The motion, however, did not seek redress of a
violation of an injunction created by statute, and TRG has made no
attempt to satisfy the predicates for criminal contempt.
Absent that, the bankruptcy court is not empowered to issue the
punitive damages TRG seeks. TRG may not, therefore, be awarded
punitive damages it seeks. Though this may be a case that would
warrant an award of punitive damages if the criminal contempt
standards were met, the Court need not consider the propriety of
punitive damages as an award of such damages has not been shown.
Further, there has been no showing of a need to coerce compliance
with the Court’s orders. TRG’s request for punitive damages,
therefore, is denied.
TRG, however, has demonstrated to the Court that it incurred a
total of $1,263,086.54 in reasonable legal fees and expenses that
were necessary and related to F&D's efforts against TRG. These fees
are the product of TRG's legal efforts in defending the State Court
lawsuits and TRG's pursuit of the motion, from the date of the
Demand Letter to August 2, 2017, and TRG is entitled to an award of
the same for actual and compensatory damages. TRG further incurred
actual damages in the amount of $194,300 paid for consultant fees,
$362,382 paid for project management fees, and $7,720,000 in lost
property value. The total amount TRG is entitled to recover, and
for which F&D is liable, as damages under the motion is
$9,539,768.54.
A copy of the Court's Memorandum Decision dated Jan. 3, 2019 is
available at:
http://bankrupt.com/misc/ilnb08-10095-4292.pdf
About Kimball Hill
Headquartered in Rolling Meadow, Illinois, Kimball Hill Inc. --
http://www.kimballhillhomes.com/-- was one of the largest
privately-owned homebuilders and one of the 30 largest homebuilders
in the United States, as measured by home deliveries and revenues,
before filing for bankruptcy. The company operated within 12
markets, including, among others, Chicago, Dallas, Fort Worth,
Houston, Las Vegas, Sacramento and Tampa, in five regions: Florida,
the Midwest, Nevada, the Pacific Coast and Texas.
Kimball Hill, Inc., and 29 of its affiliates filed for Chapter 11
protection on April 23, 2008 (Bankr. N.D. Ill. Lead Case No.
08-10095). Ray C. Schrock, Esq., at Kirkland & Ellis LLP,
represents the Debtors in their restructuring efforts. The
Debtors' consolidated financial condition as of Dec. 31, 2007,
reflected total assets of $795,473,000 and total debts
$631,867,000.
Kimball Hill filed a Chapter 11 plan of liquidation on Dec. 2,
2008, which provides for the winding down of the Debtors' business
through a liquidation trust. With the support of the official
committee of unsecured creditors and the company's senior lenders
(estimated to recover 37% to 48% of their claims), the plan was
confirmed on March 12, 2009, and took effect 12 days later. U.S.
Bank National Association was appointed as trustee for the
Liquidation Trust.
L R & T INC: Seeks to Hire Friday Walker as Accountant
------------------------------------------------------
L R & T, Inc., seeks approval from the U.S. Bankruptcy Court for
the Eastern District of Tennessee to hire an accountant.
The Debtor proposes to employ Friday, Walker & Associates, PLLC to
provide accounting services, which include tax preparation,
bookkeeping and the preparation of monthly reports and financial
statements.
The firm will be paid a retainer of $1,000 and will charge these
hourly fees:
Larry Walker, CPA $150
Assistants $100
Clerical Staff $70
Bookkeeping $60
Larry Walker, the accountant employed with Friday Walker who will
be providing the services, is "disinterested" as defined in section
101(14) of the Bankruptcy Code.
The firm can be reached through:
Larry Walker
Friday, Walker & Associates, PLLC
103 Jordan Drive, Suite 4
Chattanooga, TN 37421
Telephone: (423) 855-3935 / (423) 855-0038
Fax: (423) 855-0293
Email: info@fridaywalker.com
About L R & T, Inc.
L R & T, Inc., which conducts business under the name Chattanooga
Pinball, is a retailer of arcade and pinball machines. It also
restores and repairs games.
Based in Chattanooga, Tennessee, L R & T, Inc., filed a Chapter 11
petition (Bankr. E.D. Tenn. Case No. 18-11370) on March 29, 2018.
In the petition signed by Bronica Levin and Rodney Levin,
presidents, the Debtor disclosed $3.26 million in total assets and
$437,775 in total liabilities. The case is assigned to Judge
Shelley D. Rucker. W. Thomas Bible, Jr., Esq., at Tom Bible Law,
is the Debtor's counsel.
LA STEEL SERVICES: Wants Court to Approve Proposed Plan Outline
---------------------------------------------------------------
According to a notice, LA Steel Services, Inc., will move the U.S.
Bankruptcy Court for the Central District of California for an
order approving its disclosure statement in support of chapter 11
plan of reorganization.
The Debtor submits that the disclosure statement contains adequate
information, that is, information that is reasonably practicable
under the circumstances to enable creditors to make an informed
judgment about the plan.
The disclosure statement contains ample and adequate information
under the circumstances of the case and to the extent available to
the Debtor to allow parties in interest to make informed judgments
about the Plan. The disclosure statement includes detailed
information regarding, among other things, the Debtor's assets and
liabilities, the classification and treatment of creditors under
the plan, and how the plan will be implemented and funded.
About LA Steel Services, Inc.
LA Steel Services, Inc. -- http://www.lasteelservices.com/-- is a
construction company in Corona, California, specializing in heavy
highway and bridge construction and public or civil works
infrastructure. It also offers reinforcing steel design
consultations, value engineering, and constructability review.
LA Steel Services sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Cal. Case No. 18-15841) on July 12,
2018. In the petition signed by Pamela Lee Albright, president,
the Debtor disclosed $5.15 million in assets and $3.51 million in
liabilities. Judge Mark D. Houle presides over the case.
LANNETT COMPANY: Moody's Confirms B3 CFR & Alters Outlook to Neg.
-----------------------------------------------------------------
Moody's Investors Service confirmed the ratings of Lannett Company,
Inc. including the B3 Corporate Family Rating, Caa1-PD Probability
of Default Rating and the B3 secured revolver and term loan
facility ratings. The Speculative Grade Liquidity Rating was
upgraded to SGL-2 from SGL-3. This action resolves the ratings
review initiated on August 20, 2018 following the announcement that
Lannett was unable to renew its distribution agreement with Jerome
Stevens Pharmaceuticals ("JSP", unrated), which expires on March
23, 2019.
Under the contract, Lannett has the right to distribute several of
JSP's products, including levothyroxine sodium. This product
accounts for roughly 35% of Lannett's total revenue and is highly
profitable, with around 60% gross margins. Lannett's earnings will
be relatively stable through March 2019, at which point Moody's
expects meaningful sales and earnings erosion from the loss of
contribution from Levothyroxine Sodium.
The ratings confirmation reflects Moody's expectation that a
combination of cost saving actions and revenue from new products
will partially offset the impact of the loss of Levothyroxine
sodium after March 2019. The upgrade of the SGL rating to SGL-2
primarily reflects a bank amendment to Lannett's credit agreement
in December 2018 that reduces the risk of a covenant breach over
the next 12 months.
That said, Moody's expects that financial leverage will increase
significantly, to around 6 times gross debt/EBITDA at the end of
fiscal 2020. In addition, refinancing risk is high given its $125
million undrawn revolver and term loan A ($220 million) mature in
November 2020. The negative outlook reflects Moody's expectation
for weakening credit metrics at a time when Lannett faces rising
refinancing risk.
Ratings confirmed:
Lannett Company, Inc.:
Corporate Family Rating at B3
Probability of Default Rating at Caa1-PD
Senior secured revolver and term loan facilities at B3 (LGD3)
Rating upgraded:
Speculative Grade Liquidity Rating to SGL-2 from SGL-3
Outlook Actions:
Outlook, Changed To Negative from Rating Under Review
RATINGS RATIONALE
Lannett's B3 Corporate Family Rating is constrained by Moody's
expectation for high financial leverage increasing to around 6
times by the end of fiscal 2020 driven primarily by the expected
loss of Levothyroxine and other products under its JSP distribution
agreement. The rating is also constrained by Lannett's moderate
size with revenues of less than $500 million (pro forma for the
loss of levothyroxine sodium), and concentrated in the US generic
drug market. Price erosion within Lannett's existing base of
business will challenge its ability to grow over the next year.
Lannett's ability to partially offset these revenue pressures will
primarily depend on its ability to successfully launch new products
without capacity constraints.
The SGL-2 reflects Moody's expectation that liquidity will be good
over the next 12-15 months. Lannett had $150 million of cash at
September 30, 2018 and an undrawn $125 million bank revolving
credit facility that expires in November 2020. Moody's expects free
cash flow will weaken in fiscal 2020 as cash flow from
levothyroxine goes away. However, Moody's expects free cash flow
will still exceed $50 million in fiscal 2020. Constraining
liquidity, the company has mandatory term loan amortization
payments that will total approximately $67 million in each of the
fiscal years ending June 2019 and June 2020 that will consume cash.
Lannett's bank credit agreement contains a maximum secured net
debt/EBITDA financial maintenance covenant of 3.75 times that will
increase to 4.25 times from December 31, 2019 through June 30,
2020, before stepping down to 4 times thereafter. Lannett's secured
net debt/EBITDA was 3.05 times as of September 30, 2018 (calculated
per its credit agreement. Moody's believes Lannett will remain in
compliance with its amended financial covenants over the next
twelve months.
The negative outlook reflects Moody's expectation for weakening
credit metrics once earnings from levothyroxine sodium fall away
and uncertainty around Lannett's ability to mitigate the impact
from new pipeline launches. The negative outlook also reflects
increasing refinancing risk given approaching debt maturities in
less than two years.
The ratings could be downgraded if Lannett does not refinance its
capital structure well in advance of upcoming maturities. Failure
to meaningfully offset the earnings loss of levothyroxine sodium
with earnings from new product launches and cost savings could also
lead to a ratings downgrade. The ratings could be upgraded if the
company successfully refinances its capital structure and
debt/EBITDA is expected to be sustained below 5 times.
Additionally, successful launching of pipeline drugs that enhance
product diversification could also support an upgrade.
Lannett Company, Inc., headquartered in Philadelphia, Pennsylvania
is a generic drug manufacturer and distributor with capabilities in
difficult-to-manufacture products. Lannett reported revenues of
$685 million for the twelve months ended September 30, 2018.
LBI MEDIA: Files Amended Joint Chapter 11 Reorganization Plan
-------------------------------------------------------------
LBI Media, Inc. and its affiliates filed a joint disclosure
statement in connection with their amended joint chapter 11 plan of
reorganization dated Jan. 4, 2019.
On Nov. 20, 2018, after extensive arms'-length, good-faith
negotiations, overseen by the Debtors' Restructuring Committee, the
Debtors executed a restructuring support agreement with holders of
100% of the outstanding principal amount of the 10% Senior Secured
Notes issued by LBI Media and currently maturing in 2023, all of
which are held or controlled by investment funds managed by HPS
Investment Partners, LLC. Under the terms of the Restructuring
Support Agreement, the Consenting First Lien Noteholders and the
Debtors have agreed to the strategic transactions set forth in the
Plan and described herein. The Restructuring is expected to leave
the Company with a delevered balance sheet and sufficient
liquidity, and better positioned to compete in the highly
competitive television and radio broadcasting and production
industry. The Restructuring is also expected to enhance the
Company's long-term growth prospects and to allow the Company to
increase its focus on operational performance and value creation.
The Plan contemplates either the consummation of: (i) a
"Reorganization Transaction" pursuant to which, among other things,
the holders of Allowed First Lien Notes Claims would receive
interests in, or the proceeds of, an Exit Facility, and 95% of the
New Equity Interests in the Reorganized Debtors in satisfaction of
their Claims or (ii) an alternative transaction that (a) results in
payment of the Allowed First Lien Notes Claims in full in Cash on
the Effective Date, (b) otherwise generally provides better
recoveries to holders of Claims when compared to a Reorganization
Transaction, and (c) in the Debtors' business judgment, is
otherwise superior to a Reorganization Transaction. An Alternative
Transaction may include any type of transaction, including a bid to
sponsor creditor recoveries under the Plan, purchase the Debtors'
assets, or acquire Interests in the Debtors. [In addition, in a
Reorganization Transaction, the holders of Allowed Second Lien
Notes Claims may elect to exercise the First Lien Notes Refinance
Option, pursuant to which the holders of Allowed First Lien Notes
Claims will be paid in full (excluding the Applicable Premium) and
the holders of Allowed Second Lien Notes Claims will receive 100%
of the New Equity Interests on account of such Claims.]
Since the Petition Date, LBI and its advisors have been engaged in
a process to solicit interest and bids from potential strategic and
financial investors (and invited the Debtors' existing lenders) to
participate in a strategic transaction with the Debtors.
Importantly, the Plan and RSA allow the Debtors to solicit bids and
consummate a value-maximizing Alternative Transaction. The Debtors
have received a number of non-binding indications of interest to
date. Binding bids are due on Feb. 4, 2019. Further, pursuant to
the RSA, the Debtors retain the right to, until Feb. 14, 2019,
pursue any Competing Transaction, including a chapter 11 plan that
is inconsistent with the Plan and the Reorganization Transaction.
The Plan and RSA are both designed to provide the Debtors with
flexibility to consummate a transaction that maximizes value for,
and is in the best interests of, the Debtors' estates, creditors,
and parties in interest.
The Plan generally provides for the following treatment for holders
of Claims and Interests:
* Each holder of an Allowed First Lien Notes Claim shall
receive: (i) if a Reorganization Transaction occurs, either (A) if
Class 4 is an Accepting Class (x) the Exit Facility (less the
amount of the DIP Claims converted into the Exit Facility (if
any)), and (y) 95% of the New Equity Interests, [(B) if Class 4 is
an Accepting Class and the First Lien Notes Refinance Option
Purchaser is the holder of the First Lien Notes Claims and
otherwise supports the Plan, the First Lien Notes Refinance Option
Purchaser shall be deemed to have waived any recovery on account of
such First Lien Notes Claims,] or (C) if Class 4 is not an
Accepting Class, [or if Class 4 is an Accepting Class but the First
Lien Notes Refinance Option Date does not occur on or before the
date that is 75 days after the Petition Date or the First Lien
Notes Refinance Option Purchaser does not otherwise support the
Plan,] (x) the Exit Facility (less the amount of the DIP Claims
converted into the Exit Facility (if any)), and (y) 100% of the New
Equity Interests; or, (ii) if an Alternative Transaction occurs,
indefeasible payment in full in Cash.
* Each holder of an Allowed Second Lien Notes Claim shall
receive: (i) if a Reorganization Transaction occurs, (A) if Class 4
is an Accepting Class, such holder's Pro Rata share of 5.0% of the
New Equity Interests, and the Consenting First Lien Noteholders
shall waive any claims they may have under Section 8.21 of the
Intercreditor Agreement, (B)[if Class 4 is an Accepting Class and
the First Lien Notes Refinance Option Purchaser is the holder of
the First Lien Notes Claims and otherwise supports the Plan, such
holder's Pro Rata share of 100% of the New Equity Interests,] or
(C)if Class 4 is not an Accepting Class, [or Class 4 is an
Accepting Class but the First Lien Notes Refinance Option Date does
not occur on or before the date that is 75 days after the Petition
Date, or the First Lien Notes Refinance Option Purchaser does not
otherwise support the Plan,] no recovery under the Plan; or, (ii)
if an Alternative Transaction occurs, such holder's Pro Rata share
of the Net Alternative Transaction Proceeds, if any.
* Each holder of an Allowed HoldCo Unsecured Notes Claim will
receive: (i) if a Reorganization Transaction occurs, (y) if Class 5
and Class 6 are Accepting Classes, such holder's Pro Rata share of
the HoldCo Cash; provided that holders of HoldCo Unsecured Notes
Claims shall share the HoldCo Cash on a pari passu basis with the
holders of Intermediate HoldCo Unsecured Notes Claims, or, (z) if
either Class 5 or Class 6 (or both) is not an Accepting Class, such
holder's Pro Rata share of the HoldCo Cash, provided that holders
of HoldCo Unsecured Notes Claims shall share the HoldCo Cash on a
pari passu basis with the holders of Intermediate HoldCo Unsecured
Notes Claims, and the HoldCo Intercompany Claims; provided that,
under all circumstances, each holder of an Allowed HoldCo General
Unsecured Claim will receive its Pro Rata share of the HoldCo Cash;
or (ii) if an Alternative Transaction occurs, such holder's Pro
Rata share of the Alternative Transaction Recovery Pool.
* Each holder of an Allowed General Unsecured Claim will
receive: (i) if a Reorganization Transaction occurs: (x) each
holder of a General Unsecured Claim that is not a HoldCo General
Unsecured Claim shall receive such holder's Pro Rata share of the
General Unsecured Claims Recovery Pool, or (y) each holder of a
HoldCo General Unsecured Claim will receive its Pro Rata share of
the HoldCo Cash; or, (ii) if an Alternative Transaction occurs,
such holder's Pro Rata share of the Alternative Transaction
Recovery Pool.
The Plan is not premised on, and does not provide for, the
substantive consolidation of the Debtors with respect to the
Classes of Claims or Interests set forth in the Plan, or
otherwise.
The Effective Date of the Plan will not occur unless the
Restructuring transactions contemplated by the Plan close. Upon
such closing the Reorganized Debtors will have sufficient funds to
make the Distributions required under the Plan. Accordingly, the
Debtors believe that all Plan obligations will be satisfied without
the need for a further reorganization.
A copy of the Disclosure Statement is available at:
http://bankrupt.com/misc/deb18-12655-278.pdf
About LBI Media
Headquartered in Burbank, California, LBI Media --
http://www.lbimedia.com/-- is a national television and radio
broadcasting company that was co-founded in 1987 by Lenard
Liberman, LBI's chief executive officer, and his father Jose
Liberman, who immigrated to the United States from Mexico in 1946.
LBI is a national media company that owns or licenses 27
Spanish-language television stations and radio stations in the
United States, as well as EstrellaTV, a Spanish-language television
broadcast network.
LBI Media Inc and more than 15 of its affiliates filed for
bankruptcy protection (Bankr. D. Del. Case No. 18-12655) on Nov.
21, 2018.
In the petition signed by CFO Brian Kei, the Debtors reported total
assets of $238.7 million and total liabilities of $532.9 million as
of June 30, 2018.
Richards Layton & Finger, P.A., and Weil, Gotshal & Manges LLP
serve as counsel to the Debtors. Guggenheim Securities LLC has
been tapped as investment banker, Alvarez & Marsal North America
LLC as financial advisor, and Epiq Corporate Restructuring LLC as
claims and noticing agent.
Andrew Vara, acting U.S. trustee for Region 3, on Dec. 6 appointed
five creditors to serve on the official committee of unsecured
creditors in the Chapter 11 cases of LBI Media, Inc. and its
affiliates. The Committee tapped Squire Patton Boggs (US) LLP as
lead counsel, Bayard, P.A., as co-counsel, and Dundon Advisers LLC
as financial advisor.
LEVIATHAN CANNABIS: Misses Financial Statement Filing Deadline
--------------------------------------------------------------
Leviathan Cannabis Group Inc. on Jan. 14, 2019, announced a two
week update regarding the default announcement pursuant to national
policy 12-203 - Management Cease Trade Orders filed Dec. 31, 2018.
The Company was unable to file its audited annual financial
statements for the year ended Aug. 31, 2018 before the required
filing deadline of Dec. 31, 2018 due to an unforeseen medical
emergency with Leviathan's audit committee chair, Mr. David Jarvis
and additional factors that contributed to the delay in finalizing
the statements.
There are no changes required to be disclosed in reference to
section 10 items (a)-(d) of National Policy 12-203 - Management
Cease Trade Orders, except the change disclosed below under "Other
Material Information". Leviathan's management has spent the last
two weeks continuing to work closely with its auditors, MNP, to
complete the audit of the financial statements for the year ended
August 31, 2018. The Company does not anticipate their filing
occurring any later than January 31, 2019. Leviathan has dedicated
all necessary financial and human resources to complete its audit.
In order to achieve the filing of its audited annual financial
statements by January 31, 2019, Leviathan has ensured key personnel
attend the auditor's premises over the past 2 weeks and will
continue to work alongside MNP for the remainder of the month to
further complete the audit.
On January 7, 2019 the Ontario Securities Commission (OSC) granted
the Company a management cease trade order under the provisions of
National Policy 12-203 - Management Cease Trade Orders to permit
the continued trading in the Company's common shares by persons
other than directors, officers and insiders of Leviathan.
Other Material Information
On July 3, 2018, the Company announced its intention to acquire all
of the issued shares of Pulse Rx Inc., also carrying on business
under the business name Pulse Rx LTC Pharmacy ("Pulse Rx") or the
"Transaction"), a boutique-style pharmacy providing specialized
services to nursing and retirement homes. On January 11, 2019,
owing to the results of the due diligence, the Company decided not
to pursue the Transaction.
About Leviathan Cannabis
Leviathan (cse:EPIC) -- http://www.LeviathanCannabis.com/-- plans
on executing a series of strategic acquisitions that extend across
all vertical markets in Canada and internationally, to support the
Company's proprietary brand strategy. This global reach positions
the Company to be a leading multi-jurisdictional medical and
recreational cannabis enterprise -- one that brings together the
best cannabis products, brands and expertise from Canada and around
the world. The Leviathan portfolio currently comprises Jekyll+Hyde
Brand Builders Inc., a marketing services agency specializing in
the cannabis sector, and Woodstock Biomed Inc., a late-stage
applicant under the ACMPR, which is in the process of retrofitting
a substantial greenhouse production facility in Pelham, Ontario.
LEXARIA BIOSCIENCE: Capital Deficiency Casts Going Concern Doubt
----------------------------------------------------------------
Lexaria Bioscience Corp. filed its quarterly report on Form 10-Q,
disclosing net loss and comprehensive loss of $701,391 on $22,209
of revenue for the three months ended November 30, 2018, compared
with net loss and comprehensive loss of $578,713 on $24,635 of
revenue for the same period in 2017.
At November 30, 2018, the Company had total assets of $3,544,214,
total liabilities of $129,938, and $3,414,276 in total
stockholders' equity.
The Company states: "We have suffered recurring losses from
operations. The continuation of our Company as a going concern is
dependent upon our Company attaining and maintaining profitable
operations and/or raising additional capital. The financial
statements do not include any adjustment relating to the recovery
and classification of recorded asset amounts or the amount and
classification of liabilities that might be necessary should our
Company discontinue operations. The recurring losses from
operations and net capital deficiency raise substantial doubt about
the Company's ability to continue as a going concern."
A copy of the Form 10-Q is available at:
https://bit.ly/2VTqB3X
Lexaria Bioscience Corp. was formed on December 9, 2004, under the
laws of the State of Nevada as an independent oil and gas company
engaged in the exploration, development and acquisition of oil and
gas properties in the United States and Canada. In March of 2014,
the Company began its entry into the medicinal marijuana and
alternative health and wellness business and discontinued its
involvement in the oil and gas business in November 2014. In May
2016, the Company also commenced out-licensing its patented
technology for the purpose of entering into the US regulated
medical and adult use cannabis edibles marketplace. The Company
has its office in Kelowna, BC, Canada.
MESOBLAST LIMITED: Ends Recruitment in MPC-150-IM Phase 3 Trial
---------------------------------------------------------------
Mesoblast Limited has completed patient recruitment in the
events-driven Phase 3 trial of its product candidate Revascor
(MPC-150-IM) for advanced chronic heart failure.
Mesoblast Chief Executive Dr. Silviu Itescu stated: "Completion of
recruitment in this Phase 3 trial, the largest cell therapy trial
for heart failure, is a key milestone for Mesoblast and has been
achieved on plan. This is a substantial step forward in our
objective to bring an effective therapy to countless patients with
progressive heart failure, and a tremendous commercial opportunity
for Mesoblast."
The Phase 3 trial is evaluating whether Revascor reduces recurrent
non-fatal heart failure-related major adverse cardiac events
(HF-MACE), and prevents or delays terminal cardiac events (TCEs),
defined as cardiovascular death, heart transplant or placement of
an artificial device, over at least 12 months. In a previous Phase
2 trial, a single dose of Revascor prevented any TCEs or
hospitalization events over three years in a similar patient
cohort.
The Phase 3 trial has enrolled approximately 570 patients across 55
centers in North America. This enrollment target was guided by the
observed reduction in event rate in the Phase 2 trial and
reinforced by the successful outcome of a pre-specified futility
analysis of the Phase 3 trial's primary endpoint performed after
the first 270 patients were enrolled.
The trial's co-principal investigator, Dr. Emerson Perin, Medical
Director of Texas Heart Institute and Director of its Stem Cell
Center, said: "We are very pleased to have completed recruitment in
this important trial of a cellular therapy for advanced heart
failure patients who have few alternatives. If the Phase 3 trial
results confirm the earlier Phase 2 data, where we saw improvements
in patient function as well as reductions in hospitalizations and
deaths, this important technology will transform cardiovascular
care and would provide a powerful new treatment for advanced heart
failure."
There are over 8 million patients with heart failure in the United
States alone, with 15-20% refractory to all existing medicines and
progressing to advanced heart failure1 (New York Heart Association
Class III or IV). These patients represent a major unmet medical
need due to their high rates of HF-MACE events and mortality.
Dr. Itescu added: "Over the past 12 months, Mesoblast has completed
recruitment in all three of its Phase 3 trials, for acute graft
versus host disease, chronic low back pain, and now chronic heart
failure."
About Mesoblast
Headquartered in Melbourne, Australia, Mesoblast Limited (ASX:MSB;
Nasdaq:MESO) -- http://www.mesoblast.com/-- is a global developer
of innovative cell-based medicines. The Company has leveraged its
proprietary technology platform to establish a broad portfolio of
late-stage product candidates with three product candidates in
Phase 3 trials - acute graft versus host disease, chronic heart
failure and chronic low back pain due to degenerative disc disease.
Through a proprietary process, Mesoblast selects rare mesenchymal
lineage precursor and stem cells from the bone marrow of healthy
adults and creates master cell banks, which can be industrially
expanded to produce thousands of doses from each donor that meet
stringent release criteria, have lot to lot consistency, and can be
used off-the-shelf without the need for tissue matching. Mesoblast
has facilities in Melbourne, New York, Singapore and Texas and is
listed on the Australian Securities Exchange (MSB) and on the
Nasdaq (MESO).
Mesoblast reported a net loss attributable to the owners of
Mesoblast of US$35.29 million for the year ended June 30, 2018,
compared to a net loss attributable to the owners of Mesoblast of
US$76.81 million for the year ended June 30, 2017. As of Sept. 30,
2018, Mesoblast had US$688.78 million in total assets, US$161.19
million in total liabilities, and US$527.59 million in total
equity.
PricewaterhouseCoopers, in Melbourne, Australia, the Company's
auditor since 2008, issued a "going concern" opinion in its report
on the consolidated financial statements for the year ended June
30, 2018. The auditors noted that the Company has suffered
recurring losses from operations that raise substantial doubt about
its ability to continue as a going concern.
MESOBLAST LIMITED: Highlights 2019 Priorities at Biotech Showcase
-----------------------------------------------------------------
Mesoblast Limited reported on commercial and development plans for
its lead cellular therapies to Biotech Showcase 2019 being held
this week in San Francisco, CA.
Mesoblast Chief Executive Dr. Silviu Itescu said: "We enter
calendar 2019 building upon the successful advancement of our
late-stage pipeline where we successfully completed a Phase 3 trial
in steroid-refractory acute graft versus host disease (aGVHD) which
has near-term commercial potential in the United States (U.S.), and
another product candidate having achieved clinical outcomes in line
with the U.S. Food and Drug Administration (FDA) guidance for a
registrable clinical indication for market authorization, and two
additional Phase 3 assets with blockbuster potential. With the
momentum of these marquee therapies, we are preparing for multiple
milestones and inflection points across these product candidates in
the coming year."
Dr. Itescu told meeting attendees that in 2019 Mesoblast plans to
work diligently with the FDA to submit a rolling Biologics License
Application for use of remestemcel-L in treating aGVHD in children,
and will execute on the product candidate's market access and
commercialization strategy.
The meeting attendees were also told that 2019 will be a pivotal
year for the Company's heart failure product candidate Revascor.
Mesoblast will meet with the FDA in the first half of 2019 to
discuss a potential approval pathway for Revascor in patients with
end-stage heart failure and a left ventricular assist device. This
follows the clinically meaningful outcomes of reduction in major
gastrointestinal bleeding and related hospitalizations achieved in
the 159-patient U.S. National Institutes of Health-funded trial in
these patients. In addition, Dr. Itescu provided the key takeaways
on the Phase 3 trial of Revascor for patients with advanced heart
failure which has completed recruitment of approximately 570
patients.
A webcast of the presentation will be available via
https://event.webcasts.com/starthere.jsp?ei=1226368&tp_key=1f4916da2
and as an archived webcast for 90 days on the Investors & Media
section of the Company's website at www.mesoblast.com
About Mesoblast
Headquartered in Melbourne, Australia, Mesoblast Limited (ASX:MSB;
Nasdaq:MESO) -- http://www.mesoblast.com/-- is a global developer
of innovative cell-based medicines. The Company has leveraged its
proprietary technology platform to establish a broad portfolio of
late-stage product candidates with three product candidates in
Phase 3 trials - acute graft versus host disease, chronic heart
failure and chronic low back pain due to degenerative disc disease.
Through a proprietary process, Mesoblast selects rare mesenchymal
lineage precursor and stem cells from the bone marrow of healthy
adults and creates master cell banks, which can be industrially
expanded to produce thousands of doses from each donor that meet
stringent release criteria, have lot to lot consistency, and can be
used off-the-shelf without the need for tissue matching. Mesoblast
has facilities in Melbourne, New York, Singapore and Texas and is
listed on the Australian Securities Exchange (MSB) and on the
Nasdaq (MESO).
Mesoblast reported a net loss attributable to the owners of
Mesoblast of US$35.29 million for the year ended June 30, 2018,
compared to a net loss attributable to the owners of Mesoblast of
US$76.81 million for the year ended June 30, 2017. As of Sept. 30,
2018, Mesoblast had US$688.78 million in total assets, US$161.19
million in total liabilities, and US$527.59 million in total
equity.
PricewaterhouseCoopers, in Melbourne, Australia, the Company's
auditor since 2008, issued a "going concern" opinion in its report
on the consolidated financial statements for the year ended June
30, 2018. The auditors noted that the Company has suffered
recurring losses from operations that raise substantial doubt about
its ability to continue as a going concern.
MOHDSAMEER ALJANEDI: PCO Files 8th Interim Report
-------------------------------------------------
Tamar Terzian, as the successor Patient Care Ombudsman (PCO) for
Mohdsameer Aljanedi Dental Corporation, dba Beachside Dental Group,
filed an eighth interim report for the period of October 1, 2018 to
December 31, 2018.
The PCO recommends the Debtor to maintain all survey/audit
materials for review. Moreover, the PCO recommends the Debtor to
assure that all patient records, which some are electronic and are
securely maintained and complete, must show the signature of
receipt of Patient's Rights.
In general, the PCO reports that all care provided to the patients
by Beachside Dental Group is within the standard of care.
A copy of the PCO's Seventh Interim Report is available for free
at:
http://bankrupt.com/misc/cacb17-14089-188.pdf
About Mohdsameer Aljanedi Dental
Beachside Dental Group is a multi-specialty dental company offering
a wide range of dental services, including general and cosmetic
dentistry, dental sedation, periodontics' gum specialist,
orthodontics, endodontics, oral surgery, pedodontics,
prosthodontics, and laser dentistry. The Company's gross revenue
amounted to $1.65 million in 2016 and $1.50 million during the year
prior that.
Mohdsameer Aljanedi Dental Corporation, d/b/a Beachside Dental
Group, previously sought bankruptcy protection (Bankr. C.D. Cal.
Case No. 13 30138) on Aug. 9, 2013.
Mohdsameer Aljanedi Dental again filed a Chapter 11 petition
(Bankr. C.D. Cal. Case No. 17-14089) on Oct. 15, 2017. The petition
was signed by Mohdsameer Aljanedi, president. At the time of
filing, the Debtor disclosed $1.50 million in total assets and
$3.78 million in liabilities. The case is assigned to Judge Mark S.
Wallace. The Debtor is represented by Michael R. Totaro, Esq., at
Totaro & Shanahan.
On October 20, 2017, the Court approved the appointment of
Constance R Doyle as Patient Care Ombudsman for Mohdsameeer Aljandi
Dental Corporation, d/b/a Beachside Dental Group.
NEXTMARK INC: Negative Cash Flow Raises Going Concern Doubt
-----------------------------------------------------------
NextMark, Inc., filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K, disclosing a net income
of $225,626 on $0 of net revenue for the year ended September 30,
2018.
In the Form 40-K, Company's Interim President Daniel Sobolewski,
states, "The Company historically has experienced significant
losses and negative cash flows from operations. Further, the
Company does not have a revolving credit facility with any
financial institution. These factors raise substantial doubt about
the Company’s ability to continue as a going concern."
Mr. Sobolewski also disclosed that the ability of the Company to
continue as a going concern is dependent on raising additional
capital, negotiating adequate financing arrangements and on
achieving sufficiently profitable operations.
The Company's balance sheet at September 30, 2018, showed total
assets of $5,163,281, total liabilities of $3,465,229, and a total
stockholders' deficit of $1,698,052.
A copy of the Form 10-K is available at:
https://bit.ly/2VTKS9F
NextMark, Inc. was originally incorporated under the laws of
Minnesota in 1972 and were previously known as SE Global Equity.
In May 2007, the Company reincorporated into the State of Delaware
and changed its name to NextMart, Inc. The Company's business
operations include: 1) art event and art media direct marketing;
and 2) design and marketing of art-themed products lines created
for existing luxury and high-end goods and brands and art themed
real estate developments.
NICHOLAS L HUGENTOBLER: Hires Solga & Jakino as Accountant
----------------------------------------------------------
Nicholas L Hugentobler PC seeks authority from the United States
Bankruptcy Court for the District of Colorado (Denver) to hire
Solga & Jakino P.A. as accountant.
The professional services to be provided by Accountant include
preparing and filing the Debtor's gross receipt taxes in New
Mexico. It is necessary for the Debtor to engage Accountant to
provide these services to ensure that the Debtor remains in
compliance with various provisions of the Internal Revenue Code,
the Bankruptcy Code, and the United States Trustee Operating
Guidelines and Reporting Requirement, and professional services are
required to perform this work.
The hourly rates of Accountant's team members are as: $310 for
Brandon Jakino; $172.50 for Denise Norman; and $60.00 for
administrative staff. Accountant has typically billed $350 a month
for services.
Brandon Jakino, Partner at Solga & Jakino P.A., attests that his
firm is disinterested as defined in 11 U.S.C. Sec. 101(14).
Solga & Jakino can be reached through:
Brandon Jakino,
Solga & Jakino P.A.
901 North Tucker
Farmington, NM 87401
About Nicholas L Hugentobler
Nicholas L Hugentobler PC is a medical group that specializes in
podiatry. Based in Durango, Colorado, Nicholas L Hugentobler filed
a voluntary petition pursuant to Chapter 11 of the Bankruptcy Code
(Bankr. D. Colo. Case No. 18-20352) on Nov. 29, 2018. In the
petition signed by Nicholas L. Hugentobler, president, the Debtor
disclosed $1,683,547 in assets and $2,822,012 in liabilities. The
Hon. Michael E. Romero is the case judge. Kutner Brinen, P.C., led
by name partner Jeffrey S. Brinen, is the Debtor's counsel.
NOVETTA SOLUTIONS: Moody's Alters Outlook on Caa1 CFR to Stable
---------------------------------------------------------------
Moody's Investors Service has changed the rating outlook of Novetta
Solutions, LLC to stable from negative and concurrently affirmed
all ratings including the corporate family rating of Caa1.
RATINGS RATIONALE
The change in rating outlook to stable from negative reflects
improved financial performance- in revenue, margin and cash flow-
over the first nine months of 2018 which enabled Novetta to fully
repay its outstanding revolver balance. Additionally, the November
2018 acquisition of Berico was funded through a sponsor equity
contribution. Berico should build Novetta's capacity to prepay debt
and lessen the company's elevated leverage metrics.
While financial performance since ratings were initiated in
September 2015 has been weaker than Moody's anticipated, revenue
has grown and the company is well situated for growth. Novetta's
highly cleared workforce and specialized capabilities within
national security contracting achieve attractive margins (+15%
EBITDA). The advanced analytics skill set remains in high demand
across the US law enforcement, intelligence and special forces
communities and the associated budgets should stay well-funded over
the intermediate term. The backlog level suggests that the solid
organic revenue growth achieved in 2018 may continue in coming
years.
The Caa1 CFR reflects the modest revenue base and a high degree of
contract concentration. With annual revenues of less than $250
million, Novetta possesses a limited market presence within defense
services which reduces the number of meaningfully sized contract
positions the company can develop. The small size also limits the
efficiency of fixed operating cost amortization. About half of
revenues stem from five contracts and the lack of contract
diversity elevates the risk from a contract termination or changed
spending priorities.
The rating also factors in high financial leverage that may not
substantially decline near-term. Calculation of leverage metrics,
pro forma for the Berico acquisition, is made complicated by
Berico's rapid growth since 2016 and one-time costs. Moody's
adjusted basis leverage would have been in the low 8x range as of
September 30, 2018 with funds from operation to debt of 3%. Free
cash flow generation will probably occur in 2019, but likely less
than $10 million, with leverage only improving to the high 7x
range.
Moody's anticipates that Novetta's ability to fully access the
revolver's $40 million commitment will be constrained by a
maintenance covenant headroom limit. However the covenant, a 6x
maximum first lien net leverage test, only applies if revolver
utilization exceeds a set threshold (about $12 million). Should the
company borrow to a point that would activate the test, some
headroom would likely exist.
Upward rating momentum would depend on better financial performance
and credit metrics, with leverage closer to 7x and annual free cash
flow generation above $15 million. An impressive new contract
position-- particularly with a new mission or customer-- would be a
favorable development. As the revolving credit line expires in
October 2020, either sufficient cash on hand to cover operational
liquidity needs, or an extended revolving credit commitment, would
likely be necessary for a higher rating.
Downward rating pressure would mount with a material deterioration
of financial performance, a lack of improvement in credit metrics.
Leverage continuing above 8x, sustained reliance on the revolver,
or covenant headroom issues would be viewed unfavorably.
The following rating actions were taken:
Affirmations:
Issuer: Novetta Solutions, LLC
Probability of Default Rating, Affirmed Caa1-PD
Corporate Family Rating, Affirmed Caa1
Senior Secured 1st Lien Bank Credit Facility, Affirmed B3 (LGD3)
Senior Secured 2nd Lien Bank Credit Facility, Affirmed Caa3 (LGD5)
Outlook Actions:
Issuer: Novetta Solutions, LLC
Outlook, Changed To Stable From Negative
Novetta Solutions, LLC is an advanced analytics company that works
on intelligence and cyber security projects for the government and
commercial organizations. The company is majority-owned by
affiliates of The Carlyle Group. Revenues in 2018, pro forma for
acquisitions, were about $230 million.
OBITX INC: Accumulated Deficit Casts Going Concern Doubt
--------------------------------------------------------
OBITX, Inc., filed its quarterly report on Form 10-Q, disclosing a
net loss from operations of $216,184 on $46,320 of sales for the
three months ended October 31, 2018, compared with a net income
from operations of $968,610 on $1,266,150 of sales for the same
period in 2017.
At October 31, 2018, the Company had total assets of $4,243,963,
total liabilities of $802,549, and $3,441,414 in total
stockholders' equity.
In the Form 10-Q, the Company's Chief Executive Officer Alex
Mardikian and Chief Financial Officer Brandy Craig state, "While
the Company has working capital, the Company has suffered losses
from operations in the amount of $690,702 for the nine month period
ended October 31, 2018 and has an accumulated deficit, which raises
substantial doubt about its ability to continue as a going
concern."
"The Company has negative cash flow but has recognized a
substantial gain in October 2017, due in large part to the services
provided to a single customer, Render Payment, LLC. There are no
assurances the Company will generate a profit or obtain positive
cash flow. The Company has sustained its solvency through the
support of its single shareholder, MCIG, which raise substantial
doubt about its ability to continue as a going concern.
"Management is taking steps to raise additional funds to address
its operating and financial cash requirements to continue
operations in the next twelve months. Management has devoted a
significant amount of time to the raising of capital from
additional debt and equity financing. However, the Company’s
ability to continue as a going concern is dependent upon raising
additional funds through debt and equity financing and generating
revenue. There are no assurances the Company will receive the
necessary funding or generate the revenue necessary to fund
operations. The financial statements contain no adjustments for the
outcome of this uncertainty."
A copy of the Form 10-Q is available at:
https://bit.ly/2Fuy2tw
OBITX, Inc., publishes and generates textual, audio, and/or video
content on the Internet, and operate web sites that use a search
engine to generate and maintain extensive databases of internet
addresses and content. The Company earns revenue through social
media advertising, fees, and services. The Company was
incorporated in the State of Delaware on March 30, 2017 originally
under the name GigeTech, Inc. On October 31, 2017 the Company
changed its name to OBITX, Inc., and updated its Articles of
Incorporation through unanimous consent of its shareholder, MCIG.
The Company is headquartered in Jacksonville, Florida.
OLAIDE DARAMOLA: Plan Outline Hearing Set for March 22
------------------------------------------------------
Bankruptcy Judge Nancy V. Alquist will convene a hearing on March
22, 2019 at 10:00 a.m. to consider approval of Olaide Daramola,
Gbamgbade Daramola, Abimbola Daramola, Macro Concept, LLC, and
Grace Solution, LLC's amended disclosure statement.
Jan. 22, 2019 is fixed as the last day for filing and serving
written objections to the Disclosure Statement.
The Troubled Company Reporter previously reported that the amended
plan does not differ from the original plan in terms of general
structure, but it does include a few significant changes which to a
degree address objections and questions raised at the initial
disclosure statement hearing. The debtors believe that these
changes represent significant improvements in the treatment of
certain creditors and enhance the feasibility of the plan as a
whole.
A copy of the Amended Joint Disclosure Statement is available at
https://tinyurl.com/ycyf6ee3 from Pacermonitor.com at no charge.
Olaide Daramola filed for chapter 11 bankruptcy protection (Bankr.
D. Md. Case No. 16-21657) on August 30, 2016, and is represented by
Thomas E. Crowe, Esq.
PACIFIC GAS: Moody's Lowers CFR to Caa3, Outlook Negative
---------------------------------------------------------
Moody's Investors Service, on Jan. 14, 2018, downgraded the ratings
of Pacific Gas & Electric Company and its holding company, PG&E
Corporation , including the Corporate Family Rating to Caa3 from
Ba3 and Probability of Default Rating to Ca-PD from B1-PD. Moody's
also downgraded PG&E's senior unsecured rating to Caa3 from Ba3,
PCG's senior unsecured rating to C from B2 and the Speculative
Grade Liquidity Rating to SGL-4 from SGL-3. The rating outlook is
negative. This rating action concludes the review for downgrade
initiated on November 15, 2018.
Downgrades:
Issuer: California Infrastructure & Econ. Dev. Bank
Senior Unsecured Revenue Bonds, Downgraded to Caa3(LGD3) from
Ba3(LGD3)
Issuer: California Pollution Control Financing Auth.
Senior Unsecured Revenue Bonds, Downgraded to Caa3(LGD3) from
Ba3(LGD3)
Underlying Senior Unsecured Revenue Bonds, Downgraded to Caa3(LGD3)
from Ba3(LGD3)
Issuer: Pacific Gas & Electric Company
Issuer Rating, Downgraded to Caa3 from Ba3
Pref. Stock, Downgraded to Ca(LGD5) from B2(LGD5)
Senior Unsecured Bank Credit Facility, Downgraded to Caa3(LGD3)
from Ba3(LGD3)
Senior Unsecured Regular Bond/Debenture, Downgraded to Caa3(LGD3)
from Ba3(LGD3)
Underlying Senior Unsecured Regular Bond/Debenture, Downgraded to
Caa3(LGD3) from Ba3(LGD3)
Senior Unsecured Shelf, Downgraded to (P)Caa3 from (P)Ba3
Issuer: PG&E Corporation
Issuer Rating, Downgraded to C from B2
Probability of Default Rating, Downgraded to Ca-PD from B1-PD
Corporate Family Rating, Downgraded to Caa3 from Ba3
Speculative Grade Liquidity Rating, Downgraded to SGL-4 from SGL-3
Subordinate Shelf, Downgraded to (P)C from (P)B3
Senior Unsecured Shelf, Downgraded to (P)C from (P)B2
Pref. Shelf, Downgraded to (P)C from (P)Caa1
Pref. Non-Cumulative Shelf, Downgraded to (P)C from (P)Caa1
Senior Unsecured Bank Credit Facility, Downgraded to C(LGD5) from
B2(LGD5)
Outlook Actions:
Issuer: Pacific Gas & Electric Company
Outlook, Changed To Negative From Rating Under Review
Issuer: PG&E Corporation
Outlook, Changed To Negative From Rating Under Review
RATINGS RATIONALE
"The rating downgrade is prompted by the very high likelihood of a
bankruptcy filing by PG&E and its parent company following the
announcement today that they expect to make such a filing on or
about 29 January," said VP-Senior Credit Officer, Jeff Cassella.
"Management has indicated that they believe the Chapter 11 process
is the only viable option to resolve potentially substantial
wildfire liabilities, rebuild and invest in its existing system,
and maintain access to sufficient financial and liquidity sources,"
added Cassella.
The Caa3 CFR reflects the company's declining financial position
and increasingly limited flexibility as wildfire liabilities mount,
collateral posting is required, and higher investments in wildfire
safety and prevention are mandated. The rating incorporates the
company's view that potential liabilities stemming from the 2017
and 2018 northern California wildfires will be extensive. The
rating factors in a legislative and regulatory environment that has
become so challenging that management believes it is unlikely that
the wildfire exposure will be addressed in a manner that is timely
enough to support the financial stability of the company.
The ratings consider that ultimate recovery for the company's
unsecured creditors is highly uncertain, owing to the unknown and
potentially significant liabilities the company may potentially be
held accountable for because of its role in the wildfires. In
addition, there is a lack of clarity on the actual size of the
total claims for property damages, legal fees and any other
punitive damages. The company's total wildfire exposure may take
several years to determine and may impact recovery for debtholders.
Moody's expects to withdraw all debt ratings immediately following
any bankruptcy filing.
After a comprehensive review by both boards of directors with the
help of outside advisors, PG&E and its parent have determined that
reorganization under a Chapter 11 bankruptcy filing is necessary
and is in the best interest of stakeholders, including wildfire
claimants. The company is seeking protection from potentially
extensive liabilities stemming from the 2017 and 2018 northern
California wildfires. Among other things, PG&E expects the Chapter
11 process will allow for an orderly and fair process to resolve
these wildfire liabilities and assure PG&E has access to financial
resources necessary to continuously invest in its infrastructure
including wildfire safety and prevention. Under SB 901, effective 1
January 2019, the Public Utilities Code Section 854.2(d) requires
that prior to a "change of control" of a utility, which includes
bankruptcy protection, the utility is required to give at least 15
days' advance notice to employees.
In its announcement, management indicated that it believes that the
company could access the capital markets and raise capital through
the issuance of secured debt, using the utility's assets to secure
additional funding and extend its liquidity for an extended period
of time. However, PCG and PG&E's boards of directors concluded that
issuing secured debt outside of a restructuring under Chapter 11
would not address the fundamental issues and challenges that the
company faces.
The company estimates that if the utility were to be found liable
for certain or all of the costs and penalties related to the 2017
and 2018 wildfires, the amount of such liability could exceed $30
billion, which does not include potential punitive damages. This
estimate does include the approximately $17 billion of insurance
claims for property losses made to date related to the wildfires.
PCG and PG&E's SGL-4 speculative grade liquidity ratings consider
the company's weak liquidity position, including its still sizable
but declining cash balance. As of 11 January 2019, the company
reported an aggregate cash balance of $1.5 billion, of which
Moody's estimates that up to $800 million might be consumed by the
need to post collateral for payment obligations due to its ratings
dropping below investment grade. PG&E and PCG had fully drawn their
revolving credit facilities, with aggregate borrowings outstanding
of roughly $3 billion and $300 million, respectively, except for
approximately $35 million of aggregate availability due to the
retirement of certain letters of credit. No additional amounts are
available and both facilities expire in April 2022. These
facilities do not include a material adverse change clause but have
a financial covenant limiting the debt to total capitalization
ratio to no more than 65%. Both companies were in compliance with
this financial covenant as of 30 September 2018. However, Moody's
thinks there is a high likelihood of substantial charges being
taken for wildfire liabilities, which could materially impact their
financial covenant cushion.
PG&E announced that it does not intend to make the interest payment
of approximately $21.6 million due on 15 January with respect to
its 2040 Notes. It has a 30-day grace period to make the interest
payment before triggering an event of default. Upcoming maturities
in the near-to-intermediate term include PG&E's $250 million term
loan due in February 2019, as well as the parent's $350 million
term loan due April 2020, which also includes an option for a
one-year extension. In addition, Moody's estimates that PG&E may be
required to post as much as $800 million more in collateral because
the utility's rating dropped below investment grade.
PG&E has engaged its lenders to secure approximately $5.5 billion
of debtor-in-possession (DIP) financing at the time that it files
for relief under Chapter 11. The company has received highly
confident letters from a number of major banks.
Moody's expects the company will find it challenging to conduct its
normal operating activities during the two weeks leading up to the
eventual bankruptcy filing. However, PG&E expects that it has
sufficient cash available to continue providing service to its
customers during this time and until the DIP financing becomes
available.
Jan. 10 Rating
Moody's Investors Service, on Jan. 10, 2018, downgraded the ratings
of Pacific Gas & Electric Company, including its senior unsecured
rating to Ba3 from Baa2 and its short term rating for commercial
paper to Not Prime from Prime-2. Moody's also downgraded PG&E's
holding company, PG&E Corporation, including its senior unsecured
rating to B2 from Baa3 and its short term rating for commercial
paper to Not Prime from Prime-3. At the same time, Moody's assigned
a Ba3 Corporate Family Rating, a B1-PD Probability of Default
rating and an SGL-3 Speculative Grade Liquidity Rating. Ratings of
PCG and PG&E remain on review for downgrade.
Downgrades:
Issuer: California Infrastructure & Econ. Dev. Bank
Senior Unsecured Revenue Bonds, Downgraded to Ba3 (LGD3) from Baa2;
Placed Under Review for further Downgrade
Issuer: California Pollution Control Financing Auth.
Senior Unsecured Revenue Bonds, Downgraded to Ba3 (LGD3) from Baa2;
Placed Under Review for further Downgrade
Underlying Senior Unsecured Revenue Bonds, Downgraded to Ba3 (LGD3)
from Baa2; Placed Under Review for further Downgrade
Issuer: Pacific Gas & Electric Company
Issuer Rating, Downgraded to Ba3 from Baa2; Placed Under Review for
further Downgrade
Preferred Stock, Downgraded to B2 (LGD5) from Ba1; Placed Under
Review for further Downgrade
Senior Unsecured Bank Credit Facility, Downgraded to Ba3 (LGD3)
from Baa2; Placed Under Review for further Downgrade
Senior Unsecured Commercial Paper, Downgraded to NP from P-2
Senior Unsecured Regular Bond/Debenture, Downgraded to Ba3 (LGD3)
from Baa2; Placed Under Review for further Downgrade
Underlying Senior Unsecured Regular Bond/Debenture, Downgraded to
Ba3 (LGD3) from Baa2; Placed Under Review for further Downgrade
Senior Unsecured Shelf, Downgraded to (P)Ba3 from (P)Baa2; Placed
Under Review for further Downgrade
Issuer: PG&E Corporation
Issuer Rating, Downgraded to B2 from Baa3; Placed Under Review for
further Downgrade
Preferred Shelf, Downgraded to (P)Caa1 from (P)Ba2; Placed Under
Review for further Downgrade
Preferred Non-Cumulative Shelf, Downgraded to (P)Caa1 from (P)Ba2;
Placed Under Review for further Downgrade
Subordinate Shelf, Downgraded to (P)B3 from (P)Ba1; Placed Under
Review for further Downgrade
Senior Unsecured Shelf, Downgraded to (P)B2 from (P)Baa3; Placed
Under Review for further Downgrade
Senior Unsecured Bank Credit Facility, Downgraded to B2 (LGD5) from
Baa3; Placed Under Review for further Downgrade
Senior Unsecured Commercial Paper, Downgraded to NP from P-3
Assignments:
Issuer: PG&E Corporation
Probability of Default Rating, Assigned B1-PD; Placed Under Review
for further Downgrade
Speculative Grade Liquidity Rating, Assigned SGL-3
Corporate Family Rating, Assigned Ba3; Placed Under Review for
further Downgrade
RATINGS RATIONALE
"We see a much more challenging environment for PG&E, as potential
liabilities grow, liquidity reserves decline and access to capital
becomes more uncertain," said VP-Senior Credit Officer, Jeff
Cassella. "The company is increasingly reliant on extraordinary
intervention by legislators and regulators, which may not occur
soon enough or be of sufficient magnitude to address these adverse
developments." added Cassella.
Over the last two months, since we placed the ratings of both PCG
and PG&E on review for downgrade, the company has experienced more
negative developments. In December, state legislative leaders
publicly aired their concerns about perceived weaknesses in PCG's
corporate governance which we believe are influencing the
relationship between PG&E and its regulator, the California Public
Utility Commission (CPUC). In fact, on 21 December, the CPUC opened
a new phase in an existing three-year old investigation into PCG's
safety culture. Possible outcomes from the investigation include
changes to the Board of Directors and senior management, a
corporate restructuring, and possibly reconstituting the ownership
structure into a non-profit utility enterprise.
In addition, on December 13, the CPUC opened another investigation
as to whether PG&E violated the state's natural gas safety rules.
The CPUC's order followed the recent investigation report by the
CPUC Safety and Enforcement Division (SED) staff, which alleges
that PG&E falsified records from 2012 to 2017. Financial penalties
could result. These alleged violations are a material credit
negative for PG&E because, if found to be true, this could be a
sign of a systemic weakness at PG&E with respect to corporate
governance and oversight policies. The new allegations about
natural gas safety violations also are arising right after PG&E
filed its 2020 general rate case, in which the utility is
requesting a revenue increase of about $1.1 billion.
The review for downgrade will continue to look for signs of
legislative and regulatory support for PG&E as the company works
through the various investigative, legal and regulatory processes
with the California Department of Forestry and Fire Protection (CAL
FIRE) and the CPUC. The review for downgrade will also focus on the
potentially burgeoning liabilities facing the utility, the criteria
and methodology being developed to calculate the financial stress
test (CPUC hearings begin today), the likelihood and timing of any
securitization financing to finance the potential 2017 wildfire
liabilities, as well as uncertainty about whether securitization
financing will be allowed to address the potential 2018 wildfire
liabilities. The review could result in a multi-notch downgrade of
the ratings of both PCG and PG&E.
Moody's notes that PG&E, which has a capital structure comprised of
only unsecured debt, can issue secured debt, assuming authorization
from the CPUC and the utility has access to the capital markets.
The Ba3 CFR incorporates a view that the potential liability
associated with the 2017 and 2018 wildfires is at least $15
billion, and resulting pressure on the balance sheet and liquidity.
The rating also considers the risks associated with facing
additional wildfire liabilities given the likelihood of future
wildfires in the utility's service territory and California's
unusually strict liability law known as inverse condemnation.
Moody's views the California regulatory environment as more unique
compared to other state regulatory jurisdictions. The CPUC had been
historically credit supportive, and provided access to extensive
recovery mechanisms, including decoupling and a forward test year
as well as above average rates of return. These recovery provisions
are expected to remain, but the rating now incorporates a more
onerous legislative environment due to the continued exposure
related to potential future wildfire costs under inverse
condemnation. The potential for these future risks to occur is high
due to climate change and increased population in fire-prone areas.
These risks are only partially mitigated by the new and untested
regulatory cost recovery framework outlined by SB 901. The rating
also factors in the state's demanding public policy goals and an
elevated level of political risk, especially given the company's
history of safety and governance issues.
PCG and PG&E's SGL-3 speculative grade liquidity ratings consider
relatively stable cash flow generation. Currently, Moody's
estimates an aggregate cash balance of roughly $2 billion. We
estimate that about $800 million might be consumed by the need to
post collateral for payment obligations. PG&E and PCG have fully
drawn their respective revolving credit facilities, with aggregate
borrowings outstanding of $3 billion and $300 million,
respectively. No additional amounts are available and both
facilities expire in April 2022. These facilities do not include a
material adverse change clause but have a financial covenant
limiting the debt to total capitalization ratio to no more than
65%. Both companies were in compliance with this financial covenant
as of 30 September 2018. However, we think there is a high
likelihood of substantial charges being taken for wildfire
liabilities, which could materially impact its financial covenant
cushion.
Upcoming maturities in the near-to-intermediate term include PG&E's
$250 million term loan due in February 2019, as well as the
parent's $350 million term loan due April 2020, which also includes
an option for a one-year extension. In addition, we estimate that
PG&E may be required to post as much as $800 million more in
collateral because the utility's rating dropped below investment
grade.
PG&E Corporation is a utility holding company headquartered in San
Francisco, California that conducts nearly all of its business
through Pacific Gas and Electric Company, a vertically integrated
utility serving northern and central California. At 30 September
2018, PG&E's assets of around $70 billion represented 99% of PCG's
consolidated assets and total reported debt was approximately $18.3
billion. PG&E serves approximately 5.4 million electric
distribution customers and 4.5 million natural gas customers. PG&E
is regulated by the California Public Utilities Commission and by
the Federal Energy Regulatory Commission.
PACIFIC GAS: Says Looming Chapter 11 Filng Won't Affect Services
----------------------------------------------------------------
PG&E Corporation said on Jan. 14, 2019, it remains committed to
providing safe natural gas and electric service to customers as it
prepares to initiate voluntary reorganization proceedings under
Chapter 11. The Company on Jan. 14 provided the 15-day advance
notice required by recently enacted California law that it and its
wholly owned subsidiary Pacific Gas and Electric Company (the
"Utility") currently intend to file petitions to reorganize under
Chapter 11 of the U.S. Bankruptcy Code on or about January 29,
2019.
During this process, the Company is also committed to continuing to
make investments in system safety as it works with regulators,
policymakers and other key stakeholders to consider a range of
alternatives to provide for the safe delivery of natural gas and
electric service for the long-term in an environment that continues
to be challenged by climate change. PG&E expects that the Chapter
11 process will, among other things, support the orderly, fair and
expeditious resolution of its potential liabilities resulting from
the 2017 and 2018 Northern California wildfires, and will assure
the Company has access to the capital and resources it needs to
continue to provide safe service to customers.
The Company does not expect any impact to electric or natural gas
service for its customers as a result of the Chapter 11 process.
PG&E remains committed to assisting the communities affected by
wildfires in Northern California, and its restoration and
rebuilding efforts will continue. The Company also expects that
its employees will continue to receive their pay and healthcare
benefits as usual.
John R. Simon, PG&E Corporation Interim CEO, said, "The people
affected by the devastating Northern California wildfires are our
customers, our neighbors and our friends, and we understand the
profound impact the fires have had on our communities and the need
for PG&E to continue enhancing our wildfire mitigation efforts. We
remain committed to helping them through the recovery and
rebuilding process. We believe a court-supervised process under
Chapter 11 will best enable PG&E to resolve its potential
liabilities in an orderly, fair and expeditious fashion. We expect
this process also will enable PG&E to access the capital and
resources we need to continue providing our customers with safe
service and investing in our systems and infrastructure. Everyone
at PG&E knows that our single most important responsibility is
safety, and we recognize that we must work even harder every day to
demonstrate that the safety of our customers, our communities, our
employees and our contractors comes first."
Richard C. Kelly, Chair of the Board of Directors of PG&E
Corporation, said, "Following a comprehensive review with the
assistance of our outside advisors, the PG&E Board and management
team have determined that initiating a Chapter 11 reorganization
for both the Utility and PG&E Corporation represents the only
viable option to address the Company's responsibilities to its
stakeholders. Our goal will be to work collaboratively to fairly
balance the interests of our many constituents -- including
wildfire victims, customers, employees, creditors, shareholders,
the financial community and business partners -- while creating a
sustainable foundation for the delivery of safe service to our
customers in the years ahead. The Chapter 11 process allows us to
work with these many constituents in one court-supervised forum to
comprehensively address our potential liabilities and to implement
appropriate changes."
The Company expects that the Chapter 11 process will, among other
things:
-- Enable continued safe delivery of natural gas and electric
service to PG&E's millions of customers;
-- Support the orderly, fair and expeditious resolution of
PG&E's potential liabilities resulting from the 2017 and 2018
Northern California wildfires;
-- Enable PG&E to continue its extensive restoration and
rebuilding efforts to assist communities affected by the 2017 and
2018 wildfires in Northern California;
-- Allow the Company to work with regulators and policymakers to
determine the most effective way for customers to receive safe
natural gas and electric service for the long-term in an
environment that continues to be challenged by climate change; and
-- Assure the Company has access to the capital and resources
necessary to support ongoing operations and enable PG&E to continue
investing in its systems, infrastructure and critical safety
efforts, including investing in its Community Wildfire Safety
Program, an additional precautionary safety measure implemented
following the 2017 Northern California wildfires to further reduce
wildfire risk.
PG&E has engaged in discussions with potential lenders with respect
to Debtor-in-Possession ("DIP") financing. PG&E expects to have
approximately $5.5 billion of committed DIP financing at the time
it files for relief under Chapter 11 on or about January 29, 2019,
and has received highly confident letters from a number of major
banks. The DIP financing will provide PG&E with sufficient
liquidity to fund the Company's ongoing operations, including its
ability to provide safe service to customers.
About PG&E Corporation
PG&E Corporation (NYSE: PCG) -- http://www.pgecorp.com/-- is a
Fortune 200 energy-based holding company, headquartered in San
Francisco. It is the parent company of Pacific Gas and Electric
Company, an energy company that serves 16 million Californians
across a 70,000-square-mile service area in Northern and Central
California.
* * *
PG&E Corporation said on Jan. 14, 2019, that it and its wholly
owned subsidiary Pacific Gas and Electric Company (the "Utility")
currently intend to file petitions to reorganize under Chapter 11
of the U.S. Bankruptcy Code on or about January 29, 2019.
Weil, Gotshal & Manges LLP and Cravath, Swaine & Moore LLP are
serving as the Company's legal counsel, Lazard is serving as its
investment banker, and AlixPartners LLP is serving as the
restructuring advisor to PG&E.
PG&E Corporation is said to be considering a bankruptcy filing to
organize the billions of dollars in potential liabilities from
wildfires its equipment may have ignited, Bloomberg News's Mark
Chediak and Margot Habiby have reported. Bloomberg noted that PG&E
has lost more than half its market value since the deadliest
wildfire in California history broke out in early November,
compounding financial woes it was already facing after blazes
destroyed parts of wine country a year earlier.
Beginning on October 8, 2017, multiple wildfires spread through
Northern California, including Napa, Sonoma, Butte, Humboldt,
Mendocino, Lake, Nevada, and Yuba Counties, as well as in the area
surrounding Yuba City. According the California Department of
Forestry and Fire Protection's California Statewide Fire Summary
dated October 30, 2017, at the peak of the wildfires, there were 21
major wildfires in Northern California that, in total, burned over
245,000 acres and destroyed an estimated 8,900 structures. The
wildfires resulted in 44 fatalities.
Cal Fire issued its determination on the causes of 17 of the
Northern California wildfires, and alleged that each of these fires
involved the Utility's equipment. The remaining wildfires remain
under Cal Fire's investigation, including the possible role of
Pacific Gas' power lines and other facilities. Additionally, the
Northern California wildfires are under investigation by the
California Public Utilities Commission's Safety and Enforcement
Division.
PG&E posted total assets of $71.4 billion against $9.5 billion of
total current liabilities and $42.2 billion of total non-current
liabilities as of Sept. 30, 2018, according to its quarterly report
for the three-month period ended Sept. 30. Total current
liabilities include $2.8 billion in wildfire-related claims. That
figure is up from $561 million as of Dec. 31, 2017.
PG&E CORP: Fitch Lowers LT Issuer Default Rating to C
-----------------------------------------------------
Fitch Ratings has downgraded PG&E Corporation's and Pacific Gas and
Electric Company's Long-Term Issuer Default Ratings to 'C' from
'BBB-' given that a default like process has begun with the company
making an announcement this morning that it intends to file both
PCG and PG&E for bankruptcy protection on Jan. 29, 2019. The
company has also indicated that it does not intend to make an
interest payment due tomorrow with respect to its 2040 senior
notes. Non-payment of interest is an event of default under its
senior bond indenture if not cured within 30 days. Fitch would
downgrade PG&E and PCG to 'D' if the default is not cured or if the
company files for bankruptcy protection ahead of the EOD.
Fitch has also downgraded PG&E's senior unsecured debt to
'CC'/'RR3' from 'BBB' and preferred stock to 'C'/'RR6' from 'BBB-',
while downgrading PCG's senior unsecured debt to 'C'/'RR6' from
'BBB-'.
The imminent bankruptcy filing reflects the culmination of a crisis
of confidence driven by potential wildfire-related liabilities in
the tens of billions of dollars related to the Tubbs and Camp Fires
without a clear path to timely recovery of such costs under
California law. California typically applies the doctrine of
inverse condemnation to privately owned utilities to socialize
costs associated with catastrophic wildfires. The company's
position is further complicated by long standing safety challenges
in its electric and natural gas businesses. PCG has announced the
resignation of CEO and President Geisha Williams.
KEY RATING DRIVERS
Recovery Analysis: Fitch has utilized a bespoke recovery analysis
to arrive at debt instrument ratings of PCG and PG&E. Fitch uses
average expected 2018 rate base of $36.8 billion for going concern
enterprise valuation. PG&E is in the process of procuring $5.5
billion of debtor-in-possession financing that is included in
administrative claims in Fitch's recovery analysis. As of Jan. 11,
2019, PCG and PG&E had cash and cash equivalents of approximately
$400 million and $1.1 billion, respectively, and $35 million
available under its credit facilities. Fitch has assumed that this
liquidity is used to meet trade and other general claims during the
15-day period leading to the bankruptcy filing. In addition,
Fitch's recovery waterfall assumes approximately $30 billion of
wildfire-related claims, which reflects the company's estimate, and
conservatively assumes additional pension liabilities of
approximately $2 billion which are expected to be pari passu with
PG&E's outstanding unsecured debt obligations.
While potential punitive damages, fines and penalties could
increase liabilities for the utility, a fair and expedited process
to resolve outstanding claims before the bankruptcy court could
reduce the overall wildfire claim amount. Outstanding PG&E debt and
preferred approximates $22 billion. Based on Fitch's recovery
analysis, recoveries for PG&E's unsecured debt fall in a range of
51%-70% resulting in 'CC'/'RR3' ratings. The recovery analysis
results in 'C'/'RR6' for both PG&E's preferred stock and its
parent's outstanding unsecured debt.
Large Potential Liabilities: Fitch has assumed that settled third
party wildfire liabilities will approximate $30 billion net of
insurance if Cal Fire determines that utility equipment was the
cause of the Tubbs and Camp Fires. In a recent filing with the U.S.
District Court for the Northern District of California overseeing
the corporation's probation for 2016 felony convictions related to
the 2010 San Bruno pipeline fire and explosion, the company
suggested that its equipment may not have been the cause of the
Tubbs Fire, which is under investigation by Cal Fire. Conversely,
utility disclosure implies a higher probability that the utility's
equipment was involved in ignition of the much larger Camp Fire.
History of Safety Lapses: In addition to the utility's ongoing
struggle to improve safety with regard to wildfires, PG&E has had
repeated accidents and operational problems in its natural gas
business, including the 2010 San Bruno pipeline fire and explosion.
Most recently, reports of PG&E employees falsifying location
marking reports in its natural gas business surfaced in December
further damaging political goodwill. The California Public
Utilities Commission (CPUC) opened an investigation of the matter.
Separately, the CPUC has opened a second phase in its three-year
old investigation into PG&E's safety culture, which will consider a
wide array of options to mitigate safety concerns.
Federal Oversight Pressure: A federal judge overseeing PG&E's
parole in its San Bruno felony conviction may require the utility
to complete a comprehensive program to overhaul its transmission
and distribution system to prevent wildfires by the start of the
2019 wildfire season (June 21, 2019). Fitch believes compliance
would be costly and difficult in light of the company's financial
challenges and imminent bankruptcy filing.
Recent Regulatory Developments: The CPUC issued a scoping memo and
ruling in its second phase investigation into PG&E's and PCG's
safety culture. The proceeding is expected to cast a wide net in
the CPUC's examination of better ways to provide safe energy
service to Northern California at just and reasonable rates. The
CPUC investigation will consider changes in corporate governance,
management, structure and ownership models and if it should link
return on equity to safety performance. Opening and reply briefs
are scheduled to be submitted by PG&E and other relevant parties in
January and February 2019.
In addition to its efforts to address PG&E's safety challenges, the
commission in December 2018 opened a rulemaking to consider and
adopt a methodology to be applied in future requests for wildfire
cost recovery as directed in S.B 901. The rulemaking will evaluate
methodologies to implement the stress test and cap on wildfire
related cost disallowances required under S.B. 901. CPUC authorized
the rulemaking on Jan. 10, 2019 during its open meeting and a
methodology could around mid-year.
Parent-Subsidiary Rating Linkage: Operating utility PG&E accounts
for virtually all of PCG's consolidated earnings and cash flows. As
such, Fitch applies a weaker parent-stronger subsidiary approach in
applying the agency's parent-subsidiary rating criteria. PCG is
dependent on cash flows from PG&E to meet its ongoing obligations.
PCG's IDR is the same as PG&E's, reflecting the parent's dependence
on the utility to meet its ongoing obligations, relatively low
parent-only debt and structural subordination of PCG debt relative
to PG&E.
Cost Recovery Remains Uncertain: While S.B. 901 did not address
equitable distribution of catastrophic wildfire-related costs or
inverse condemnation, it does provide a potential path to recovery
of wildfire liabilities and establishes a commission -- the
Commission on Catastrophic Wildfire Cost Recovery -- to consider
and make recommendations regarding such costs to the Legislature by
July 1, 2019. However, the methods, timing and implementation of
mechanisms to facilitate recovery of prudently incurred costs by
the IOUs are yet to be established by the commission.
CA Regulatory Compact: California is prone to natural disasters and
a relatively high degree of political risk, dating back to the
energy crisis of 2001-2002. S.B. 901 is a constructive development
in that regard, providing a path to recover prudently incurred
wildfire-related liabilities. However, catastrophic wildfire costs
not deemed to be just and reasonable by the CPUC are not
recoverable under S.B. 901 and timing of such recoveries remains
uncertain.
This prudency aspect associated with the utility's role in wildfire
causation differs from natural disasters, such as hurricanes, and
brings with it risk of meaningful but undefined financial pressure.
Given the unprecedented size of recent wildfires future multi-notch
downgrades cannot be ruled out.
DERIVATION SUMMARY
PG&E is one of the nation's largest utilities with total assets, as
of Sept. 30, 2018, of $71.2 billion, considerably larger than SCE's
$53.4 billion and APS's $17.5 billion. The regulatory environment
in Arizona, similar to California prior to the wildfires, has
generally been supportive from a credit point of view with both
jurisdictions providing utilities operating in the state with a
reasonable opportunity to earn their authorized returns on equity.
However, unlike APS, meaningful uncertainty regarding exposure to
future firestorms and potentially large, related third party
liabilities with uncertain prospects for timely and full recovery
increases business risk for PG&E and SCE. While SCE has been hit by
significant wildfires, they are smaller and more manageable, in
Fitch's view, compared to the 2017 NorCal and 2018 Camp fires that
burned large portions of PG&E's service territory. The magnitude of
the wild fires combined with other operating, safety and liquidity
challenges presents an existential threat to PG&E and its corporate
parent.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
Include:
- PCG and PG&E file for bankruptcy protection before the end of
January 2019;
- Exposure to third-party liabilities related to 2017 and 2018
wildfires of $30 billion;
- No near-term legislative solution to ameliorate wildfire
liability.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
- Credit rating upgrades are unlikely in the face of pending
insolvency. However, a legislative solution that enables the
utility to avoid filing for bankruptcy protection would lead to
future positive rating actions.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
- The expected filing of PCG and PG&E in bankruptcy later this
month is expected to result in further downgrades to 'D'.
LIQUIDITY
Liquidity Challenges: As of Jan. 11, 2019, PCG and PG&E had
approximately $0.4 billion and $1.1 billion, respectively, of cash
and cash equivalents on hand. In November 2018, PCG and PG&E drew
down all the remaining amounts then available under their revolving
credit facilities. PG&E has indicated that it is currently in
negotiation with potential lenders to secure approximately $5.5
billion in debtor-in-possession financing.
FULL LIST OF RATING ACTIONS
Fitch has downgraded the following ratings:
PG&E Corporation
-- Long-Term Issuer Default Rating (IDR) to 'C' from 'BBB-';
-- Senior unsecured revolver to 'C'/'RR6' from 'BBB-';
-- Short-Term IDR to 'C' from 'F3';
-- CP to 'C' from 'F3'.
Pacific Gas and Electric Company
-- Long-Term IDR to 'C' from 'BBB-';
-- Senior unsecured notes to 'CC'/'RR3' from 'BBB';
-- Senior unsecured revolver to 'CC'/'RR3' from 'BBB';
-- Preferred stock to 'C'/'RR6' from 'BBB-';
-- Short-Term IDR to 'C' from 'F3';
-- CP to 'C' from 'F3'.
PG&E CORP: S&P Lowers ICR to 'CC' on Expected Bankr. Filing
-----------------------------------------------------------
S&P Global Ratings, on Jan. 14, 2019, lowered the issuer credit
ratings on utility holding company PG&E Corp. and subsidiary
Pacific Gas & Electric Co. (Pac Gas) to 'CC' from 'B', and lowered
the short-term rating on both entities to 'C' from 'B'.
S&P said, "We also lowered the rating on Pac Gas' unsecured debt to
'CC' from 'BB-'. We maintained the ratings on CreditWatch with
negative implications. We initially placed the ratings on
CreditWatch with negative implications on Nov. 15, 2018, and
subsequently lowered the ratings by multiple notches on Jan. 7,
2019, and maintained them on CreditWatch. The recovery rating on
the unsecured debt is unchanged at '1', reflecting our expectation
of a very high recovery (90% or greater)."
PG&E Corp. announced that it expects to file for bankruptcy on Jan.
29, 2019, as a result of potentially substantial liabilities and
associated challenges related to a series of catastrophic wildfires
in Northern California in 2017 and 2018.
The rating downgrades reflects PG&E's announcement that it expects
to file for bankruptcy protection and commence a reorganization
under Chapter 11 of the U.S. Bankruptcy Code on Jan. 29, 2019.
The CreditWatch negative placement reflects the company's
announcement that it is not likely to make a $21.6 million interest
payment due on its 5.4% senior notes due Jan. 15, 2040, and will
likely file for bankruptcy protection on Jan. 29, 2019.
QEP RESOURCES: Fitch Cuts IDR to BB-; Still on Rating Watch Neg.
----------------------------------------------------------------
Fitch Ratings has downgraded QEP Resources, Inc.'s Issuer Default
Rating (IDR) to 'BB-' from 'BB' and the senior unsecured debt
ratings to 'BB-'/'RR4' from 'BB'/'RR4' following the announcement
that the company has completed the sale of its Haynesville assets.
The watch remains on Rating Watch Negative.
The downgrade reflects the reduction in size, scale and
diversification upon the sale of the Haynesville assets, as well as
the previous sale of the Uinta assets. The divestiture follows the
company's announcement in March 2018 that it was taking strategic
initiatives to transition to a pure play Permian basin company.
Proceeds will be used to repay debt and fund 2019 capex; however,
Fitch believes the 'BB-' rating better reflects the new asset and
production profile and captures the potential risk of pursuing
transactions to generate further inventory and scale.
The Rating Watch Negative reflects the planned sale of the Bakken
assets, which would further reduce the size, scale and
diversification of QEP. Completion of the sale could result in a
potential one-notch downgrade to 'B+'. Proceeds are anticipated be
used to further reduce debt, fund capex and repurchase shares.
Fitch views the Permian-focused strategy favorably, but the smaller
size of the company combined with the increased risk of using
capital to grow inventory is better reflected in the high 'B'
range. In addition, the Rating Watch also reflects the proposal
announced on Jan. 7, 2019 from Elliott Management Corp. (Elliott)
to acquire QEP for $8.75 per share.
KEY RATING DRIVERS
Repositioning Asset Base: In March 2018, QEP announced that it
would focus on becoming a pure Permian operator. QEP closed on
their Pinedale divestiture in September 2017, completed their
Permian acquisition in October 2017, closed on the Uinta
divestiture in July 2018, and completed the sale of their
Haynesville sale on Jan. 10, 2019. In addition, QEP has entered
into an agreement to sell its Williston Basin assets for
approximately $1.725 billion. Following that sale, QEP will achieve
its goal of becoming a pure Permian Basin operator. Fitch believes
that the Permian is an attractive asset, however, QEP's core
acreage and production size is smaller than other producers in the
basin, such as Concho, EOG Resources, Pioneer Natural Resources and
XTO Energy.
Manageable Leverage Expected: Following the Haynesville sale, Fitch
expects QEP to use proceeds to repay its credit facility and fund
its 2019 capex program. Fitch estimates 2019 pro forma net
debt/EBITDA of 2.4x, and Fitch expects QEP to operate in that range
going forward. QEP has consistently managed low leverage metrics
even in the downturn, with debt/EBITDA peaking in 2016 at 3.3x.
Assuming the Bakken divestiture is completed, Fitch forecasts 2019
pro forma net debt/EBITDA to decline to 1.3x.
Proposed Elliott Bid: On Jan. 7, 2019, Elliott, one of QEP's
largest shareholders (approximately 5%) announced a preliminary
proposal to acquire QEP for $8.75 per share in cash, a 44% premium
to the closing price, subject to certain conditions. At this time,
it is uncertain whether a transaction will be completed. The bonds
include a 101 change of control provision, but it is unclear
whether the financing could be structured to avert the provision.
Shareholder Friendly Actions: Concurrently announced with the asset
sales was a unanimously authorized share buyback program for $1.25
billion; however, only $58 million has been repurchased since the
announcement. Originally, Fitch expected proceeds from the asset
sales to be used in part for the buyback program. Instead, QEP has
applied proceeds of the Uinta sale to reducing debt and funding
capex, and has indicated it will do the same with proceeds from the
Haynesville divestiture. Assuming the Bakken transaction is
completed, Fitch expects proceeds will be used to repay debt, fund
capex and repurchase shares. The share buybacks at the expense of
size, scale and cash flow was a previous downgrade sensitivity.
Negative to Neutral FCF: Fitch expects QEP's Permian assets to be
FCF negative until 2020 when it reaches cash flow neutrality based
on the agency's current price deck. The FCF deficits will be funded
with the expected asset sales. The move to neutral FCF is a credit
positive but is done at the expense of production size and
diversification.
Focus on the Permian: The 44,000 net acres in the Permian
currently have about 1,800 drilling locations, which translates to
8-15 years of drilling inventory based on pacing. Further debt
funded Permian acquisitions are expected to increase the running
room in the basin.
DERIVATION SUMMARY
Following the sale of the Haynesville assets, QEP will primarily be
an oil-based producer. Pro forma production of 83 mboe/d is at a
level similar to higher-rated, 'B' issuers, such as SM Energy
(B+/Stable), a Permian/Eagle Ford producer more weighted to gas,
and Extraction (B+/Stable), a rapidly growing producer in the DJ
Basin. Fitch estimates pro forma reserves approximately in the
400mmboe-450mmboe range, which is also on the low side for 'BB'
issuers. QEP lacks the core acreage and production size and scale
that higher rated peers, such as Concho Resources Inc. (BBB/Stable)
has in the Permian Basin and Newfield Exploration Co.
(BBB-/Positive) has in the Anadarko Basin. However, the company's
financial profile, as measured by debt/EBITDA, is generally
consistent with higher rated peers. Fitch estimates 2019 pro forma
debt/EBITDA in the 2.4x range, which is in-line with Murphy Oil
(BB+/Stable), a diversified producer with onshore and offshore
operations, and Southwestern Energy (BB/Stable), a
Marcellus-focused natural gas producer.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
-- WTI oil price of $65.50/barrel in 2018, $57.50 in 2019 and
2020, and long-term price of $55/barrel;
-- Henry Hub gas of $3.10/mcf in 2018, $3.25 in 2019 and a
long-term price of $3.00/mcf;
-- Haynesville divestiture in January 2019 for net proceeds of
$640 million;
-- Production declines by 41% from Haynesville sale, and grows in
low-teens primarily from development of the Permian;
-- No other acquisitions, divestitures, dividends or stock
buybacks are assumed. Proceeds from the Haynesville sale will be
used to repay debt and fund the 2019 development program.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- If the proposed Williston divestiture does not occur, the IDR
would likely be affirmed at 'BB-' and the Rating Watch Negative
Outlook would be resolved.
In either case, sensitivities would be as follows:
-- Increased production size and scale in the Permian basin;
-- Mid-cycle debt/EBITDA at or below 3.0x;
-- Debt/flowing barrel under $15,000 and/or debt/1P below
$5.00/boe on a sustained basis.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Upon the completion of the proposed Williston divestiture the
IDR would likely be downgraded to 'B+' and the Rating Watch
Negative would be resolved.
At that time, sensitivities would be as follows:
-- Expectation of mid-cycle debt/EBITDA above 4.0x;
-- Inability to meet expected production growth from Permian
Basin acreage;
-- Shareholder-friendly actions that result in a material
increase in leverage.
LIQUIDITY
Adequate Liquidity: QEP's liquidity is provided by the company's
$1.25 billion unsecured revolver due in September of 2022. As of
Sept. 30, 2018, QEP had $375.5 million outstanding on its revolver,
which is expected to be repaid with proceeds from the Haynesville
divestiture. The credit facility contains certain covenants that
may limit the amount of borrowing capacity, including a
consolidated leverage ratio not to exceed 3.75x after Dec. 31, 2018
and a Present Value to Consolidated Net Funded Debt Ratio of at
least 1.4x in 2019.
Extended Maturity Profile: QEP's maturity profile is clear until
2020 when approximately $51.7 million of notes are due, with $397.6
million, $500 million and $650 million due in 2021, 2022 and 2023,
respectively.
FULL LIST OF RATING ACTIONS
QEP Resources, Inc.
-- Long-term IDR downgraded to 'BB-' from 'BB';
-- Unsecured revolver and notes downgraded to 'BB-'/'RR4' from
'BB'/'RR4'.
The Rating Watch is Negative.
QEP RESOURCES: S&P Cuts ICR to to 'BB-', On CreditWatch Negative
----------------------------------------------------------------
S&P Global Ratings noted that U.S.-based oil and gas company QEP
Resources Inc. announced it has closed the sale of its Haynesville
and Cotton Valley assets to Aethon III (not rated) for $735
million. S&P expects the company to use the proceeds to pay down
their revolving
credit facility, as well as fund a portion of their 2019 capital
expenditure program. The sale reduces the scale of QEP's
operations, asset diversity, and product mix. Expected financial
measures have weakened following the recent reduction in S&P's
expected West Texas Intermediate (WTI) crude oil price
assumptions.
S&P, on Jan. 11, 2019, lowered the issuer credit and senior
unsecured ratings on QEP Resources to 'BB-' from 'BB'.
The ratings on QEP remain on CreditWatch with negative
implications, reflecting the potential to lower ratings further
following the sale of its Williston Basin assets if proceeds do not
adequately address upcoming debt maturities, or S&P views the
resulting scale and asset diversity, including expectations for
growth, as inconsistent with the current rating.
S&P said, "The downgrade reflects our assessment of QEP's smaller
scale of operations as well as more limited asset and product
diversity following the sale of its Haynesville/Cotton Valley
assets to Aethon III, an affiliate of Aethon Energy Management LLC
(not rated). Pro forma for the sale we estimate total proved
reserves of 420 million barrels of oil equivalent (mmboe) and
production of roughly 80,000 boe per day. We view this as more
consistent with 'BB-' peers such as CNX Resources Corp. or Gulfport
Energy Corp. QEP will now focus on its Permian and Williston basin
assets, although the pending sale of the Williston assets will
further reduce scale and asset diversity. We believe that asset and
product diversity provide a cushion to regional and product price
fluctuations such as the wide oil price differentials recently seen
in the Permian Basin, as well as potential changes in regulatory
requirements, extreme weather, and other basin-specific events. In
addition, expected financial measures have weakened from previous
expectations, despite expected debt repayment with proceeds,
following the recent reduction in our price assumptions for WTI in
2019 and 2020 (2019 assumptions was reduced $10 per barrel to $50
and 2020 by $5 per barrel to $50. Pro forma for the Haynesville
sale we expect funds from operations (FFO)/debt to average between
20% and 30%, and debt/EBITDA between 3x and 4x."
The negative CreditWatch reflects the potential to lower the
ratings on QEP following the close of the Williston sale, due to
its reduced scale and asset diversity as well as uncertainty
regarding the use of proceeds. S&P said, "If the sale is not
executed, we could potentially lower the rating if the company does
not take steps to adequately address its upcoming maturities. We
expect to resolve the CreditWatch placement around the close of the
Williston Basin sale, which we expect to occur late in the first
quarter or early second quarter of 2019."
RANDAL D. HAWORTH: Taps Lafollette Johnson as Special Counsel
-------------------------------------------------------------
Randal D. Haworth, M.D., Inc., seeks approval from the U.S.
Bankruptcy Court for the Central District of California to hire
Louis H. DeHaas of Lafollette Johnson as special counsel effective
November 27, 2018.
It is necessary forthe Debtor to engage the services of special
counsel to represent its rights in the alleged medical malpractice
case of Galasso v. Haworth currently pending before the California
Superior Court.
Louis H. DeHaas, shareholder of Lafollette Johnson, attests that he
and members of the Lafollette Johnson are disinterested as that
term is defined in 11 U.S.C. Sec. 101(14).
The firm can be reached at:
Louis H. DeHaas, Esq.
Lafollette Johnson
865 South Figueroa Street, 32nd Floor
Los Angeles, CA 90017-5431
Phone: (213) 426-3600
Fax: (213) 426-3650
E-mail: ldehaas@ljdfa.com
About Randal D. Haworth
Randal D. Haworth M.D. Inc. filed a Chapter 11 bankruptcy petition
(Bankr. C.D. Cal. Case No. 18-16306) on May 31, 2018, estimating
less than $1 million in assets and liabilities.
The Debtor tapped Havkin & Shrago, Attorneys At Law, as counsel.
Elliot M. Hirsch was appointed as patient care ombudsman in the
Debtor's case.
On Aug. 9, 2018, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. Buchalter is the
Committee's legal counsel.
REEL AMUSEMENTS: Secured Creditors' Treatment Modified in New Plan
------------------------------------------------------------------
Reel Amusements LLC filed with the U.S. Bankruptcy Court for the
Middle District of Tennessee a first amended and restated
disclosure statement in support of its first amended and restated
chapter 11 plan of reorganization dated Jan. 4, 2018.
The amendments within this filing dated Jan. 4, 2019 include the
following:
i. The treatment provided to NBKC Bank was modified.
ii. The treatment provided to Seacoast National Bank was modified.
iii. The treatment provided to BB&T was modified.
iv. The treatment provided to Tiger Leasing was modified.
v. The treatment to secured creditors US Bank, PNC Bank, and
Western Equipment Financing were clarified to state that the
Allowed Secured Claims would be reduced by the amounts, if any, the
respective creditor received from Adequate Protection Payments.
vi. Incorporation of certain revisions, clarifications and
additional disclosure information upon suggestion and inquiry by
the United States Trustee.
The Allowed Secured Claim of NBKC Bank will be allowed in the
amount of $12,500. This Allowed Secured Claim will be paid under
the Plan as follows:
(i) Thirty equal monthly installments of principal and interest
shall be made in the amount of $449.74. (ii) Interest shall accrue
at the fixed rate of 6%. (iii) The first monthly installment
payment will be due on the 1st day of the first month following the
Effective Date and subsequent payments will be due on the 1st day
of each month thereafter until the Allowed Secured Claim is paid in
full. (iv) Any terms of the existing note and security agreement
evidencing this Allowed Claim which may conflict with the terms of
the Plan will be deemed modified by the terms of this Plan.
The Allowed Secured Claim of Seacoast National Bank will be allowed
in the amount of $12,500. This Allowed Secured Claim shall be paid
under the Plan as follows:
(i) Thirty equal monthly installments of principal and interest
shall be made in the amount of $449.74. (ii) Interest shall accrue
at the fixed rate of 6%. (iii) The first monthly installment
payment will be due on the 1st day of the first month following the
Effective Date and subsequent payments will be due on the 1st day
of each month thereafter until the Allowed Secured Claim is paid in
full. (iv) Any terms of the existing note and security agreement
evidencing this Allowed Claim which may conflict with the terms of
the Plan shall be deemed modified by the terms of this Plan.
A copy of the First Amended Disclosure Statement is available at
https://is.gd/XgQUyb from Pacermonitor.com at no charge.
About Reel Amusements
Reel Amusements has been a growing business for over 20 years and
continues to be one of the leaders in the amusement industry.
Reel Amusements LLC filed a petition seeking relief under Chapter
11 of the Bankruptcy Code (Bankr. M.D. Ten. Case no. 18-05883) on
Aug. 31, 2018. At the time of filing, the Debtor estimated
$500,001 to $1 million in assets and $1 million to $10 million in
liabilities. Denis Graham (Gray) Waldron at Niarhos & Waldron,
PLC, is the Debtor's counsel.
REMARKABLE HEALTHCARE: Unsecureds to Recoup 5-10% Under New Plan
----------------------------------------------------------------
Remarkable Healthcare of Carrollton, LP, and its affiliated debtors
and debtors-in-possession, Remarkable Healthcare of Dallas, LP,
Remarkable Healthcare of Fort Worth, LP, Remarkable Healthcare of
Seguin, LP, and Remarkable Healthcare, LLC, filed an amended plan
of reorganization and an accompanying amended disclosure statement
to increase the recovery of general unsecured creditors to 5-10%.
Classification of Claims against Remarkable Healthcare of
Carrollton, LP:
Class 2 - Secured Non-Tax Claims - Comerica Bank. Estimated
number of claims are three and allowed amount of claim around
$831,643. Estimated Recovery: 75%.
Class 3 - Secured Non-Tax Claims Montgomery Capital Partners I,
LP. Estimated number of claims are two and allowed Amount of claim
around $99,117.
Class 7 - Unsecured Deficiency Claims of Montgomery Capital
Partners I, LP. Only one estimated claim and the allowed amount of
claim is still pending. Estimated recovery: 5-10%.
Class 8 - General Unsecured Claims. Estimated number of claims
are 94 and the allowed amount of claim is pending. Estimated
recovery: 5-20%.
Classification of Claims against Remarkable Healthcare of Dallas,
LP:
Class 1 - Secured Non-Tax Claims - Comerica Bank. Estimated
number of claims are three and allowed amount of claim around
$831,643. Estimated recovery: 75%.
Class 2 - Secured Non-Tax Claims - Montgomery Capital Partners
I, LP. Estimated number of claims are 2 and allowed amount of claim
around $99,117.
Class 6 - Unsecured Deficiency Claims of Montgomery Capital
Partners I, LP. Estimated number of claim is only 1 and allowed
amount of claim is pending. Estimated recovery: 5-10%.
Class 7 - General Unsecured Claims. Estimated number of claims
are 99 and allowed amount of claim is pending. Estimated recovery:
5-10%.
Class 8 - Equity Interests. Estimated number of claims are 5.
Classification of Claims against Remarkable Healthcare of Fort
Worth, LP:
Class 2 - Secured Non-Tax Claims - Comerica Bank. Estimated
number of claims are 3 allowed amount of claim around $831,643.
Estimated recovery: 75%.
Class 3 - Secured Non-Tax Claims - Montgomery Capital Partners
I, LP. Estimated number of claims are 2 and allowed amount of
claims around $99,117.
Class 7 - Unsecured Deficiency Claims of Montgomery Capital
Partners I, LP. Only one estimated claim and the estimated allowed
amount is pending. Estimated recovery: 5-10%.
Class 8 - General Unsecured Claims. estimated number of claims
are 118 and allowed amount of claim is pending. Estimated recovery:
5-10%
Class 9 - Equity Interests. Estimated number of claims are 5.
Classification of Claims against Remarkable Healthcare of Seguin,
LP:
Class 1 - Secured Non-Tax Claims - Comerica Bank. Estimated
number of claims are 3 and allowed amount around $831,643. Estimate
recovery: 75%.
Class 2 - Secured Non-Tax Claims - Montgomery Capital Partners
1, LP. Estimated number of claims are 2 and allowed amount of claim
is around $99,117.
Class 6 - Unsecured Deficiency Claims of Montgomery Capital
Partners I, LP. Only 1 estimated claim and allowed amount of claim
is pending. Estimated recovery: 5-10%.
Class 7 - General Unsecured Claims. Estimated number of claims
are 131 and allowed of claim is pending. Estimated recovery:
5-10%.
Class 8 - Equity Interests. Estimated number of claims are 5.
Classification of Claims against Remarkable Healthcare, LLC:
Class 1 - Secured Non-Tax Claims - Comerica Bank. Estimated
number of claims are 3 and allowed amount of claim around $831,643.
Estimated recovery: 75%.
Class 2 Secured Non-Tax Claims - Montgomery Capital Partners I,
LP. Estimated number of claims are 2 and the allowed amount of
claim is around $99,117.
Class 3 - Secured Non-Tax Claims - Mustang NH, LLC. Estimated
number of claim is only 1.
class 4 - Secured Non-Tax Claims - PeopleFund. Estimated number
of claim is only 1.
Class 6 - Unsecured Deficiency Claims of Montgomery Capital
Partners I, LP. Estimated number of claim is only 1 allowed amount
of claim is pending. Estimated recovery: 5-10%.
Class 7 - General Unsecured Claims. Estimated number of clams
are 18 and allowed amount is pending. Estimated recovery: 5-10%
Generally, the Plan is a Chapter 11 plan that obtains new financing
to pay off existing secured lenders and vests the assets of the
Debtors' estates in the Reorganized Debtors to be administered by
the Reorganized Debtors. The Debtors retained Griffin Financial
Group, LLC, to seek interest in new financing for the Debtors.
Historically, the Debtors have maintained gross revenues
aggregating approximately $2,350,000 per month. Post petition
revenues have been trending upward in comparison with revenues over
the same period in 2017. The Debtors' assets consist largely of
accounts receivable (AR) and cash in the total amount of
approximately $10,050,000. The Debtors also scheduled approximately
$150,000 in office FFE and perishable inventory and listed other
assets.
A full-text copy of the Disclosure Statement date December 20,
2018, is available at:
http://bankrupt.com/misc/txeb18-18-40295-227.pdf
About Remarkable Healthcare
Remarkable Healthcare operates skilled nursing facilities in
Dallas, Fort Worth, Prestonwood and Seguin, Texas. All Remarkable
facilities are designed to meet the needs of patients requiring
post-acute recovery and therapy or residents needing a longer-term
stay. Services are tailored to each individual with the goal of
facilitating increased strength and mobility while minimizing pain
and impairment. Remarkable's programs are designed to help
patients recover quickly from surgery, injury, or serious illness
and speed up the recovery process.
Remarkable Healthcare of Carrollton, LP and its affiliates filed
voluntary petitions (Bankr. E.D. Tex. Lead Case No. 18-40295) on
Feb. 12, 2018, seeking relief under Chapter 11 of the Bankruptcy
Code.
In the petitions signed by Laurie Beth McPike, president of LBJM,
LLC, its general partner, Remarkable Healthcare of Carrollton,
Remarkable Healthcare of Dallas, Remarkable Healthcare of Fort
Worth and Remarkable Healthcare of Seguin, each had estimated $1
million to $10 million in assets and liabilities; and Remarkable
Healthcare had $100,000 to $500,000 in estimated assets and $1
million to $10 million in estimated liabilities.
Mark A. Castillo, Esq., at Curtis Castillo PC, serves as the
Debtors' counsel.
The Office of the U.S. Trustee on March 19, 2018, appointed two
creditors to serve on an official committee of unsecured creditors
in the Chapter 11 cases. The Committee tapped Searcy & Searcy,
P.C., as its legal counsel.
REPUBLIC METALS: Chose Valcambi SA as Stalking Horse Bidder
-----------------------------------------------------------
BankruptcyData.com reported that Republic Metals Refining Corp, et
al., notified the Court hearing the Republic Metals Corporation
("RMC") case that, pursuant to a stalking horse agreement (the
"Stalking Horse APA") entered into as of January 9, 2019, the
Debtors had selected Swiss metals refiner Valcambi SA as its
stalking horse bidder. According to Court filings, the parties have
agreed a purchase price of $16 million including a cash deposit of
$3.2 million.
Further to the Stalking Horse APA, Valcambi shall be entitled to a
break-up fee of 3% of its opening bid, or $480,000, if it is not
the successful bidder at the Auction. Any further bidders must
submit an initial minimum overbid of at least $16,580,000, in order
to be considered a "Qualified Bid" and subsequent minimum overbids
at an Auction, if held, shall be in increments of $100,000.
BankruptcyData related that the Debtors and Valcambi have come
close to a deal before, with Valcambi going as far as issuing a
press release announcing a deal on October 29, 2018. At the time,
Valcambi stated that the deal was subject only "to completion of
the final steps of due diligence." Something must have been spotted
during those final steps as the deal (for which terms were never
announced) clearly melted down, with the Debtors filing for
bankruptcy protection just days later, BankruptcyData noted.
The proposed timeline for the transaction is as follows:
Bid Deadline January 28, 2019 at 5:00 p.m.
Objection Deadline January 29, 2019
Auction (if necessary) January 31, 2019,
Sale Hearing On or before February [4-8]
About Republic Metals Refining
Founded in 1980, Republic Metals Refining Corporation and its
affiliates are refiner of precious metals with a primary focus on
gold and silver. They 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 Republic for refining from all over
The United States and the Western Hemisphere. They provide their
products and services to a diverse base of global mining
corporations, financial institutions and jewelry manufacturers.
Republic Metals Refining, Republic Metals Corporation and Republic
Carbon Company, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case Nos. 18-13359 to 18-13361) on
Nov. 2, 2018.
In the petition signed by CRO Scott Avila, Republic Metals Refining
estimated assets of $1 million to $10 million and liabilities of
$100 million to $500 million.
The Debtors tapped Akerman LLP as their legal counsel; Paladin
Management Group, LLC as financial advisor; and Donlin, Recano &
Company, Inc., as claims and noticing agent.
On Nov. 19, 2018, the Office of the United States Trustee for
Region 2 appointed an official committee of unsecured creditors.
The Committee retained Cooley LLP, as counsel; and CBIZ Accounting,
Tax & Advisory of New York, LLC, and CBIZ, Inc., as financial
advisor.
ROBERT T. WINZINGER: Plan Confirmation Hearing Set for Feb. 7
-------------------------------------------------------------
Bankruptcy Judge Kathryn C. Ferguson approved Robert T. Winzinger,
Inc.'s disclosure statement referring to a chapter 11 plan dated
Dec. 26, 2018.
Written acceptances, rejections or objections to the plan must be
filed not less than seven days before the hearing on confirmation
of the plan.
Feb. 7, 2019 at 2:00 p.m. is fixed as the date and time for hearing
on confirmation of the plan.
A copy of the Second Modified Disclosure Statement is available at
https://tinyurl.com/yamcasjs from PacerMonitor.com at no charge.
About Robert T. Winzinger
Founded in 1960, Robert T. Winzinger, Inc. -- http://winzinger.com/
-- is a full-service contractor for roads, excavation, land
development and demolition, utility and marine construction, and
recycling technologies. Winzinger is certified as a W.B.E. with
the NJ Dept. of Treasury - Division of Property Management &
Construction; Licensed Contractor with City of Philadelphia; Small
Business Enterprise with the City of Philadelphia; Small Business
Enterprise with the State of New Jersey; Public Works Contractor
with the State of New Jersey; Home Improvement Contractor with the
State of New Jersey Division of Consumer Affairs; and Maintains a
Certificate of Employee Report with the State of New Jersey.
Robert T. Winzinger, Inc., filed a Chapter 11 petition (Bankr.
D.N.J. Case No. 17-25972) on Aug. 7, 2017. The petition was signed
by Audrey Winzinger, vice president, secretary, and treasurer. At
the time of filing, the Debtor estimated $10 million to $50 million
in assets and $1 million to $10 million in liabilities.
The case is assigned to Judge Kathryn C. Ferguson.
The Debtor is represented by David A. Kasen, Esq., at Kasen &
Kasen.
SALSGIVER INC: Unsecured Creditors to Recover 60% Over 72 Months
----------------------------------------------------------------
Salsgiver, Inc. filed with the U.S. Bankruptcy Court for the
Western District of Pennsylvania a disclosure statement to
accompany its proposed plan dated Jan. 4, 2019.
Salsgiver, Inc. is the 100% owner of two subsidiary entities, i.e.
Salsgiver Telecom, Inc. and Salsgiver Communications, Inc. All
three entities are debtors.
All three debtors are providing for 100% payment of allowed
secured, administrative and priority claims in their cases and 60%
of unsecured claims in their cases. It is anticipated that many
claim objections will be filed and all three debtors believe that
various claims asserted in the three Chapter 11 Cases will be
significantly reduced as multiple asserted claims are grossly
excessive.
All three debtors also anticipate commencing adversary proceedings
seeking money damages. If the debtors are successful in such
litigation, they will, if able, accelerate payments provided for in
their plans. However, the debtors do not need to be successful in
their litigation to hind their plans. All funding required can be
provided via ongoing business operations.
All three debtor plans provide, where applicable, full payment of
allowed secured claims in accordance with existing contractual
obligations with liens retained until paid in full, full payment of
allowed administrative claims on the Plan Effective Date, full
payment of allowed priority claims no later than a 60-month period
in equal monthly installments commencing on the Plan Effective Date
and 60% payment of allowed unsecured claims over a 72-month period
in yearly installments commencing one year after the Plan Effective
Date.
While revenues and expenses of each entity can be attributed to
each entity, subsidization of the affiliates is sometimes
necessary, particularly for Communications. As such, all three
debtors will be pooling their resources to make plan payments, all
of which will be made out of Inc. accounts into which all three
debtors’ revenues flow.
A copy of the Disclosure Statement is available at
https://tinyurl.com/ybkpqwb4 from Pacermonitor.com at no charge.
About Salsgiver Inc.
Based in Freeport, Pennsylvania, Salsgiver Inc. --
http://gotlit.com/-- and -- http://www.salsgiver.com/-- is a
wired telecommunications carrier offering internet, phone and video
services to residential and business clients. The company also
provides telecom services.
Salsgiver and its affiliates Salsgiver Telecom, Inc. and Salsgiver
Communications, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Pa. Case Nos. 18-20803, 18-20805 and
18-20806) on March 2, 2018.
In their petitions signed by Loren M. Salsgiver, president, the
Debtors estimated assets of less than $50,000. Salsgiver disclosed
$1 million to $10 million in liabilities. Salsgiver Telecom
estimated less than $500,000 in liabilities while Salsgiver
Communications estimated less than $50,000 in liabilities.
Judge Jeffery A. Deller presides over the bankruptcy case of
Salsgiver Telecom. The two other cases have been assigned to Judge
Thomas P. Agresti.
SANDRA W RUTHERFORD: Seeks to Hire Dunn Cooper as Accountant
------------------------------------------------------------
The attorney representing Sandra W. Rutherford Revocable Trust
Agreement Dated May 2, 2005, As A Business Trust seeks approval
from the U.S. Bankruptcy Court for the Southern District of West
Virginia to hire an accountant.
Joseph Caldwell, Esq., at Caldwell & Riffee, proposes to employ
Dunn, Cooper, Adkins & Reynolds, CPA's, PLLC to prepare its monthly
operating reports, tax returns, financial projections, income
statements and balance sheets.
Michael Dunn, the firm's accountant who will be providing the
services, will charge $300 per month.
Dunn Cooper is "disinterested" as defined in Section 101(14) of the
Bankruptcy Code, according to court filings.
The firm can be reached through:
Michael Dunn
Dunn, Cooper, Adkins & Reynolds, CPA's, PLLC
717 6th Avenue
Huntington, WV 25701
Tel: 304.523.8299
Fax: 304.523.8294
About Sandra W. Rutherford Revocable Trust
Sandra W. Rutherford Revocable Trust Agreement Dated May 2, 2005,
As A Business Trust is a business trust in Lexington, Kentucky.
Sandra W. Rutherford sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. W.Va. Case No. 18-30475) on Nov. 14,
2018. At the time of the filing, the Debtor estimated assets of $1
million to $10 million and liabilities of $1 million to $10
million. Judge Frank W. Volk oversees the case. The Debtor tapped
Caldwell & Riffee as its legal counsel.
SAUK PRAIRIE: Moody's Alters Outlook on B1 Bonds Rating to Stable
-----------------------------------------------------------------
Moody's Investors Service has affirmed Sauk Prairie Healthcare,
Inc., WI's B1 rating. This action affects $38 million of Series
2013A fixed rate bonds issued by the Wisconsin Health and
Educational Facilities Authority. The outlook has been revised to
stable from negative.
RATINGS RATIONALE
Affirmation of the B1 reflects its view that SPH will maintain its
market position, adequate margins and healthy liquidity position.
Moreover, the affirmation incorporates the hospital's improved
headroom to financial covenants, modest capital plans and
manageable indirect debt load. SPH remains challenged by its very
high financial leverage, which limits bondholder recovery rates in
the event of default and debt acceleration. Additionally key
vulnerabilities remain its small size and close proximity to larger
providers in Madison (WI).
RATING OUTLOOK
The stable outlook reflects the hospital's increased headroom to
covenants and expectations that sufficient headroom will be
maintained. The outlook is further supported by an expectation of
steady operating performance and modest capital spending which will
aid liquidity growth.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Significant and sustained improvement in operating performance
- Material improvement in balance sheet and debt metrics
- Significant enterprise and market share growth
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Reduced covenant headroom or covenant breach
- Decline in margins and cash flow
- Weakening of liquidity and debt metrics
LEGAL SECURITY
The Series 2013A bonds are secured by a joint and several security
interest in Pledged Revenues of the Obligated Group and a mortgage
on SPH. Sauk Prairie Memorial Hospital, Inc. is the only member of
the Obligated Group. A debt service reserve fund (DSRF) is in
place.
PROFILE
SPH is a 36 staffed bed, 1,850 admission hospital located in the
Village of Prairie du Sac, WI. Prairie du Sac is located
approximately 27 miles northwest of downtown Madison. While SPH
competes with the three health systems based in Madison, the
hospital also maintains referral partnerships with all three
Madison providers and contracts with each of their respective
provider-owned health plans.
SEMILEDS CORP: Operating Losses Cast Going Concern Doubt
--------------------------------------------------------
SemiLEDs Corporation filed its quarterly report on Form 10-Q,
disclosing a net loss of $983,000 on $972,000 of net revenues for
the three months ended November 30, 2018, compared with a net loss
of $392,000 on $2,003,000 of net revenues for the same period in
2017.
At November 30, 2018, the Company had total assets of $13,213,000,
total liabilities of $8,970,000, and $4,201,000 in total
stockholders' equity.
The Company has suffered losses from operations of $3.7 million and
$4.3 million, and used net cash in operating activities of $1.2
million and $2.1 million for the years ended August 31, 2018 and
2017, respectively. Gross loss on product sales was $435,000 for
the year ended August 31, 2018 and gross profit was $82,000 for the
year ended August 31, 2017. Loss from operations and net cash used
in operating activities for the three months ended November 30,
2018, were $1.0 million and $1.3 million, respectively. Further,
at November 30, 2018, the Company's cash and cash equivalents was
down to $2.6 million. These facts and conditions raise substantial
doubt about the Company's ability to continue as a going concern.
A copy of the Form 10-Q is available at:
https://bit.ly/2VUObxi
Taiwan-based SemiLEDs Corporation and its subsidiaries develop,
manufacture and sell high performance light emitting diodes (LEDs).
The company's core products are LED chips and LED components, as
well as lighting products. SemiLEDs customers are concentrated in
a few select markets, including Taiwan, the United States and
China.
SENIOR NH: Seeks April 22 Exclusive Plan Filing Period Extension
----------------------------------------------------------------
Senior NH LLC requests the U.S. Bankruptcy Court for the Northern
District of Georgia to extend the exclusive periods in which Debtor
can file and solicit acceptances of a Chapter 11 plan through and
including April 22, 2019 and June 21, 2019, respectively.
Unless extended, the Debtor's current exclusive period to file a
plan is slated to expire on Jan. 22, 2019.
The Debtor asserts cause exists for granting the requested
extension of the exclusive periods for filing a Chapter 11 plan and
soliciting acceptances thereto. The Debtor relates that since the
commencement of the case, it has worked diligently to maintain
continuity in the everyday operation of its businesses, while
simultaneously working to preserve and build the value of its
assets.
In addition, the Debtor represents that it has been working on
reviewing claims and reducing costs in an effort to formulate a
feasible plan to repay all creditors in full. Thus, cause exists
to extend the deadlines for filing a Chapter 11 plan and soliciting
acceptances thereto for an additional 90 days.
About Senior NH LLC
Senior NH, LLC, operates a one hundred bed skilled nursing facility
known as the Enid Senior Care located at 410 N. 30th Street, Enid,
Oklahoma.
Senior NH sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. N.D. Ga. Case No. 18-65904) on Sept. 21, 2018. In the
petition signed by Christopher F. Brogdon, managing member, the
Debtor estimated assets of less than $10 million and debt under $50
million. The Debtor tapped Theodore N. Stapleton, Esq., of
Theodore N. Stapleton, P.C., as counsel.
SHIFTPIXY INC: Recurring Losses Casts Going Concern Doubt
---------------------------------------------------------
ShiftPixy, Inc., filed its quarterly report on Form 10-Q,
disclosing a net loss of $2,000,186 on $10,519,990 of revenues for
the three months ended November 30, 2018, compared with a net loss
of $3,341,217 on $6,511,919 of revenues for the same period in
2017.
At November 30, 2018, the Company had total assets of $14,043,710,
total liabilities of $22,288,962, and $8,245,252 in total
stockholders' deficit.
As of November 30, 2018, the Company had cash of $0.2 million and a
working capital deficiency of $12.9 million. During the quarter
year ended November 30, 2018, the Company used approximately $1.6
million of cash in its operation. The Company has incurred
recurring losses resulted in an accumulated deficit of $28 million
as of November 30, 2018. These conditions raise substantial doubt
as to the Company's ability to continue as going concern within one
year from issuance date of the financial statements.
The ability of the Company to continue as a going concern is
dependent upon generating profitable operations in the future and
obtaining additional funds by way of public or private offering to
meet the Company's obligations and repay its liabilities when they
become due.
A copy of the Form 10-Q is available at:
https://bit.ly/2DbpbdJ
ShiftPixy, Inc., provides employment services for businesses; and
workers in shift or other part-time/temporary positions in the
United States. The company also operates as a payroll processor,
human resources consultant, and administrator of workers'
compensation coverages and claims. It primarily serves restaurant,
hospitality, and maintenance service industries. The company was
founded in 2015 and is headquartered in Irvine, California.
STEAM DISTRIBUTION: Plan Confirmation Hearing Scheduled for Feb. 27
-------------------------------------------------------------------
Bankruptcy Judge August B. Landis issued an order approving Steam
Distribution, LLC, Havz, LLC, and One Hit Wonder, Inc. disclosure
statement describing their first amended joint plan of
reorganization.
The hearing to consider confirmation of the Plan Proponents' First
Amended Joint Plan of Reorganization with Substantive Consolidation
for Plan Purposes is set for Feb. 27, 2019, at 1:30 p.m.
The deadline to file objections to the Plan and to submit their
ballots for voting to accept or reject the Plan is Feb. 6, 2019.
The Troubled Company Reporter previously reported that unsecured
creditors will get $1.7 million over 16 quarters.
The Plan will be funded from three primary sources consisting of
(i) the Funds on the Plan Effective Date; (ii) the Plan Proponents'
cash on hand as of the Plan Effective Date; and (iii) from the
positive cash flow generated by the business operations of the
Reorganized Debtors.
A full-text copy of the Disclosure Statement dated December 17,
2018, is available at:
http://bankrupt.com/misc/nvb18-1811598abl-251.pdf
About Steam Distribution
Steam Distribution -- http://www.onehitwondereliquid.com/-- is a
wholesaler and distributor in the vape/e-cig industries.
Handcrafted in Los Angeles, California, One Hit Wonder eLiquid
contains ingredients including TruNic 100% USA grown and extracted
liquid nicotine.
Steam Distribution, LLC, Havz, LLC, d/b/a Steam Wholesale (Bankr.
D. Nev. Case No. 18-11599) and One Hit Wonder, Inc., each filed
voluntary petitions under Chapter 11 of the Bankruptcy Code (Bankr.
D. Nev. Case Nos. 18-11598 to 18-11600), commencing their
bankruptcy cases on March 26, 2018. The petitions were signed by
Robert Hackett, managing member. The Debtors have filed motions
requesting joint administration of their three cases.
At the time of filing, Steam Distribution and One Hit Wonder
estimated assets and liabilities at $1 million to $10 million each,
while Havz estimated $50,000 to $100,000 in assets and $1 million
to $10 million in liabilities.
The Hon. August B. Landis and the Hon. Mike K. Nakagawa are
assigned to these cases.
The Debtors hired Candace C Carlyon, Esq. of Clark Hill PLLC and
John Patrick M. Fritz, Esq. of Levene, Neale, Bender, Yoo & Brill
LLP as counsel.
SURGERY PARTNERS: S&P Lowers Long-Term ICR to 'B-', Outlook Stable
------------------------------------------------------------------
S&P Global Ratings noted that Brentwood, Tenn.-based outpatient
surgical services company Surgery Partners Inc. underperformed
S&P's expectations for organic revenue growth and EBITDA, and
distributions to noncontrolling interest holders (physicians)
increased, exceeding its expectations. S&P now expects free cash
flow deficits (after distributions to noncontrolling interest
holders) for 2018 and 2019, whereas S&P previously forecasts free
cash flow of $20 million-$30 million annually.
S&P is lowering its long-term issuer credit rating to 'B-' from
'B', and lowers the issue-level ratings by one notch. The outlook
is stable.
S&P said, "The rating action reflects our expectation for lower
cash flows in 2018 and 2019 following some operating
underperformance and higher than expected expenses and
distributions to noncontrolling interest holders. We view the free
cash flow deficits (after distributions to non-controlling interest
holders) and very high adjusted leverage in 2018 (about 10x
excluding preferred equity or 12x including preferred equity) as
consistent with a 'B-' rating. We previously expected free cash
flow of $10 million-$20 million in 2018 and $20 million-$30 million
in 2019.
"The stable outlook reflects our expectations for
low-single–digit percentage revenue growth supplemented by
acquisitions and some margin improvement, leading to improving cash
flow in 2019 (about a $10 million deficit) and nearly flat free
cash flow in 2020. That leads us to believe the capital structure
is sustainable in the long term and that the company has the
liquidity to weather this period of restructuring and investment."
TANZANIAN ROYALTY: Financing Requirement Casts Going Concern Doubt
------------------------------------------------------------------
Tanzanian Royalty Exploration Corporation filed its January 2019
report on Form 6-K, disclosing a net loss of CAD2,055,779 on CAD0
of net revenues for the three months ended November 30, 2018,
compared with a net loss of CAD1,829,996 on CAD0 of net revenues
for the same period in 2017.
At November 30, 2018, the Company had total assets of
CAD54,352,077, total liabilities of CAD19,203,370, and $35,148,707
in total stockholders' equity.
In the Form 6-K, Tanzanian Royalty states: "The Company manages
liquidity risk by maintaining adequate cash balances in order to
meet short term business requirements. Because the Company does
not currently derive any production revenue from operations, its
ability to conduct exploration and development work on its
properties is largely based upon its ability to raise capital by
equity funding. Previously, the Company obtained funding via
private placements, public offering and various sources, including
the Company's President and former CEO who is currently still a
director.
"Based on the Company's current funding sources and taking into
account the working capital position and capital requirements at
November 30, 2018, these factors indicate the existence of a
material uncertainty that raises substantial doubt about the
Company's ability to continue as a going concern and is dependent
on the Company raising additional debt or equity financing. The
Company must obtain additional funding in order to continue
development and construction of the Buckreef Project. The Company
presently does not have adequate resources to maintain its core
activities for the next fiscal year or sufficient working capital
to fund all of its planned activities. The Company is continuing
to pursue additional financing to fund the construction of the
Buckreef Project and additional projects. However there is no
assurance that such additional funding and/or project financing
will be obtained or obtained on commercially favourable terms.
"At November 30, 2018 the Company had a working capital deficiency
of CAD12,249,243 (August 31, 2018 - CAD12,010,685 working capital
deficiency), had not yet achieved profitable operations, has
accumulated losses of CAD105,389,586 (August 31, 2018 -
CAD103,263,959). The Company will require additional financing in
order to conduct its planned work programs on mineral properties,
meet its ongoing levels of corporate overhead and discharge its
future liabilities as they come due.
"Some of the Company's mineral properties are being acquired over
time by way of option payments. It is at the Company's option as
to whether to continue with the acquisition of the mineral
properties and to incur these option payments."
A copy of the Form 6-K is available at:
https://bit.ly/2RPytnZ
Tanzanian Royalty Exploration Corporation engages in the
exploration and development of mineral property interests in the
United Republic of Tanzania. The company primarily explores for
gold deposits. It holds interest in the Buckreef project located
in the Geita District of the Geita Region south of Lake Victoria;
the Buziba project situated in the Geita district; the Itetemia
gold deposit located at southwest of Mwanza in northern Tanzania;
and the Kigosi project situated within the Kigosi Game Reserve
controlled area in northwestern Tanzania. The company also holds
interest in various exploration stage projects, including the
Luhala project, which consists of five anomalous hilltops located
in Misungwi District of Mwanza Region of Tanzania; and the Lunguya
property situated in the Kahama District of Tanzania. The company
was formerly known as Tan Range Exploration Corporation and changed
its name to Tanzanian Royalty Exploration Corporation in February
2006. Tanzanian Royalty Exploration Corporation was founded in
1990 and is based in Toronto, Canada.
TREATMENT CENTER: Plan Outline OK'd; Plan Hearing Set for Feb. 14
-----------------------------------------------------------------
Bankruptcy Judge Erik P. Kimball issued an order approving The
Treatment Center of the Palm Beaches, LLC's disclosure statement.
The hearing on confirmation of the Plan has been set for Feb. 14,
2019 at 2:00 p.m.
The last day for filing written acceptances or rejections of the
Plan is Feb. 7, 2019.
The last day for filing and serving objections to confirmation of
the Plan is Feb. 11, 2019.
The Troubled Company Reporter previously reported that the Plan
will be funded with, among other things, the proceeds of the sale
of substantially all of the Debtor's tangible assets any Excluded
Assets, Litigation Claims, and Causes of Action.
A copy of the Disclosure Statement is available for free at:
http://bankrupt.com/misc/flsb18-14622-243.pdf
About The Treatment Center of The Palm Beaches
The Treatment Center of the Palm Beaches, LLC, located in West Palm
Beach, Florida -- https://www.thetreatmentcenter.com/ -- is an
addiction treatment center. Since 2009, Treatment Center has
offered custom treatment programs for drugs, alcohol, trauma,
mental health, and other addictions.
The Treatment Center of the Palm Beaches filed a Chapter 11
petition (Bankr. S.D. Fla. Case No. 18-14622) on April 19, 2018.
In the petition signed by Judi Gargiulo, manager, the Debtor
disclosed $11.07 million in total assets and $6.12 million in total
liabilities.
The case is assigned to Judge Erik P. Kimball.
Robert C. Furr, Esq., at Furr & Cohen, is the Debtor's bankruptcy
counsel.
The court approved the sale of substantially all of the Debtor's
assets to Palm Beach Recovery Center, LLC on Sept. 7, 2018.
On October 16, 2018, the Debtor filed its Chapter 11 plan and
disclosure statement.
TRIBECA FIT: Seeks to Hire Ballon Stoll as Legal Counsel
--------------------------------------------------------
Tribeca Fit, Inc., seeks approval from the U.S. Bankruptcy Court
for the Southern District of New York to hire Ballon Stoll Bader &
Nadler, P.C., as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; represent the Debtor in negotiation with its
creditors; prepare a bankruptcy plan; give advice regarding
tax-related matters; assist the Debtor in any potential sale of its
assets; and provide other legal services related to its Chapter 11
case.
Ballon charges these hourly fees:
Senior Partner $595
Paralegals $90
Vincent Roldan, Esq., a partner at Ballon and the attorney who will
be handling the case, charges an hourly fee of $495. His firm
received a retainer of $23,050 from the Debtor.
Mr. Roldan disclosed in a court filing that his firm is
"disinterested" as defined in section 101(14) of the Bankruptcy
Code.
Ballon can be reached through:
Vincent J. Roldan, Esq.
Ballon Stoll Bader & Nadler, P.C.
729 Seventh Avenue, 17th Floor
New York, New York 10019
Tel: 212-575-7900
Fax: 212-764-5060
Email: vroldan@ballonstoll.com
About Tribeca Fit Inc.
Tribeca Fit, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 18-14214) on Dec. 31,
2018. At the time of the filing, the Debtor estimated assets of
less than $500,000 and liabilities of the same range. Ballon Stoll
Bader & Nadler, P.C., is the Debtor's counsel.
TSC/GREEN ACRES: Amends Manner of Plan Payment
----------------------------------------------
Tsc/Green Acres Road, LLC, filed a third amended Chapter 11 plan to
modify the manner of payment. The Third Amended Plan provides that
"any payment made under the Plan may be made either by check or by
wire transfer, except that the payment of net proceeds to the Class
2 claim holder will be made by immediately available funds at
closing."
Class 4 consists of Allowed General Unsecured Claims other than
Allowed Insider Claims. After all holders of Allowed Administrative
Expense Claims and Allowed Class 1, 2, and 3 Claims have received
payment of the full amount of such Allowed Claims as provided in
the Plan, each holder of an Allowed Class 4 General Unsecured Claim
shall receive a Pro Rata distribution from Available Cash until
such Allowed Class 4 Claims are paid in full. Class 4 is impaired
by the Plan.
Class 1 consists of the Allowed Secured Claims of Anne Arundel
County, Maryland. The holder of the Allowed Claim in Class 1 shall
retain its lien on the Real Property. At closing on the sale of
the Real Property, the Allowed Class 1 Claim shall be paid in full
from Available Cash, with interest at the Legal Interest Rate.
Class 1 is impaired by the Plan.
Class 2 consists of the Allowed Secured Claims of Merritt Lending,
LLC. The holder of the Class 2 Claim shall have an allowed secured
claim of $1,159,884.03 as of March 31, 2018, plus any amounts that
become incurred or accrue under the applicable loan documents
thereafter until such time as the earlier to occur of (i) the Class
2 Claim is paid in full, or (ii) the sale of the Real Property is
closed and the Class 2 Claim holder is paid at closing from the net
sale proceeds. The Class 2 Claim holder shall retain its lien(s) on
the Real Property until such time as the Real Property is sold.
Class 2 is impaired by the Plan.
Class 3 consists of the Allowed Priority Claims, other than
Administrative Expense Claims, Professional Fee Claims, and
Priority Tax Claims. After all holders of Allowed Administrative
Expense Claims and Allowed Class 1 and 2 Claims have received
payment of the full amount of such Allowed Claims as provided in
the Plan, each holder of an Allowed Class 3 Priority Claim shall
receive a Pro Rata distribution from Available Cash until such
Allowed Class 3 Claims are paid in full. Class 3 is impaired by the
Plan.
Class 5 consists of Allowed Insider Claims. After all holders of
Allowed Administrative Expense Claims and Allowed Class 1, 2, 3,
and 4 Claims have received payment of the full amount of such
Allowed Claims as provided in the Plan, each holder of an Allowed
Class 5 Claim shall receive a Pro Rata distribution from Available
Cash until such Allowed Class 5 Claims are paid in full. Class 5 is
impaired by the Plan.
Class 6 consists of Allowed Equity Interests. Upon the Effective
Date, the holder of 100% of the Equity Interest shall retain such
Equity Interest. The holder of the Equity Interest shall not be
entitled, and shall not receive, any distribution of Available Cash
on account of such Equity Interest under the Plan until holders of
all Allowed Claims have been paid in full as provided under the
Plan. Class 6 is impaired by the Plan.
The Reorganized Debtor shall utilize all commercially reasonable
efforts to market the Real Property for sale free and clear of all
liens, claims, encumbrances or interests. While the Property is
marketed, the Debtor will continue to make adequate protection
payments as described above to Merritt Lending, LLC, and Merrit
shall be entitled to periodic reports of the status of marketing,
including monthly contact with the realtor engaged by the Debtor as
set forth in paragraph 5.1.2 above. The liens and security
interests of the holders of Allowed Claims in Classes 1, and 2
shall attach to the proceeds of sale to the same extent, and in the
same priority, as their respective liens and security interests as
of the Petition Date. At closing on the sale of the Real Property,
the Allowed Claims in Classes 1, 2 and 3 shall be paid as provided
in Article V of the Plan.
A full-text copy of the Third Amended Disclosure Statement dated
December 14, 2018, is available at https://tinyurl.com/yaoy8zgk
from PacerMonitor.com at no charge.
A full-text copy of the Second Amended Disclosure Statement dated
November 21, 2018, is available at https://tinyurl.com/y8zmm2ru
from PacerMonitor.com at no charge.
About TSC/Green Acres and
TSC/Nester's Landing
Based in Columbia, Maryland, TSC/Green Acres Road owns in fee
simple interest subdivided lots located at 7345 Green Acres Drive,
Glen Burnie, MD valued by the company at $2.08 million. Its
affiliate TSC/Nester's Landing is also the fee simple owner of a
property located at 1915 Turkey Point Road, Baltimore County
(consisting of subdivided lots) valued at $1.89 million.
TSC/Green Acres Road, LLC and its affiliate TSC/Nester's Landing,
LLC filed separate Chapter 11 bankruptcy petitions (Bankr. D. Md.
Case Nos. 17-25912 and 17-25913, respectively) on Nov. 28, 2017.
Gerard McDonough, trustee for AN&J Family Trust, signed the
petitions.
TSC/Green Acres Road disclosed total assets of $2.57 million and
total liabilities of $2.60 million as of the bankruptcy filing.
TSC/Nester's Landing disclosed total assets of $1.89 million and
total liabilities of $1.69 million.
The Hon. David E. Rice presides over TSC/Green Acres' case, while
the Hon. Robert A. Gordon is assigned to TSC/Nester's Landing's
case.
David W. Cohen, Esq., at the Law Office of David W. Cohen, serves
as counsel to the Debtors.
An official committee of unsecured creditors has not been appointed
in the Chapter 11 cases.
UNIVERSITY PHYSICIAN: Taps AlixPartners as Financial Advisor
------------------------------------------------------------
University Physician Group received approval from the U.S.
Bankruptcy Court for the Eastern District of Michigan to hire
AlixPartners, LLP as its financial advisor.
The firm will assist the Debtor's management in the design and
implementation of a restructuring strategy; help develop a revised
business plan; participate in negotiations with stakeholders;
assist in the preparation of a plan of reorganization; and provide
other financial advisory services related to the Debtor's Chapter
11 case.
AlixPartners charges these hourly fees:
Managing Director $990 – $1,165
Director $775 – $945
Senior Vice-President $615 – $725
Vice-President $440 – $600
Consultant $160 – $435
Paraprofessional $285 – $305
The firm requested a retainer in the sum of $40,000.
Jeffrey Johnston, managing director of AlixPartners, disclosed in a
court filing that his firm is "disinterested" as defined in section
101(14) of the Bankruptcy Code.
AlixPartners can be reached through:
Jeffrey L. Johnston
AlixPartners, LLP
2000 Town Center
Southfield, MI 48075
Office: +1 (248) 204-0685
Mobile: +1 (248) 631-7617
Email: jjohnston@alixpartners.com
About University Physician Group
University Physician Group -- http://www.wsupgdocs.org/-- is a
non-profit multi-specialty physician practice group in southeast
Michigan, providing primary and specialty care. Its doctors
provide medical care while conducting groundbreaking research and
continuing education at Wayne State University, one of the nation's
top medical universities.
University Physician Group sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. E.D. Mich. Case No. 18-55138) on Nov.
7, 2018. At the time of the filing, the Debtor estimated assets of
$10 million to $50 million and liabilities of $10 million to $50
million.
The case has been assigned to Judge Mark A. Randon. The Debtor
tapped Steinberg Shapiro & Clark as lead counsel, and Robert
Bassel, Esq., as co-counsel with Steinberg.
The U.S. Trustee for Region 9 appointed an official committee of
unsecured creditors on Nov. 26, 2018. The committee tapped Pepper
Hamilton LLP as its legal counsel.
UPPER CUTS: Seeks to Hire AP Law Group as Legal Counsel
-------------------------------------------------------
Upper Cuts Gentleman's Grooming Place, LLC, seeks approval from the
U.S. Bankruptcy Court for the District of Columbia to hire AP Law
Group, PLC, as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; assist the Debtor in the preparation of a plan of
reorganization; and provide other legal services related to its
Chapter 11 case.
AP Law Group charges an hourly fee of $300. Mark McIntosh,
co-owner of the Debtor, paid the firm a retainer of $10,000 prior
to the petition date.
Ashvin Pandurangi, Esq., the attorney who will be handling the
case, neither holds nor represents any interest adverse to the
Debtor and its bankruptcy estate, according to court filings.
The firm can be reached through:
Ashvin Pandurangi, Esq.
AP Law Group, PLC
7777 Leesburg Pike, Suite 402N
Falls Church, VA 22043
Phone: (571) 969-6540
Fax: (571) 699-0518
Email: ashvinp228@gmail.com
Email: ap@aplawg.com
About Upper Cuts Gentleman's
Grooming Place LLC
Upper Cuts Gentleman's Grooming Place, LLC sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D.D.C. Case No. 18-00781)
on December 7, 2018. At the time of the filing, the Debtor
estimated assets of less than $50,000 and liabilities of less than
$500,000. The case is assigned to Judge S. Martin Teel, Jr. The
AP Law Group, PLC, is the Debtor's counsel.
VALADOR INC: Seeks Authority to Use Essex Bank Cash Collateral
--------------------------------------------------------------
Valador Inc. requests the U.S. Bankruptcy Court for the Eastern
District of Virginia to authorize its use of cash collateral during
the period from Dec. 13, 2018 to Feb. 28, 2019.
The Debtor requires the continued use of cash collateral in order
to meet its expenses and maintain the operation of its business,
including but not limited to the payment of employee payroll and
rent. The Debtor asserts that the continued operation of its
business is essential to its reorganization efforts.
The Debtor is indebted to Essex Bank under and in connection with a
$3,500,000 line of credit that Essex Bank previously provided to
the Debtor. The indebtedness that is owed by the Debtor to Essex
Bank under the Loan is secured by a first-priority security
interest against all of the Debtor's inventory, equipment,
accounts, accounts receivable, chattel paper, instruments, letter
of credit rights, letters of credit, documents, deposit accounts,
investment property, money, other rights of payment and
performance, general intangibles, payment intangibles, software,
and all records relating to any of the foregoing and all products
and proceeds of any of the foregoing.
The Debtor and Essex Bank have reached an agreement with respect to
the Debtor's use of Essex Bank's cash collateral in the ordinary
course of its business, for the purpose of paying the Debtor's
operating expenses as set forth in the budget. Essex Bank is
willing to consent to the use of its cash collateral by the Debtor
during the period from the petition date to Feb. 28, 2019 pursuant
to the terms and conditions of the Consent Order.
In consideration for permitting the Debtor to use cash collateral
during the Interim Period, the Debtor has agreed to make various
adequate protection payments to Essex Bank and to grant Essex Bank
replacement liens on and security interests in various
post-petition assets of the Debtor as set forth in the Consent
Order.
A full-text copy of the Debtor's Motion is available at
http://bankrupt.com/misc/vaeb18-14168-23.pdf
About Valador Inc.
Headquartered in Herndon, Virginia, Valador, Inc. is a business
that delivers solutions for collecting, maintaining, visualizing,
and protecting its clients' information. It focuses on four key
business areas: modeling and simulation, information assurance,
management consulting, and software engineering. It employs
innovative solutions such as the use of 3D immersive visualization
to address its clients' complex challenges including decision
support, strategic planning, risk management, safety and
reliability, assessment of alternatives, and information security.
Valador sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. E.D. Va. Case No. 18-14168) on Dec. 13, 2018. At the time
of the filing, the Debtor estimated assets of less than $50,000 and
liabilities of $1 million to $10 million. The case is assigned to
Judge Klinette H. Kindred. Richard Hall, Esq., is the Debtor's
legal counsel.
VARI-FORM INC: Gets CCAA Stay Order; PwC Named Monitor
------------------------------------------------------
Vari-Form Inc. has applied for and received an initial order for
protection pursuant to the Companies' Creditors Arrangement Act
from the Ontario Superior Court of Justice Commercial List, and
PricewaterhouseCoopers Inc., LIT, was appointed as monitor of the
Company. The initial order granted a stay of proceedings up to and
including Feb. 7, 2019.
In addition, the initial order, among other things, authorized (i)
the Company to continue to engage FTI Consulting, Inc., in its
capacity as financial advisor to the Company and AP Services LLC,
as provider of the services of Pilar Tarry, as chief restructuring
officer, Mr. Ted Stenger as chief financial officer and certain
other individuals as critical temporary staff; (ii) the company to
continue to utilize the central cash management system currently in
place or replace it with another substantially similar central cash
management system; (iii) the engagement of AP Services, Ms. Tarry,
Mr. Stenger, and the other AP Services' officers in accordance with
the terms of the engagement letter with AP Services;
The Court approved the engagement of Angle Advisors LLC as
financial advisor to the Company pursuant to the engagement letter
dated Nov. 12, 2018.
The Company is authorized to obtain borrowings under
debtor-in-possession borrowings from FCA USA, LLC, Fiat Chrysler
Automobiles N.V. and 11032569 Canada Inc. ("DIP Lender" and
"Staking Horse Bidder") in accordance with debtor-in-possession
facility loan agreement up to a maximum amount of $22.79 million.
The Court approved the bidding procedures and authorized the
Company to execute the stalking horse agreement. The Court
approved the payment and priority of the seller termination fee of
$1.5 million to the stalking horse bidder under stalking horse
agreement.
A notice will be sent to all known creditors of the Company who are
owed more than $1,000 in accordance with section 23 (1) (ii)(b) of
the CCAA and the Initial Order.
Court materials posted on the Monitor's website can be accessed at
http://www.pwc.com/ca/variforminc
Canadian Counsel to the Company:
Osler, Hoskin & Harcourt LLP
Box 50, 1 First Canadian Place 100 King Street West, Suite
6200
Toronto, ON M5X 1B8
Fax: (416) 862-6666
Tracy Sandler
Tel: (416) 862-5890
Email: tsandler@osler.com
John MacDonald
Tel: (416) 862-5672
Email: jmacdonald@osler.com
Robert Carson
Tel: (416) 862-4235
Email: rcarson@osler.com
Patrick Riesterer
Tel: (416) 862-5947
Email: priesterer@osler.com
Justine Erickson
Tel: (416) 862-4208
Email: jerickson@osler.com
U.S. Counsel to Vari-Form Holdings Group LLC:
Jones Day LLP
77 West Wacker
Chicago, IL 60601-1692
Fax: (312) 782-8585
Mark Cody
Tel: (312) 269-4392
Email: macody@jonesday.com
Thomas Wearsch
Tel: (216) 586-7015
Email: twearsch@jonesday.com
Proposed Monitor to the Company:
PricewaterhouseCoopers Inc
PWC Tower
18 York Street, Suite 2600
Toronto, ON M5J 0B2
Fax: (416) 365-8215
Gregory Prince
Tel: (416) 814-5752
Email: gregory.n.prince@pwc.com
Michael McTaggart
Tel: (416) 687-8924
Email: michael.mctaggart@pwc.com
Christine Sinclair
Tel: (416) 687-8938
Email: christine.l.sinclair@pwc.com
Tracey Weaver
Tel: (416) 814-5735
Email: tracey.weaver@pwc.com
Counsel to the Proposed Monitor:
McCarthy Tetrault LLP
Box 48, TD Bank Tower
66 Wellington Street West, Suite 5300
Toronto, ON M5K 1E6
Fax: (416) 868-0673
James Gage
Tel: (416) 601-7539
Email: jgage@mccarthy.ca
Heather Meredith
Tel: (416) 601-08342
Email: hmeredith@mccarthy.ca
Trevor Courtis
Tel: (416) 601-7643
Email: tcourtis@mccarthy.ca
Canadian Counsel to Fiat Chrysler Automobiles N.V., FCA USA, LLC,
and 11032569 Canada Inc.:
Borden Ladner Gervais LLP
Roger Jaipargas
Bay Adelaide Centre
East Tower 22 Adelaide Street West, Suite 3400
Toronto, ON M5H 4E3
Fax: (416) 367-6749
Tel: (416) 367-6266
Email: rjaipargas@blg.com
U.S. Counsel to Fiat Chrysler Automobiles N.V., FCA USA, LLC, and
11032569 Canada Inc.:
Sullivan & Cromwell LLP
125 Broad Street
New York, New York 10004-2498
Fax: (212) 558-3588
Brian Glueckstein
Tel: (212) 558-1635
Email: gluecksteinb@sullcrom.com
Alexa Kranzley
Tel: (212) 558-4000
Email: kranzleya@sullcrom.com
Mimi Wu
Tel: (212) 558-4000
Email: wum@sullcrom.com
Canadian Counsel to the term loan lenders under the term loan
agreement:
Blaker Cassels & Graydon LLP
Commerce Court West 199 Bay Street, Suite 4600
Toronto, ON M5L 1A9
Fax: (416) 863-2653
Milly Chow
Tel: (416) 863-2594
Email: milly.chow@blakes.com
Vanja Ginic
Tel: (416) 863-3278
Email: vanja.ginic@blakes.com
Chris Burr
Tel: (416) 863-3261
Email: chris.burr@blakes.com
U.S. Counsel to the Term Loan Lenders under the Term Loan
Agreement:
Proskauer Rose LLP
One International Place
Boston, MA 02110-2600
Peter Antoszyk
Tel: (617) 526-9749
Email: pantoszyk@proskauer.com
Brian Rosen
Tel: (617) 526-9890
Email: brosen@proskauer.com
Zachary Kurland
Tel: (617) 526-9454
Email: zkurland@proskauer.com
Canadian Counsel to Bank of America
Norton Rose Fulbright Canada LLP
Royal Bank Plaza, South Tower
200 Bay Street, Suite 3800
Toronto, ON M5J 2Z4
Fax: (416) 216-3930
Evan Cobb
Tel: (416) 216-1929
E-mail: evan.cobb@nortonrosefulbright.com
David Amato
Tel: (416) 216-1861
E-mail: david.amato@nortonrosefulbright.com
U.S. Counsel to Bank of America:
Winston & Strawn LLP
35 W. Wacker Drive
Chicago, IL 60601-9703
Fax: (312) 558-5700
Daniel McGuire
Tel: (312) 558-6154
E-mail: dmcguire@winston.com
AP Services can be reached at:
AP Services LLC
Pilar Tarry
300 N. LaSalle Street, Suite 1900
Chicago, IL 60654
Fax: (312) 346-2585
Tel: (312) 705-3944
E-mail: PTarry@alixpartners.com
Founded in 2007, Vari-Form Inc. --
https://www.pwc.com/ca/variforminc -- makes automotive stamping
products.
VIRTUS INVESTMENT: S&P Affirms 'BB' ICR, Outlook Stable
-------------------------------------------------------
S&P Global Ratings said it affirmed its 'BB' rating on Virtus
Investment Partners Inc. The outlook on the long-term issuer credit
rating remains stable. At the same time, S&P affirmed its 'BB'
rating on the company's term loan with a recovery rating of '3',
indicating meaningful, or 50%, recovery in the case of payment
default.
S&P said, "Our assessment of Virtus reflects the firm's small
market position and assets under management (AUM) concentration.
The company has limited product diversification, relies on a
relatively small amount of key employees, and likely has less
developed distribution capabilities versus most larger, more
well-established managers we rate. Acquisitions have fueled growth
over the past several years, and the company has had low success
with positive net inflows.
"The stable outlook reflects our expectation for EBITDA to increase
in 2019 as the company experiences the benefit of a full-year of
SGA's performance, incurs less transaction and integration fees,
and shows modest growth. It also reflects our expectation that the
company will maintain leverage close to 2x in 2019, although we
believe the company's ongoing leverage tolerance may be somewhat
higher due to its acquisitive strategy.
"We could lower the ratings if Virtus increases leverage to over 3x
on a sustained basis or if we observe material business
deterioration (investment performance or flows) such that we
believe Virtus' competitive position has substantially worsened.
"We could raise the ratings if Virtus reduces leverage to
comfortably below 2x and the company adopts a less acquisitive
strategy or a more stringent financial policy. An upgrade would
also be contingent upon the company demonstrating at least stable
flows and good investment performance."
VOIP-PAL.COM: Davidson & Company LLP Raises Going Concern Doubt
---------------------------------------------------------------
VoIP-Pal.Com Inc. filed with the U.S. Securities and Exchange
Commission its annual report on Form 10-K, disclosing Net Loss and
Comprehensive Loss of $8,401,548 on $0 of net revenue for the year
ended September 30, 2018, compared to a Net Loss and Comprehensive
Loss of $2,610,673 on $0 of net revenue for the year ended in
2017.
The audit report of Davidson & Company LLP states that the Company
has suffered recurring losses from operations and has a net capital
deficiency that raise substantial doubt about its ability to
continue as a going concern.
The Company's balance sheet at September 30, 2018, showed total
assets of $4,416,825, total liabilities of $112,935, and a total
stockholders' equity of $4,303,890.
A copy of the Form 10-K is available at:
https://bit.ly/2VTXqxN
VoIP-Pal.Com Inc. was incorporated in the state of Nevada in
September 1997 as All American Casting International, Inc. and
changed its name to VOIP MDU.com in 2004 and subsequently to
VoIP-Pal.Com Inc. in 2006. Since March 2004, the Company has been
in the development stage of becoming a Voice-over-Internet Protocol
(“VoIP”) re-seller, a provider of a proprietary transactional
billing platform tailored to the points and air mile business, and
a provider of anti-virus applications for smartphones.
WALL STREET THEATER: New Plan Discloses Inter-Creditor Settlements
------------------------------------------------------------------
Wall Street Theater Company, Inc., and affiliates filed its second
amended disclosure statement for their second joint chapter 11 plan
of reorganization dated Jan. 8, 2019.
This latest filing provides disclosures concerning certain
inter-creditor settlements.
Certain non-debtor parties, including parties over which the
Bankruptcy Court does not have jurisdiction, have agreed to resolve
claims between and/or among themselves that do not involve Debtors.
Some of these settlements are disclosed above and in the Master
Settlement Agreement. Other settlements have not been disclosed
because of confidentiality. All settlement specifically related to
any Wall Street Party has been disclosed, even if not subject to
Court approval.
In addition to the non-debtor settlements, Supertech has asserted
certain claims against Patriot Bank, N.A., Frank Farricker and
Suzanne Cahill. Supertech, Patriot, Farricker, and Cahill are
attempting to resolve these claims. No settlement has been
concluded and negotiations continue. Should the parties be unable
to resolve their disputes, they reserve all rights, including
Supertech's rights to vote against the Plan and object to
Confirmation. Debtors reserve their rights to prosecute their
objection to Supertech's Claim. Following is a summary of a
possible anticipated resolution of disputes:
(a) As to Patriot: To resolve claims concerning Patriot, on the
Effective Date, Patriot will receive relief from the Automatic Stay
and WSTC shall surrender to Patriot certain lighting equipment.
Patriot, subject to, and in accordance with a settlement agreement
with Supertech, will transfer the Lighting Equipment to
Supertech).
(b) As to Farricker and Cahill: To resolve claims against Farricker
and Cahill, Supertech, Farricker, and Cahill will make payments to
Supertech, subject to, and in accordance with a settlement
agreement among the parties, which is not subject to Court
approval.
Debtors have objected to Supertech's Proof of Claim. Supertech's
Claim will be treated under the Plan. Debtors seek to have
Supertech's mechanic's lien stripped off and extinguished as of the
Effective Date.
The Debtor also discloses information concerning Wall Street
Parties' capital and corporate structure on account of FHTCs.
To obtain access to the federal historic tax credits (FHTCs), a
special business structure was required to comply with the Internal
Revenue Code. This structure allowed Enhanced HTC, as the
"investment partner" to make a capital contribution in WSMT and
access the FHTCs to monetize for a third-party investor. Unlike
state tax credits, FHTCs cannot be bought and sold. The end user
must be an investor in a partnership that generates tax credits.
A copy of the Second Disclosure Statement is available at
https://tinyurl.com/yckbr5h5 from Pacermonitor.com at no charge.
About The Wall Street Theater
The Wall Street Theater, listed in the National Register of
Historic Places, has re-emerged as a 501c3 non-profit organization,
whose mission is to provide diverse programming and promote arts
education, thereby enriching the cultural life of the greater
Norwalk community. The Wall Street Theater --
https://www.wallstreettheater.com/ -- adopts its moniker from its
location and its mission from its history, combining live shows,
interactive entertainment, cinema, digital production, art space
and a community arena in which to play.
Wall Street Theater Company, Inc., and affiliates Wall Street
Master Landlord, LLC and Wall Street Managing Member, LLC, filed
Chapter 11 petitions (Bankr. D. Conn. Lead Case No. 18-50132) on
Feb. 4, 2018.
In the petitions signed by Suzanne Cahill, president, the WS
Theater Company and WS Master Landlord estimated $1 million to $10
million in assets and $10 million to $50 million in liabilities
while WS Managing Member estimated less than $50,000 in assets and
$10 million to $50 million in liabilities.
Judge Julie A. Manning is the case judge.
The Debtors tapped Green & Sklarz, LLC, as legal counsel; R.J.
Reuter, LLC as financial advisor; Wellspeak, Dugas & Kane, LLC as
real estate appraiser and consultant; and CohnReznick as auditor.
WASEEM INC: Seeks to Hire Wall Law Office as Legal Counsel
----------------------------------------------------------
Waseem, Inc., seeks approval from the U.S. Bankruptcy Court for the
Southern District of California to hire The Wall Law Office as its
legal counsel.
The firm will advise the Debtor on the requirements of the
Bankruptcy Code; prepare its plan of reorganization; assist the
Debtor in any potential sale and disposition of its assets; and
provide other legal services related to its Chapter 11 case.
William Wall, Esq., the attorney who will be handling the case,
will charge an hourly fee of $450. His firm received $10,000 prior
to the Debtor's bankruptcy filing.
Mr. Wall disclosed in a court filing that he is "disinterested" as
defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
William J. Wall, Esq.
The Wall Law Office
A Professional Corporation
100 Pacifica, Suite 370
Irvine, CA 92618
Tel: 949-387-4300
Fax: 949-860-7890
E-mail: wwall@wall-law.com
About Waseem Inc.
Waseem, Inc., which conducts business under the name Sabre Spring
Hand Car Wash and Detaling, operates a car wash facility in the
Sabre Springs area of San Diego.
Waseem filed a Chapter 11 petition (Bankr. S.D. Cal. Case No.
18-07232) on Dec. 5, 2018. In the petition signed by Waad Sako,
president, the Debtor estimated $0 to $50,000 in assets and $1
million to $10 million in liabilities. The case is assigned to
Judge Margaret M. Mann. The Debtor tapped William J. Wall, Esq.,
at The Wall Law Office, as its legal counsel.
WORLD LIQUIDATORS: Seeks to Hire Mancuso Law as Legal Counsel
-------------------------------------------------------------
World Liquidators, Inc., seeks approval from the U.S. Bankruptcy
Court for the Southern District of Florida to hire Mancuso Law,
P.A., as its legal counsel.
The firm will advise the Debtor regarding its duties under the
Bankruptcy Code; represent the Debtor in negotiation with its
creditors in the preparation of a bankruptcy plan; and provide
other legal services related to its Chapter 11 case.
Nathan Mancuso, Esq., at Mancuso Law, disclosed in a court filing
that his firm neither holds nor represents any interest adverse to
the Debtor's bankruptcy estate.
The firm can be reached through:
Nathan G. Mancuso, Esq.
Mancuso Law, P.A.
Boca Raton Corporate Centre
7777 Glades Rd., Suite 100
Boca Raton, FL 33434
Tel: 561-245-4705
Fax: 561-226-2575
E-mail: ngm@mancuso-law.com
About World Liquidators
World Liquidators, Inc. sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 19-10100) on Jan. 4,
2019. At the time of the filing, the Debtor estimated assets of
less than $50,000 and liabilities of less than $1 million. The
case is assigned to Judge John K. Olson. Mancuso Law, P.A., is the
Debtor's counsel.
*********
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