/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/190515.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, May 15, 2019, Vol. 23, No. 134 Headlines 160 ROYAL PALM: Ct. OK's Bid to Prohibit KK-PB from Credit Bidding 4921 12TH AVENUE: Galster Funding Files Chapter 11 Plan 73-75 WILLOW: U.S. Trustee Objects to Disclosure Statement 8133 LEESBURG: Thallium Buying Vienna Property for $30 Million ADVANTAGE SALES: S&P Downgrades ICR to 'B-'; Outlook Negative ALIXPARTNERS LLP: S&P Affirms 'B+' ICR; Outlook Stable AMERIQUEST SECURITY: Zurich American Objects to Plan Disclosures ASTRIA HEALTH: $28-Mil. Interim Access to Bankruptcy Financing ATLANTIC INTERNATIONAL: Chapter 15 Case Summary BARCORD INC: To Hold Public Auction on May 21 BEAUTIFUL BROWS: Hires Southeastern Business as Business Broker BENCHMARK ELECTRONICS: S&P Lowers ICR to 'BB-'; Outlook Stable BENTWOOD FARMS: Rabo AgriFinance Objects to Disclosure Statement BIG BEAR BOWLING: Has $1M Offer for Big Bear Lake Property BRILLIANT ENVIRONMENTAL: Case Summary & 20 Top Unsecured Creditors BRISTOW GROUP: Moody's Cuts PDR to D-PD on Bankruptcy Filing BRITISH BAZAAR: To Restructure Under CCAA; Deloitte as Monitor BROOKFIT VENTURES: Grandave Buying Business for $750K BROOKLYN BUILDINGS: Unsecureds to Get 100% from Sale Proceeds BUCKEYE PARTNERS: Fitch Puts BB Subordinated Debt on Watch Neg. CAFFE VALDINO: Seeks to Hire Tarter Krinsky as Counsel CALIFORNIA PALMS: Selling Four-Story Austintown Hotel for $3.7M CAROL ROSE: $380K Sale of Gainesville Property to DOT Approved CATHAY GENERAL: Fitch Affirms 'BB+/B' LongTerm IDRs CELADON GROUP: Delays Filing of March 31 Quarterly Report CELADON GROUP: Donargo Succeeds Albrecht as CFO CENTERSTONE LINEN: Bid Deadline for All Assets Moved to May 22 CENTURY ALUMINUM: S&P Affirms 'B' ICR; Outlook Negative CHATTANOOGA MOTORS: Case Summary & 6 Unsecured Creditors CLAREMONT HOLDING: Case Summary & 13 Unsecured Creditors CLOUD PEAK: Incurs $49.7 Million Net Loss in First Quarter CLOUD PEAK: Moody's Cuts CFR to 'C' on Bankruptcy Filing CMC HEARTLAND: $40K Sale of Real Property Interests to Haweye OK'd CORINTHIAN COLLEGES: Carr, Colon Suit vs E. Devos, et al., Tossed COUNTRYSIDE PROPERTY: Hires Shraiberg Landau as Counsel CRESCENT ASSOCIATES: Shilkraut Buying L.A. Property for $1.8M CYTODYN INC: Signs Warrants Exercise Agreements CYTOSORBENTS CORP: Incurs $4.88 Million Net Loss in First Quarter CYTOSORBENTS CORP: Reports First Quarter 2019 Financial Results DAK CONSTRUCTION: Unsecureds to Get 5% in 20 Quarters DAVIS PROPERTIES: $2.3M Sale of Canby Property to Civignite Okayed DEBORAH SANZARO: Wins Disability Discrimination Suit vs HOA, et al. ENERGY GUARD: Proposes a June 17 Auction of All Membership Units EP ENERGY: Incurs $140 Million Net Loss in First Quarter EPICENTER PARTNERS: Ct. Junks LKY Bid for Withdrawal of Reference EYEPOINT PHARMACEUTICALS: Reports Q1 Net Loss of $19.2 Million FOUR THE BOYS: Case Summary & 3 Unsecured Creditors GARLAND BARBECUE: Unsecureds to Get 50% Under Chapter 11 Plan GRANT STREET: Trustee Selling Framingham Property for $2.6M GREGORY TE VELDE: Trustee Selling Cessna P210N Airplane for $75K GRIFFITH FARMS: Hires Russell Guthrie as Accountant HAWAIIAN EBBTIDE: Hires Star Consulting as Counsel HERITAGE CONSOLIDATED: Texas Court Upholds Ruling Against ACME, EER HEXION HOLDINGS: Seeks to Hire Paul Weiss as Counsel HOSPITAL ACQUISITION: May 17 Meeting Set to Form Creditors' Panel ICONIX BRAND: Stockholders Elect Five Directors IHEARTMEDIA INC: May 31 Administrative Claims Bar Date INPRINT MANAGEMENT: June 11 Plan Confirmation Hearing JAMES CANDY: Union Online Auction of Surplus Equipment Approved JAMES JELINEK: Son Buying Box Butte County Property for $524K JEFFERIES FINANCE: Fitch Places 'BB' LT IDR on Watch Positive JOSEPH G. FOUST: $14K Sale of Fixtures & Equipment to Meadows OK'd JRV GROUP: Case Summary & 20 Largest Unsecured Creditors K. INVESTMENT: Seeks to Hire Fisher-Sandler as Legal Counsel LEGACY JH762: Voluntary Chapter 11 Case Summary LIVING BENEFITS ASSET: 5th Cir. Affirms Ruling in Favor of Kestrel LOUISIANA HEART: MIC, et al., Lose Summary Ruling Bid vs S. Finger MARIO LOZANO: Status Conference on Dorchester Property Sale Held MEMENTO MORI: American Lending Objects to Disclosure Statement MEMENTO MORI: Mercantile Capital Objects to Disclosure Statement MESKO RESTAURANT: Case Summary & 20 Largest Unsecured Creditors MGT MANUFACTURING: Unsecureds to Get 100% from Property Sale MIDTOWN INVESTMENT: July 24 Deadline to File Plan, Disclosures MITE LLC: July 2 Hearing on Disclosure Statement MONITRONICS INTERNATIONAL: Gets Forbearance Extension Until May 15 N & B MANAGEMENT: June 4 Hearing on Disclosure Statement NANCY B. SCHOTT: Clark Buying Woodbury Property for $237K NEAL STUBBS: Tucci Buying Costa Rica Property for $435K NEIMAN MARCUS: Extends Early Tender Deadline to May 15 NICHOLAS KAYE: Selling Personal Property for $15K PENGROWTH ENERGY: Incurs C$31.6 Million Net Loss in First Quarter PEPPERTREE PARK: Aug. 12-16 Plan Confirmation Hearing PLAIN LEASING: Unsecureds Paid Monthly for 60 Months PUMAS CAB: June 12 Hearing on Disclosure Statement QUANTUM TRANSPORTATION: Case Summary & 20 Top Unsecured Creditors QUIZHPI CAB: June 12 Hearing on Disclosure Statement REGDALIN PROPERTIES: Trustee Selling Carson Property for $950K RS OLD: Suffern Buying All Assets Nunc Pro Tunc to Sept. 1, 2017 SELECTA BIOSCIENCES: Incurs $12.1-Mil. Net Loss in First Quarter SHEFA LLC: Court Upholds Ruling Against Southfield City SPRINGFIELD LAND: Unsecureds to Get Payment from Property Sale STEVE SHICKLES, JR: Sets Sales Procedures for 2017 Tiffin Motorhome STEVE SHICKLES, JR: Sets Sales Procedures for 2018 BMW M4 STONEMOR PARTNERS: Reports Q1 Net Loss of $22.5 Million SUNGARD AVAILABILITY: Prepackaged Plan Declared Effective SUPERCLEAN ENTERPRISES: Swonger Buying Customer List for $5K T & S SUBS: June 20 Plan Confirmation Hearing TITANIUM HOLDING: Griffin Buying Ocean City Property for $265K TODD'S CAR WASH: Unsecured Creditors to Get $2K Per Month URUS GROUP: Secured Judgment Creditors Object to Plan Disclosures WEATHERFORD INT'L: Moody's Cuts CFR to Ca Amid RSA with Noteholders WESTERN RESERVE: Watersurplus Buying Personal Property for $260K WILL NELSON: $230K Sale of Nesbit Property to Honnoll Approved WILLIAM SABOL: Agritainment Buying Saint Paul Property for $1.6M WINDSTREAM HOLDINGS: Committee Taps Morrison & Foerster as Counsel WINDSTREAM HOLDINGS: Committee Taps Perella as Investment Banker WINDSTREAM HOLDINGS: Taps Alvarez & Marsal as Financial Advisor WINDSTREAM HOLDINGS: Taps KCC as Administrative Advisor WINDSTREAM HOLDINGS: Taps Kirkland & Ellis as Legal Counsel WINDSTREAM HOLDINGS: Taps PJT Partners as Investment Banker WINDSTREAM HOLDINGS: Taps PricewaterhouseCoopers as Auditor ZACKY & SONS: Sets Bidding Procedures for 15 Real Properties ********* 160 ROYAL PALM: Ct. OK's Bid to Prohibit KK-PB from Credit Bidding ------------------------------------------------------------------ Bankruptcy Judge Erik P. Kimball granted Debtor 160 Royal Palm, LLC's motion to limit credit bidding, and entered an order prohibiting KK-PB Financial LLC from credit bidding its claim represented by proof of claim number 70-3 in any sale of the Debtor's hotel property and related assets. With regard to KK-PB's motion to estimate its claim, the Court entered an order estimating the claim as an unsecured claim and estimating its amount as $0, for all purposes in this case. The Court denied KK-PB's motion for relief from stay or to dismiss this Debtor’s chapter 11 case. KK-PB's goal in its motion for relief from stay or for dismissal of the case is to return to state court to complete its foreclosure action. At the evidentiary hearing, KK-PB presented nearly no evidence to support the substantive allegations in this motion nor did counsel point to any such evidence in closing argument. But even if KK-PB's secured claim is allowed in full, there is not cause for relief from stay at this time. The Debtor filed this case in an attempt to realize value for all of its creditors, not just for KK-PB. The Debtor has diligently pursued that sale, entering into a contract with a stalking horse purchaser. This is an appropriate use of chapter 11. The Court has approved a procedure for the proposed sale consistent with regular practice in this circuit. There is a very short timeline for that sale. The Debtor and other creditors should have the chance to see if the proposed auction will result in a potential distribution to creditors in this case. There is little or no harm to KK-PB under the circumstances, even if it does indeed have an allowed secured claim in this case. The potential harm to other creditors is significant. KK-PB's motion for relief from stay or for dismissal is denied. The Debtor also asked the Court to deny KK-PB the right to credit bid under the for cause standard in section 363(k). The were two arguments in this regard. First, it was alleged that Mr. Straub committed bad acts and that this constitutes cause. Based on the evidence admitted in these matters, the Court is unable to make such a finding in this case. Second, it was argued that allowing KK-PB to credit bid would chill bidding to the detriment of other creditors. The Court is aware that there is some case law suggesting that this would be sufficient to constitute cause under section 363(k). The Court does not agree with that case law. The Supreme Court has repeatedly ruled that state law lien rights are sacrosanct in bankruptcy matters except where Congress has explicitly provided otherwise. The ability of a secured creditor to protect its lien rights by bidding its own claim in a sale of its collateral is a central component of the rights of a lien holder. The credit bid right should be abrogated only under very unusual circumstances. To suggest that a sale process will be easier, more efficient, or more fruitful without one party bidding is simply not enough. The Court grants the Debtor's motion to prohibit KK-PB from credit bidding for other reasons. The bankruptcy case is in re: 160 ROYAL PALM, LLC, Chapter 11, Debtor, Case No. 18-19441-EPK (Bankr.S.D. Fla.) A copy of the Court's Order dated Feb. 25, 2019 is available at https://bit.ly/2LDFPsH from Leagle.com. 160 Royal Palm, LLC, Debtor, represented by Philip J. Landau, Bernice C. Lee & Eric S. Pendergraft -- ependergraft@slp.law -- Shraiberg, Landau & Page, P.A. Office of the US Trustee, U.S. Trustee, represented by Heidi A. Feinman, Office of the US Trustee. About 160 Royal Palm 160 Royal Palm, LLC is a Florida limited liability company, which owns prime real property consisting of a partially constructed hotel/condominium located at 160 Royal Palm Way, Palm Beach, Florida. The property is under state court receivership. 160 Royal Palm filed a voluntary petition for relief under chapter 11 of the United States Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-19441) on Aug. 2, 2018. In the petition signed by Cary Glickstein, sole and exclusive manager, the Debtor disclosed $16,447,759 in total assets and $114,926,976 in total liabilities. The case has been assigned to Judge Erik P. Kimball. The Debtor tapped Philip J. Landau, Esq., at Shraiberg, Landau & Page, P.A., as its counsel; and Greenberg Traurig, P.A. as its special counsel and title agent. No official committee of unsecured creditors has been appointed in the Debtor's case. 4921 12TH AVENUE: Galster Funding Files Chapter 11 Plan ------------------------------------------------------- Galster Funding LLC files a Chapter 11 Plan of Reorganization and accompanying Disclosure Statement for 4921 12th Avenue LLC. Class 5 - General Unsecured Claims are impaired. Claims total approximately $12,480,175. Payment of available Cash up to Allowed Amount of Class 5 Claims, after payment of Administrative Expenses, priority tax Claims, Class 1, 2, 3, and 4 Claims. Class 2 - Galster Funding LLC are impaired. Claims totals approximately $9,480,175 as of the filing date. Payment of available Cash up to Allowed Amount of Class 2 Claim, after payment of Administrative Expenses, priority tax Claims, Class 1 Claims and Class 4 Claims. If the Property Sale Proceeds are insufficient to pay the Claim in full, the deficiency amount shall be treated as a Class 5 Claim. Class 3 - Old Republic are impaired. Claim totals approximately $13,500,000 as of the filing date. Payment of available Cash up to Allowed Amount of the Class 3 Claim, after payment of Administrative Expenses, priority tax Claims, Class 1 Claims, Class 2 Claims and Class 4 Claims. If the Property Sale Proceeds are insufficient to pay the Claim in full, the deficiency amount shall be treated as a Class 5 Claim. Class 6 - Interests are impaired. Payment of available Cash after payment of Administrative Expenses, priority tax Claims, Class 1, 2, 3, 4 and 5 Claims. Payments under the Plan will be paid either from the Property Sale Proceeds or Cash to be contributed by Galster if Galster or its designee is Purchaser of the Property by credit bid. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/y4nnf826 from PacerMonitor.com at no charge. Attorneys for the Proponent: Mark A. Frankel, Esq. BACKENROTH FRANKEL & KRINSKY, LLP 800 Third Avenue New York, NY 10022 Telephone: (212) 593-1100 Facsimile: (212) 644-0544 About 4921 12th Avenue 4921 12th Avenue LLC is a real estate lessor headquartered in Brooklyn, New York. The company is a single asset real estate, as defined in 11 U.S.C. Section 101(51B). 4921 12th Avenue filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 18-47256) on Dec. 20, 2018. In the petition signed by Yehuda Salamon, sole member, the Debtor estimated $1 million to $10 million in assets and $10 million to $50 million in liabilities. The case is assigned to Judge Carla E. Craig. Balisok & Kaufman, PLLC, is the Debtor's counsel. 73-75 WILLOW: U.S. Trustee Objects to Disclosure Statement ---------------------------------------------------------- William K. Harrington, the United States Trustee for Region 2, objects to the disclosure statement explaining the Chapter 11 Plan filed by 73-75 Willow Street, LLC. The U.S. Trustee complains that in its Disclosure Statement, the Debtor's liquidation analysis fails to clearly identify and list all of the Debtor's assets and their values. The U.S. Trustee points out that on page 3 of the Disclosure Statement, the Debtor states that it has approximately six unsecured creditors owed approximately $16,000, not including the amounts due to undersecured creditors. The U.S. Trustee further points out this figure is not accurate based upon the information listed in Schedule F and the claims register. The U.S. Trustee asserts that for Class 1 (Bridgeport WPCA), the Disclosure Statement fails to state the amount currently due to Bridgeport WPCA and the figure used on Exhibit B does not match that of the proof of claim number 1 filed by Bridgeport WPCA. According to the U.S. Trustee, the Disclosure Statement states that EBay shall release its mortgage and its debt will be treated as an unsecured debt. The U.S. Trustee points out there is no information provided in the Disclosure Statement to explain the nature of the disputed claim and the basis for the proposed treatment, including the release that EBay is to provide. The U.S. Trustee complains that the Plan appears to violate the absolute priority rule by providing that the equity holder, Charles Coviello, is going to keep his interest in the Debtor (Class 6) while failing to pay unsecured creditors in full and only paying them 5% (Class 5). According to U.S. Trustee, the Disclosure Statement should be revised at page 9 to specifically disclose the agreed terms by which the Debtor will pay the administrative claim of its counsel. The U.S. Trustee points out that the Plan at Article Eight, paragraph 2 incorrectly says the Debtor will receive a discharge under Section 1141(d)(5). The U.S. Trustee further points out this section is applicable only to individuals and is not applicable to the Debtor as the Debtor is a limited liability company. As such, paragraph 2 should be deleted. According to the U.S. Trustee, the Plan fails to describe who will manage the Debtor post-confirmation and what the compensation will be for Mr. Coviello if he continues in his current management role, such information is required by Section 1129(a)(5). 73-75 Willow Street, LLC filed for Chapter 11 bankruptcy (Bankr. D. Conn. Case No. 18-50825) on June 28, 2018, listing under $1 million in both assets and liabilities. Judge Julia A. Manning oversees the case. 8133 LEESBURG: Thallium Buying Vienna Property for $30 Million -------------------------------------------------------------- 8133 Leesburg Pike, LLC, asks the U.S. Bankruptcy Court for the Eastern District of Virginia to authorize the private sale of the real property located at 8133 Leesburg Pike, Vienna, Virginia, together with the improvements thereon, to Thallium, LLC, or its assigns for $30.25 million, cash. The Debtor is indebted to United Bank as successor to Cardinal Bank, under a $20 million commercial real estate loan, made on July 31, 2013. The Senior Loan is secured by, among other things, a first priority Deed of Trust encumbering the 8133 Property, dated July 31, 2013. United Bank has asserted that, as of the Petition Date, the Debtor was indebted to it under the Senior Loan in the principal amount of $19,447,958, together with interest and other charges, for a total of $21,237,387. The Debtor is also indebted to United Bank as successor to Cardinal Bank, under a Guaranty and Indemnification Agreement, dated March 11, 2014, by which the Debtor guaranteed a loan from United Bank to the Debtor's parent entity, International Place at Tysons, LLC, in the principal amount of $12.75 million. The Junior Loan is secured by, among other things, a second priority Indemnity Deed of Trust encumbering the 8133 Property, dated March 11, 2014. United Bank has asserted that, as of the Petition Date, the Debtor was indebted to it under the Junior Loan in the principal amount of $12,454,253, together with interest and other charges, for a total of $13,862,985. In light of the foregoing, United Bank has asserted that as of the Petition Date the Debtor was indebted to it under the United Bank Loans in the aggregate amount of $35,100,373. 8133 is also indebted to KKM under a Guaranty and Indemnification Agreement, dated on March 6, 2014, by which the Debtor guaranteed payment of a promissory note from IPT to KKM in the original principal amount of $12 million. Under the terms of the Guaranty to KKM, the Debtor’s total monetary liability to KKM is limited to $4 million, plus KKM's costs to enforce the Guaranty to KKM. The Guaranty to KKM is secured by, among other things, a third priority Deed of Trust encumbering the 8133 Property, dated March 11, 2014. On Nov. 27, 2017, CBRE, Inc., filed two Memoranda of Commercial Real Estate Broker’s Lien against the 8133 Property for leasing commissions totaling $100,522. Prior to the Petition Date, the United Bank Loans and the Guaranty to KKM matured and became due and payable. The Debtor subsequently entered into a series of modification or forbearance agreements with United Bank and KKM. Nonetheless, after the Secured Lenders declared events of default under their loans, and it became apparent that the Secured Lenders would not agree to further extensions or forbearance periods, the Debtor decided to ask relief under chapter 11 of the Bankruptcy Code in order to preserve and enhance the value of its business and assets for all of its creditors, tenants, vendors, and other stakeholders. Marcus & Millichap Real Estate Investment Services, Inc. ("M&M") as the Debtor's broker marketed the 8133 Property. As an expression of interest in acquiring it, Thallium has posted an earnest money deposit of $1.5 million with its legal counsel. After Thallium conducted preliminary due diligence and the parties engaged in additional negotiations, Thallium and 8133 entered into the Agreement for Thallium’s purchase of the 8133 Property for the gross price of $30.25 million. It is important to note that the Secured Lenders support the Motion and the relief sought therein. The Agreement contemplates the private sale of the 8133 Property to Thallium pursuant to the following material terms: a. The 8133 Property is comprised of the Debtor’s real property located at 8133 Leesburg Pike, Vienna, Virginia 22182 as improved by theOffice Building; all rights of the Debtor under the executory contracts and unexpired leases and licenses of the Debtor that are set forth on Exhibit C; and all security deposits relating to the Assigned Contracts. b. $30.25 million, cash at Closing including application of the Earnest Money Deposit. There is no financing condition to Thallium's obligation to Close. c. Earnest Money Deposit: $1.5 million, which, subject to certain exceptions, will be non-refundable following expiration of the Due Diligence Period. d. Closing Date: Within 45 days following conclusion of the Due Diligence Period. e. Assumed Liabilities: All Claims, liabilities and obligations arising after the Closing Date relating to the 8133 Property; all liabilities and obligations of the Debtor related to or arising under the Assigned Contracts from and after the Closing; all Closing costs and transaction taxes for which Thallium is responsible pursuant to the Agreement. f. The Debtor will have responsibility for paying any Cure Costs due in connection with the assumption and assignment of the Assigned Contracts. g. The Motion asks authority to apply, at Closing, the net proceeds of sale to lienholders, including the Secured Lenders, in the order of priority of the liens encumbering the 8133 Property. h. Should 8133 sell the 8133 Property to a party other than Thallium, 8133 will be liable to Thallium for up to $50,000 of Thallium’s documented, third-party expenses incurred in pursuing its proposed purchase. A full-text copy of the Agreement attached to the Motion is available for free at: http://bankrupt.com/misc/8133_Leesburg_153_Sales.pdf In the aggregate, the 8133/IPT Debtors owe the Secured Lenders in excess of $50.5 million. The gross purchase price under the Agreement is $30.25 million and the gross purchase price under the IPT Contract is $18 million, for an aggregate total of $48.25 million. It thus appears that neither of the 8133/IPT Debtors is solvent given current market conditions and values. To facilitate disposition of the 8133/IPT Properties under the Agreement and the IPT Contract, United Bank has agreed to release and forgo the Default Charges portion of its secured claims subject to certain material conditions. In particular, United Bank has agreed to accept, in full, final, and complete satisfaction of all indebtedness owed to United Bank on account of the United Bank Loans (including the release of Andrew S. Garrett, a principal of the 8133/IPT Debtors, from his personal guaranty of the United Bank Loans), a payment from the proceeds arising from the sale of the 8133/IPT Properties pursuant to the Agreement and the IPT Contract in an amount equal to and consisting of (a) all unpaid principal amounts due and owing to United Bank on account of the United Bank Loans, plus (b) all accrued and unpaid interest due and owing to United Bank on account of the United Bank Loans at the non-default rates of interest provided for in United Bank's loan documents with the 8133/IPT Debtors, plus (c) all unpaid extension fees due and owing to United Bank on account of the United Bank Loans, plus (d) all unpaid attorney's fees and expenses due and owing to United Bank on account of the United Bank Loans, provided that United Bank receives such payment by 3:00 p.m. on June 28, 2019. As of June 28, 2019, the collective payment to be made to United Bank from the proceeds arising from the sale of the 8133/IPT Properties pursuant to the Agreement and the IPT Contract will amount to $33,270,676, plus any interest that accrues on the United Bank Loans between April 30, 2019 and June 28, 2019 at the non-default rates of interest provided for in the United Bank Loan zocuments, plus any attorney’s fees and expenses incurred by United Bank in connection with the United Bank Loans between March 1, 2019 and June 28, 2019, less any monthly interest payments received by United Bank on account of the United Bank Loans between April 15, 2019 and June 15, 2019. Likewise, in order to facilitate sales of the 8133/IPT Properties, KKM has agreed to accept in full, final, and complete satisfaction of all indebtedness owed to KKM on account of the IPT/KKM Note and the Guaranty to KKM (including the release of Andrew S. Garrett, from liability under his personal guaranty of the IPT/KKM Note and the Guaranty to KKM), a payment from the proceeds arising from the sale of the 8133/IPT Properties pursuant to the Agreement and the IPT Contract in the amount of $12.8 million. In addition to the foregoing agreements, the 8133/IPT Debtors, KKM, and United Bank have agreed, that if either or both of the 8133/IPT Debtors enters into a contract other than the Agreement or the IPT Contract which results in aggregate gross sale proceeds from the sale of 8133/IPT Properties in excess of $48.25 million, then the amount of the Excess Proceeds will be distributed as follows: (a) of the first $1.5 million of any Excess Proceeds, KKM will receive 50%, United Bank will receive 25%, and 8133/IPT Debtors will retain the remaining 25%; and (b) of all Excess Proceeds above $1.5 million, KKM, United Bank, and the 8133/IPT Debtors will each receive or retain one-third of such Excess Proceeds. In consideration of the agreement of United Bank and KKM to reduce their claim amounts against the 8133/IPT Debtors as provided for above, the 8133/IPT Debtors (and Andrew S. Garrett individually) have agreed to release and waive any actual or potential claims, counterclaims, or offsets they have or may have against United Bank and/or KKM and their respective affiliates, officers, directors, agents, employees, and attorneys including, but not limited to Clifton "Kip" Killmon, a principal of KKM. The Agreement provides a greater recovery for the Debtor's estate than can realistically be achieved by any other practically available alternative. Thallium has not committed to participating in an auction or other sale process, and thus the Debtor's estate would potentially be sacrificing a prospective sale on what are, under the circumstances, favorable terms, from the standpoint of the Secured Lenders and other parties in interest, in order to gamble that more favorable terms might materialize in the future. Importantly, the Debtor, in consultation with M&M, submits that Thallium (with the financial backing of Dave Schaeffer) has demonstrated an ability to consummate the sale under the Agreement. Such cannot be said at this time about an unknown future bidder. The Debtor believes that all entities asserting a lien or security interest in the 8133 Property will either be paid in full from the net proceeds of sale at Closing, or have (or will) consent to the sale under the Agreement. Accordingly, the 8133 Property may be sold free and clear of liens and security interests, with the liens of the Secured Lenders and any other creditor that holds a validly perfected lien against the 8133 Property being paid at Closing or attaching to the proceeds of sale as provided for. The Debtor is also asking authority at Closing to assume and assign to Thallium the Assigned Contracts identified on Exhibit C, and that any objections by counter parties to Assigned Contracts to assumption and assignment be determined at the hearing to consider the Motion. About 8133 Leesburg Pike 8133 Leesburg Pike, LLC, is the owner of the real property located at 8133 Leesburg Pike, Vienna, Virginia, improved by a multi-floor, 148,482 square foot, office building built in 1981 and acquired by the company in December 2002. It is the Debtor's goal and expectation in filing its Chapter 11 case to sell the Property at a price sufficient to pay in full all of the Debtor's secured and unsecured debt. 8133 Leesburg Pike filed a Chapter 11 bankruptcy petition (Bankr. E.D. Va. Case No. 18-10432) on Feb. 6, 2018. The Debtor hired Hirschler Fleisher as counsel. Marcus & Millichap Real Estate Investment Services, Inc., is the real estate broker. ADVANTAGE SALES: S&P Downgrades ICR to 'B-'; Outlook Negative ------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S.-based Advantage Sales & Marketing Inc. to 'B-' from 'B'. The rating agency expressed belief it could be difficult for the company to refinance its very large $2.5 billion outstanding first-lien term loan due July 23, 2021, given the tough conditions in its industry, which could become even more challenging if the U.S. economy goes into recession. S&P also said the company's operating performance has significantly underperformed the rating agency's original expectations as its adjusted debt to EBITDA increased to the high-7x area from 6.5x as of Dec. 31, 2017. Meanwhile, S&P lowered its issue-level rating on the company's senior secured first-lien debt to 'B-' from 'B' and its issue-level rating on the company's second-lien debt to 'CCC' from 'CCC+'. Its '3' recovery rating on the first-lien debt and '6' recovery rating on the second-lien debt remain unchanged." "Given the $2.5 billion debt maturity and the company's variable performance, we believe its medium-term default risk has increased. Even if Advantage does successfully refinance the term loan, the company's interest costs will likely rise, which will reduce its free cash flow," S&P said. S&P said it could lower the ratings if the company hasn't refinanced the term loan on reasonable terms by the end of the first half of 2020, or if it views the capital structure as unsustainable, adding that this could happen if industry conditions worsen and the company's operating performance deteriorates such that free cash flow drops meaningfully, leverage approaches 9.5x or EBITDA interest coverage approaches 1.5x. "The negative outlook reflects the potential for a lower rating if the company hasn't refinanced its term loan on reasonable terms by the end of the first half of 2020 or we come to view its capital structure as unsustainable," S&P said. This could happen if industry conditions worsen, including weak brick–and-mortar retail traffic that causes manufacturers to further cut their spending on outsourced sales and marketing functions, and the company's operating performance deteriorates further such that its free cash flow declines significantly, its leverage approaches 9.5x, or its EBITDA interest coverage approaches 1.5x, according to the rating agency. S&P said it could take a positive rating action over the next 12 months if Advantage successfully refinances its credit facility on reasonable terms while improving its profitability through the realization of cost synergies and new account wins. ALIXPARTNERS LLP: S&P Affirms 'B+' ICR; Outlook Stable ------------------------------------------------------ S&P Global Ratings affirmed its 'B+' issuer credit rating on U.S.-based business and financial advisory services provider AlixPartners LLP. The outlook remains stable. At the same time, S&P assigned its 'B+' issue-level rating and '3' recovery rating to the company's proposed $390 million incremental senior secured term loan. The affirmation reflects S&P's expectation for business trends to remain solid, enabling the good revenue and EBITDA growth to reduce debt leverage. Although it expects pro forma leverage to increase to 6.1x from 5.0x as of March 31, 2019, S&P forecasts that leverage will decline to about 5.8x by year-end 2019 and improve further to the low-5x area in 2020, primarily due to EBITDA growth from strong demand for the company's services. "Despite our expectations for strong operating performance and improved credit metrics, leverage will likely remain elevated in the mid- to high-5x area over the next two to three years because of the company's high debt tolerance and preference for debt-financed special dividends," S&P said. "AlixPartners has a well-respected brand with good capabilities providing digital, enterprise improvement, financial advisory and restructuring advisory services. Still, competition is intense for consulting services, and the frequency and scope of projects limits revenue visibility," S&P said. "AlixPartners' turnaround and restructuring practice is counter-cyclical and protects against downside risk, which in our opinion reduces revenue and cash flow volatility and supports the company's creditworthiness compared to its rated peers." The stable outlook reflects S&P's expectation that AlixPartners will continue to experience mid- to high-single-digit percentage revenue and EBITDA growth driven by strong demand for the company's services, which will keep leverage comfortably under 6x over the next 12 months. "We could lower the issuer credit rating if the demand for services declines, resulting in leverage remaining above 6x and discretionary cash flow (DCF) to debt below 2%. This could occur if revenue declines by 10%, the company pursues additional debt-financed dividends, or EBITDA margin declines by 100 basis points," S&P said. "We are unlikely to raise the rating over the next 12 months, primarily due to the company's aggressive financial policy and history of debt-funded dividends. An upgrade would require stronger-than-expected operating performance combined with a more conservative financial policy and reduction in leverage to the mid-4x area on a consistent basis," the rating agency said. AMERIQUEST SECURITY: Zurich American Objects to Plan Disclosures ---------------------------------------------------------------- Zurich American Insurance Company of Illinois files an objection to the disclosure statement explaining Ameriquest Security Service's Chapter 11 Plan. Zurich complains that the Projected Income/Expenses only provide projections for one year, not five, while normally projections for five years can be extrapolated from a one year income/expense analysis, that is not the case here. According to Zurich, the Disclosure Statement either (1) implies, without explanation, that the Debtor will continue to pay $2,500/month to counsel for the remaining four years of the Plan, or (2) provides no explanation what will happen with the $120,000 that the Debtor will retain after paying off counsel's claim. Zurich points out there is, however, no explanation why the Debtor's Projected Income/Expenses anticipate paying three times as much in the U.S. Trustee's fees than is necessary. Zurich asserts that the Projected Income/Expenses contains a number of purported business expenses however, the Debtor provides no explanation or rational for these expenses. According to Zurich, the Disclosure Statement clearly fails to adequately inform creditors what the Debtors’ projected expenses will be over the course of a five year period. Zurich points out that the Plan, as proposed, contains numerous inconsistencies and proposes numerous payments that the Debtor is not obligated to make. Zurich further points out, instead of maximizing the recovery for creditors, the Plan maximizes recovery for the Debtor's equity holders. Such an outcome is entirely antithetical to the "objectives and purposes of the Code." Zurich complains that confirming the Plan would not only allow equity retain its interest but it will also effectively provide equity with distributions that are at least forty times greater than what general unsecured creditors are scheduled to receive. According to Zurich, the Plan grants equity an exclusive right to make a minimal contribution in exchange for retention of their ownership in a business that appears to and will remain highly profitable, such a result runs contrary to the Bankruptcy Code and the binding Supreme Court precedent on the matter. Attorneys for Zurich American Insurance Company of Illinois: Lincoln V. Horton, Esq. Horton Village Law Group, APC 16236 San Dieguito Blvd., Suite 5-24 P.O. Box 9181 Rancho Santa Fe, CA 92067 Tel: (858) 832-8685 Email: lhorton@hortonvillagelaw.com -- and -- Susan N.K. Gummow, Esq. Igor Shleypak, Esq. FORAN GLENNON PALANDECH PONZI & RUDLOFF P.C. 222 N. LaSalle St., Ste. 1400 Chicago, IL 60601 Tel: (312) 863-5000 Fax: (312) 863-5099 Email: sgummow@fgppr.com ishleypak@fgppr.com About Ameriquest Security Service Ameriquest Security Service is in the security guard service business based in Culver City, California. Ameriquest filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 18-21241) on Sept. 25, 2018. In the petition signed by Akram Gendy, president and CEO, the Debtor estimated $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. The Hon. Julia W. Brand oversees the case. Michael Jay Berger, Esq., at the Law Offices of Michael Jay Berger, serves as bankruptcy counsel. ASTRIA HEALTH: $28-Mil. Interim Access to Bankruptcy Financing -------------------------------------------------------------- Judge Frank L. Kurtz entered an interim order authorizing Astria Health, et al., to access $28 million in bankruptcy financing from JMB Capital Partners Lending, LLC, as lender. The Debtors asserted that they have an immediate need to obtain the postpetition financing in order to, among other things, permit the orderly continuation of the operation of their businesses, minimize the disruption of their business operations, and preserve and maximize the value of the assets of their bankruptcy estates in order to maximize the recovery to all creditors of the estates. The Debtors are also granted access to their cash collateral. A final hearing for the DIP Financing Motion has been scheduled for June 12, 2019. About Astria Health Astria Health and its subsidiaries -- https://www.astria.health -- are a nonprofit health care system providing medical services to patients who generally reside in Yakima County and Benton County, Washington through the operation of Sunnyside, Yakima, and Toppenish hospitals, as well as several health clinics, home health services, and other healthcare services. Collectively, they have 315 licensed beds, three active emergency rooms, and a host of medical specialties. The Debtors have 1,547 regular employees. Astria Health and 12 of its subsidiaries filed for bankruptcy protection (Bankr. E.D.Wash, Lead Case No. 19-01189) on May 6, 2019. In the petitions signed by John Gallagher, president and CEO, the Debtors estimated assets and liabilities of $100 million to $500 million. The Hon. Frank L. Kurtz oversees the cases. Bush Kornfeld LLP and Dentons US LLP serve as the Debtors' counsel. Kurtzman Carson Consultants, LLC, is the claims and noticing agent. ATLANTIC INTERNATIONAL: Chapter 15 Case Summary ----------------------------------------------- Chapter 15 Debtor: Atlantic International Bank Limited #1 Belcan Plaza Belize City Belize Business Description: Atlantic International Bank Limited is an international banking company that offers banking services or offshore services to both personal and corporate clients who are non-residents of Belize. For more information, visit http://www.atlanticibl.com. Foreign Proceeding: Liquidation pursuant to Section 26 of the International Banking Act, Chapter 267, Revised Edition 2011 of the Substantive Laws of Belize Chapter 15 Petition Date: May 13, 2019 Court: United States Bankruptcy Court Southern District of Florida (Miami) Chapter 15 Case No.: 19-16286 Judge: Hon. Robert A. Mark Foreign Representative: Julian Murillo Foreign Representative's Counsel: Patricia A. Redmond, Esq. STEARNS WEAVER MILLER WEISSLER ALHADEFF & SITTERSON, P.A. 150 W Flagler St #2200 Miami, FL 33130 Tel: 305-789-3553 Email: predmond@stearnsweaver.com Estimated Assets: Unknown Estimated Debt: Unknown A full-text copy of the Chapter 15 petition is available for free at: http://bankrupt.com/misc/flsb19-16286.pdf BARCORD INC: To Hold Public Auction on May 21 --------------------------------------------- Pursuant to the authority of the order approving the second amended bidding procedures, to reschedule auction and hearing entered on April 17, 2019, by the U.S. Bankruptcy Court for the Northern District of Illinois, Barcord Inc. will conduct a public auction of the real estate located at 1648 W. Kinzie St., Chicago, Illinois, consisting of a 28,635 sq. ft. building on a 12,736 sq. ft. site located in the Kinzie Corridor in Chicago, Illinois. The Auction will occur on May 21, 2019, at 11:00 a.m. (Center Time), at the office of Bryan Cave Leighton Paisner LLP, 161 N. Clark St. Suite 4300, Chicago, Illinois 60601. In order to be eligible to participate in the auction, a person must submit a qualified bid for the assets to the Debtor no later than 12:00 p.m. (Central Time) on May 16, 2019. For more information regarding the public auction, contact: Joshua D. Green Springer Brown LLC 300 South County Farm Road, Suite 1 Wheaton, Illinois 60187 Tel: (630) 510-0000 E-mail: jgreene@springerbrown.com -- and -- Nick Saraceno CTK Chicago Partners 1659 West Hubbard Chicago, Illinois 60622 Tel: (312) 337-1334 Cel: (847) 331-1339 E-mail: nsaraceno@ctkcp.com About Barcord Inc. Barcord, Inc., is a real estate company that has 100% ownership interest in a property located at 1648 West Kinzie St., Chicago, Illinois 60622 valued by the Company at $2.4 million. Barcord sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 18-14974) on May 23, 2018. In the petition signed by its president James Aitcheson, the Debtor disclosed $2.40 million total assets and $2.23 million total debt. Judge Carol A. Doyle oversees the case. Joshua D. Greene, Esq., of Springer Brown, LLC, serves as the Debtor's counsel. BEAUTIFUL BROWS: Hires Southeastern Business as Business Broker --------------------------------------------------------------- S. Gregory Hays, the Chapter 11 Trustee of Beautiful Brows LLC, seeks authority from the U.S. Bankruptcy Court for the Northern District of Georgia to employ Southeastern Business Intermediaries, LLC, as business broker to the Trustee. The Trustee requires Southeastern Business to assist with the orderly liquidation of the Debtor's assets in order to maximize the return to creditors. Southeastern Business will be paid 6% commission of the gross price paid for all assets sold on behalf of the Trustee. Harold Kolbe, broker of Southeastern Business Intermediaries, LLC, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Southeastern Business can be reached at: Harold Kolbe SOUTHEASTERN BUSINESS INTERMEDIARIES, LLC 3605 Sandy Plains Road, Suite 240-195 Marietta, GA 30066 Tel: (678) 557-8866 About Beautiful Brows Beautiful Brows LLC, based in Tucker, Georgia, primarily operates in the skin care business within the personal services industry. Beautiful Brows filed a Chapter 11 petition (Bankr. N.D. Ga. Case No. 18-66766) on Oct. 3, 2018. In the petition signed by Saleema Delawalla (f/k/a Fnu Saleema), member, the Debtor estimated $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. Jason L. Pettie, Esq., at Jason L. Pettie, P.C., serves as bankruptcy counsel to the Debtor. The case is assigned to Judge Jeffery W. Cavender. S. Gregory Hays was appointed as the Debtor's Chapter 11 trustee. The Trustee tapped Hays Financial Consulting, LLC, as his accountant; and Bullseye Auction & Appraisal, LLC, for the marketing and sale of the Debtor's personal properties. BENCHMARK ELECTRONICS: S&P Lowers ICR to 'BB-'; Outlook Stable -------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on electronics manufacturing services (EMS) provider Benchmark Electronics Inc. to 'BB-'. The rating agency based the downgrade on its expectation for a continued decline in operating performance due to semi-cap weakness, which will preclude the improvement in credit metrics it previously expected. S&P also based its downgrade on two years of low unadjusted free operating cash flow (FOCF) generation, with $10 million in 2018 and its expectation for the same amount by the end of 2019. In 2019, the expected low unadjusted FOCF is in large part due to S&P's expectation for roughly $50 million in working capital use, despite declining revenue that the rating agency expects to result in working capital monetization. "The stable outlook reflects our expectation that leverage will stay below 3x even with large revenue declines in the computing and T&I segments because of our expectation for modest profitability improvement. Benchmark's strong cash balance, shift to higher-margin product segments, and good customer relationships should keep leverage below 3x during 2019 and 2020," S&P said. S&P said it could lower the rating if Benchmark sustains leverage above 4x or adjusted FOCF to debt below 10%, adding that this could occur with a large decline in revenue from higher-margin product segments such as A&D or medical. The company could also breach these thresholds with a debt-financed acquisition, according to the rating agency. "While unlikely over the next 12 months, we could raise the rating if Benchmark sustains unadjusted FOCF above $50 million, adjusted FOCF to debt above 15%, and increases EBITDA and revenue. This could happen if the semi-cap market recovers, Benchmark generates new customer wins, or it expands operational efficiencies," S&P said. BENTWOOD FARMS: Rabo AgriFinance Objects to Disclosure Statement ---------------------------------------------------------------- Rabo AgriFinance LLC objects to the proposed Disclosure Statement explaining the Chapter 11 Plan of Bentwood Farms, LLC. The Creditor points out that the Debtor's Disclosure Statement does not give sufficient information regarding the proposed marketing of property subject to Rabo's lien. The Creditor further points out the Debtor's Disclosure Statement contains no information regarding the treatment of Rabo's claim in the event it chooses to make an 1111(b) election. The Creditor complains that the Debtor's Disclosure Statement provides no reasonable basis for splitting the unsecured class in two by putting deficiency claims in one class and all other unsecured creditors in a separate class. According to the Creditor, this is not a case where the Debtor's Plan might be confirmable if the informational deficiencies in the Disclosure Statement are cured. Instead, this Plan cannot be confirmed as a matter of law. Attorney for Rabo: Constance L. Young, Esq. Womble Bond Dickinson (US), LLP 301 South College Street, Suite 3500 Charlotte, NC 28202 Tel: (704) 331-4972 Fax: (704) 331-4955 Email: Constance.Young@wbd-us.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. GreerWalker LLP, is the financial advisor. BIG BEAR BOWLING: Has $1M Offer for Big Bear Lake Property ---------------------------------------------------------- Big Bear Bowling Bar, Inc., asks the U.S. Bankruptcy Court for the Central District of California to authorize the sale of the improved real property at 40679 Big Bear Blvd., Big Bear Lake, California to Big Bear Cool Cabins, Inc. for $1 million. The subject property is encumbered by the following liens: (i) Note and trust deed in favor of Columbia in first position $1,378,208; and (ii) San Bernardino County Tax Collector $75,488. The subject property is one of the locations at which the Debtor carried on its businesses. However, the Debtor has shut down the business that was located on the subject property. The principle terms of the sale are as follows: 1. Purchaser: Big Bear Cool Cabins, Inc. by Alisa Armstrong CEO; 2. Purchase price: $1 million; 3. Escrow agent: Paula Fenger; 4. Escrow officer: Kim Ohlson; 5. Real estate commission: Rusty Barnes. The subject property will be sold and the proceeds paid to Columbia Bank, the holder of the note in first position on the subject property. The proceeds will not be sufficient to pay the entire obligation owing to Columbia. The subject property will be sold with a partial pay-off of the Columbia lien in first position. In addition to approval of the sale, the Debtor asks approval for the payment of real estate commissions and costs incurred in connection therewith. The sale is subject to overbid, as follows: The initial overbid must be in an amount at least 5% more than the current sale price. The overbidder must appear at the hearing and provide proof of availability of funds to the satisfaction of the Court. Thereafter, the overbidder must deposit those funds in escrow within five days after the hearing. If an overbid is approved and accepted and, thereafter, the overbidder is either unable or unwilling to complete the sale, the property will then be sold to the next highest bidder, whether that be another overbidder or the original offeror. Upon the consummation of a sale of the subject property to any Third Party who submits the Prevailing Bid, and provided that Purchaser is not in breach of a material provision of the Agreement, the Seller will pay to the Purchaser from the proceeds of such sale in cash or other immediately available funds an amount equal to 3% of the cash portion of the Purchase Price the "Breakup Fee." The Debtor believes that the proposed sale is in the best interests of the estate and will maximize the return to creditors. The Debtor filed a Plan of Reorganization on Jan. 17, 2019, and filed an amended Plan on March 25, 2019, payment of 100% of the debt owed, including all claims and the remaining portion of the obligations owing to Columbia. The Debtor asks the Court to waive the 10-day stay under Federal Rule of Bankruptcy Procedure, Section 6004(g). A hearing on the Motion is set for May 14, 2019 at 1:30 p.m. A copy of the Agreement attached to the Motion is available for free at: http://bankrupt.com/misc/Big_Bear_137_Sales.pdf About Big Bear Bowling Barn Big Bear Bowling Barn, Inc., owns the Bowling Barn located at 40625 Big Bear Boulevard, Big Bear Lake, California. Bowling Barn is a 16-lane bowling facility. The company is a small business debtor as defined in 11 U.S.C. Section 101(51D) reporting gross revenue of $1.59 million in 2017 and gross revenue of $1.42 million in 2016. Big Bear Bowling Barn sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 18-12715) on April 2, 2018. In the petition signed by William Ross, president, the Debtor disclosed $1.51 million in assets and $2.18 million in liabilities. Judge Scott C. Clarkson presides over the case. Oaktree Law is the Debtor's legal counsel. Russell C. Barnes is the broker selected to market the Debtor's property located at 40679 Big Bear Blvd., Big Bear Lake, California. BRILLIANT ENVIRONMENTAL: Case Summary & 20 Top Unsecured Creditors ------------------------------------------------------------------ Debtor: Brilliant Environmental Services, LLC 534 Whitesville Rd Jackson, NJ 08527-5044 Business Description: Brilliant Environmental Services is a full- service environmental consulting and contracting firm. The Company offers a wide array of environmental services to residential, commercial, industrial, and municipal/public clients, including investigation, remediation, brownfields redevelopment, and underground storage tank services. Chapter 11 Petition Date: May 13, 2019 Court: United States Bankruptcy Court District of New Jersey (Trenton) Case No.: 19-19682 Judge: Hon. Kathryn C. Ferguson Debtor's Counsel: Marc C. Capone, Esq. GILLMAN, BRUTON & CAPONE, LLC 60 State Route 71 Spring Lake, NJ 07762-1877 Tel: 732-528-1166 Fax: 732-528-4458 E-mail: 5325@notices.nextchapterbk.com mcapone@gbclawgroup.com Total Assets: $542,706 Total Liabilities: $1,076,034 The petition was signed by Philip Brilliant, managing member. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/njb19-19682.pdf BRISTOW GROUP: Moody's Cuts PDR to D-PD on Bankruptcy Filing ------------------------------------------------------------ Moody's Investors Service downgraded Bristow Group Inc.'s Probability of Default Rating to D-PD from Caa3-PD following the announcement that the company filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code in the Southern District of Texas. Moody's also downgraded the senior unsecured notes to C. The company's other ratings were affirmed, including the Caa3 Corporate Family Rating, Caa2 senior secured notes rating, and the SGL-4 Speculative Grade Liquidity Rating. The outlook remains negative. The Chapter 11 filing pertains only to certain Bristow entities in the US and two of its Cayman Island subsidiaries. Bristow's non-US entities, including those holding Bristow's non-US air operating certificates are not included in the Chapter 11 filings. Shortly after the actions, Moody's will withdraw all of Bristow's ratings. Issuer: Bristow Group Inc. Downgraded: Probability of Default Rating, Downgraded to D-PD from Caa3-PD Senior Unsecured Notes, Downgraded to C (LGD6) from Ca (LGD5) Affirmed: Corporate Family Rating, Affirmed Caa3 Senior Secured Rating, Affirmed Caa2 (LGD2) Speculative Grade Liquidity Rating, Affirmed SGL-4 Outlook: Maintain Negative Outlook RATINGS RATIONALE The downgrade of the PDR to D-PD from Caa3-PD reflects Bristow's bankruptcy filing on May 11, 2019. The Caa3 CFR, Caa2 senior secured notes rating and C senior unsecured notes ratings reflect Moody's view on expected recovery. Bristow is looking to reduce its heavy debt burden and return to a more sustainable capital structure through the restructuring process. The company has entered into a restructuring support agreement with the majority holders of the 8.75% senior secured notes and is having ongoing dialogue with various stakeholders. Bristow's senior secured noteholders have committed to providing a new-money $75 million term loan as well as $75 million in Debtor-in-Possession financing to support the company's operations during the reorganization. The principal methodology used in these ratings was Global Oilfield Services Industry Rating Methodology published in May 2017. Bristow Group Inc., headquartered in Houston, Texas, is a leading provider of helicopter transportation services to the oil and gas industry worldwide. BRITISH BAZAAR: To Restructure Under CCAA; Deloitte as Monitor -------------------------------------------------------------- British Bazaar Company Limited and British Confectionery Company Limited filed a Notice of Intention ("NOI") to make a Proposal under subsection 50.4(1) of the Bankruptcy and Insolvency Act on Nov. 5, 2018, and Deloitte Restructuring Inc. was appointed as the Licensed Insolvency Trustee under the NOI Filing. Furthermore, on May 1, 2019, British sought and obtained from the Supreme Court of Newfoundland and Labrador an initial order under the Companies' Creditors Arrangement Act, R.S.C. 1985, c. C-36, as amended. Deloitte Restructuring Inc. was appointed by the Court as the Monitor in these CCAA proceedings (the "Monitor"). For more information, contact: Kurt Macleod Tel: (902) 721-5602 Email: kmacleod@deloitte.ca British Bazaar retained as counsel: Tim Hill Q.C. Solicitor for the Companies Borneclarke LLP 99 Wyse Road, Suite 700 Dartmouth, Nova Scotia B3A 4S5 Tel: (902) 460-3442 Fax: (902) 463-7500 Email: thill@boyneclarke.ca The Monitor can be reached at: Mathew Harris Deloitte Restructuring Inc. 1500-1969 Upper Water Street Halifax, Nova Scotia B3J 3R7 Tel: (902) 721-5602 (902) 422-8541 Fax: (902) 423-5820 Email: mathharris@deloitte.ca A copy of the Initial Order and other materials related to these proceedings is available on the Monitor's web-site: http://www.insolvencies.deloitte.ca/en/British-Bazaar-and-British-Confectionery Based in St. John's, Newfoundland and Labrador, British Bazaar Company Limited is a wholesaler of candy and related products. BROOKFIT VENTURES: Grandave Buying Business for $750K ----------------------------------------------------- Brookfit Ventures, LLC, also known as Brook Fit Ventures LLC, doing business as Retro Fitness, asks the U.S. Bankruptcy Court for the Eastern District of New York to authorize the sale of its business as a going concern, consisting of, but not limited to, all machinery, equipment, gym memberships, customer lists, related to its pre-petition operations as a gym, to Grandave Fitness, Inc. for $750,000, subject to overbid. The Debtor's creditor body consists of secured debt in the approximate amount of $280,928; priority unsecured debt of approximately $70,885; and general unsecured debt in an amount of approximately $315,705. The Debtor's financial difficulties arose as a result of a combination of factors. On June 27, 2018, the Debtor's landlord, LNA Realty Holdings, LLC, commenced a nonpayment proceeding seeking to obtain a warrant of eviction forcing the Debtor from its location. LNA has alleged that the Debtor is in default in the approximate amount of $231,000. In addition, the debt owed to the secured creditors has been difficult to manage. The Debtor also fell behind on the payment of its sales tax obligations to New York State. The Debtor believes that its Lease has significant value. That, coupled with the Retro Fitness franchise agreement, has allowed the Debtor to conclude that it should be able to market and sell the business and make a significant distribution to its creditors. It desires to sell its business as a going concern in order to maximize creditor recovery in the case. In furtherance of this, after extensive due diligence, the Debtor filed an Application to retain Integrity Square, LLC ("ISQ"), as a business broker to sell its business. Prior to the Petition Date, Debtor entered into an agreement with ISQ on July 8, 2018, pursuant to which ISQ was to assist the Debtor with the marketing and selling of the gym. ISQ proceeded to find a suitable business opportunity acceptable to the Debtor whereby the Debtor may be acquired by purchase of stock, purchase of assets, assumption of liabilities, merger, a royalty or percentage of sales arrangement, reorganization or other form of business combination. As a result of those efforts, the Debtor has entered into the APA with Grandave or its designee, having an address at 667 Grand Street, Brooklyn, New York 11211. The salient terms of the Transaction are: a. The Purchaser will purchase any and all of the Seller's Estate's rights title and interest in and to the FF&E, the POS, the Supplies, the Equipment Related Property, the Intangible Property, the Lease, the ABC Contract, the Licenses and the Customer Contracts, and (ii) the Seller will assume and assign any and all of Seller's Estate's right, title and interest in and to the Lease, ABC Contract, Licenses and the Customer Contracts to the Purchaser. b. The purchase and sale of the Acquired Assets set forth in Section 1.1 will be free and clear of all liens, claims, encumbrances or any other right of any third party. The Seller's Estate will be responsible for paying any cure amounts resulting from its assumption of each and every of the Assigned Contracts. With the exception of the foregoing, and except as otherwise expressly provided herein, the Purchaser will not assume, pay or discharge any liability or obligation of Seller or the Estate. c. In consideration for the purchase of the Acquired Assets and assumption and assignment of the Assigned Contracts, and in full payment therefor, Purchaser will pay or cause to be paid to the Seller an amount equal to $750,000. The Purchase Price will be treated as comprised of the following components: (i) Equipment - $350,000; (ii) Lease - $350,000; and (iii) Goodwill - $50,000. d. The Parties agree to use the foregoing allocation, which was the result of arms'-length negotiations, for purposes of all Federal, State and local tax returns. e. The Purchase Price will be paid as follows: (i) Upon execution of this Agreement, the Purchaser will deposit $75,000 with the Seller's attorney by bank or certified check payable to Siegel & Reiner, LLP, as attorney, to be held in escrow by the Seller's attorney pending Closing. (ii) Upon Closing, the Purchaser will remit the balance of the Purchase Price (i.e., $675,000 or such greater amount as may be due as a result of an auction, less any adjustments) to the Seller, and the Deposit will be credited towards the Purchase Price. In the event the Purchase Price for the contemplated transaction is greater than $750,000 because of an auction at which the Purchaser is the successful bidder, the Parties agree to proportionately adjust the allocations set forth in Section 2.1 and the Deposit will be increased to 10% of the auction price within two business days of the auction. f. As part of the negotiations with Grandave, the Debtor agreed to a Break-up fee of 3% of the Purchase Price, which would be $22,500. The bidding increments would be in $25,000 increments, with the Debtor having the right to change those amounts after the initial overbid, which would be a total of $47,500. g. The Seller agrees that no qualified bid will be deemed higher or better than the Stalking Horse Bid unless such competing, qualified bid is equal to or greater than $775,000. Subsequent bid increments will begin and continue at no less than 25,000 higher than the previous bid during each round of bidding. h. The APA from Grandave calls for the assumption and assignment of the Debtor's Lease, so the relief sought includes the Debtor's Motion to assume and assign its non-residential lease for real property. Since LNA's Claim for its cure payment is under objection by the Debtor. The full amount of that Claim will be held in escrow pending a final order resolving that Objection. i. The APA does not call for the assumption of the Retro Fitness franchise agreement, and this motion seeks to reject that executory contract. j. The Lease is to be assumed and assigned upon closing to Grandave free and clear of any right or claim of Retro. k. The sale will be free and clear of all liens, claims, encumbrances and other interests with such liens, claims, encumbrances and other interests to attach to the proceeds of the sale . l. Deposit: 10% of the proposed Purchase Price m. Initial Overbid: $797,500 n. Objection Deadline: 10:00 a.m. (ET), two business days prior to the day the Sale Hearing The Debtor has exercised its business judgment in determining that the assumption of the Lease is in its best interest and in the best interest of its estate, creditors, and all parties in interest. A copy of the APA and the Bidding Procedures attached to the Motion is available for free at: http://bankrupt.com/misc/Brookfit_Ventures_92_Sales.pdf About Brookfit Ventures Brookfit Ventures LLC filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 18-46224) on Oct. 30, 2018. In the petition signed by David Ragosa, managing member, the Debtor estimated less than $50,000 in assets and less than $1 million in liabilities. The Debtor is represented by Avrum J Rosen, Esq. of Rosen, Kantrow & Dillon, PLLC. BROOKLYN BUILDINGS: Unsecureds to Get 100% from Sale Proceeds ------------------------------------------------------------- Brooklyn Buildings, LLC, filed a Chapter 11 plan of reorganization and accompanying disclosure statement. Class 6 consists of the Allowed Unsecured Claims, which shall receive 100% on the Allowed Class 6 Claims. Allowed Class 6 Claims shall be paid in full from the proceeds from the sale of the Properties upon the payment in full of all Allowed Class 1, 2, 3 4 and 5 creditors and in accordance with the Cash Flow Projection. The Debtor estimates that Class 6 Allowed Unsecured Claims total approximately $200,000. The Plan will be funded with a combination of the Equity Contribution, the Exit Loan and proceeds from the sale of the Properties which shall be effectuated in accordance with the HPD Project Worksheet and the GCRE Projection and Analysis. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/y4nwk38n from PacerMonitor.com at no charge. About Brooklyn Buildings Brooklyn Buildings LLC is a privately held real estate company. Its principal place of business is located at 1600 Bergen Street Brooklyn, New York. Brooklyn Buildings filed for bankruptcy protection (Bankr. E.D.N.Y., Case No. 18-43971) on July 11, 2018. In the petition signed by Yehoshua Allswang, managing member, the Debtor estimated assets of $10 million to $50 million and estimated liabilities of $1 million to $10 million. Judge Carla Craig oversees the case. Kirby Aisner & Curley LLP represents the Debtor as bankruptcy counsel. BUCKEYE PARTNERS: Fitch Puts BB Subordinated Debt on Watch Neg. --------------------------------------------------------------- Fitch Ratings has placed the ratings of Buckeye Partners, L.P.'s on Rating Watch Negative following its agreement to be acquired by IFM's Global Infrastructure Fund. Buckeye's Long-term Issuer Default Rating and senior unsecured rating are 'BBB-'. Its junior subordinated debt is rated 'BB'. The Rating Watch Negative reflects Fitch's concerns about Buckeye once it is owned by IFM. There is no clarity on future operating strategies, financial targets or the capital structure. Furthermore, ownership of Buckeye by an infrastructure fund rather than public ownership could potentially result in more aggressive financial policies. KEY RATING DRIVERS IFM Acquiring Buckeye: IFM's Global Infrastructure Fund is acquiring Buckeye in an all-cash transaction. Cash for the equity units is valued at $6.5 billion and the total consideration is $10.3 billion. The acquisition is subject to customary closing conditions and regulatory approval. The transaction is expected to close in the fourth quarter of 2019. Significant Uncertainty: At this juncture, the future owner, IFM, has not indicated what its intentions are for Buckeye's future capital structure. Since IFM is paying unitholders $6.5 billion in cash, Fitch believes that IFM may use debt to fund a portion of the purchasing cash. It should be noted that Australia-based IFM has over 20 years of experience with infrastructure investments. It manages $39 billion of infrastructure assets globally. DERIVATION SUMMARY Buckeye's 'BBB-' rating is the same as its peer, Plains All American, LP (PAA). Both partnerships have cut distributions to increase retained cash flows and sold assets to reduce leverage. They are both standalone partnerships focused on crude oil and refined products midstream assets. Buckeye has a higher percentage of fee-based cash flows versus PAA; however, PAA is a larger, more diverse MLP with lower leverage. Buckeye is also smaller and less diverse than similarly rated MPLX LP (BBB-/Rating Watch Positive), which is now merging with its sister MLP to become a large scale midstream issuer. On a pro forma basis, MPLX has lower leverage, high distribution coverage and a strong sponsor. Fitch expects MPLX's pro forma leverage to be in the low 4.0x area at the end of 2019. In addition to crude oil and refined products and storage, MPLX also has significant gathering and processing operations. KEY ASSUMPTIONS Fitch does not have clarity on Buckeye's future financial policies. RATING SENSITIVITIES Developments That May, Individually or Collectively, Lead to Positive Rating Action - Fitch may stabilize the ratings if the future of the capital structure and financial policies are in line with 'BBB-' ratings for a company with Buckeye's size, scale and cash flow profile; - Favorable rating action could occur if total debt to adjusted EBITDA was below 4.0x on a sustained basis. Developments That May, Individually or Collectively, Lead to Negative Rating Action - Fitch may downgrade the rating if Buckeye's future capital structure and financial policies are more aggressive; - The rating may be downgraded to 'BB+' if total debt to adjusted EBITDA was above 5.0x on a sustained basis if Buckeye has the same size, scale and cash flow profile. LIQUIDITY AND DEBT STRUCTURE Adequate liquidity: As of March 31, 2019, Buckeye had more than $1.3 billion of liquidity. Cash on the balance sheet was $2.0 million. The partnership had more than $1.3 billion undrawn on its $1.5 billion unsecured revolver. In September 2016, Buckeye extended the credit facility by a year to September 2021. The nearest debt maturity is in February 2021 when $650 million of notes become due. SUMMARY OF FINANCIAL ADJUSTMENTS Fitch applies 50% equity credit to $400 million of junior subordinated notes that were issued in January 2018. Fitch also excludes equity in earnings of unconsolidated affiliates, but includes cash distributions from unconsolidated affiliates. PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS The Rating Watch Negative is directly linked to Buckeye's agreement to be acquired by IFM. If the acquisition does not occur for an unforeseen reason, there could also be a change in Fitch's view that could result in a different rating action. CAFFE VALDINO: Seeks to Hire Tarter Krinsky as Counsel ------------------------------------------------------ Caffe Valdino, Inc., seeks authority from the U.S. Bankruptcy Court for the Southern District of New York to employ Tarter Krinsky & Drogin LLP, as counsel to the Debtor. The Debtor initially hired Richard Byron Peddie as counsel. Caffe Valdino requires Tarter Krinsky to: (a) give advice to the Debtor with respect to its powers and duties as a debtor-in-possession in the continued operation of its business and management of its property; (b) negotiate with creditors of the Debtor in working out a plan of reorganization, and to take necessary legal steps in order to confirm said plan of reorganization, including, if need be, negotiations in financing a plan of reorganization; (c) prepare on behalf of the Debtor, as debtor-in-possession, necessary applications, answers, orders, reports and other legal papers; (d) appear before the bankruptcy judge and to protect the interests of the debtor-in-possession before the bankruptcy judge, and to represent the Debtor in all matters pending in the chapter 11 proceeding including the pending motion to appoint a chapter 11 trustee or to convert this case to chapter 7; and (e) perform all other legal services to the Debtor, as debtor- in-possession, which may be necessary herein. Tarter Krinsky will be paid at these hourly rates: Partners $510 to $700 Counsels $470 to $640 Associates $310 to $510 Paralegals $260 to $310 Tarter Krinsky will be paid a retainer in the amount of $15,000. Tarter Krinsky will also be reimbursed for reasonable out-of-pocket expenses incurred. Scott S. Markowitz, a partner of Tarter Krinsky & Drogin, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Tarter Krinsky can be reached at: Scott S. Markowitz, Esq. TARTER KRINSKY & DROGIN LLP 1350 Broadway, 11th Floor New York, NY 10018 Tel: (212) 216-8000 E-mail: smarkowitz@tarterkrinsky.com About Caffe Valdino Caffe Valdino, Inc., filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 19-10436) on Feb. 12, 2019, estimating under $1 million in both assets and liabilities. Tarter Krinsky & Drogin LLP is presently the Debtor's counsel, substituting for Richard Byron Peddie, Esq. CALIFORNIA PALMS: Selling Four-Story Austintown Hotel for $3.7M --------------------------------------------------------------- California Palms, LLC, asks the U.S. Bankruptcy Court for the Northern District of Ohio to authorize the sale of a 66,000 square foot four-story hotel with 122 guest rooms in Austintown, Ohio to California Palms, Inc. and California Palms Addiction Recovery Campus, Inc. for $3.7 million, plus payment of all necessary closing costs. In 2012, California Palms Hotel, Inc. (later renamed California Palms, Inc.) purchased the property. California Palms Hotel, Inc. put $6 million into buying and renovating the four-story building. The $6 million invested by California Palms, Inc. was noted recently in by Pender Capital in an email to a potential buyer of its note "Borrowers invested $5,000,000 into the renovation after acquisition additional $1.2 million." On Feb. 1, 2017, the California Palms Hotel, Inc., closed and the hotel was leased to California Palms Addiction Recovery Campus, Inc. ("CaliParc") who began operating a substance abuse and behavioral health treatment center for veterans and active military. The California Palms Hotel, Inc., became the landlord and under the terms of the lease ceased all maintenance of the building. CaliParc assumed maintenance of the building. After spending $6 million of its own money, California Palms Hotel borrowed $2.8 million to finish the renovations. In late 2017, California Palms, Inc., and CaliParc sought to refinance the $2.8 million encumbrance and to secure working capital for CaliParc. On Jan. 6, 2018, California Palms, Inc. executed a letter of intent with Pender Capital Asset Based Lending Fund I, LP, a Delaware Limited Partnership and Pender Capital, Inc. for a $3.4 million loan. Simultaneous with closing the loan, California Palms, Inc. transferred the property to the Debtor at the request of Pender. California Palms, Inc., held $6 million in equity, twice the amount funded by Pender when it transferred ownership to the Debtor. On March 12, 2018, Pender increased the loan to $4 million and the Debtor signed a promissory note, mortgage, and draft borrower's statement. The Debtor believed as Pender represented, that the loan included interest reserves for the full term of the loan. On March 12, 2018, the Debtor signed the Open-End Mortgage ("Mortgage"). The maximum indebtedness secured by the Instrument which may be outstanding at any time is $3.4 million. At closing of the loan the title company paid $3,118,208 for existing liens and title company fees. The Debtor believed that the $881,795 remaining was for mortgage interest payments and for working capital to operate the addiction and mental health facility. On March 20, 2018, eight days after the Note and Open-End Mortgage was signed and recorded, Pender asking Debtor in an e-mail to execute and notarize and initial each page of a Business Loan Agreement. The Debtor rejected the Business Loan Agreement which dramatically changed the terms of the Promissory Note and Open-End Mortgage. Over one month after the closing, the Title Company swapped signatures in an effort to manufacture a final closing disbursement. Pender refused to disburse the remaining funds and was fully aware the un-disbursed funds had a material impact on Debtor and CaliParc's operations. On April 19, 2018, the Debtor filed suit to rescind the loan. The unexpected withholding of $881,880 breached the Open-End Mortgage and Promissory Note. On Nov. 8, 2018, the parties entered into a Settlement Agreement. The Agreement did not amend the Open-End Mortgage which remains recorded to this day and limits the mortgage to a maximum of $3.4 million. The Open-End Mortgage matures on March 1, 2019, two days after the Petition was filed on Feb. 27, 2019. The Settlement Agreement brought the loan current, and provides a pay-off for the first time allowing the Debtor to refinance Pender's loan. Pender agreed to accept $3.6 million if the closing occurred on by Dec. 31, 2018, $3.7 million if the closing occurred by Jan. 31, 2019, and $3.8 million if the closing occurred by Feb. 28, 2019 (the date the Petition was filed). The Debtor secured financing in January and sought to pay Pender $3.7 million at closing. The Title Company handling the closing sent emails to Pender and made multiple phone calls to Pender seeking a payoff amount to close the loan and releases for all liens associated with the property. Pender breached the Settlement Agreement. Pender also did not provide for a 10-day cure period of any default provided. The Open-End Mortgage was never amended or fully funded. It limited the loan sum to $3.4 million and provided until March 1, 2019, as the maturity date of the mortgage. The Debtor agrees to pay Pender $3.7 million at closing on May 6, 2019. This sum is well beyond the $3,187,052 secured portion of Pender's claim. If the $3,187,052 advanced includes interest, the $3.7 million covers the sum advanced with interest as of May 6, 2019 which totals $3,699,251 (($3,187,052 x 14% x 419/365) + $3,187,052). Since early January, California Palms, Inc. which was not a party to the state lawsuit or the Settlement Agreement partnered with CaliParc to secure a loan to buy the property. California Palms, Inc. held $6 million in equity in the building when it transferred the property to the Debtor, as required by Pender to fund the loan. CaliParc operates the veteran recovery facility and is the source for all future income. California Palms, Inc. and CaliParc entered into a contract to purchase the property from the Debtor for $3.7 million, the pay-off sum Pender agreed to for closing on Jan. 31, 2019. California Palms, Inc. and CaliParc have sought to secure financing to repay Pender's loan and secure working capital for CaliParc. California Palms, Inc. and CaliParc were the borrowers for the loan to lender Atlantic Union in January when Pender refused to provide lien waivers before closing. California Palms, Inc. and CaliParc, secured another loan to pay Pender and for working capital from NewTech, one of the largest SBA lenders in the country. The NewTech loan is scheduled to close on May 6, 2019. Upon approaching Pender for the closing on May 6, 2019, Pender demanded $4,975,397 as a pay-off of its loan. It increased the loan pay-off from $3.7 million on Jan. 31, 2019, by a whopping $1.3 million for a closing a mere three months. This equates to an interest rate of 138%. The interest rate five times the statutory maximum. The Debtor is entitled to an accurate pay-off of the loan. Pender has used its breach of the loan to manipulate the amount due for an honest pay-off figure. Absent the Court authorization to sell the property free and clear of liens for $3.7 million, Pender will use obstructionism to hide its criminally usurious calculations and oppressive conduct to seize the property using an inflated pay-off of the loan. The time between March 12, 2018, at loan closing and May 6, 2019, the date of the proposed closing, is 419 days. Using $3,187,052, the sum Pender claims it funded at closing, at the agreed 14% interest rate. The calculation using simple interest as provided in the Note results in a loan pay-off of $3,699,251 (($3,187,052 x 14% x 419/365) + $3,187,052). The Debtor is entitled to an accurate pay-off of the loan, based on the sum actually funded ($3,187,052), at the agreed 14% interest rate. The Debtor asks an order of the Court authorizing it to go forward with the sale of the property directing no liens exist against the property and that the $3.7 million from the sale be paid to Pender and applied against full repayment of the promissory note. California Palms, Inc. agrees to remove its $6 million credit. About California Palms California Palms, LLC, is an Ohio limited liability company that operates residential mental health and substance abuse facilities. California Palms filed a Chapter 11 petition (Bankr. Case No. 19-40267) on Feb. 27, 2019. In the petition signed by Sebastian Rucci, managing member, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in liabilities. The case is assigned to Judge John P. Gustafson. The Debtor is represented by Sebastian Rucci, Esq. at the Law Office of Sebastian Rucci. CAROL ROSE: $380K Sale of Gainesville Property to DOT Approved -------------------------------------------------------------- Judge Brenda T. Rhoades of the U.S. Bankruptcy Court for the Eastern District of Texas authorized Carol Rose, Inc.'s sale of the portions of Parcels 11, 13, 18, and 21 in the 253 acres of real property located at 4500 N. I-35, Gainesville, Texas to Texas Department of Transportation for $379,743. The sale is free and clear of all liens, claims, encumbrances, and interests. The Settlement with the State of Texas is additionally approved under Bankruptcy Rule 9019. The stay provided for in Federal Rule of Bankruptcy Procedure 6004(h) is waived and the Order is executory and effective upon entry. About Carol Rose Carol Rose, Inc. -- http://carolrose.com/-- owns a horse breeding facility in Gainesville, Texas. It provides on-site breeding, cooled semen, embryo transfer, mare care and maintenance and foaling services. It is owned by Carol Rose, a National Reined Cow Horse Association (NRCHA) and National Reining Horse Association (NRHA) breeder. Ms. Rose is the sole director and shareholder of the Debtor. Carol Rose, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Tex. Case No. 17-42058) on Sept. 19, 2017. In the petition signed by owner Carol Rose, the Debtor estimated assets of $10 million to $50 million and liabilities of less than $500,000. Judge Brenda T. Rhoades oversees the case. Gardere Wynne Sewell LLP is the Debtor's bankruptcy counsel. Kelly Hart & Hallman LLP/Kelly Hart & Pitre is special counsel. CATHAY GENERAL: Fitch Affirms 'BB+/B' LongTerm IDRs --------------------------------------------------- Fitch Ratings has affirmed Cathay Bank's Long-Term Issuer Default Rating at 'BBB-', Viability Rating at 'bbb-', and Short-Term IDR at 'F3'. The Rating Outlook is Stable. In addition, Fitch has affirmed Cathay General Bancorp's Long-Term IDR at 'BB+' and VR at 'bb+'. The rating actions follow a periodic review of the mid-tier banking group, including: First National of Nebraska, Inc. (FNNI), Fulton Financial Corporation (FULT), Community Bank System, Inc. (CBU), Trustmark Corp. (TRMK), Hilltop Holdings Inc. (HTH) and Cathay General Bancorp (CATY). Company-specific rating rationales for the other banks will be published separately. KEY RATING DRIVERS IDRs, NATIONAL RATINGS AND SENIOR DEBT The rating action reflects CATY's consistently high levels of profitability, solid asset quality and strong capital levels, which, in Fitch's view, bring its risk profile in line with investment grade peers. CATY's profitability remains strong and is a rating strength. In 2018, return on average assets was 1.7%, well above the peer median of 1.3% and one of the highest in Fitch's mid-tier banking group. Additionally, CATY's efficiency ratio at 44% as of Dec. 31, 2018 was the lowest in the peer group and compares very favorably to the peer median of 62%. Net interest margin (NIM) expansion over the rate hike cycle played a large part in the increased earnings, widening from roughly 3.3% at year-end 2015 to approximately 3.8% as of year-end 2018. Asset quality at CATY continues to improve. Non-performing assets, including accruing troubled debt restructures, fell from 1% of total loans and other real estate owned at the end of 2017 to approximately 0.9% as of Dec. 31, 2018. This is well below the 1.09% mid-tier peer median. The bank remained in a net recovery position in 2018, with net chargeoffs of -0.03%, the lowest in the peer group. Fitch attributes this performance to CATY's strong underwriting practices. CATY grew loans by 8.7% in 2018, above the peer median of 4.6%, but in line with prior years. Fitch views this level of growth as manageable, given the company's consistent internal capital generation. Fitch has adopted a cautious view towards loan growth at this stage of the credit cycle and notes that growth at CATY, specifically, and the mid-tier banks as a whole has outpaced that of the Large Regional peer group. CATY has demonstrated a strong ability to internally generate capital. Following the acquisition of SinoPac Bancorp, CET1 dipped 65bps to 12.19% at the end of 2017; however, by year-end of 2018, the company had already lifted capital back up 24bps to 12.43%. CATY accomplished this through strong earnings and by maintaining a dividend payout ratio of approximately 30%-40%. Fitch expects CATY will continue to manage capital conservatively over the near- to mid-term. LONG- AND SHORT-TERM DEPOSIT RATINGS Cathy Bank's uninsured deposit ratings are rated one notch higher than the bank's Long-Term IDR and senior unsecured debt as U.S. uninsured deposits benefit from depositor preference. U.S. depositor preference grants deposit liabilities superior recovery prospects in the event of default. HOLDING COMPANY CATY's VR and Long-Term IDR are notched one level below those of Cathay Bank based on Fitch's view of the holding company's aggressive liquidity management. Fitch notes that CATY will continue to be reliant on dividend capacity and distributions from Cathay Bank to cover the next 12 months of shareholder dividends and other cash outflows. In Fitch's view, this approach to liquidity management is not commensurate with an investment grade rating. SUPPORT RATING AND SUPPORT RATING FLOOR CATY has a Support Rating of '5' and a Support Rating Floor of 'NF'. In Fitch's view, the probability of support is unlikely. The IDRs and VRs do not incorporate any support. RATING SENSITIVITIES IDRs, NATIONAL RATINGS AND SENIOR DEBT In Fitch's view, Cathay Bank's ratings are well situated and further upside ratings potential is limited. Positive rating pressure is possible over the long term, should Cathay Bank's asset quality continue to outperform the peer group, in terms of credit losses and NPAs, while maintaining strong earnings and continuing to manage capital conservatively. An upgrade would likely also be predicated on an improvement in the holding company's liquidity management. Fitch expects that CATY will continue to maintain higher capital levels than its peers to offset outsized growth and its commercial real estate concentration, which stood at 273% of risk-based capital as of Dec. 31, 2018. Should CATY begin to manage capital more aggressively in such a way that the bank's CET1 ratio were to fall below peer median, negative ratings pressure could develop. Fitch anticipates some deterioration in the loan portfolio as credit conditions normalize and credit losses climb from unsustainable lows. However, if CATY were to experience outsized credit losses, especially in CRE concentration, that in turn negatively impacted earnings or capital, a negative rating action could occur. LONG- AND SHORT-TERM DEPOSIT RATINGS The long- and short-term deposit ratings are sensitive to any change to Cathay Bank's Long- and Short-Term IDR. HOLDING COMPANY If CATY were to pay off the existing term note at the holding company and, subsequently, improve holding company liquidity to cover at minimum 1.0x expected annual outflows (including interest, expenses and dividends), positive ratings momentum could occur. Combined with enhanced liquidity management practices, in line with Fitch's expectations for an investment grade rated institution, it could result in positive rating action, including equalizing the holding company with the bank. SUPPORT RATING AND SUPPORT RATING FLOOR As CATY's Support and Support Rating Floor are '5' and 'NF', respectively, there is limited potential for these ratings to change in the foreseeable future. Fitch has affirmed the following ratings: Cathay Bank -- Long-Term IDR at 'BBB-'; Outlook Stable; -- Short-Term IDR at 'F3'; -- Viability Rating at 'bbb-'; -- Long-term deposits at 'BBB'; -- Short-term deposits at 'F3'; -- Support at '5'; -- Support Floor at 'NF'; Cathay General Bancorp -- Long-Term at 'BB+'; Outlook Stable; -- Short-Term IDR at 'B'; -- Viability Rating at 'bb+'; -- Support at '5'; -- Support Floor at 'NF'. CELADON GROUP: Delays Filing of March 31 Quarterly Report --------------------------------------------------------- Celadon Group, Inc., has filed with the U.S. 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 March 31, 2019. As previously disclosed, the Company has determined that its previously filed financial statements for the fiscal years ended June 30, 2014, 2015, and 2016, including the unaudited quarterly financial statements for those fiscal years, and the fiscal quarters ended Sept. 30, 2016 and Dec. 31, 2016, should no longer be relied upon. The Company is currently working to restate certain historical periods and prepare financial statements for currently unfiled periods that conform with U.S. generally accepted accounting principles and Securities and Exchange Commission rules. The Company believes that these processes will result in financial statement impacts for the fiscal quarter and nine-months ended March 31, 2019 and those impacts have not been definitively determined at this time. Accordingly, the Company's filing of financial statements for its third fiscal quarter ended March 31, 2019, will be delayed. The Company's continued evaluation of these matters will cause these financial statements to be filed after the expiration of the five calendar day extension period provided by Rule 12b-25. The Company presently expects to report a net loss for the fiscal quarter ended March 31, 2019. 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. The New York Stock Exchange notified the Securities and Exchange Commission on April 18, 2018 of its intention to remove the entire class of the common stock of Celadon Group, Inc., from listing and registration on the Exchange on April 30, 2018, pursuant to the provisions of Rule 12d2-2(b) because, in the opinion of the Exchange, the Common Stock is no longer suitable for continued listing and trading on the Exchange. CELADON GROUP: Donargo Succeeds Albrecht as CFO ----------------------------------------------- Celadon Group, Inc., appointed Vincent Donargo as its executive vice president, chief accounting officer, and chief financial officer, effective May 1, 2019. Mr. Donargo, 58, previously served as the Company's executive vice president and chief accounting officer since November 2017. Prior to joining the Company, Mr. Donargo served as executive vice president and chief financial officer of Beaulieu Group LLC, a North American carpet and flooring manufacturing company, from August 2016 to November 2017. Prior to joining Beaulieu Group, he was at Brightstar Corp., a mobile services company, serving as executive vice president Finance Operations from August 2015 to August 2016 and as executive vice president and chief financial officer from April 2014 to August 2015. Before his tenure at Brightstar, Mr. Donargo worked for Brightpoint, Inc., a publicly traded provider of worldwide distribution and integrated logistics services prior to its acquisition by Ingram Micro Inc., where he served as chief accounting officer and controller from September 2005 to May 2011 and as chief financial officer and treasurer from May 2011 to October 2012. Mr. Donargo also served as executive vice president, integration, financial planning and analysis, and finance transformation at Ingram Micro after Brightpoint's acquisition from October 2012 to April 2014. Mr. Donargo holds a B.A. in accounting from Rutgers University. Effective May 1, 2019, Thom Albrecht ceased to serve as the Company's chief financial officer and was appointed as the Company's chief commercial officer. Mr. Albrecht continues to serve as the Company's chief strategy officer. The Company said the transition from Mr. Albrecht to Mr. Donargo was not a result of any disagreement between Mr. Albrecht and the Company, its management, or the Board on any matter relating to the Company's operations, policies, or practices. In connection with the appointment, the Company and Mr. Donargo entered into an Amended and Restated Employment Agreement, dated May 1, 2019, amending certain terms and conditions of Mr. Donargo’s employment with the Company. Under the A&R Employment Agreement, Mr. Donargo (i) has a base salary of $425,000; (ii) received an equity grant in connection with his appointment; (iii) continues to be eligible to participate in future equity grants under the Company's long-term incentive program; (iv) continues to be eligible to participate in the Company's performance cash bonus program; (v) received a one-time cash bonus of $100,000; (vi) is entitled to severance pay, if the Company terminates his employment without "Cause" or he terminates his employment for "Good Reason" (in either case, not involving a "Change in Control"), equal to twenty-four months of salary continuation and COBRA continuation coverage for twenty-four months; (vii) is entitled to severance pay, if the Company terminates his employment without Cause or he terminates his employment for Good Reason, in either case, within six months prior to, or twelve months following, a Change in Control, equal to 200% of his annual base salary, 200% of the target amount of his annual cash bonus, COBRA continuation coverage for twenty-four months, and accelerated vesting of equity awards to the extent so provided in the applicable award notices; and (viii) is subject to certain nonsolicitation, noncompetition, nondisparagement, and confidentiality covenants. In addition, Kathryn Wouters has been appointed to the position of senior vice president of finance and treasurer. Ms. Wouters previously served as the Company's vice president of finance and treasurer. Ms. Wouters will have responsibility for the Company's capital structure, including refinancing its existing revolving credit facility, financing the replacement of the Company's tractor fleet, and cash management. Chief Executive Officer, Paul Svindland, commented: "Thom, Vince, and Kathryn have been key contributors as we have streamlined our business and paid down our credit facility over the past several quarters. Their title changes reflect our priorities as a newly focused asset-based truckload carrier: enhancing commercial relationships across our customer base, completing our financial statement audits and returning to public reporting, and obtaining and managing a long-term capital structure, including a refresh of our entire U.S. tractor fleet. We look forward to their continuing contributions as we move forward." 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. The New York Stock Exchange notified the Securities and Exchange Commission on April 18, 2018 of its intention to remove the entire class of the common stock of Celadon Group from listing and registration on the Exchange on April 30, 2018, pursuant to the provisions of Rule 12d2-2(b) because, in the opinion of the Exchange, the Common Stock is no longer suitable for continued listing and trading on the Exchange. CENTERSTONE LINEN: Bid Deadline for All Assets Moved to May 22 -------------------------------------------------------------- Judge Margaret Cangilos-Ruiz of the U.S. Bankruptcy Court for the Northern District of New York has issued an order (i) adjourning hearing to approve the proposed sale by Alliance Laundry & Textile Service, LLC, doing business as Clarus Linen Systems, and Atlas Health Care Linen Services Co., LLC, doing business as Clarus Linen Systems, of substantially all assets to Linen Newco, LLC for $5.15 million, subject to overbid; and (ii) adjourning related motion hearings. The Bidding Procedures Order is amended and the Sale Hearing is adjourned from 11:00 a.m. on May 8, 2019 until 11:00 a.m. on May 22, 2019 in Syracuse, New York. The Debtors will have until May 17, 2019 to execute a final Asset Purchase Agreement with Clean Textile, acceptable to HSBC Bank and the Committee, for the purchase of the Buffalo Assets. The hearings to consider the objections filed with respect to the proposed sale of the Purchased Assets are adjourned from 11:00 a.m. on May 8, 2019 until 11:00 a.m. on May 22, 2019. Any additional objections to the proposed sale of the Buffalo Assets will be filed with the Court no later than 12:00 p.m. on May 21, 2019. The Debtors will file with the Court a Sale Report concerning proposed sale of the Buffalo Assets no later than 12:00 p.m. on May 20, 2019. The hearings to consider the objections filed or deemed filed with respect to the Debtors' proposed assumption and assignment of executory contracts and unexpired leases, including, without limitation, the CHS Objection, and all objections filed or deemed filed with respect to cure amounts, are adjourned from 11:00 a.m. on May 8, 2019 until 11:00 a.m. on May 22, 2019. The hearings to consider the Motions filed by (i) Altus Management, LLC, (ii) Mount St. Mary's Hospital of Niagara Falls; (iii) the Catholic Health System and its affiliates, and (iv) Kaleida Health, Erie County Medical Center, Eastern Niagara Health Center and Niagara Falls Memorial Medical Center asking orders directing the Debtors to reject certain executory contracts are adjourned from 11:00 a.m. on May 8, 2019 until 11:00 a.m. on May 22, 2019. The evidentiary hearing with respect to the Buffalo Hospital Motions, and with respect to the objections filed or deemed filed with respect to the Debtors' proposed assumption and assignment of executory contracts and unexpired leases, including, without limitation, the CHS Objection, and with respect to the objections filed or deemed filed with respect to cure amounts, currently scheduled to be held at 10:00 a.m. on May 9, 2019, will be adjourned indefinitely, pending further order of the Court. The Buffalo Hospital Motions will be deemed to be objections that were timely filed by those moving parties with respect to the Debtors' proposed assumption and assignment of executory contracts and unexpired leases, and with respect to the Debtors' proposed cure amounts, subject to such amendment as will be appropriate in the discretion of said moving parties in the event that any evidentiary hearing on assumption or rejection goes forward. The hearing to consider the Motion filed by landlord ACN Companies, LLC asking to compel the Debtors to comply with post-petition obligations due under a lease of real property will be adjourned until 11:00 a.m. on May 22, 2019. In the event the Debtors do not execute a Final APA with Clean Textile by May 17, 2019, the Debtors will notify the Court and may request further amendments of dates set forth in the Bidding Procedures Order as amended, as appropriate. About Clarus Linen Systems Atlas Health Care Linen Services Co., LLC, Alliance Laundry & Textile Service, LLC and two other entities, all doing business as Clarus Linen Systems -- http://www.claruslinens.com/-- provide linen rental and commercial laundry services to the healthcare industry, primarily supplying scrubs, sheets, towels, blankets, patient apparel and other linen products to hospitals and healthcare clinics via long-term contacts. Atlas and Alliance currently operate five production facilities in three states (Atlas operates two facilities in New York and Alliance operates two facilities in Georgia and one in South Carolina) that provide daily pick-ups and deliveries to their customers. Centerstone Linen Services, LLC, is the corporate parent of four subsidiary corporations and provides back-office and administrative support to them. Centerstone Linen Services and its four subsidiaries (Bankr. N.D.N.Y. Lead Case No. 18-31754) in Syracuse, New York on Dec. 19, 2018. Atlas Health estimated $10 million to $50 million in assets and liabilities of the same range as of the bankruptcy filing. Centerstone Linen estimated $1 million to $10 million in assets and $10 million to $50 million in liabilities. BOND, SCHOENECK & KING, PLLC, is the Debtor's counsel. CENTURY ALUMINUM: S&P Affirms 'B' ICR; Outlook Negative ------------------------------------------------------- S&P Global Ratings affirmed its 'B' issuer credit rating on Chicago-based aluminum producer Century Aluminum Co. and its 'B+' issue-level rating on the company's senior secured notes. The '2' recovery rating is unchanged. The rating action reflects S&P's expectation for elevated debt leverage in 2019 for Century as it faces high costs for alumina, its main raw material, while it undertakes increased capex related to its Hawesville facility upgrades. S&P expects Century to generate negligible EBITDA this year as high alumina costs, relative to aluminum prices, will sharply reduce earnings in 2019. The rating agency further expects recent lower alumina spot prices to take several months to show in the company's operating results. As the company works through the remaining high-cost inventory and makes progress executing on its capex plans, S&P expects to see EBITDA generation to slowly start recovering during the second half of 2019, partially offsetting the negative first half, and continuing the recovery into 2020. "The negative outlook reflects our view that leverage could remain elevated for longer than we contemplate in our base-case forecast, potentially making it more difficult for Century to manage its senior secured $250 million notes maturing in June 2021 should market conditions not improve as expected over the next six to 12 months," S&P said. S&P said it could lower the rating on Century towards the end of 2019 if the company does not address its June 2021 bond maturity because of weak market conditions or potentially unsupportive capital markets or if the rating agency no longer expects leverage ratios to improve in 2020. "We could revise the outlook to stable if the company successfully refinanced its $250 million notes in the second half of 2019 and if market conditions improve leading to better earnings visibility heading into 2020 and indicative of leverage coming down to more manageable levels of about 4x-5x," S&P said. CHATTANOOGA MOTORS: Case Summary & 6 Unsecured Creditors -------------------------------------------------------- Two affiliates that have filed voluntary petitions seeking relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- LoanSpot, LLC 19-11975 2288 Gunbarrel Rd, No. 154-169 Chattanooga, TN 37421 Chattanooga Motors, LLC 19-11976 5950 Lee Highway Chattanooga, TN 37421 Business Description: Chattanooga Motors -- http://chattanoogamotors.com-- is a used car dealer in Chattanooga, Tennessee. LoanSpot LLC -- http://www.loanspot.us-- is a finance company for customers who purchased cars from Chattanooga Motors. Chapter 11 Petition Date: May 13, 2019 Court: United States Bankruptcy Court Eastern District of Tennessee (Chattanooga) Judges: Hon. Nicholas W. Whittenburg (19-11975) Hon. Shelley D. Rucker (19-11976) Debtors' Counsel: Jeffrey W. Maddux, Esq. CHAMBLISS, BAHNER & STOPHEL, P.C. Liberty Tower - Suite 1700 605 Chestnut Street Chattanooga, TN 37450 Tel: 423-757-0296 Fax: 423-508-1296 E-mail: jmaddux@chamblisslaw.com LoanSpot, LLC's Estimated Assets: $1 million to $10 million LoanSpot, LLC's Estimated Liabilities: $1 million to $10 million Chattanooga Motors' Estimated Assets: $1 million to $10 million Chattanooga Motors' Estimated Liabilities: $1 million to $10 million The petitions were signed by Michael Pryslak, president. A copy of LoanSpot, LLC's list of five unsecured creditors is available for free at: http://bankrupt.com/misc/tneb19-11975_creditors.pdf A copy of Chattanooga Motors' list of six unsecured creditors is available for free at: http://bankrupt.com/misc/tneb19-11976_creditors.pdf Full-text copies of petitions are available for free at: http://bankrupt.com/misc/tneb19-11975.pdf http://bankrupt.com/misc/tneb19-11976.pdf CLAREMONT HOLDING: Case Summary & 13 Unsecured Creditors -------------------------------------------------------- Debtor: Claremont Holding Co., LLC 373 South Willow Street, PMB 217 Manchester, NH 03103 Business Description: Claremont Holding Co., LLC is a privately held company in Manchester, New Hampshire. Chapter 11 Petition Date: May 13, 2019 Court: United States Bankruptcy Court District of New Hampshire (Concord) Case No.: 19-10662 Judge: Hon. Bruce A. Harwood Debtor's Counsel: William S. Gannon, Esq. WILLIAM S. GANNON PLLC 889 Elm Street, 4th Floor Manchester, NH 03101 Tel: (603) 621-0833 Fax: (603) 621-0830 E-mail: bgannon@gannonlawfirm.com Estimated Assets: $500,000 to $1 million Estimated Liabilities: $1 million to $10 million The petition was signed by Charles R. Sargent, Jr., owner. A full-text copy of the petition containing, among other items, a list of the Debtor's 13 unsecured creditors is available for free at: http://bankrupt.com/misc/nhb19-10662.pdf CLOUD PEAK: Incurs $49.7 Million Net Loss in First Quarter ---------------------------------------------------------- Cloud Peak Energy Inc. filed with the U.S. Securities and Exchange Commission on May 10, 2019, its quarterly report on Form 10-Q reporting a net loss of $49.74 million on $145.07 million of revenue for the three months ended March 31, 2019, compared to a net loss of $7.73 million on $216.30 million of revenue for the three months ended March 31, 2018. As of March 31, 2019, Cloud Peak had $882.3 million in total assets, $639.03 million in total liabilities, and $243.3 million in total equity. The Company started 2019 with cash, cash equivalents, and restricted cash of $92.1 million and concluded the three months ended March 31, 2019 with $62.8 million. The primary reason for this decrease was cash used in operating activities of $30.6 million. Cloud Peak said, "Our liquidity outlook has continued to decline since the fourth quarter of 2018, which included the termination of our Amended Credit Agreement in November 2018. Severe weather and train unavailability further compounded operational issues in the first quarter of 2019, affecting production at all three of our mines. Further, lower export prices, and lower demand overall, are expected to result in significantly lower levels of cash flow from operating activities in the future and have limited our ability to access capital markets. "In addition to our cash and cash equivalents, our primary sources of liquidity are cash from our operations and any borrowing capacity under our A/R Securitization Program. We had no availability for borrowing under the A/R Securitization Program as of March 31, 2019. Our total liquidity, which includes cash and cash equivalents, was $43.6 million as of March 31, 2019. We also have a capital leasing program, with a balance of $2.1 million as of March 31, 2019, for some of our capital equipment purchases subject to the conditions in the master lease agreement. "During the fourth quarter of 2018 and through the filing date of this Form 10-Q, we made a number of announcements regarding our engagement of various advisors to assist in reviewing alternatives including the potential sale of the Company and to assist in reviewing our capital structure and strategic restructuring alternatives. During that time, we experienced a number of adverse events that negatively impacted our financial results, liquidity and future prospects, which raised substantial doubt about our ability to continue as a going concern, and resulted in our decision to seek Chapter 11 bankruptcy protection." A full-text copy of the Form 10-Q is available for free at: https://is.gd/XbqKva About Cloud Peak Energy Cloud Peak Energy Inc. -- http://www.cloudpeakenergy.com/-- is a coal producer headquartered in Gillette, Wyoming. Cloud Peak Energy mines low sulfur, subbituminous coal and provides logistics supply services. The Company owns and operates three surface coal mines in the Powder River Basin (PRB), the lowest cost major coal producing region in the nation. The Antelope and Cordero Rojo mines are located in Wyoming and the Spring Creek Mine is located in Montana. Cloud Peak incurred a net loss of $717.96 million in 2018, following a net loss of $6.63 million in 2017. As of Dec. 31, 2018, the Company had $928.7 million in total assets, $634.98 million in total liabilities, and $293.7 million in total equity. PricewaterhouseCoopers LLP, in Denver, Colorado, the Company's auditor since 2008, issued a "going concern" qualification in its report dated March 14, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018 citing that the Company has experienced a reduction in available liquidity that raises substantial doubt about its ability to continue as a going concern. The New York Stock Exchange notified the Securities and Exchange Commission via a Form 25 on April 11, 2019 of its intention to remove the common stock of Cloud Peak Energy Inc. from listing and registration on the Exchange at the opening of business on April 22, 2019, pursuant to the provisions of Rule 12d2-2(b) because, in the opinion of the Exchange, the Common Stock is no longer suitable for continued listing and trading on the Exchange. CLOUD PEAK: Moody's Cuts CFR to 'C' on Bankruptcy Filing -------------------------------------------------------- Moody's Investors Service downgraded Cloud Peak Energy Resources LLC's Probability of Default Rating to D-PD from Ca-PD and the company's Corporate Family Rating to C from Ca. The downgrade was prompted by the company's announcement that it voluntarily filed for relief under Chapter 11 of the United States Bankruptcy Code on May 10, 2019. The Speculative Grade Liquidity rating is unchanged at SGL-4. The outlook is unchanged at stable. Downgrades: Issuer: Cloud Peak Energy Resources LLC Corporate Family Rating, Downgraded to C from Ca Probability of Default Rating, Downgraded to D-PD from Ca-PD RATINGS RATIONALE The downgrade follows the announcement that Cloud Peak Energy Inc. and substantially all of its wholly owned domestic subsidiaries have filed voluntary petitions for reorganization under Chapter 11 of the Bankruptcy Code in the U.S. Bankruptcy Court for the District of Delaware. The business will continue to operate as a "debtor in possession" under the jurisdiction of the court. The Debtors are seeking to sell all or substantially all of their assets. Upon approval by the Court, an expected $35 million Debtor-in-Possession term loan facility, along with the A/R Securitization Program, cash on hand and cash generated from the ongoing operations, will be used to support the business and the marketing and sale process. Subsequent to its actions, Moody's will withdraw all ratings. Please refer to Moody's Withdrawal Policy on moodys.com. The principal methodology used in these ratings was Mining published in September 2018. Cloud Peak Energy Resources LLC is one of the largest producers of coal in the US with three wholly-owned surface mining operations in Wyoming and Montana. The company produces subbituminous thermal coal with low sulfur content and an average heat value between 8,400 Btu and 9,350 Btu. The coal is primarily sold to domestic electric utilities. Cloud Peak is the only pure play Powder River Basin coal producer Moody's rates, and it controls an estimated 1.0 billion tons of proven and probable reserves. The company generated about $761 million of revenue in the twelve months ended March 31, 2019. CMC HEARTLAND: $40K Sale of Real Property Interests to Haweye OK'd ------------------------------------------------------------------ Judge Deborah L. Thorne of the U.S. Bankruptcy Court for the Northern District of Illinois authorized LePetomane XVIII, Inc., the Liquidating Trustee for the CMC Heartland Partners Liquidating Trust, successor to the assets of the bankruptcy estates of CMC Heartland Partners, HTI Interests, LLC, Heartland Partners, L.P., CMC/Heartland Partners Holdings, Inc., and Heartland Development Corp., to sell all of CMC's real property interests to Hawkeye Land II Co. for $40,000. The real property interests mean all of CMC's right, title and interest, legal and equitable, if any, in and to all lands and real property of every kind, character and description and wherever located now owned, leased or otherwise held by CMC, together with all of the appurtenances, tenements, hereditaments, ways, waters, minerals, rights, improvements, structures, fixtures licenses, leaseholds, easements, reversions, remainders, rents, issues, income, profits, rights, powers, franchises, privileges, immunities and other interest and items belonging to or in any way appertaining to such real property and all other property, real and personal attached to said real property, of every kind or description, wherever located, owned or held by Seller and any right, title, and interest, if any, in any real and personal property attached to said real property of every kind, character and description and wherever located now owned, leased or otherwise held by Seller together with all of the appurtenances, tenements, hereditaments, ways, waters, minerals, rights, improvements, structures, fixtures licenses, leaseholds, easements, reversions, remainders, rents, issues, income, profits, rights, powers, franchises, privileges, immunities and other interest and items belonging to or in any way appertaining to such real property and all other property, real and personal attached to said real property, of every kind or description, wherever located, owned or held in which the following entities had or have a real property interest in and in which CMC may be or is a successor in interest to the CMC Entities, and CMC Entities interests, if any, situated in the Counties and States referenced in the attached Exhibit A, together with CMC's interest, if any, in any real property not previously transferred by it, or the CMC Entities and any of their predecessors and affiliates including the Chicago Milwaukee, St. Paul and Pacific Railroad Company and its affiliates or successors in interest in any parcels, and any business records in CMC's possession specifically related to such real property interests. The Trustee and the Trust are authorized to sell the Real Property Interests to the Buyer pursuant to the terms and conditions of the Purchase Agreement. They're also authorized to enter into the Purchase Agreement and to execute such other documents, including the proposed Quitclaim Deeds, as may be required to complete the transactions contemplated thereunder. A copy APA attached to the Motion is available for free at: http://bankrupt.com/misc/CMC_Heartland_679_Sales.pdf The Chapter 11 cases are In re CMC Heartland Partners, et al. (Bankr. N.D. Ill. Lead Case No. 06-04759). The Honorable Deborah L. Thorne oversees the case. LePetomane XVIII,Inc., is the liquidating trustee for the bankruptcy estate of CMC Heartland. Fox Rothschild LLP is the Debtor's counsel. CORINTHIAN COLLEGES: Carr, Colon Suit vs E. Devos, et al., Tossed ----------------------------------------------------------------- District Judge Katherine Polk Failla granted Defendant Elizabeth DeVos's motion to dismiss the case captioned TINA CARR and YVETTE COLON, Plaintiffs, v. ELIZABETH DEVOS, in her official capacity as SECRETARY OF THE U.S. DEPARTMENT EDUCATION, NAVIENT CORPORATION, NAVIENT SOLUTIONS, LLC, NAVIENT CREDIT FINANCE CORPORATION, and JOHN DOE TRUSTS 1-4, Defendants, No. 17 Civ. 8790 (KPF) (S.D.N.Y.). Plaintiffs Tina Carr and Yvette Colon took out significant student loans in order to attend the Sanford-Brown Institute, a for-profit educational institution that, it is alleged, misrepresented the job opportunities that SBI students could achieve. After completing their respective courses of study, each Plaintiff found her SBI education to be effectively worthless. In consequence, each Plaintiff sought to invoke the "borrower defense," pursuant to which students who rely on the misrepresentations of an educational institution with respect to its accreditation or graduate employment rates may be relieved of their debts or have a defense to any collection attempts. The United States Department of Education has recognized the borrower defense in certain circumstances; Plaintiffs applied to DOE for such relief in late 2015, but DOE has not yet resolved their applications. Plaintiffs ask the Court for the resolution they have not yet obtained from DOE: They seek a declaratory judgment that they are entitled to a borrower defense for their outstanding student loans. DOE objects on the grounds that (i) the Secretary of Education is immune from suit; (ii) the specific loans that Plaintiffs received do not trigger a private right of action against the Secretary; and (iii) administrative remedies have not been exhausted. The Court agrees that the Secretary is immune from suit, thereby depriving the Court of subject matter jurisdiction. Even if the Court had subject matter jurisdiction, Plaintiffs have not adequately stated a claim for relief against the Secretary. The Court declines to reach the issue of exhaustion, as it does not consider it appropriate to undertake this unbounded inquiry in an advisory capacity. While the Court sympathizes with Plaintiffs' frustration over the lengthy delays in the processing of their applications, it cannot find that this bureaucratic lag gives rise to a viable claim for relief at this stage. A copy of the Court's Opinion and Order dated Feb. 25, 2019 is available at https://bit.ly/2VWcCgx from Leagle.com. Yvette Colon, Plaintiff, represented by Danielle Feldman Tarantolo, New York Legal Assistance Group, Jane Greengold Stevens, New York Legal Assistance Group, Jessica Grace Ranucci, New York Legal Assistance Group, Shanna Marie Tallarico, New York Legal Assistance Group, Toby Rachel Merrill, Legal Services Center of Harvard Law School, Victoria Fay Roytenberg, Legal Services Center of Harvard Law School & Eileen Mathews Connor, Legal Services Center of Harvard Law School. Navient Corporation, NAVIENT SOLUTIONS, LLC & Navient Credit Finance Corporation, Defendants, represented by Ashley Bryne Huddleston -- ahuddleston@vedderprice.com -- Vedder Price P.C. & Lisa M. Simonetti, Stroock & Stroock & Lavan, LLP. About Corinthian Colleges Corinthian Colleges, Inc., et al., were founded in February 1995 and through acquisitions became one of the largest for-profit post-secondary education companies in the U.S. and Canada. In January 2010, Corinthian purchased Heald Capital LLC, which operated Heald College, a 150 year-old regionally-accredited institution with 12 campuses. Corinthian Colleges, Pegasus Education, Inc., and 23 affiliated entities filed voluntary Chapter 11 petitions (Bankr. D. Del. Lead Case No. 15-10952) on May 4, 2015, to complete an orderly wind down of operations. The cases are jointly administered under Case No. 15-10952. Judge Kevin J. Carey presides over the case. Corinthian Colleges, Inc., disclosed $721,596,789 in assets and $2,929,448,278 in liabilities as of the Chapter 11 filing. The Debtors tapped Richards, Layton & Finger, P.A., as counsel; FTI Consulting, Inc., as restructuring advisors; PricewaterhouseCoopers, LLC, as tax advisors; and Rust Consulting/Omni Bankruptcy as claims and noticing agent. The U.S. Trustee for Region 3 formed an Official Committee of Unsecured Creditors and an Official Committee of Student Creditors. The Creditors Committee retained Brown Rudnick LLP and Rosner Law Group as attorneys. The Student Committee tapped Robins Kaplan LLP and Poslinelli PC as attorneys. * * * The Debtors closed each of their campus locations effective as of April 27, 2015, and immediately began the process of liquidating their assets and winding down operations. The effective date of the Debtors' Third Amended and Modified Combined Disclosure Statement and Chapter 11 Plan of Liquidation was Sept. 21, 2015. COUNTRYSIDE PROPERTY: Hires Shraiberg Landau as Counsel ------------------------------------------------------- Countryside Property Maintenance, LLC, seeks authority from the U.S. Bankruptcy Court for the Southern District of Florida to employ Shraiberg Landau & Page, P.A., as counsel to the Debtor. Countryside Property requires Shraiberg Landau to: a. advise the Debtor generally regarding matters of bankruptcy law in connection with this case; b. advise the Debtor of the requirements of the Bankruptcy Code, the Federal Rules of Bankruptcy Procedure, applicable bankruptcy rules, including local rules, pertaining to the administration of the case and U.S. Trustee Guidelines related to the daily operation of its business and administration of the estate; c. represent the Debtor in all proceedings before this Court; d. prepare and review motions, pleadings, orders, applications, adversary proceedings, and other legal documents arising in the case; e. negotiate with creditors, prepare and seek confirmation of a plan of reorganization and related documents, and assist the Debtor with implementation of any plan; and f. perform all other legal services for the Debtor, which may be necessary herein. Shraiberg Landau will be paid at these hourly rates: Attorneys $225 to $550 Paralegals $175 Shraiberg Landau holds a prepetition claim of $55,000 against the Debtor for unpaid legal fees. The firm is agreeing to voluntarily waive this claim. Shraiberg Landau will also be reimbursed for reasonable out-of-pocket expenses incurred. Bradley S. Shraiberg, a partner of Shraiberg Landau, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Shraiberg Landau can be reached at: Bradley S. Shraiberg, Esq. SHRAIBERG, LANDAU & PAGE, P.A. 2385 NW Executive Center Drive, #300 Boca Raton, FL 33431 Tel: (561) 443-0800 Fax: (561) 998-0047 E-mail: bss@slp.law About Countryside Property Maintenance Countryside Property Maintenance, LLC, is a commercial property maintenance company in Florida. The Company provides parking lot sweeping, pressure cleaning, and porter services. Countryside Property Maintenance, based in Miami, FL, filed a Chapter 11 petition (Bankr. S.D. Fla. Case No. 19-15633) on April 29, 2019. In the petition signed by Larry Healy, manager, the Debtor estimated $1 million to $10 million in both assets and liabilities. The Hon. Robert A. Mark oversees the case. Bradley S. Shraiberg, Esq., at Shraiberg Landau & Page, P.A., serves as bankruptcy counsel. CRESCENT ASSOCIATES: Shilkraut Buying L.A. Property for $1.8M ------------------------------------------------------------- Crescent Associates, LLC, asks the U.S. Bankruptcy Court for the Central District of California to authorize the short sale of the real property located at 3548 N Multiview DR, Los Angeles, California to Alex Shilkraut for $1.85 million, subject to overbid. Crescent owns the Property, a single family residence. Pursuant to the Property's preliminary title report obtained for the Sale, it is encumbered by the following deeds of trust: 1. A deed of trust recorded on Aug. 12, 2012 with the face amount of $875,000 to Miramar Financial Group, Inc. as the beneficiary is in first position on the Prelim. It has since been assigned to Riley Investors, LLC (recorded March 30, 2018) which is the current holder of the First Trust Deed. The amount due on the First Trust Deed as of April 30, will be $1,177,319 -- interest will continue to accrue at the rate off $389 per day thereafter. Edward Friedman is also the manager of Riley Investors, LLC. 2. The next liens are the two deeds of trust , Dror liens, that were recorded on Sept. 8, 2014, and which have been ruled to be invalid by the Court. No amount is due on these liens. 3. The next priority lien is a Trust Deed in the face amount of $900,000 that was recorded on Dec. 8, 2014 and which is now the second trust deed. The Second Trust Deed has been assigned to Samuel Hart. This debt is also secured by a first deed of trust on the Debtor's other property (35481/2 N. Multiview Dr). Mr. Hart has agreed to submit a $0 payoff demand into this escrow in exchange for a reconveyance for the Property and rely on his trust deed on 35482 N. Multiview Dr. to secure this lien. 4. The next priority lien is a Third Trust Deed in the face amount of $350,000 that was recorded on Oct. 23, 2015 in favor of Samuel Hart as the beneficiary. The loan was subsequently increased to the amount of $770,000. The amount due on the Third Trust Deed as of April 30, 2019 will be $723,637 and interest will continue to accrue at the rate of $243 per day thereafter. As set forth in the declaration of Samuel Hart, he has agreed to accept whatever amount ofproceeds that is available after the sale expenses, the First Trust Deed and the Admin Carveout have been paid in exchange for a reconveyance on the Property. Any amount remaining unpaid will be treated as an unsecured claim. 5. The next priority lien is a Fourth Trust Deed in the amount of $260,000 that was recorded on Aug. 29, 2016 in favor of Samuel Hart as the beneficiary. This debt is also secured by a deed of trust on the Debtor's other property (35481/2 N. 24 Multiview Dr) and as set forth in Hart Dec, Mr. Hart has agreed to submit a $0 payoff demand into this escrow in exchange for a reconveyance for the Property and rely on his deed of trust on 3548/: N. Multiview Dr. and other security to secure the debt. 6. The next priority lien belonged to the Debtor and was extinguished when it foreclosed on the Property and took title. It is anticipated that the First Trust Deed will be paid off leaving approximately $557,622 to be paid on the Third Trust Deed which will then retain an unsecured claim of approximately $166,015. The Debtor conditionally entered into a Contract of Sale of the Property with the Buyer for the amount of $1.85 million, with a closing date subsequent to the entry of an order approving the sale. The sale will be free and clear of all liens, claims, interests and encumbrances. The sale is subject to higher and better bids. A motion on the Sales Procedures was heard on April 11, 2019 and approved. The sale is an apparent short sale transaction. The estimated tax consequences to the estate are not fully determined at this time, however, the Debtor does not anticipate any tax liability. If any such tax liability exists, such tax liability will be attributed as ordered by the Court at the Sale hearing. Although the proposed sale appears to be a short sale transaction, the liens are actually less than set forth in the preliminary title report. The Property was developed in conjunction with the property adjacent to it, 35481/2 N. Multiview Dr, Los Angeles, CA 90068 and many of the liens are cross-collateralized between both properties. Additionally, in or about April 2019, the Court granted Debtor's Motion for Partial Summary Judgment ("MSJ") in the Debtor's adversary proceeding against Eyal Ben Dror and his two recorded liens have been invalidated and will be stricken from the record once the order on the MSJ has been entered by the Court. The Debtor has control of and/or has reached agreements with all ofthe other lien holders and has been authorized to complete the sale as set forth such that there will not been any objections from the remaining lien holders. All contingencies set forth in the Sale Agreement have expired, been satisfied, and/or waived. The Purchaser has performed and paid for inspections of 3548 Multiview and has incurred other expenses performing his due diligence regarding the purchase in the amount of approximately $4,500. The Debtor proposes that the proposed sale be subject to overbid after payment of a breakup fee to pay the current buyer in the amount of $4,500. The proposed breakup fee should enhance the sale price since it demonstrates that the Proposed Buyer is serious and has performed his due diligence to establish that the Property is in sound condition. The initial bid must also be in the additional amount of, at least $10,000. Any subsequent bids must be, at least, $5,000. The commissions to the broker total of $92,500. Pursuant to the Order of Court entered on March 14, 2019, the commission to the listing broker, Shawn Kormondy of Keller Williams, is $46,500 and the commission to the selling broker, Kristian Gray of Keller Williams is $46,500. In addition, there are property taxes of approximately $22,484 (after proration); miscellaneous fees of $620; owner's title insurance in an approximate sum of $3,306; documentary transfer taxes and recordation fees of $10,360; Escrow fees of $2,350; a home warranty plan of approximately $1,000; and an administrative carveout for United States Trustee's Fees of approximately $18,500 and other anticipated administrative costs in a sum of $39,000 (to be paid to the trust account of the Law Offices of Robert M. Yaspan). It is estimated that the proceeds that will be remaining are in the approximate sum of $1,647,000 which will be paid to the secured deeds of trust on the Property. Finally, the Debtor asks the Court to waive 14-day stay of order under Federal Bankruptcy Rule of Procedure 6004(h). A hearing on the Motion is set for May 9, 2019 at 10:00 a.m. A copy of the Contract attached to the Motion is available for free at: http://bankrupt.com/misc/Crescent_Associates_82_Sales.pdf The Purchaser: Alex Shilkraut 8665 Burton Way, #416 Los Angeles, CA 90048 About Crescent Associates Crescent Associates, LLC, based in Los Angeles, California, filed a Chapter 11 petition (Bankr. C.D. Cal., Case No. 18-20654) on Sept. 12, 2018. The Hon. Julia W. Brand oversees the case. In the petition signed by Edward Friedman, managing member, the Debtor disclosed $4,350,100 in assets and $5,214,026 in liabilities. Robert M. Yaspan, Esq., at the Law Offices of Robert M. Yaspan, serves as bankruptcy counsel to the Debtor. Turner Friedman Morris & Cohan, LLP, is special counsel. CYTODYN INC: Signs Warrants Exercise Agreements ----------------------------------------------- Cytodyn Inc. had entered into warrant exercise agreements with five substantial holders of outstanding warrants to purchase an aggregate of 7,541,279 shares of the Company's common stock, par value $0.001 per share. The Warrants had exercise prices ranging from $0.30 to $1.35 per share and were issued in various financing transactions between July 10, 2015 and Jan. 8, 2019, expiring five years from their respective dates of issuance. Pursuant to the Exercise Agreements, as an inducement to exercise the Warrants immediately for cash, the Company agreed to reduce the applicable exercise price to the lower of (i) the current exercise price and (ii) $0.40. In addition, the Company agreed to issue an additional one-half share of Common Stock for every share of Common Stock underlying the Warrants. In the aggregate, 11,311,917 shares of Common Stock, including the Additional Shares, will be issued in these transactions for aggregate gross proceeds to the Company of approximately $3.0 million. Final settlements are expected to occur on or before May 10, 2019. 2,733,333 of the shares of Common Stock issuable upon exercise of the Warrants will be sold pursuant to the Company's Registration Statement on Form S-3 (File No. 333-223195), declared effective on March 7, 2018, including the prospectus supplement dated March 7, 2018. The remaining 8,578,584 shares issuable upon exercise of the Warrants, as well as all of the Additional Shares, will be sold to accredited investors in reliance upon the exemption provided by Rule 506 of Regulation D and Section 4(a)(2) of the Securities Act of 1933, as amended. Pursuant to the Exercise Agreements, all shares are subject to contractual lock up restrictions for a six-month period following the closing of these transactions. In connection with the foregoing transactions, Dr. David F. Welch entered into Exercise Agreements for Warrants beneficially owned by him, covering an aggregate of 1,651,281 shares of Common Stock and 825,640 Additional Shares. Additionally, Michael A. Klump entered into Exercise Agreements for Warrants beneficially owned by him, covering an aggregate of 3,625,000 shares of Common Stock and 1,812,499 Additional Shares. Dr. Welch and Mr. Klump are members of the Company's board of directors and participated on terms identical to those applicable to other investors. About CytoDyn Inc. Headquartered in Vancouver, Washington, CytoDyn Inc. -- http://www.cytodyn.com/-- is a clinical-stage biotechnology company focused on the clinical development and potential commercialization of humanized monoclonal antibodies to treat HIV infection. Its lead product candidate, PRO 140, belongs to a class of HIV therapies known as entry inhibitors that block HIV from entering into and infecting certain cells. The Company believes that monoclonal antibodies are a new emerging class of therapeutics for the treatment of HIV to address unmet medical needs in the area of HIV and other immunologic indications, such as Graft versus Host Disease and certain types of cancer. The Audit Opinion included in the Company's Annual Report on Form 10-K for the year ended May 31, 2018, contains an explanatory paragraph regarding the Company's ability to continue as a going concern. Warren Averett, LLC, in Birmingham, Alabama, the Company's auditor since 2007, stated that the Company incurred a net loss of $50,149,681 for the year ended May 31, 2018 and has an accumulated deficit of $173,139,396 through May 31, 2018, which raise substantial doubt about its ability to continue as a going concern. As of Feb. 28, 2019, CytoDyn had $20.42 million in total assets, $26.67 million in total liabilities, and a total stockholders' deficit of $6.24 million. CYTOSORBENTS CORP: Incurs $4.88 Million Net Loss in First Quarter ----------------------------------------------------------------- Cytosorbents Corporation has filed with the U.S. Securities and Exchange Commission its quarterly report on Form 10-Q reporting a net loss of $4.88 million on $5.19 million of total revenue for the three months ended March 31, 2019, compared to a net loss of $2.98 million on $4.92 million of total revenue for the three months ended March 31, 2019. As of March 31, 2019, Cytosorbents had $30.99 million in total assets, $15.97 million in total liabilities, and $15.01 million in total stockholders' equity. Since inception, the Company's operations have been primarily financed through the issuance of debt and equity securities. At March 31, 2019, the Company had current assets of approximately $24,828,000 including cash on hand of approximately $19,647,000 and current liabilities of approximately $6,711,000. Cytosorbents said, "We believe that we have sufficient cash to fund our operations into 2020. We will need to raise additional capital to support our ongoing operations in the future. In addition, we will need to raise additional funds to support clinical trials in the U.S. and in Europe." As of March 31, 2019, the Company had an accumulated deficit of approximately $174,408,000, which included net losses of approximately $4,884,000 for the three months ended March 31, 2019, and $2,982,000 for the three months ended March 31, 2018. In part due to these losses, its 2018 audited consolidated financial statements were prepared assuming the Company will continue as a going concern, and the auditors' report on the 2018 financial statements expressed substantial doubt about its ability to continue as a going concern. "Our losses have resulted principally from costs incurred in the research and development of our polymer technology, clinical studies and selling, general and administrative expenses. We intend to continue to conduct significant additional research, development, and clinical study activities which, together with expenses incurred for the establishment of manufacturing arrangements and a marketing and distribution presence, and other selling, general and administrative expenses, are expected to result in continuing operating losses for the foreseeable future. The amount of future losses and when, if ever, we will achieve profitability are uncertain. Our ability to achieve profitability will depend, among other things, on successfully completing the development of our technology and commercial products, obtaining additional requisite regulatory approvals in markets not covered by the CE mark and for potential label extensions of our current CE mark, establishing manufacturing and sales and marketing arrangements with third parties, and raising sufficient funds to finance our activities. No assurance can be given that our product development efforts will be successful, that our current CE mark will enable us to achieve profitability, that additional regulatory approvals in other countries will be obtained, that any of our products will be manufactured at a competitive cost and will be of acceptable quality, or that the we will be able to achieve profitability or that profitability, if achieved, can be sustained. These interim consolidated financial statements do not include any adjustments related to the outcome of this uncertainty," the Company said in the SEC filing. A full-text copy of the Form 10-Q is available for free at: https://is.gd/OJxOHG About CytoSorbents Based in Monmouth Junction, New Jersey, CytoSorbents Corporation is engaged in critical care immunotherapy, specializing in blood purification. Its flagship product, CytoSorb is approved in the European Union with distribution in 55 countries around the world, as an extracorporeal cytokine adsorber designed to reduce the "cytokine storm" or "cytokine release syndrome" that could otherwise cause massive inflammation, organ failure and death in common critical illnesses. These are conditions where the risk of death is extremely high, yet no effective treatments exist. Cytosorbents reported a net loss of $17.21 million for the year ended Dec. 31, 2018, compared to a net loss of $8.46 million for the year ended Dec. 31, 2017. As of Dec. 31, 2018, the Company had $32.74 million in total assets, $15.81 million in total liabilities, and $16.93 million in total stockholders' equity. WithumSmith+Brown, PC, in East Brunswick, New Jersey, the Company's auditor since 2004, issued a "going concern" qualification in its report on the Company's consolidated financial statements for the year ended Dec. 31, 2018, noting that the Company sustained net losses for the years ended Dec. 31, 2018, 2017 and 2016. Further, the Company believes it will have to raise additional capital to fund its planned operations for the twelve month period through March 2020. These matters raise substantial doubt regarding the Company's ability to continue as a going concern. CYTOSORBENTS CORP: Reports First Quarter 2019 Financial Results --------------------------------------------------------------- CytoSorbents Corporation issued a press release on May 7, 2019, announcing its financial results for the quarter and three months ended March 31, 2019. First Quarter 2019 Financial Results: * Total revenue for Q1 2019 was $5.2 million, including both product sales and grant income, compared to $4.9 million in Q1 2018 * Product sales for Q1 2019 were $4.6 million, compared to $4.4 million for Q1 2018. Adjusted first quarter 2019 product sales would have been approximately $4.9 million, after reflecting changes in the Euro to dollar exchange rate between periods * Direct sales continue to expand and achieved new highs, reflecting 18% quarterly growth year-over-year, and 4% sequential growth compared to Q4 2018. Results do not yet materially reflect additions to the sales infrastructure, and new direct territories added in Q1 2019 * Distributor sales were affected by anticipated short-term issues from three distributors. As disclosed previously, Fresenius Medical Care is transitioning to new exclusive sales territories (e.g. Mexico, South Korea, Czech Republic) while maintaining France and Finland, and did not order in Q1 2019 as it sells through non-transferable European product inventory. Meanwhile, two other distributors temporarily paused from ordering to rebalance inventory, but have strong and growing end user demand for CytoSorb. The Company expects these issues to resolve before or during the second half of 2019 * Product gross margins for Q1 2019 and Q1 2018 were 74% * Cash position of $19.6 million at March 31, 2019 First Quarter 2019 Operational Highlights: * Exceeded 61,000 cumulative CytoSorb treatments delivered, an increase from 40,000 a year ago * Expanded partnership with Fresenius Medical Care to include an expansion of its exclusive distribution agreement to sell CytoSorb in Mexico, South Korea, and the Czech Republic, while maintaining France and Finland * Following a review of the first 50 patients, the independent Data Safety Monitoring Board (DSMB) and Scientific Advisory Board (SAB) recommended continuation of the German government-funded REMOVE endocarditis trial. The trial has now enrolled 180 patients, or nearly 75% of the targeted 250 patients, at 15 active sites * The REFRESH 2-AKI company-sponsored pivotal trial has increased enrollment to 79 patients at 23 clinical trial sites, and has attained approximately 20% of a targeted 400 patient enrollment * HemoDefend-RBC tooling delays have been resolved, parts have been manufactured, and clinical trial devices are being assembled. Meanwhile, an FDA investigational device exemption (IDE) submission is targeted for the second half of this year. A contract research organization (CRO) has been selected to manage the pivotal trial and has begun clinical site negotiations * Hosted the 6th International CytoSorb Users Meeting in Brussels, Belgium, in connection with the 39th International Symposium of Intensive Care and Emergency Medicine (ISICEM) Dr. Phillip Chan, chief executive officer of CytoSorbents Corporation stated, "Q2 2019 product sales are expected to return to our historical growth trajectory, and are anticipated to be the highest quarterly product sales reported in our history. In addition, we continue to forecast strong revenue growth for all of 2019, despite a slow start in Q1, based on numerous growth opportunities we see." Dr. Chan continued, "Specifically, we anticipate CytoSorb direct sales will continue strengthening and accelerate into the second half of this year, driven by organic growth, our investments in a larger direct sales team - particularly in Germany, reimbursement, contributions from new direct territories including Poland, Netherlands, and Scandinavia, new clinical data and applications, and other catalysts." "In addition, we believe the factors that impacted Q1 indirect sales are short-term and specific to the three distributors as described above. For example, Fresenius (FMC) is selling through its European inventory of CytoSorb in France and Finland, while it begins sales in the Czech Republic and pursues registration of CytoSorb in both Mexico and South Korea. It is expected that FMC will order new CytoSorb devices for these countries once registration is achieved. We are encouraged that each of these customers has increased their commitment to selling CytoSorb, including aggressively pursuing new indications, increasing resource allocation, and working closely with our company to drive success. Importantly, we see end-user demand increasing in their territories, based on the excellent foundation they have established. Over the next several quarters, we expect a resumption of ordering from all three groups. Of special note, we do not require these orders to achieve our guidance for Q2 2019." Dr. Chan concluded, "Lastly, we reiterate our guidance on expanding our blended product gross margins to 80% on a quarterly basis this year." The Company has experienced substantial operating losses since inception. As of March 31, 2019, the Company had an accumulated deficit of approximately $174,408,000, which included losses of approximately $4,884,000 and $2,982,000 for the three-month periods ended March 31, 2019 and 2018, respectively. Historically, losses have resulted principally from costs incurred in the research and development of its polymer technology, clinical studies, and general and administrative expenses. Since inception, the Company's operations have been primarily financed through the issuance of debt and equity securities. At March 31, 2019, the Company had current assets of approximately $24,828,000 including cash on hand of approximately $19,647,000, and current liabilities of approximately $6,711,000. The Company believes that it has sufficient cash to fund its operations into 2020. About CytoSorbents Based in Monmouth Junction, New Jersey, CytoSorbents Corporation is engaged in critical care immunotherapy, specializing in blood purification. Its flagship product, CytoSorb is approved in the European Union with distribution in 55 countries around the world, as an extracorporeal cytokine adsorber designed to reduce the "cytokine storm" or "cytokine release syndrome" that could otherwise cause massive inflammation, organ failure and death in common critical illnesses. These are conditions where the risk of death is extremely high, yet no effective treatments exist. Cytosorbents reported a net loss of $17.21 million for the year ended Dec. 31, 2018, compared to a net loss of $8.46 million for the year ended Dec. 31, 2017. As of March 31, 2019, Cytosorbents had $30.99 million in total assets, $15.97 million in total liabilities, and $15.01 million in total stockholders' equity. WithumSmith+Brown, PC, in East Brunswick, New Jersey, the Company's auditor since 2004, issued a "going concern" qualification in its report on the Company's consolidated financial statements for the year ended Dec. 31, 2018, noting that the Company sustained net losses for the years ended Dec. 31, 2018, 2017 and 2016. Further, the Company believes it will have to raise additional capital to fund its planned operations for the twelve month period through March 2020. These matters raise substantial doubt regarding the Company's ability to continue as a going concern. DAK CONSTRUCTION: Unsecureds to Get 5% in 20 Quarters ----------------------------------------------------- DAK Construction Corporation filed a Chapter 11 Plan and accompanying disclosure statement. Class 4 - All Allowed General Unsecured Claims. The Debtor will pay to holders of allowed general unsecured claims 5% of the amount of such allowed general unsecured claims in equal quarterly installments over the 5-year life of the plan (that is, 20 quarters), which, if not modified by agreement, shall commence under the Plan on the Effective Date and continuing at the end of the fiscal quarter following the Effective Date. This class is impaired. Class 5 - All General Unsecured Claims in an amount of $500 or less OR as to which its holder elects to receive $500 in full satisfaction thereof ("Convenience Class"). The Debtor will pay 100% of such claims on the First Distribution Date. This class is impaired. Class 6 - Debtor are impaired. All of the Debtor's property vests in Debtor upon confirmation. The Debtor shall receive its discharge upon completion of this Plan or as otherwise provided by law. Debtor has no unexempt equity in any property. It is projected that on the Effective Date, the Debtor will have approximately $65,000, but the amount available as of the Effective Date may be less than $65,000 by an amount equal to allowed administrative amounts paid before the Effective Date pursuant to Court order, which will reduce the amounts due on the Effective Date by a corresponding amount. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/y2dvpyx9 from PacerMonitor.com at no charge. Based in Woodland Hills, California, DAK Construction, Inc., filed a Chapter 11 Petition (Bankr. C.D. Calif. Case No. 18-12717) on November 6, 2018. The case is assigned to Hon. Martin R. Barash. The Debtor is represented by Giovanni Orantes, Esq., at The Orantes Law Firm, A.P.C., in Los Angeles, California. At the time of filing, the Debtor had estimated assets of $0 to $50,000 and estimated liabilities is $1 million to $10 million. The petition was signed by Cheryl Fay Lindhemer, CEO. DAVIS PROPERTIES: $2.3M Sale of Canby Property to Civignite Okayed ------------------------------------------------------------------ Judge Trish M. Brown of the U.S. Bankruptcy Court for the District of Oregon authorized Davis Properties, LLC's sale of the real property located at 461 NE 3rd Avenue in Canby, Oregon to Civignite, LLC for $2,275,000. The sale of the Property is approved free and clear of all liens, claims, and encumbrances with such interests attaching to the sale proceeds. Civignite will have no successor liability to any creditor who holds a claim as of the closing date except as specifically stated in the Purchase and Sale Agreement between Civignite and the Debtor, and all such creditors will be forever enjoined from seeking to enforce or collect any such claim from or against Civignite. All stays, including, without limitation, those arising under Bankruptcy Rule 6004 are inapplicable and the Order will go into effect immediately upon its entry. About Davis Properties Davis Properties, LLC, based in Canby, Oregon, filed a Chapter 11 petition (Bankr. D. Ore. Case No. 18-34413) on Dec. 19, 2018. In the petition signed by John Davis, manager, the Debtor estimated $1 million to $10 million in both assets and liabilities. The Hon. Trish M. Brown oversees the case. Albert N. Kennedy, Esq., at Tonkon Torp LLP, serves as bankruptcy counsel. DEBORAH SANZARO: Wins Disability Discrimination Suit vs HOA, et al. ------------------------------------------------------------------- District Judge Richard F. Boulware, II rules in favor of Plaintiffs in the case captioned DEBORAH SANZARO and MICHAEL SANZARO, Plaintiffs, v. ARDIENTE HOMEOWNERS ASSOCIATION, LLC et al., Defendants, Case No. 2:11-cv-01143-RFB-CWH (D. Nev.). Plaintiffs are homeowners and members of the Ardiente Homeowners Association ("HOA"). This case involves three incidents between 2009 and 2011, during which Mrs. Sanzaro, alone or accompanied by Mr. Sanzaro, attempted to enter the Ardiente HOA clubhouse with Mrs. Sanzaro's alleged service animal, a Chihuahua named Angel. On each of these three occasions, Mrs. Sanzaro was denied access to the clubhouse while accompanied by Angel. The Court held a bench trial in this case on April 9, 2018, April 10, 2018, April 16, 2018, April 17, 2018, April 18, 2018, April 20, 2018, and May 11, 2018. Plaintiffs brought 102 causes of action for "discrimination against the disabled, breach of contract and other torts," including claims under the Americans with Disabilities Act ("ADA"), and the Fair Housing Act ("FHA"). On Nov. 29, 2017 the Court entered an order on various motions, including a motion for summary judgment filed by Plaintiffs, which the Court denied. The remaining causes of action were Claims 1, 2, 6, 7, 11, and 12 which relate to the three incidents that took place on March 11, 2009 ("Incident 1"), July 26, 2010 ("Incident 2"), and January 29, 2011 ("Incident 3"). Based on these causes of action and the prior rulings of the Court, the issues remaining for trial were: (1) whether the HOA clubhouse was a place of public accommodation under the ADA and NRS section 651.075, and (2) whether Plaintiffs requested, and were ultimately refused, a reasonable accommodation under the FHA. All Defendants concede that Mrs. Sanzaro is a disabled individual and has had a disability at all relevant times during the events described above. Therefore, in consideration of the facts presented at trial, the Court finds that Mrs. Sanzaro is disabled as a matter of law. The Court also finds that she provided sufficient documentation about her disability to all Defendants. HOA Defendant Ardiente and business entity Defendants Corona and RMI were aware of Mrs. Sanzaro's disability at least as of July 27, 2009, the date of the NRED arbitration. The Court finds that all Defendants knew and could reasonably have been expected to know of Mrs. Sanzaro's handicap. They knew that her handicap requires the use of a walker, and Defendants do not dispute that her impairment was a visible one. Ardiente, through the Board members involved in the Incidents as well as correspondence from the Sanzaros, knew that Mrs. Sanzaro had a permanent handicap. Corona, as Declarant, had members on the Board during the three Incidents, and also knew of Mrs. Sanzaro's handicap. RMI, as employer of the Community Manager, knew of Mrs. Sanzaro's handicap through its representation at the NRED arbitration and being named as a party in the Sanzaros' agency actions. Phelps was present at the NRED arbitration, and testified at trial that she knew that Mrs. Sanzaro had a handicap which significantly impaired her mobility. The Court therefore finds that by the July 27, 2009 arbitration these Defendants knew Ms. Sanzaro was disabled and that Angel assisted her with her disability when she had acute pain attacks. The Court also finds that they did not have any information that disputed this. The Court also finds that Mrs. Sanzaro was unable to use and enjoy the clubhouse without an accommodation related to her disability. The Court further finds that access to the clubhouse was necessary for the Sanzaros' enjoyment of their home or dwelling. Mrs. Sanzaro required an accommodation to realize her expectation to use and enjoy the Ardiente clubhouse. The Court will award to Plaintiffs: $350,000 in compensatory damages, and $285,000 in punitive damages. The Court also awards attorneys' fees to the extent available and costs of litigation to Plaintiffs. A copy of the Court's Order dated Feb. 25, 2019 is available at https://bit.ly/2JziOEK from Leagle.com. Deborah Sanzaro, Plaintiff, pro se. Michael Sanzaro, Plaintiff, pro se. Ardiente Homeowners Association LLC, Scott Harris, Corona Ardiente LLC, Ryan Smith, Laury Phelps, RMI Management, LLC & Kevin Wallace, Defendants, represented by Joseph P. Garin -- JGARIN@LIPSONNEILSON.COM -- Lipson Neilson P.C., Jason C. Gless , Wood, Smith, Henning & Berman & Kaleb D. Anderson -- KANDERSON@LIPSONNEILSON.COM -- Lipson Neilson PC. ENERGY GUARD: Proposes a June 17 Auction of All Membership Units ---------------------------------------------------------------- Energy Guard Midwest, LLC, asks the U.S. Bankruptcy Court for the District of Kansas to authorize the auction sale of all its membership units on June 17, 2019. Pursuant to its First Amended Chapter 11 Plan, the Debtor is to sell by auction to the highest bidder all membership units in the Reorganized Debtor. It asks that the Court approves the bid procedures for said auction. Any person or entity expressing an interest in bidding must submit its Bid by a bid deadline of May 17, 2019. Any such Bid must: (1) identify the bidder, including any party for whom it may be bidding with or on behalf of; (2) be accompanied by evidence satisfactory to the Debtor that the bidder is financially qualified to perform upon any bid it may submit; and (3) be submitted to counsel for Debtor no later than the Bid Deadline. Any Bid that meets the foregoing requirements will be considered a "Qualified Bid." The counsel for Debtor shall, as soon as practicable, evaluate the Qualified Bids and identify the Qualified Bid that is the highest qualified bid. If it determines that one or more Bids are Qualified Bids, the Debtor will conduct an auction of the Units in the Reorganized Debtor on June 17, 2019 at 12:00 p.m., at the law offices of its counsel, Mark J. Lazzo, 3500 N. Rock Road, Building 300, Suite B, Wichita, KS 67226. The auction will be conducted in accordance with these auction procedures: (1) the Qualified Bidders, or their duly authorized representative, will appear in person or by phone at the auction; (2) only Qualified Bidders will be entitled to bid at the auction; (3) bidding at the auction will begin at the Starting Bid; (4) subsequent bids at the Auction will be made in minimum increments of $200, or as otherwise agreed by the Bidders; (5) no credit bids will be allowed. Upon conclusion of auction (if an auction is conducted), the Debtor will identify the highest bid. The Qualified Bidder having submitted the Successful Bid will be deemed the Successful Purchaser. From the proceeds of the auction sale, the Debtors will pay out the sale proceeds per the Confirmed Plan, which requires the proceeds be paid in descending order to the following: (i) priority administrative claims; (ii) Class 1 and 5 priority claims; and (iii) Class 7 general unsecured claims. Objections, if any, should be filed and served by May 1, 2019. If an objection is timely filed, a hearing on said objection will be scheduled for June 13, 2019 at 10:30 a.m. About Energy Guard Midwest Energy Guard Midwest, LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Kan. Case No. 18-11070) on June 4, 2018. At the time of the filing, the Debtor estimated assets of less than $50,000 and liabilities of less than $1 million. Judge Dale L. Somers presides over the case. Mark J. Lazzo, Esq., at Landmark Office Park, is the Debtor's legal counsel. The Office of the U.S. Trustee on Aug. 27, 2018, appointed the official committee of unsecured creditors in the Chapter 11 case. The Committee retained Eron Law, P.A., as counsel. The Debtor's First Amended Chapter 11 Plan dated Jan. 14, 2019, was confirmed on April 3, 2019. EP ENERGY: Incurs $140 Million Net Loss in First Quarter -------------------------------------------------------- EP Energy LLC filed its quarterly report on Form 10-Q with the U.S. Securities and Exchange Commission on May 9, 2019, disclosing a net loss of $140 million on $134 million of total operating revenues for the three months ended March 31, 2019, compared to net income of $18 million on $286 million of total operating revenues for the three months ended March 31, 2018. As of March 31, 2019, the Company had $4.10 billion in total assets, $403 million in total current liabilities, $4.43 billion in total non-current liabilities, and a total member's deficit of $736 million. The Company ended the quarter with $10 million in cash, $180 million borrowings outstanding on the RBL Facility, and $19 million in letters of credit, resulting in $440 million of available liquidity and $4.5 billion of net debt. The Company repurchased $50 million in principal amount of its unsecured notes at a discount in the quarter. In April 2019, the banks reaffirmed the current RBL Facility borrowing base of $1.36 billion and commitments of $629 million. Additional 1Q'19 Results: * Equivalent production of 73.2 MBoe/d * Oil production of 39.4 MBbls/d * Adjusted EBITDAX of $148 million * Oil and gas expenditures of $154 million, including $4 million acquisition capital * Adjusted oil and gas expenditures of $150 million * Completed two horizontal wells in Northeastern Utah (NEU) * Completed (based on wells fracture stimulated or frac’d) 17 gross wells (10 net) * Increased Drilled but Uncompleted (DUC) wells to 46 * Lease operating expense of $5.55 per Boe * G&A expense of $3.16 per Boe, Adjusted G&A expense of $2.50 per Boe * Reaffirmed the RBL Facility borrowing base in April 2019 and ended the first quarter with $440 million of liquidity, including $10 million of cash Operations Update For the first quarter 2019, average daily production was 73.2 MBoe/d, including 39.4 MBbls/d of oil. During the first quarter 2019, the company completed (frac'd) 17 gross wells (10 net) and incurred capital expenditures of $150 million, excluding acquisitions. The Company had lower production in the first quarter 2019 compared to the first quarter 2018 due to lower net completions during the first quarter 2019 and fourth quarter 2018. Northeastern Utah (NEU) In the first quarter 2019, the Company's assets in NEU produced 15.5 MBoe/d, including 10.0 MBbls/d of oil, a 10% and 14% decrease, respectively, from the first quarter 2018. EP Energy operated one drilling rig and completed (frac'd) four gross (one net) wells, of which two were vertical and two were horizontal, in the first quarter 2019. Total capital invested in NEU in the first quarter 2019 was $25 million excluding acquisition capital. In the second quarter 2019, the Company expects to average one drilling rig and complete and bring online three gross (three net) horizontal wells in late June in NEU. Eagle Ford EP Energy's assets in Eagle Ford produced 33.0 MBoe/d, including 22.2 MBbls/d of oil in the first quarter 2019, both an 8% decrease from the first quarter 2018. EP Energy averaged approximately three drilling rigs, invested $125 million excluding acquisition capital and completed (frac'd) 13 gross (nine net) wells in the first quarter 2019. The majority of these wells came online in March. The Company expects to average three drilling rigs and complete 13 gross wells (10 net) over the second quarter 2019, focusing on development in the southern and eastern portion of the La Salle acreage. Permian EP Energy's assets in the Permian basin produced 24.7 MBoe/d, including 7.2 MBbls/d of oil in the first quarter 2019, a 9% and 27% decrease, respectively, from the first quarter 2018. In the first quarter 2019, the company did not drill or complete any wells in the basin. A full-text copy of the Form 10-Q is available for free at: https://is.gd/qX43iZ About EP Energy LLC EP Energy LLC, a wholly-owned subsidiary of EP Energy Corporation -- http://www.epenergy.com/-- is an independent exploration and production company engaged in the acquisition and development of unconventional onshore oil and natural gas properties in the United States. The Company operates through a diverse base of producing assets and are focused on providing returns through the development of its drilling inventory located in three areas: the Permian basin in West Texas, the Eagle Ford Shale in South Texas, and the Altamont Field in the Uinta basin in Northeastern Utah. The Company is headquartered in Houston, Texas. * * * In April 2019, S&P Global Ratings lowered its issuer credit rating on exploration and production company EP Energy LLC to 'CCC-' from 'CCC+'. The downgrade follows heightened concerns surrounding EP Energy's liquidity as the Company's 10-K included language questioning its ability to address $182 million in senior unsecured notes maturing May 2020 while maintaining ongoing operations and maintenance capital expenditures. Also in April, 2019, Moody's Investors Service downgraded the ratings of EP Energy LLC's (EPE) Corporate Family Rating to Caa3 from Caa1. The downgrade of EP Energy's CFR to Caa3 reflects its weak liquidity, need to repay $182 million of notes maturing in May 2020 and potential for continued negative free cash flow in 2019, if production volumes remain flat. EPICENTER PARTNERS: Ct. Junks LKY Bid for Withdrawal of Reference ----------------------------------------------------------------- In the case captioned ROI Properties LLC, Plaintiff, v. Gray Phoenix Desert Ridge I LLC, Gray Phoenix Desert Ridge III LLC, Gray Phoenix Desert Ridge IV LLC, LKY Real Estate Fund V LLC, Bruce Gray, Barbara Gray, and Unknown Parties, Defendants, No. CV-18-02421-PHX-SMB (D. Ariz.), District Judge Susan M. Brnovich denied Defendant LKY Real Estate Fund V, LLC's Motion for Immediate Withdrawal of Reference of Adversary Proceeding from the bankruptcy court. On May 15, 2018, R.O.I Properties, LLC, as Liquidating Trustee of the May Liquidating Trust and trustee of the estates of Epicenter Partners, L.L.C. and Gray Meyer Fannin, L.L.C., brought adversary proceeding No. 2:18-ap-00209-MCW in the United States Bankruptcy Court for the District of Arizona against multiple defendants, including LKY Real Estate Fund V, LLC, who is not a creditor to the estates in the underlying bankruptcy cases. The Adversary Proceeding concerns the Complaint to avoid and recover fraudulent transfers and Arizona Law and to disallow claims. LKY points to multiple authorities to demonstrate that that withdrawal of the referral is necessary to avoid waiving constitutional rights. LKY relies on In re Carter, stating that the opinion in Carter is instructive in this matter LKY notes that Carter states that a "Stern objection may be waived any time the objector merely acquiesces in the Bankruptcy Court hearing any aspect of a case in a posture that may lead to a substantive ruling." In Carter, the court noted that in order to avoid situations in which a party first seeks a substantive ruling by a bankruptcy court, and then only if the ruling is unfavorable, asserts its Stern objection, the court must conclude that "a Stern objection is waived or forfeited whenever the party making it requests a substantive ruling from the Bankruptcy Court." Yet the court in Carter also stated that in order to avoid such a strategy by parties, it might "be necessary for courts to adopt a rule that the Stern objection is waived or forfeited unless the objector promptly moves for withdrawal of the reference and prosecutes that motion to conclusion in the District Court," noting that the Bellingham defendant failed to follow such procedure. Here, LKY has moved for withdrawal of the reference, which distinguishes this case from the scenario described in Carter. At this point, LKY has asserted that it does not consent to the Bankruptcy Court's final adjudication, and nothing at this point prevents LKY from renewing this objection. LKY has moved for withdrawal of the reference, as suggested by the court in Carter. And LKY has not "expressly consented to trial by the bankruptcy court," as did the party in Mastro. Accordingly, the Court does not find persuasive LKY's argument that withdrawal of the reference now is necessary to ensure there is no waiver of above discussed constitutional rights. At this time, the Court finds that the interests of efficiency are best served by allowing the Adversary Proceeding to remain in the Bankruptcy Court. While LKY also argues that withdrawal of the reference will have no impact on the uniformity of bankruptcy administration, and ROI makes no more than passing statements to the contrary, the Court finds that other factors weigh in favor of the Adversary Proceeding remaining with the Bankruptcy Court. A copy of the Court's Order dated Feb. 25, 2019 is available at https://bit.ly/2JF41IR from Leagle.com. ROI Properties LLC, Liquidating Trustee of the May Liquidating Trust and Trustee of the Estates of Epicenter Partners LLC and Gray Meyer Fannin LLC, Plaintiff, represented by Isaac Michael Gabriel -- isaac.gabriel@quarles.com -- Quarles & Brady LLP. Gray Phoenix Desert Ridge I LLC, Gray Phoenix Desert Ridge III LLC & Gray Phoenix Desert Ridge IV LLC, Defendants, represented by Brian John Jordan, Kutak Rock LLP, Daniel G. Dowd, Cohen Dowd Quigley PC, John Neil Stuart -- nstuart@CDQLaw.com -- Cohen Dowd Quigley PC & Kevin Christopher Moyer, Cohen Dowd Quigley PC. LKY Real Estate Fund V LLC, Defendant, represented by Christopher Reed Kaup, Tiffany & Bosco PA, Jack Robert Vrablik, Tiffany & Bosco PA & Mark S. Bosco, Tiffany & Bosco PA. Bruce Gray & Barbara Gray, Defendants, represented by Brian John Jordan, Kutak Rock LLP, Daniel G. Dowd, Cohen Dowd Quigley PC & John Neil Stuart, Cohen Dowd Quigley PC. About Epicenter Partners Epicenter Partners LLC was formed in 2004 to acquire, manage, sell or hold land for investment. Gray Meyer Fannin LLC came into existence in 2001 and was originally formed to provide development services for affiliates. Both are fully owned by Gray/Western Development Company and managed, pursuant to that entity, by Bruce Gray. The companies sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Lead Case No. 16-05493) on May 16, 2016. Epicenter disclosed $143,212,665 in assets and $66,913,279 in liabilities. Epicenter and GMF tapped Thomas J. Salerno, Esq., at Stinson Leonard Street, LLP, as their Chapter 11 counsel. Mesch Clark Rothschild was later hired as substitute counsel to Stinson Leonard Street. On June 15, 2016, the Office of the U.S. Trustee appointed five creditors of Epicenter and GMF to serve on the official committee of unsecured creditors. The committee is represented by Michael W. Carmel, Ltd., as counsel. On November 22, 2016, Sonoran Desert Land Investors LLC, East of Epicenter LLC, and Gray Phoenix Desert Ridge II LLC, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case Nos. 16-07659 to 16-07661). The cases are jointly administered with that of Epicenter. On Feb. 6, 2017, CPF Vaseo Associates LLC, a secured creditor, proposed a plan of reorganization for Epicenter, Gray Meyer, Sonoran, East of Epicenter, and Gray Phoenix. On Feb. 7, 2017, Sonoran, East of Epicenter and Gray Phoenix filed a plan of reorganization and disclosure statement proposing to pay their general unsecured creditors in full. The plan has been proposed for the three companies only. EYEPOINT PHARMACEUTICALS: Reports Q1 Net Loss of $19.2 Million -------------------------------------------------------------- EyePoint Pharmaceuticals, Inc. filed with the U.S. Securities and Exchange Commission on May 10, 2019, its quarterly report on Form 10-Q reporting a net loss of $19.23 million on $2.01 million of total revenues for the three months ended March 31, 2019, compared to a net loss of $6.97 million on $928,000 of total revenues for the three months ended March 31, 2018. Operating expenses for the three months ended March 31, 2019 increased to $16.7 million from $5.6 million in the prior year period, due primarily to investments in sales and marketing infrastructure and program costs, professional services, stock-based compensation and amortization of the DEXYCU intangible asset. Non-operating expense, net, for the three months ended March 31, 2019 totaled $4.6 million and consisted of $777,000 of net interest expense and $3.8M from the loss on extinguishment of debt related to the pay off of the SWK term loan. As of March 31, 2019, the Company had $81.85 million in total assets, $61.97 million in total liabilities, and $19.87 million in total stockholders' equity. Cash and cash equivalents at March 31, 2019 totaled $43.4 million compared to $45.3 million at Dec. 31, 2018. At April 30, 2019, the total amount outstanding under the CRG debt facility was $50 million and cash and cash equivalents as of that date were $56.9 million. The Company has a history of operating losses and has not had significant recurring cash inflows from revenue. The Company's operations have been financed primarily from sales of its equity securities, issuance of debt and a combination of royalty income and other fees received from collaboration partners. In February 2019, the Company refinanced its then existing $20.0 million term loan and made an initial draw of $35.0 million from a new term loan agreement with CRG Servicing LLC, resulting in incremental net proceeds of approximately $11.4 million. In addition to total cash and cash equivalents of $43.4 million at March 31, 2019, the Company received net proceeds of $18.6 million on April 1, 2019 from the issuance of common stock (excluding approximately $300,000 of additional unpaid share issue costs). During April 2019, the Company exercised its option to draw an additional $15.0 million under the CRG Loan Agreement and paid a $15.0 million development milestone that was due to the former Icon security holders following the first commercial sale of DEXYCU. At April 30, 2019, the Company had $56.9 million of cash and cash equivalents. During the three months ended March 31, 2019, the Company commenced the U.S. launch of its first two commercial products, YUTIQ and DEXYCU. Executing a phased launch approach specifically for DEXYCU, many early patients have been injected at the end of cataract surgery through the Company's non-revenue samples program that has facilitated physician training. Overall, early sales of these products have been encouraging, and the Company is optimistic that existing cash and cash equivalents at April 30, 2019 and cash inflows from anticipated YUTIQ and DEXYCU product sales will be sufficient to fund the Company's current and planned operations through to the generation of positive cash flow in 2020. "The initial launches of our two commercial ocular products, DEXYCU and YUTIQ, have generated a strong initial reception by treating physicians and patients, which we will look to leverage to drive sales growth in the coming quarters," said Nancy Lurker, president and chief executive officer of EyePoint Pharmaceuticals. "We are now a fully-integrated, commercial-stage specialty ophthalmology company and are very pleased with the early momentum we are seeing for our two new innovative ocular products, each of which have significant market potential. We are also optimistic that we are well-positioned financially to execute on our goals following the addition of a new credit facility in February with CRG and the recent equity offering that we completed in April to support our operations through to positive cash flow in 2020." A full-text copy of the Form 10-Q is available for free at: https://is.gd/l9EWlZ About EyePoint Pharmaceuticals EyePoint Pharmaceuticals, formerly pSivida Corp. -- http://www.eyepointpharma.com/-- headquartered in Watertown, MA, is a specialty biopharmaceutical company committed to developing and commercializing innovative ophthalmic products in indications with high unmet medical need to help improve the lives of patients with serious eye disorders. With the approval by the FDA on Oct. 12, 2018 of the YUTIQ three-year treatment of chronic non-infectious uveitis affecting the posterior segment of the eye (NIPU), the Company has developed the majority of the FDA-approved sustained-release treatments for eye diseases. The Company reported a net loss of $44.72 million for the six months ended Dec. 31, 2018. For the year ended June 30, 2018, the Company reported a net loss of $53.17 million, compared to a net loss of $18.48 million for the year ended June 30, 2017. As of Dec. 31, 2018, Eyepoint had $78.16 million in total assets, $40.53 million in total liabilities, and $37.63 million in total stockholders' equity. Deloitte & Touche LLP, in Boston, Massachusetts, the Company's auditor since 2008, issued a "going concern" opinion in its report on the consolidated financial statements for the year ended Dec. 31, 2018, citing that the Company's limited currently available cash, cash equivalents and available borrowings, together with its history of losses, and the uncertainty in timing of cash receipts from its newly launched products raise substantial doubt about the Company's ability to continue as a going concern. FOUR THE BOYS: Case Summary & 3 Unsecured Creditors --------------------------------------------------- Debtor: Four the Boys II, LLC 356 Bay Lane Mantoloking, NJ 08738 Business Description: Four the Boys II, LLC is a privately held company engaged in renting and leasing real estate properties. The Company is the fee simple owner of a property located at 356 Bay Lane Mantoloking, NJ 08738 valued by the Company at $1.28 million. Chapter 11 Petition Date: May 13, 2019 Court: United States Bankruptcy Court District of New Jersey (Trenton) Case No.: 19-19708 Judge: Hon. Christine M. Gravelle Debtor's Counsel: Eugene D. Roth, Esq. LAW OFFICE OF EUGENE D. ROTH Valley Pk. East 2520 Hwy 35, Suite 307 Manasquan, NJ 08736 Tel: (732) 292-9288 Fax: (732) 292-9303 E-mail: erothesq@gmail.com Total Assets: $1,305,000 Total Liabilities: $2,998,833 The petition was signed by James J. Hopkins, III, managing member. A full-text copy of the petition containing, among other items, a list of the Debtor's three unsecured creditors is available for free at: http://bankrupt.com/misc/njb19-19708.pdf GARLAND BARBECUE: Unsecureds to Get 50% Under Chapter 11 Plan ------------------------------------------------------------- Garland Barbecue #1, LLC, and Farmers Branch Barbecue, LLC, filed a Chapter 11 plan of reorganization and accompanying disclosure statement. Class 8 Claimants (Allowed Unsecured Creditors) are impaired and shall be satisfied as follows: All allowed unsecured creditors shall share pro rata in the unsecured creditors pool for each case. The unsecured creditors in each Debtor's case, shall include the Guaranty claim held by LiftForward in each case. Each Debtor shall make monthly payments commencing on the Effective Date of $1,000 into the unsecured creditors' pool. The Debtor shall make distributions to the Class 9 creditors every 90 days commencing 90 days after the Effective Date. The Debtor shall make a total of 60 payments into the unsecured creditors pool with the first payment being made on the Effective Date. Based upon the Proof of Claims filed in the cases, the Class 9 creditors in each case should receive approximately 50% of their Allowed Claims. The Debtor may prepay any Class 9 Claim at any time without penalty. The Debtors anticipate the continued operations of the business to fund the Plan. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/y2tlkmro from PacerMonitor.com at no charge. About Garland Barbecue #1 Garland Barbecue #1, LLC's business consists of the ownership and operation of a Dickie Barbecue restaurant in Garland, Texas. Garland Barbecue #1, LLC, doing business as Dickeys Barbecue Pit, filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 18-33510) on Oct. 30, 2018. In the petition signed by Jeff Bass, president, the Debtor estimated less than $500,000 in assets and liabilities. The Debtor is represented by Eric A. Liepins, Esq. of Eric A. Liepins, P.C. GRANT STREET: Trustee Selling Framingham Property for $2.6M ----------------------------------------------------------- Anne J. White, the Chapter 11 Trustee of The Grant Street, LLC, asks the U.S. Bankruptcy Court for the District of Massachusetts (a) to authorize its private sale of the real property located at 76-78 Grant Street, Framingham, Massachusetts, together with the buildings, fixtures and improvements thereon; and (b) to authorize it to assume, assign and sell a certain lease by and between the Debtor and Southern Middlesex Opportunity Council, to ViceRoy Capital Management, LLC for $2.575 million, cash, subject to higher and better offers. The Lease is (i) a 10-year lease that commenced on March 1, 2015, (ii) a master lease for the entire 12-unit building, (iii) a triple net lease which currently generates payments of $15,500, and (iv) all subject to further terms and conditions as set forth in detail in the lease. The Purchaser, 400 Trade Center, Suite 5900, Woburn, Massachusetts, no relationship or connection with the Debtor or other beneficial owners of the Property. The sale will take place by May 22, 2019. The has paid a deposit in the sum of $250,000. The Trustee will hold the Deposit in escrow pending the closing of the sale. The balance ofthe Purchase Price will be paid to the Trustee via bank check 0r wire transfer at the closing. The terms ofthe proposed sale are more particularly described in the Trustee's Motion To Sell which has been filed with the Court together with a written purchase and sale agreement which is appended to the Motion To Sell. The Motion To Sell, which includes a copy of the purchase and sale agreement, is available at no charge upon request from the Trustee. The Trustee proposes to sell the Real Property and assume and assign the Lease free and clear of all liens, claims, interests and encumbrances. To the extent any valid and unavoidable liens, claims, interests and encumbrances may exist, the Trustee proposes that they attach to the proceeds of the sale. The Real Property and Lease are to be sold "as is" and "where is" and without any warranties or representations of any kind or nature. A hearing on the Motion to Sell and any objections or higher offers is scheduled to place on May 17, 2019 at 10:00 a.m. The Objection Deadline is May 14, 2019. Through the Notice, higher offers for the Property are solicited. Any higher offer must be accompanied by a cash deposit of $250,000 paid to the Trustee made payable to Anne J. White, Chapter 11 Trustee. Any counteroffer must be in an amount not less than 5% more than the Net Purchase Price of $2,510,625 (i.e. $2.575 million less the 2.5% broker's commission of $64,375) such that the counteroffer must be in an amount not less than $2,636,156. Higher offers must be on the same terms and conditions provided in the Motion to Sell, other than the purchase price amount. With the exception of the purchase price, the terms of any counteroffer must be identical to the terms of sale of the original proposed Buyers. Any counter-bidders who are represented by buyer's brokers will also submit an Affidavit to the Court in accordance with Fed. R. Bankr. P. 2014 and MLBR Rule 2014-l at the same time as submitting their bid and set forth their request for a 2.5% commission upon consummation ofthe sale. Ifany such counter-bidder becomes the winning bidder and consummates the purchase ofthe Real Property in the case, then that buyer's broker will be entitled to a commission of 2.5% of the winning purchase price at the time of consummation ofthe sale. Any counteroffer should reflect a single purchase price which will be inclusive of both the Real Property and the SMOC Lease. About The Grant Street The Grant Street, LLC, based in Sudbury, MA, filed a Chapter 11 petition (Bankr. D. Mass. Case No. 18-42074) on Nov. 6, 2018. In the petition signed by David J. Howe, manager, the Debtor estimated $1 million to $10 million in both assets and liabilities. The Hon. Elizabeth D. Katz oversees the case. Daniel W. Murray, Esq., at The Law Offices of Daniel W. Murray, serves as the Debtor's bankruptcy counsel. GREGORY TE VELDE: Trustee Selling Cessna P210N Airplane for $75K ---------------------------------------------------------------- Randy Sugarman, the Chapter 11 Trustee for Gregory John te Velde, asks the U.S. Bankruptcy Court for the Eastern District of California to authorize the sale of a 1978 Cessna P210N airplane, Serial Number P2100076, to Michael Schoneau, doing business as Valley Air Crafts, for $75,000, all cash, "as is, where is," and subject to overbid. The Debtor is an individual who owned the aircraft. He scheduled the airplane as having a value of $180,000. The Trustee believes that the airplane is unencumbered and there is no public record to the contrary. The airplane is not necessary for the business operations of the Estate, and the Trustee has determined that it is in the best interests of the Estate to sell the airplane for cash to fund operations and pay unsecured creditors. On April 8, 2019, the Trustee entered into a Sales Agreement with the Buyer. After investigation of the market and consultation with various knowledgeable parties, the Trustee has determined that this is a fair purchase price given the deferred maintenance and poor documentation of the airplane. To ensure a favorable return for the Estate the Trustee proposes to offer the airplane for overbid at the hearing on the sale motion on the terms set forth in the accompanying notice of hearing. That is, any prospective bidder must prequalify by submitting a nonrefundable deposit of $5,000 to the Trustee by April 22, 2019 and agree to a minimum initial overbid of $80,000. Bidding, if any, will be held in open court at the hearing date in $1,000 increments. The balance of the purchase price will be due when the sale order becomes final. Pending the sale, the Trustee has advertised the airplane for sale with an online service. On the conclusion of the sale, the Trustee will file prepare and file a report and return of sale as is required by FRBP 6004(f)(1). The Trustee submits that it is a sound exercise of his business judgment to sell the airplane. A hearing on the Motion is set for April 24, 2019 at 1:30 p.m. About Gregory John te Velde Tipton, California-based Gregory John te Velde filed for Chapter 11 bankruptcy (Bankr. E.D. Cal. Case No. 18-11651) on April 26, 2018. In his Chapter 11 petition, the Debtor estimated both assets and liabilities between $100 million and $500 million. Mr. te Velde does business as GJ te Velde Dairy, Pacific Rim Dairy and Lost Valley Farm. He formerly did business as Willow Creek Dairy. Judge Fredrick E. Clement oversees the bankruptcy case. Mr. te Velde is represented by Riley C. Walter, Esq., who has an office in Fresno, California. GRIFFITH FARMS: Hires Russell Guthrie as Accountant --------------------------------------------------- Griffith Farms, JV, and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the Northern District of Texas to employ Russell Guthrie of Edie Bailly, LLP, as accountant to the Debtors. Griffith Farms requires Russell Guthrie to prepare on behalf of the Debtors and the estates all tax returns. Russell Guthrie will be paid based upon its normal and usual hourly billing rates. The firm will also be reimbursed for reasonable out-of-pocket expenses incurred. Russell Guthrie, a partner of Russell Guthrie of Edie Bailly, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Russell Guthrie can be reached at: Russell Guthrie RUSSELL GUTHRIE OF EDIE BAILLY, LLP 400 Pine Street Abilene, Texas 79601 Tel: (325) 672-4000 About Griffith Farms Griffith Farms, JV, is a privately held company in Hawley, Texas, that operates in the crop farming industry. Griffith Farms sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 19-10048) on March 15, 2019. At the time of the filing, the Debtor estimated assets of between $10 million and $50 million and liabilities of between $1 million and $10 million. The case is assigned to Judge Robert L. Jones. RUSSELL GUTHRIE OF EDIE BAILLY, LLP, is the Debtor's counsel. HAWAIIAN EBBTIDE: Hires Star Consulting as Counsel -------------------------------------------------- Hawaiian Ebbtide Hotel, Inc., seeks authority from the U.S. Bankruptcy Court for the District of Hawaii to employ Star Consulting LLC, as counsel to the Debtor. Hawaiian Ebbtide requires Star Consulting to represent and provide legal services to the Debtor in the Chapter 11 bankruptcy proceedings. Star Consulting will be paid at the hourly rate of $200. The firm will be paid a retainer in the amount of $1,000. Star Consulting will also be reimbursed for reasonable out-of-pocket expenses incurred. Christopher S.B. Woo, a partner of Star Consulting, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Star Consulting can be reached at: Christopher S.B. Woo, Esq. STAR CONSULTING LLC 159 Kai'ulani Avenue Honolulu, HI 96815 Tel: (808) 940-3244 E-mail: attorneychristopherwoo@gmail.com About Hawaiian Ebbtide Hotel Hawaiian Ebbtide Hotel, Inc., based in Honolulu, HI, filed a Chapter 11 petition (Bankr. D. Haw. Case No. 19-00227) on Feb. 25, 2019. In the petition signed by John D. Wollstein, president of Board of Directors, the Debtor estimated $1 million to $10 million in both assets and liabilities. The Hon. Robert J. Faris oversees the case. Christopher S.B. Woo, Esq., at Star Consulting LLC, serves as bankruptcy counsel to the Debtor. HERITAGE CONSOLIDATED: Texas Court Upholds Ruling Against ACME, EER ------------------------------------------------------------------- In the appeals cases captioned ACME ENERGY SERVICES, INC. d/b/a RIG MOVERS EXPRESS, Appellant, d/b/a BIG DOG DRILLING, Appellant v. SANDRA H. STALEY, INDIVIDUALLY AS INDEPENDENT EXECUTRIX OF THE ESTATE OF GEORGE G. STALEY, DECEASED, AND AS TRUSTEE OF THE TAX FREE TRUST FOR SANDRA H. STALEY, Appellee, No. 08-17-00145-CV, No. 08-17-00148-CV, ENDEAVOR ENERGY RESOURCES, L.P., Appellant, v. SANDRA H. STALEY, INDIVIDUALLY AS INDEPENDENT EXECUTRIX OF THE ESTATE OF GEORGE G. STALEY, DECEASED, AND AS TRUSTEE OF THE TAX FREE TRUST FOR SANDRA H. STALEY, Appellee, No. 08-17-00146-CV (Tex. App.) ACME Energy Services and Endeavor Energy appeal the judgment of the trial court holding its lien on an oil-and-gas lease had been extinguished by a prior agreement. The Texas Court of Appeals affirmed the trial court's decision. In Issues One, Two, and Three, ACME and Endeavor contend the trial court (1) erred by holding there is no debt owed to ACME and Endeavor for the Invoices; (2) erred in finding that no debt is owed on the Invoices; and (3) erred in finding the lien claimed by ACME and Endeavor had been extinguished. In Issues Four, Five, and ACME and Endeavor contend the trial court (4) erred in holding that because the lien had been extinguished, ACME and Endeavor could not prevail on its claims; (5) erred in holding it would not be equitable and just for the trial court to award ACME attorney's fees; and (6) erred in holding ACME and Endeavor are not entitled to recover attorney's fees. ACME and Endeavor contend the trial court erred in concluding the debts of the Invoiced Amounts were no longer owed because the underlying debt and lien were extinguished by the bankruptcy stipulation with Heritage Consolidated Services. This consolidated case is about an oil-and-gas contractor who went belly up and the subcontractors who are seeking to satisfy invoiced obligations not fully paid in the contractor's bankruptcy. Here, ACME and Endeavor assert the Stipulation only extinguished Heritage's personal liability to pay the debt but left the underlying debt of the Invoiced Amounts intact against the property. Citing Atkins, ACME and Endeavor contend the Stipulation did not contain express language releasing the lien or underlying indebtedness, and therefore the debts could not have been extinguished. Alternatively, ACME and Endeavor contend the language in paragraph seven specifically reserving their "claims and liens" against George Staley establishes that it was not the mutual intent of the parties to release the underlying debt. ACME and Endeavor also point to a line in the Stipulation reserving "the continuing indebtedness of the Stipulated Amount," to show the debt of the Invoiced Amounts was not intended to be extinguished. The Court holds that the language of the Stipulation expressly releases not only the underlying debt owed by Heritage but the lien against Heritage as well. The Stipulation states ACME’s "recovery"--Heritage's acknowledgment of the debt's validity, the priority status in bankruptcy of part of the Stipulated Amount, and the rest of the Stipulated Amount as an unsecured claim--would "be in full and final satisfaction of their putative claims and liens against any interests of Heritage and/or the Trust in [Section 6 leases and A.G. Hill No. 1 Well]. . . ." The Stipulation also stated each side released the other from all claims whatsoever "that arise out of or relate to the facts and circumstances made the basis of the Adversary Proceeding, or that were or could have been asserted in the Adversary Proceeding and/or the Proofs of Claim." This is the type of language we acknowledged in Atkins would demonstrate a mutual intent to discharge a debt by accord and satisfaction. While ACME and Endeavor contend the language reserving "claims and liens" held against Staley preserves the debt and lien, the only lien on record is against Heritage for the debt of the Invoiced Amounts, which was specifically reduced to the Stipulated Amount by the terms of the Stipulation. If Staley had received his interest in the well prior to the perfection of the mechanic's lien, and if the lien affidavit had been perfected as to both Heritage and Staley, then perhaps ACME and Endeavor could argue severance and have reserved a right to proceed separately against Staley's interest after settling with Heritage in bankruptcy court. Instead, the Stipulated Amount was given partial priority in the bankruptcy, thus ensuring payment by Heritage of at least some part of that amount, in exchange for "full and final satisfaction" of their claims and liens against Heritage. Thus, by its terms, the Stipulation was an accord and satisfaction because it was the mutual intent of the parties "that payment of the new amount will amount to full satisfaction of the existing claim." Accordingly, because ACME and Endeavor's debt was extinguished via the Stipulation, the trial court did not err in concluding ACME and Endeavor could not foreclose on its putative lien against Staley's interest. Issues One, Two, and Three are overruled. In Issues Four, Five, and Six, ACME and Endeavor contend the trial court erred by refusing to award it reasonable attorney's fees. The trial court concluded, "It would not be equitable and just for the Court to award attorneys' fees to Plaintiff when Plaintiff has failed to prevail on its claims." Section 53.156 of the Texas Property Code requires a court to award costs and attorney's fees in an action to foreclose a lien as it deems "are equitable and just." Awarding fees in an equitable and just way is a matter squarely within the trial court's discretion. Moreover, the statute by its terms makes the award of attorney's fees discretionary and not automatic, even to a prevailing party. Accordingly, the trial court did not err in denying ACME and Endeavor attorney's fees. ACME and Endeavor's fourth, fifth, and sixth issues are overruled. Having overruled Issues One through Six, the judgment of the trial court is affirmed. A copy of the Court's Opinion dated Feb. 22, 2019 is available at https://bit.ly/2JxWtHH from Leagle.com. Julie Griffis, John A. 'Jad' Davis, for Sandra H. Staley, Individually as Independent Executrix of the Estate of George G. Staley, Deceased, and as Trustee of the Tax-Free Trust for Sandra H. Staley, Appellee. Michael D. Jones, for Acme Energy Services, Inc. d/b/a Rig Movers Express, d/b/a Big Dog Drilling, Appellant. About Heritage Consolidated Heritage Consolidated LLC is a privately held company whose core operations consist of exploration for, and acquisition, production, and sale of, crude oil and natural gas. Heritage Consolidated filed a Chapter 11 petition (Bankr. N.D. Tex. Case No. 10-36484) on Sept. 14, 2010, in Dallas, Texas. Its affiliate, Heritage Standard Corporation, also filed for Chapter 11 protection (Bankr. N.D. Tex. Case No. 10-36485). The Debtors each estimated assets and debts of $10 million to $50 million. The Debtors tapped Malouf & Nockels LLP's as special counsel; Munsch Hardt Kopf & Harr, P.C.; Rochelle McCullough, LLP; HSC, RM LLP as special bankruptcy counsel to HSC; and Bridge Associates, LLC, as financial advisor and designate Scott Pinsonnault as interim chief restructuring officer. The U.S. Trustee for Region 6 formed an Official Committee of Unsecured Creditors in the Chapter 11 cases. The Committee is represented by Chamberlain, Hrdlicka, White, Williams & Aughtry, as counsel. The Bankruptcy Court confirmed the Debtors' second amended joint plan of reorganization on Aug. 26, 2013. HEXION HOLDINGS: Seeks to Hire Paul Weiss as Counsel ---------------------------------------------------- Hexion Holdings LLC, and its debtor-affiliates seek authority from the U.S. Bankruptcy Court for the District of Delaware to employ Paul Weiss Rifkind Wharton & Garrison LLP, as special financing and securities counsel to the Debtors. Hexion Holdings requires Paul Weiss to: a) advise and assist the Debtors with respect to the Debtors' debtor-in-possession financing; b) advise and assist the Debtors with respect to the Debtors' exit financing, and any other financing; c) advise and assist the Debtors with respect to the Debtors' general corporate issues, including compliance with federal securities law and related issues, including any potential securities listings, as well as tax matters; d) provide historical information about the Debtors' activities from 2005 through the Petition Date, to the extent such information is necessary for the completion of the Debtors' restructuring efforts in these cases or other matters; and e) perform the full range of services normally associated with the above matters. Paul Weiss will be paid at these hourly rates: Partners $1,165 to $1,560 Counsels $1,125 to $1,160 Associates $480 to $1,065 Paraprofessionals $110 to $365 In the year immediately preceding the Petition Date, Paul Weiss received the amount of $3,027,375. Prior to the Petition Date, Paul Weiss held the amount of $447,225 in its trust account. Paul Weiss will also be reimbursed for reasonable out-of-pocket expenses incurred. In accordance with Appendix B-Guidelines for Reviewing Applications for Compensation and Reimbursement of Expenses Filed under 11 U.S.C. Sec. 330 for Attorneys in Larger Chapter 11 Cases, the following is provided in response to the request for additional information: -- Paul Weiss has not agreed to a variation of its standard or customary billing arrangements for representing the Debtors during their chapter 11 cases. -- None of Paul Weiss' professionals included in this engagement have varied their rate based on the geographic location of these chapter 11 cases. -- Paul Weiss represented the Debtors since 2011 as their general outside counsel. Except as noted above, the billing rates and material financial terms in connection with such representation have not changed postpetition other than due to annual and customary firm-wide adjustments to Paul Weiss' hourly rates in the ordinary course of Paul Weiss' business. -- The Debtors and Paul Weiss expect to develop a prospective budget and staffing plan for Paul Weiss' engagement to reasonably comply with the U.S. Trustee's requests for information and additional disclosures. Consistent with the U.S. Trustee Guidelines, the budget may be amended as necessary to reflect changed or unanticipated developments. Jeffrey D. Saferstein, partner of Paul Weiss Rifkind Wharton & Garrison LLP _, assured the Court that the firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code and does not represent any interest adverse to the Debtor and its estates. Paul Weiss can be reached at: Jeffrey D. Saferstein, Esq. PAUL WEISS RIFKIND WHARTON & GARRISON LLP 1285 Avenue of the Americas New York, NY 10019-6064 Tel: (212) 373-3000 About Hexion Holdings Hexion Holdings LLC is the sole member of Hexion LLC, which is the sole owner of Hexion Inc. Based in Columbus, Ohio, Hexion Inc. -- https://www.hexion.com/ -- is a producer of thermoset resins or thermosets, and a producer of adhesive and structural resins and coatings. The company is incorporated in New Jersey while most of its co-debtors are Delaware limited liability companies or Delaware corporations. Hexion Inc. is the direct or indirect parent of the debtors and the non-debtor affiliates. Hexion Inc. employs 4,000 people around the world, including 1,300 in the U.S. across 27 production facilities. Hexion Holdings LLC and its co-debtors sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 19-10684) on April 1, 2019. At the time of the filing, the Debtors estimated assets and liabilities of between $1 billion and $10 billion. The cases are assigned to Judge Kevin Gross. The Debtors tapped Latham & Watkins LLP and Richards, Layton & Finger, P.A., as bankruptcy counsel; Paul Weiss Rifkind Wharton & Garrison LLP, as special financing and securities; Moelis & Company LLC as financial advisor; AlixPartners LLP as restructuring advisor; and Omni Management Group as claims, noticing, solicitation and balloting agent. The Office of the U.S Trustee appointed an official committee of unsecured creditors on April 10, 2019. The committee tapped Bayard P.A. and Kramer Levin Naftalis & Frankel LLP as its legal counsel. HOSPITAL ACQUISITION: May 17 Meeting Set to Form Creditors' Panel ----------------------------------------------------------------- Andy Vara, United States Trustee, for Region 3, will hold an organizational meeting on May 17, 2019, at 10:00 a.m. in the bankruptcy case of Hospital Acquisition LLC, et al. The meeting will be held at: The Doubletree Hotel 700 King Street Wilmington, DE 19801 The sole purpose of the meeting will be to form a committee or committees of unsecured creditors in the Debtors' case. The organizational meeting is not the meeting of creditors pursuant to Section 341 of the Bankruptcy Code. A representative of the Debtor, however, may attend the Organizational Meeting, and provide background information regarding the bankruptcy cases. To increase participation in the Chapter 11 proceeding, Section 1102 of the Bankruptcy Code requires that the United States Trustee appoint a committee of unsecured creditors as soon as practicable. The Committee ordinarily consists of the persons, willing to serve, that hold the seven largest unsecured claims against the debtor of the kinds represented on the committee. Section 1103 of the Bankruptcy Code provides that the Committee may consult with the debtor, investigate the debtor and its business operations and participate in the formulation of a plan of reorganization. The Committee may also perform other services as are in the interests of the unsecured creditors whom it represents. About Hospital Acquisition Headquartered in Plano, Texas, and founded in 1992, Hospital Acquisition LLC and its subsidiaries are operators of long-term acute care hospitals. Hospital Acquisition LLC and its subsidiaries sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del., Lead Case No. 19-10998) on May 6, 2019. The petition was signed by James Murray, chief executive officer and manager. The Debtor had estimated assets of $100 million to $500 million and liabilities of $100 million to $500 million. The Debtors tapped Akin Gump Strauss Hauer & Feld LLP and Young Conaway Stargatt & Taylor, LLP as counsel; Houlihan Lokey, INC. as financial advisor; BRG Capital Advisors LLC as investment banker; and Prime Clerk LLC as claims and noticing agent. ICONIX BRAND: Stockholders Elect Five Directors ----------------------------------------------- At the Annual Meeting of Stockholders of Iconix Brand Group, Inc., held on May 7, 2019, the Company's stockholders: (i) elected Justin Barnes, Peter F. Cuneo, Drew Cohen, Robert C. Galvin, and James Marcum to serve as directors of the Company to hold office until the Company's Annual Meeting of Stockholders to be held in 2020 and until their successors have been duly elected and qualified; (ii) ratified the appointment of BDO USA, LLP as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2019; (iii) approved, on a on-binding advisory basis, the compensation of the Company's named executive officers; and (iv) approved the amendment to the Company's Certificate of Incorporation to authorize the Board of Directors to effect a reverse stock split of the issued shares of the Company's common stock, at a reverse stock split ratio of not less than 1-for-2 and not more than 1-for-5. About Iconix Brand Broadway, New York-based Iconix Brand Group, Inc. -- http://www.iconixbrand.com/-- is a brand management company and owner of a diversified portfolio of over 30 global consumer brands across the women's, men's, entertainment, home and international segments. The Company's business strategy is to maximize the value of its brands primarily through strategic licenses and joint venture partnerships around the world, as well as to grow the portfolio of brands through strategic acquisitions. As of Dec. 31, 2018, the Company's brand portfolio includes Candie's, Bongo, Joe Boxer, Rampage, Mudd, London Fog, Mossimo, Ocean Pacific/OP, Danskin/Danskin Now, Rocawear/Roc Nation, Cannon, Royal Velvet, Fieldcrest, Charisma, Starter, Waverly, Ecko Unltd/Mark Ecko Cut & Sew, Zoo York, Umbro, Lee Cooper, and Artful Dodger; and interests in Material Girl, Ed Hardy, Truth or Dare, Modern Amusement, Buffalo, Hydraulic, and PONY. Iconix Brand incurred a net loss attributable to the Company of $100.5 million for the year ended Dec. 31, 2018, following a net loss attributable to the Company of $489.3 million for the year ended Dec. 31, 2017. As of Dec. 31, 2018, the Company had $632.07 million in total assets, $743.7 million in total liabilities, $34.13 million in redeemable non-controlling interests, and a total stockholders' deficit of $145.7 million. IHEARTMEDIA INC: May 31 Administrative Claims Bar Date ------------------------------------------------------ On January 22, 2019, the U.S. Bankruptcy Court for the Southern District of Texas entered an order confirming the modified fifth amended joint Chapter 11 plan of reorganization for iHeartMedia, Inc., and its debtor affiliates. As contemplated by the Plan and the Disclosure Statement Orders, the Debtors filed the Fourth Amended Plan Supplement for the Modified Fifth Amended Joint Chapter 11 Plan of Reorganization on April 29, 2019. The Plan Supplement documents remain subject to ongoing review, revision, and further negotiation by the parties to the Restructuring Support Agreement who have various consent rights over the final form of the Plan Supplement documents as may be amended, modified, supplemented, and revised in accordance therewith. The Court ordered that the Confirmation Order, any other applicable order of the Bankruptcy Court, or agreed to by the Holder of an Allowed Administrative Claim and the Debtors, all requests for payment of Administrative Claims, other than Administrative Claims arising under section 503(b)(9) of the Bankruptcy Code, which were required to be filed by the Claims Bar Date, must be filed and served on the Debtors no later than May 31, 2019. Holders of Administrative Claims that are required to file and serve a request for payment of such Administrative Claims that do not file and serve such a request by the Administrative Claims Bar Date shall be forever barred, estopped, and enjoined from asserting such Administrative Claims against the Debtors, or their property and such Administrative Claims shall be deemed discharged as of the Effective Date. About iHeartMedia 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 of iHeartMedia, Inc. and its affiliates. 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. INPRINT MANAGEMENT: June 11 Plan Confirmation Hearing ----------------------------------------------------- The Motion to Approve the Disclosure Statement explaining the Chapter 11 Plan of InPrint Management, Inc., is allowed and approved. The confirmation hearing will be held on June 28, 2019 at 11:00 AM at Boston Courtroom 3, 12th Floor, 5 Post Office Square, Boston, MA 02109. Last day to object to confirmation is June 11, 2019 at 4:30 PM. Deadline for Ballots is June 11, at 4:30 PM. Fee Applications shall be filed on or before May 21. Objections to Fee Applications shall be filed on or before June 11. About Inprint Management InPrint Management, Inc., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Mass. Case No. 18-11931) on May 24, 2018. In the petition signed by its president, Kevin Montecalvo, the Debtor estimated assets of less than $50,000 and debt ranging $500,000 to $1 million. George J. Nader, Esq., at Riley & Dever, P.C., serves as the Debtor's counsel. JAMES CANDY: Union Online Auction of Surplus Equipment Approved --------------------------------------------------------------- Judge Andrew B. Altenburg, Jr., of the U.S. Bankruptcy Court for the District of New Jersey authorized James Candy Co.'s public online auction of surplus chocolate candy making equipment to be conducted by Union Standard Equipment Co. A hearing on the Motion was held on May 7, 2019 at 10:00 a.m. The Debtor authorized to consummate the sale of the items specified in the Motion by online auction, with such items to be conveyed free and clear of liens, with the lien of OceanFirst Bank to attach to the proceeds of sale, subject to the Court's allowance of compensation to the Debtor's auctioneer. About James Candy Company James Candy Company is a candy company in Atlantic City, New Jersey, offering a wide selection salt water taffy, fudge, and macaroons. James Candy Company, based in Atlantic City, NJ, filed a Chapter 11 petition (Bankr. D.N.J. Case No. 18-32139) on Nov. 7, 2018. In the petition signed by Frank Glaser, president, the Debtor disclosed $2,756,944 in assets and $3,048,241 in liabilities. The Hon. Andrew B. Altenburg Jr. oversees the case. Ira R. Deiches, Esq., at Deiches & Ferschmann, serves as bankruptcy counsel to the Debtor. JAMES JELINEK: Son Buying Box Butte County Property for $524K ------------------------------------------------------------- James Lee Jelinek and Laurie Ann Jelinek ask the U.S. Bankruptcy for the District of Nebraska to authorize them to sell to Zachary L. Jelinek, their son, the real property located at 25 North, Range 48, West of the 6th P.M., Box Butte County, Nebraska, legally described as Section 34, SE%, except tracts described at Book 46, Page 417, and Book 87, Page 444 of the Deed records of the Box Butte County Clerk, and irrigation equipment located thereon, for $524,000. The parties have entered into their Agreement for Sale of Real Estate. The purchase price is based upon the appraisal of Parcel 7 conducted by Agri Affiliates, Inc. Farm Credit Services of America, FLCA, consents to the sale. The real property will be sold after the objection time has run, free and clear of any lien, claim, or encumbrance of any party. The closing costs, real estate taxes and all costs will first be deducted from the proceeds and the balance of the proceeds will be paid to the secured creditor, Farm Credit. A copy of the Agreement attached to the Motion is available for free at: http://bankrupt.com/misc/James_Jelinek_142_Sales.pdf The Purchaser: Zachary L. Jelinek 134 West 21st Street Alliance, NE 69301 Telephone: (308) 762-7622 James Lee Jelinek and Laurie Ann Jelinek sought Chapter 11 protection (Bankr. D. Neb. Case No. 18-40698) on April 20, 2018. The Debtors tapped John C. Hahn, Esq., at Wolfe, Snowden, Hurd, uers & Ahl, LLP, as counsel. JEFFERIES FINANCE: Fitch Places 'BB' LT IDR on Watch Positive ------------------------------------------------------------- Fitch Ratings has placed the 'BB-' long-term Issuer Default Ratings of Jefferies Finance LLC and its debt co-issuing subsidiary, JFIN Co-Issuer Corporation, on Rating Watch Positive. Fitch has affirmed the existing senior secured debt rating at 'BB' and the existing senior unsecured debt rating at 'BB-'. These actions follow JFIN's announced refinancing transaction, which includes issuing a new $700 million senior secured term loan due 2026, anticipated issuance of senior secured notes, and entering into an agreement for a new $275 million three-year priority revolving credit facility. JFIN intends to use the net proceeds from the offerings, combined with cash on hand, to repay its existing senior secured term loan and three of its four outstanding senior unsecured notes issuances. Fitch expects to resolve the Rating Watch Positive upon execution of the planned debt issuances and the repayment of existing debt, which is expected to occur on June 3, 2019, at which point Fitch would expect to upgrade JFIN's long-term IDR by one notch to 'BB'. At that point, existing debt ratings would be affirmed at their current levels. Concurrently, Fitch has assigned expected ratings of 'BB+(EXP)' to JFIN and JFIN Co-Issuer Corporation's senior secured priority revolving credit facility, 'BB(EXP)' to the senior secured term loan and 'BB(EXP)' to the senior secured notes. KEY RATING DRIVERS IDRS AND SENIOR DEBT The Rating Watch Positive reflects Fitch's expectation for continued improvement in leverage levels, as debt-to-tangible equity would decline to 4.4x, pro forma for the refinancing transactions, down from 4.8x at Feb. 28, 2019. This follows the maintenance of leverage below 5.0x over the past year, which has brought JFIN's leverage level below Fitch's 'bb' rating category quantitative leverage benchmark range of 5.0x-7.0x for balance sheet intensive finance and leasing companies. Fitch expects JFIN's leverage will remain at or below current levels (pro forma) over the Outlook horizon. JFIN's ratings remain supported by the benefits of its relationship with Jefferies Group LLC (Jefferies; BBB/Stable), which provides the firm with ample access to underwriting deal flow and the resources of the broader platform. The ratings are also supported by a strong and experienced management team, focus on senior lending relationships in the funded portfolio, absence of material portfolio concentrations, solid asset quality performance, variable cost structure and supportive owners, including Jefferies and Massachusetts Mutual Life Insurance Company (MassMutual; AA/Stable). Both Jefferies and MassMutual have provided JFIN with debt funding and incremental equity investments over time to support business expansion. Rating constraints include higher-than-peer leverage, albeit declining; a primarily secured funding profile; potential liquidity and leverage impacts of meaningful draws on revolver commitments; and sensitivity of deal flow and syndication capabilities to market conditions. The ratings also contemplate the current aggressive underwriting conditions in the broadly syndicated market, which include higher underlying leverage, meaningful EBITDA adjustments, and, in many cases, the absence of financial covenants, all of which could lead to meaningful deterioration in asset quality performance in a more challenged operating environment. JFIN is jointly and equally owned by Jefferies and MassMutual through their combined $1.5 billion equity commitment to the firm. JFIN has exclusive access to arrange all loans originated by Jefferies, and fees are split with Jefferies depending on the structure of the underwriting transaction (committed or best efforts basis). JFIN also reimburses Jefferies for all shared services and for services performed on its behalf. Fitch believes Jefferies has a relatively strong franchise in middle market lending, which provides JFIN with access to ample deal flow. According to Bloomberg, Jefferies was the sixth largest bookrunner in U.S. sponsored leveraged loans during 2018. From an earnings perspective, JFIN's performance is heavily market dependent, as underwriting revenues are driven by transaction volumes and mix. The firm arranged a record $44.4 billion of transaction volume in fiscal 2018 (year ended Nov. 30, 2018) across 175 transactions, which was up from $42.1 billion across 161 transactions the prior year. During the three months ended Feb. 28, 2019 (1Q19), JFIN's arranged volume was $2.2 billion, down from $14.3 billion in 1Q18 as a result of the market volatility experienced early in 1Q19 and above-average levels of arranged volume in 1Q18 driven by favorable market conditions. Committed volume and best efforts volume each amounted to $22.2 billion (50% of total arranged volume) during 2018. Committed deals can be particularly risky if market conditions deteriorate between JFIN committing to a deal and fully allocating its book. While JFIN attempts to manage this risk through its underwriting process, which includes a thorough assessment of the borrower's credit risk, in addition to considerations related to pricing, capital markets, and distribution conditions, the risk of getting 'hung' on a committed deal can never be fully mitigated, in Fitch's view, which serves as a rating constraint. Despite the challenging market dynamics in 1Q19, JFIN successfully syndicated all commitments during the quarter and has successfully syndicated all commitments from fiscal 2017 to 1Q19. To offset a portion of the firm's revenue volatility, JFIN has built a funded loan portfolio, which consists largely of first lien broadly syndicated loans that are term financed with collateralized loan obligations. This portfolio is generally believed to be less risky than traditional middle market loan portfolios, as loans are made to larger, more established companies, which generate higher average EBITDA and stronger interest coverage ratios. However, the prevalence of EBITDA adjustments and add-backs likely skews the comparison to some extent. Fitch believes the funded loan portfolio is well-diversified from individual issuer and industry perspectives, particularly as compared to business development companies. JFIN has also been building a direct lending portfolio, which is focused on first lien lending to the middle market and has a small asset-based lending book. In aggregate, JFIN had $4.6 billion of loans, net of its allowance for loan losses, outstanding at Feb. 28, 2019, which represented a compound annual growth rate of 26.6% since fiscal year-end 2010. Fitch expects JFIN's on-balance sheet portfolio growth to slow in 2019 as the firm has shifted its focus towards growing its asset management business through additional third party capital raises, including CLOs managed by Apex Credit Partners LLC and separately managed accounts in its direct lending business. Asset quality on the funded loan portfolio has been relatively strong over time, with net charge-offs averaging 0.30% from fiscal 2012 through 2018 and amounting to 0.94% and 0.62% in 2018 and 1Q19 (trailing 12 months basis), respectively. Charge-offs ticked up in recent years, compared to historical levels, as a result of JFIN working out certain energy and retail investments. During fiscal 1Q19, JFIN recorded $18.7 million of other losses, net, which resulted largely from write-downs of certain equity investments in retail companies that were previously restructured. Losses have resulted from idiosyncratic issues and Fitch believes do not signal deterioration in JFIN's overall asset quality. That said, Fitch believes credit metrics across the industry are at unsustainable levels, and weaker underwriting conditions (higher underlying leverage, tighter spreads, and weaker covenant packages) could exacerbate loss performance when the credit cycle turns. JFIN's leverage, as measured by debt-to-tangible equity, amounted to 4.8x as of Feb. 28, 2019, in-line with leverage at fiscal 1Q18 (excluding borrowings outstanding under fronting lines) and down from 6.1x at fiscal 1Q17. Pro forma for the refinancing transaction, Fitch estimates that JFIN's leverage will decline to 4.4x. While JFIN's leverage remains elevated relative to other rated underwriters/lenders in the middle market space, Fitch believes it is appropriate for its rating category and the risk profile of the assets. JFIN has continued to execute on reducing leverage since 2016 as earnings have improved and the equity base has increased. Fitch expects JFIN's leverage to continue to decline over the outlook horizon. JFIN uses term CLOs, revolver CLOs and warehouse facilities to finance the funded loan portfolio (portfolio funding debt), while term debt and senior notes issuances (collectively, non-funding debt) and short-term fronting lines (funding debt) have been used to fund the underwriting business. The majority of JFIN's outstanding unsecured debt at fiscal 1Q19 included an incurrence-based covenant limiting non-funding debt to total equity to 1.75x. This ratio was 1.63x at Feb. 28, 2019 and is the metric the firm uses to manage its leverage. JFIN's most recent unsecured notes issuance (2024 maturity) amended this covenant to allow non-funding debt to total equity of 2.00x. After the refinancing transaction is complete, the 2024 notes will be the only unsecured debt outstanding, and therefore JFIN will be subject to the 2.00x incurrence-based covenant. While the portfolio funding debt is non-recourse to JFIN, Fitch views the CLO debt and warehouse facilities as a funding source for one of the firm's core businesses and, therefore, evaluates the firm's leverage on a consolidated basis. At Feb. 28, 2019, secured funding represented 70.1% of JFIN's total debt, but secured debt was just 12.3% of total non-funding debt. Pro forma for the refinancing transaction, Fitch estimates that secured funding will increase to 93% of total debt and 75.2% of non-funding debt. Fitch believes an unsecured funding component enhances funding flexibility, particularly in times of stress. Fitch therefore views the decline in the proportion of unsecured debt unfavorably but recognizes the improvement in fixed cost coverage that will result from the reduction in interest expense. Fitch views the proportion of unsecured debt in JFIN's funding profile, pro forma for the refinancing transaction, as adequate for the rating category. JFIN's unsecured debt issuance will remain opportunistic over time as CLOs remain a cost effective way to the fund the loan portfolio. JFIN's liquidity resources include unrestricted cash on the balance sheet (pro forma for repayment of fronted deals), which amounted to $2.3 billion at Feb. 28, 2019; available equity capital commitments from Jefferies and MassMutual ($254 million combined); and fronting facilities of $1.3 billion, which provided nearly $4.0 billion of capacity. JFIN also had warehouse facilities ($0.6 billion) and revolving capacity in term CLOs and revolver CLOs. Following the refinancing transaction, cash will decline to approximately $2.0 billion (pro forma for repayment of fronted deals) and JFIN will add $275 million of borrowing capacity under the revolving credit facility. Cash balances are volatile over time as they are based on the amount of transactions that have been fronted with balance sheet cash. JFIN's primary liquidity uses relate largely to underwriting commitments and unfunded revolver exposures. Liquidity risk arises for JFIN when it commits to underwriting multiple deals at one time. Should market conditions weaken or the market view of an individual credit deteriorate, the firm could have trouble allocating committed deals in a timely or profitable fashion. Should JFIN need to finance deals for a longer hold period, it could impair the firm's liquidity position and prevent it from committing to additional deals, which would also have an adverse impact on JFIN's earnings, reputation and market position. Additionally, as a lead arranger on underwriting transactions, JFIN is required to provide borrowers with revolving credit facilities. At Feb. 28, 2019, undrawn revolver commitments amounted to $2.2 billion, about $1.1 billion of which could be funded with CLOs and CLO warehouse capacity. The remaining obligations could be a potential call on the firm's liquidity if revolver utilization increases significantly above historical levels. The maintenance of adequate liquidity to finance revolver draws under stressed utilization scenarios is a key rating sensitivity. While Fitch believes JFIN's liquidity profile is adequate for the rating category, the funding commitments and undrawn revolver commitments are considered rating constraints. That said, JFIN has been managing its unfunded direct exposure through revolver CLOs along with strategic sales and participation programs in recent years. Fitch expects the firm will continue to expand the funding capacity for potential revolver draws over time, by expanding the investor base in revolving CLO structures and/or completing additional sales of revolver exposures. JFIN returned $150 million of capital to Jefferies and MassMutual ($75 million each) during 1Q19 and made tax distributions of $80 million ($40 million to each) during 2018. At Feb. 28, 2019, Jefferies and MassMutual each had undrawn equity commitments to JFIN of $127 million. These commitments decline to the extent the firm retains earnings in the business, although both Jefferies and MassMutual have increased their equity commitments to JFIN over time. JFIN has no stated dividend policy and historical dividends had been limited to tax distributions prior to the aforementioned return of capital in 1Q19. The returned capital remains available for JFIN to draw on in the future. The 'BB+(EXP)' super senior debt rating for the senior secured priority revolving credit facility is expected to be one-notch above the IDR (given the expectation that the IDR will be upgraded by one-notch when the refinancing transaction is complete), reflecting Fitch's expectation for good recovery prospects given strong asset coverage and the relatively low portion of first-out debt in JFIN's funding profile. The 'BB' secured debt rating for the existing senior secured term loan is rated one-notch above JFIN's 'BB-' long-term IDR, reflecting the firm's relatively large pool of unencumbered assets currently. This profile indicates good recovery prospects for secured debtholders under a stressed scenario. Following the completion of the refinancing transaction, Fitch would expect to withdraw the rating on the existing secured term loan since it will be repaid. The 'BB(EXP)' secured debt ratings for the new senior secured term loan and senior secured notes are expected to be equalized with the IDR (given the expectation that the IDR will be upgraded by one-notch when the refinancing transaction is complete), reflecting average recovery prospects under a stress scenario. The expected compressed notching, relative to the IDR, reflects the increase in secured funding as a proportion of JFIN's total debt outstanding and recourse non-funding debt, which Fitch believes reduces prospects for secured debtholders under a stressed scenario. The 'BB-' senior unsecured debt rating for the senior unsecured notes is currently equalized with the IDR but is expected to be lowered one-notch below the IDR (given the expectation that the IDR will be upgraded by one-notch when the refinancing transaction is complete). This reflects the higher balance sheet encumbrance and the largely secured funding profile following the refinancing transaction, which Fitch believes indicates weaker recovery prospects under a stressed scenario. SUBSIDIARY AND AFFILIATED COMPANY The long-term IDR and debt ratings of JFIN Co-Issuer Corporation are equalized with those of its parent, JFIN. JFIN Co-Issuer Corporation is essentially a shell finance subsidiary, with no material operations and is a co-issuer on the existing secured term loan and unsecured notes. JFIN Co-Issuer Corporation will also be a co-issuer on the new senior secured notes, term loan and revolving credit facility. RATING SENSITIVITIES IDRS AND SENIOR DEBT If the proposed debt issuances and repayments of existing debt are completed as anticipated, Fitch expects to upgrade the long-term IDR of JFIN and JFIN Co-Issuer Corporation by one notch to 'BB' with a Stable Outlook, reflecting the firm's improved leverage levels. Thereafter, Fitch views rating upside as limited in the near term. Longer term, rating upside could be driven by enhanced funding diversity, including an increase in the proportion of unsecured funding, a decline in leverage approaching 3.0x over the outlook horizon, a continued improvement in the firm's liquidity profile particularly as it relates to undrawn revolver commitments, evidence of strong asset quality performance of the funded loan portfolio through a credit cycle, increased revenue diversity, and improved consistency of operating performance over time. Negative rating action could be driven by a change in the firm's exclusive relationship with Jefferies, an increase in leverage on a consolidated basis to above 5.0x and/or on a non-funding basis approaching or exceeding the covenanted level, a weakening liquidity profile particularly as it relates to undrawn revolver commitments, meaningful deterioration in asset quality, and/or an extended inability to syndicate transactions, which results in material operating losses and/or weakens the firm's reputation and market position. However, should the transaction not close, Fitch would likely affirm JFIN's long-term IDR and debt ratings at their current levels. The super senior debt, secured debt and unsecured debt ratings are sensitive to changes in JFIN's long-term IDR and to the relative recovery prospects of the instruments. The debt ratings are expected to move in tandem with JFIN's long-term IDR, although the notching could change if there is a material change in the quality or amount of the unencumbered asset pool and/or a significant shift in the levels of secured and/or unsecured debt. SUBSIDIARY AND AFFILIATED COMPANIES JFIN Co-Issuer Corporation's ratings are expected to move in tandem with JFIN's ratings. JFIN is a commercial finance company that structures, underwrites and syndicates primarily senior secured loans to corporate borrowers. JFIN also purchases performing loans in the syndicated markets. Fitch has taken the following rating actions on JFIN's existing ratings: Jefferies Finance LLC JFIN Co-Issuer Corporation -- Long-term 'BB-' IDR placed on Rating Watch Positive; -- Secured debt affirmed at 'BB'; -- Unsecured debt affirmed at 'BB-'. Fitch has assigned the following expected ratings: Jefferies Finance LLC JFIN Co-Issuer Corporation -- Super senior debt rating 'BB+(EXP)'; -- Secured debt rating 'BB(EXP)'. JOSEPH G. FOUST: $14K Sale of Fixtures & Equipment to Meadows OK'd ------------------------------------------------------------------ Judge Edward G. Coleman, III, of the U.S. Bankruptcy Court for the Southern District of Georgia authorized Joseph G. Foust's sale of fixtures and equipment to Meadows Regional Medical Center for $14,000. The Debtor is authorized to (i) close the sale free and clear of liens, claims and interests in accordance with the Contract; (ii) pay costs and expenses in accordance with the Contract; and (iii) pay the net proceeds to Mount Vernon Bank. The case is In re Joseph G. Foust, Case No. 18-60161-EJC (Bankr. S.D. Ga.). Counsel for the Debtor: Jon A. Levis, Esq. MERRILL & STONE, LLC P.O. Box 129 Swainsboro, GA 30401 Telephone: (478) 237-7029 Facsimile: (478) 237-9211 E-mail: levis@merrillstone.com JRV GROUP: Case Summary & 20 Largest Unsecured Creditors -------------------------------------------------------- Debtor: JRV Group USA L.P. fdba Erwin Hymer Group USA L.P. dba American Fastbacks, Inc. dba Cliffride dba American Pride dba American Built 1945 Burgundy Place Ontario, CA 91761 Business Description: JRV Group USA L.P -- https://www.erwinhymergroup.com -- is based at 1945 Burgundy Place, Ontario, California. It was established on Jan. 30, 2015 to carry out the United States business of Erwin Hymer Group, a Germany-based recreational vehicle company. However, in 2016, all business activities of the Debtor were stopped, and it became a shelf company while EHG Global built out its Canadian operations through EHG NA. The Debtor resumed operating activities in November 2017 and continued to be owned indirectly by EHG Global until Jan. 31, 2019, comprising a portion of its North American operations. Between November 2017 and March 2018, the Debtor acquired various assets in four asset acquisition transactions. Beginning in March 2018, the Debtor operated as a second- tier original equipment manufacturer and alterer of Jeep Wranglers made by FCA US LLC, an affiliate of Fiat Chrysler Automobiles N.V. The Debtor's business typically focused on adding features to the vehicles, such as a tent for camping, that would make them more desirable for recreational vehicle dealers to sell to end users/consumers. Chapter 11 Petition Date: May 13, 2019 Court: United States Bankruptcy Court District of Delaware (Delaware) Case No.: 19-11095 Debtor's Counsel: Jeffrey W. Dulberg, Esq. Robert M. Saunders, Esq. Colin R. Robinson, Esq. PACHULSKI STANG ZIEHL & JONES LLP 919 N. Market Street, 17th Floor Wilmington, DE 91899 Tel: (302) 652-4100 Fax: (302) 652-4400 E-mail: jdulberg@pszjlaw.com rsaunders@pszjlaw.com crobinson@pszjlaw.com Debtor's Corporate, Ligitation, Labor, and Regulatory Counsel: BARNES & THORNBURG LLP Debtor's Restructuring Advisor: SHERWOOD PARTNERS INC. Debtor's Notice & Claims Agent: BMC GROUP, INC. https://is.gd/9Ey5z9 Estimated Assets: $1 million to $10 million Estimated Liabilities: $10 million to $50 million The petition was signed by Mark Weigel, president and sole director, JRV Group USA Management Corporation, general partner. A full-text copy of the petition is available for free at: http://bankrupt.com/misc/deb19-11095.PDF List of Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Diversified Machine Systems LLC Trade $131,548 1068 Elkton Dr. Colorado Springs, CO 80907 Frank Cabanski Sr. Tel: 719-226-5066 Mobile: 817-559-4301 Email: Frank@DMS-router.com 2. Revchem Composites Trade $81,551 PO Box 333 Bloomington, CA 92316 Chrisy Loswego Tel: 909-316-6597 Mobile: 909-753-5961 Email: Closwego@revchem.com 3. Ayvar Security Services, Inc. Trade $75,915 4424 Santa Anita Ave, Ste205 El Monte CA 91731 Tel: 626-758-1434 Email: rosana@ayvarsecurityservices.com 4. Bestop Trade $75,805 Lock Box 26638 c/o JP Morgan Chase 26638 Network Place Chicago, IL 60673 Shelly Gonzalez Tel: 303-464-2553 Email: Shelly.Gonzalez@bestop.com 5. Fatenal Company Trade $75,007 PO Box 769 Winona, MN 55987 William Han Tel: 909-673-0127 Email: CAONT@stores.Fastenal.com Whan@fastenal.com 6. Omnisource USA Trade $61,563 3810 Garner Rd Riverside, CA 92501 Laura Bullard Tel: 469-535-6664 ext 2001 Email: lbullardl@omnisourceusa.com 7. Travelers Professional $37,534 PO Box 660317 Services Dallas, TX 75266-0317 Travelers CL Remittance Center Tel: 800-252-2266/68 Email: CLdirectbill@Travelers.com 8. TPG Insurance Services Trade $37,361 10373 Trademark Street Suite F & G Rancho Cucamonga, CA 91730 Troy Hefner Tel: 909-786-1770 Mobile: 909-200-6043 Email: Troy@myTPG.com 9. Mercedez-Benz USA, LLC Trade $36,770 1 Mercedes Drive Montvale, NJ 07645 Mirek Kozieo Tel: 201-505-4630 Email: Mirek.Kozieo@mbusa.com 10. Laser Tech Trade $30,122 7400 Jurupa Ave Riverside, CA 92504 Chuck Markley Tel: 951‐354‐7141 chuck@lasertech911.com 11. Brand Makers Trade $28,224 464 South Main Street Spanish Forks, UT 84660 Auzzy Jensen Tel: 801‐798‐6470 Email: Accounting@Brandmakers.com auzzy@brandmakers.com 12. TJ Technologies Trade $27,923 31919 Rancho California Rd Ste 200‐442 Temecula, CA 92591 Tim Jones Tel: 760‐415‐7862 Email: Tjones@TJTechlowvolt.com 13. Allied Nationwide Security, Inc. Trade $23,979 7247 Hayvenhurst Ave, Suite A‐7 Van Nuys, CA 91406 Jamal Nomair Tel: 310‐752‐4870 Email: Jamal@AlliedNationwide.com 14. Family Events Trade $23,332 838 N. Delaware Street Indianapolis IN, 46204 Accounting Tel: 317‐236‐6515 Email: Accountingdept@Familyevents.com 15. V1 Motor Specialist Inc Trade $22,595 449 W. Foothill Blvd. # 168 Glendora, CA 91741 Ming Su Tel: 626‐377‐8883 Email: ming@V1motor.com 16. Foothill Auto Body Trade $21,730 9777 Foothill Blvd. Rancho Cucamonga, CA 91730 Dennis Carrillo Tel: 909-987-4609 Email: dennis.carrillo@foothillauto body.com 17. Westcoast Haulers Trade $21,215 41690 Ivy St, Ste B Murrieta, CA 92562 Scott Thompson Tel: 951-757-9100 Email: wchaulers@gmail.com 18. Ontario Reign Trade $21,000 901 Via Piemonte, Ste 370 Ontario, CA 91764 Katie Miller Tel: 909-912-1084 Email: Kmiller@Ontarioreign.com 19. National Coatings & Supplies Trade $19,934 PO Box 204383 Dallas, TX 75320‐4383 William Scroggins Tel: 951‐335‐0027 Email: william.scroggins@NCS‐coating.com 20. Dub Publishing, Inc. Trade $19,000 11803 Smith Avenue Santa Fe Springs, CA 90670 Kiani Tran Tel: 562‐228‐1737 Email: Kiani@DubMagazine.com K. INVESTMENT: Seeks to Hire Fisher-Sandler as Legal Counsel ------------------------------------------------------------ K. Investment Group, LLC, seeks approval from the U.S. Bankruptcy Court for the Eastern District of Virginia to hire Fisher-Sandler, LLC as its legal counsel. The firm will advise the Debtor regarding the administration of its Chapter 11 case; represent the Debtor at all examinations and in negotiation with its creditors; prepare a plan of reorganization; and provide other legal services in connection with its Chapter 11 case. Nathan Fisher, Esq., the firm's attorney who will be handlig the case, charges an hourly fee of $200. Mr. Fisher disclosed in court filings that he and other employees of his firm are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. Fisher-Sandler can be reached through: Nathan Fisher, Esq. Fisher-Sandler, LLC 3977 Chain Bridge Rd., #2 Fairfax, VA 22030 Phone: (703) 691-1642 About K. Investment Group K. Investment Group, LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No. 19-11220) on April 16, 2019. At the time of the filing, the Debtor estimated assets of less than $500,000 and liabilities of less than $500,000. LEGACY JH762: Voluntary Chapter 11 Case Summary ----------------------------------------------- Debtor: Legacy JH762, LLC 1000 N US Highway 1, #762 Jupiter, FL 33458 Business Description: Legacy JH762, LLC owns three real properties in Pinehurst, North Carolina and Jupiter, Florida having a total comparable sale value of $5.1 million. Chapter 11 Petition Date: May 13, 2019 Court: United States Bankruptcy Court Southern District of Florida (West Palm Beach) Case No.: 19-16308 Judge: Hon. Mindy A. Mora Debtor's Counsel: David L. Merrill, Esq. THE ASSOCIATES 1525 Prosperity Farms Road, Suite B West Palm Beach, FL 33403 Tel: (561) 877-1111 Email: dlmerrill@theassociates.com Total Assets: $5,100,100 Total Liabilities: $3,456,044 The petition was signed by James W. Hall, managing member. The Debtor stated it has no unsecured creditors. A full-text copy of the petition is available for free at: http://bankrupt.com/misc/flsb19-16308.pdf LIVING BENEFITS ASSET: 5th Cir. Affirms Ruling in Favor of Kestrel ------------------------------------------------------------------ Debtor-plaintiff Living Benefits Asset Management, L.L.C., brought the adversary proceeding captioned In the Matter of: LIVING BENEFITS ASSET MANAGEMENT, L.L.C., Debtor, LIVING BENEFITS ASSET MANAGEMENT, L.L.C., Appellant, v. KESTREL AIRCRAFT COMPANY, INCORPORATED, Appellee, No. 18-10510 (5th Cir.) against Kestrel Aircraft Co. for breach of contract. Living Benefits alleges that Kestrel failed to pay almost $900,000 owed for services that Living Benefits provided Kestrel to help it collateralize a corporate debt offering with life settlements. Following a bench trial, the bankruptcy court held that the contract was voidable because Living Benefits failed to register as an investment adviser in violation of the Investment Advisers Act of 1940. The district court affirmed the bankruptcy court's judgment. Living Benefits now appeals the district court's judgment. Upon review, the United States Court of Appeals, Fifth Circuit affirmed the district court's judgment. The specifics of this case involve an unfulfilled plan by defendant Kestrel Aircraft Co. to purchase life settlements to use as collateral in a corporate debt offering. Kestrel hoped to raise $135 million to develop a prototype of an aircraft it sought to manufacture and to purchase most of the assets of a competing aircraft manufacturer. As part of its financing scheme, Kestrel planned to offer investors the option of taking a security interest in life settlements that it would purchase. Kestrel retained debtor-plaintiff Living Benefits Asset Management, L.L.C., to help develop and ultimately execute this proposal. Living Benefits and Kestrel entered into an engagement letter, which set out the terms of Living Benefits' services. Living Benefits promised to provide Kestrel with "consulting and advisory services" in connection with Kestrel's financing plan. These services included helping Kestrel structure its financing plan, preparing a memorandum for investors, advising Kestrel "in structuring of the evaluation, acquisition and ownership of the Life Settlements," and "selecting and retaining strategic partners for [Kestrel], including a suitable custodian for the Life Settlements." Kestrel agreed to pay Living Benefits $950,000 for these services. Kestrel did not commit itself in the engagement letter to purchasing any life settlements. But it agreed that to the extent it did acquire any life settlements within the two following years, it would "engage[] [Living Benefits] to originate such Life Settlements" pursuant to a separate agreement attached as an exhibit to the engagement letter. Living Benefits performed its obligations under the engagement letter. But Kestrel's fundraising efforts were ultimately unsuccessful; thus, Kestrel did not purchase any life settlements, and the parties never entered into the origination agreement. Kestrel subsequently failed to pay almost $900,000 owed to Living Benefits under the engagement letter. Living Benefits subsequently filed for Chapter 11 bankruptcy. It initiated the present suit against Kestrel as an adversary proceeding in the bankruptcy court to collect the money owed under the engagement letter. Following a bench trial, the bankruptcy court found that Kestrel breached the engagement letter by failing to pay the agreed-upon fee. But it also found that Living Benefits was required to register as an investment adviser under the Investment Advisers Act of 1940 ("IAA") yet failed to do so. Accordingly, it concluded that the engagement letter was voidable and Living Benefits was not entitled to collect any of the funds due under the letter. Living Benefits appealed to the district court. It argued that the bankruptcy court erred in concluding that it was an investment adviser. The district court affirmed. The Court finds that under the engagement letter, Living Benefits promised to advise Kestrel about life settlements. Because the district court did not clearly err in finding that Living Benefits was in the business of rendering such advice, and because the Court concludes that the contemplated life settlements were investment contracts within the meaning of the IAA, Living Benefits was required to register as an investment adviser. Having failed to do so, it cannot now collect the balance Kestrel owes it under the engagement letter. Accordingly, the Court affirms the judgment of the district court. A copy of the Court's Decision dated Feb. 22, 2019 is available at https://bit.ly/2JfOr73 from Leagle.com. Mark H. Ralston, for Appellee. H. Joseph Acosta, for Appellant Based in Fort Worth, TX, Living Benefits Asset Management, LLC, filed for Chapter 11 bankruptcy protection (Bankr. N.D. Tex. Case No. 15-44621) on Nov. 16, 2015, listing its total assets at $885,000 and total liabilities $2,671,597. The petition was signed by Marcia Shieldknight, manager. LOUISIANA HEART: MIC, et al., Lose Summary Ruling Bid vs S. Finger ------------------------------------------------------------------ District Judge Jane Triche Milazzo denied Defendants MedCare Investment Corporation, Cardiovascular Care Group, Inc. ("CCG"), MedCare chairman Harry Jacobson, and CCG executives Steve Johnson and Douglas Koppang' motion for summary judgment in the case captioned SIMON FINGER, M.D., v. HARRY JACOBSON ET AL., SECTION: "H"(1), Civil Action No. 17-2893 (E.D. La.). Plaintiff Simon Finger is an orthopedic surgeon who alleges that he was fraudulently misled by Defendants to sell his private practice and join the Louisiana Heart Hospital, LMCHH PCP, LLC, (the "Hospital") as an employee. Plaintiff's Complaint alleges that Defendant MedCare is a private equity firm that held an investment interest in Defendant CCG. CCG is a healthcare company that indirectly owns the Hospital. Plaintiff alleges that Jacobson, Johnson, and Koppang made intentional and fraudulent misrepresentations regarding MedCare and CCG's financial situations and commitments to the Hospital in order to induce him to join the Hospital. In reliance on their statements, Plaintiff signed a seven-year contract with an annual salary of $1.3 million plus production bonuses. Plaintiff thereafter "shut down his private practice, divested his interest in [an unrelated] surgical hospital and [] physical therapy clinic, and sold his medical equipment and supplies to the Hospital. On May 1, 2016, he reported to work at the Hospital as an employee." Defendants claim that the employee settlement in the Hospital's Bankruptcy Action acts to bar Plaintiff's claims here. Defendants have moved for summary judgment on the basis of res judicata. On June 29, 2017, the Hospital filed a Chapter 11 plan of liquidation, which included a provision outlining a settlement with its employees. Specifically, the Plan states that it "proposes to resolve all Employee Claims against the Debtors and the Employee Released Parties" by "compromise and settlement of each and every Claim that an Employee may have against the Debtors and the Employee Released Parties in exchange for the payment to the Employee of the Employee Settlement Amount." The Plan defined "Employee Released Parties" as "CCG and MedCare and each of their Affiliates and subsidiaries, and their respective shareholders, partners, members, agents, advisors, officers, directors, attorneys, insurers, and employees." Plaintiff did not opt out of the settlement and received and deposited a check for $9,837.89. For a claim to be barred by the doctrine of res judicata, the following requirements must be met: (1) the parties must be identical or in privity; (2) the judgment in the prior action must have been rendered by a court of competent jurisdiction; (3) the prior action must have been concluded by a final judgment on the merits; and (4) the same claim or cause of action must have been involved in both actions. Defendants argue that all of these requirements are satisfied here and that Plaintiff's claims should be barred. The Court finds Defendants' arguments disingenuous at best. Defendants argue that because the language of the Plan settling employee claims against the Hospital and "Employee Related Parties" could arguably encompass the claims at issue here, then the "same claim or cause of action" prong is satisfied. To the contrary, "res judicata bars all claims that were or could have been advanced in support of the cause of action on the occasion of its former adjudication." The claims at issue here were neither brought in the Hospital's Bankruptcy Action nor could they have been. Plaintiff has not brought any claims against the Hospital and could not have brought his claims against Defendants, nondebtors, in the Hospital's Bankruptcy Action. The Fifth Circuit advises that when considering this prong, the Court should focus on "whether the cases are based on the same nucleus of operative facts."16 The operative facts of the Hospital's Bankruptcy Action involve its financial situation and the claims of its creditors. The operative facts in this matter involve actions taken by agents of Medcare and CCG in employing Plaintiff at the Hospital. Defendants cannot show how these two actions share a common nucleus of operative facts. Defendants spend the bulk of their Motion interpreting the general language of the Plan and arguing that it clearly and unambiguously releases and resolves Plaintiff's claims here. Defendants do not, however, identify how Plaintiff's claims were or could have been adjudicated in the Hospital's Bankruptcy Action. In fact, the Plan identified the claims expressly contemplated in the employee settlement as claims for paid days off; claims relating to the medical plan, various employee agreements, and programs; and claims under the Louisiana Wage Payment law and the WARN Act. Accordingly, Defendants have failed to show at least one of the requirements necessary to bar Plaintiff's claims under the doctrine of res judicata. Defendants' Motion does not assert any additional grounds for summary judgment. A copy of the Court's Order and Reasons dated Feb. 22, 2019 is available at https://bit.ly/2LF0Va8 from Leagle.com. Simon Finger, M.D., Plaintiff, represented by Jeffrey Lee Oakes, Beary & Oakes, LLC, Daniel A. Meyer, Bruno & Bruno & Joseph M. Bruno, Bruno & Bruno. Harry R. Jacobson, M.D., Douglas L. Koppang, Jr., Steven T. Johnson, MedCare Investment Corporation & Cardiovascular Care Group, Inc., Defendants, represented by Brett Page Furr , Taylor, Porter, Brooks & Phillips LLP, Jonathan A. Moore -- jonathan.moore@taylorporter.com -- Taylor, Porter, Brooks & Phillips LLP & Thomas R. Peak -- tom.peak@taylorporter.com -- Taylor, Porter, Brooks & Phillips LLP. Franciscan Missionaries of Our Lady Health System, Movant, represented by Thomas R. Temple, Jr., Breazeale, Sachse & Wilson, L. L. P, Alexandra Elise Vozzella, Ayres, Shelton, Williams, Benson & Paine, LLC & Joseph John Cefalu, III, Breazeale, Sachse & Wilson, L. L. P. MARIO LOZANO: Status Conference on Dorchester Property Sale Held ---------------------------------------------------------------- Judge Joan N. Feeney of the U.S. Bankruptcy Court for the District of Massachusetts held a status conference on May 1, 2019 on Mario Rene Lozano's proposed sale of the real property located at 52-54 Bicknell St., Dorchester, Massachusetts to Pilar Sanchez, free and clear of liens. The Chapter 11 case is In re Mario Rene Lozano (Bankr. D. Mass. Case No. 18-11315). MEMENTO MORI: American Lending Objects to Disclosure Statement -------------------------------------------------------------- American Lending Center, LLC, formerly US Employment Development Lending Center, files objection to the Disclosure Statement explaining Memento Mori, LLC's Chapter 11 Plan of Reorganization. ALC points out that in its current form, the Disclosure Statement does not provide "adequate information" that would allow ALC to evaluate its distribution or risks it will face. ALC further points out that the Disclosure Statement provides that the Debtor intends to market the Cary Property for sale, but fails to define the marketing period. ALC complains that the Disclosure Statement also fails to discuss the feasibility of the Plan the Disclosure Statement does not describe the value of the Cary Property or the estimated value of such a proposed sale of the Cary Property. ALC asserts that the Plan was not proposed in good faith and was proposed to advantage certain claim holders and to not treat claim holders fairly in violation of applicable law and in violation of section 1129(a)(3) of the Bankruptcy Code. According to Creditor, Plan, however, provide that ALC will necessarily be paid in full, instead, it states that ALC shall retain its liens until the "secured claim" is paid without specifically defining "secured claim." Accordingly, the Plan does not provide that ALC will be paid in full. ALC points out that the plan unfairly provides that the Town of Cary, but no other secured creditor, has a right of first refusal. ALC further points out that the Plan violates the absolute priority rule by affording a subordinated secured creditor—the Town of Cary—greater rights than ALC, a higher priority creditor. Counsel for American Lending Center, LLC, formerly US Employment Development Lending Center: Terri L. Gardner, Esq. 4140 Parklake Avenue GlenLake One, Suite 200 Raleigh, NC 27612 Telephone: (919) 329-3882 Facsimile: (919) 329-3799 Email: terri.gardner@nelsonmullins.com About Memento Mori Based in Cary, North Carolina, Memento Mori, LLC, dba Tonic Remedies, fdba Mayton Landlord, LLC, dba The Verandah, fdba King's Daughter Landlord, LLC, dba The King's Daughters Inn, fdba Kings Daughter Tenant, LLC, fdba DMC Historic Restoration, LLC, dba Rhea Hospitality, dba The Mayton Inn, filed a voluntary Chapter 11 petition (Bankr. E.D.N.C. Case No. 18-04661) on September 20, 2018. The case is assigned to Hon. David M. Warren. At the time of filing, the total assets of the Debtor is $24,198,540, while total liabilities is $20,809,509. The petition was signed by Colin Crossman, manager. MEMENTO MORI: Mercantile Capital Objects to Disclosure Statement ---------------------------------------------------------------- Mercantile Capital Corporation files an objection to the approval of the disclosure statement and confirmation of Memento Mori, LLC's Chapter 11 Plan of Reorganization. Mercantile complains that the Disclosure Statement does not provide adequate information and Mercantile is unable to evaluate its distribution or risks it will face. According to Mercantile, while the Disclosure Statement does provide that the Debtor will file an application to employ a broker within seven days of the Plan, it does not describe the marketing process and what, if any, other efforts beyond hiring a broker will take place. Mercantile complains that the Plan was not proposed in good faith and was proposed to advantage certain claim holders and to not treat claim holders fairly in violation of applicable law and in violation of Section 1129(a)(3) of the Bankruptcy Code. Mercantile points out that the Plan provides for Mercantile to be paid from the "Liquidation Proceeds," it does not, however, provide that Mercantile will be paid in full, rather, it states that Mercantile shall retain its liens until the secured claim is paid. Mercantile further points out, even more objectionable, are the provisions that contemplate that Mercantile may have a claim for deficiency and would be treated as an unsecured creditor. Mercantile asserts that based upon the value of the Cary Property in the Debtor's schedules, Mercantile is entitled to interest, fees, and costs under Section 506(b) to the extent it is oversecured. Mercantile complains that the Plan violates the absolute priority rule by affording a subordinated secured creditor—the Town of Cary—greater rights than Mercantile, a higher priority creditor. Counsel for Mercantile Capital Corporation: J. Ellsworth Summers, Jr. BURR & FORMAN LLP 50 N. Laura Street, Suite 3000 Jacksonville, FL 32202 Phone: (904) 232-7203 Fax: (904) 232-7201 Email: esummers@burr.com -- and -- Mignon Lunsford, Esq. BURR & FORMAN LLP 421 Fayetteville St., Suite 1150 Raleigh, NC 27601 Phone: (919) 334-4709 Fax: (919) 573-0771 Email: mlunsford@burr.com About Memento Mori Based in Cary, North Carolina, Memento Mori, LLC, dba Tonic Remedies, fdba Mayton Landlord, LLC, dba The Verandah, fdba King's Daughter Landlord, LLC, dba The King's Daughters Inn, fdba Kings Daughter Tenant, LLC, fdba DMC Historic Restoration, LLC, dba Rhea Hospitality, dba The Mayton Inn, filed a voluntary Chapter 11 petition (Bankr. E.D.N.C. Case No. 18-04661) on September 20, 2018. The case is assigned to Hon. David M. Warren. At the time of filing, the total assets of the Debtor is $24,198,540, while total liabilities is $20,809,509. The petition was signed by Colin Crossman, manager. MESKO RESTAURANT: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Six affiliates that have filed voluntary petitions seeking relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Mesko Restaurant Group II, Inc. (Lead Case) 19-11830 dba Rock & Brews Buena Park 23832 Rockfield Blvd., Suite 245 Lake Forest, CA 92630 Mesko Restaurant Group III, Inc. 19-11831 Mesko Restaurant Group IV, Inc. 19-11832 Mesko Restaurant Group LLC 19-11833 MRG Management, Inc. 19-11835 Mesko Restaurant Group V, Inc. 19-11837 Business Description: Mesko Restaurant Group dba Rock & Brews Buena Park operates bar & grill restaurants offering a menu of pizza, burgers & pub grub, plus a diverse beer list. Chapter 11 Petition Date: May 13, 2019 Court: United States Bankruptcy Court Central District of California (Santa Ana) Judge: Hon. Catherine E. Bauer Debtors' Counsel: Richard A. Marshack, Esq. MARSHACK HAYS LLP 870 Roosevelt Ave Irvine, CA 92620 Tel: 949-333-7777 Fax: 949-333-7778 Email: rmarshack@marshackhays.com - and - David Wood, Esq. MARSHACK HAYS LLP 870 Roosevelt Ave Irvine, CA 92620 Tel: 949-333-7777 Fax: 949-333-7778 Email: dwood@marshackhays.com Mesko Restaurant Group II's Estimated Assets: $500,000 to $1 million Mesko Restaurant Group II's Estimated Liabilities: $10 million to $50 million The petition was signed by Joshua Teeple, chief restructuring officer. A full-text copy of Mesko Restaurant Group II's petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/cacb19-11830.pdf MGT MANUFACTURING: Unsecureds to Get 100% from Property Sale ------------------------------------------------------------ MGT Manufacturing Corporation files a Chapter 11 plan and accompanying disclosure statement. Class 4, General Unsecured Creditors, will be paid in full. The Debtor will sell the property located at 2805 Liberty Way, McKeesport, PA 15133, and will pay this creditor in full. Class 2, World Business Lenders, LLC, the holder of a mortgage on 2805 Liberty Way, McKeesport, PA 15133. The Debtor intends to sell the collateral located at 2805 Liberty Way, McKeesport, PA 15133 and will pay this class in full upon the sale of the real estate. Class 3, Secured Real Estate and Priority Tax Claims, will be paid in full. The Debtor will sell the property located at 2805 Liberty Way, McKeesport, PA 15133 and will pay this creditor in full. Any liens will be retained until the sale of the real estate. This class will be paid with post confirmation interest. Class 5, Equity interests, in the Debtor will be retained with modifications upon the shareholders. The Plan will be funded by the sale of 2805 Liberty Way, McKeesport, PA 15133. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/y2vpu48d from PacerMonitor.com at no charge. About MGT Manufacturing Corp. MGT Manufacturing Corporation sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No. 18-24301) on Nov. 2, 2018. At the time of the filing, the Debtor estimated assets of less than $50,000 and liabilities of less than $100,000. The case has been assigned to Judge Carlota M. Bohm. The Debtor tapped Calaiaro Valencik as its legal counsel. MIDTOWN INVESTMENT: July 24 Deadline to File Plan, Disclosures -------------------------------------------------------------- The Bankruptcy Court issued an order establishing the following deadlines to secure the just, speedy, and inexpensive determination of the bankruptcy case of Midtown Investment Group, Inc.: a. For creditors who are required by law to file claims, the deadline is July 29, 2019 except that for governmental units the deadline to file claims is 180 days from the date the petition was filed. b. The deadline for the debtor to file motions is May 24, 2019. This is also the deadline to file all unfiled overdue tax returns. The case will not be delayed due to unfiled tax returns. c. The deadline for parties to request the debtor to include any information in the disclosure statement is June 24, 2019. d. The deadline for the debtor to file a combined plan and disclosure statement is July 24, 2019. e. The deadline to return ballots on the plan, as well as to file objections to final approval of the disclosure statement and objections to confirmation of the plan, is September 3, 2019. The completed ballot form shall be returned by mail to the debtor's attorney: Brett A. Border, Esq. Border Law PLLC 24725 W. 12 Mile Road, Suite 110 Southfield, MI 48034 f. The hearing on objections to final approval of the disclosure statement and confirmation of the plan shall be held on Tuesday, September 10, 2019 at 10:30 a.m., in Room 1875, 211 W. Fort Street, Detroit, Michigan. g. The deadline for all professionals to file final fee applications is October 10, 2019. h. The deadline to file objections to this order is May 22, 2019. i. The deadline for taxing authorities to file a motion to allow an administrative expense is July 24, 2019. j. The deadline to file a motion to extend the deadline to file a plan is June 24, 2019. k. These dates and deadlines are subject to change upon notice if the debtor files a plan before the deadline in paragraph d above. About Midtown Investment Group Midtown Investment Group Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No. 19-44507) on March 26, 2019. At the time of the filing, the Debtor estimated assets and liabilities of less than $500,000. The case is assigned to Judge Marci B. Mcivor. Border Law PLLC is the Debtor's legal counsel. MITE LLC: July 2 Hearing on Disclosure Statement ------------------------------------------------ The hearing to consider the approval of the Disclosure Statement explaining the Chapter 11 plan of reorganization of Mite, LLC, will be held on July 2, 2019 at 10:00 a.m. in Courtroom 3-D of the U.S. Bankruptcy Court, U.S. Courthouse, 6500 Cherrywood Lane, Greenbelt, Maryland 20770. June 5, 2019, is fixed as the last day for filing and serving written objections to the Disclosure Statement. Each general unsecured creditor will receive semi-annual payments of 2% of the amount claimed in any proof of claim or established by order of Court or by operation of law beginning on the first anniversary of the effective date of the Plan as follows and continuing for the following 47 months, for a total payment of 16% of the amount owed. A full-text copy of the Disclosure Statement is available at https://tinyurl.com/y5c7mfwc from PacerMonitor.com. About Mite, LLC Mite, LLC, filed a Chapter 11 bankruptcy petition (Bankr. D. Md. Case No. 18-19966) on July 27, 2018. In the petition signed by I. David Bacharach, managing member, the Debtor estimated under $50,000 assets and under $1 million in liabilities. The Debtor is represented by David J. Kaminow, Esq., at Inman Kaminow, P.C. MONITRONICS INTERNATIONAL: Gets Forbearance Extension Until May 15 ------------------------------------------------------------------ As previously announced, on April 1, 2019, Monitronics International, Inc., failed to make the interest payment due on its 9.125% Senior Notes due 2020 and such failure constituted a default under that certain Indenture, dated as of March 23, 2012. The Company's failure to make the Interest Payment within 30 days after it was due and payable constitutes an "event of default" under the Indenture. As active discussions are still ongoing regarding the Company's evaluation of strategic alternatives, the board of directors of the Company determined that the Company would not make the Interest Payment prior to the expiration of the thirty day grace period. An event of default under the Indenture also constitutes an "event of default" under the Company's Credit Agreement, dated as of March 23, 2012. The Company, certain of its subsidiaries party to the Credit Agreement, Bank of America, N.A., as administrative agent and certain lenders entered into a Forbearance Agreement (as amended and as further amended by Amendment No. 5 and Amendment No. 6 and the Company and the guarantors of the Notes entered into a forbearance agreement with certain holders of the Notes. On May 7, 2019 and May 10, 2019, the Company received e-mail notices from the Forbearing Noteholders that the Notes Forbearance Agreement will be extended to May 10, 2019 and May 15, 2019, respectively, unless certain specified circumstances cause an earlier termination, pursuant to Section 2(g) of the Notes Forbearance Agreement. Further, the parties to the Credit Forbearance Agreement extended the Credit Forbearance Agreement to May 10, 2019 and May 15, 2019, pursuant to that certain Amendment No. 5 to the Credit Forbearance Agreement dated as of May 8, 2019 and by that certain Amendment No. 6, dated as of May 10, 2019, respectively, unless certain specified circumstances cause an earlier termination. About Monitronics Farmers Branch, Texas-based Monitronics International, Inc. -- http://www.mymoni.com/-- operates as Brinks Home Security, a home security and alarm monitoring company. Headquartered in the Dallas Fort-Worth area, Brinks Home Security provides residential customers and commercial client accounts with monitored home and business security systems, as well as interactive and home automation services, in the United States, Canada and Puerto Rico. Brinks Home Security customers are obtained through our direct-to-consumer sales channel or its exclusive authorized dealer network, which provides product and installation services, as well as support to customers. Monitronics is a wholly-owned subsidiary of Ascent Capital Group, Inc. Monitronics reported a net loss of $678.75 million for the year ended Dec. 31, 2018, compared to a net loss of $111.29 million for the year ended Dec. 31, 2017. As of Dec. 31, 2018, Monitronics had $1.30 billion in total assets, $1.89 billion in total liabilities, and a total stockholders' deficit of $588.97 million. KPMG LLP, in Dallas, Texas, the Company's auditor since 2011, issued a "going concern" qualification in its report dated April 1, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, citing that the Company has substantial indebtedness classified within current liabilities that raises substantial doubt about its ability to continue as a going concern. * * * In April 2019, S&P Global Ratings lowered the issuer credit rating on Monitronics International Inc. to 'SD' from 'CC'. The downgrade follows Monitronics' election not to make an approximately $26.7 million in interest on its 9.125% unsecured notes due 2020. Moody's Investors Service downgraded Monitronics' Corporate Family Rating to Ca from Caa2, as reported by the TCR on April 10, 2019. The downgrade reflects the Company's near-term debt maturities and the high likelihood of a default event under Moody's definition in the near term. N & B MANAGEMENT: June 4 Hearing on Disclosure Statement -------------------------------------------------------- On June 4, 2019 at 2:30 p.m., the hearing to consider the approval of the Disclosure Statement explaining the Chapter 11 Plan of N & B Management Company, LLC, will be held in Courtroom B, 54th Floor U.S. Steel Tower, 600 Grant Street, Pittsburgh, PA 15219. May 21, 2019 is the last day for filing and serving Objections to the Disclosure Statement. A full-text copy of the Disclosure Statement is available at https://tinyurl.com/y3wgo2o4 from PacerMonitor.com. About N & B Management Co N & B Management Company, LLC, filed a Chapter 11 bankruptcy petition (Bankr. W.D. Pa. Case No. 16-24728) on Dec. 23, 2016, estimating less than $1 million in assets and liabilities. Francis E. Corbett, Esq., is the Debtor's counsel. Jeffrey Sikirica was appointed Chapter 11 trustee in the Debtor's case on May 15, 2018. The Chapter 11 trustee is Jeffrey J. Sikirica. NANCY B. SCHOTT: Clark Buying Woodbury Property for $237K --------------------------------------------------------- Nancy Baker Schott asks the U.S. Bankruptcy Court for the Middle District of Tennessee to authorize the sale of the real property located on Hurricane Creek Road, Woodbury, Tennessee to Hugh W. Clark for $237,000. The Debtor is not the sole owner of the Property. She and her non-filing spouse, Richard N. Schott, own a one-half interest in the Property as tenants by the entireties, and Co-owner Christopher T. Carnahan owns a one-half interest in the Property. The Debtor's interest in the Property is encumbered by a debt to Farm Credit Services of Mid-America, FLCA in the approximate amount of $167,577 pursuant to a promissory note and Deed of Trust recorded with the Register of Deeds of Cannon County, Tennessee. The Lender will be paid a sum not to exceed its payoff from the sale proceeds for the release of its lien on the Property. The Debtor has determined in her business judgment that a sale of the Property is in the best interest of creditors and the bankruptcy estate. The offer is the highest and best offer for the Property presented to the Debtor. She desires to sell the Property under terms and conditions of their Contract for Sale of Real Estate. The terms of the Agreement are: a. Purchase Price: $237,000 b. Earnest Money: $10,000 c. Closing Date: May 20, 2019 d. Brokers' Commission: Carl D. Montgomery of Comas Montgomery Realty & Auction Co., Inc. will receive a commission of 6% of the Purchase Price Any agent of the Buyer will be paid a portion of the commission by the Seller's Broker. By the Motion, the Debtor asks entry of an order approving the sale of the Property on the terms set forth and granting other relief. She further asks the authority to use the proceeds from the sale of the Property to pay at closing (i) the lien of the Lender; (ii) any other claims that constitute liens on the Property; (iii) allowed commissions to the Seller's Broker; (iv) any other costs of sale to be paid by the Debtor, her non-filing spouse, and the Co-owner pursuant to the Agreement, including but not limited to applicable closing costs to be taxed to the Debtor, if any; and (v) one-half of the remaining net sale proceeds to the Co-owner. She also asks the Court to authorize her to deposit the net proceeds into a separate joint bank account held by the Debtor and her non-debtor spouse in a depository institution approved by the United States Trustee to be used in the matter set forth. Finally, the Debtor asks that the Court allows the sale to be consummated immediately pursuant to Bankruptcy Rule 6004(h). A hearing on the Motion is set for May 14, 2019 at 9:00 a.m. The objection deadline is May 6, 2019. A copy of the Contract attached to the Motion is available for free at; http://bankrupt.com/misc/Nancy_Schott_19_Sales.pdf The Purchaser: Hugh W. Clark Telepone: (615) 888-7771 E-mail: hclark@clarklumbercompany.com Nancy Baker Schott sought Chapter 11 protection (Bankr. M.D. Tenn. Case No. 19-02121) on April 2, 2019. The Debtor tapped Timothy G. Niarhos, Esq., at Niarhos & Waldron, PLC, as counsel. NEAL STUBBS: Tucci Buying Costa Rica Property for $435K ------------------------------------------------------- Neal A. Stubbs asks the U.S. Bankruptcy Court for the Middle District of Florida to reopen the administratively closed chapter 11 case for the sole purpose of considering the sale of the real property located in District 4 Bahia Ballena, County 5 Osa, in the Province of Puntarenas, Costa Rica, to Michael Fredrik Tucci for $435,000. Objections, if any, must be filed within 21 days from the date the Motion was served. The Court has confirmed the Debtor's Plan of Reorganization (together with modifications) which calls for a 100% distribution for allowed claims. On Dec. 8, 2017, the Court entered an Order Granting the Debtor's motion to compromise and administratively reclosing the Chapter 11 case. The Debtor is the owner of the real property, a 10-acre farm previously referred to as Retiro de Jade. The Jade Property has been marketed for sale post-confirmation. The Debtor has recently entered into the Sales Contract with the Buyer. The Jade Property is free and clear of liens and Plan payments are current. However, in an abundance of caution, the Debtor asks Court approval of the sale. He asks the Court to authorize him to consummate the subject sale and after approving the sale, he asks the Court to administratively close the chapter 11 case. A copy of the Contract attached to the Motion is available for free at: http://bankrupt.com/misc/Neal_Stubbs_206_Sales.pdf The Purchaser: Michael Fredrik Tucci San José Santa Ana, Costa Rica CR Residency ID No. 184001386902 Counsel for the Debtor: Mary A. Joyner, Esq. LAW OFFICES OF MARY A. JOYNER, PLLC 1503 South U.S. Highway 301, Suite 115 Tampa, FL 33619 Telephone: (813) 328-2115 E-mail: Mary@AttorneyJoyner.com Neal A. Stubbs sought Chapter 11 protection (Bankr. M.D. Fla. Case No. 13-11303) on Aug. 26, 2013. NEIMAN MARCUS: Extends Early Tender Deadline to May 15 ------------------------------------------------------ Neiman Marcus Group LTD LLC announced that as of 5:00 p.m., New York City time, on May 10, 2019, at least $1,477.0 million in aggregate principal amount of its existing unsecured 8.000% Senior Cash Pay Notes due 2021 and existing unsecured 8.750%/9.500% Senior PIK Toggle Notes due 2021, representing approximately 91.5% of the total outstanding principal amount of Existing Notes, had been validly tendered and not validly withdrawn in conjunction with the Company's previously announced offers to exchange any and all of its Existing Notes. The Company also announced the extension of the Original Early Tender Date to 5:00 p.m., New York City time, on May 15, 2019, unless extended by the Company. Accordingly, Eligible Holders who validly tender Existing Notes prior to the New Early Tender Date will be eligible to receive, on a par-for-par basis, a combination of (a) non-voting cumulative preferred shares of Series A Preferred Stock of MYT Holding Co., a U.S. holding company that will indirectly hold, prior to the settlement date of the Exchange Offers, NMG Germany GmbH, which holds and conducts the operations of MyTheresa, accruing dividends at a rate of 10.000% per annum and (b) new third lien notes due 2024, bearing interest payable in cash at a rate of 8.000% per annum in respect of exchanged Existing Cash Pay Notes and 8.750% per annum in respect of exchanged Existing PIK Toggle Notes. Eligible Holders who validly tender after the New Early Tender Date but prior to 11:59 p.m., New York City time, on May 24, 2019, unless extended or earlier terminated by the Company, will be eligible to receive New Third Lien Notes on a par-for-par basis. As of May 10, 2019, the right to withdraw tenders of Existing Notes and related consents has expired. Accordingly, Existing Notes tendered for exchange may not be validly withdrawn and consents may not be revoked, unless required by applicable law or the Company determines in the future in its sole discretion to permit withdrawal and revocation rights. Concurrently with the Exchange Offers, upon the terms and subject to the conditions set forth in the Offering Memorandum and related Letter of Transmittal, the Company has been soliciting consents from holders of the Existing Notes to certain proposed amendments to the indentures governing the Existing Notes to remove substantially all of the restrictive covenants contained therein and effect certain other changes. The Company has received consents sufficient to approve the proposed amendments to the Existing Indentures and will, together with the parties thereto, enter into supplemental indentures containing such proposed amendments, which amendments will not become operative until settlement of the Exchange Offers. The Exchange Offers are being made, and the New Third Lien Notes and MYT Series A Preferred Stock are being offered and issued, only (a) in the United States to holders of Existing Notes who the Company reasonably believes are "qualified institutional buyers" (as defined in Rule 144A under the Securities Act of 1933, as amended) or institutional "accredited investors" (within the meaning of Rule 501(a)(1), (2), (3) or (7) of Regulation D under the Securities Act) in a private transaction in reliance upon the exemption from the registration requirements of the Securities Act and (b) outside the United States to holders of Existing Notes who are (i) persons other than "U.S. persons" (as defined in Rule 902 under the Securities Act) and (ii) "non-U.S. qualified offerees" (as will be defined in the eligibility letter described below) in reliance upon Regulation S under the Securities Act (collectively, "Eligible Holders"). The Company is making the Exchange Offers only to Eligible Holders through, and pursuant to, the terms of the Offering Memorandum and related Letter of Transmittal. None of the Company, the dealer managers, the information agent, the exchange agent, the trustee with respect to the Existing Notes or the trustee with respect to the New Third Lien Notes or any affiliate of any of the foregoing makes any recommendation as to whether Eligible Holders should tender or refrain from tendering all or any portion of the principal amount of such Eligible Holder's Existing Notes for New Third Lien Notes and MYT Series A Preferred Stock in the Exchange Offers. Eligible Holders must make their own decision as to whether to tender Existing Notes in the Exchange Offers and, if so, the principal amount of Existing Notes to tender. The New Third Lien Notes and the MYT Series A Preferred Stock have not been registered under the Securities Act or the securities laws of any state and may not be offered or sold in the United States absent registration or an exemption from the registration requirements of the Securities Act and applicable state securities laws. Documents relating to the Exchange Offers will only be distributed to Eligible Holders who certify that they are within the category of Eligible Holders for these private exchange offers and who properly complete an eligibility letter electronically through the website of D.F. King & Co., Inc., the information agent for the Exchange Offers, at www.dfking.com/nmg, or by calling (866) 751-6310 or emailing nmg@dfking.com. About Neiman Marcus Headquartered in Dallas, Texas, Neiman Marcus Group LTD LLC -- http://www.neimanmarcusgroup.com/-- is a luxury, multi-branded, omni-channel fashion retailer conducting integrated store and online operations under the Neiman Marcus, Bergdorf Goodman, Last Call, Horchow, and mytheresa brand names. Neiman Marcus reported net earnings of $251.1 million in fiscal year 2018, compared to a net loss of $531.8 million in the fiscal year 2017. As of Jan. 26, 2019, the Company had $7.26 billion in total assets, $810.2 million in total current liabilities, $6.04 billion in total long-term liabilities, and $412.9 million in total member equity. Neiman Marcus stated in its Quarterly Report on Form 10-Q for the period ended Jan. 26, 2019 that, "We believe that cash generated from our operations, our existing cash and cash equivalents and available sources of financing will be sufficient to fund our cash requirements during the next 12 months, including merchandise purchases, operating expenses, anticipated capital expenditure requirements, debt service requirements, income tax payments and obligations related to our Pension Plan. "We regularly evaluate our liquidity profile, and various financing, refinancing and other alternatives for opportunities to enhance our capital structure and address maturities under our existing debt arrangements. If opportunities are available on favorable terms, we may seek to refinance, exchange, amend and/or extend the terms of our existing debt or issue or incur additional debt." On March 1, 2019, the Company reached an agreement in principle with the ad hoc committees of Noteholders and Term Lenders regarding the framework of a comprehensive series of transactions to extend the maturities of the Notes and Term Loans, as outlined in a term sheet disclosed in the Company's Current Report on Form 8-K filed on March 1, 2019. "The Company is engaged with the ad hoc committees of Noteholders and Term Lenders in ongoing negotiations with the goal of agreeing on definitive documentation with respect to such transaction. If the Company is unable to complete these transactions as contemplated or any other alternative transaction, on favorable terms or at all, due to market conditions or otherwise, its financial condition could be materially and adversely affected," Neiman Marcus said. * * * As reported by the TCR on March 29, 2019, Moody's affirmed the company's Corporate Family Rating at 'Caa3' and its Probability of Default rating of 'Ca-PD'. This rating action follows the Company's announcement on March 25, 2019 that it has entered into a transaction support agreement with lenders representing approximately 57% of the company's Term Loan and more than 60% of the holders of the Company's Unsecured Notes. NICHOLAS KAYE: Selling Personal Property for $15K ------------------------------------------------- Nicholas Kaye and Lori Kaye ask the U.S. Bankruptcy Court for the Eastern District of Wisconsin to authorize their sale of (i) a 1967 Camaro, VIN 124377N117358, to Matt Schmitt for $7,000; (ii) a 2004 Hyundai vehicle, VIN 13254B6018-3, to Deborah and Jake School for $250; and (iii) a 2005 STV River Rocket Boat, with trailer, to Justin Pape for $8,000. When the Debtors filed their bankruptcy case, they owned certain items of personal property. After the bankruptcy case was filed, Nicholas Kaye became ill, and he subsequently passed away on April 28, 2018. The Movants wish to liquidate certain personal property that was formerly used by Nicholas Kaye, because they are no longer using the property. The Movants have received proposals to purchase certain items of personal property: A. The Debtors have received an offer to purchase a 1967 Camaro Vin# 124377N117358 for the amount of $7,000. (The vehicle does not currently run and is a project car). They estimated the value of the vehicle in their bankruptcy schedules as $8,000. The proposed buyer is Matt Schmitt, who is the nephew of Lori Kaye. The Movants believe that the offer represents the fair market value of the vehicle. B. The Movants have received a proposal from Deborah and Jake School to purchase a 2004 Hyundai vehicle, Vin 13254B6018-3 for the amount of $250. They estimated the value of the vehicle in their schedules as $400. The vehicle is old and damaged. The proposed purchasers are personal friends of the Movants. The vehicle is not in good condition. The Movants believe that the offer represents the fair market value of the vehicle. C. The Debtors have received a proposal from Justin Pape to purchase a 2005 STV River Rocket Boat, with trailer, for the purchase price of $8,000. Mr. Pape was a former employee of Cyber CNC Machinery Sales, Inc., and he is a family friend. The boat is being sold "as is" and "where is." The Debtors estimated the value of the boat in their bankruptcy schedules as $8,000, and they estimated the value of the trailer as $1,000. The Movants believe that the proposal represents the fair market value of the boat and trailer. The Debtors pray that an order be entered allowing them to sell the property pursuant to the proposals received, or to sell the property to alternative buyers for an amount not less than the amount of the current proposals, and granting such further relief as is just and equitable. Nicholas Kaye and Lori Kaye sought Chapter 11 protection (Bankr. E.D. Wis. Case No. 17-22124) on March 15, 2017. The Debtors tapped Dayten P. Hanson, Esq., at Hanson & Payne, LLC, as counsel. PENGROWTH ENERGY: Incurs C$31.6 Million Net Loss in First Quarter ----------------------------------------------------------------- Pengrowth Energy Corporation reported a net loss and comprehensive loss of C$31.6 million on C$122.7 million of revenues for the three months ended March 31, 2019, compared to a net loss and comprehensive loss of C$27.2 million on C$121.5 million of revenues for the three months ended March 31, 2018. The net loss increased year-over-year primarily due to a $15.3 million charge related to lowering of the discount rate estimate for asset retirement obligation on assets with no remaining useful life combined with the absence of a deferred tax recovery of C$7.2 million recorded in the same period last year. These were partially offset by an unrealized foreign exchange gain in the current quarter compared to an unrealized foreign exchange loss in the same period last year and increased adjusted funds flow. "After the resilience Pengrowth demonstrated through record low Western Canadian Select crude oil pricing in the fourth quarter of 2018, we delivered the strongest quarterly adjusted funds flow in more than a year in the first quarter of 2019. Our leaner cost structure combined with the ongoing improvement in realized crude oil pricing allowed us to generate $10.1 million in Adjusted Funds Flow in the month of March alone and $16.0 million in the quarter," said Pete Sametz, president and chief executive officer of Pengrowth. "Lindbergh continues to produce at the high end of guidance while adhering to the terms of Alberta's curtailment program. We have been actively speaking to our major debt and equity investors who clearly understand the long-life low-decline nature of our reserves, and Pengrowth's capacity to generate strong adjusted funds flow at current prices." As of March 31, 2019, the Company had C$1.34 billion in total assets, C$1.12 billion in total liabilities, and C$220.9 million in shareholders' equity. In the first quarter of 2019 cash flow of C$7.8 million was used in operating activities compared with C$9.4 million in cash flow from operating activities in the fourth quarter of 2018 driven by changes in working capital and higher spending on remediation partly offset by higher realized bitumen prices. Compared with cash flow of C$12.3 million used in operating activities in the same period last year, cash flow from operating activities improved in the first quarter of 2019 as a result of increased bitumen production, lower realized losses on commodity risk management and favorable changes in working capital partly offset by higher spending on remediation. Adjusted Funds Flow increased to C$16.0 million in the first quarter compared with C$(2.3) million in the prior quarter due to increased oil production, stronger realized pricing, and lower costs. Adjusted Funds Flow increased 122% year-over-year compared with C$7.2 million in the same period of last year. The year-over-year increase was primarily due to higher bitumen production, the impact of decreased realized losses on commodity risk management and lower cash G&A compared with the same period last year. These were offset by lower realized natural gas prices due to the absence of natural gas production from SOEP, higher interest and financing charges mainly due to increased borrowings on the Credit Facility and an increase in adjusted operating expenses. During the first quarter of 2019, in conjunction with the extension of Pengrowth's revolving credit facility, the Company entered into WTI crude oil costless collars on 8,000 bbl/d with an average floor and ceiling of US$56.75/bbl and US$59.80/bbl respectively for the second quarter of 2019. Pengrowth uses physical delivery contracts to ensure access to markets, protect against pipeline apportionment, and limit credit risk and exposure to widening benchmark differentials between Western Canadian Select and West Texas Intermediate crude oil prices. As at March 31, 2019, Pengrowth had apportionment protected physical contracts in place that ensure market access for 17,500 bbl/d of diluted bitumen for 2019. Using a combination of physical and financial contracts, the average realized price on these volumes is expected to be WTI minus US$18.68/bbl. Compared with the fourth quarter, when similar contracts protected Pengrowth from wide differentials, Alberta's production curtailment program has led to the differential narrowing. As a result, Pengrowth realized risk management losses of C$15.8 million on these contracts ($10.7 million on apportionment protected fixed differential physical sales contracts, and C$5.1 million on swaps used to fix the differential on a 5,000 bbl/d of apportionment protected physical sales contracts). Pengrowth's total debt before working capital (excluding letters of credit) at March 31, 2019 increased 1% to C$721.5 million compared with C$714.6 million as at Dec. 31, 2018 partly due to C$5.6 million in abandonment and reclamation work that was front loaded into the first quarter, offset by an approximate $10 million advantageous swing in foreign exchange rates. Strategic Review Update The Strategic Review is proceeding as planned. Working with the Company's adviser Perella Weinberg Partners LP, and their subsidiary Tudor, Pickering, Holt & Co., the Company has assembled the virtual data room and the confidential information memorandum that is being circulated to interested parties. The Strategic Review is exploring a comprehensive range of strategic and transaction alternatives, including a sale, merger or other business combination; a disposition of all or certain assets of the Company; recapitalization and refinancing opportunities including new debt or equity capital and other alternatives to improve the Company's financial position and maximize value. In addition to Pengrowth's long-life, low-decline assets, the Company also has potentially attractive tax attributes that complement its strong base operations. Pengrowth and its adviser expect to actively explore market interest in potential transactions and strategic initiatives with a range of interested parties and capital market participants. There can be no guarantees as to whether the Strategic Review will result in a transaction or the terms or timing of any resulting transaction. Upcoming Debt Maturities On March 25, 2019 Pengrowth announced that it had reached arrangements for the extension of the maturity date under its secured revolving credit facility through Sept. 30, 2019, subject to certain terms. The Company's C$330 million Credit Facility is provided by a broad syndicate of domestic and international banks and had a scheduled maturity of March 31, 2019. The Company executed an extension agreement to its Credit Facility, supported by 100% of the lenders in the syndicate, providing for the extension of the maturity date under the Credit Facility to Sept. 30, 2019, by way of an initial extension to July 29, 2019 and two subsequent extensions to Aug. 29, 2019 and to Sept. 30, 2019, respectively, each of which will automatically become effective unless lenders with at least two thirds of the total commitments under the Credit Facility provide notice to the Company that such automatic extension will not apply in advance of the automatic extension dates. The extension of the Credit Facility will provide support to Pengrowth while it undertakes its previously-announced process to explore and develop strategic alternatives with a view to strengthening the Company's balance sheet, addressing upcoming debt maturities, and maximizing enterprise value. As at March 31, 2019, Pengrowth had drawings of C$191.0 million on its Credit Facility (Dec. 31, 2018 - C$173.5 million), and C$63.2 million of outstanding letters of credit (Dec. 31, 2018 - C$75.6 million). In addition to the maturity of the Credit Facility in 2019, certain of the Company's term notes in the aggregate principal amount of C$58.6 million mature on Oct. 18, 2019. As part of the Strategic Review, Pengrowth intends to explore and advance strategic alternatives including transactions or financings that address the upcoming maturities of the October 2019 term notes. It is likely that any offer to replace the Company's existing debt will likely come at a higher interest cost. Pengrowth's total debt before working capital is 71% denominated in foreign currencies at March 31, 2019. To manage foreign exchange risk, Pengrowth holds a series of swap contracts that fix the foreign exchange rate on 66% of the principal for Pengrowth's U.S. dollar denominated term debt. Multi-year Development Plan In June 2018, Pengrowth released its multi-year development plan to incrementally increase bitumen production at Lindbergh in bite sized steps rather than in one large phase. Expansion at Lindbergh will be achieved in incremental steps aligning capital spending with Pengrowth's expected cash flow, shifting the development methodology away from the previously contemplated large single phase approach. Development capital is expected to be focused on drilling new well pairs, additional infill wells, as well as, adding incremental facilities to debottleneck fluid handling capacity. The Corporation expects to implement co-injection of steam and Non-Condensible Gas ("NCG") to further enhance production by freeing-up steam for new wells while maintaining reservoir pressure which is expected to lower SORs. Regulatory approval for the application of NCG injection at Lindbergh was received in June of 2018. As previously announced, Pengrowth has signed a non-binding letter of intent with a third party to fund the development of additional co-generation capacity options at Lindbergh to provide Pengrowth with steam and power (under a fee structure) sufficient enough to support further efficient production expansions to reach approximately 35,000 bbl/d of bitumen. Capital to be committed to Lindbergh in 2020 and onwards will be dependent on the prevailing commodity prices. Groundbirch has a low cost structure which supports growth in production and cash flow under a stronger natural gas pricing environment. 2019 Capital Plan Until Pengrowth is able to refinance its term debt and renews its Credit Facility, capital spending will not exceed C$21 million. Pengrowth's 2019 Budget called for a capital spending plan of C$45 million, with 76% or C$34 million of this capital allocated to Lindbergh for continued production sustaining and maintenance activities, which includes drilling three well pairs to utilize existing steam capacity. Pengrowth will continue to assess timing for commencement of the development program which is anticipated to be no sooner than the second half of 2019. The remaining C$11 million of capital is related to maintenance and integrity activities to support the existing operations and for general corporate purposes, including approximately C$3 million to finalize the Groundbirch development program. A full-text copy of the Form 6-K report is available for free at: https://is.gd/amUM6Z About Pengrowth Pengrowth Energy Corporation -- http://www.pengrowth.com/-- is a Canadian energy company focused on the sustainable development and production of oil and natural gas in Western Canada from its Lindbergh thermal oil property and its Groundbirch Montney gas property. The Company is headquartered in Calgary, Alberta, Canada and has been operating in the Western Canadian basin for more than 30 years. The Company's shares trade on both the Toronto Stock Exchange under the symbol "PGF" and on the OTCQX under the symbol "PGHEF". Pengrowth reported a net loss and comprehensive loss of C$559.3 million in 2018, following a net loss and comprehensive loss of C$683.8 million in 2017. As of Dec. 31, 2018, the Company had C$1.34 billion in total assets, C$1.09 billion in total liabilities, and C$251.9 million in shareholders' equity. KPMG LLP, in Calgary, Canada, the Company's auditor since 1988, issued a "going concern" qualification in its report dated March 5, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, citing that the Company has significant uncertainties relating to its ability to meet its financial obligations on scheduled debt maturities and comply with certain debt covenants that raise substantial doubt about its ability to continue as a going concern. PEPPERTREE PARK: Aug. 12-16 Plan Confirmation Hearing ----------------------------------------------------- The Disclosure Statement for the Sixth Amended Plan of Peppertree Park Villages 9 and 10, LLC, Peppertree Land Company, Northern Capital, Inc., and Duane Scott Urquhart is approved. This Court will hold a hearing on confirmation of the Plan on August 12, 13, and 16, 2019 beginning at 10:00 a.m. (Prevailing Pacific Time) each day at the United States Bankruptcy Court for the Southern District of California, 325 West F Street, Courtroom 129 (Dept. 3), San Diego, CA 92101. The deadline for filing objections to confirmation of the Plan is June 24, 2019. In order to be counted as a vote to accept or reject the Plan, each Ballot must be properly executed so as to be received no later than June 24, 2019 at 4:00 p.m. (Prevailing Pacific Time). About Peppertree Park Villages Headquartered in Bonsall, California, Peppertree Park Villages 9 and 10, LLC, listed its business as a single asset real estate (as defined in 11 U.S.C. Section 101(51B)), whose principal assets are located at 1654 S. Mission Rd, Fallbrook, California. Peppertree Park is an affiliate of Northern Capital, Inc., which sought bankruptcy protection on Aug. 13, 2017 (Bankr. S.D. Cal. Case No. 17-04845). Peppertree Park Villages 9&10, LLC (Bankr. S.D. Cal. Case No. 17-05137) and affiliate Peppertree Land Company (Bankr. S.D. Cal. Case No. 17-05135) each filed for Chapter 11 bankruptcy protection on Aug. 28, 2017. The petitions were signed by Duane Urquhart as managing general partner, who also sought bankruptcy protection on Aug. 13, 2017 (Bankr. S.D. Cal. Case No. 17-04846). Peppertree Land and Peppertree Park each estimated their assets and liabilities at between $1 million and $10 million. Marwill Hogan, Esq., at Foley & Lardner, LLP, serves as the Debtors' bankruptcy counsel. PLAIN LEASING: Unsecureds Paid Monthly for 60 Months ---------------------------------------------------- Plain Leasing, Inc., filed a Chapter 11 plan and accompanying disclosure statement, which incorporated a settlement with the Official Committee of Unsecured Creditors. The term of the Settlement were as follows: (1) Truckers will withdraw objections or objection will be overrule; (2) The Settlement Agreement will be revised to state that on the Effective Date B&O on behalf of both the Defendants, shall pay Debtor the total sum of $60,000 in cash; (3) The First Amended Plan shall be modified to reflect the revision to the Settlement Agreement; and (4) As provided for and agreed on the record, Truckers will vote in favor of confirmation of the Plan. Based on these terms, the Committees counsel lodged an order granting 9019 Motion. On February 11, 2019, the court entered its order approving the 9019 Motion. Class 6 - General Unsecured Claims. Payment made on Effective date and every month theafter for 60 months. Source of payment is Debtor's cash on hand at Plan confirmation settlement payment from B&O and share holder's new value payment. The sources of money earmarked to pay creditors in this case will come from Debtor's net operating income, which is projected to be $3,500 per month, for the term of 5 years, $60,000 settlement payment from defendants B&O Logistics, Inc., to resolve an adversary action (the "Adversary Action") against B&O and Ji K Lim for fraudulent transfer claims, and a $200,000 lump sum cash payment from the Shareholder for a 100% ownership interest in the reorganized debtor. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/y4vzdxjs from PacerMonitor.com at no charge. About Plain Leasing Plain Leasing, Inc., f/k/a K Trans, Inc., which rents out trucks and chassis, filed a Chapter 11 bankruptcy petition (Bankr. C.D. Cal. Case No. 17-12539) on March 2, 2017. In the petition signed by Ji K. Lim, president, the Debtor estimated at least $50,000 in assets and $500,000 to $1 million in liabilities. The case is assigned to Judge Robert Kwan. The Debtor is represented by Joon M. Khang, Esq., at Khang & Khang LLP. The Office of the U.S. Trustee on July 5, 2017, appointed three creditors of to serve on the official committee of unsecured creditors. The committee members are: (1) Jae Seung Rho; (2) Sam Lee aka Yoon Lee; and (3) James Jae. The Committee retained Blakeley LLP as counsel, and the Law Firm of Kim & Min as special counsel. PUMAS CAB: June 12 Hearing on Disclosure Statement -------------------------------------------------- A hearing will be held on June 12, 2019, at 3:30 P.M on approval of the Third Amended Disclosure Statement and on for confirmation of the Third Amended Plan of Pumas Cab Corp. before the Honorable Carla E. Craig, United States Bankruptcy Judge, United States Bankruptcy Court for the Eastern District of New York, 271-C Cadman Plaza East, Brooklyn, New York, Courtroom 3529. All ballots voting in favor of or against the Third Amended Plan are to be submitted so as to be actually received by counsel for the Debtor on or before June 5 (CEC), 2019 at 4:00 p.m. Objections to approval of the Third Amended Disclosure Statement and (CEC) to confirmation of the Third Amended Plan must be in writing and must be filed by June 5 (CEC), 2019 at 4:00 p.m. About Pumas Cab Corp. Pumas Cab Corp. is a small business debtor as defined in 11 U.S.C. Section 101(51D) under the taxi and limousine service industry. It is an affiliate of Quizphi Cab Corp., which sought bankruptcy protection (Bankr. E.D.N.Y. Case No. 17-44085) on Aug. 7, 2017. Pumas Cab Corp., based in Astoria, New York, filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 17-44151) on Aug. 10, 2017. In the petition signed by Nelly Lucero, secretary, the Debtor disclosed $12,415 in assets and $2.64 million in liabilities. The Hon. Carla E. Craig presides over the Pumas Cab case. QUANTUM TRANSPORTATION: Case Summary & 20 Top Unsecured Creditors ----------------------------------------------------------------- Lead Debtor: Quantum Transportation, LLC 10603 Allentown Blvd P.O. Box 74 Ono, PA 17077 Business Description: Quantum Transportation and its subsidiaries are transportation providers for dry bulk commodities, liquid chemicals, dump transportation, and truckload deliveries. Chapter 11 Petition Date: May 13, 2019 Six affiliates that filed voluntary petitions seeking relief under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- Quantum Transportation, LLC 19-02063 J.P. Donmoyer, Inc. 19-02066 F.T. Silfies, Inc. 19-02067 Ono Transportation Services, Inc. 19-02068 Foundry Services Corporation 19-02069 Price Trucking, Inc. 19-02070 Court: United States Bankruptcy Court Middle District of Pennsylvania (Harrisburg) Judge: Hon. Henry W. Van Eck Debtors' Counsel: Robert E. Chernicoff, Esq. CUNNINGHAM, CHERNICOFF & WARSHAWSKY, P.C. 2320 North Second Street Harrisburg, PA 17110 Tel: 717 238-6570 Fax: 717 238-4809 E-mail: rec@cclawpc.com Quantum Transportation's Estimated Assets: $1 million to $10 million Quantum Transportation's Estimated Liabilities: $10 million to $50 million J.P. Donmoyer's Estimated Assets: $1 million to $10 million J.P. Donmoyer's Estimated Liabilities: $10 million to $50 million The petitions were signed by David Wechsler, chairman. A copy of Quantum Transportation's list of six unsecured creditors is available for free at: http://bankrupt.com/misc/pamb19-02063_creditors.pdf A copy of J.P. Donmoyer's list of 20 largest unsecured creditors is available for free at: http://bankrupt.com/misc/pamb19-02066_creditors.pdf Full-text copies of two of the Debtors' petitions are available for free at: http://bankrupt.com/misc/pamb19-02063.pdf http://bankrupt.com/misc/pamb19-02066.pdf QUIZHPI CAB: June 12 Hearing on Disclosure Statement ---------------------------------------------------- A hearing to consider approval of any amended disclosure statement and confirmation of any amended plan in the Chapter 11 case of Quizphi Cab Corp., will be held on June 12, 2019 at 3:30 P.M at the United States Bankruptcy Court for the Eastern District of New York, 271-C Cadman Plaza East, Brooklyn, New York, Courtroom 3529. That all ballots voting in favor of or against the amended plan are to be submitted so as to be actually received on or before June 5, 2019 at 4:00 p.m. That Objections to approval of the amended disclosure statement and to confirmation of the amended plan must be in writing and must be filed by June 5, 2019 at 4:00 p.m. About Pumas Cab Corp. Pumas Cab Corp. is a small business debtor as defined in 11 U.S.C. Section 101(51D) under the taxi and limousine service industry. It is an affiliate of Quizphi Cab Corp., which sought bankruptcy protection (Bankr. E.D.N.Y. Case No. 17-44085) on Aug. 7, 2017. Pumas Cab Corp., based in Astoria, New York, filed a Chapter 11 petition (Bankr. E.D.N.Y. Case No. 17-44151) on Aug. 10, 2017. In the petition signed by Nelly Lucero, secretary, the Debtor disclosed $12,415 in assets and $2.64 million in liabilities. The Hon. Carla E. Craig presides over the Pumas Cab case. REGDALIN PROPERTIES: Trustee Selling Carson Property for $950K -------------------------------------------------------------- R. Todd Neilson, Chapter 11 trustee for Regdalin Properties, LLC, asks the U.S. Bankruptcy Court for the Central District of California to authorize the sale of the real property commonly known as 160 E. Alondra Blvd., Carson, California, APN 6125-015-010, to Robert Sarukhanvan or his assignee, 160 Alondra, LLC, for $950,000, subject to overbid. The Property is a warehouse. It is sometimes referred to as being located in the city of Gardena, California. The Property is currently being leased to Arthur Nazaryan. Under the terms of that lease, Nazaryan pays directly to the existing lender the amount of the monthly mortgage on the Property (inclusive of property taxes). No funds are actually received by the Estate. Under the terms of the Counter Offer, the Buyer of the Property is taking is subject to the existing lease and the tenant's rights of possession. The Debtor scheduled the Property with a value of $1,000,000. After consultation with his real estate agents, the Trustee listed the Property for sale at $950,000. The Trustee entered into an agreement with the Brokers Coldwell Banker and Major Properties Real Estate to obtain assistance in selling the Property. The Brokers marketed the Property and are still marketing the Property for overbids. To date, the Trustee has received only one offer on the Property. That offer is for $950,000 from Mr. Sarukhanvan which offer resulted in the Counter Offer. In connection with the proposed sale, the Trustee anticipates paying the Broker's commission in an amount equal to 5% of the ultimate purchase price (which based on a sale price of $950,000 would total $47,500). Consistent with the Court's order authorizing the Trustee's employment of the Brokers, the Trustee seeks approval to pay the Brokers' commission directly to the Brokers (split among the Brokers and the buyer's agent, if any) through escrow without the need for further order, and further relieving the brokers receiving commissions of any obligation that they may otherwise have to file a fee application. The Trustee also seeks authority to pay through escrow or otherwise, any and all normal and customary fees which include but are not limited to: title fees, escrow agent fees, recording charges, and property taxes. The Trustee's sale of the Property is free and clear of all claims, liens and interests, as set forth in the Motion, including without limitation the following claims, liens or interests which are recorded with the Los Angeles County Recorder: a. general and special taxes and assessments for the fiscal year 2019-2020; b. general and special taxes and assessments for the fiscal year 2018-2019' c. supplemental taxes for the year 2016-2017 assessed pursuant to Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation Code; d. the lien for supplemental taxes, if any, assessed pursuant to Chapter 3.5 commencing with Section 75 of the California Revenue and Taxation Code; e. the deed of trust recorded April 28, 2017 as Instrument Number 17-473429 reflecting a beneficiary of T.D. Service Company, a California Corporation, Velocity Commercial Capital, LLC, a California Limited Liability Company, the beneficial interest of which was assigned of record to U.S. Bank National Association, as Trustee for Velocity Commercial Capital Loan Trust 2018-1 by assignment recorded August 27, 2018 as Instrument Number 18-865274; f. the deed of trust recorded April 28, 2017 as Instrument Number 17-473430 reflecting a beneficiary of Arutyun Yerikyan; g. the lien for unsecured property taxes, evidenced by a certificate recorded by the tax collector of Los Angeles County, recorded Aug. 11, 2017, as Instrument No. 17-908969; and h. notice of pendency of action (and any claim or interest associated therewith) recorded March 27, 2018 as Instrument Number 18-289353 by plaintiff SBK Holdings USA, Inc. To the extent that any portion of a claim, lien or interest in or to the Property is not paid through escrow, such claims(s), lien(s), and interest(s) in and to the Property, will attach to the net sale proceeds. The proposed Sale is subject to overbids as set forth below. The initial deposit made by Sarukhanvan or his assignee is refundable only if the conditions to the sale are not satisfied or Sarukhanvan/his assignee is not the Successful Bidder in the event overbids are received, or if the sale is not approved. The proposed sale will be "as is," "where is," "with all faults," and with no warranties, and the transfer of the Property will be by quitclaim deed. The Trustee has established the following overbid procedures, which he requests govern any bidding: 1. Any person or entity that is interested in purchasing the Property must serve the Trustee and his counsel with an initial bid, such that any Overbid is actually received no later than two days before the commencement of the Auction. The Overbid will be on substantially the same terms as the Counter Offer, or on better terms. 2. Any person or entity that submits a timely, conforming Overbid will be deemed a "Qualified Bidder" and may bid for the Property at the Auction. Unless otherwise permitted by the Court, any entity or person that fails to submit a timely, conforming bid will be disqualified from bidding for the Property. 3. The Trustee, subject to the rights of a Bidder or party in interest to raise an issue with the Court, will have sole authority to determine whether a party is a Qualified Bidder and whether one bid is better than another bid. 4. Any Overbid must remain open until the conclusion of the Auction of the Property to be held at the hearing on the Motion. 5. Any Overbid must provide for a minimum purchase price of at least $25,000 over the sale price of $950,000. Subsequent overbids will be in minimum increments of at least $5,000. 6. Any Overbid must be for the Property "as is," "where is," and "with all faults" and will not contain any financing, due diligence, or any other contingency fee, termination fee, or any similar fee or expense reimbursement. 7. Any Overbid must be accompanied by a deposit of $50,000 in certified funds, which funds will be nonrefundable (absent default by the Trustee) if the Overbid is determined by the Court to be the highest and best bid for the Property, and proof satisfactory to the Trustee that such Bidder has sufficient funds to complete the Sale. 8. Any Overbid must be made by a person or entity who has completed its due diligence review of the Property and is satisfied with the results thereof. 9. If the Trustee receives a timely, conforming Overbid for the Property, the Court will conduct the Auction of the Property at the Sale Hearing, at which all Qualified Bidders may participate. The Auction will be governed by the following procedures: (a) All Qualified Bidders will be deemed to have consented to the core jurisdiction of the Court and to have waived any right to jury trial in connection with any disputes relating to the Auction or the Sale of the Property; (b) the minimum bidding increment during the Auction will be $5,000; (c) bidding will commence at $975,000 (i.e., $25,000 over the Buyer's initial bid of $950,000) or such higher amount if a Qualified Bidder has submitted a higher initial Overbid; and (d) the Court will determine which of the bids is the best bid. The Trustee asks the Court to authorize him to pay through escrow all usual and customary costs of sale, including without limitation (a) brokers' commissions of 5% (totaling approximately $47,500), (b) escrow fees, (c) title insurance fees, (d) recording fees, (e) messenger fees, and (f) liens of record, in each case to the extent not disputed by the Trustee. He also asks authority to pay through escrow (i) the liens of any and all taxing authorities, and (ii) any other liens of record against the Property, in each case to the extent not disputed by the Trustee. To the extent otherwise required to do so, the Trustee asks the Court to relieve the brokers receiving commissions in connection with the proposed sale of any obligation that they may otherwise have had to file fee applications. The Trustee expects his sale of the Property to generate proceeds significantly in excess of the potential liens against the Property estimated as follows: Gross Sales Price $950,000 Brokers' Commissions $ 47,500 Other Costs of Sale, $ 11,726 including tax liens First Priority Lien $447,992 Net to the Estate (subject $442,782 to disputed liens and claims) Finally, the Trustee asks that the Court orders that the Bankruptcy Rule 6004(h) is not applicable, and authorizes the Sale to be effectuated immediately upon entry of the order approving the Motion. A copy of the Agreement and the Bidding Procedures attached to the Notice is available for free at: http://bankrupt.com/misc/Regdalin_Properties_171_Sales.pdf About Regdalin Properties Regdalin Properties, LLC, filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 18-20868) on Sept. 17, 2018, and was represented by Henrik Mosesi, Esq., in Glendale, California. In the petition signed by Edgar Sargysyan, managing member, the Debtor estimated $10 million to $50 million in assets and liabilities. R. Todd Neilson was appointed as the Debtor's Chapter 11 trustee on Nov. 1, 2018. The Trustee retained Dinsmore & Shohl LLP as his legal counsel. RS OLD: Suffern Buying All Assets Nunc Pro Tunc to Sept. 1, 2017 ---------------------------------------------------------------- Suffern Partners, LLC, as an interested party in the Chapter 11 proceeding involving RS Old Mill, LLC, and a defendant in the Debtor's proposed Adversary Proceeding, asks the U.S. Bankruptcy Court for the Southern District of New York (i) to authorize the sale of substantially all of the Debtor's assets to Suffern, nunc pro tunc, to Sept. 1, 2017, for $30 million; (ii) to dismiss the Chapter 11 Case; and (iii) to dismissal and/or abstain as to all claims asserted in the Debtor's proposed Adversary Proceeding Complaint. The Debtor filed the Chapter 11 Case on Feb. 13, 2017 as a DIP, to protect its right under an agreement of sale it entered into as of Nov. 28, 2016 with the Novartis Corp. to purchase approximately 162 acres of land and improvements thereon ("Premises") located in Rockland County for $18 million. The Chapter 11 Case reflected, as the Court noted at a previous hearing, a binary dispute between Novartis and the Debtor over whether the Debtor would assume or reject the Sale Agreement. On June 26, 2017, the Debtor served notice of its intent to assume the Sale Agreement. In an Order dated July 13, 2017, the Court authorized the assumption, deemed the Sales Agreement assumed, and directed the Debtor and Novartis to close within 10 business days. That deadline, however, was extended by the Court until Aug. 17, 2017, due to a dispute between the Debtor and Novartis regarding its alleged interference with the Debtor's efforts to obtain an environmental insurance policy. Various additional complications then arose, including alleged title insurance issues and Novartis' alleged refusal to provide the Debtor access to the Premises to conduct a survey. The Debtor's counsel notified the Court of these disputes in a letter dated Aug. 16, 2017. The Debtor failed to close on the Premises before the Court-ordered deadline, and Novartis deemed the Debtor in default of its obligations under the Sale Agreement by letter dated Aug. 18, 2017. The same day, the Debtor made an emergency motion to enforce the Sale Agreement, which Novartis opposed and followed with its own motion for forfeiture of its $2.5 million down payment in favor of Novartis, to cover its expenses. Separate and apart from the issues between Debtor and Novartis was the Debtor's apparent inability to secure financing for the transaction in a timely manner. By the time of the August 17 closing deadline, the Debtor had not been able to secure financing for the balance due and owing to Novartis under the Sale Agreement, which totaled $15,940,325. Faced with both immediate forfeiture of its $2.5 million deposit and an inability to purchase the Premises, the Debtor identified, structured, implemented, and closed on a series of transactions whereby it was able to purchase the Premises from Novartis, by financing it through an immediate resale at a substantial profit. Ultimately, Suffern paid $30 million for the Premises, which it financed through CPIF Lending, LLC. Specifically, to ensure the Debtor's purchase of the Premises, the Debtor, Suffern, CPIF, and a third-party entity called RS Old Mills Rd, LLC, agreed that the Debtor would transfer the Premises to Old Mills Rd, which would then immediately transfer it to Suffern. The Debtor, Suffern, and CPIF all understood and consented to the multi-transaction structure. On Dec. 16, 2016, Old Mills Rd executed an agreement by which it agreed to sell the Premises to Suffern for $30 million. The Debtor and its newly proposed counsel are not being forthright with the Court. The Debtor sought Chapter 11 relief to protect its right to purchase property located in Rockland County for $18 million, and more importantly, avoid forfeiture of its $2.5 million deposit paid in connection therewith. The Court authorized Debtor to assume the contract and directed the purchase to close. The Debtor, unable to obtain financing for the balance due of $15.5 million and thus faced with the dire risk of losing its $2.5 million deposit, identified, structured, implemented, and closed a series of transactions whereby it purchased and immediately resold the Premises, with the final buyer, Suffern, paying $30 million. The transactions were done in a flurry and closed on an emergency basis in September 2017, without the Court's contemporaneous approval. The transactions saved the Debtor's $2.5 million deposit from being forfeited and resulted in $12 million of additional value upon resale, permitting all creditors to be paid from the transactions' proceeds. Accordingly, part and parcel to the transactions, the Debtor and all creditors signed a proposed Order to dismiss the Chapter 11 Proceeding. Some 18 months after the transactions closed, and while Suffern was in the midst of its efforts to lease the Premises and make it an income-generating property, the Debtor -- by and through its newly proposed counsel -- commenced the Adversary Proceeding that claims the Debtor's own failure to obtain contemporaneous approval should void the very series of transactions that it structured and implemented for its own benefit. The Debtor's proposed Adversary Proceeding is not brought in good faith, but rather, reflects a wasteful and improper effort to have the Court resolve a dispute among the Debtor's equity holders. The Court is not the proper forum for a dispute among equity interests, and the proposed Adversary Proceeding has resulted in a cloud on title to the Premises that Suffern purchased and paid substantial value for in an arms-length deal. The result is that Suffern is being substantially prejudiced -- precluded from being able to lease the Premises to a qualified tenant while incurring $1 million a month to service the Premises' debt and maintenance costs, without any potential for recovery -- all due to an unrelated battle between the Debtor's equity holders. Ultimately, the transactions at issue benefited the Debtor's estate, permitted all valid creditors to be paid, and were designed to permit dismissal of the Chapter 11 Case. The only apparent misstep was a failure to secure the Court's contemporaneous approval of the transactions in the midst of an emergency situation. Accordingly, for the reasons detailed, Suffern now asks that the Court (1) approves the sale transaction and dismiss the Chapter 11 Case; and (2) dismisses and/or abstains from all claims in the Debtor's proposed Adversary Proceeding Complaint, which reflect a fight over equity that does not belong in the Bankruptcy Court. A copy of the Contract of Sale attached to the Motion is available for free at: http://bankrupt.com/misc/RS_Old_86_Sales.pdf About RS Old Mill LLC RS Old Mill, LLC filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case No. 17-22218) on Feb. 13, 2017. The Debtor's assets and liabilities are both below $1 million. The case is assigned to Judge Robert D. Drain. Goldberg Weprin Finkel Goldstein LLP, substituting for Pick & Zabicki LLP, is the Debtor's counsel. SELECTA BIOSCIENCES: Incurs $12.1-Mil. Net Loss in First Quarter ---------------------------------------------------------------- Selecta Biosciences, Inc., filed with the U.S. Securities and Exchange Commission on May 9, 2019, its quarterly report on Form 10-Q reporting a net loss of $12.07 million on $10,000 of grant and collaboration revenue for the three months ended March 31, 2019, compared to a net loss of $15.88 million on $0 of grant and collaboration revenue for the three months ended March 31, 2018. As of March 31, 2019, Selecta Biosciences had $62.48 million in total assets, $47.66 million in total liabilities, and $14.81 million in total stockholders' equity. Research and development expenses for the first quarter of 2019 were $7.4 million, which compares with $11.1 million for the first quarter of 2018. The decrease was driven by reduced salaries and benefits as a result of the Company's headcount reduction at the beginning of the first quarter of 2019 combined with expenses incurred for both the Phase 2 and Phase 3 clinical programs for SEL-212. General and administrative expenses for the first quarter of 2019 were $4.5 million, which compares with $4.7 million for the first quarter of 2018. The reduction in costs was primarily the result of reduced consulting fees. Selecta Biosciences had $48.7 million in cash, cash equivalents, restricted cash and short-term investments as of March 31, 2019, which compares to cash, cash equivalents and restricted cash of $37.7 million at Dec. 31, 2018. Since its inception, the Company has incurred recurring net losses. The Company expects that it will continue to incur losses and that such losses will increase for the foreseeable future. The Company expects that its research and development and general and administrative expenses will continue to increase and, as a result, it will need additional capital to fund its operations, which it may raise through a combination of equity offerings, debt financings, third-party funding and other collaborations and strategic alliances. Selecta Biosciences said, "The future success of the Company is dependent on its ability to develop its product candidates and ultimately upon its ability to attain profitable operations. The Company is subject to a number of risks similar to other early-stage life science companies, including, but not limited to, successful development of its product candidates, raising additional capital with favorable terms, protection of proprietary technology and market acceptance of any approved future products. The successful development of product candidates requires substantial working capital which may not be available to the Company on favorable terms. "To date, the Company has financed its operations primarily through the initial public offering of its common stock, a private placement of its common stock, issuances of common and preferred stock, debt, research grants and research collaborations. "The Company currently has no source of product revenue, and it does not expect to generate product revenue for the foreseeable future. All of its revenue to date has been collaboration and grant revenue. The Company has devoted substantially all of its financial resources and efforts to developing its ImmTOR technology, identifying potential product candidates and conducting preclinical studies and its clinical trials. The Company is in the early stages of development of its product candidates, and it has not completed development of any ImmTOR-enabled therapies." A full-text copy of the Form 10-Q is available for free at: https://is.gd/6khqj7 About Selecta Biosciences Based in Watertown, Massachusetts, Selecta Biosciences, Inc. -- http://selectabio.com/-- is a clinical-stage biotechnology company focused on unlocking the full potential of biologic therapies based on its immune tolerance technology (ImmTOR) platform. Selecta plans to combine ImmTOR with a range of biologic therapies for rare and serious diseases that require new treatment options due to high immunogenicity. The Company's current proprietary pipeline includes ImmTOR-powered therapeutic enzyme and gene therapy product candidates. SEL-212, the Company's lead product candidate, is being developed to treat chronic refractory gout patients and resolve their debilitating symptoms, including flares and gouty arthritis. Selecta's proprietary gene therapy product candidates are in preclinical development for certain rare inborn errors of metabolism and incorporate ImmTOR with the goal of addressing barriers to repeat administration. Selecta Biosciences reported net losses of $65.33 million in 2018, $65.32 million in 2017, and $36.21 million in 2016. Ernst & Young LLP, in Boston, Massachusetts, the Company's auditor since 2009, issued a "going concern" opinion in its report dated March 15, 2019, on the Company's consolidated financial statements for the year ended Dec. 31, 2018, citing that the Company has recurring losses from operations and insufficient cash resources and has stated that substantial doubt exists about the Company's ability to continue as a going concern. SHEFA LLC: Court Upholds Ruling Against Southfield City ------------------------------------------------------- In the case captioned In re SHEFA, LLC, Debtor, CITY OF SOUTHFIELD, Appellant, v. SHEFA, LLC, Appellee, Civil Case No. 18-10073 (E.D. Mich.), District Judge Linda V. Parker affirmed the bankruptcy court's order denying the City of Southfield's motion to compel consummation of Debtor Shefa, LLC's confirmed plan of reorganization. The Court finds that the City has never identified the provision of the Plan or Confirmation Order violated by Debtor's alleged engagement of demolition work without the required permits. At the hearing on the City's motion to compel, the City's attorney instead argued that performing demolition work without obtaining the required permit violated applicable law and, thus, the mortgage the Debtor gave the City pursuant to the settlement. Neither the Plan nor Confirmation Order include a breach of the mortgage terms as an "Event of Default" triggering the remedies set forth therein. Moreover, as the bankruptcy court found, the City never sent a written "Default Notice" to Debtor with respect to this alleged default, which is a precondition to the default--if uncured--becoming an "Event of Default" for which the City could seek the remedies set forth in the Plan and Confirmation Order. As such, the bankruptcy court correctly concluded that this allegation did not entitle the City to the remedies it sought. The Court holds that the bankruptcy court did not abuse its discretion in concluding that the City failed to identify an Event of Default by Debtor entitling the City to the remedies in the Plan and Confirmation Order. As such, the Court finds it unnecessary to decide whether the alternative remedies sought by the City are permissible under section 1142. The bankruptcy court's order is affirmed. A copy of the Court's Opinion and Order dated Feb. 25, 2019 is available at https://bit.ly/2Q1mJeL from Leagle.com. In re Shefa, LLC, Debtor, represented by Robert N. Bassel. City of Southfield, Appellant, represented by Patrick C. Lannen, Plunkett Cooney & Douglas C. Bernstein, Plunkett & Cooney. Daniel M. McDermott, U.S. Trustee, Appellee, represented by David K. Foust, U.S. Department of Justice. Based in Southfield, Miami, Shefa, LLC filed for chapter 11 bankruptcy protection (Bankr. E.D. Mich. Case No. 14-42812) on Feb. 25, 2014, with estimated assets of $500,000 to $1 million and estimated liabilities of $1 million to $10 million. The petition was signed by Sidney Elhadad, principal. SPRINGFIELD LAND: Unsecureds to Get Payment from Property Sale -------------------------------------------------------------- Springfield Land Development LLC filed a Chapter 11 Plan and accompanying Disclosure Statement. The Debtor proposes to sell the Property as soon as reasonably possible. If the Debtor does not procure an enforceable non-contingent contract of sale within 60 days of the Effective Date, the Debtor will sell the Property by auction within 120 days of the Effective Date. Upon the consummation of the plan, the secured debts of HC (Class 1) and Nancy O'Haro (Class 2) and Fairfax County (Class 3) will be paid in full; unsecured claims (Class 4) will be paid in full, without interest. The Debtor will retain any surplus, and the Debtor's owners (Class 5) will retain their interests. All classes are deemed to be "impaired." A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/y4pvnvxv from PacerMonitor.com at no charge. About Springfield Land Development Springfield Land Development LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No. 18-13583) on October 24, 2018. At the time of the filing, the Debtor disclosed that it had estimated assets of $1,000,001 to $10 million and liabilities of $1,000,001 to $10 million. The case has been assigned to Judge Brian F. Kenney. The Debtor tapped the Law Offices of Christopher S. Moffitt as its legal counsel. STEVE SHICKLES, JR: Sets Sales Procedures for 2017 Tiffin Motorhome ------------------------------------------------------------------- Steve Shickles, Jr., and Ronda Shickles ask the U.S. Bankruptcy Court for the Northern District of Alabama to authorize their sale procedures in connection with the sale of a 2017 Tiffin ALLEGRO 34PA Motorhome. The Debtors owned the Motorhome. Also, prepetition they owed Redstone Federal Credit Union approximately $111,835, which is secured by a lien on the Motorhome. They currently have no need to continue owning the Motorhome. They desire to list the Motorhome for sale "as is/where is" and without warranty. The Debtors propose that they be allowed to sell the Motorhome pursuant to 11 U.S.C. Section 363(f) of the Bankruptcy Code. They further propose that they not be required to obtain further Orders from the Court so long as the Motorhome is sold for a price not less than $130,000. The Debtors desire to sell the Motorhome free and clear of all liens, claims, interests, and encumbrances. Additionally, the Debtors will file a report with the Court upon the sale of the Motorhome. The report will contain the name of the buyer and the amount paid for the Motorhome. Under no circumstances will the Debtors sell the Motorhome to an insider or affiliate. Furthermore, all sale proceeds will be deposited into the Examiner's account at Progress Bank. The Debtors submit that a good business justification supporting this sale exists. The relief requested by Debtors is in the best interests of the Estate and its creditors because this type of asset needs to be sold at a price, which represents the value of the property to be sold and brings cash equity to the Estate. The sale also reduces expenses by eliminating unnecessary insurance and storage fees. Finally, they ask that any Order approving the sale be effective upon entry and that the stay provisions under Rule 6004(h) not apply. Steve Shickles, Jr., and Ronda Shickles sought Chapter 11 protection (Bankr. N.D. Ala. Case No. 19-80155) on Jan. 17, 2019. The Debtor tapped Angela Stewart Ary, Esq., and Kevin D. Heard, Esq., at Heard, Ary & Dauro, LLC, as counsel. STEVE SHICKLES, JR: Sets Sales Procedures for 2018 BMW M4 --------------------------------------------------------- Steve Shickles, Jr., and Ronda Shickles ask the U.S. Bankruptcy Court for the Northern District of Alabama to authorize their sale procedures in connection with the sale of a 2018 BMW M4. The Debtors owned the BMW. Also, prepetition they owed BMW Bank of North America approximately $23,892, which is secured by a lien on the BMW. They currently have no need to continue owning the BMW. The Debtors desire to list the BMW for sale "as is/where is" and without warranty. The Debtors propose that they be allowed to sell the BMW pursuant to 11 U.S.C. Section 363(f) of the Bankruptcy Code. They further propose that they not be required to obtain further Orders from the Court so long as the BMW is sold for a price not less than 10% of its market value of $55,000. The Debtors desire to sell the BMW free and clear of all liens, claims, interests, and encumbrances. Additionally, the Debtors will file a report with the Court upon the sale of the BMW. The report will contain the name of the buyer and the amount paid for the BMW. Under no circumstances will the Debtors sell the BMW to an insider or affiliate. Furthermore, all sale proceeds will be deposited into the Examiner's account at Progress Bank. The Debtors submit that a good business justification supporting the sale exists. The relief requested by the Debtors is in the best interests of the Estate and its creditors because this type of asset needs to be sold at a price, which represents the value of the property to be sold and brings cash equity to the Estate. The sale also reduces expenses by eliminating unnecessary insurance and storage fees. Finally, they ask that any Order approving the sale be effective upon entry and that the stay provisions under Rule 6004(h) not apply. Steve Shickles, Jr., and Ronda Shickles sought Chapter 11 protection (Bankr. N.D. Ala. Case No. 19-80155) on Jan. 17, 2019. The Debtor tapped Angela Stewart Ary, Esq., and Kevin D. Heard, Esq., at Heard, Ary & Dauro, LLC, as counsel. STONEMOR PARTNERS: Reports Q1 Net Loss of $22.5 Million ------------------------------------------------------- StoneMor Partners L.P. filed with the U.S. Securities and Exchange Commission on May 10, 2019, its quarterly report on Form 10-Q reporting a net loss of $22.53 million on $71.46 million of total revenues for the three months ended March 31, 2019, compared to a net loss of $17.92 million on $77.94 million of total revenues for the three months ended March 31, 2018. As of March 31, 2019, the Company had $1.72 billion in total assets, $1.75 billion in total liabilities, and a total partners' deficit of $28.83 million. Net cash used in operating activities was $13.1 million during the quarter ended March 31, 2019, a change of $19.3 million from $6.2 million in net cash provided by operating activities during the quarter ended March 31, 2018. The $19.3 million unfavorable movement resulted from $13.7 million net cash outflow to fund changes in working capital and a $5.6 million increase in net loss excluding non-cash items. The increase in net working capital was primarily the result of managing the Company's working capital through an increased focus on collection of accounts receivable. The increase in net loss excluding non-cash items was due to a decrease in revenues coupled with increased general and administrative expense due to increased consulting and professional fees resulting from the potential C-Corp conversion and due to various changes in the Company's senior management. Net cash used in investing activities was $1.9 million during the quarter ended March 31, 2019, a decrease of $3.3 million from $5.2 million during the quarter ended March 31, 2018. Net cash used in investing activities during 2019 consisted of $1.9 million for capital expenditures. The decrease was primarily attributable to a $2.5 million decrease in capital expenditures compared to the quarter ended March 31, 2018, which included $1.4 million related to the construction of a funeral home on an existing cemetery location. In addition the prior year had a use of cash of $0.8 million related to acquisitions. Net cash provided by financing activities was $21.3 million for the quarter ended March 31, 2019, an increase of $18.7 million from $2.6 million for the quarter ended March 31, 2018. Net cash provided by financing activities during 2019 was driven by proceeds from long-term debt of partially offset by financing costs incurred of $2.6 million. StoneMor said, "While the Partnership relies heavily on its cash flows from operating activities and borrowings under its credit facility to execute its operational strategy and meet its financial commitments and other short-term financial needs, the Partnership cannot be certain that sufficient capital will be generated through operations or available to the Partnership to the extent required and on acceptable terms. Moreover, although the Partnership's cash flows from operating activities have been positive, the Partnership has experienced negative financial trends which, when considered in the aggregate, raise substantial doubt about the Partnership's ability to continue as a going concern." These negative financial trends include: * the Partnership has continued to incur net losses for the three months ended March 31, 2019 and has an accumulated deficit as of March 31, 2019, due to an increased competitive environment, increased expenses due to the proposed conversion of the Partnership to a C-corporation and increases in professional fees and compliance costs. * a decline in billings coupled with the increase in professional, compliance and consulting expenses, tightened the Partnership's liquidity position and increased reliance on long-term financial obligations, which, in turn, eliminated the Partnership's ability to pay distributions; * the Partnership's failure to comply with certain covenants of its Credit Agreement, as amended due to its prior inability to complete timely filings of its Annual Reports on Form 10-K and Quarterly Reports on Form 10-Q, exceeding the maximum consolidated leverage ratio financial covenant for the periods ended Dec. 31, 2017 and March 31, 2018, exceeding the maximum consolidated secured net leverage ratio financial covenant for the periods ended June 30, 2018, Sept. 30, 2018 and Dec. 31, 2018 and not being able to achieve the minimum consolidated fixed charge coverage ratio for the periods ended June 30, 2018, Sept. 30, 2018 and Dec. 31, 2018. "If the Partnership's planned and implemented actions are not completed and cash savings realized and the Partnership fails to improve its operating performance and cash flows, or the Partnership is not able to comply with the covenants under its amended credit facility, the Partnership may be forced to limit its business activities, implement further modifications to its operations, further amend its credit facility and/or seek other sources of capital, and the Partnership may be unable to continue as a going concern. Additionally, a failure to generate additional liquidity could negatively impact the Partnership's access to inventory or services that are important to the operation of the Partnership's business," added StoneMor. A full-text copy of the Form 10-Q is available for free at: https://is.gd/e5t5sc About StoneMor Partners StoneMor Partners L.P., headquartered in Trevose, Pennsylvania -- http://www.stonemor.com/-- is an owner and operator of cemeteries and funeral homes in the United States, with 322 cemeteries and 90 funeral homes in 27 states and Puerto Rico. StoneMor's cemetery products and services, which are sold on both a pre-need (before death) and at-need (at death) basis, include: burial lots, lawn and mausoleum crypts, burial vaults, caskets, memorials, and all services which provide for the installation of this merchandise. StoneMor reported a net loss of $72.69 million for the year ended Dec. 31, 2018, compared to a net loss of $75.15 million for the year ended Dec. 31, 2017. As of Dec. 31, 2018, the Partnership had $1.66 billion in total assets, $1.67 billion in total liabilities, and a total partners' deficit of $6.57 million. * * * As reported by the TCR on Feb. 13, 2019, Moody's Investors Service downgraded StoneMor Partners L.P.'s Corporate Family rating to Caa2 from Caa1 and Probability of Default rating to Caa3-PD from Caa1-PD. The Caa2 CFR reflects Moody's concern that if pre-need cemetery selling and liquidity pressures do not abate while the senior secured credit facility is being refinanced, a distressed exchange or other default event could become more likely. In February 2019, S&P affirmed its 'CCC+' issuer credit rating on StoneMor Partners. S&P said, "The rating affirmation reflects our view that StoneMor's capital structure is unsustainable and reflects our expectation that the company will produce cash flow deficits in 2019. However, we affirmed the rating because we believe the company has sufficient liquidity over the next 12 months given the new bridge loan." SUNGARD AVAILABILITY: Prepackaged Plan Declared Effective --------------------------------------------------------- On May 2, 2019, the United States Bankruptcy Court for the Southern District of New York entered an order approving the Disclosure Statement for the Joint Prepackaged Plan of Reorganization of Sungard Availability Services Capital, Inc., and its debtor affiliates, and confirmed the Joint Prepackaged Plan of Reorganization (As Modified). On May 3, 2019, the Bankruptcy Court, entered an amended order approving the Disclosure Statement and confirming the Plan. The Effective Date of the Plan occurred on May 3, 2019. Holders of Allowed General Unsecured Claims will, at the option of the Debtors (with the consent of the Required Consenting Creditors) or Reorganized Debtors, as applicable, (i) have such Claims Reinstated, (ii) be paid in full in Cash in the ordinary course of business, or (iii) be otherwise rendered Unimpaired; provided that subject to, and upon the occurrence of, the Effective Date, the Sponsors, in their capacities as such, shall be deemed to have waived all General Unsecured Claims (including any claims for accrued and unpaid management fees payable by the Debtors) other than any claims, rights or defenses arising under or related to any Indemnification Provisions or any D&O Liability Insurance Policies, which shall be fully preserved. The Debtors shall fund distributions under the Plan with: (a) Cash on hand, including cash from operations and proceeds from the DIP Facility; (b) the Exit Facilities and the loans thereunder; and (c) the New Sungard AS Equity. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/yypcv228 from PacerMonitor.com at no charge. About Sungard Availability Services Sungard Availability Services ("Sungard AS") -- http://www.sungardas.com-- is a provider of critical production and recovery services to global enterprise companies. Sungard AS partners with customers across the globe to understand their business needs and provide production and recovery services tailored to help them achieve their desired business outcomes. Leveraging more than 40 years of experience, Sungard AS designs, builds and runs critical IT services that help customers manage complex IT, adapt quickly and build resiliency and availability. SUPERCLEAN ENTERPRISES: Swonger Buying Customer List for $5K ------------------------------------------------------------ Superclean Enterprises, Inc., asks the U.S. Bankruptcy Court for the Western District of Arkansas to authorize the sale of its customer list to Ryan Swonger, doing business as Elite Cleaners, for $5,000. The terms of sale are (1) approval of the proposed sale by Bankruptcy Court Order, (2) cash to the Debtor or the Debtor's successor within 14 days of the entry of an order approving the sale, and that (3) such sale will be free and clear of all liens, encumbrances and interests. The Debtor affirmatively states that the sale is in the best interests of the Debtor, the estate and its creditors, and that the price offered is the highest and best price for the customer list. A Notice is given that during the notice period for the Motion, the Proposed Buyer will be assisting the Debtor in closing its stores and returning customer bailments and collecting money for the Debtor for deposit into the DIP bank accounts for the benefit of the Debtor's creditors in a chapter 7 estate. The Debtor has filed a motion to convert its case to chapter 7 such motion being filed on April 2, 2019. The Purchaser: Ryan Swonger 81 South Church Ave. Fayetteville, AK 72701 About Superclean Enterprises Superclean Enterprises, Inc. sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Ark. Case No. 18-72176) on Aug. 16, 2018. At the time of the filing, the Debtor estimated assets of less than $500,000 and liabilities of less than $500,000. T & S SUBS: June 20 Plan Confirmation Hearing --------------------------------------------- The disclosure statement of T & S Subs, LLC, has been conditionally approved, and the disclosure and confirmation hearings will be combined. June 20, 2019 at 10:00 AM is fixed for the hearing on final approval of the disclosure statement,, and for the hearing on confirmation of the plan and related matters at Jasper County Courthouse, Carthage Courtroom Div VI, 302 S. Main, Carthage, MO. May 29, 2019 is the deadline for: A. Filing with the Court objections to the disclosure statement or plan confirmation; and B. Submitting to counsel for the plan proponent ballots accepting or rejecting the plan. About T & S Subs T & S Subs, LLC, owns and operates a convenience store in Neosho, Missouri. T & S Subs filed a Chapter 11 petition (Bankr. W.D. Mo. Case No. 18-30526) on Sept. 17, 2018. In the petition signed by Robert T. Aggus, owner, the Debtor estimated $0 to $50,000 in assets and $100,001 to $500,000 in liabilities. The Debtor tapped Collins, Webster, & Rouse, PC, as its legal counsel. TITANIUM HOLDING: Griffin Buying Ocean City Property for $265K -------------------------------------------------------------- Titanium Holding, LLC, asks the U.S. Bankruptcy Court for the District of Maryland to authorize the sale of the real property located at 9400 Coastal Highway, Unit 1101, Ocean City/Worcester, Maryland to Arisha Griffin for $265,000, all cash. The Debtor is the owner of the Property. It values the Property at $265,000. Zillow.com estimates the value of a condominium unit comparable to the Property at $262,494. It has received an offer to purchase the Property from the Buyer for the agreed all cash purchase price. Said offer was presented to the Debtor in the form of a Contract. An earnest money deposit of $2,650 has been placed in anticipation of closing on the purchase under the Contract. It appears that the Property is encumbered by a Deed of Trust securing the claim of Melanchthom Mench, in the approximate amount of $220,000. It is the Debtor's intention to pay this claim in full at closing (the claim of Mr. Mench is cross-collateralized with another realty asset of the Debtor, which will be the subject of a separate motion). It appears that a proposed purchase price of $265,000 represents fair market value, if not more than such value. The Debtor believes, and therefore avers, that the sale will simplify the case, alleviate the estate of the burden of carrying and maintaining the Property, and resolve some creditors' claims promptly. Thus, the proposed sale should be approved, and the Debtor should be authorized to do all things reasonably necessary to consummate the sale proposed. A copy of the Contract attached to the Motion is available for free at: http://bankrupt.com/misc/Titanium_Holding_18_Sales.pdf About Titanium Holding Titanium Holding LLC sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 19-13595) on March 18, 2019. At the time of the filing, the Debtor estimated assets of less than $1 million and liabilities of the same range. The case is assigned to Judge Wendelin I. Lipp. The Law Offices of Jeffrey M. Sherman is the Debtor's counsel. TODD'S CAR WASH: Unsecured Creditors to Get $2K Per Month --------------------------------------------------------- Todd's Car Wash, LLC, filed a Combined Plan and Disclosure Statement. Class 2 - Unsecured Claims. All allowed unsecured claims will be paid a pro-rata portion of $2,101.99 per month until all allowed non-insider unsecured claims are paid in full. The first payment will be due on the Effective Date and subsequent payments will be made on the first day of each month thereafter. The payments will be completed in five years. The payments listed on Attachment A assume that amount listed on the creditor's proof of claim is accurate for undisputed claims and that all disputed claims are disallowed or paid by insurance proceeds. If any disputed claim is allowed and not paid by insurance proceeds, then that creditor will receive a pro rata share of $2,101.99 per month and the payments on all other allowed claims will be reduced accordingly. Based on undisputed non-insider unsecured claims not covered by insurance proceeds of $126,119.42, these payments will result in a 100% dividend to unsecured creditors. Class 1 - Secured Claim of Pedestal Bank ("Pedestal") are impaired. Pedestal has a secured claim against the Debtor in the approximate amount of $1,165,219.62. This claim is secured by security interest in all of the Debtor's real estate, equipment, and inventory. Pedestal's claim will be treated as fully secured. Todd's will pay the full balance of its claim no later than October 31, 2019, by obtaining a refinance of its debt. During the time period between confirmation of this Plan and the time the loan is refinanced, Todd's will continue to make adequate protection payments to Pedestal in the amount of $10,000.00 per month and the provisions of adequate protection order entered on March 6, 2019, shall remain in full force and effect. Class 3 - Shareholder Interests - Lemaire will retain his ownership interests in the reorganized Debtor. Todd's believes that it will have sufficient income from the operations of the car washes to make its payment to all creditors. A full-text copy of the Disclosure Statement dated May 1, 2019, is available at https://tinyurl.com/yxu876uw from PacerMonitor.com at no charge. About Todd's Car Wash Todd's Car Wash, LLC is a privately-held company in Lafayette, Louisiana, engaged in car washing and polishing. It is the fee simple owner of a real property located at 5505 Johnston Street, Lafayette, Louisiana, valued by the company at $1.3 million. Todd's Car Wash sought protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D. La. Case No. 18-50764) on June 21, 2018. In the petition signed by Todd Lemaire, member, the Debtor disclosed $1.64 million in assets and $1.44 million in liabilities. Judge Robert Summerhays presides over the case. URUS GROUP: Secured Judgment Creditors Object to Plan Disclosures ----------------------------------------------------------------- Gus Goldsmith and U.S. Trust Company of Delaware, as trustee for Phillip M. Greenberg Irrevocable Trust, secured judgment creditors, file a limited objection to the Combined Disclosure Statement and Chapter 11 Plan of Urus Group LLC. According to the Secured Creditors, it leaves unclear whether the hearing on the Debtor's Disclosure Statement and Plan currently scheduled for May 8, 2019 and the attendant deadline for objections to the Disclosure Statement, one week prior or May 1, 2019, remain in full force and effect. The Secured Creditors object to the Disclosure Statement and the Reorganization Plan unless and until these are modified to reflect the unimpaired nature of the claims of the Secured Creditors and exclude the real property asserted by the Secured Creditors to belong to the them, not the Debtor. Counsel for Gus Goldsmith and U.S. Trust Company of Delaware, as Trustee for Phillip M. Greenberg Irrevocable Trust: Carmen Contreras-Martinez, Esq. SAUL EWING ARNSTEIN & LEHR LLP 200 S. Biscayne Boulevard, Suite 3600 Miami, FL 33131 Telephone: 305-428-4500 E-mail: phil.hudson@saul.com carmen.contreras-martinez@saul.com About Urus Group LLC Urus Group LLC is a privately-held company whose principal assets are located at 2627 South Bayshore Drive, Miami, Florida. Urus Group sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 18-24730) on Nov. 27, 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. The case is assigned to Judge Jay A. Cristol. The Debtor tapped Richard Siegmeister P.A. as its legal counsel. WEATHERFORD INT'L: Moody's Cuts CFR to Ca Amid RSA with Noteholders ------------------------------------------------------------------- Moody's Investors Service downgraded Weatherford International Ltd.'s (Bermuda) (Weatherford, a Bermuda incorporated entity) Corporate Family Rating to Ca from Caa2 and Probability of Default Rating to Ca-PD from Caa2-PD. Moody's also downgraded the senior unsecured notes of both Weatherford and Weatherford International, LLC (Delaware) (Weatherford LLC, incorporated in Delaware) to Ca from Caa3. Weatherford's SGL-4 Speculative Grade Liquidity Rating was affirmed. The outlook remains negative. "These downgrades follow Weatherford's May 10, 2019 announcement that it has entered into a restructuring support agreement (RSA) with the majority of holders of its senior unsecured notes, which contemplates implementing a financial restructuring through a prepackaged Chapter-11 plan of reorganization under the US Bankruptcy Code," said Sajjad Alam, Moody's Senior Analyst. Downgraded: Issuer: Weatherford International Ltd. (Bermuda) Corporate Family Rating, Downgraded to Ca from Caa2 Probability of Default Rating, Downgraded to Ca-PD from Caa2-PD Senior Unsecured Notes, Downgraded to Ca (LGD4) from Caa3 (LGD4) Senior Unsecured Shelf, Downgraded to (P)Ca from (P)Caa3 Subordinate Shelf, Downgraded to (P)C from (P)Ca Preferred Shelf, Downgraded to (P)C from (P)Ca Preference Shelf, Downgraded to (P)C from (P)Ca Issuer: Weatherford International, LLC (Delaware) Senior Unsecured Notes, Downgraded to Ca (LGD4) from Caa3 (LGD4) Senior Unsecured Shelf, Downgraded to (P)Ca from (P)Caa3 Subordinate Shelf, Downgraded to (P)C from (P)Ca Affirmed: Issuer: Weatherford International Ltd. (Bermuda) Speculative Grade Liquidity Rating, Affirmed SGL-4 Senior Unsecured Commercial Paper, Affirmed NP Outlook actions: Issuer: Weatherford International Ltd. (Bermuda) Outlook, Remains Negative Issuer: Weatherford International, LLC (Delaware) Outlook, Remains Negative RATINGS RATIONALE Weatherford's Ca CFR reflects its high probability of default and Moody's estimates around potential recoveries for creditors in the event of a restructuring. The company has an unsustainable capital structure relative to its cash flow prospects with roughly $8.9 billion of total adjusted debt and over $600 million in annual interest expense. The company is also facing over $3 billion of debt maturities through 2021 in a challenged and slowly improving industry environment. The company's extensive ongoing business transformation initiatives will continue to present elevated execution risk. Additionally, the company will face reduced liquidity from the expiration of roughly two-thirds of its revolver commitment early in the third quarter of 2019. Weatherford has weak liquidity based on its upcoming debt maturities, which is reflected in the SGL-4 rating. As of March 31, 2019, the company had $598 million of cash and only $93 million in available borrowing capacity under revolving credit facilities that had a combined commitment amount of $846 million. The company will have only $303 million of revolver commitment after August 15, 2019, and that remaining commitment will expire on July 13, 2020. Moreover, Weatherford will have a $250 million term loan due and a $364 million bond maturity in 2020, and is facing $2 billion of bond maturities in 2021. The negative outlook reflects the high and imminent risk of a bankruptcy filing. Weatherford's PDR will be downgraded to D if the company files for bankruptcy. Ratings are unlikely to be upgraded in the near future absent material debt reduction. The Ca rating on the senior unsecured notes reflects Moody's recovery estimates for noteholders in the event of a default, which is likely to be in the 35%-65% range. The unsecured notes of Weatherford and Weatherford LLC are contractually and structurally subordinated to Weatherford's credit facilities, including the term loan. Weatherford's credit facilities have upstream guarantees from a material portion of its operating and holding company subsidiaries. The term loan has a first lien security on a substantial portion of Weatherford's assets and the $317 million 364-day revolver has a second-lien claim. Neither the unsecured notes of Weatherford nor Weatherford Delaware benefit from upstream guarantees from operating subsidiaries, where nearly all of the consolidated company's assets, leases, and non-debt liabilities reside. Weatherford International Ltd. (Bermuda) and Weatherford International, LLC (Delaware) are wholly-owned subsidiaries of Weatherford International plc, which is headquartered in Switzerland and is a diversified international company that provides a wide range of services and equipment to the global oil and gas industry. WESTERN RESERVE: Watersurplus Buying Personal Property for $260K ---------------------------------------------------------------- Western Reserve Water Systems, Inc. asks the U.S. Bankruptcy Court for the Northern District of Ohio to authorize the sale of interest in the personal property described in the Purchase Order to Watersurplus/Surplus Management, Inc. for $260,000. KeyBank has a blanket lien on all property being sold. he parties believe the sale price represents fair market value for the property. It is in the best interest of the estate that the property be sold free and clear of liens and encumbrances. In order to provide adequate protection to the interests of KeyBank, the Buyer will deposit in its DIP Account the funds necessary to complete the transaction pending agreement as to their distribution. A copy of the Purchase Order is available for free at: http://bankrupt.com/misc/Western_Reserve_14_Sales.pdf The Purchaser: WATERSURPLUS/SURPLUS MANAGEMENT, INC. 726 Beacon Street Loves Park, IL 61111 Telephone: (800) 919-0888 Facsimile: (815) 636-8833 About Western Reserve Water Systems Western Reserve Water Systems, Inc. -- http://www.westernreservewater.com/-- is an industrial water service company offering a wide range of equipment, services, parts, and consulting services for the industrial process water and high purity water user. Western Reserve Water Systems services are supplied to various industries, such as power generation, chemical processing, auto, steel, food & beverage, pharmaceutical, hospital, medical, laboratory and light industrial and commercial markets. The Company's service center and regeneration facility is currently located in Cleveland, Ohio, with satellite service locations in Cincinnati, Ohio, and Terre Haute, Indiana. Western Reserve Water Systems, Inc. sought Chapter 11 protection (Bankr. N.D. Ohio Case No. 19-11864) on April 1, 2019. The case is assigned to Judge Jessica E. Price Smith. In the petition signed by Michael Eiermann, president, the Debtor disclosed total assets at $10,285,282 and $4,306,486 in total debt. The Debtor tapped Glenn E. Forbes, Esq., at Forbes Law, LLC, as counsel. WILL NELSON: $230K Sale of Nesbit Property to Honnoll Approved -------------------------------------------------------------- Judge Paulette J. Delk of the U.S. Bankruptcy Court for the Western District of Tennessee authorized J. Nelson and Hattie N. Nelson to sell the real property located at 3889 N. Robertson Road, Nesbit, Mississippi, more particularly described by the Warranty Deed conveying the properties to Will J. Nelson and Hattie Nelson as tenants by the entirety, which is recorded at Book 157, Page 313 with the DeSoto County Chancery Clerk's Office, bearing DeSoto County Tax Assessor's Parcel ID No. 2085150000000201, to John Andrew Honnoll and Norizela Montiel de Honnoll for $230,000. At closing, the Debtors will satisfy the senior mortgage held in favor of First Tennessee Bank in the approximate amount of $94,053. Also, at closing, they will pay all outstanding DeSoto County real property taxes for the property, totaling approximately $6,418 for the 2016 through 2018 tax years, and closing costs. Due to a discrepancy as to the identity of the holder of the second mortgage on the property and the payoff amount needed to satisfy said second mortgage, and as to the claim of Great American Insurance Company for the net proceeds under its third mortgage on the property, the closing attorney will pay into the Bankruptcy Court Clerk's Office the sales proceeds at closing, which is net of the payoff to First Tennessee Bank for the first mortgage, DeSoto County Chancery Court for the real estate taxes owed on the property for the 2016 through 2018 tax years, and all closing costs. The Bankruptcy Court Clerk of Court will hold said net proceeds in registry until further Order(s) of the Court determining the ultimate disposition of the funds. All liens and other encumbrances not satisfied at the closing on the property will survive the closing and attach to the net proceeds held by the Bankruptcy Court Clerk's Office until further Court Order(s). The Counsel for the Debtors will enter a separate, later in time Order reflecting the exact amount of net proceeds to be distributed and held by the Bankruptcy Court Clerk's Office in registry. Immediately following, and conditioned upon the closing, First Tennessee Bank will release the Deed of Trust secured by the property registered with the Desoto County Chancery Clerk at Book 1424, Page 652, as modified at Book 2182, Page 606. Conditioned upon the payment of all real estate taxes and the release of the respective Deed of Trust held in favor of First Tennessee Bank as set forth above, the purchaser will take title to 3889 Robertson Road, Nesbit, Mississippi 38651 free and clear of all liens and encumbrances and any junior liens and encumbrances that remain after closing will attach only to the net proceeds held by the Bankruptcy Court Clerk’s Office until further Court Order(s). Pursuant to Rule 4001(3) of the Bankruptcy Code, the 14-day relief from the automatic stay from the date of the entry of the Order is waived. The case is In re Will J. Nelson and Hattie N. Nelson (Bankr. W.D. Tenn. Case No. 17-20831). WILLIAM SABOL: Agritainment Buying Saint Paul Property for $1.6M ---------------------------------------------------------------- William Darwin Sabol asks the U.S. Bankruptcy Court for the District of Oregon to authorize the short sale of the real property commonly referred to as 21465 Arbor Grove Rd NE, Saint Paul, Oregon to Agritainment, Inc., for $1,610,810. Objections, if any, must be filed no later than 14 days after the service date. The Buyer was first located through an RMLS listing of the home. His offer was rejected. Over five months after the home was taken off the market, the Buyer through a mutual business contact started negotiating with the Debtor. There are no executory contracts involved in the transaction, except the purchase and sale agreement. However, the parties have discussed a separate possible lease related to approximately 30 acres of farm land at the real property that is not needed for the Buyer's future orchard operation. No agreement has been reached at this time. This is disclosed for transparency but any potential lease is not related to or required by the sale agreement. There are no releases, waivers or non-economic benefits to insiders contemplated by the transaction. No avoidance actions are sold or compromised by the Debtor's intended action. The sale was obtained by private negotiation. Prior to the private negotiations, the home was exposed to the market after an RMLS listing for approximately the nine months at $1.8 million. During the listing the highest and best offer was $1.4 million. The private sale is $1,610,810. The GP, LLC mortgage lien is alleged to be over $2.1 million. This is a short sale with GP's consent. All ordinary costs of sale will be paid by buyer, exclusive of Attorney Fees and UST fees. The sale price includes all real estate taxes. The Closing is expected to occur as soon as possible. The Buyer wanted a 7-15 day close. The Closing will occur immediately after the notice period for this Notice and issuance of an Order. The Buyer has agree to deposit $10,000 in earnest money. There are no interim agreements. The proceeds will be used as follows: Payment to Marion County for property taxes of $10,810 and $1.6 million net to GP. The sale will be free and clear of liens and subject to a good faith finding under 363(m). The sale is a short sale. Finally, the Debtor asks that FRBP 6004(h) be waived to allow the sale to close as soon as practicable. The Buyer needs to take possession as soon as possible to begin spring planting. A copy of the Agreement attached to the Motion is available for free at: http://bankrupt.com/misc/William_Sabol_223_Sales.pdf The Purchaser: AGRITAINMENT, INC. 17305 NE Leander Drive Sherwood, OR 97140 Attn: Jeffery D. Jones E-mail: jeff@americannurseryservices.com - and - David M. Blair P.O. Box 3241 Tualatin, OR 97062 The Purchaser is represented by: K&L GATES LLP One SW Columbia Street, Suite 1900 Portland, OR 97258 Attn: Shane T. Devins, Esq. E-mail: shane.devins@klgates.com The Chapter 11 case is In re William Darwin Sabol (Bankr. D. Ore. Case No. 18-61930-tmb11). WINDSTREAM HOLDINGS: Committee Taps Morrison & Foerster as Counsel ------------------------------------------------------------------ The official committee of unsecured creditors of Windstream Holdings, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Morrison & Foerster LLP as its legal counsel. The firm will advise the committee of its powers and duties under the Bankruptcy Code; represent the committee in its negotiations with creditors and consultations with the Debtor; analyze the conduct of the Debtors' affairs; assist the committee in any potential sale of the Debtors' assets; review any proposed bankruptcy plan; and provide other legal services in connection with the Debtors' Chapter 11 cases. The firm's hourly rates are: Partners $925 - $1,750 Of Counsel/Senior of Counsel $595 - $1,500 Attorneys/Associates $510 - $895 Paraprofessionals $255 - $460 Lorenzo Marinuzzi, Esq., a partner at Morrison, disclosed in court filings that his firm is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, Mr. Marinuzzi disclosed that his firm has not agreed to a variation of its standard or customary billing arrangements for its employment with the committee, and that no Morrison professional has varied his rate based on the geographic location of the Debtors' bankruptcy cases. The attorney also disclosed that his firm has not represented the committee prior to the Debtors' bankruptcy filing. The committee has already approved the firm's prospective budget and staffing plan for the first interim period, according to Mr. Marinuzzi. Morrison can be reached through: Lorenzo Marinuzzi, Esq. Todd M. Goren, Esq. Jennifer L. Marines, Esq. Erica J. Richards, Esq. Morrison & Foerster LLP 250 West 55th Street New York, NY 10019 Telephone: (212) 468-8000 Facsimile: (212) 468-7900 E-mail: tgoren@mofo.com jmarines@mofo.com erichards@mofo.com lmarinuzzi@mofo.com About Windstream Holdings Windstream Holdings, Inc. and its subsidiaries are providers of advanced network communications and technology solutions for businesses across the United States. They also offer broadband, entertainment and security solutions to consumers and small businesses primarily in rural areas in 18 states. Windstream Holding Inc. and its subsidiaries filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25, 2019. The Debtors had total assets of $13,126,435,000 and total debt of $11,199,070,000 as of Jan. 31, 2019. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as counsel; PJT Partners LP as financial advisor and investment banker; Alvarez & Marsal North America LLC as restructuring advisor; and Kurtzman Carson Consultants as notice and claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on March 12, 2019. The committee tapped Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP as its financial advisor, and Perella Weinberg Partners LP as investment banker. WINDSTREAM HOLDINGS: Committee Taps Perella as Investment Banker ---------------------------------------------------------------- The official committee of unsecured creditors of Windstream Holdings, Inc., seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to hire an investment banker. The committee proposes to employ Perella Weinberg Partners LP to provide these services in the Chapter 11 cases of Windstream and its affiliates: (a) advise the committee regarding the business, operations, liquidity situation, assets and liabilities, financial condition and prospects of the Debtors; (b) review and report to the committee with respect to the Debtors' financial condition and outlook; (c) evaluate the Debtors' debt capacity in light of projected cash flows; (d) analyze any valuation of the Debtors or their assets; (e) analyze any proposed capital structure for the Debtors; (f) attend meetings with the committee related to the Debtors as well as due diligence meetings with the Debtors or other third parties; (g) assist in the committee's evaluation of the Debtors' near-term liquidity including various financing alternatives; (h) advise the committee of the existing debt structure of the Debtors and refinancing alternatives to existing debt; (i) explore alternative strategies for the Debtors and their assets as a standalone business; (j) develop, evaluate and assess the financial issues and options concerning any proposed transaction; (k) analyze and explain any transaction to the committee; and (l) participate in negotiations with the Debtors on behalf of the committee. Perella will receive a $7.5 million fee, payable promptly upon consummation of a transaction. Moreover, the firm will be paid a monthly fee of $225,000, prorated for each partial month. Fifty percent of all monthly fees beginning with the seventh monthly fee payment will be credited against the transaction fee. Bruce Mendelsohn, a partner at Perella's Restructuring group, disclosed in court filings that his firm is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Bruce Mendelsohn Perella Weinberg Partners LP 767 5th Avenue New York, NY 10153 Phone: 212.287.3200 About Windstream Holdings Windstream Holdings, Inc. and its subsidiaries are providers of advanced network communications and technology solutions for businesses across the United States. They also offer broadband, entertainment and security solutions to consumers and small businesses primarily in rural areas in 18 states. Windstream Holding Inc. and its subsidiaries filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25, 2019. The Debtors had total assets of $13,126,435,000 and total debt of $11,199,070,000 as of Jan. 31, 2019. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as counsel; PJT Partners LP as financial advisor and investment banker; Alvarez & Marsal North America LLC as restructuring advisor; and Kurtzman Carson Consultants as notice and claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on March 12, 2019. The committee tapped Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP as its financial advisor, and Perella Weinberg Partners LP as investment banker. WINDSTREAM HOLDINGS: Taps Alvarez & Marsal as Financial Advisor --------------------------------------------------------------- Windstream Holdings, Inc., received approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Alvarez & Marsal North America, LLC as its financial advisor. The firm will provide these restructuring support services to the company and its affiliates in connection with their Chapter 11 cases: (a) assist the Debtors in the preparation of financial-related disclosures required by the court, including schedules of assets and liabilities, statements of financial affairs and monthly operating reports; (b) provide information and analyses required pursuant to the debtor-in-possession financing; (c) assist in the identification and implementation of short-term cash management procedures; (d) provide advisory assistance in connection with the development and implementation of key employee compensation and other critical employee benefit programs; (e) assist in identifying executory contracts and leases and perform evaluations to support the Debtors' analysis and decision to assume or reject each contract and lease; (f) assist the Debtors' management team and counsel focused on the coordination of resources related to the ongoing reorganization effort; (g) assist in the preparation of financial information for distribution to creditors and others, including cash flow projections and budgets, cash receipts and disbursement analysis, analysis of various asset and liability accounts, and analysis of proposed transactions for which court approval is sought; (h) attend meetings and assist in discussions with potential investors, banks, secured lenders, any official committee appointed in these chapter 11 cases, the U.S. trustee and other parties-in-interest; (i) analyze creditor claims by type, entity and individual claim, and develop databases to track those claims; (j) assist in the preparation of information and analysis necessary for the confirmation of a plan of reorganization; (k) assist in the evaluation and analysis of avoidance actions; and (l) provide expert witness testimony. A&M's hourly rates are: (a) Restructuring Advisory Services Managing Director $875 - $1,100 Director $675 - $850 Analyst/Associate $400 - $650 (b) Claims Management Services Managing Director $825 - $950 Director $650 - $800 Analyst/Consultant $400 - $600 The firm received a retainer in the amount of $300,000. Justin Schmaltz, managing director of A&M, disclosed in court filings that his firm is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. A&M can be reached through: Justin Schmaltz Alvarez & Marsal North America, LLC 540 West Madison Street, Suite 1800 Chicago, IL 60661 Tel: +1 312 288 4044 / +1 312 601 4220 Fax: +1 312 332 4599 Email: jschmaltz@alvarezandmarsal.com About Windstream Holdings Windstream Holdings, Inc. and its subsidiaries are providers of advanced network communications and technology solutions for businesses across the United States. They also offer broadband, entertainment and security solutions to consumers and small businesses primarily in rural areas in 18 states. Windstream Holding Inc. and its subsidiaries filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25, 2019. The Debtors had total assets of $13,126,435,000 and total debt of $11,199,070,000 as of Jan. 31, 2019. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as counsel; PJT Partners LP as financial advisor and investment banker; Alvarez & Marsal North America LLC as restructuring advisor; and Kurtzman Carson Consultants as notice and claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on March 12, 2019. The committee tapped Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP as its financial advisor, and Perella Weinberg Partners LP as investment banker. WINDSTREAM HOLDINGS: Taps KCC as Administrative Advisor ------------------------------------------------------- Windstream Holdings, Inc., received approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Kurtzman Carson Consultants LLC as its administrative advisor. The firm will provide bankruptcy administrative services to the company and its affiliates, which include the solicitation, balloting and tabulation of votes in connection with their Chapter 11 plan; the preparation of reports in support of the plan; and managing distributions pursuant to the plan. Evan Gershbein, senior vice president of Kurtzman, disclosed in court filings that the firm is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Evan Gershbein Kurtzman Carson Consultants LLC 2335 Alaska Avenue El Segundo, CA 90245 Tel: (310) 823-9000 About Windstream Holdings Windstream Holdings, Inc., and its subsidiaries are providers of advanced network communications and technology solutions for businesses across the United States. They also offer broadband, entertainment and security solutions to consumers and small businesses primarily in rural areas in 18 states. Windstream Holding Inc. and its subsidiaries filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25, 2019. The Debtors had total assets of $13,126,435,000 and total debt of $11,199,070,000 as of Jan. 31, 2019. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as counsel; PJT Partners LP as financial advisor and investment banker; Alvarez & Marsal North America LLC as restructuring advisor; and Kurtzman Carson Consultants as notice and claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on March 12, 2019. The committee tapped Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP as its financial advisor, and Perella Weinberg Partners LP as investment banker. WINDSTREAM HOLDINGS: Taps Kirkland & Ellis as Legal Counsel ----------------------------------------------------------- Windstream Holdings, Inc. received approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Kirkland & Ellis LLP and Kirkland & Ellis International LLP as its legal counsel. The firms will provide these services in the Chapter 11 cases of the company and its affiliates: (a) advise the Debtors of their powers and duties in the continued management and operation of their businesses and properties; (b) negotiate with representatives of creditors and other parties in interest; (c) take all necessary actions to protect and preserve the Debtors' estates, including prosecuting actions on the Debtors’ behalf and defending any action commenced against the Debtors; (d) represent the Debtors in connection with obtaining authority to continue using cash collateral and post-petition financing; (e) advise the Debtors in connection with any potential sale of assets; (f) advise the Debtors regarding tax matters; (g) take any necessary action to negotiate, prepare and obtain approval of a disclosure statement and confirmation of a bankruptcy plan; and (h) analyze leases, contracts and the validity of liens against the Debtors, and advise the Debtors on corporate and litigation matters. The firm's hourly rates are: Partners $1,025 – $1,795 Of Counsel $595 – $1,705 Associates $595 – $1,125 Paraprofessionals $235 – $460 The Debtors paid $4,000,000 to the firms, which constituted an "advance payment retainer" on Nov. 15, 2017. Subsequently, the Debtors paid the firms additional retainer totaling $15,974,146.75. Stephen Hessler, Esq., president of Stephen E. Hessler, P.C., a partner of Kirkland, disclosed in court filings that the firms are "disinterested" as defined in Section 101(14) of the Bankruptcy Code. In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, Mr. Hessler disclosed that the firms have not agreed to a variation of their standard billing arrangements for their employment with the Debtors, and that no Kirkland professional has varied his rate based on the geographic location of the Debtors' bankruptcy cases. The attorney also disclosed that the firms used these hourly rates for services provided to the Debtors from Feb. 25, 2018 to December 31, 2018: Partners $975 – $1,795 Of Counsel $575 – $1,795 Associates $575 – $1,065 Paraprofessionals $220 – $440 The Debtors have already approved the firms' budget and staffing plan for the period Feb. 25 to June 25, 2019, according to Mr. Hessler. Kirkland can be reached through: Stephen E. Hessler, P.C. Marc Kieselstein, P.C. Cristine Pirro Schwarzman, Esq. Kirkland & Ellis LLP Kirkland & Ellis International LLP 601 Lexington Avenue New York, New York 10022 Tel: (212) 446-4800 Fax: (212) 446-4900 Email: stephen.hessler@kirkland.com marc.kieselstein@kirkland.com cristine.pirro@kirkland.com - and - James H.M. Sprayregen, P.C. Ross M. Kwasteniet, P.C. Brad Weiland, Esq. John R. Luze, Esq. Kirkland & Ellis LLP Kirkland & Ellis International LLP 300 North LaSalle Street Chicago, Illinois 60654 Tel: (312) 862-2000 Fax: (312) 862-2200 Email: james.sprayregen@kirkland.com ross.kwasteniet@kirkland.com brad.weiland@kirkland.com john.luze@kirkland.com About Windstream Holdings Windstream Holdings, Inc. and its subsidiaries are providers of advanced network communications and technology solutions for businesses across the United States. They also offer broadband, entertainment and security solutions to consumers and small businesses primarily in rural areas in 18 states. Windstream Holding Inc. and its subsidiaries filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25, 2019. The Debtors had total assets of $13,126,435,000 and total debt of $11,199,070,000 as of Jan. 31, 2019. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as counsel; PJT Partners LP as financial advisor and investment banker; Alvarez & Marsal North America LLC as restructuring advisor; and Kurtzman Carson Consultants as notice and claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on March 12, 2019. The committee tapped Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP as its financial advisor, and Perella Weinberg Partners LP as investment banker. WINDSTREAM HOLDINGS: Taps PJT Partners as Investment Banker ----------------------------------------------------------- Windstream Holdings, Inc., received approval from the U.S. Bankruptcy Court for the Southern District of New York to hire PJT Partners LP as investment banker. The firm will provide these services to the company and its affiliates in connection with their Chapter 11 cases: (a) assisting in the evaluation of the Debtors' businesses and prospects; (b) assisting in the development of the Debtors' long-term business plan and related financial projections; (c) assisting in the development of financial data and presentations to the Debtors' board of directors, various creditors and other third parties; (d) analyzing the Debtors' financial liquidity and evaluate alternatives to improve such liquidity; (e) analyzing various restructuring scenarios and the potential impact of these scenarios on the recoveries of those stakeholders impacted by the restructuring; (f) providing strategic advice with regard to a potential restructuring or refinancing of the Debtors' obligations; (g) evaluating the Debtors' debt capacity and alternative capital structures; (h) participating in negotiations among the Debtors and their creditors, suppliers, lessors and other interested parties; (i) valuing securities offered by the Debtors in connection with a restructuring; (j) advising the Debtors and negotiating with lenders with respect to potential waivers or amendments of various credit facilities; (k) assisting in arranging financing for the Debtors; and (l) providing expert witness testimony. The Debtors will pay the firm a monthly advisory fee of $250,000. Fifty percent of all monthly fees paid in excess of $1.5 million will be credited against the restructuring fee. The Debtors will pay PJT a fee for any financing arranged by the firm, payable upon the closing of such capital raise. If access to the financing is limited by orders of the court, a proportionate fee will be payable with respect to each available commitment (irrespective of availability blocks, borrowing base, or other similar restrictions). The capital raising fee will be calculated as follows: (i) 0.5 percent of the total issuance size for senior debt (including, but not limited to, debtor-in-possession) financing; (ii) 1.5 percent of the total issuance size for junior debt financing; and (iii) 3 percent of the issuance amount for equity financing. Fifty percent of all capital raising fees paid to PJT will be credited against any restructuring fee. Meanwhile, the Debtors will pay PJT a restructuring fee equal to the sum of (i) 0.25 percent of the principal amount of funded debt outstanding for which the Debtors or its subsidiaries and affiliates are the primary obligor or guarantor as of the petition date; and (ii) 0.5 percent of the capitalized value of the annualized cost savings with respect to capital leases obligations restructured, including the master lease with Uniti Group Inc., to be calculated by dividing the reduction in the amount of lease payments for the first 365-day period following emergence from Chapter 11 by 10 percent. PJT is "disinterested" as defined in Section 101(14) of the Bankruptcy Code, according to court filings. The firm can be reached through: Nicholas Leone PJT Partners LP 280 Park Avenue New York, NY 10017 Phone: +1 212.364.7800 Email: info@pjtpartners.com About Windstream Holdings Windstream Holdings, Inc. and its subsidiaries are providers of advanced network communications and technology solutions for businesses across the United States. They also offer broadband, entertainment and security solutions to consumers and small businesses primarily in rural areas in 18 states. Windstream Holding Inc. and its subsidiaries filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25, 2019. The Debtors had total assets of $13,126,435,000 and total debt of $11,199,070,000 as of Jan. 31, 2019. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as counsel; PJT Partners LP as financial advisor and investment banker; Alvarez & Marsal North America LLC as restructuring advisor; and Kurtzman Carson Consultants as notice and claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on March 12, 2019. The committee tapped Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP as its financial advisor, and Perella Weinberg Partners LP as investment banker. WINDSTREAM HOLDINGS: Taps PricewaterhouseCoopers as Auditor ----------------------------------------------------------- Windstream Holdings, Inc., received approval from the U.S. Bankruptcy Court for the Southern District of New York to hire PricewaterhouseCoopers LLP. PwC will provide accounting and advisory consulting services, including an audit review, to the company and its affiliates. Specifically, the firm will: (a) audit the consolidated financial statements of the Debtors as of and for the year ending Dec. 31, 2019 and of the effectiveness of their internal control over financial reporting as of Dec. 31, 2019, and provide the Debtors with the audit report related to those financial statements; (b) perform reviews of the Debtors' unaudited quarterly financial information for each of the first three quarters in the year ending Dec. 31, 2019, before the Form 10-Q is filed; (c) communicate with the Debtors' audit committee and management about any matters that PwC believes may require material modifications to the financial information to make it conform with accounting principles generally accepted in the United States; (d) examine evidence supporting the amounts and disclosures in the financial statements, assess accounting principles used and significant estimates made by management, and evaluate the overall financial statement presentation; (e) discuss, review and test certain information related to the adoption of standards issued by the FASB: ASU No. 2016-02, Leases (Topic 842), which will be adopted by the Debtors as of Jan. 1, 2019; and (f) perform certain incremental audit and review procedures in connection with the Debtors' bankruptcy cases, including analyzing the Debtors' identification of pre-bankruptcy and post-petition liabilities, reviewing their consolidated financial statements and reorganization expenses, performing controls testing of new or modified controls established during the bankruptcy process, and providing general accounting advice regarding the adoption of debtor-in-possession accounting. The engagement agreement provides for an estimated fixed fee of $3.67 million, excluding out-of-pocket expenses, which will be billed in 10 monthly installments. Meanwhile, PwC will charge these hourly fees for the incremental services: Additional Bankruptcy-Related Services Rate (Core Assurance Professional Level & Tax Team) Rate (Specialists) ------------------ -------------- ------------------ National Office $995 $995 Partner $881 $949 Director $790 $865 Senior Manager $500 $769 Manager $415 $674 Senior Associate $309 $554 Experience Associate $215 $483 Associate $199 $218 Pre-Approved Audit-Related Services Rate (Core Assurance Professional Level & Tax Team) Rate (Specialists) ------------------ -------------- ------------------ National Office $971 - $995 $995 Partner $685 - $881 $995 Director $518 - $548 $775 Senior Manager $402 - $445 $700 Manager $309 - $342 $527 Senior Associate $223 - $255 $386 Experienced Associate $188 - $199 $270 Associate $168 - $179 $255 Rob Glasgow, a partner at PwC, disclosed in court filings that his firm is "disinterested" as defined in Section 101(14) of the Bankruptcy Code. PwC can be reached through: Rob Glasgow PricewaterhouseCoopers LLP 1075 Peachtree Street, Suite 2600 Atlanta, GA 30309 Telephone: [1] (678) 419 1000 Telecopier: [1] (678) 419 1239 About Windstream Holdings Windstream Holdings, Inc. and its subsidiaries are providers of advanced network communications and technology solutions for businesses across the United States. They also offer broadband, entertainment and security solutions to consumers and small businesses primarily in rural areas in 18 states. Windstream Holding Inc. and its subsidiaries filed for bankruptcy protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25, 2019. The Debtors had total assets of $13,126,435,000 and total debt of $11,199,070,000 as of Jan. 31, 2019. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as counsel; PJT Partners LP as financial advisor and investment banker; Alvarez & Marsal North America LLC as restructuring advisor; and Kurtzman Carson Consultants as notice and claims agent. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on March 12, 2019. The committee tapped Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP as its financial advisor, and Perella Weinberg Partners LP as investment banker. ZACKY & SONS: Sets Bidding Procedures for 15 Real Properties ------------------------------------------------------------ Zacky & Sons Poultry, LLC, asks the U.S. Bankruptcy Court for the Central District of California to authorize the sale of substantially all real estate related assets identified in Exhibit 2, comprised of a total of 15 real properties, including an office building, three processing/cook plant facilities, a warehouse facility, a hatchery, seven ranches, a maintenance yard, and a litter yard, at auction. As a result of operating losses and a lack of liquidity and being in default of its secured loan obligations to its primary non-insider secured lenders, GemCap Lending I, LLC and Great Rock Capital Partners Management, LLC, the Debtor is in the process of winding down a business that has been a household name in the poultry food market for more than 60 years. The current substantial secured debt owing to GemCap and Great Rock was obtained in late 2017 or early 2018. At the time of the Debtor’s bankruptcy filing, GemCap held a first priority lien against the Debtor’s personal property, including machinery and equipment, inventory, livestock, accounts receivable, and intellectual property. The Debtor understands that, as of the Petition Date, GemCap was owed approximately $15.9 million comprised of approximately $9.5 million on its revolver loan, approximately $2.5 million on its term loan, and approximately $3.9 million on its overadvance loan. The Debtor understands that, as of Jan. 18, 2019, the outstanding loan balance due to Great Rock was approximately $30,683,586 (excluding interest, fees, advances and other amounts payable under the loan), secured by a first priority lien against the real estate related assets owned by the Debtor and its affiliates. In addition to the Debtor's substantial secured debt owing to GemCap, Great Rock and Lillian Zacky, the Debtor also has unsecured debt in the estimated total amount of approximately $18.2 million. Based on preliminary title reports obtained for the Assets, the Assets appear to be subject to these liens: a. 2020 S. East Avenue, Fresno, CA (AIN 468-040-07S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) b. 2222 & 2240 S. East Avenue, Fresno, CA (AIN 480-040-06S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) c. 2950 E. California Avenue Fresno, CA (AIN 480-040-11, 468-040-07S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) d. 2272 S. East Avenue, Fresno, CA (AIN 480-040-07S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) e. 1111 Navy Drive, Stockton, CA (AIN 163-260-07): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) f. 43501 & 43473 6th Avenue, Corcoran, CA (AIN 046-270-004 & 035): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) g. 19010 & 19012 S. Brawley, Fresno, CA (AIN 053-090-37S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) h. 590 W. Kamm Avenue, Caruthers, CA (AIN 043-050-15S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) i. 16395 & 16485 19th Avenue, Lemoore, CA (AIN 024-170-020): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) j. 17432 & 17388 18th Avenue, Lemoore, CA (AIN 026-060-007): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) k. 19744 Kent Avenue, Lemoore, CA (AIN 024-170-073): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) l. 8351 McMullin Grade, Fresno, CA (AIN 035-061-08S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) m. 1486 S. Industrial Way, Kerman, CA (AIN 023-060-44S): (i) Great Rock ($25 million) and (ii) GemCap ($16,110,430) n. 190 N. Thorne, Fresno, CA (AIN 458-250-02): Fresno County Tax Collector ($1,954) o. 18804 & 18940 S. Camden Ave., Laton, CA (AIN 055-310-29): Fresno County Tax Collector ($1,523) Pending the consummation of the Debtor's sale of the Assets, Great Rock agreed to fund certain costs which are required to be paid to maintain, secure, clean up, manage and sell the Assets, through protective advances in accordance with an agreed upon budget, in order to facilitate the Debtor's free and clear and expeditious sale of the Asset. In the event that an expeditious sale(s) of the Assets cannot be consummated, Great Rock has indicated that it will proceed to foreclose on the Assets. Since the Debtor is no longer the owner of its former furniture, machinery and equipment, any buyer who is interested in purchasing any of those assets should deal directly with Great Rock. On Feb. 5, 2019, the Debtor filed an application asking to employ Kennedy Wilson Properties, Ltd. ("KW") as the Debtor's exclusive real estate broker to assist the Debtor in the sale process for certain of the Assets, specifically the five industrial properties generally referred to as the Stockton facility, the Empire facility, the East Plant facility, the Main Office and East Plant parking lot, and the Florence warehouse. The Court entered an order approving the Debtor's application to employ KW as its real estate broker related to the foregoing five industrial properties on March 12, 2019. In addition to KW, the Debtor has been assisted in its sale efforts by Stapleton Group, who was retained by Great Rock as its real estate consultant in connection with the marketing and sale of the Assets. On March 5, 2019, the Court entered an order granting the Debtor's motion asking approval of the bidding and sale auction procedures proposed by the Debtor, subject to certain modifications approved by the Court. The Debtor was authorized (but not required) to select, subject to the consent of Great Rock, one or more stalking horse bidders by no later than April 9, 2019. Stalking horse bidders selected by the Debtor are entitled to the payment of a breakup fee and/or reimbursement of reasonable and documented out-of-pocket expenses, from the proceeds received upon the consummation of an alternative transaction, up to an aggregate of 3% of the purchase price for the applicable Sale in connection with any stalking horse agreement with a Stalking Horse Bidder. The salient terms of the Bidding Procedures are: a. Bid Deadline: 5:00 p.m. (PT) on April 19, 2019 b. Initial Bid: TBD. Each Bid must clearly set forth the Qualified Bidder's proposed purchase price in U.S. Dollars. c. Deposit: 10% of the aggregate cash and non-cash Purchase Price of the Bid d. Auction: The Auction will take place at 10:00 a.m. (PT) on April 23, 2019 at the offices of Levene, Neale, Bender, Yoo & Brill L.L.P., 10250 Constellation Boulevard, Suite 1700, Los Angeles, California 90067. e. Bid Increments: TBD f. Each Bid must clearly state which Assets the Qualified Bidder is agreeing to purchase and, to the extent applicable, which of the Debtor's liabilities the Qualified Bidder is agreeing to assume. g. Great Rock has the right to submit a credit bid up to the amount of Great Rock’s total secured claim, for all or any portion of the Assets at any time prior to the end of the Auction, upon such terms and conditions as it may deem acceptable in its sole discretion, and which Credit Bid will not be subject to the Bidding Procedures set forth. Pursuant to the Motion, the Debtor asks authority to enter into one or more asset purchase agreements, with the successful bidders for one or more of the Assets, free and clear of all liens, claims, encumbrances and other interests, and under the terms and conditions set forth in the APAs. The Debtor has selected Charlies Enterprises, Inc, doing business as OK produce, to be the Stalking Horse Bidder for the real property located at 2020 S. East Avenue Fresno, California (Office Headquarters), APN 468-040-07S, for the purchase price of $1.9 million, subject to overbid, with $25,000 as break-up fee. With respect to the remaining 14 Assets which are not the subject of the bid from the Stalking Horse Bidder, the Debtor asks authority to sell such Assets to the successful Qualified Bidder(s) as determined at the Auction, free and clear of all liens, claims, encumbrances and other interests. Finally, the Debtor respectfully asks that the Court waives the 14-day stay period set forth in Bankruptcy Rule 6004(h) to permit the Debtor to proceed immediately to close the Sales of the Assets following the entry of the Sale Order. A hearing on the Motion is set for April 30, 2019 at 2:30 p.m. About Zacky and Sons Poultry Zacky & Sons Poultry, LLC -- http://zackyfarms.com-- is a grower, processor, distributor, and wholesaler of poultry products. It offers turkey and chicken products such as sausages, franks, and sliced meat. Zacky & Sons Poultry, LLC, based in City of Industry, CA, filed a Chapter 11 petition (Bankr. C.D. Cal. Case No. 18-23361) on Nov. 13, 2018. In the petition signed by Lillian Zacky, managing member, the Debtor estimated $50 million to $100 million in assets and liabilities. The Hon. Robert N. Kwan oversees the case. Ron Bender, Esq., at Levene Neale Bender Yoo & Brill L.L.P., serves as bankruptcy counsel; GlassRatner Advisory & Capital Group, LLC as financial advisor; and LKP Global Law, LLP as special employment and labor counsel. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Washington, D.C., USA. Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Valerie Udtuhan, Howard C. Tolentino, Carmel Paderog, Meriam Fernandez, Joel Anthony G. Lopez, Cecil R. Villacampa, Sheryl Joy P. Olano, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2019. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***