/raid1/www/Hosts/bankrupt/TCR_Public/190516.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Thursday, May 16, 2019, Vol. 23, No. 135
Headlines
2500 WEST LOOP: Hires KenWood & Associates as Accountant
4J CUSTOM DESIGN: June 26 Plan Confirmation Hearing
73 EMPIRE DEVELOPMENT: Interest Holders to Fund $2.9MM to Plan
A V CAR & HOME: June 18 Plan Confirmation Hearing
AAC HOLDINGS: Files Form 10-Q for Quarter Ended March 31
AERKOMM INC: Incurs $2.38 Million Net Loss in First Quarter
ALCOR ENERGY: Court Confirms Proposed 1st Amended Plan
AMANECER PRIMARY: Hires Santiago Gonzalez as Accountant
AMERICA-CV STATION: Case Summary & 20 Largest Unsecured Creditors
ARCIMOTO INC: Incurs $3.06 Million Net Loss in First Quarter
ARIZONA SOUTHWEST: Plan Outline OK'd; Plan Hearing Set for June 13
AUTOCANADA INC: S&P Cuts Issuer Credit Rating to 'B'; Outlook Neg.
AYTU BIOSCIENCE: Incurs $4.5 Million Net Loss in Third Quarter
BIOSTAGE INC: Incurs $1.92 Million Net Loss in First Quarter
BUCKEYE PARTNERS: Moody's Reviews Ba1 Jr. Sub. Notes for Downgrade
CACTUS CIRCLE: Unsecureds to Get 100% Over 36 Months at 12%
CADIZ INC: Incurs $7.26 Million Net Loss in First Quarter
CAMBER ENERGY: Completes Due Diligence on Planned Acquisition
CAREVIEW COMMUNICATIONS: Incurs $3.1-Mil. Net Loss in 1st Quarter
CAROLINA HOME: June 12 Plan Confirmation Hearing
CHURNEY'S REAL ESTATE: Court Denies Approval of Plan Disclosures
COMMSCOPE HOLDING: S&P Places 'BB-' ICR on CreditWatch Negative
COOPER-STANDARD HOLDINGS: S&P Cuts ICR to 'BB-'; Outlook Stable
CORE & MAIN: Moody's Affirms B2 CFR on Long Island Acquisition
CORE & MAIN: S&P Affirms 'B+' Issuer Credit Rating; Outlook Stable
CORNERSTAR WINE: U.S. Trustee Unable to Appoint Committee
COX LAND & TIMBER: Selling Equipment & Personal Property
CREDIT MANAGEMENT: Unsecured Creditors Estimated to Recoup 17%
CYTORI THERAPEUTICS: Posts $3.15 Million Net Loss in First Quarter
EASTERN ILLINOIS UNIVERSITY: Moody's Raises $78MM COPs to B3
EDGEWELL PERSONAL: S&P Places 'BB' ICR on CreditWatch Negative
ELDORADO GOLD: Moody's Rates 2nd Lien Notes Due 2024 'Caa1'
ELDORADO GOLD: S&P Affirms B Issuer Credit Rating; Outlook Stable
EXCO RESOURCES: Chapter 11 Plan Confirmation Set for June 10
FALCON HOLDINGS: Voluntary Chapter 11 Case Summary
FERMARALIZ CORP: Unsecureds to Get 2% in 60 Months Under Plan
FREEDOM FOODS: U.S. Trustee Unable to Appoint Committee
GARLAND BARBECUE: June 11 Plan Confirmation Hearing
GLOBAL ENERGY: Case Summary & 20 Largest Unsecured Creditors
GOLDEN STATE: Unsecureds to be Paid $30K Under Latest Plan
GOVERNORS STATE: Moody's Alters Outlook on Ba3 Rating to Stable
GREATER APOSTOLIC: Case Summary & 7 Unsecured Creditors
GREENPARTS INTERNATIONAL: U.S. Trustee Unable to Appoint Committee
GUIDED SYSTEMS: Income Stream to Fund Proposed Plan
HEARTLAND DENTAL: S&P Alters Outlook to Negative, Affirms 'B-' ICR
IAA SPINCO: Fitch Assigns First-Time 'BB-' LT IDR, Outlook Stable
IAA SPINCO: S&P Assigns 'BB-' Issuer Credit Rating; Outlook Stable
INOVALON HOLDINGS: S&P Upgrades ICR to 'B+'; Outlook Stable
INPIXON: Incurs $5.15 Million Net Loss in First Quarter
INT'L MANUFACTURING: Court Dismisses Trustee Complaint vs WII
JCV TRUCKING: Unsecureds to Get $1,000 Monthly Over 60 Months
JLM ENERGY: Unsecured Creditors to Get 0% Under Chapter 11 Plan
JOHN B. COX: Proposes Private Sale of Personal Property
JONES ENERGY: Court Approves Disclosures, Confirms Ch. 11 Plan
JUST ONE MORE: U.S. Trustee Unable to Appoint Committee
LANDS' END: S&P Raises ICR to B on Debt Prepayment; Outlook Stable
LC STAHL: Wants Court to Approve Proposed Plan Outline
LINEAGE LOGISTICS: Moody's Hikes CFR to B2, Outlook Stable
LNB-015-13 LLC: June 20 Approval Hearing on Disclosure Statement
LUXURY LIMOUSINE: Philadelphia Objects to Disclosure Statement
MACQ–TENNESSEE I: S&P Rates 2019 Student Housing Bonds 'BB+'
MAJOR EVENTS: Latest Plan Amends Treatment of IRS Claim
MIDWEST-ST. LOUIS: U.S. Trustee Unable to Appoint Committee
MONTEREY RESOURCES: Case Summary & 44 Largest Unsecured Creditors
MONTGOMERY SERVICES: Lender Objects to Disclosure Statement
N & B MANAGEMENT: Unsecureds to be Paid in Full with No Interest
NATIVE SON: Court Confirms Chapter 11 Plan
NCW PROPERTIES: Unsecured Creditors to Get 3% to 6% Under Plan
NORTHEASTERN ILLINOIS UNIVERSITY: Moody's Affirms B3 on $31MM COPs
NORTHERN ILLINOIS UNIVERSITY: Moody's Affirms Ba3 on $9MM COPs
NS FITNESS: U.S. Trustee Unable to Appoint Committee
OHCP NORTHEASTERN: S&P Affirms 'B-' Rating on First-Lien Term Loan
OWENS & MINOR: Fitch Cuts LT IDR to CCC+ & Sec. Debt Rating to B-
PARQ HOLDINGS: Moody's Withdraws Caa1 CFR on Debt Repayment
PIONEER AIRCRAFT: Fitch to Rate $26MM Series C Notes 'BB(EXP)sf'
PREFERRED PROPPANTS: Moody's Lowers CFR to 'C', Outlook Stable
PRINCETON AVENUE GROUP: Case Summary & 7 Unsecured Creditors
PUMAS CAB: Plan Increases Distribution to New York DOTF to 28.7%
QUARRY SERVICES: Taps Mark Bryant CPA as Accountant
QUARRY SERVICES: To Pay Unsecureds $300K in Quarterly Installments
RIOT BLOCKCHAIN: Incurs $13.75 Million Net Loss in First Quarter
ROCK CREEK BAPTIST: Case Summary & 13 Unsecured Creditors
SANCHEZ ENERGY: Signs Services Agreements with Top Executives
SIRIUS COMPUTER: Moody's Gives B2 CFR Amid Buyout, Outlook Stable
SOUTHERN ILLINOIS UNIVERSITY: Moody's Hikes $24MM COPs to Ba3
SPECIALTY RETAIL: $2.2-Mil. Sale of Visa/MasterCard Claim Approved
SPECIALTY RETAIL: Delaware Trust Objects to Plan Confirmation
SUNEDISON INC: Shareholders to Proceed With Class Action
SWIFT STAFFING: July 23 Evidentiary Hearing on Plan Confirmation
TECHNICAL COMMUNICATIONS: Delays Q2 Quarterly Report for Review
TERRAVISTA PARTNERS: Unsecureds to be Paid from 2020 to 2025
TESLA INC: S&P Affirms 'B-' ICR After Capital Raise; Outlook Neg.
THAI LEMAR: Unsecured Creditors to Get 15% Under Plan
TPE INDUSTRIES: Plan Confirmation Hearing Set for June 4
U & J CAFE: Selling 1981 Chevrolet P30 Step Van for $25K
VBAR 3 LLC: Seeks to Hire Tarter Krinsky as Counsel
VERDESIAN LIFE: S&P Cuts ICR to CCC- on Increased Refinancing Risk
VESTA ENERGY: S&P Lowers Senior Unsecured Debt Rating to 'B-'
VORAS ENTERPRISE: Court Approves Disclosures, Confirms Ch. 11 Plan
WEINSTEIN COMPANY: Hires Bernstein Litowitz as Special Counsel
WILSON LAND: Jacob Poyar Buying Painesville Property for $260K
WINDSTREAM HOLDINGS: Committee Taps Alix as Financial Advisor
WINDSTREAM HOLDINGS: Taps Katten Muchin as Conflicts Counsel
WMC MORTGAGE: Seek to Hire Alvarez & Marsal as Financial Advisor
WMC MORTGAGE: Seek to Hire Epiq as Administrative Advisor
WMC MORTGAGE: Seek to Hire Jenner & Block as Co-Counsel
WMC MORTGAGE: Seek to Hire Richards Layton as Counsel
[^] Recent Small-Dollar & Individual Chapter 11 Filings
*********
2500 WEST LOOP: Hires KenWood & Associates as Accountant
--------------------------------------------------------
Allison D. Byman, the Chapter 11 Trustee of 2500 West Loop, Inc.,
seeks authority from the U.S. Bankruptcy Court for the Southern
District of Texas to employ KenWood & Associates, PC, as accountant
to the Trustee.
The Trustee requires KenWood & Associates to:
a) prepare any necessary federal and state income, payroll,
sales, franchise and excise tax returns and reports of the
bankruptcy estate;
b) provide evaluations and advice to Trustee on tax matters
which may arise, including the determination of the tax
basis of estate assets and the evaluation of the tax
effects of the sale of assets of the estate;
c) locate, obtain, inventory and preserve the accounting,
business and computer records of the Debtor for use in
performing the tasks assigned to Applicant and in Trustee's
administration of the estate;
d) analyze the Debtor's books and records and financial
transactions regarding possible fraudulent, post-petition
and preferential transfers to which the estate may be
entitled to a recovery;
e) analyze the books and records and financial transactions of
entities and individuals to which the Debtor is related,
may be related or may have been related at some prior date
to determine the value of any assets and existence of
possible fraudulent transfers to which the estate may be
entitles to a recovery; and
f) assist the Trustee as an accountant and expert witness in
litigation of the estate, assist in examinations and
discovery under Federal Rule of Bankruptcy Procedure 2004
and the Federal Rules of Civil Procedures and to prepare
any required expert reports related to litigation matters.
KenWood & Associates will be paid at these hourly rates:
Partners $140 to $275
Associates $70 to $275
KenWood & Associates will also be reimbursed for reasonable
out-of-pocket expenses incurred.
David E. Bott, a partner at KenWood & Associates, 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 Debtors and their/its estates.
KenWood & Associates can be reached at:
David E. Bott
KENWOOD & ASSOCIATES, P
One Sugar Creek Center Blvd., Suite 300
Sugar Land, TX 77478
Tel: (281) 243-2300
Fax: (281) 243-2326
E-mail: debott@kenwoodpc.com
About 2500 West Loop
2500 West Loop, Inc., is a privately-held company whose principal
assets are located at Suite 422, 2429 Bissonnet St., Houston
Texas.
2500 West Loop sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D. Texas Case No. 18-20459) on Oct. 12, 2018. At
the time of the filing, the Debtor estimated assets of $10 million
to $50 million and liabilities of less than $500,000. The case is
assigned to Judge David R. Jones. The Debtor tapped Johnie J.
Patterson, Esq., at Walker & Patterson, P.C., as its legal counsel.
4J CUSTOM DESIGN: June 26 Plan Confirmation Hearing
---------------------------------------------------
The Bankruptcy Court conditionally approved the Amended Disclosure
Statement explaining the Amended Chapter 11 Plan of 4J Custom
Design Inc.
A hearing for the consideration of the final approval of the
Amended Disclosure Statement and the confirmation of the Amended
Plan and of such objections as may be made to either will be held,
for cause, on June 26, 2019, at 9:00 AM, at the U.S. Bankruptcy
Court, José V. Toledo U.S. Post Office and Courthouse Building,
300 Recinto Sur Street, Courtroom 3, Third Floor, San Juan, Puerto
Rico.
Acceptances or rejections of the Amended Plan may be filed in
writing by the holders of all claims on/or before fourteen (14)
days prior to the date of the hearing on confirmation of the Plan.
Any objection to the final approval of the Amended Disclosure
Statement and/or the confirmation of the Amended Plan shall be
filed on/or before fourteen (14) days prior to the date of the
hearing on confirmation of the Amended Plan.
About 4J Custom Design Inc.
4J Custom Design Inc., filed a Chapter 11 bankruptcy petition
(Bankr. D.P.R. Case No. 18-05704) on Sept. 28, 2018, estimating
under $1 million in assets and liabilities. Jaime Rodriguez Perez,
Esq., at Hatillo Law Office, PSC, is the Debtor's counsel.
73 EMPIRE DEVELOPMENT: Interest Holders to Fund $2.9MM to Plan
--------------------------------------------------------------
73 Empire Development LLC files a Chapter 11 Plan and accompanying
Disclosure Statement.
Class 4 - General Unsecured Claims are unimpaired. Claims total
approximately $2,741,619 held by Chaskeil Strulovithch and Irving
Starr LLC. Payment in Cash on the Effective Date, of Allowed
Amount of each such Claim plus interest at the Legal Rate as it
accrues from the Petition Date through the date of payment. Mr.
Strulovitch is a principal of the Debtor's 80% member. He and
Irving Starr LLC have agreed to defer payment until construction is
complete and payment can be made from net operating income.
Class 5 - Interests Holders are impaired. Entitled to ownership of
new Interests on account of payment of $2,965,000 to fund the Plan.
Effective Date payments under the Plan will be paid from capital to
be contributed by the Interest Holders.
A full-text copy of the Disclosure Statement dated May 2, 2019, is
available at https://tinyurl.com/y4yan6wt from PacerMonitor.com at
no charge.
About 73 Empire Development
73 Empire Development is a privately held company in Brooklyn, New
York that is engaged in activities related to real estate. It has
executed a ground lease on 73 Empire Blvd, Brooklyn, New York. The
current value of the Debtor's interest in the Property is $6
million based on informal market valuation.
73 Empire Development filed a voluntary petition under Chapter 11
of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 19-22285) on
February 20, 2019. In the petition signed by David Goldwasser,
authorized signatory of GC Realty Advisors, managing member, the
Debtor estimated $6,100,000 in assets and $2,808,285 in
liabilities. Mark A. Frankel, Esq. at Backenroth Frankel & Krinsky,
LLP, represents the Debtor as counsel.
The case has been assigned to Judge Robert D. Drain.
A V CAR & HOME: June 18 Plan Confirmation Hearing
-------------------------------------------------
The Bankruptcy Court issued an order setting the deadline to object
to final approval of the disclosure statement explaining A V Car &
Home LLC's Chapter 11 Plan. Any objections to approval of the
Disclosure Statement must be filed and served by May 23, 2019. If
no timely objection is filed, the court will approve the Disclosure
Statement and authorize the Disclosure Statement and the Joint Plan
to be disseminated to creditors by May 24, 2019, with June 12,
2019, being the deadline for objecting to confirmation and for
receipt of ballots, and June 14, 2019, being the deadline for a
tally of ballots, with a confirmation hearing to be held on June
18, 2019, at 10:30 a.m.
If a timely objection to approval of the Disclosure Statement is
filed, a hearing on approval of the Disclosure Statement will be
held on May 24, 2019, at 2:00 p.m. in Courtroom 1, U.S. Courthouse,
333 Constitution Avenue, N.W., Washington, D.C. 20001.
On September 8, 2016, Mr. Brown filed a pro se voluntary Petition
under Chapter 11 of the BankruptcyCode. On January 11, 2017, the
Court entered an Order converting Mr. Brown's case to a proceeding
under Chapter 7 of the Bankruptcy Code. Bryan Ross was appointed as
the Chapter 7 trustee for Mr. Brown's bankruptcy estate. The
Trustee previously attempted to remove the adverse possession case
in Mr. Brown's bankruptcy within thirty days of being served with
the complaint, but the case was remanded as untimely removed, based
on the length of time Mr. Brown spent in Chapter 11 before
converting to Chapter 7.
Class 4 consists of holders of General Unsecured Claims. Each
holder of an Allowed Class 4 Claim shall receive from the Debtor,
in full and complete settlement, satisfaction and discharge of its
Allowed Class Claim, on the Effective Date, 75% of the amount of
their claims. Upon the conclusion of all appeals in this Bankruptcy
Case, any related adversary proceeding, and the Adverse Possession
Case, holders of Allowed General Unsecured Claims will be paid the
remaining 25% of their claims, without interest. Holders of Class
4 Claims are impaired .
The sources of all Distributions and payments under this Plan are
the sale of the Property.
A full-text copy of the Disclosure Statement dated May 6, 2019, is
available at https://tinyurl.com/y33ungo6 from PacerMonitor.com at
no charge.
Attorneys for Bryan S. Ross, Chapter 7 Trustee:
Patrick J. Kearney, Esq.
Selzer Gurvitch Rabin Wertheimer & Polott, PC
4416 East West Highway, Suite 400
Bethesda, MD 20814-4568
Tel: (301) 986-9600
Email: pkearney@sgrwlaw.com
About A V Car & Home
A V Car & Home LLC, a company based in Washington, DC, is engaged
in activities related to real estate. A V Car & Home sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. D.D.C.
Case No. 18-00434) on June 20, 2018. In the petition signed by
Shawntell Parker, authorized representative, the Debtor estimated
assets of $1 million to $10 million and liabilities of $1 million
to $10 million. Judge Martin S. Teel, Jr., presides over the
case.
The Debtor is represented by Janet M. Nesse, Esq., and Justin P.
Fasano, Esq., at McNamee, Hosea, Jernigan, Kim, Greenan & Lynch,
P.A., in Greenbelt, Maryland.
AAC HOLDINGS: Files Form 10-Q for Quarter Ended March 31
--------------------------------------------------------
AAC Holdings, Inc., filed with the U.S. Securities and Exchange
Commission on May 13, 2019, its quarterly report on Form 10-Q
reporting a net loss attributable to the Company's common
stockholders of $22.01 million on $55.37 million of total revenues
for the three months ended March 31, 2019, compared to net income
attributable to the Company's common stockholders of $1.05 million
on $81.18 million of total revenues for the three months ended
March 31, 2018.
As of March 31, 2019, AAC Holdings had $480.22 million in total
assets, $461.56 million in total liabilities, and $18.65 million in
total stockholders' equity including non-controlling interest.
Cash used in operating activities was $9.6 million for the three
months ended March 31, 2019, compared to cash used in operating
activities of $19.0 million for the three months ended March 31,
2018. Included in the cash used in operating activities for the
three months ended March 31, 2018 was $25.0 million paid related to
the Tennessee claim.
Cash used in investing activities was $26,000 for the three months
ended March 31, 2019, compared to $72.5 million for the three
months ended March 31, 2018. Cash used in investing activities for
the three months ended March 31, 2018, was primarily related to the
AdCare Acquisition.
Cash provided by financing activities was $22.1 million for the
three months ended March 31, 2019, compared to $92.0 million for
the three months ended March 31, 2018. Cash provided by financing
activities for the three months ended March 31, 2019, was primarily
related to the net proceeds from the 2019 Senior Credit Facility.
The Company incurred a loss from operations and had negative cash
flows from operations for the year ended Dec. 31, 2018 and the
first quarter of 2019, which has contributed to limited liquidity.
This resulted primarily from declines in patient census during the
second half of 2018 and into the first quarter of 2019. The
Company's revenue is directly impacted by its ability to maintain
census, which is dependent on a variety of factors, many of which
are outside of the Company's control, including its referral
relationships, average length of stay of its clients, the extent to
which third-party payors require preadmission authorization or
utilization review controls, competition in the industry, the
effectiveness of the Company's multi-faceted sales and marketing
strategy and the individual decisions of the Company's clients to
seek and commit to treatment. On March 8, 2019 the Company entered
into an incremental senior credit facility for a principal loan of
$30 million which originally matured on March 31, 2020 and was
subsequently amended to mature on April 15, 2020.
AAC Holdings said, "The uncertainties associated with the factors
described above raise substantial doubt about the Company's ability
to continue as a going concern. In order for the Company to
continue operations beyond the next twelve months and to be able to
discharge its liabilities and commitments in the normal course of
business, the Company must do some or all of the following: (i)
improve operating results by increasing census while maintaining
efficiency regarding operating expenses through the cost savings
initiatives implemented in late 2018 and early 2019; (ii) execute
strategic alternatives related to the Company's real-estate
portfolio which could include further sale leasebacks of individual
facilities or larger portions of the company's real estate
portfolio (iii) sell additional non-core or non-essential assets;
and/or (iv) obtain additional financing. There can be no assurance
that the Company will be able to achieve any or all of the
foregoing."
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/xWu1kE
About AAC Holdings
Headquartered in Brentwood, Tennessee, AAC Holdings, Inc. --
http://www.americanaddictioncenters.com/-- is a provider of
inpatient and outpatient substance use treatment services for
individuals with drug addiction, alcohol addiction and co-occurring
mental/behavioral health issues. In connection with its treatment
services, the Company performs clinical diagnostic laboratory
services and provide physician services to its clients. As of Dec.
31, 2018, the Company operated 11 inpatient substance abuse
treatment facilities located throughout the United States, focused
on delivering effective clinical care and treatment solutions
across 1,080 inpatient beds, including 700 licensed detoxification
beds, 24 standalone outpatient centers and 4 sober living
facilities across 471 beds for a total of 1,551 combined inpatient
and sober living beds.
AAC Holdings reported a net loss of $66.71 million for the year
ended Dec. 31, 2018, compared to a net loss of $17.38 million for
the year ended Dec. 31, 2017. As of Dec. 31, 2018, AAC Holdings
had $452.27 million in total assets, $410 million in total
liabilities, and total stockholders' equity including
non-controlling interest of $42.27 million.
BDO USA, LLP, in Nashville, Tennessee, the Company's auditor since
2011, issued a "going concern" qualification in its report dated
April 12, 2019, on the Company's consolidated financial statements
for the year ended Dec. 31, 2018, citing that the Company has
incurred a loss from operations and negative cash flows from
operations that raise substantial doubt about its ability to
continue as a going concern.
* * *
As reported by the TCR on March 19, 2019, S&P Global Ratings on
lowered the issuer credit rating on AAC Holdings Inc. to 'CCC' from
'B-' and said the outlook is negative. According to S&P, the
downgrade reflects escalated risk of a default and risk that AAC's
liquidity will not be sufficient over the next 12 months, primarily
due to the $30 million term loan maturing in about one year.
Moody's Investors Service downgraded the corporate family rating
rating of AAC Holdings, parent company of American Addiction
Centers, Inc., to 'Caa2' from 'B3'. The downgrade to 'Caa2'
reflects AAC's very weak third quarter results and lower guidance
for the rest of 2018.
AERKOMM INC: Incurs $2.38 Million Net Loss in First Quarter
-----------------------------------------------------------
Aerkomm Inc. filed with the U.S. Securities and Exchange Commission
on May 14, 2019, its quarterly report on Form 10-Q reporting a net
loss of $2.38 million on $0 of net sales for the three months ended
March 31, 2019, compared to a net loss of $1.45 million on $0 of
net sales for the three months ended March 31, 2018.
As of March 31, 2019, the Company had $47.18 million in total
assets, $7.55 million in total liabilities, and $39.62 million in
total stockholders' equity.
As of March 31, 2019, the Company had cash and cash equivalents of
$78,248. To date, the Company has financed its operations
primarily through cash proceeds from financing activities,
including through its ongoing public offering, short-term
borrowings and equity contributions by its stockholders.
Net cash used for operating activities was $534,882 for the three
months ended March 31, 2019, as compared to $367,556 for the three
months ended March 31, 2018.
Net cash used for investing activities for the three months ended
March 31, 2019 was $1,275 as compared to $6,352 for the three
months ended March 31, 2018. The net cash used for investing
activities for the three months ended March 31, 2019 and 2018 was
mainly for the purchase of property and equipment.
Net cash provided by financing activities for the three months
ended March 31, 2019 and 2018 was $182,500 and $407,707,
respectively. Net cash provided by financing activities for the
three months ended March 31, 2019 were mainly attributable to net
proceeds from the borrowing of short-term loans from affiliates in
the amount of $182,500.
The Company has not generated significant revenues, excluding
non-recurring revenues from affiliates in the second quarter of
fiscal 2018, and expects to incur additional expenses as a result
of being a public reporting company. Currently, the Company has
taken measures that management believes will improve its financial
position by financing activities, including through its ongoing
public offering, short-term borrowings and equity contributions.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/gVSFbW
About Aerkomm
Aerkomm Inc. -- http://www.aerkomm.com/-- is a full-service
development stage provider of In-flight Entertainment &
Connectivity (IFEC) solutions, intended to provide airline
passengers with a broadband in-flight experience that encompasses a
wide range of service options. Those options include Wi-Fi,
cellular, movies, gaming, live TV, and music. The Company plans to
offer these core services, which it is currently still developing,
through both built-in in-flight entertainment systems, such as a
seat-back display, as well as on passengers' own personal devices.
Chen & Fan Accountancy Corporation, in San Jose, California, the
Company's auditor since 2017, issued a "going concern"
qualification in its report dated March 22, 2019, on the Company's
consolidated financial statements for the year ended Dec. 31, 2018,
citing that the Company has suffered recurring loss from operations
that raises substantial doubt about its ability to continue as a
going concern.
ALCOR ENERGY: Court Confirms Proposed 1st Amended Plan
------------------------------------------------------
Bankruptcy Judge Christopher S. Sontchi issued an order confirming
Alcor Energy, LLC's first amended small business plan of
reorganization.
The Court finds that the Plan has been proposed in good faith and
not by any means forbidden by law. In so finding, this Court has
considered the totality of the circumstances of the Chapter 11
Case, and found that all constituencies acted in good faith. The
Plan is the result of extensive, good faith, arm's length
negotiations among the Debtor and its principal constituencies.
The Plan does not "discriminate unfairly" and is "fair and
equitable" with respect to the Classes that are impaired and are
deemed to reject the Plan, because no Class senior to any rejecting
Class is being paid more than in full and the Plan does not provide
a recovery on account of any Claim or Interest that is junior to
such rejecting Classes.
The releases contained in Article XI of the Plan are an essential
component of the Plan. Accordingly, the releases contained in
Article XI of the Plan are: (a) in exchange for the good and
valuable consideration provided by the Protected Parties; (b) a
good faith settlement and compromise of the Claims released by
Article XI of the Plan; (c) in the best interests of the Debtor and
all holders of Claims and Interests; (d) fair, equitable, and
reasonable; and (e) given and made after due notice and opportunity
for hearing.
The exculpation provided by Article XI of the Plan for the benefit
of the Exculpated Parties is appropriately tailored to the
circumstances of the Chapter 11 Case.
As previously reported by the Troubled Company Reporter, through
the Plan, the Debtor proposes to pay its creditors from cash flow
from operations and future income plus an infusion of capital from
its pre-petition and post-petition lender, Ocho Ventura, LLC.
A full-text copy of the First Amended Disclosure Statement March 4,
2019, is available at https://tinyurl.com/y455mcgh from
PacerMonitor.com at no charge.
About Alcor Energy LLC
Alcor Energy, LLC -- https://www.alcor.energy -- is in the turbines
and turbine generator business. Its turbines use 100% natural gas,
which is the cleanest possible fossil fuel to burn.
Alcor Energy sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Del. Case No. 18-12839) on Dec. 19, 2018. As of
Nov. 30, 2018, the Debtor had total assets of $10,215,664 and total
liabilities of $5,002,071. The Debtor tapped Young Conaway
Stargatt & Taylor, LLP as its legal counsel.
The Bankruptcy Court, at the behest of the Debtor, issued an order
holding that an official committee of unsecured creditors not be
appointed in the Chapter 11 case.
AMANECER PRIMARY: Hires Santiago Gonzalez as Accountant
-------------------------------------------------------
Amanecer Primary Home Care, LLC, seeks authority from the U.S.
Bankruptcy Court for the Southern District of Texas to employ
Santiago Gonzalez, Jr., CPA, as accountant to the Debtor.
Amanecer Primary requires Santiago Gonzalez to:
(a) assist and prepare the quarterly reports with the IRS;
(b) assist and prepare the quarterly reports with the Texas
Workforce Commission;
(c) assist in the preparation of the annual tax returns for
the IRS; and
(d) prepare the annual Medicare Attendant Wage Report/Cost and
Comparison Report that is filed with the Texas Health and
Human Services Commission, that are necessary in the
ordinary course of Debtor's business effective from
Petition Date.
Santiago Gonzalez will be paid as follows:
(a) a flat fee of $3,500 for the preparation of Debtor's 2018
annual IRS Tax Return;
(b) a flat fee of $925 for the preparation of Debtor's 2018
Medicare Attendant Wage Report/Cost and Comparison Report
that is filed with the Texas Health and Human Services
Commission;
(c) a monthly fee of $350 for the preparation of: (i) the IRS
quarterly reports, and (ii) the Texas Workforce quarterly
reports.
Santiago Gonzalez agrees to a $7,500 cap for entire period in which
this chapter 11 case if active.
Santiago Gonzalez will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Santiago Gonzalez, 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 Debtors and their/its estates.
Santiago Gonzalez can be reached at:
Santiago Gonzalez
1307 S Closner Blvd
Eidenburg, TX 78539
Tel: (956) 383-5378
About Amanecer Primary Home Care
Amanecer Primary Home Care LLC is a home health care services
provider in Mission, Texas.
Amanecer Primary Home Care filed a Chapter 11 petition (Bankr. S.D.
Tex. Case No. 19-70131) on April 12, 2019. In the petition signed
by Yuridia F. Alvarez, president, the Debtor disclosed $694,052 in
assets and $1,092,849 in liabilities. Jana Smith Whitworth, Esq.,
of JS Whitworth Law Firm, PLLC, serves as bankruptcy counsel to the
Debtor.
AMERICA-CV STATION: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Two affiliates that have filed voluntary petitions seeking relief
under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
America-CV Station Group, Inc. 19-16355
13001 NW 107th Ave.
Hialeah Gardens, FL 33018
Caribevision Holdings, Inc. 19-16359
13001 NW 107th Ave.
Hialeah Gardens, FL 33018
Business Description: America-CV Station and Caribevision Holdings
are privately held companies primarily in
the television station ownership and program
production business.
Chapter 11 Petition Date: May 14, 2019
Court: United States Bankruptcy Court
Southern District of Florida (Miami)
Judge: Hon. Jay A. Cristol
Debtors' Counsel: Paul J. Battista, Esq.
GENOVESE JOBLOVE & BATTISTA, P.A.
100 SE 2 St #4400
Miami, FL 33131
Tel: (305) 349-2300
Fax: (305) 349-2310
Email: pbattista@gjb-law.com
- and -
FLETCHER, HEALD & HILDRETH, P.L.C.
America-CV Station's
Estimated Assets: $10 million to $50 million
America-CV Station's
Estimated Liabilities: $1 million to $10 million
Caribevision Holdings'
Estimated Assets: $10 million to $50 million
Caribevision Holdings'
Estimated Liabilities: $1 million to $10 million
The petitions were signed by Carlos Vasallo, authorized
representative.
Full-text copies of the petitions are available for free at:
http://bankrupt.com/misc/flsb19-16355.pdf
http://bankrupt.com/misc/flsb19-16359.pdf
A. List of America-CV Station's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Dorta & Ortega P.A. $500,660
3860 SW 8th St. PH
Miami, FL 33134
2. ESRT Empire State $310,897
Building, LLC
111 W. 33rd St, 12th Floor
New York, NY 10120
3. Secretario de $68,948
Hacienda DRN
PO BOX 9024141
San Juan, PR
00902-4140
4. Autoridad de $58,555
Energia Electrica de PR
P.O. BOX 363508
San Juan, PR
00936-3508
5. BMI $21,303
P.O. Box 637500
Cincinnatti, OH
45263-7500
6. Televicentro de $20,735
Puerto Rico
State RD 19
KM 0.5
Guaynabo, PR
00966
7. Zorimari LLC $17,000
Industrial Minillas
111 Suite 2
Carr. 174
Bayamon, PR
00959-1910
8. Win Access Inc. $7,765
P.O. Box 1939
Luquillo, PR 00773
9. Ophira Corp $7,200
RR 11 Box 5912
HH Bo. Nuevo
Bayamon, PR 00956
10. Osnet Wireless Corp. $5,199
P.O. Box 819
Humacao, PR
00792-0819
11. The Power Place, Inc. $4,000
P.O. Box 2060
Carolina, PR
00984-2060
12. Mays Ochoa $3,954
Westgate Industrial Park
Street 2 #515
Barrio Palmas
Catano, PR 00962
13. Corporacion de $3,500
Fondo de Seguro
del Estad
PO Box 42006
Minillas Station
San Juan, PR
00940-2006
14. Mediafax $3,500
PO Box 364505
San Juan, PR
00936-4505
15. Marcos Montalvo $3,000
PO Box 628
Penuelas, PR 00624
16. Director of Finance $2,225
of San Juan
P.O. BOX 70179
San Juan, PR 00936
17. Manaen Lopez $1,275
P.O. Box 9198
Plaza Carolina
Carolina, PR 00988
18. International Broadcast $1,200
Corporation
Calle Bori 1554
San Juan, PR 00927
19. Ismael Ortiz Aponte $1,050
PO Box 25133
San Juan, PR 00928
20. Wanda M. Ojeda Torres $895
Con. Coral Beach
Apt 19-12
Torre I Carolina, PR
00979
B. List of Caribevision Holdings's Eight Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Dorta & Ortega P.A. $500,660
3860 SW 8th St. PH
Miami, FL 33134
2. ESRT Empire State $246,000
Building, LLC
111 W. 33rd St
12th Floor
New York, NY 10120
3. America Teve $0
Network, Inc.
Attn: Etan Mark, Esq.
80 SW 8th St.
Miami, FL 33130
4. Okeechobee Television $0
Corporation
Attn: Etan Mark, Esq.
80 SW 8th St.
Miami, FL 33130
5. Omar Alejandro Saul Romay $0
Attn: Etan Mark, Esq.
80 SW 8th St.
Miami, FL 33130
6. Promisa, Inc. $0
Attn: Etan Mark, Esq.
80 SW 8th St.
Miami, FL 33130
7. Sherjan Broadcasting, Inc. $0
Attn: Etan Mark, Esq.
80 SW 8th St.
Miami, FL 33130
8. Telecenter, Inc. $0
Attn: Etan Mark, Esq.
80 SW 8th St.
Miami, FL 33130
ARCIMOTO INC: Incurs $3.06 Million Net Loss in First Quarter
------------------------------------------------------------
Arcimoto, 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 $3.06 million on $2,645 of total revenues
for the three months ended March 31, 2019, compared to a net loss
of $2.04 million on $656 of total revenues for the three months
ended March 31, 2018.
As of March 31, 2019, the Company had $15.32 million in total
assets, $6.21 million in total liabilities, and $9.10 million in
total stockholders' equity.
As of March 31, 2019, the Company had approximately $4,883,000 in
cash and cash equivalents representing a decrease in cash and cash
equivalents of approximately $20,000 from Dec. 31, 2018. Sources of
cash were predominantly from the sale of equity. The Company
anticipates that its current sources of liquidity, including cash
and cash equivalents, together with its current projections of cash
flow from operating activities, will provide it with liquidity
through the third quarter of 2019.
Arcimoto said, "We need to successfully raise funds in the
short-term; however, this is subject to market conditions and
recognizing that we cannot be certain that additional funds would
be available to us on favorable terms or at all. The amount and
timing of funds that we may raise is undetermined and could vary
based on a number of factors, including our ongoing liquidity
needs, our current capitalization, as well as access to current and
future sources of liquidity.
"We have invested approximately $6,190,000 into leasehold
improvements, tooling and manufacturing capital expenditures for
our current FUV production facility. At this time, we believe
minimal further investment into tooling and manufacturing is
required until we need to expand production capacity beyond a rate
of 10,000 vehicles per year. As we ramp up production, we may
identify opportunities for reducing cost of goods sold that may
require additional capital expenditures."
During the three months ended March 31, 2019, cash used in
operating activities was approximately $3,960,000, which was
primarily the result of its net loss incurred of approximately
$3,068,000, an increase in other current assets of $492,000, a
decrease in accounts payable of approximately $320,000 and an
increase in inventories of approximately $862,000 related to
materials for its electric vehicles. These increases in cash
outflows were partially offset by stock-based compensation of
approximately $96,000, customer deposits of approximately $422,000,
depreciation expense of approximately $171,000, and the
amortization of capital debt of approximately $81,000.
Cash flows from investing activities primarily relates to the
capital expenditures to support the Company's growth in operations,
including investments in manufacturing equipment and tooling.
During the three months ended March 31, 2019, the Company received
approximately $18,000, net of financing in a sale lease back, for
manufacturing equipment and tooling. No FUVs were placed into
company service or included in its rental fleet.
During the three months ended March 31, 2019, net cash provided by
financing activities was approximately $3,922,000, compared to net
cash used of $46,000 during the three months ended March 31, 2018.
Cash flows used in financing activities during the three months
ended March 31, 2019 mainly comprised of payments on capital lease
obligations amounting to approximately $93,000, offering costs of
approximately $271,000 offset by a $16,000 credit to legal fees
previously recorded in offering cost, and proceeds from the
issuance of its common stock through its S-3 of $3,400,000 and
through a Series 4(a)(2) offering of approximately $865,000.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/yDla3N
Arcimoto, Inc.
Headquartered in Eugene, Oregon, Arcimoto, Inc. (NASDAQ: FUV) --
http://www.arcimoto.com/-- is devising new technologies and
patterns of mobility that together raise the bar for environmental
efficiency, footprint and affordability. Available for pre-order
today, Arcimoto's Fun Utility Vehicle, Rapid Responder, and
Deliverator are some of the lightest, most affordable, and most
appropriate electric vehicles suitable for everyday transport.
Arcimoto reported a net loss of $11.05 million for the year ended
Dec. 31, 2018, compared to a net loss of $3.31 million for the year
ended Dec. 31, 2017. As of Dec. 31, 2018, the Company had $14.08
million in total assets, $6.01 million in total liabilities, and
$8.06 million in total stockholders' equity.
In its report dated March 29, 2019, on the Company's consolidated
financial statements for the year ended Dec. 31, 2018, dbbmckennon,
in Newport Beach, California, the Company's auditor since 2016,
expressed substantial doubt about the Company's ability to continue
as a going concern. The auditor noted that Arcimoto has not
achieved positive earnings and operating cash flows from its
intended operations.
ARIZONA SOUTHWEST: Plan Outline OK'd; Plan Hearing Set for June 13
------------------------------------------------------------------
Bankruptcy Judge Scott H. Gan approved Arizona Southwest Patrol,
LLC's disclosure statement regarding its plan of reorganization
dated Feb. 22, 2019.
The Court will consider whether to confirm the Plan at a hearing on
June 13, 2019 at 2:00 p.m. The Confirmation Hearing will be held in
Courtroom 1 at the U.S. Bankruptcy Court, John M. Roll United
States Courthouse, 98 W. 1st Street, Yuma, AZ 85364, with video
available at the United States Bankruptcy Court, 230 N. First
Avenue, 3rd Floor, Courtroom 301, Phoenix, AZ 85003.
Written objections to confirmation of the plan, and ballots
accepting or rejecting the plan must be filed by June 6, 2019.
The Troubled Company Reporter previously reported that unsecured
creditors will get $9,000 in five annual payments.
A copy of the Disclosure Statement is available at
https://tinyurl.com/y4hkadwy from Pacermonitor.com at no charge.
Arizona Southwest Patrol, LLC filed for chapter 11 bankruptcy
protection (Bankr. D. Ariz. Case No. 18-14462) on Nov. 28, 2018,
and is represented by Thomas Allen, Esq. of Allen Barnes & Jones,
PLC.
AUTOCANADA INC: S&P Cuts Issuer Credit Rating to 'B'; Outlook Neg.
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on AutoCanada
Inc. to 'B' from 'B+'.
S&P also lowered its issue-level rating on the company's C$150
million senior unsecured notes outstanding due 2021 to 'CCC+' from
'B-'. The '6' recovery rating on the notes is unchanged.
"The downgrade primarily reflects our view of AutoCanada's
higher-than-expected operating expenses and the slowing demand for
new vehicle sales in Canada. We believe this should contribute to
adjusted debt-to-EBITDA of about 6x in 2019, which is above our
previously stated downgrade trigger of 5x," S&P said.
"The negative outlook primarily reflects uncertainty in the company
achieving the meaningful improvements in earnings and free cash
flow we anticipate over the next 12 months," S&P said, adding that
falling short of these expectations potentially due to operational
missteps or a weaker macroeconomic environment could result in a
breach of the company's financial covenants or increase its
refinancing risks
S&P said it could lower the ratings on AutoCanada over the next 12
months if the company does not address its debt maturity profile
(substantially all of its debt matures in the first half of 2021).
The rating agency also said it could lower the rating if adjusted
debt-to-EBITDA increases above 7x or EBITDA interest coverage falls
below 2x, adding that this could occur if the management team fails
to achieve meaningful operational improvements, new vehicle sales
are lower than expected, or the company makes acquisitions that
contribute to higher debt levels.
"We could revise the outlook to stable within the next 12 months if
the company addresses its debt maturity profile and credit measures
strengthen in line with our forecast. That includes adjusted
debt-to-EBITDA of about 6.0x in 2019 and about 5.0x in 2020, with
adjusted EBITDA interest coverage of 2.5x-3.0x," S&P said. This
could occur if AutoCanada improves its cost profile and deploys
positive free operating cash flow primarily to repay debt
outstanding, according to the rating agency.
AYTU BIOSCIENCE: Incurs $4.5 Million Net Loss in Third Quarter
--------------------------------------------------------------
Aytu Bioscience, Inc., filed with the U.S. Securities and Exchange
Commission on May 14, 2019, its quarterly report on Form 10-Q
reporting a net loss of $4.49 million on $2.37 million of total
revenue for the three months ended March 31, 2019, compared to a
net loss of $2.81 million on $607,473 of total revenue for the
three months ended March 31, 2018.
For the nine months ended March 31, 2019, the Company reported a
net loss of $12.60 million on $5.60 million of total revenue
compared to a net loss of $10.73 million on $2.73 million of total
revenue for the nine months ended March 31, 2018.
The Company has incurred accumulated net losses since inception,
and at March 31, 2019, the Company had an accumulated deficit of
$91.9 million. As of March 31, 2019, the Company had cash, cash
equivalents and restricted cash totaling $14.7 million and other
current assets with an aggregate balance of $3.7 million available
to fund its operations, offset by an aggregate of $2.9 million in
accounts payable and others and accrued liabilities.
As of March 31, 2019, Aytu Bioscience had $38.33 million in total
assets, $22.30 million in total liabilities, and $16.03 million in
total stockholders' equity.
During the nine months ended March 31, 2019, the Company's
operating activities used $10.4 million in cash, which was less
than the reported net loss of $12.6 million. Its cash use was
lower than its reported net loss due to an increase in accrued
liabilities, accrued compensation expense and interest payable,
along with the recognition of non-cash expenses such as
depreciation, amortization and accretion, stock-based compensation,
and restricted stock. These were offset by derivative income, an
increase in accounts receivable, inventory and prepaid expenses and
other.
During the nine months ended March 31, 2019, the Company used
$860,000 of cash for investing activities to purchase fixed and
operating assets, paid $109,000 in contingent consideration, and
received a $3,000 refund of its deposit for office space.
Net cash provided by financing activities in the nine months ended
March 31, 2019 was $19.0 million. This was primarily related to
the October 2018 public offering of $15.2 million, offset by the
offering cost of $1.5 million which was paid in cash. In addition,
the Company received proceeds of $5 million from the Note. The
Company also received proceeds of $259,000 from warrant exercises.
Josh Disbrow, CEO of Aytu BioScience commented, "Fiscal Q3 2019 was
another record quarter for Aytu, and our fourth sequential quarter
of significant revenue growth. Revenue grew nearly 300%, over Q3
2018, to the highest level in company history. Importantly, we saw
increased contribution across our newly diversified portfolio
following the recent additions of ZolpiMist and Tuzistra XR, while
continuing to drive Natesto prescriptions and revenue. The company
has successfully transitioned over the last twelve months, now
commercializing four products with a combined total addressable
market of approximately $7 billion. While Natesto continues to be
the biggest percentage of revenue, with another increase in revenue
this quarter, we are excited by Tuzistra XR getting off to a good
start, and the growing contribution from ZolpiMist and MiOXSYS."
Mr. Disbrow continued, "We also added several value drivers during
the quarter, and subsequent to the close of Q3. We announced our
partnership with SUDA, sublicensing the global distribution rights
for ZolpiMist, for which they are already pursuing regulatory
approval in Australia. Additionally, we continue to receive good
news on the Natesto Spermatogenesis Study, which is investigating
the impact of Natesto, the only FDA approved, nasally-administered
testosterone treatment, on the preservation of fertility
parameters. Interim results demonstrated preservation of semen
parameters after six months of Natesto treatment. Of the 56
subjects enrolled to date, 43 subjects have completed one month of
Natesto therapy, 23 subjects have completed three months, and 15
subjects have completed the full six-month treatment period
equivalent to two cycles of spermatogenesis. The entire study
group is expected to complete the full six-month treatment period
during summer 2019, and the full data will be reported soon
thereafter. Finally, MiOXSYS, our proprietary male infertility
diagnostic platform that we market primarily overseas, continues to
make outstanding progress in developing the global market for this
one-of-kind clinical device and is contributing meaningful revenue
to further broaden our revenue mix."
Mr. Disbrow concluded, "Taken as a whole, we are encouraged by the
strong performance of our core product portfolio, the operational
progress we’ve made across our key strategies, as well as the
potential of our licensing and development initiatives."
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/u2CrXo
About Aytu BioScience
Englewood, Colorado-based Aytu BioScience, Inc. (OTCMKTS:AYTU) --
http://www.aytubio.com/-- is a commercial-stage specialty
pharmaceutical company focused on global commercialization of novel
products addressing significant medical needs. The company
currently markets Natesto, the only FDA-approved nasal formulation
of testosterone for men with hypogonadism, ZolpiMist, an
FDA-approved, commercial-stage prescription sleep aid indicated for
the short-term treatment of insomnia characterized by difficulties
with sleep initiation, and recently acquired Tuzistra XR, the only
FDA-approved 12-hour codeine-based antitussive oral suspension.
Additionally, Aytu is developing MiOXSYS, a novel, rapid semen
analysis system with the potential to become a standard of care for
the diagnosis and management of male infertility caused by
oxidative stress. MiOXSYS is commercialized outside of the U.S.
where it is a CE Marked, Health Canada cleared, Australian TGA
approved, Mexican COFEPRAS approved product, and Aytu is planning
U.S.-based clinical trials in pursuit of 510k de novo medical
device clearance by the FDA. Aytu's strategy is to continue
building its portfolio of revenue-generating products, leveraging
its focused commercial team and expertise to build leading brands
within large, growing markets.
Aytu Bioscience reported a net loss of $10.18 million for the year
ended June 30, 2018, compared to a net loss of $22.50 million for
the year ended June 30, 2017. As of Dec. 31, 2018, Aytu Bioscience
had $42.39 million in total assets, $22.50 million in total
liabilities, and $19.89 million in total stockholders' equity.
EKS&H LLLP, in Denver, Colorado, the Company's auditor since 2015,
issued a "going concern" qualification in its report on the
consolidated financial statements for the year ended June 30, 2018,
citing that the Company has suffered recurring losses from
operations and has an accumulated deficit that raise substantial
doubt about its ability to continue as a going concern.
BIOSTAGE INC: Incurs $1.92 Million Net Loss in First Quarter
------------------------------------------------------------
Biostage, Inc. filed with the U.S. Securities and Exchange
Commission on May 14, 2019, its Quarterly Report on Form 10-Q
reporting a net loss of $1.92 million on $0 of revenues for the
three months ended March 31, 2019, compared to a net loss of $1.54
million on $0 of revenues for the three months ended March 31,
2018. The $0.4 million year-over-year increase in net loss was
attributable primarily to a $0.5 million increase in research and
development costs and a $0.1 million decrease in non-cash expense
from change in the fair value of warrants.
The Company has incurred operating losses since inception, and as
of March 31, 2019 the Company had an accumulated deficit of
approximately $57.7 million. The Company is currently investing
significant resources in the development and commercialization of
its products for use by clinicians and researchers in the field of
regenerative medicine. As a result, the Company expects to incur
operating losses and negative operating cash flow for the
foreseeable future.
As of March 31, 2019, Biostage had $2.33 million in total assets,
$1 million in total liabilities, and $1.33 million in total
stockholders' equity.
At March 31, 2019, the Company had cash on-hand of $1.1 million and
no debt. The Company used net cash in operations of approximately
of $1.2 million during the quarter ended March 31, 2019.
During the three months ended March 31, 2019, the Company also
issued 500,000 shares of common stock to an investor in connection
with the exercise of a portion of warrants that were issued on Dec.
27, 2017. Those warrants were exercised in exchange for an
aggregate cash exercise price of $1.0 million. Subsequent to the
end of the quarter, the Company issued an additional 500,000 shares
of common stock to the same investor in exchange for warrant
exercises. Those warrants were exercised in exchange for an
aggregate cash exercise price of $1.0 million.
During the first quarter of 2019, the Company advanced its
operating programs aimed at bringing its potentially life-changing
Cellframe technology to underserved patient populations. During the
quarter, the Company:
* Announced that Dennis Wigle, M.D., Ph.D, chair of thoracic
surgery at Mayo Clinic in Rochester, Minnesota, detailed for
the first time a single-patient case report that describes
the use of a Biostage Cellspan Esophageal Implant to repair
the patient's esophagus following esophageal reconstruction
associated with the removal of a tumor mass in the chest.
Dr. Wigle announced the details speaking at the Tech-Con
2019 meeting hosted by the Society of Thoracic Surgeons on
Jan. 26, 2019.
Biostage is focused on preparing to file its first Investigational
New Drug (IND) application with the U.S. Food and Drug
Administration (FDA) in the third quarter, seeking approval to
start a Phase 1 clinical trial for the Company's pioneering
Cellspan Esophageal Implant (CEI) product candidate.
Company CEO Jim McGorry commented, "Operationally, we had a strong
first quarter of 2019 and are confident in our growing body of data
to support our IND filing in esophageal disease in the coming
months. We've been meeting with key thought leaders in the field
at leading institutions as we do the necessary legwork to lay the
foundation for our planned clinical trials. Physician feedback has
been positive and continues to shape our development. Our
pre-clinical and clinical results continue to show that our
Cellspan implant stimulates a positive wound healing response in
the patient and enables the body to reconstruct short-segment gaps
in the esophagus with a regenerative tissue response."
McGorry also noted the pattern of consistency among the Company's
preclinical studies and highlighted Biostage CSO Dr. William
Fodor's recent presentation at a major industry meeting where he
discussed the successful first use of a CEI in a human by the Mayo
Clinic in 2017. He stated, "The meeting hosted in Madrid by the
Alliance for Rege nerative Medicine this past April was a great
opportunity for Dr. Fodor to talk about the science behind our
groundbreaking technology. As he discussed in that presentation,
the pattern and timing of regeneration has been consistent between
our juvenile piglet model for esophageal atresia, the pig model for
esophageal disease, and the 75-year-old human treated at Mayo
Clinic."
McGorry added, "Product readiness and clinical evidence support our
upcoming IND filing - everything we've been working on for the past
several years has led up to this moment, so it's an exciting time
for Biostage."
Mr. McGorry also reiterated the vital role offered by the Company's
strategic investors in Asia and the U.S., stating the Company is
"fortunate to have such key relationships" with its financial
backers. The Company's financial investors have extensive
relationships in Asia and the Company is currently working to
establish its business in China, where esophageal cancer incidence
is approximately 15 times greater than in the United States.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/jzN707
About Biostage
Headquartered in Holliston, Massachusetts, Biostage, Inc., formerly
Harvard Apparatus Regenerative Technology, Inc. --
http://www.biostage.com/-- is a biotechnology company developing
bio-engineered organ implants based on the Company's new Cellframe
technology which combines a proprietary biocompatible scaffold with
a patient's own stem cells to create Cellspan organ implants.
Cellspan implants are being developed to treat life-threatening
conditions of the esophagus, bronchus or trachea with the hope of
dramatically improving the treatment paradigm for patients. Based
on its pre-clinical data, Biostage has selected life-threatening
conditions of the esophagus as the initial clinical application of
its technology.
Biostage repored a net loss of $7.52 million on $0 of revenues for
the year ended Dec. 31, 2018, compared to a net loss of $11.91
million on $0 of revenues for the year ended Dec. 31, 2017. As of
Dec. 31, 2018, the Company had $2.63 million in total assets,
$662,000 in total liabilities, and $1.97 million in total
stockholders' equity.
In its report dated March 29, 2019, RSM US LLP, in Boston,
Massachusetts, the Company's auditor since 2018, issued an opinion
on the Company's consolidated financial statements for the year
ended Dec. 31, 2018, expressing substantial doubt about the
Company's ability to continue as a going concern. The auditor
stated that the Company has suffered recurring losses from
operations, has an accumulated deficit, uses cash flows in
operations, and will require additional financing to continue to
fund operations.
BUCKEYE PARTNERS: Moody's Reviews Ba1 Jr. Sub. Notes for Downgrade
------------------------------------------------------------------
Moody's Investors Service placed Buckeye Partners, L.P.'s Baa3
senior unsecured rating and Ba1 junior subordinated notes rating on
review for downgrade. The rating action follows the company's
announcement that it is being acquired by IFM Investors (unrated),
an Australian private infrastructure investment firm, in an
all-cash transaction for $10.3 billion in enterprise value.
"The review for downgrade will evaluate the possibility that
Buckeye's leverage will increase and the financial policy become
less conservative once the going private transaction closes, among
other considerations" said Arvinder Saluja, Moody's
Vice-President.
On Review for Downgrade:
Issuer: Buckeye Partners, L.P.
Junior Subordinated Notes, Placed on Review for Downgrade,
currently Ba1
Senior Unsecured Notes, Placed on Review for Downgrade, currently
Baa3
Outlook Actions:
Issuer: Buckeye Partners, L.P.
Outlook, Changed To Rating Under Review From Stable
RATINGS RATIONALE
The review for possible downgrade will focus on financing plans for
the acquisition and Buckeye's capital structure, financial policy,
and strategic direction under new ownership. Moody's expects that
the transaction will increase Buckeye's leverage, but no details
are yet available. The existing triggers for a possible downgrade
include debt/EBITDA approaching 5x and distribution coverage
approaching 1x, leaving Buckeye with just half a turn of leverage
cushion based on its current expectation of 4.5X debt/EBITDA for
2019.
The transaction is expected to close in the fourth quarter of 2019,
subject to unitholder and regulatory approvals. Moody's expects to
conclude the review concurrent with the closing of the transaction,
or sooner, if enough clarity emerges regarding Buckeye's
post-acquisition capitalization and strategic plans.
Buckeye Partners L.P., is a publicly-traded master limited
partnership based in Houston, Texas. The company's core, legacy
assets are its refined products pipeline systems in the Northeast
and Midwest, including complementary terminals. The company also
has wholesale fuel distribution and marketing and domestic and
international terminaling facilities.
CACTUS CIRCLE: Unsecureds to Get 100% Over 36 Months at 12%
------------------------------------------------------------
Cactus Circle Investments, LLC, filed a Chapter 11 Plan and
accompanying disclosure statement.
The Class 2 Creditors, to the extent that their claims are allowed,
shall be paid as follows: Paid over a period of thirty-six (36)
months, the entire 100% of the debt, with 12% interest per year.
The Class 3 Creditor is listed as a disputed debt in the amount of
$444,437.55 and will not be paid. In the event the disputed debt
and objection to their Proof of Claim is disallowed, and are deemed
to be paid a secured creditor, the Debtor shall sell an asset of
the estate to pay this purported secured debt.
The Debtor anticipates that the business will be operated
profitably, and that it will be able to pay the allowed claims of
the creditors in Classes as scheduled and in accordance with
Article V herein.
A full-text copy of the Disclosure Statement dated May 2, 2019, is
available at https://tinyurl.com/yyc74djh from PacerMonitor.com at
no charge.
About Cactus Circle Investments
Cactus Circle Investments LLC sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. W.D. Tex. Case No. 18-53054) on Dec.
28, 2018. At the time of the filing, the Debtor estimated assets
of less than $1 million and liabilities of less than $500,000. The
case is assigned to Judge Craig A. Gargotta. Willis & Wilkins,
LLP, is the Debtor's counsel.
CADIZ INC: Incurs $7.26 Million Net Loss in First Quarter
---------------------------------------------------------
Cadiz 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 and comprehensive loss applicable to common stock of $7.26
million on $109,000 of total revenues for the three months ended
March 31, 2019, compared to a net loss and comprehensive loss
applicable to common stock of $5.97 million on $108,000 of total
revenues for the three months ended March 31, 2018.
As of March 31, 2019, Cadiz had $73.92 million in total assets,
$155.3 million in total liabilities, and a total stockholders'
deficit of $81.41 million.
The Company had working capital of $13.8 million at March 31,
2019.
At March 31, 2019, the Company had no outstanding credit facilities
other than the Senior Secured Debt and the convertible notes.
Cash used in operating activities totaled $4.0 million and $3.9
million for the three months ended March 31, 2019 and 2018,
respectively. The cash was primarily used to fund general and
administration expenses related to our water development efforts.
Cash used in investing activities totaled $165,000 for the three
months ended March 31, 2019, and $502,000 for the three months
ended March 31, 2018. The costs primarily consisted of engineering
and design related to the development of the Water Project.
Cash provided by financing activities totaled $7.9 million for the
three months ended March 31, 2019, compared with cash used for
financing activities of $14,000 for the three months ended March
31, 2018. The 2019 results include $7.9 million of net proceeds
from the issuance of shares under an at-the-market offering.
As of March 31, 2019, the Company had principal and interest
payments aggregating approximately $76.3 million coming due in
March 2020 related to its 7.00% Convertible Senior Notes to the
extent the noteholders, who have the right to convert at any time
into the Company's common stock at a conversion rate of $6.75 per
share, do not convert prior to March 2020 or the Company does not
exercise the option agreements it currently has with parties
holding 99% of its Convertible Senior Notes that allow the Company,
at its sole option, at any time prior to Dec. 5, 2019, to extend
the maturity date of the Convertible Senior Notes to Sept. 5, 2021.
Additionally, the Company's Senior Secured Debt of approximately
$67.1 million as of March 31, 2019, could also become due as early
as December 2019, if the Company has not exercised the option
agreements or the Convertible Senior Notes have not been converted
by that time and the Company's stock price is less than 120% of the
conversion rate and according to additional terms of the debt
agreement. Specifically, the Springing Maturity Date is not
applicable if less than $10 million of original, outstanding
principal related to the Convertible Senior Notes is outstanding at
that time. Further, the Company's option to acquire an additional
124-mile extension of its Northern Pipeline will require an $18
million payment upon completion of certain conditions precedent
under the purchase agreement with El Paso Natural Gas Company. If
the acquisition of the 124-mile segment is not completed, then the
Company's Northern Pipeline opportunities will be limited to the
96-mile segment it already owns. The Company may meet its debt and
working capital requirements through a variety of means, including
extension, refinancing, equity placements, the sale or other
disposition of assets, or reductions in operating costs.
Cadiz said, "Limitations on the Company's liquidity and ability to
raise capital may adversely affect it. Sufficient liquidity is
critical to meet the Company's resource development activities.
Although the Company currently expects its sources of capital to be
sufficient to meet its near-term liquidity needs, there can be no
assurance that its liquidity requirements will continue to be
satisfied. If the Company cannot raise needed funds, it might be
forced to make substantial reductions in its operating expenses,
which could adversely affect its ability to implement its current
business plan and ultimately its viability as a company."
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/LyXKqc
About Cadiz
Founded in 1983 and headquartered in Los Angeles, California, Cadiz
Inc. -- http://www.cadizinc.com/-- is a land and water resource
development company with 45,000 acres of land in three areas of
eastern San Bernardino County, California. Virtually all of this
land is underlain by high-quality, naturally recharging groundwater
resources, and is situated in proximity to the Colorado River and
the Colorado River Aqueduct, California's primary mode of water
transportation for imports from the Colorado River into the State.
The Company's properties are suitable for various uses, including
large-scale agricultural development, groundwater storage and water
supply projects. The Company's main objective is to realize the
highest and best use of its land and water resources in an
environmentally responsible way.
Cadiz Inc. reported a net loss and comprehensive loss of $26.27
million for the year ended Dec. 31, 2018, compared to a net loss
and comprehensive loss of $33.86 million for the year ended Dec.
31, 2017. As of Dec. 31, 2018, Cadiz had $69.30 million in total
assets, $155.54 million in total liabilities, and a total
stockholders' deficit of $86.24 million.
CAMBER ENERGY: Completes Due Diligence on Planned Acquisition
-------------------------------------------------------------
Camber Energy, Inc., has completed its due diligence on Lineal Star
Holdings, www.LinealStar.com, the acquisition target which Camber
is seeking to acquire pursuant to its previously disclosed letter
of intent. Lineal's subsidiaries provide midstream and downstream
pipeline integrity services, specialty construction and field
services.
Louis G. Schott, the interim CEO of Camber noted "We have performed
our necessary diligence on Lineal and are in the process of
negotiating final transaction documents and terms."
Mr. Schott added, "Through our diligence, we have become more
excited about the Lineal team, their existing business and their
planned growth."
"Their existing base of business with top tier companies and very
large portfolio, provides opportunities for growth in upstream,
midstream and downstream pipeline services in various basins
throughout the United States."
Mr. Schott further stated, "We also continue to focus on
acquisition targets that could further expand our offerings,
capabilities and opportunities for revenue and growth."
The closing of the Lineal transaction, which is an all-stock
transaction, is subject to customary closing conditions,
negotiation of final transaction documents and transaction terms,
including structuring the transaction to be on a tax free basis,
and other conditions, including, but not limited to the consent of
the holder of our Series C Preferred Stock, executing an agreement
with Camber's Series C Preferred Stock holder amending the Series C
Preferred Stock to alter the conversion rights thereof, and
obtaining the requisite NYSE American approval, which conditions
may not be satisfied in a timely manner, if at all. The
transaction contemplates the issuance of a new series of
convertible preferred stock which will be convertible into 67-70%
of the fully diluted common stock of Camber after shareholder
approval, as required under the applicable NYSE American rules and
requirements. Upon receipt of shareholder approval, it is
contemplated that the shareholders of Lineal will have voting
control of the company.
The transaction may not close timely, on the terms set forth in the
previously executed Letter of Intent, or at all. The transaction
is subject to the conditions above, and the parties contemplate
entering into a definitive agreement in connection with the
transaction in the next fifteen days, which agreement and
definitive terms associated therewith will be included on a Form
8-K filed by the Company.
About Camber Energy
Based in San Antonio, Texas, Camber Energy, Inc. (NYSE American:
CEI) -- http://www.camber.energy/-- is an independent oil and gas
company engaged in the development of crude oil, natural gas and
natural gas liquids in the Hunton formation in Central Oklahoma in
addition to anticipated project development in the Texas Panhandle.
Camber Energy is engaged in the acquisition, development and sale
of crude oil, natural gas and natural gas liquids from various
known productive geological formations, including from the Hunton
formation in Lincoln, Logan, Payne and Okfuskee Counties, in
central Oklahoma; the Cline shale and upper Wolfberry shale in
Glasscock County, Texas; and Hutchinson County, Texas, in
connection with its Panhandle acquisition which closed in March
2018.
Camber Energy reported a net loss of $24.77 million for the year
ended March 31, 2018, compared to a net loss of $89.12 million for
the year ended March 31, 2017. As of Dec. 31, 2018, Camber Energy
had $10.10 million in total assets, $2.48 million in total
liabilities, and $7.62 million in total stockholders' equity.
GBH CPAs, PC's audit opinion included in the company's Annual
Report on Form 10-K for the year ended March 31, 2018, contains a
going concern explanatory paragraph stating that the Company has
incurred significant losses from operations and had a working
capital deficit as of March 31, 2018. These factors raise
substantial doubt about the Company's ability to continue as a
going concern.
CAREVIEW COMMUNICATIONS: Incurs $3.1-Mil. Net Loss in 1st Quarter
-----------------------------------------------------------------
Careview Communications, Inc., filed with the U.S. Securities and
Exchange Commission on May 14, 2019, its Quarterly Report on Form
10-Q reporting a net loss of $3.07 million on $1.47 million of net
revenues for the three months ended March 31, 2019, compared to a
net loss of $4.80 million on $1.58 million of net revenues for the
three months ended March 31, 2018.
As of March 31, 2019, the Company had $8.21 million in total
assets, $89.04 million in total liabilities, and a total
stockholders' deficit of $80.83 million.
The Company's cash position at March 31, 2019 was approximately
$554,000. At March 31, 2019, the Company also had $750,000
included in restricted cash in other assets on the condensed
consolidated balance sheet.
CareView said, "We anticipate that our current resources, along
with cash generated from operations, will not be sufficient to meet
our cash requirements throughout the evaluation period, including
funding anticipated losses and scheduled debt maturities. We
expect to seek additional funds from a combination of dilutive
and/or non-dilutive financings in the future. Because such
transactions have not been finalized, receipt of additional funding
is not considered probable under current accounting standards. If
we do not generate sufficient cash flows from operations and obtain
sufficient funds when needed, we expect that we would scale back
our operating plan by deferring or limiting some, or all, of our
capital spending, reducing our spending on travel, and/or
eliminating planned headcount additions, as well as other cost
reductions to be determined. Because such contingency plans have
not been finalized (the specifics would depend on the situation at
the time), such actions also are not considered probable for
purposes of current accounting standards. Because, under current
accounting standards, neither future cash generated from operating
activities, nor management's contingency plans to mitigate the risk
and extend cash resources through the evaluation period, are
considered probable, substantial doubt is deemed to exist about the
Company's ability to continue as a going concern. As we continue
to incur losses, our transition to profitability is dependent upon
achieving a level of revenues adequate to support its cost
structure. We may never achieve profitability, and unless and
until doing so, we intend to fund future operations through
additional dilutive or non-dilutive financings. There can be no
assurances, however, that additional funding will be available on
terms acceptable to us, if at all."
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/YH01cK
About CareView Communications
CareView Communications, Inc. -- http://www.care-view.com/-- is a
provider of products and on-demand application services for the
healthcare industry, specializing in bedside video monitoring,
software tools to improve hospital communications and operations,
and patient education and entertainment packages. Its proprietary,
high-speed data network system is the next generation of patient
care monitoring that allows real-time bedside and point-of-care
video monitoring designed to improve patient safety and overall
hospital costs. The entertainment packages and patient education
enhance the patient's quality of stay. CareView is dedicated to
working with all types of hospitals, nursing homes, adult living
centers and selected outpatient care facilities domestically and
internationally. The Company's corporate offices are located at 405
State Highway 121 Bypass, Suite B-240, Lewisville, TX 75067.
Careview Communications reported a net loss of $16.07 million for
the year ended Dec. 31, 2018, compared to a net loss of $20.07
million for the year ended Dec. 31, 2017. As of Dec. 31, 2018,
Careview had $8.99 million in total assets, $86.81 million in total
liabilities, and a total stockholders' deficit of $77.81 million.
BDO USA, LLP, in Dallas, Texas, the Company's auditor since 2010,
issued a "going concern" qualification in its report dated March
29, 2019, on the Company's consolidated financial statements for
the year ended Dec. 31, 2018, stating that the Company has suffered
recurring losses from operations and has accumulated losses since
inception that raise substantial doubt about its ability to
continue as a going concern.
CAROLINA HOME: June 12 Plan Confirmation Hearing
------------------------------------------------
The disclosure statement of Carolina Home Solutions 1, Inc., is
conditionally approved.
The hearing on confirmation of the plan is scheduled for Wednesday,
June 12, 2019, at 10:30 AM.
June 7, 2019 is fixed as the last day for filing and serving
written objections to the disclosure statement.
June 7, 2019 is fixed as the last day for filing written
acceptances or rejections of the plan.
June 7, 2019 is fixed as the last day for filing and serving
written objections to confirmation of the plan.
Carolina Home Solutions 1, Inc. filed a voluntary Chapter 11
petition (Bankr. E.D.N.C. Case No. 19-00151) on January 14, 2019,
and is represented by George M. Oliver, Esq., at The Law Offices of
Oliver & Cheek, PLLC.
CHURNEY'S REAL ESTATE: Court Denies Approval of Plan Disclosures
----------------------------------------------------------------
The Bankruptcy Court denies approval of the Disclosure Statement
and Chapter 11 Plan of Churney's Real Estate, Ltd., for lack of
sufficient information to enable parties in interest to make an
informed decision about the plan. The lack of information includes
the Debtor's failure to file the required monthly operating reports
from which financial operations may be ascertained, and the failure
to account for rental income collected and deposited in the bank
account of a related entity.
On January 23, 2019, the First National Bank of Pennsylvania filed
a Motion to Determine Debtor is Subject to the Single Asset Real
Estate Provisions of 11 U.S.C. Section 101(51B).
On March 6, 2019, the Debtor filed a Disclosure Statement and
Chapter 11 Plan.
On March 19, 2019, the United States Trustee filed an Objection to
the Disclosure Statement and Chapter 11 Plan.
On March 22, 2019, the First National Bank of Pennsylvania filed an
Objection to the Disclosure Statement and Chapter 11 Plan.
On March 22, 2019, the First National Bank of Pennsylvania also
filed a Motion for Relief from Stay.
About Churney's Real Estate Ltd.
Churney's Real Estate, Ltd., is a lessor of real estate that owns
four properties in Warrensville Heights, Ohio, which have a total
value of $1.28 million.
Churney's Real Estate sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ohio Case No. 18-17270) on Dec. 7,
2018. At the time of the filing, the Debtor disclosed $1,295,848
in assets and $1,572,667 in liabilities. The case is assigned to
Judge Jessica E. Price Smith. Forbes Law LLC is the Debtor's
counsel.
The Office of the U.S. Trustee on Jan. 18 disclosed in a court
filing that no official committee of unsecured creditors has been
appointed in the Chapter 11 case of Churney's Real Estate, Ltd.
COMMSCOPE HOLDING: S&P Places 'BB-' ICR on CreditWatch Negative
---------------------------------------------------------------
S&P Global Ratings on May 10 placed its ratings on CommScope
Holding Co Inc. on CreditWatch with negative implications,
including the 'BB-' issuer credit rating.
The CreditWatch action follows CommScope's announcement that ARRIS'
revenue fell 12.4% from the prior year, and that EBITDA fell 58.9%
to $85.9 million, due to a reduction in capital spending by certain
large North American network operators, a channel inventory
draw-down, and the impact of transition production out of China due
to tariffs. S&P estimates that pro forma EBITDA was down almost 30%
year over year.
S&P will resolve the CreditWatch listing following a review of the
outlook for the combined business with management, likely within
the next week or two. Any downgrade of the issuer credit rating
would likely be limited to one notch.
COOPER-STANDARD HOLDINGS: S&P Cuts ICR to 'BB-'; Outlook Stable
---------------------------------------------------------------
S&P Global Ratings lowered the issuer credit rating on Tier-1 auto
supplier Cooper-Standard Holdings Inc. to 'BB-' from 'BB'.
At the same time, S&P lowered its issue-level ratings on the
company's senior secured term loan to 'BB+' from 'BBB-' with a '1'
recovery rating (rounded estimate: 90%), and the rating on the
company's unsecured notes to 'B' from 'B+' with a '6' recovery
rating (rounded estimate: 0%).
"Slower volumes at major customers led to weaker profits, cash
flow, and leverage for Cooper-Standard compared to our
expectations. The downgrade reflects our view that this weakness in
credit metrics will persist over the next 12-24 months," S&P said.
The rating agency expressed belief the company would not achieve
targeted operational efficiencies to offset the negative effects of
declining volume and unfavorable product mix in all regions,
increasing pricing pressure from its customers, and higher raw
material costs.
The stable outlook reflects S&P's view that debt to EBITDA is
likely to stay between 3.0x-4.0x with FOCF/debt of at least 5% on a
sustained basis amid volume weakness, higher commodity costs and
ongoing capex requirements.
"We could downgrade Cooper-Standard if EBITDA margins dip below 9%,
it cannot achieve its planned operational efficiencies, or global
light-vehicle production declines significantly over the next 12-18
months. This would prevent the company from sustaining debt to
EBITDA well below 4x and FOCF to debt over 5%," S&P said.
"Though unlikely at least over the next 24 months, we could raise
the ratings if Cooper-Standard is likely sustain to EBITDA margins
approaching 12% should end-market volumes stabilize for its
higher-margin platforms or the company improves operating
efficiencies at its manufacturing facilities. In this scenario,
despite its somewhat higher capex requirements, Cooper-Standard
would need to maintain debt to EBITDA well below 3x and steady FOCF
generation well over 10% on a sustained basis," S&P said.
CORE & MAIN: Moody's Affirms B2 CFR on Long Island Acquisition
--------------------------------------------------------------
Moody's Investors Service affirmed all ratings of Core & Main LP,
including the B2 Corporate Family Rating. The outlook remains
stable.
The affirmation of the ratings follows the announcement that Core &
Main reached a definitive agreement to acquire Long Island Pipe
Supply, Inc., a manufacturer and distributor of pipe, fittings and
valves in the fire protection market, for approximately $220
million. The company plans to fund this acquisition and related
transaction fees and expenses with a $225 million add-on to its
term loan B due 2024. Proforma leverage for year-end 2019 is
projected to be 5.8x, a modest weakening from 5.5x at year-end
2018, but remains adequate for the rating category. The purchase of
Long Island Pipe Supply follows the recent acquisitions of Maskell
Pipe & Supply and DCL Fabrication and Supply earlier this year.
Outlook Actions:
Issuer: Core & Main LP
Outlook, Remains Stable
Affirmations:
Issuer: Core & Main LP
Probability of Default Rating, Affirmed B2-PD
Corporate Family Rating, Affirmed B2
Senior Unsecured Global Notes, Affirmed Caa1 (LGD5)
Senior Secured Term Loan, Affirmed B2 (LGD4 from LGD3)
RATINGS RATIONALE
Core & Main's B2 CFR reflects the company's leading position as a
national water products distributor, solid credit metrics and
strong free cash flow generation. The acquisition of Long Island
Pipe Supply further diversifies the company's product offering and
provides an entrance into the Northeast market, where Core & Main
did not previously have a significant presence. Long Island Pipe
Supply has successfully developed strong overseas supplier
relationships, which should help Core & Main increase new product
offerings in the fire protection segment while generating better
margins. The investment in a fire protection business also helps
balance seasonality in the water products business, which can be
affected by the weather.
Core & Main maintains an active acquisition pipeline and Moody's
expects future transactions to be funded through internally
generated cash flow and revolver borrowings. Liquidity is good and
includes a $700 million upsized five-year ABL facility (currently
undrawn) and free cash flow, which Moody's anticipates will exceed
$100 million in the next year. Both internal and external sources
of liquidity cover basic capital requirements, working capital
needs and required debt amortization over the next twelve months.
The stable outlook incorporates Moody's expectation of the
successful integration of the Long Island Pipe Supply acquisition.
Moody's also anticipates that the company will focus on debt
reduction and continue to generate positive free cash flow.
The rating could be upgraded if the company's credit metrics
improve such that debt to EBITDA declines below 5.0x on a sustained
basis and adjusted EBITA coverage of interest improves closer to
2.5x. In addition, positive ratings movement would be considered
should the company continue to build scale while operating
conditions remain favorable.
The rating could be downgraded if debt to EBITDA increases closer
to 6.5x, EBITA interest coverage declines closer to 1.5x on a
consistent basis or if free cash flow generation turns negative,
which would likely be indicative of weaker operating conditions.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in June 2018.
Core & Main LP, headquartered in Saint Louis, Missouri, is a US
based distributor of water, sewage, drainage, storm water, and fire
protection products. Revenue for the fiscal year ended February 3,
2019 was $3.2 billion.
CORE & MAIN: S&P Affirms 'B+' Issuer Credit Rating; Outlook Stable
------------------------------------------------------------------
S&P Global Ratings said it affirmed its 'B+' issuer credit rating
on St. Louis-based water infrastructure product distributor Core &
Main L.P.
Core & Main is acquiring Long Island Pipe Supply in a transaction
valued at $220 million, plus a $5 million potential earn out. The
company intends to enter into a $225 million add-on to its existing
$1.075 billion term loan due in 2024. Terms, maturity, and
conditions will be identical to the existing term loan. Pro forma
for the transaction, debt-to-EBITDA leverage will be about 5.6x.
S&P said it also affirmed its 'B+' issue-level rating on the
proposed increased term loan with a '3' recovery rating (unchanged)
and its 'B-' rating on the company's $500 million of senior
unsecured notes due in 2025 with a '6' recovery rating.
The affirmation of the 'B+' issuer credit and 'B+' and 'B-'
issue-level ratings on Core & Main reflects the company's solid and
growing position as one of the few nationwide suppliers of water
infrastructure products and parts in the U.S., according to S&P.
"While the industry is still very fragmented, we believe Core &
Main is the largest supplier with about 15%-18% market share, which
we expect will increase as the company continues bolt-on
acquisitions," the rating agency said.
S&P expects Core & Main will improve its EBITDA margin, projected
to exceed 9% following its acquisition of Long Island Pipe, which
will expand its presence in the higher-margin fire protection
products space. Core & Main's margins are higher than those of most
other rated building materials entities, according to the rating
agency.
"Our stable outlook on Core & Main reflects our expectation that
revenues will continue to increase, with mid- to high-single-digit
percentage organic and acquisitive growth. However, we forecast
leverage to remain between 5x and 5.5x over the next 12 months,"
S&P said, adding that sales growth should be driven by very
modestly higher commercial, municipal and residential demand over
the next several years and by the need for investment in water and
sewer infrastructure in the U.S.
S&P said it also expects the company will continue to make modest
market share gains given its increased size and product breadth,
pointing out that leverage could rise above 6x due to debt
financing of further acquisitions but the rating agency would
expect rapid deleveraging back below 6x within several quarters.
The rating agency also expects the company will maintain healthy
EBITDA interest coverage above 3x.
"We view a downgrade as unlikely over the next 12 months given Core
& Main's increasing size and profitability. However, we could lower
our ratings if EBITDA margins deteriorate by 100-150 basis points
(about a 15%-20% decline), lifting debt to EBITDA above 6x, or if
interest coverage falls below 2.5x on a sustained basis," S&P said,
adding that such a scenario could materialize if there is
unexpected high and rapid inflation in steel or resin costs from
rising crude oil prices, along with an inability to increase
prices. The rating agency said it could also lower the rating if
the company takes on a more aggressive financial policy including
large debt-financed dividends.
"We are unlikely to raise the rating in the next year absent a
commitment from owner Clayton, Dubilier & Rice to maintain leverage
well below 5x, as well as improved credit measures with leverage
near 4x and interest coverage approaching 4x. We estimate this
would require organic revenue growth of about 15% over the next 12
months and EBITDA margins of greater than 10%, which would indicate
significant market share gains and profitability," S&P said. The
company could also achieve these levels by dedicating the majority
of free cash flow to debt repayment, according to the rating
agency.
CORNERSTAR WINE: U.S. Trustee Unable to Appoint Committee
---------------------------------------------------------
No official committee of unsecured creditors has been appointed in
the Chapter 11 case of Cornerstar Wine & Liquor, LLC as of May 14,
according to a court docket.
About Cornerstar Wine & Liquor
Cornerstar Wine & Liquor LLC is a distributor of wines, liquors and
beers based in Aurora, Colo.
Cornerstar Wine & Liquor sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Colo. Case No. 19-12135) on March 22,
2019. At the time of the filing, the Debtor had estimated assets
of less than $1 million and liabilities of between $1 million and
$10 million. The case is assigned to Judge Elizabeth E. Brown.
The Debtor tapped Kutner Brinen, P.C. as its legal counsel.
COX LAND & TIMBER: Selling Equipment & Personal Property
--------------------------------------------------------
Cox Land & Timber, Inc., asks the U.S. Bankruptcy Court for the
Northern District of Georgia to authorize the private sale of its
equipment and other personal property.
Prior to the Chapter 11 filings, CLT's equipment inventory was
constantly changing based on its immediate business, contract, and
project needs. Because of its equipment mix and equipment profile,
and the multi-use capabilities of its equipment, it is the norm,
rather than the exception, that CLT routinely receives offers to
purchase such equipment and CLT routinely sells such equipment.
Finally, because CLT's equipment is largely free and clear of
encumbrances and is well-maintained and because it has decades of
experience purchasing, owning, maintaining, valuing, and disposing
of equipment, CLT is positioned to sell its equipment to
arms-length, non-insider buyers for prices at or above fair market
prices and on terms and conditions that favor and protect its
interests. CLT has no incentive to contract otherwise.
Thus, CLT submits that, short of selling all or substantially all
of its equipment and personal property -- something that it is not,
by the Motion, proposing to do -- all of its equipment sales, even
in bankruptcy, would be in the ordinary course of its financial and
business affairs, such that the Bankruptcy Code does not require
CLT to obtain prior court authorization to sell its equipment and
other personal property.
Further, CLT also owns various de minimis, unused, or even
burdensome or inconsequential items of personal property that it
might desire to sell or dispose of and for which Court
authorization would not be necessary and, in fact, would cost more
to obtain authorization for on a motion by motion basis than such
items are worth.
Nevertheless, out of an abundance of caution, the Debtor asks by
the Motion authority to sell its equipment and other personal
property, but not its real property, as sale opportunities arise,
in accordance with the general terms and conditions and notice
procedures proposed.
The Debtor asks authority to sell its Property according to these
general terms and conditions and notice procedures:
a. Type of Sale: Private sale.
b. Type of Property: Personal property, only; all real
property sales will be handled through separate motions, after
notice and a hearing, under Section 363.
c. Purchasers: Arms-length, non-insider parties, only.
d. Price: A fair price as determined by the Debtor's
principal, John B. Cox, based on his extensive experience buying
and selling equipment, with consultations in Mr. Cox's discretion
with commercial equipment buyers and financers.
e. Free and Clear Relief: Any sale requiring free and clear
relief under Section 363(f) will be handled via a separate motion
and not be covered by the Motion or any order granting the Motion.
f. Notice Procedures:
i. The Debtor will give written notice of each proposed
sale to the Notice Parties.
ii. The Debtor will serve the Sale Notices on the Notice
Parties, and will specify the Property to be sold, the identity of
the proposed purchaser, the purchase price, and any material terms
and conditions of the proposed sale.
iii. The Notice Parties will have 10 days from the date
that the Sale Notice is sent to provide the Debtor with a written
objection (including an objection via electronic email) to a
proposed transaction. Any such objection will specify the basis
for the objection and will be addressed to David L. Bury, Jr. at
Stone & Baxter, LLP, 577 Mulberry Street, Suite 800, Macon, Georgia
31201, dbury@stoneandbaxter.com.
iv. If no written objection is received by the Debtor by
5:00 p.m. (ET) on the tenth day following the Sale Notice, then the
Debtor will be authorized to consummate the proposed sale
transaction, and any entities having a lien in the property sold
will be deemed to have consented to the sale.
v. If a Notice Party provides a timely written objection
to the proposed transaction, then the Debtor and such objecting
Notice Party will use good faith efforts to consensually resolve
the objection. If the Debtor and the objecting Notice Party are
unable to reach a consensual resolution, then the Debtor will be
required to seek Court approval of the proposed transaction after
notice and a hearing before consummating the proposed transaction.
g. Report of Sale: The Debtor will file a Report of Sale for
each transaction within seven days after it closes, with such
Report of Sale to satisfy F.R.B.P. 6004(f)(1) and to include an
itemized statement of the property sold, the name of each
purchaser, and the price received for each item.
h. Sale Proceeds: All proceeds will be deposited into the
Debtor's DIP bank account and reported on the Debtor's monthly
operating report.
About Cox Land & Timber
Cox Land & Timber, Inc., is a timber company based in Pike County,
Ga. It appraises timber to determine its value, harvests and buys
timber, and offers cutting and thinning services.
Cox Land & Timber filed a Chapter 11 petition (Bankr. N.D. Ga. Case
No. 18-12425) on Nov. 21, 2018. In the petition signed by John B.
Cox, president and chief executive officer, the Debtor estimated
between $1 million and $10 million in assets and less than $50,000
in liabilities.
The Hon. Homer W. Drake is the case judge. The Debtor tapped Stone
& Baxter, LLP as its bankruptcy counsel, and C. Brian Jarrard, LLC
as its special counsel.
Victor Hartman was appointed as examiner in the Debtor's bankruptcy
case.
CREDIT MANAGEMENT: Unsecured Creditors Estimated to Recoup 17%
--------------------------------------------------------------
Credit Management Association Inc. filed a disclosure statement in
support of its chapter 11 plan of reorganization.
Under the plan, the holders of allowed unsecured claims in Class 5
will receive a pro rata distribution of funds available to payment
of Class 3 and 5 claims. Such funds will consist of 10% of the net
proceeds of the sale of the Las Vegas Real Property, following
payment of costs of sale and satisfaction of all liens and
prorations; and 100% of the proceeds of the Life Insurance
Policies. An initial distribution on Class 5 claims will be paid
within 180 days of the Effective Date, and additional distributions
will be made within 90 days following the receipt of the proceeds
of each of the Life Insurance Policies. The Debtor's best current
estimate is that the total of the payments made over time to Class
5 creditors will be approximately 17%. However, the ultimate
payment to such creditors may vary according to the dollar amount
of claims allowed, and the timing and amount of collection on the
various life insurance policies.
The Debtor plans to continue to operate its business under current
management. The Debtor will continue its cost-cutting efforts,
including downsizing the leased space in California from
approximately 7,223 square feet to approximately 2,000-3,500 square
feet, selling its building in North Las Vegas, and encouraging
employees to work remotely.
A copy of the Disclosure Statement is available at
https://tinyurl.com/y6pblj4j from Pacermonitor.com at no charge.
About Credit Management Association
Credit Management Association, Inc. --
http://creditmanagementassociation.org/-- is a non-profit
association that has served business-to-business companies since
1883. CMA helps credit, collection, and financial decision-makers
get the information and support they need to make fast, accurate
credit decisions. In addition, CMA assists insolvent companies
with workouts or liquidation through cost effective alternatives to
bankruptcy. CMA has 800 members who pay a $495 annual fee for full
membership or a $265 annual fee for an associate membership. CMA
is headquartered in Las Vegas, Nevada.
Credit Management Association, based in North Las Vegas, Nevada,
filed a Chapter 11 petition (Bankr. D. Nev. Case No. 18-16487) on
Oct. 31, 2018. In the petition signed by Kimberly Lamberty,
president and CEO, the Debtor estimated $1 million to $10 million
in both assets and liabilities. The Hon. Mike K. Nakagawa oversees
the case. The Debtor hired Clark Hill, PLLC, as reorganization
counsel. Kurtzman Carson Consultants, LLC, is the claims and
noticing agent.
CYTORI THERAPEUTICS: Posts $3.15 Million Net Loss in First Quarter
------------------------------------------------------------------
Cytori Therapeutics, Inc., filed with the U.S. Securities and
Exchange Commission on May 14, 2019, its Quarterly Report on Form
10-Q reporting a net loss of $3.15 million on $703,000 of product
revenues for the three months ended March 31, 2019, compared to a
net loss of $4.40 million on $731,000 of product revenues for the
three months ended March 31, 2018.
The Company has an accumulated deficit of $417.5 million as of
March 31, 2019. Additionally, the Company used net cash of $3.3
million to fund its operating activities for the three months ended
March 31, 2019. These factors raise substantial doubt about the
Company's ability to continue as a going concern.
Further, the Loan and Security Agreement with Oxford Finance, LCC,
requires maintenance of a minimum of $2.0 million in unrestricted
cash and cash equivalents on hand to avoid an event of default
under the Loan and Security Agreement. Based on the Company's cash
and cash equivalents on hand of approximately $3.9 million at March
31, 2019, the Company estimates that it will need to raise
additional capital and/or obtain a waiver or restructure the Loan
and Security Agreement in the near term to avoid defaulting under
its $2.0 million minimum cash/cash equivalents covenant.
To date, these operating losses have been funded primarily from
outside sources of invested capital including the Company's
recently completed 2018 Rights Offering, its Lincoln Park Purchase
Agreement with Lincoln Park Capital Fund, LLC, the Loan and
Security Agreement and gross profits.
Cytori said, "We have had, and we will continue to have, an ongoing
need to raise additional cash from outside sources to fund our
future clinical development programs and other operations. Our
inability to raise additional cash would have a material and
adverse impact on operations and would cause us to default on our
loan."
As of March 31, 2019, Cytori had $24.61 million in total assets,
$20.75 million in total liabilities, and $3.85 million in total
stockholders' equity.
Operating cash burn for Q1 was approximately $3.3 million.
Cytori is developing two clinical stage chemotherapy drugs.
ATI-0918, a generic version of pegylated liposomal doxorubicin
hydrochloride, is the lead product candidate. The Company plans to
submit a Marketing Authorization Application (MAA) to the European
Medicines Agency (EMA) next year based on a successful
bioequivalence study completed against the European reference drug.
The Company is in the process of completing manufacturing-related
activities to support the MAA and is evaluating commercial partners
for ATI-0918 with a focus on Europe, which has a current estimated
market size of over $120 million.
Cytori is also developing ATI-1123, a patented, albumin-stabilized
pegylated liposomal docetaxel. The Company recently received an
orphan drug designation from the U.S. FDA for small cell lung
cancer and is seeking FDA's 505(b)(2) new drug application (NDA)
and Accelerated Approval pathway.
"The Company's recent divestiture of its cell therapy businesses
allows us to fundamentally reposition and refocus of the Company
around our nanotechnology and oncology drug development," said Dr.
Marc Hedrick, president and chief executive officer of Cytori. We
intend to begin communicating our plan later in Q2."
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/GOkTTB
About Cytori
Based in San Diego, California, Cytori -- http://www.cytori.com/--
is developing, manufacturing, and commercializing
nanoparticle-delivered oncology drugs and autologous
adipose-derived regenerative cell (ADRC) therapies within its
Nanomedicine and Cell Therapy franchises, respectively. Cytori
Nanomedicine is focused on the liposomal encapsulation of
anti-neoplastic chemotherapy agents, which may enable the effective
delivery of the agents to target sites while reducing systemic
toxicity. The Cytori Nanomedicine product pipeline consists of
ATI-0918 pegylated liposomal doxorubicin hydrochloride for breast
cancer, ovarian cancer, multiple myeloma, and Kaposi's sarcoma, a
complex/hybrid generic drug, and ATI-1123 patented
albumin-stabilized pegylated liposomal docetaxel for multiple solid
tumors.
Cytori reported a net loss of $12.63 million for the year ended
Dec. 31, 2018 compared to a net loss of $22.68 million for the year
ended Dec. 31, 2018. As of Dec. 31, 2018, the Company had $23.99
million in total assets, $18.76 million in total liabilities, and
$5.22 million in total stockholders' equity.
BDO USA, LLP, in San Diego, California, the Company's auditor since
2016, issued a "going concern" qualification in its report dated
March 29, 2019, on the Company's consolidated financial statements
for the year ended Dec. 31, 2018, citing that Cytori has suffered
recurring losses from operations that raise substantial doubt about
its ability to continue as a going concern.
EASTERN ILLINOIS UNIVERSITY: Moody's Raises $78MM COPs to B3
------------------------------------------------------------
Moody's Investors Service has upgraded Eastern Illinois
University's $8 million of Auxiliary Financing System bonds to B1
from B2 and $78 million of Certificates of Participation to B3 from
Caa2. Moody's also revised the outlook to stable from negative.
RATINGS RATIONALE
The upgrades reflect notably improved liquidity with the receipt of
fiscal 2017 and 2018 state appropriations, lessening the
university's severe liquidity stress. Further, there are some
indications of enrollment stabilization. Combined with steadier
state funding over the next year and ongoing expense management,
EIU's operating performance has positive prospects for
improvement.
The university's credit profile benefits from its role as a
regionally important provider of higher education, with moderate
scale. However, the university's ratings remain constrained by
still thin operating performance, even with projected improvements.
Modest liquidity, student market challenges and longer term
uncertainty around the stability of state funding given the State
of Illinois' (Baa3 stable) own fiscal challenges constrain EIU's
credit profile. The university relies on the state for over half of
its revenues, including operating appropriations and "on behalf"
payments for pension and other post-retirement benefits.
Operating performance in fiscal 2018 significantly improved over
prior years, driven by the receipt of the funding for operating
appropriations and the state's student need-based financial aid
(MAP) for fiscal 2018 and to "backfill" for 2017. Operating
performance will moderate in the current fiscal 2019 and fiscal
2020, since no back funds are due, and will likely reflect near
break-even operating margins. While state funding is up modestly in
2019 and expected to increase again in 2020, net tuition revenue
declines will continue to challenge operations over the next couple
of years. Expected stabilization of enrollment in fall 2019 should
contribute to the stabilization of net tuition revenue over time.
However, the student market remains highly competitive and aging
facilities, with limited recent capital investment, are a challenge
to the university's strategic position.
The higher B1 rating on the AFS bonds reflects a secured interest
in net auxiliary revenues, with approximately $7 million of
dedicated AFS reserves covering outstanding AFS debt of just $8
million nearly 1.0x time in fiscal 2018. The lower B3 for the COPs
incorporates the unsecured nature of the obligation and ability to
terminate under certain circumstances.
RATING OUTLOOK
The stable outlook reflects expectations of generally stable state
operating appropriations for fiscal 2020 with timing of payments
consistent with fiscal 2019. The stable outlook also reflects
expected improvement in student enrollment, gradual strengthening
of operations, and limited draws on restored liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Multi-year material improvement in the state's fiscal condition
resulting in greater predictability in the amount and timing of
state funding
- Growing enrollment leading to increased net tuition revenue and
decreasing reliance on state funding for operations
- Substantial growth in balance sheet reserves to mitigate
exposure to volatile or declining state funding
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Sustained decline in directly paid state operating support or
benefits provided through "on behalf" payments
- Material weakening of liquidity or inability to maintain sound
operating performance
- Inability to curb enrollment losses leading to sustained net
tuition revenue declines
LEGAL SECURITY
The AFS bonds are secured by the net revenues of the Auxiliary
Facilities System, as well as mandatory student fees and tuition
revenues, subject to the prior payment of operating and maintenance
expenses of the Auxiliary Facilities System, but only to the extent
necessary. There is a rate covenant to provide 2.0x coverage of
maximum annual debt service from pledged revenue, as well an
additional bonds test. There is no debt service reserve fund, and
accumulated surpluses from the UFS system may be used to support
any lawful purpose. In fiscal 2018, MADS coverage from total funds
available for debt service was 43.0x.
The Certificates of Participation are unsecured but payable from
both state-appropriated funds and from budgeted legally available
funds of the university from sources other than state
appropriations, including tuition and fees. The obligation to pay
can be terminated in the event that the university does not receive
sufficient state appropriations and does not have other legally
available funds.
PROFILE
Eastern Illinois University, founded in 1895, is a regional public
university located in Charleston, approximately 50 miles south of
Champaign. EIU offers baccalaureate and master's degrees in
education, business, arts, sciences, and humanities. It reported
enrollment of over 6,200 headcount for fall 2018.
EDGEWELL PERSONAL: S&P Places 'BB' ICR on CreditWatch Negative
--------------------------------------------------------------
S&P Global Ratings placed its 'BB' issuer credit rating on
U.S.-based Edgewell Personal Care Co. on CreditWatch with negative
implications.
The CreditWatch placement reflects S&P's estimate that pro forma
adjusted leverage will increase to about 6.0x, from about 3.5x
presently in the event the proposed $1.37 billion acquisition of
Harry's Inc. by Edgewell closes.
S&P also placed its 'BB' senior unsecured note rating on
CreditWatch with negative implications, saying there is possibility
it could lower the rating on the notes below the level of the
post-CreditWatch resolution issuer credit rating. The rating agency
expressed belief the proposed debt capital structure will likely
include a material amount of priority-secured bank debt, thereby
subordinating the unsecured notes. The existing debt capital
structure is largely unsecured.
While still a good cash flow generator, Edgewell's core wet-shave
business continues to face declining demand primarily because of
reduced shaving frequency and because of intense competition from
industry leader Procter & Gamble Co. and direct-to-consumer (DTC)
rivals such as Dollar Shave Club (owner by Unilever), according to
S&P. The rating agency believes Edgewell's expectation that it
will materially strengthen credit metrics over the next two years
following the acquisition's close hinges on the successful
integration of a potentially high growth but unprofitable
competitor, the realization of significant cost and revenue
synergies associated with the acquisition, as well as the
achievement of project fuel productivity savings at the legacy
Edgewell businesses.
"We expect to resolve the CreditWatch placement closer to the
expected first calendar quarter 2020 closing, and will focus on the
company's ability to successfully integrate Harry's, achieve its
revenue and cost synergies, and strengthen credit metrics," S&P
said, adding that it will also factor in the effect of potential
asset disposals -- namely the feminine care business -- if the
company will consummate such a transaction.
"Assuming no change in our assessment of the business risk, we
could lower the issuer credit rating by more than one notch if we
forecast the company will not be able to reach adjusted leverage
well below 5x within 12 to 18 months from the transaction's close,"
S&P said.
ELDORADO GOLD: Moody's Rates 2nd Lien Notes Due 2024 'Caa1'
-----------------------------------------------------------
Moody's Investors Service assigned a Caa1 rating to Eldorado Gold
Corporation's proposed senior secured second lien notes due 2024.
There is no change to Eldorado's existing ratings including its B3
Corporate Family Rating, B3-PD Probability of Default Rating, B3
Senior Unsecured rating and SGL-3 Speculative Grade Liquidity
Rating. The outlook remains stable.
Proceeds from the proposed $300 million of senior secured second
lien notes will be used in combination with proceeds from the
proposed $200 million first lien secured term loan (unrated), due
2023, and cash, to repay Eldorado's $600 million senior unsecured
notes due December 2020. The Senior Unsecured rating will be
withdrawn on close.
Assignments:
Issuer: Eldorado Gold Corporation
Senior Secured Regular Bond/Debenture, Assigned Caa1 (LGD5)
RATINGS RATIONALE
Eldorado Gold Corporation (B3 CFR) is constrained by its 1) high
costs ($998/ gold-equivalent ozs (GEO) in 2018
(Revenue-EBITDA)/GEO) resulting in weak profitability (EBIT margin
of -1.9% in 2018) and high leverage (6.9x in 2018), 2) changing
strategy at Kisladag coupled with execution risk in its ability to
deliver increased production, 3) relatively high geopolitical risks
related to their assets in Greece, and 4) small scale (362 thousand
GEOs in 2018), that though expected to be higher in 2019 and 2020,
will decline back to 2018 levels because of the short mine life
currently at Kisladag. In January, 2019, Eldorado announced their
decision to continue heap-leaching at Kisladag, and suspended its
mill project, however with the continued strategy shift at the mine
and metallurgical testwork still going on, there is risk in the
company's ability to deliver expected production. Eldorado benefits
from adequate liquidity.
Eldorado has adequate liquidity (SGL-3) over the next twelve
months, with a cash balance of $230 million at March 2019, and an
undrawn $250 million revolving credit facility which matures in
June 2023. The large cash balance will allow Eldorado to fund
Moody's estimated free cash flow consumption of about $40 million
in 2019, as the company still has development capital spending
related to the Lamaque mine. Eldorado's credit facility has
financial covenants, and Moody's expects the company will maintain
covenant headroom.
The stable outlook reflects its expectation that Eldorado has
sufficient liquidity to continue executing on its new heap leach
strategy at Kisladag and potentially improve both leverage and
lower operating costs.
The rating could be upgraded if Eldorado is able to generate
sustained positive free cash flow, and demonstrate stability in its
credit metrics and production profile. An upgrade would also
require that adjusted leverage be sustained below 3x (6.9x at
Q4/18) and operating cash costs (revenue less EBITDA divided by
GEOs) are sustained below $900/oz ($998/GEO in 2018).
Downward rating movement could occur should Eldorado's liquidity
position weaken, Eldorado is unable to increase production at
Kisladag and improve recoveries, whereby the mine is cash flow
generative, or if uncertainty increases over the ability of
Eldorado to address its upcoming debt maturities in 2020.
The proposed senior secured second lien notes are rated one notch
below the Corporate Family Rating under Moody's Loss Given Default
methodology because it ranks behind the $250 million revolver and
the $200 million senior secured first lien term loan (both
unrated).
The principal methodology used in these ratings was Mining
published in September 2018.
Headquartered in Vancouver, Canada, Eldorado Gold Corporation owns
and operates two gold mines in Turkey, the Lamaque mine in Canada,
and a gold mine and lead/zinc/silver mine in Greece. Revenues were
$459 million in 2018.
ELDORADO GOLD: S&P Affirms B Issuer Credit Rating; Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'B' long-term issuer credit rating
on Eldorado Gold Corp., and assigned its 'B' issue-level rating and
'3' recovery rating to the company's proposed US$300 million
second-lien secured notes due 2024.
Eldorado has announced refinancing of its existing US$600 million
unsecured notes due December 2020 with proceeds from the proposed
US$300 million second-lien secured notes, proposed US$200 million
first-lien secured term loan (as part of the new secured credit
facilities), and cash on hand. The proposed transaction reduces the
company's debt by US$100 million, improves the debt maturity
profile, and alleviates the near-term refinancing risks. The
proposed transaction also materially improves the company's
leverage profile, with adjusted debt-to-EBITDA below 3x in 2019.
The company's reduced debt levels post-transaction and S&P's
improved earnings and cash flows expectations over the next 18-24
months following the company's resumption of mining and heap
leaching operations at its Kisladag mine in Turkey underpin the
improvement in financial risk profile. Specifically, S&P expects
Eldorado to generate average adjusted debt-to-EBITDA below 3x and
funds from operations (FFO)-to-debt above 30% through 2020 (the
rating agency does not net cash to arrive at its adjusted debt).
With only a partial year of production contribution from Kisladag
and capital spending incurred to complete the Lamaque mine (Quebec,
Canada) development in 2019, S&P expects free cash flows to be
close to neutral this year. However, with much higher production
from Kisladag and lower capital spending next year, S&P estimates
Eldorado will generate meaningful positive free cash flow in 2020,
which would reduce debt further (through term loan amortization)
and strengthen credit metrics. Although its credit metrics are
strong for the rating, S&P's assessment continues to incorporate
its view of Eldorado's credit metrics sensitivity to gold price
volatility, operational challenges, and risk of ramp-up delays at
Lamaque.
The stable outlook reflects S&P's expectation that Eldorado will
generate adjusted debt-to-EBITDA below 3x over the next 12 months
while maintaining adequate liquidity. It also expects that higher
gold output at Kisladag next year will help Eldorado generate
meaningful positive free cash flows, which will support further
debt reduction.
"We could lower our rating on Eldorado over the next 12 months if
leverage deteriorates such that debt-to-EBITDA exceeds 5x with
significant negative free cash flow generation. This would likely
be due to lower-than-expected production, weaker gold margins, a
slower-than-expected progress at the Lamaque mine, or unforeseen
operational challenges," S&P said.
"Although unlikely, we could raise the rating over the next 12
months if we believe Eldorado will generate and sustain adjusted
debt-to-EBITDA in 2x-3x range, with improved production and cash
flow visibility beyond 2021," S&P said, adding that under this
scenario, it would also expect Eldorado liquidity position to
strengthen to support potential growth projects.
EXCO RESOURCES: Chapter 11 Plan Confirmation Set for June 10
------------------------------------------------------------
The Hon. Marvin Isgur of the U.S. Bankruptcy Court for the Southern
District of Texas will hold a hearing on June 10, 2019, at 9:00
a.m. (Prevailing Central Time), at 515 Rusk Street, Houston, Texas,
77002, to consider confirmation of the third amended settlement
joint Chapter 11 plan of reorganization of EXCO Resource Inc. and
its debtor-affiliates.
The Court approved the adequacy of the Debtors' disclosure
statement explaining the third amended Chapter 11 plan of
reorganization.
Deadline for filing objections of the Debtors' Chapter 11 plan is
on June 4, 2019, at 5:00 p.m. (prevailing Central Time).
The third amended plan discloses that at the hearing considering
adequacy of the Disclosure Statement, the Bankruptcy Court
announced that at the Confirmation Hearing, it intended to make a
condition in the Confirmation Order that the Effective Date be no
later than one year from the date of Confirmation of the Plan.
A copy of the Latest Disclosure Statement dated May 3, 2019 is
available at https://tinyurl.com/y4fl35st from Pacermonitor.com at
no charge.
About EXCO Resources
EXCO Resources, Inc. (otc pink:XCOO) --
http://www.excoresources.com/-- is an oil and natural gas
exploration, exploitation, acquisition, development and production
company headquartered in Dallas, Texas, with principal operations
in Texas, North Louisiana and the Appalachia region. EXCO's
headquarters are located at 12377 Merit Drive, Suite 1700, Dallas,
Texas.
EXCO Resources, Inc., and 14 of its affiliates sought Chapter 11
protection (Bankr. S.D. Tex. Lead Case No. 18-30155) on Jan. 15,
2018. EXCO disclosed total assets of $829.1 million and total debt
of $1.355 billion as of Sept. 30, 2017.
The Debtors' cases are assigned to the Honorable Marvin Isgur.
The Debtors tapped Gardere Wynee Sewell LLP, and Kirkland & Ellis
LLP, as bankruptcy counsel; PJT Partners LP as financial advisor;
Alvarez & Marsal North America, LLC, as restructuring advisor; and
Epiq Bankruptcy Solutions, LLC, as claims agent.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors. The committee is represented by lawyers at
Jackson Walker LLP and Brown Rudnick LLP. Intrepid Partners LLC
and Jefferies LLC serve as the committee's investment bankers.
FALCON HOLDINGS: Voluntary Chapter 11 Case Summary
--------------------------------------------------
Debtor: Falcon V Holdings, L.L.C.
400 Poydras Street, Suite 1100
New Orleans, LA 70130
Business Description: Falcon V Holdings, L.L.C. is a privately
held company in the oil and gas extraction
business.
Chapter 11 Petition Date: May 14, 2019
Court: United States Bankruptcy Court
Middle District of Louisiana (Baton Rouge)
Case No.: 19-10561
Debtor's Counsel: Louis M. Phillips, Esq.
KELLY HART & PITRE
One American Place
301 Main Street, Suite 1600
Baton Rouge, LA 70801
Tel: 225-381-9643
Fax: 225-336-9763
Email: louis.phillips@kellyhart.com
Debtor's
Tax Consultant: KPMG LLP
Debtor's
Restructuring
Advisor: LEFOLDT & COMPANY, P.A.
Debtor's
Financial
Advisor: SEAPORT GLOBAL SECURITIES LLC
Estimated Assets: $0 to $50,000
Estimated Liabilities: $10 million to $50 million
The petition was signed by James E. Orth, chief executive officer.
The Debtor stated it has no unsecured creditors.
A full-text copy of the petition is available for free at:
http://bankrupt.com/misc/lamb19-10561.pdf
FERMARALIZ CORP: Unsecureds to Get 2% in 60 Months Under Plan
-------------------------------------------------------------
Fermaraliz Corp. filed a small business Chapter 11 Plan and
accompanying disclosure statement.
Class 3 - Claims 3, 4, 5 and unsecured portion of claim 2 are
impaired. General Unsecured Claims total $618,997.53. The Debtor
will pay 2% of the allowed unsecured claims to be paid in 60
monthly payments of $217.00 including 2% interest per annum. Total
payout: $12,812.00
Payments and distributions under the Plan will be funded from the
debtor's post petition income from the operation of the business.
A full-text copy of the Disclosure Statement dated May 2, 2019, is
available at https://tinyurl.com/y694dk7e from PacerMonitor.com at
no charge.
About Fermaraliz Corp.
Fermaraliz Corp., based in Coamo, PR, filed a Chapter 11 petition
(Bankr. D.P.R. Case No. 18-06456) on Nov. 1, 2018. In the petition
signed by Jose F. Espada Colon, president, the Debtor disclosed
$389,300 in assets and $1,046,703 in liabilities. The Hon. Edward
A. Godoy oversees the case. Modesto Bigas Mendez, Esq., at Modesto
Bigas Law Office, is the Debtor's bankruptcy counsel.
FREEDOM FOODS: U.S. Trustee Unable to Appoint Committee
-------------------------------------------------------
No official committee of unsecured creditors has been appointed in
the Chapter 11 case of Freedom Foods as of May 13, according to a
court docket.
About Freedom Foods
Freedom Foods sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Minn. Case No. 19-31112) on April 11, 2019. At the
time of the filing, the Debtor had estimated assets of less than
$50,000 and liabilities of less than $1 million.
The case has been assigned to Judge Kathleen H. Sanberg. The
Debtor tapped Joseph W. Dicker PA as its legal counsel.
GARLAND BARBECUE: June 11 Plan Confirmation Hearing
---------------------------------------------------
The Disclosure Statement explaining the Chapter 11 Plan filed by
Garland Barbecue #1, LLC and Farmers Branch Barbecue, LLC, is
conditionally approved.
June 11, 2019 at 10:30 a.m. is fixed for the hearing on
Confirmation of the Plan and Final Approval of the Disclosure
Statement in the Court room of the Honorable Harlin D. Hale, 1100
Commerce Street, 14th Floor, Dallas, Texas.
June 7, 2019 is fixed as the last day for filing and serving
written acceptances or rejections of the Plan in the form of a
ballot.
June 7, 2019 is fixed as the last day for filing and serving
written objections to confirmation of the Plan or the 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 2 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 Debtors anticipate the continued operations of the business to
fund the Plan.
A full-text copy of the Joint Amended Disclosure Statement dated
May 6, 2019, is available at https://tinyurl.com/y5xdkpmk from
PacerMonitor.com at no charge.
The Plan was filed by Eric A. Liepins, Esq., in Dallas, Texas.
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.
GLOBAL ENERGY: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------
Two affiliates that filed voluntary petitions seeking relief under
Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Global Energy Services, Inc. 19-11582
aka GES Utility Services, Inc.
aka Global Equipment Services
fka North Woods Contracting, Inc.
fka North Woods Transport, Inc.
1420 King Street, Suite 401
Alexandria, VA 22314
Global Environmental Solutions, Inc. 19-11583
aka Global Energy Solutions, Inc.
1420 King Street, Suite 401
Alexandria, VA 22314
Business Description: Global Energy provides project development
and construction contracting services. The
company offers access and matting,
electrical utility, environmental, land
clearing, restoration, and transportation
solutions to the gas line, pipeline, utility
and wind power owners, contractors and
private customers.
Chapter 11 Petition Date: May 14, 2019
Court: United States Bankruptcy Court
Eastern District of Virginia (Alexandria)
Judge: Hon. Brian F. Kenney
Debtors' Counsel: Daniel M. Press, Esq.
CHUNG & PRESS, P.C.
6718 Whittier Ave., Suite 200
McLean, VA 22101
Tel: (703) 734-3800
Fax: (703) 734-0590
E-mail: dpress@chung-press.com
Global Energy's
Estimated Assets: $1 million to $10 million
Global Energy's
Estimated Liabilities: $10 million to $50 million
Global Environmental's
Estimated Assets: $1 million to $10 million
Global Environmental's
Estimated Liabilities: $10 million to $50 million
The petitions were signed by Kevin Pomerleau, president.
A full-text copy of Global Energy'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/vaeb19-11582.pdf
A full-text copy of Global Environmental'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/vaeb19-11583.pdf
GOLDEN STATE: Unsecureds to be Paid $30K Under Latest Plan
----------------------------------------------------------
Chapter 11 Trustee John Akard, Jr. filed an amended disclosure
statement in support of a chapter 11 plan of liquidation for Golden
State Holdings, Inc.
This latest filing provides that the only known secured claim is
that of Jackpine/GMB which relates to the $96,479 in the segregated
account. Jason Lane alleges that he has an interest in these funds
held for Jackpine/GMB. The ownership of the funds held in the
segregated count will be determined in connection with the Lane
Adversary and paid accordingly. The Trustee believes that all other
secured claims, including those of the ad valorem taxing
authorities, were paid-in-full in connection with the various sales
of property.
The Allowed Unsecured Claims will be paid $30,000 (approximately
3%) on the Effective Date. The Unsecured Claims may be paid
additional amounts as Judgments are collected and as there is
Available Case. Attached hereto as Exhibit C is a spreadsheet that
summarizes the payments of the anticipated Allowed Administrative
Claims and the potential distributions to the Unsecured Creditors
if the Trustee is successful in recovering on the Judgments. In
addition to the collection of the Judgments, the Trustee
anticipates holding approximately $35,000 to pay for fees and the
Lane Adversary and for costs associated with collecting the
Judgments. Any recovery from the Lane Adversary and remaining funds
on hand, may also increase the amount of Available Cash for
distribution to creditors.
Except for the $30,000 distributed to the Allowed Unsecured
Creditor Claims on the Effective Date, any additional distributions
on the Unsecured Claims will be paid after the United States
Trustee Fees, Priority Tax Claims and Administrative Claims are
paid in full and as there is Available Cash to Disburse to the
Unsecured Claims.
A copy of the Amended Disclosure Statement is available at
https://tinyurl.com/y4fdas9q from Pacermonitor.com at no charge.
A copy of the Amended Plan is available at
https://tinyurl.com/yxq3cw4s from Pacermonitor.com at no charge.
About Golden State Holdings
Golden State Holdings, Inc., filed for Chapter 11 bankruptcy
protection (Bankr. S.D. Tex. Case No. 14-36650) on Dec. 1, 2014,
and was represented by Alex Olmedo Acosta, Esq. of Acosta Law, P.C.
Judge Marvin Isgur presides over the case. John Akard Jr., was
appointed as the Chapter 11 Trustee on Jan. 13, 2015.
GOVERNORS STATE: Moody's Alters Outlook on Ba3 Rating to Stable
---------------------------------------------------------------
Moody's Investors Service has revised Governors State University,
IL's outlook to stable from negative. Moody's has affirmed the Ba3
rating on $5 million of outstanding University Facilities System
Revenue Bonds and the B1 rating on $9 million of outstanding
Certificates of Participation.
RATINGS RATIONALE
The outlook revision to stable from negative reflects GSU's
strengthened liquidity and operating performance following receipt
of full state funding for fiscal 2017 and fiscal 2018. Operating
performance will thin in fiscal 2019 and fiscal 2020, since no back
funds are due, but is expected to outperform recent pre-fiscal 2018
performance. Also incorporated in the outlook revision are its
current expectations for modest increases in state funding from the
State of Illinois (Baa3 stable) over the outlook period, with
direct operating appropriations and "on behalf" benefit payments
representing over half of the university's operating revenue.
Further, while GSU has had three years of consecutive enrollment
declines, primarily driven by losses in graduate enrollment,
management is anticipating flat overall enrollment in fall 2019 due
to relatively stable undergraduate enrollment.
An additional credit consideration is potential longer term
enrollment challenges due to GSU's reliance on students from the
fiercely competitive student market in the City of Chicago (Ba1
stable), with only relatively recent expansion into a full four
year program from upper division only. The university is
comparatively small for a public university, with under 3,400 FTE
students. Continued uncertainty around the long-term stability of
state funding for both operations and pension and other
post-retirement benefits due to the state's own fiscal condition is
a fundamental credit constraint.
The Ba3 rating on GSU's University Facilities System (UFS) bonds
additionally incorporates the secured interest in revenues. The
lower B1 rating on the COPs reflects the unsecured nature of the
pledge and risk of the non-appropriation of state funds. Favorably,
the open-system UFS broadens the reserves and revenue available for
payment on the COPs, when available.
RATING OUTLOOK
The stable outlook reflects expectations of generally stable state
operating appropriations for fiscal 2020 with timing of payments
consistent with fiscal 2019. The stable outlook also reflects
expected stabilizing student enrollment.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Multi-year material improvement in the state's fiscal condition
resulting in greater predictability in the amount and timing of
state funding
- Growing enrollment leading to increased net tuition revenue and
decreasing reliance on state funding for operations
- Substantial growth in balance sheet reserves to mitigate
exposure to volatile or declining state funding
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Sustained decline in directly paid state operating support or
benefits provided through "on behalf" payments
- Material weakening of liquidity or inability to maintain sound
operating performance
- Inability to curb enrollment losses leading to sustained net
tuition revenue declines
LEGAL SECURITY
The UFS bonds are secured by the net revenues of the University
Facilities System, as well as mandatory student fees and tuition
revenues, subject to the prior payment of operating and maintenance
expenses of the system, but only to the extent necessary. There is
a rate covenant to provide 2.0x coverage of maximum annual debt
service from pledged revenue, as well an additional bonds test.
There is no debt service reserve fund, and accumulated surpluses
from the UFS may be used to support any lawful purpose. In fiscal
2018, MADS coverage from total funds available for debt service was
over 16x.
The Certificates of Participation are unsecured but payable from
both state-appropriated funds and from budgeted legally available
funds of the university from sources other than state
appropriations, including tuition and fees. While the COPs
typically benefit from the breadth of revenue available to pay debt
service, recent volatile state appropriations and tighter budgets
weaken this pledge. The obligation to pay can be terminated in the
event that the university does not receive sufficient state
appropriations and does not have other legally available funds.
PROFILE
Governors State University is a four-year regional public
university located approximately 30 miles south of Chicago. As a
key provider of education for first generation college students,
the university implements academic programs geared towards the
specific needs of this population. Fall 2018 enrollment was 3,320
FTE students and total operating revenue was $131 million, as
calculated by Moody's.
GREATER APOSTOLIC: Case Summary & 7 Unsecured Creditors
-------------------------------------------------------
Debtor: Greater Apostolic Faith Temple Church, Inc.
138 28th St.
San Diego, CA 92101
Business Description: Greater Apostolic Faith Temple Church, Inc.
is a religious organization in San Diego,
California.
Chapter 11 Petition Date: May 14, 2019
Court: United States Bankruptcy Court
Southern District of California (San Diego)
Case No.: 19-02820
Debtor's Counsel: David L. Speckman, Esq.
SPECKMAN LAW FIRM
1350 Columbia Street, Suite 503
San Diego, CA 92101
Tel: (619) 696-5151
E-mail: speckmanandassociates@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dwayne Shepherd, pastor/CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's seven unsecured creditors is available for
free at:
http://bankrupt.com/misc/casb19-02820.pdf
GREENPARTS INTERNATIONAL: U.S. Trustee Unable to Appoint Committee
------------------------------------------------------------------
No official committee of unsecured creditors has been appointed in
the Chapter 11 case of Greenparts International, Inc. as of May 13,
according to a court docket.
About Greenparts International
Greenparts International, Inc., is a recycling company with
multiple locations in Atlanta, Georgia. The company filed a
Chapter 11 petition (Bankr. Case No. 19-53617) on March 5, 2019.
The petition was signed by Asif Balagamwala, president. At the
time of filing, the company estimated assets of $1 million to $10
million of the same range.
Judge Paul Baisier presides over the case. The Debtor is
represented by Will B. Geer, Esq. at Wiggam & Geer, LLC.
GUIDED SYSTEMS: Income Stream to Fund Proposed Plan
---------------------------------------------------
Guided Systems Technologies, Inc., filed with the U.S. Bankruptcy
Court for the Northern District of Georgia a small business
disclosure statement in support of its chapter 11 plan dated April
30, 2019.
The Plan will be funded by Debtor's income stream from existing
customers and customers to be obtained in the ordinary course of
business over the life of the Plan. Debtor estimates it will
generate approximately $86,000 for distribution to creditors over
the 5-year life of the Plan. This estimate is reflected in the Plan
Budget in the line item titled "Plan Distribution Fund." The actual
amount of the Plan Distribution Fund may be more or less than the
estimate reflected in the Plan Budget, depending on the
post-petition performance of the reorganized Debtor.
Eighty percent of the Plan Distribution Fund will be allocated to
fund the "Class 3 Fund" to pay allowed general unsecured claims. To
the extent the money in the Administrative Claims Fund and the
Priority Tax Fund are not used in full to pay allowed
administrative or priority tax claims, the unspent amounts will be
reallocated to the Class 3 Fund to be paid to Class 3 creditors.
Distributions from the Class 3 Fund will be made on a semi-annual
basis for a period of 60 months from the Effective Date, with such
payments commencing 12 months after the Effective Date of the Plan.
Class 3 general unsecured claimants with allowed claims will
receive a pro rata share of the Class 3 Fund based on the allowed
amount of each claimant's claims. Debtor will have the option to
prepay these claims prior to the expiration of the 60 month period,
without penalty; provided, however, that the total of the
prepayment amount to each claimant will equal at least the amount
each claimant would receive from its respective Fund over the
60-month duration of the Plan.
A copy of the Disclosure Statement dated April 30, 2019 is
available at https://tinyurl.com/y5ebuaob from Pacermonitor.com at
no charge.
About Guided Systems Technologies
Guided Systems Technologies, Inc., is an engineering firm, with a
focus on defense contracting and flight control, and has been in
business since 1989. Over the past several years, several general
and specific events compounded and led to its current financial
difficulties. It experienced the loss of a large follow-on
engineering defense contract, and did not respond with an immediate
reduction in its workforce and other overhead, resulting in the
incurrence of significant expense without realization of
corresponding revenues.
Guided Systems Technologies sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. N.D. Ga. Case No. 18-61243) on July 5,
2018. At the time of the filing, the Debtor estimated assets of
less than $50,000 and liabilities of $1 million to $10 million.
Judge Sage M. Sigler oversees the case. The Debtor tapped Geiger
Law, LLC, as its legal counsel, and Consilium Partner Group, LLC,
as its accountant.
HEARTLAND DENTAL: S&P Alters Outlook to Negative, Affirms 'B-' ICR
------------------------------------------------------------------
S&P Global Ratings revised its rating outlook on Effingham,
Ill.-based dental support services provider Heartland Dental LLC to
negative from stable and affirmed its 'B-' issuer credit rating.
S&P affirmed the 'B-' issue level rating, with a recovery rating of
'3', on the first-lien debt and the 'CCC' issue rating, with a
recovery rating of '6', on the senior unsecured notes.
The outlook revision to negative reflects the company's increasing
leverage, which has grown to 13.8x in 2018 from 9x in 2017, and
cash outflows due to its increased pace of office expansion through
affiliations and de novos, according to S&P. The rating agency
believes the more aggressive expansion also increases operational
risk.
"The negative outlook reflects our view that Heartland's aggressive
growth strategy heightens operational and financial risk, given the
stress to EBITDA margins, cash flows, and leverage," S&P said.
"We could lower the rating if the company experiences
greater-than-expected deterioration in EBITDA margin, resulting
from difficulties in integrating new offices into its network and
realizing synergies. Such missteps would result in adjusted
leverage further increasing from its already high levels, leading
us to believe that the company's capital structure is
unsustainable," the rating agency said, adding that key metrics
would be if EBITDA margin declines by 200 bps from its 2018 level,
the debt-to-EBITDA ratio does not improve, or EBITDA interest
coverage drops below 1x.
S&P said it could revise the outlook back to stable if the company
demonstrates that it can achieve improvements in its rapidly
growing base of dental offices, resulting in improving EBITDA
margin, cash flows, and financial leverage.
IAA SPINCO: Fitch Assigns First-Time 'BB-' LT IDR, Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has assigned a first time long-term Issuer Default
Rating of 'BB-' to IAA Spinco Inc. In addition, Fitch has assigned
ratings of 'BB+'/'RR1' to IAA's senior first lien secured revolver
and term loan B.
Fitch expects the spin-off of IAA Spinco Inc. from KAR Auction
Services Inc. to be completed by the end of the second quarter of
2019. The post-spin company is expected to have approximately $1.3
billion of outstanding debt including a $900 million term loan B
and $400 million of other unsecured debt.
KEY RATING DRIVERS
IAA Spinco Inc. benefits from a leading market position in the
salvage vehicle auction industry. The company's strong financial
flexibility, cash flow generation and profitability are key drivers
of the 'BB-' rating. Additionally the spin-off from KAR Auction
Services allows the company to invest in further growth initiatives
due to operating in a more stable market. Meanwhile, adjusted
leverage at approximately 4.6x is moderately high for the category,
while customer concentration is also a risk. Fitch also considers
technological advancement in auto safety, including autonomous
vehicles, to be a long-term concern.
Significant Financial Flexibility: Fitch views IAA's financial
flexibility as a main driver of the rating. The standalone company
generated FCF margins of 12% and 17% in 2017 and 2018,
respectively, as a subsidiary of KAR Auction Services. Fitch
expects that the company will continue to generate FCF margins in
excess of 10% annually, which will allow the company to easily meet
regular term loan amortization while continuing to invest in the
business. Additionally, liquidity is expected to remain adequate as
working capital needs are minimal and there are no near-term
maturities until the revolver terminates in 2024 and the term loan
B in 2026.
Fitch believes the company will deploy some of its excess cash flow
to make moderate debt prepayments, while also focusing on growth
initiatives. There is also the possibility that IAA could start to
return a material amount of cash to shareholders in the form of
dividends or share repurchases over time.
High Post Spin-Off Adjusted Leverage: Fitch expects that IAA will
have adjusted leverage (total lease adjusted debt/operating
EBITDAR) and FFO-adjusted leverage of approximately 4.6x and 5.3x,
respectively, following the spin-off from KAR Auction Services.
This is in comparison to gross leverage (total debt/operating
EBITDA) of 3.5x, due to the company's heavy utilization of
operating leases. Fitch expects a portion of excess cash flow will
be used to prepay debt, which, along with regular term loan
amortization, should lead to IAA achieving its net leverage target
of below 3.0x by 2021.
Leading Market Position: IAA is one of the top two players in the
salvage vehicle auction industry, controlling roughly 40% of the
North American market. Its largest competitor, Copart, Inc.,
accounts for an additional 40%. The remaining 20% of the market is
somewhat fragmented and made up of smaller regional companies.
Fitch does not believe there is a material risk of disruption from
another competitor entering the market due to the geographic
footprint and established market place of the incumbents. However,
the company derives approximately 40% of its revenue from cars
sourced through three insurance companies, which exposes the
company to risk from the loss of an important customer.
Positive Growth Trends: Fitch expects the salvage vehicle auction
market to grow by mid-single digits over the next several years,
driven by an aging and growing North American auto market. Fitch
expects IAA's revenue to grow at a similar pace under Fitch's
rating case over the forecast horizon. Annual vehicle miles
travelled in the U.S. have increased steadily since the financial
crisis, and increasing vehicle technology and complexity pose
positive trends for the number and value of salvage vehicles.
Additionally, IAA currently only generates 11% of its revenue from
outside the U.S. and could experience growth from expanding further
into the global market.
High Profitability: IAA benefits from strong profitability, having
generated EBITDA margins of 27% and 29% in 2017 and 2018,
respectively, as a segment of KAR Auction Services. Fitch expects
that additional general and administrative costs associated with
being a standalone company will lead to EBITDA margins sustaining
around 27%. The asset-light business model and moderate capex are
expected to result in significant EBITDA to FCF conversion.
DERIVATION SUMMARY
IAA Spinco Inc. is one of the largest salvage vehicle auction
companies in the United States. The company is comparable in size
and scale with Copart Inc. (NR), its largest competitor. Compared
with auto retailer AutoNation, Inc. (BBB-/Stable) the company has
significantly higher EBITDA and FCF margins, but also materially
higher adjusted leverage and is much smaller. The salvage auction
business has typically remained steady in times of economic
recession, while the auto retailer industry has proven to retract
sharply. No parent/subsidiary linkage, country ceiling or operating
environment constraints were in effect for these ratings.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
123456789012345678901234567890123456789012345678901234567890123456
-- The spinoff is completed in mid-2019, with $900 million of
first lien secured debt issued and $400 million of other
unsecured debt, which is used to pay a dividend to KAR
Auction Services, Inc.;
-- Revenue grows at 3.5% per year driven by continued trends of
a growing North American car fleet and a steady percentage
of total loss claims;
-- EBITDA margins are lower in the forecast period at 27% due
to additional general and administrative costs associated
with being a standalone business;
-- Capex total 5% of annual revenue;
-- IAA maintains adequate liquidity throughout the forecast
period;
-- Working capital fluctuations are minimal and FCF margins
remain around or above 10% through 2022;
-- Approximately $10 million of debt is prepaid per year;
-- The company begins paying a dividend in 2019 after the
spin-off is completed and beings repurchasing shares in 2020.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- Adjusted leverage (total lease-adjusted debt/operating
EBITDAR) sustains below 4.0x;
-- FFO-adjusted leverage sustains below 5.0x;
-- The company increases its geographic diversification and
reduces customer concentration without a material increase
in leverage.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- Adjusted leverage sustains above 5.0x;
-- FFO-adjusted leverage sustains above 6.0x;
-- FCF or EBITDA margins contract significantly to the point
that financial flexibility declines.
LIQUIDITY
Liquidity: Fitch expects IAA's post-spinoff liquidity will to be
sufficient at $275 million, consisting of $50 million in cash and
$225 million available under their revolving credit facility. Due
to the asset-light nature of the business, Fitch believes near-term
liquidity will be able to cover capex and term loan amortization.
Debt Structure: The company's pro forma capital structure consists
of a $225 million revolving credit facility, a $900 million Term
Loan B, and approximately $400 million of other unsecured debt. The
revolving credit facility has a maturity date in 2024, and the term
loan has a maturity due 2026.
FULL LIST OF RATING ACTIONS
Fitch has assigned the following first-time ratings:
IAA Spinco Inc.
-- Long-Term IDR 'BB-';
-- First Lien Secured Revolver 'BB+'/'RR1';
-- First Lien Secured Term Loan B 'BB+'/'RR1'.
IAA SPINCO: S&P Assigns 'BB-' Issuer Credit Rating; Outlook Stable
------------------------------------------------------------------
S&P Global Ratings assigned its 'BB-' issuer credit rating to IAA
Spinco Inc. (IAA), the salvage vehicle division of KAR Auction
Services Inc., and assigned a 'BB' issue-level and '2' recovery
ratings to IAA's secured debt.
KAR is spinning off IAA and is seeking to secure a $225 million
cash flow revolver and a $900 million term B. The company also
plans to issue about $400 million in senior unsecured notes, which
are currently unrated. S&P expects the proceeds from the debt
issuance will be used to fund the payment of a dividend to the
remaining KAR business.
"Our ratings reflect IAA Spinco Inc.'s (IAA's) solid, predictable
business as one of the two leading salvage vehicle auction
providers in North America. IAA's business benefits from recurring
revenue and auction activity, which tends to be countercyclical to
the economy, providing resiliency in downturns," S&P said. "At the
same time, our view of its business is tempered by its relatively
small size compared to similarly rated firms, the sales
concentration among its insurance customers, and the costs and
risks of keeping up-to-date with the latest technologies in order
to be responsive to changing customer needs."
The stable outlook reflects S&P's expectation that IAA will
generate earnings and free cash flow appropriate for the rating
during the year ahead through its relatively consistent revenue
base and tight financial controls. For the rating, S&P expects IAA
to maintain an FOCF-to-debt ratio of at least 10% over the next 12
months
"We could lower our rating if IAA's annualized FOCF falls below 10%
or if total debt to EBITDA exceeds 5x on a sustained basis. This
could occur, for instance, if auction volumes declined due to
heightened competition or if the company pursued an aggressive
course of acquisitions, elevating debt leverage or substantially
reducing availability under the revolving credit facility," S&P
said.
"Ratings upside is unlikely given IAA's relatively modest scale and
customer concentration. Eventually, better operating efficiencies
and well-integrated acquisitions could support a higher rating,"
S&P said. "Alternatively, we could raise the rating if debt to
EBITDA falls below 3.0x and FOCF to debt exceeds 15% on a sustained
basis as the result, for instance, of significant debt reduction."
INOVALON HOLDINGS: S&P Upgrades ICR to 'B+'; Outlook Stable
-----------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on Bowie,
Md.-based health care technology company Inovalon Holdings Inc. to
'B+' from 'B' with a stable outlook.
At the same time, S&P raised its issue-level rating on the senior
secured credit facility to 'B+' from 'B'. S&P's recovery rating on
this debt is unchanged at '3'.
S&P's upgrade on Inovalon reflects improved credit metrics and cash
flow generation following the integration of ABILITY, which the
company acquired in April 2018. Adjusted leverage declined to 6.0x
as of March 31, 2019, from 7.2x at the transaction close. At the
same time, Inovalon generated $43 million of free operating cash
flow (FOCF) despite substantial acquisition- and
integration-related expenses. S&P expects the company to generate
around $60 million of FOCF in 2019 as some of these expenses roll
off and capital requirements decline.
"The stable outlook on Inovalon Holdings Inc. reflects our
expectation for high-single-digit organic revenue growth and free
operating cash flow generation of about $60 million, supported by
continued high customer retention rates of greater than 90%," S&P
said.
INPIXON: Incurs $5.15 Million Net Loss in First Quarter
-------------------------------------------------------
Inpixon filed with the U.S. Securities and Exchange Commission on
May 14, 2019, its Quarterly Report on Form 10-Q reporting a net
loss of $5.15 million on $1.36 million of revenues for the three
months ended March 31, 2019, compared to a net loss of $6.24
million on $849,000 of revenues for the three months ended
March 31, 2018.
As of March 31, 2019, Inpixon had $20.12 million in total assets,
$7.21 million in total liabilities, and $12.90 million in total
stockholders' equity.
Gross profit for the quarter ended March 31, 2019 was $1.0 million,
compared to $584,000 for the comparable period in 2018. The gross
profit margin for the three months ended March 31, 2019 was 75%
compared to 69% for the three months ended March 31, 2018. This
increase in margin is primarily due to the increase in higher
margin IPA revenue during the three months ended March 31, 2019.
Net cash used in operating activities during the three months ended
March 31, 2019 of $3.5 million consists of net loss of $5.2 million
offset by non-cash adjustments of $2.5 million less net cash
changes in operating assets and liabilities of $809,000.
As of March 31, 2019, the Company has a working capital deficiency
of approximately $0.09 million.
The Company said its capital resources as of March 31, 2019,
availability on the Payplant facility to finance purchase orders
and invoices in an amount equal to 80% of the face value of
purchase orders received and funds from higher margin business line
expansion will not be sufficient to fund planned operations during
the next twelve months from the date the financial statements are
issued based on current projections. In addition, the Company is
pursuing possible strategic transactions. Therefore, the Company
may raise such additional capital as needed, through the issuance
of equity, equity-linked or debt securities.
Commenting on the results, Nadir Ali, CEO of Inpixon, said "I am
very pleased with our accomplishments in the first quarter of 2019.
This is the third quarter in a row that our company has reported
quarter-over-quarter sequential revenue growth. Our efforts are
now exclusively focused on the IPA business. This is a rapidly
growing industry (Marketsandmarkets forecasts 42% CAGR over the
2017-2022 period) with higher margins than our legacy business.
Based on our growing sales pipeline, continued channel partner
momentum, on-going conversations with customers and other strategic
initiatives, we expect the growth will continue in 2019. In
addition, we are offering lower cost entry point solutions to our
customers, such as the Inpixon IPA Pod, which will expand the
application of our products into more customer verticals and use
cases. I am very excited about our results for the first quarter
of 2019 and what it reflects about our growth momentum. We not
only delivered a significant increase in both revenue and gross
profit relative to the comparable period in the prior year, we also
significantly increased our gross profit margin percentage and
decreased our net loss," Mr. Ali concluded.
First Quarter 2019 Business Highlights and Recent Developments
* Inpixon announced that its Shoom advertising services
business unit has surpassed 126 million ads in its Shoom
Advertising Information Network (SAIN) eTearSheets solution.
* Inpixon announced its IPA Sensor 4000 was selected to be
used in connection with the development of a "Smart School"
safety network solution intended to equip schools and
campuses with situational awareness and communication
technologies that can enhance safety to create a more
optimal learning environment.
* Inpixon announced the closing of an oversubscribed rights
offering with gross proceeds of $12.0 million.
* Inpixon announced a collaboration with SAS to deliver
advanced analytics for Internet of Things (IoT).
* Inpixon announced it has entered into a two-way reseller
arrangement with Aislelabs, a leading provider of Wi-Fi
location-based marketing and analytics solutions.
* Inpixon announced that the company has been recognized by
Gartner, Inc., an independent research firm, in the 2019
Gartner Magic Quadrant for Indoor Location Services, Global
report.
* Inpixon announced the release of the Indoor Positioning
Analytics (IPA) Connector for IBM MaaS360 with Watson.
* Inpixon announced it has joined the VMware Technology
Alliance Partner (TAP) program as a Standard level partner
and that Inpixon's IPA AirWatch Connector and resources are
in the VMware Solution Exchange.
* Inpixon announced it has received a Notice of Allowance from
the U.S. Patent and Trademark Office allowing its patent
application covering techniques to expedite joins of large
database tables.
* Inpixon announced it has hired Andrew Chapman as VP Sales,
Retail & Entertainment.
* Inpixon announced it has signed a non-binding term sheet to
acquire Locality Systems, a technology company based near
Vancouver, Canada, specializing in wireless device
positioning and radio frequency (RF) augmentation of video
surveillance systems.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/aW0uUx
About Inpixon
Headquartered in Palo Alto, California, Inpixon is a technology
company that helps to secure, digitize and optimize any premises
with Indoor Positioning Analytics (IPA) for businesses and
governments in the connected world. Inpixon Indoor Positioning
Analytics is based on new sensor technology that finds all
accessible cellular, Wi-Fi, Bluetooth and RFID signals anonymously.
Paired with a high-performance, data analytics platform, this
technology delivers visibility, security and business intelligence
on any commercial or government premises worldwide. Inpixon's
products, infrastructure solutions and professional services group
help customers take advantage of mobile, big data, analytics and
the Internet of Things (IoT).
Inpixon reported a net loss of $24.56 million for the year ended
Dec. 31, 2018, compared to a net loss of $35.03 million for the
year ended Dec. 31, 2017. As of Dec. 31, 2018, the Company had
$12.17 million in total assets, $7.37 million in total liabilities,
and $4.80 million in total stockholders' equity.
Marcum LLP, in New York, the Company's auditor since 2012, issued a
"going concern" qualification in its report dated March 28, 2019,
on the Company's consolidated financial statements for the year
ended Dec. 31, 2018, citing that the Company has a significant
working capital deficiency, has incurred significant losses and
needs to raise additional funds to meet its obligations and sustain
its operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
INT'L MANUFACTURING: Court Dismisses Trustee Complaint vs WII
-------------------------------------------------------------
District Judge Morrison C. England, Jr., dismisses with prejudice
Plaintiff's complaint against Wings Insurance, Inc. in the case
captioned BEVERLY N. McFARLAND, Chapter 11 Trustee for
International Manufacturing Group, Inc., Plaintiff, v. BATTLE CREEK
STATE BANK, Defendant, Adversary Case No. 16-02082 (E.D. Cal.).
A Notice of and Request for Order for Dismissal of Complaint as to
Defendant Wings Insurance was filed on Feb. 21, 2019 by Plaintiff
International Manufacturing Group, A Liquidating Debtor, by and
through The Beverly Group, Inc., Plan Administrator.
A copy of the Court's Order dated Feb. 25, 2019 is available at
https://bit.ly/2WCEEL7 from Leagle.com.
Beverly N. McFarland, Plaintiff, represented by Christopher Daniel
Sullivan -- csullivan@diamondmccarthy.com -- Diamond McCarthy LLP &
Matthew S. Sepuya , Diamond McCarthy LLP.
Wings Insurance, Inc., Defendant, pro se.
International Manufacturing Group Inc., Debtor, represented by Marc
A. Caraska , Marc A. Caraska, A Law Corporation.
About International Manufacturing
Deepal Wannakuwatte, the mastermind of a $150 million Ponzi scheme,
put himself and his company, International Manufacturing Group
Inc., into Chapter 11 after he pleaded guilty to one count of wire
fraud and agreed to a 20-year prison sentence. The bankruptcy
filing was part of his plea bargain with federal prosecutors. Mr.
Wannakuwatte is the former owner of the Sacramento Capitols tennis
team.
Mr. Wannakuwatte initiated his personal Chapter 11 case on May 30,
2014. Hank Spacone was appointed as trustee for Wannakuwatte's
Chapter 11 estate. Betsy Kathryn Wannakuwatte and Sarah Kathryn
Wannakuwatte also have pending Chapter 7 cases.
Mr. Wannakuwatte also submitted a Chapter 11 bankruptcy petition
for IMG on May 30, 2014 (Bankr. E.D. Cal. Case No. 14-25820) in
Sacramento. The case is assigned to Judge Robert S. Bardwil. The
Debtor tapped Marc A. Caraska, in Sacramento, as counsel.
In June 2014, Beverly N. McFarland was appointed as Chapter 11
trustee for IMG. She tapped Felderstein Fitzgerald Willoughby &
Pascuzzi LLP as her bankruptcy counsel; Diamond McCarthy LLP as her
special litigation counsel; Gabrielson & Company as accountant; and
Karen Rushing as bookkeeper outside the ordinary course of
business.
The U.S. Trustee for Region 7 appointed a three-member unsecured
creditors panel in IMG's case comprising of Byron Younger, Janine
Jones, and Steve Whitesides.
JCV TRUCKING: Unsecureds to Get $1,000 Monthly Over 60 Months
-------------------------------------------------------------
JCV Trucking Corp. filed a Combined Plan of Reorganization and
accompanying Disclosure Statement.
Class 3 - General Unsecured Claims are impaired. Monthly payment of
$1,000 beginning 30 days after Effective Date and ending 60 months
after Effective Date.
Class 1 - Secured claim of Mack Financial Services are impaired
with total claim $85,674.42. Monthly payment of $1,616.78
beginning 15 days after Effective Date and ending after sixty (60)
months.
The Plan Proponent believes that the Debtor will have enough cash
on hand on the
Effective Date of the Plan to pay all the Claims and expenses that
are entitled to be paid on that date.
A full-text copy of the Disclosure Statement dated May 2, 2019, is
available at https://tinyurl.com/y6hl4odk from PacerMonitor.com at
no charge.
JCV Trucking Corp., filed a Chapter 11 Petition (Bankr. D.N.J. Case
No. 18-23621) on July 6, 2018, and represented by Scott C. Pyfer,
Esq., at Pyfer Law Group, LLC.
JLM ENERGY: Unsecured Creditors to Get 0% Under Chapter 11 Plan
----------------------------------------------------------------
JLM Energy, Inc., filed a Chapter 11 Plan and accompanying
disclosure statement.
Class 7 - General Unsecured Claims are impaired. All unsecured
claims allowed under Section 502 of the Bankruptcy Code and the
unsecured portions of secured claims. Any distribution to Class 5
would be after the satisfaction of Administrative Expense Claims
and Priority Taxes. It is not anticipated that any distribution
will be made to General Unsecured Claims. Holders of Class 7
Claims will receive an anticipated distribution of 0% of their
allowed claims.
Monthly payments for priority tax debts will be made from funds
provided by Kraig Clark. Mr. Clark will also advance fees and costs
for the investigation and prosecution of claims against third
parties held by the estate
A full-text copy of the Disclosure Statement dated May 6, 2019, is
available at https://tinyurl.com/yxazpelh from PacerMonitor.com at
no charge.
About JLM Energy
JLM Energy, Inc. -- https://jlmenergyinc.com – is an energy
technology company that created a fully-integrated software
platform and energy ecosystem that optimizes energy use and
maximizes savings for customers. The ecosystem includes the
market's only plug-and-play energy storage product, monitoring
devices, algorithms and load controllers that are all unified via a
single software platform.
JLM Energy sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. E.D. Calif. Case No. 18-25811) on Sept. 13, 2018. In
the petition signed by Kraig Clark, director, the Debtor estimated
assets of less than $500,000 and liabilities of $10 million to $50
million.
Judge Robert S. Bardwil presides over the case.
The Debtor tapped Stephen M. Reynolds, Esq., at Reynolds Law
Corporation, as its legal counsel.
JOHN B. COX: Proposes Private Sale of Personal Property
-------------------------------------------------------
John B. Cox asks the U.S. Bankruptcy Court for the Northern
District of Georgia to authorize the private sale of personal
property as sale opportunities arise.
Mr. Cox owns various personal property, including two vehicles -- a
2004 Jeep Wrangler and a 2003 Mustang Cobra. He routinely buys
and sells personal property, including vehicles, for his personal
and business use. Indeed, like most individuals, it is an
ordinary, rather than an extraordinary, transaction for Mr. Cox to
purchase, outright or via financing, and to sell vehicles, whether
through dealer trade-ins or through private party sales.
Thus, Mr. Cox submits that, short of selling all or substantially
all of his personal property -- something that Mr. Cox is not, by
this Motion, proposing to do -- all of his personal property sales
(including private party vehicle sales), even in bankruptcy, would
be in the ordinary course of his financial and business affairs,
such that the Bankruptcy Code does not require that Mr. Cox obtain
prior court authorization to conduct such sales.
Further, Mr. Cox also owns various de minimis, unused, or even
burdensome or inconsequential items of personal property that he
might desire to sell or dispose of and for which Court
authorization would not be necessary and, in fact, would cost more
to obtain
authorization for on a motion by motion basis than such items are
worth.
Nevertheless, out of an abundance of caution, the Debtor asks
authority to sell his personal property, but not his real property,
as sale opportunities arise, in accordance with the general terms
and conditions and notice procedures proposed.
The Debtor asks authority to sell its Property according to these
general terms and conditions and notice procedures:
a. Type of Sale: Private sale.
b. Type of Property: Personal property, only; all real
property sales will be handled through separate motions, after
notice and a hearing, under Section 363.
c. Purchasers: Arms-length, non-insider parties, only.
d. Price: A fair price as determined by him, based on Mr.
Cox's his extensive experience buying and selling equipment, with
consultations in his discretion with commercial equipment buyers
and financers.
e. Free and Clear Relief: Any sale requiring free and clear
relief under Section 363(f) will be handled via a separate motion
and not be covered by the Motion or any order granting the Motion.
f. Notice Procedures:
i. For each sale with a proposed sale price of more than
$5,000, the Debtor will give the Sale Notice to the Notice
Parties.
ii. The Debtor will serve the Sale Notices on the Notice
Parties, and will specify the Property to be sold, the identity of
the proposed purchaser, the purchase price, and any material terms
and conditions of the proposed sale.
iii. The Notice Parties will have 10 days from the date
that the Sale Notice is sent to provide the Debtor with a written
objection (including an objection via electronic email) to a
proposed transaction. Any such objection will specify the basis
for the objection and will be addressed to David L. Bury, Jr. at
Stone & Baxter, LLP, 577 Mulberry Street, Suite 800, Macon, Georgia
31201, dbury@stoneandbaxter.com.
iv. If no written objection is received by the Debtor by
5:00 p.m. (ET) on the tenth day following the Sale Notice, then the
Debtor will be authorized to consummate the proposed sale
transaction, and any entities having a lien in the property sold
will be deemed to have consented to the sale.
v. If a Notice Party provides a timely written objection
to the proposed transaction, then the Debtor and such objecting
Notice Party will use good faith efforts to consensually resolve
the objection. If the Debtor and the objecting Notice Party are
unable to reach a consensual resolution, then the Debtor will be
required to seek Court approval of the proposed transaction after
notice and a hearing before consummating the proposed transaction.
g. Report of Sale: The Debtor will file a Report of Sale for
each transaction within seven days after it closes, with such
Report of Sale to satisfy F.R.B.P. 6004(f)(1) and to include an
itemized statement of the property sold, the name of each
purchaser, and the price received for each item.
h. Sale Proceeds: All proceeds will be deposited into the
Debtor's DIP bank account and reported on the Debtor's monthly
operating report.
The Debtor has determined that it would be in the best interest of
the Bankruptcy Estate to sell the Property in accordance with the
Sale Conditions.
John B. Cox sought Chapter 11 protection (Bankr. N.D. Ga. Case No.
18-12424) on Nov. 21, 2018. The Debtor tapped David L. Bury, Jr.,
Esq., at Stone & Baxter, LLP, as counsel.
JONES ENERGY: Court Approves Disclosures, Confirms Ch. 11 Plan
--------------------------------------------------------------
The Bankruptcy Court approved, in all respects, the Disclosure
Statement explaining the Chapter 11 Plan of Jones Energy, Inc., and
its debtor affiliates.
The Plan is approved in its entirety and confirmed under Section
1129 of the Bankruptcy Code.
Provisions Regarding Exxon Mobil Corporation. Article V.C of the
Plan provides, in pertinent part, that, "[i]f there is any dispute
regarding any Cure . . . then payment of the applicable Cure amount
shall occur as soon as reasonably practicable after entry of a
Final Order resolving such dispute." For the avoidance of doubt,
this provision applies to the assumption by Jones Energy, LLC of
that certain Farmout and Development Agreement entered into on
August 1, 1998 with Exxon Corporation (now Exxon Mobil Corporation
"Exxon") and as amended on May 1, 2001 and January 24, 2006 and
including any related joint operating agreement (together, the
"Exxon Agreement").
Provisions Regarding the TGS Agreements. Certain of the Debtors, on
one hand, and TGS-NOPEC Geophysical Company ASA and A2D
Technologies Inc. (d/b/a TGS
Geological Products and Services) (collectively, the "TGS
Parties"), on the other hand, are party to several license
agreements for geophysical, well, petroleum and other data and
information, including that certain Master License Agreement for
Geophysical and Geological Data No. HL0317-990 effective March 23,
2017, certain supplementary agreements thereto, a LOG-LINE Plus!(R)
Operating Agreement effective September 8, 2009, and Addendum No. 1
to the LOGLINE Plus!(R) Operating Agreement effective June 13, 2017
(collectively, the "TGS Agreements").
A full-text copy of the Order dated May 6, 2019, is available at
https://tinyurl.com/y5yohyur from PacerMonitor.com at no charge.
About Jones Energy
Austin, Texas-based Jones Energy, Inc. --
http://www.jonesenergy.com/-- is an independent oil and natural
gas company engaged in the exploration, development, production and
acquisition of oil and gas properties in the Anadarko Basin in
Oklahoma and Texas.
Jones Energy and its affiliates sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case No. 19-32112) on
April 14, 2019. At the time of the filing, the Debtors had total
assets of $405,575,000 and liabilities of $1,116,839,000.
The cases are assigned to Judge David R. Jones.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as their bankruptcy counsel; Jackson Walker LLP
as co-counsel with Kirkland and as conflicts counsel; Evercore
Group LLC as financial advisor; Alvarez & Marsal North America,
LLC, as restructuring advisor; Deloitte Tax LLP as tax
restructuring advisor; Baker Botts LLP as special corporate
Counsel; and Epiq Corporate Restructuring, LLC as its claims,
noticing and solicitation agent.
JUST ONE MORE: U.S. Trustee Unable to Appoint Committee
-------------------------------------------------------
The U.S. Trustee, until further notice, will not appoint an
official committee of unsecured creditors in the Chapter 11 case of
Just One More Restaurant Corp., according to court dockets.
About Just One More
Just One More Restaurant Corp. holds the Palm Restaurant
steakhouse's intellectual property -- a series of trademarks and
service marks, design elements of the Palm. JOMR licenses the Palm
IP to the Palm Restaurants through individual licensing agreements.
There are 24 Palm Restaurants currently operating in the United
States and Mexico. The Debtors do not own any of the Palm
Restaurants.
Just One More Restaurant Corp. and Just One More Holding Corp.
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
M.D. Fla. Lead Case No. 19-01947) on March 7, 2019. At the time of
the filing, Just One More Restaurant estimated assets of between
$100 million and $500 million and liabilities of between $10
million to $50 million. Just One More Holding estimated assets and
liabilities of between $1 million and $10 million.
The Debtors tapped Berger Singerman LLP as their legal counsel, and
McHale, P.A. as their restructuring advisor.
LANDS' END: S&P Raises ICR to B on Debt Prepayment; Outlook Stable
------------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S.-based
specialty apparel retailer Lands' End Inc. to 'B' from 'B-' with a
stable outlook. The rating action follows the company's
pre-payment of $100 million of its term loan and improved operating
performance.
Meanwhile, S&P raised its issue-level rating on the company's term
loan to 'B' from 'B-', and revised the recovery rating to '3' from
'4'.
"The upgrade on Lands' End reflects the company's prepayment of
approximately 20% of its term loan and our expectation that
operating performance will further improve, with moderately
enhanced profitability as the company continues to exit remaining
underperforming Sears locations," S&P said.
The stable outlook reflects S&P's expectation for steady credit
metrics over the next 12 months of just below 5x and successful
refinancing of the term loan facility. The outlook also
incorporates the rating agency's expectations for slightly improved
reported EBITDA margins as a result of organic growth and more
disciplined promotional activities.
"We could lower the rating if we expect debt to EBITDA to approach
6x and funds from operations (FFO) to debt to be below 10%. This
could occur if the EBITDA margin declines by more than 150 basis
points below our base case, potentially due to increased
competition, leading to pressured same-store sales and heightened
promotional selling," S&P said.
"We could upgrade the company if it meaningfully broadens its scale
of operating while improving profitability, such that we have a
more favorable view of its competitive standing. This could occur
if e-commerce grows in the high single digits and the company
executes successfully on the retail strategy, leading to solid
same-store sales growth," S&P said, adding that it would also need
to believe the company's financial policy supports credit metrics
and cash flow generation at a higher rating level.
LC STAHL: Wants Court to Approve Proposed Plan Outline
------------------------------------------------------
According to a notice, LC Stahl, LLC will file a motion on June 25,
2019 at 2:00 p.m. to ask the Court for an order approving its
disclosure statement in support of its chapter 11 plan of
reorganization.
The Debtor's Disclosure Statement provides more than enough
information to creditors affected by the plan of reorganization.
The Disclosure Statement covers what the debtor is, what its
business is, how it got into bankruptcy, and how it is going to
operate under the Plan and pay its debts in full. Creditors are
informed into which class they fall, with their respective voting
rights and claim treatment. As such, the Court should approve the
Disclosure Statement and authorize its distribution to creditors,
and set a hearing for the confirmation of the Chapter 11 Plan.
About LC Stahl LLC
Based in Murrieta, California, LC Stahl LLC is a privately-held
company in the residential building construction business. LC
Stahl sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. C.D. Cal. Case No. 18-20003) 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 has
been assigned to Judge Mark D. Houle. The Law Offices of Stuart J.
Wald is the Debtor's counsel.
LINEAGE LOGISTICS: Moody's Hikes CFR to B2, Outlook Stable
----------------------------------------------------------
Moody's Investors Service upgraded ratings for Lineage Logistics,
LLC, including the Corporate Family Rating to B2 from B3, the
Probability of Default Rating to B2-PD from B3-PD and the senior
secured term loan to B2 from B3. The outlook is stable.
RATINGS RATIONALE
The upgrade recognizes the competitive and operational benefits
that will result from the acquisition of Preferred Freezer
Services, acquired for more than $1 billion. The transaction
solidifies Lineage's leading market position making the company
multiple times the size of most of its smaller competitors, and the
meaningfully increased presence is expected to provide clear
economy of scale advantages in a fragmented industry.
The B2 CFR balances Lineage's position as the largest global
provider of cold storage services against the company's aggressive
financial policy and highly leveraged balance sheet. Moody's
acknowledges the stable demand characteristics of refrigerated
warehousing as well as the generally non-discretionary nature of
food products that are housed at Lineage's facilities. This
supports a predictable operating profile and permits a more
leveraged capital structure than otherwise might be expected for
the rating. Lineage's long-standing relationships with its
blue-chip customer base and the geographic diversity of its
warehouse footprint provides further stability and allows
considerable sales and earnings visibility.
Nevertheless, Moody's has concerns about the very rapid pace of
growth (sales will effectively double between 2018 and 2019) and
the ensuing integration and execution risks which it believes will
remain elevated over the near term as Lineage absorbs this
large-sized acquisition. This heightened risk is against a backdrop
of anticipated debt-to-EBITDA of about 8.5x by the end of 2019.
There is little capacity for lapses in execution or operations and
integration. Critical to the ratings is Moody's expectation that
through late 2020, Lineage will refrain from additional acqusitions
and instead focus on integrating the acquired assets and reducing
the company's elevated risk profile.
Furthermore, the transaction occurs at a time when Lineage is
making very meaningful growth-oriented investments that will weigh
on near term cash generation. Moody's anticipates negative free
cash flow of around $100 million during 2019 with free cash
generation turning solidly positive by 2020. Growth-related
investments are expected to be well beyond the bounds of internally
generated cash flow during 2019 and will result in an adequate
liquidity profile with a reliance on external sources of financing.
Additional near-term M&A activity or further growth-oriented capex
beyond what is already contemplated could create downward rating
pressure.
Moody's expects Lineage to maintain an adequate liquidity profile
over the next 12 months. On-going cash balances are anticipated to
be modest (likely to be around $10 million) as the company
continues to make large-sized expansionary and greenfield
investments. As such, Moody's expects negative free cash flow in
2019 which is likely to be in excess of $100 million. External
liquidity is provided by a $300 million ABL revolving credit
facility that expires in November 2023. The facility contains a
springing Fixed Charge Coverage ratio of 1.0x that comes into
effect if excess availability is less than the greater of $12.75
million or 10% of the maximum available credit. Moody's does not
expect the covenant to come into effect and anticipate comfortable
cushions to the extent that it did.
The stable outlook reflects the steady and recurring nature of
demand within the cold storage industry along with its expectations
of muted M&A activity over the next 12 to 18 months and continued
topline and earnings growth.
The ratings could be upgraded if Lineage were to strengthen its
balance sheet such that Moody's adjusted Debt-to-EBITDA was
expected to remain below 5.5x. An improved liquidity profile
involving consistently positive free cash generation and
expectations of a prudent financial policy would be prerequisites
to any upgrade. The ratings could be downgraded if Moody's adjusted
Debt-to-EBITDA was expected to be sustained in the high 8x range.
Reversals of recent operational improvements, the loss of a major
customer, or a sustained weakening of profitability such that
EBITDA margins were expected to remain in the low-20% range could
also result in a downgrade. A deterioration in the company's
liquidity would also place downward pressure on the rating.
The following is a summary of the rating actions:
Issuer: Lineage Logistics, LLC
Corporate Family Rating, upgraded to B2
from B3
Probability of Default Rating, upgraded to B2-PD
from B3-PD
Senior Secured Term Loan B, upgraded to B2 (LGD3)
from B3 (LGD4)
Outlook, Stable
Lineage Logistics, LLC, headquartered in Novi, MI., is the largest
provider of refrigerated storage services in the world. Lineage is
owned and managed by Bay Grove, a principal investment firm. For
the twelve months ended December 2018 and pro forma for the
Preferred Freezer acquisition, Lineage is expected to generate
revenues of about $2 billion.
LNB-015-13 LLC: June 20 Approval Hearing on Disclosure Statement
----------------------------------------------------------------
Bankruptcy Judge Robert A. Mark is set to hold a hearing on June
20, 2019 at 2:00 p.m. to consider approval of LNB-015-13, LLC's
disclosure statement.
Deadline for objections to the disclosure statement is June 13,
2019.
The Troubled Company Reporter previously reported that the allowed
unsecured claim of JJLB Property Management LLC $10,883 will be
paid 100% in four equal monthly installments after confirmation and
payment of bank claim.
A full-text copy of the Amended Disclosure Statement dated April
24, 2019, is available at https://tinyurl.com/y6ljcmwy from
PacerMonitor.com at no charge.
About LNB-015-13 LLC
LNB-015-13, LLC, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Fla. Case No. 17-19226) on July 22,
2017. The petition was signed by Harel Bitton, its authorized
representative. At the time of the filing, the Debtor estimated
assets and liabilities of less than $500,000. Joel M. Aresty P.A.
is the Debtor's bankruptcy counsel. An official committee of
unsecured creditors has not yet been appointed in the Chapter 11
case.
LUXURY LIMOUSINE: Philadelphia Objects to Disclosure Statement
--------------------------------------------------------------
City of Philadelphia objects to the Amended Chapter 11 Small
Business Disclosure Statement and Amended Chapter 11 Small Business
Plan filed by Luxury Limousine Service, Inc.
The City points out that the Disclosure Statement is inadequate
because the cash flow projections contained in Exhibit D to the
Plan are still deficient. The City cannot follow the numbers in the
Debtor's cashflow projections.
The City further points out that the cashflow projections do not
provide any detail as to what income streams the Debtor expects to
have and the sources of income.
The City asserts that the Plan states "each holder of an [a]llowed
Priority Tax Claim shall be paid the full amount of such Allowed
Priority Tax Claim in deferred cash payments over a period not to
exceed five (5) years commencing from the date which is the first
anniversary from the date of filing . . . ." but later on in the
third paragraph to Section 4.1 of the Plan, "[t]he payments on
priority tax claims shall not extend beyond sixty (60) months from
May 1, 2018."
The City complains that the Debtor's Plan may violate the absolute
priority rule. According to the City, pursuant to 1129(b)(2)(B)(ii)
for a bankruptcy plan to be fair and equitable to a dissenting
class of unsecured creditors, the Plan must provide that "the
holder of any claim or interest that is junior to the claims of
such class will not receive or retain under the plan on account of
such junior claim or interest any property."
About Luxury Limousine Service
Luxury Limousine Service, Inc., sought protection under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Pa. Case No. 18-13574) on May
31, 2018. In the petition signed by Perry Camerlengo, president,
the Debtor estimated assets of less than $1 million and liabilities
of less than $1 million. The Debtor tapped Bottiglieri Law, LLC as
its legal counsel.
MACQ–TENNESSEE I: S&P Rates 2019 Student Housing Bonds 'BB+'
--------------------------------------------------------------
S&P Global Ratings has assigned its 'BB+' long-term rating to the
Arizona Industrial Development Authority's (AZIDA) series 2019
student housing revenue bonds (University of Memphis-Southern
Avenue), issued for MACQ–Tennessee I LLC (MACQ-TN), D.C. The
outlook is stable.
MACQ–Tennessee I LLC was established as a limited liability
company under Delaware law, of which MACQ Holding LLC is the sole
member. MACQ-TN was established to acquire, pursuant to a financing
agreement between AZIDA and the MACQ-TN, a student housing facility
comprised of two existing fully furnished four-story buildings,
consisting of 136 units with approximately 435 beds and 137 parking
spaces, called 'Gather at the Southern' (the project).
"The rating reflects S&P's assessment of good connectivity between
the University of Memphis and the project with the project being on
university owned land, marketed on-par with all other university
on-campus housing along with having all amenities of university
housing," said S&P Global Ratings credit analyst Gauri Gupta.
"These positive factors are offset with the use of a third-party
manager that could limit oversight as daily operations are being
outsourced."
At the same time, while the project has a priority fill commitment
from the university of 100% beds, the university has pre-existing
commitment of priority fill for 70% (or 1,592) on-campus beds,
which could lead to fill-up risk in the future. The project has
experienced high occupancy while it was off-campus, the series 2019
transaction brings this project on-campus as a part of the
long-term strategic vision of the university. UofMemphis has been a
historically commuter campus with low freshmen capture rate and the
project is open to all students ranging from freshmen to graduate
students with families. The uncertainty of the intended occupants
coupled with UofMemphis' s history as a commuter school also adds
to the occupancy risk and S&P's overall assessment of the rating.
Although it reviewed University of Memphis's (UofMemphis) finances
and market position to understand the resulting demand for the
project, S&P does not rate UofMemphis. S&P said the rating on the
project bonds should not be construed as a rating on the university
itself.
Total par amount for the series 2019 bonds is approximately $35
million. Bond proceeds will be used to finance the cost of
acquisition of the project, fund required reserves, including a
debt service reserve fund, and paying the cost of issuance. MACQ-TN
will acquire the project and deed it to the university. Pursuant to
a master lease agreement, the university will lease the project to
MACQ-TN for operations. In addition, RISE Residential LLC will be
the manager of the project under a management agreement. A
leasehold mortgage and all revenues of the student housing project,
secure the series 2019 bonds. Project ownership will revert to the
university after the bonds are fully repaid.
"The stable outlook reflects our expectation that, during the
one-year outlook period, the project will generate at least
breakeven occupancy level. We would also expect that third-party
manager to manage and control the project expenses such that
project has sufficient net revenues available to pay annual debt
service," S&P said.
MAJOR EVENTS: Latest Plan Amends Treatment of IRS Claim
-------------------------------------------------------
Major Events Group LLC filed with the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania an amended chapter 11 plan of
reorganization.
The latest plan amends the treatment of the Internal Revenue
Service 4-1, Claim 1 in Class I. This claim will be paid in full in
the first disbursements after the Plan is accepted; the funds will
be from operating funds. This Class is unimpaired.
The previous version of the plan provided that this claim will be
paid with the first administrative disbursement.
A copy of the Amended Plan is available at
https://tinyurl.com/y3tnz2dh from Pacermonitor.com at no charge.
About Major Events Group
Major Events Group LLC sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Pa. Case No. 18-11123) on Feb. 20,
2018. In the petition signed by Antoine Gardiner, president, the
Debtor disclosed that it had estimated assets of less than $50,000
and liabilities of less than $50,000. Judge Eric L. Frank presides
over the case. The Debtor tapped Michael P. Kutzer, Esq., as its
legal counsel.
MIDWEST-ST. LOUIS: U.S. Trustee Unable to Appoint Committee
-----------------------------------------------------------
No official committee of unsecured creditors has been appointed in
the Chapter 11 case of Midwest-St. Louis, LLC as of May 13,
according to a court docket.
About Midwest-St. Louis LLC
Midwest-St. Louis, LLC owns and operates a gas station and
convenience store in Saint Louis.
Midwest-St. Louis sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Mo. Case No. 19-42279) on April 12,
2019. At the time of the filing, the Debtor had estimated assets
of less than $50,000 and liabilities of between $1 million and $10
million.
The case has been assigned to Judge Kathy A. Surratt-States. The
Debtor tapped Carmody MacDonald P.C. as its legal counsel.
MONTEREY RESOURCES: Case Summary & 44 Largest Unsecured Creditors
-----------------------------------------------------------------
Two affiliates that have filed voluntary petitions seeking relief
under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Monterey Resources LLC (Lead Case) 19-50596
600 Camino Aquajito, Ste. 300
Monterey, CA 93940
Green Wheel, LLC 19-50597
660 Camino Aquajito, Ste. 300
Monterey, CA 93940
Business Description: Monterey Resources and Green Wheel are
private oil and gas exploration & production
companies.
Chapter 11 Petition Date: May 14, 2019
Court: United States Bankruptcy Court
Western District of Louisiana (Lafayette)
Judge: Hon. John W. Kolwe
Debtors' Counsel: Mark A. Mintz, Esq.
JONES WALKER LLP
201 St. Charles Ave., 49th Floor
New Orleans, LA 70170
Tel: (504) 582-8368
(504) 582-8000
Fax: (504) 589-8368
(504) 589-8260
Email: mmintz@joneswalker.com
Monterey Resources'
Estimated Assets: $10 million to $50 million
Monterey Resources'
Estimated Liabilities: $10 million to $50 million
Green Wheel's
Estimated Assets: $10 million to $50 million
Green Wheel's
Estimated Liabilities: $10 million to $50 million
The petitions were signed by Robert Imel, manager.
Full-text copies of the petitions are available for free at:
http://bankrupt.com/misc/lawb19-50596.pdf
http://bankrupt.com/misc/lawb19-50597.pdf
A. List of Debtors' 44 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. AEP
P.O. Box 371496
Pittsburgh, PA 15250-7493
2. B&S Electrical of Arklatex LLC
P.O. Box 56
Homer, LA 71040
3. Bayou Swabbing LLC
9860 Hwy. 80
Minden, LA 71055
4. Blackbeard Operating East LLC
200 N. Loraine St., Ste 300
Midland, TX 79701
5. Bluetick Inc.
1501 Highwoods Blvd.
Greensboro, NC 27410
6. Boots Smith Completion Services LLC
P.O. Box 1987
Laurel, MS 39441
7. City of Shreveport Dept. of Water and Sewage
P.O. Box 30065
Shreveport, LA 71153-0065
8. Claiborne Electric Coop
P.O. Box 719
Homer, LA 71040-0719
9. Claiborne Parish Sheriff's Office
613 E. Main
Homer, LA 71040
10. Comstock Oil & Gas LP
5300 Town and Country Blvd.
Frisco, TX 75034
11. Degolyer Macnaughton
5001 Spring Valley Rd, #800E
Dallas, TX 75244
12. Dependable Pump & Supply Inc.
P.O. Box 189
Haynesville, LA 71038
13. Don-Nan Pump & Supply
2525 N. Longview St.
Kilgore, TX 75662
14. Dykes Well Services
5329 Shreveport Blanchard Hwy.
Shreveport, LA 71107
15. First Insurance Funding
P.O. Box 7000
Carol Steam, IL 60197-7000
16. Furlow Trucking Services LLC
127 Acklin Ave.
Haynesville, LA 71038
17. Gardner Consultants Inc.
5927 Fairfield Ave.
Shreveport, LA 71106
18. Gulf Coast Chemical LLC
220 Jacqulyn St.
Abbeville, LA 70510
19. He-Ro Compression and Well Services LLC
249 Burkheimer Rd.
Saline, LA 71070
20. J-W Power Company
P.O. Box 205856
Dallas, TX 75230-5856
21. Lakeview Waterworks District
3205 Lorraine Ave.
Shreveport, LA 71107
22. Landworks Inc.
2600 S. Gessner Rd., #420
Houston, TX 77063
23. Locke Lord LLP
220 Ross Ave., Ste 2800
Dallas, TX 75201
24. Middle Fork Water System, Inc.
P.O. Box 169
Lisbon, LA 71048
25. O'NealGas, Inc.
P.O. Box 721
Choudrant, LA 71227-0721
26. Parish of Caddo
501 Texas, St., #103
Shreveport, LA 71101
27. Parish of Webster
410 Main St.
Minden, LA 71055
28. Petro-Chem Operating Company
416 Travis St., Ste 812
Shreveport, LA 71101
29. Philip N. Asprodites
4 Tano W.
Santa Fe, NM 87506
30. R.W. Shelton Services, Inc.
P.O. Box 306
McLeod, TX 75565
31. Rabalais Oil and Gas Inc.
817 Florence St.
Fort Worth, TX 76102
32. S&E Fabrications LLC
7065 Hwy. 545
Arcadia, LA 71001
33. Sky Vacuum Services LLC
4213 Sligo Rd.
Haughton, LA 71037
34. Sterling Commercial Credit - Arcadia Supply
P.O. Box 89
Arcadia, LA 71001
35. STI Trucking LLC
Dept #1605
P.O. Box 14407
Birmingham, AL 35246-1605
36. Summerfield Water System
P.O. Box 159
Summerfield, LA 71079
37. TDX Energy LLC
401 Edwards St., Ste 1900
Shreveport, LA 71101
38. The Resource Group
5100 E. Skelly Dr., Ste. 405
Tulsa, OK 74135
39. TRC Rod Services of Oklahoma Inc.
7001 S. Eastern Ave.
Oklahoa City, OK 73149
40. Triple J Well Svc. Inc.
P.O. Box 443
Deberry, TX 75639
41. UP4 Energy Services LLC
P.O. Box 43
Farmerville, LA 71241
42. Walkmar Resources Inc.
P.O. Box 29
Minden, LA 71058
43. XTO Energy Inc.
110 W. 7th St.
Fort Worth, TX 76102
44. Yellow Jacket Oilfield Services
130 Corporate Dr.
Sibley, LA 71073
The Debtors indicated that at this time they do not know how much
the unsecured creditors are owed and will amend and supplement the
list once this information is obtained.
MONTGOMERY SERVICES: Lender Objects to Disclosure Statement
-----------------------------------------------------------
JPMorgan Chase Bank, N.A., files its reservation of rights and
initial objections to the Joint Disclosure Statement and Joint Plan
filed by Montgomery Services, Inc., d/b/a Mammoth Restoration of
the Palm Beaches.
The Lender points out that the Plan contemplates a de facto
substantive consolidation of the Debtors' cases when no substantive
consolidation has been authorized or sought.
The Lender further points out that the Plan intends to pay other
creditors from the cash collateral of the Lender without consent
and without repayment of the Lender's claim in full.
The Lender further objects on the grounds that the Plan fails to
pass the so-called best interest test of Section 1129(a)(7) of the
Bankruptcy Code in that, if its collateral were liquidated now, the
Lender would receive more than it reasonably or feasibly will under
the Plan.
The Lender further objects to confirmation of the Plan on the
grounds that there is no accepting impaired class of claims,
without including any acceptance by insiders, as required by
Section 1129(a)(10) of the Bankruptcy Code.
The Lender further objects to confirmation of the Plan pursuant to
Section 1129(a)(11) of the Bankruptcy Code as the Plan is likely to
be followed by liquidation, or the need for further financial
reorganization of the Debtors -- i.e., the Plan is not feasible.
Attorneys for JPMorgan Chase Bank, N.A.:
Ryan C. Reinert, Esq.
SHUTTS & BOWEN LLP
4301 W. Boy Scout Blvd., Suite 300
Tampa, FL 33607
Telephone: (813) 229-8900
Facsimile: (813) 229-8901
E-mail: rreinert@shutts.com
-- and --
Edward J. O'Sheehan, Esq.
PNC Center, Suite 2100
200 East Broward Boulevard
Fort Lauderdale, Florida 33301
Telephone: (954) 524-5505
Facsimile: (954) 524-5506
E-mail: eosheehan@shutts.com
About Montgomery Services
Montgomery Services, Inc., d/b/a Mammoth Restoration of the Palm
Beaches, is a leader in Pennsylvania repair and restoration.
Montgomery Services filed a voluntary petition for relief under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Fla. Case No.
18-15699) on May 11, 2018. In the petition signed by its
president, Nathan M Smith, the Debtor disclosed under $500,000 both
in assets and liabilities. Aaron A. Wernick, Esq., at Furr &
Cohen, is the Debtor's counsel.
N & B MANAGEMENT: Unsecureds to be Paid in Full with No Interest
----------------------------------------------------------------
N & B Management Co., LLC filed a small business disclosure
statement explaining its chapter 11 plan dated April 29, 2019.
N & B Management owns commercial and residential rental properties
and operates a business managing and renting the units.
The Class 11 General Unsecured Creditors allowed claims will be
paid up to 100% of their claims from the remaining net proceeds
after the liquidation of certain real property as determined by the
Debtor. These claims will be paid in full with no interest within
12 months from the Plan Effective Date.
The Debtor will continue to rent the real estate it retains. The
Debtor will also sell real estate if necessary to complete the plan
of reorganization. The Debtor will use all combined income to fund
its plan of reorganization.
A copy of the Disclosure Statement dated April 29, 2019 is
available at https://tinyurl.com/y3wgo2o4 from Pacermonitor.com at
no charge.
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 represented by
Jeffrey J. Sikirica, Esq., in Gibsonia, Pennsylvania.
NATIVE SON: Court Confirms Chapter 11 Plan
------------------------------------------
The Bankruptcy Court has approved, on a final basis, the Disclosure
Statement of Native Son Landscaping, LLC, and confirmed the Plan in
all respects.
There shall be a post confirmation Status Conference hearing on May
23, 2019, at 1:30p.m. The Status Conference hearing will be held in
Courtroom 8B, Sam M. Gibbons U.S. Courthouse, 801 N. Florida
Avenue, Tampa, FL 33602 before the Honorable Catherine Peek McEwen,
United States Bankruptcy Judge.
The Ally Financial Objections are overruled on the terms and
conditions set for herein:
a. The Creditor's Ally Financial Objection (Doc. No. 120). The
Debtor and Ally Financial shall confer to determine the amount of
the arrearage existing concerning the vehicle in Class III (2015
Chevrolet Silverado), as of the date of the entry of the
Confirmation Order. In the event the vehicle is surrendered, the
Creditor may file an unsecured claim for the deficiency, within
forty-five (45) days of the sale of the vehicle, to be treated
under Class IX.
b. The Creditor's Ally Financial Objection (Doc. No. 121). As to
Class IV (2015 Isuzu NPR-HD), in the event that the Debtor does not
pay the amount necessary to have the vehicle returned, the creditor
has its rights to proceed to sell the vehicle and file an unsecured
claim for the deficiency, within forty-five (45) days of the sale
of the vehicle, to be treated under Class IX.
The BB&T Objection and the United States Trustee's Objection is
overruled.
About Native Son Landscaping
Native Son Landscaping, LLC, sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. M.D. Fla. Case No. 18-07968) on Sept.
20, 2018. At the time of the filing, the Debtor estimated assets
of less than $500,000 and liabilities of less than $500,000. The
Debtor tapped Melody Genson, Esq., as its bankruptcy attorney.
NCW PROPERTIES: Unsecured Creditors to Get 3% to 6% Under Plan
--------------------------------------------------------------
NCW Properties, LLC, filed a Chapter 11 Plan and accompanying
disclosure statement.
Class 2 - General Unsecured Claim are impaired. Approximately
$4,700,000.00, not including waived claims (before Claims objection
process). Estimated $700,000.00 to $1.5 million (after Claims
objection process). Pro rata share of the then available Class 2
Distribution Amount. Between 3% to 6% estimated PLUS net proceeds
of litigation recoveries, if any.
Class 1 - Store Secured Claim are impaired. Per Store Agreement. No
distribution per Store Agreement.
Class 3 - Interests are impaired. All Interests cancelled
The Plan will be funded with (i) the funds in the Estate as of the
Effective Date, if any, (ii) $208,000 from the Buyer as set forth
in the Buyer Letter Agreement; (iii) payment of payroll tax
liabilities by the Buyer of $285,000 as set forth in the Buyer
Letter Agreement, (iv) the balance of the Sale Carve-Out of
approximately $195,000 to pay Chapter 11 Professional Fees and
Expenses (with any balance to be paid from the Plan Funding, as set
forth in Article II, to the extent the Sale Carve Out is
insufficient to pay such Professional Fees and Expenses); and (v)
the proceeds of potential Causes of Action.
A full-text copy of the First Amended Disclosure Statement dated
May 2, 2019, is available at https://tinyurl.com/y5sg25sl from
PacerMonitor.com at no charge.
About NCW Properties
NCW Properties, LLC -- http://www.nascarcarwash.com/-- owns a car
washing business. Headquartered in Joliet, Illinois, NCW Properties
is an official NASCAR licensee and holds the exclusive license to
build, brand and operate NASCAR Car Washes across the U.S. and
Canada.
NCW Properties, LLC sought Chapter 11 protection (Bankr. N.D. Ill.
Case No. 18-34019) on July 19, 2018. Judge Timothy A. Barnes is
assigned to the case. In the petition signed by Dean T. Tomich,
manager, the Debtor estimated between $100,000 to $500,000 in
assets and $1 million to $10 million in liabilities. The Debtor
tapped Phillip J. Block, Esq, and Alan L. Braunstein, Esq. at
Riemer & Braunstein LLP, as counsel. ASI Advisors, LLC serves as
its financial advisors.
NORTHEASTERN ILLINOIS UNIVERSITY: Moody's Affirms B3 on $31MM COPs
------------------------------------------------------------------
Moody's Investors Service has revised Northeastern Illinois
University's outlook to stable from negative. Moody's has affirmed
the B3 rating on $31 million of outstanding Certificates of
Participation.
RATINGS RATIONALE
The outlook revision to stable from negative reflects NEIU's
strengthened liquidity and improved operating performance following
the receipt of full state funding for fiscal 2017 and fiscal 2018.
Operating performance will moderate in fiscal 2019 and fiscal 2020,
but is expected to outperform recent pre-fiscal 2018 performance.
Also incorporated in the outlook revision are its current
expectations for modest increases in state funding from the State
of Illinois (Baa3 stable) over the outlook period. Combined, direct
operating appropriations and "on behalf" benefit payments represent
over half of the university's operating revenue.
The B3 rating on NEIU's outstanding COPs incorporates the unsecured
nature of the pledge and ability to terminate in certain
circumstances. While certain aspects of the university's credit are
rebounding-notably liquidity and operating performance-the rating
remains constrained by material enrollment challenges and longer
term uncertainty around state funding. The university does carry
some market distinction as a designated Hispanic Serving
institution, with a moderate scale that provides some flexibility
to adjust. Management is anticipating a flat incoming class for
fall 2019, but overall enrollment is expected to fall as a larger
class graduates. Enrollment challenges beyond 2019 will persist due
to a fiercely competitive market for students, particularly in the
City of Chicago (Ba1 stable), where NEIU draws students from
heavily.
RATING OUTLOOK
The stable outlook reflects expectations of generally stable state
operating appropriations for fiscal 2020 with timing of payments
consistent with fiscal 2019, leading to a more steady and
predictable operating environment over the next two years despite
ongoing enrollment challenges.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Multi-year material improvement in the state's fiscal condition
resulting in greater predictability in the amount and timing of
state funding
- Growing enrollment leading to increased net tuition revenue and
decreasing reliance on state funding for operations
- Substantial growth in balance sheet reserves to mitigate
exposure to volatile or declining state funding
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Sustained decline in directly paid state operating support or
benefits provided through "on behalf" payments
- Material weakening of liquidity or inability to maintain sound
operating performance
- Inability to curb enrollment losses leading to sustained net
tuition revenue declines
LEGAL SECURITY
The Certificates of Participation are payable from both
state-appropriated funds and from budgeted legally available funds
of the university from sources other than state appropriations,
including tuition and fees. While the COPs are payable from NEIU's
broad budget and the obligation to pay can be terminated in the
event that it does not receive sufficient state appropriations and
the board determines the university does not have other legally
available funds.
PROFILE
NEIU is a regional comprehensive public university with multiple
campuses in the Chicago metropolitan area. It is designated by the
US Department of Education as a Hispanic-Serving Institution. Fall
2018 FTE student enrollment was 5,202 students and fiscal 2018
operating revenue was $228 million, as calculated by Moody's.
NORTHERN ILLINOIS UNIVERSITY: Moody's Affirms Ba3 on $9MM COPs
--------------------------------------------------------------
Moody's Investors Service has revised Northern Illinois
University's outlook to stable from negative. Moody's has affirmed
the Ba2 rating on approximately $180 million of outstanding
Auxiliary Facilities System bonds and the Ba3 rating on
approximately $9 million of outstanding Certificates of
Participation.
RATINGS RATIONALE
The outlook revision to stable from negative reflects NIU's
strengthened liquidity and operating performance following the
receipt of state funding for fiscal 2017 and fiscal 2018. Operating
performance will moderate in fiscal 2019 and fiscal 2020 but should
outperform recent pre-fiscal 2018 performance. Also incorporated in
the outlook revision are its current expectations for modest
increases in state funding from the State of Illinois (Baa3 stable)
over the outlook period. Combined, direct operating appropriations
and "on behalf" benefit payments represent over half of the
university's operating revenue.
Constraining the rating is continued pressured enrollment, with
annual declines since 2005 and a cumulative drop of over 30%, along
with longer term uncertainty around state funding due to the
state's own fiscal challenges. Favorably, expenses continue to be
adjusted and the university does have a sizeable operating base,
providing some operating flexibility.
The Ba2 rating on NIU's AFS bonds incorporates the secured interest
in revenues while the Ba3 rating on the COPs reflect the unsecured
nature of the pledge with the ability to terminate the purchase
contract in certain circumstances.
RATING OUTLOOK
The stable outlook reflects expectations of generally stable state
operating appropriations for fiscal 2020 with timing of payments
consistent with fiscal 2019. The stable outlook also reflects
expected stabilizing full-time equivalent (FTE) student enrollment.
The stable outlook also reflects relatively stable undergraduate
matriculation in fall 2019 and continued expense adjustments to
maintain adequate operating performance.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Multi-year material improvement in the state's fiscal condition
resulting in greater predictability in the amount and timing of
state funding
- Stable to growing enrollment leading to increased net tuition
revenue and decreasing reliance on state funding for operations
- Substantial growth in balance sheet reserves to mitigate
exposure to volatile or declining state funding
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Sustained decline in directly paid state operating support or
benefits provided through "on behalf" payments
- Material weakening of liquidity or inability to maintain sound
operating performance
- Inability to curb enrollment losses leading to sustained net
tuition revenue declines
LEGAL SECURITY
The Auxiliary Facilities System Revenue Bonds are secured by a
pledge of and lien on Net Revenues of the Auxiliary System and
pledged fees. The Series 2010 and 2011 Bonds and subsequent parity
bonds are further payable from and secured by a pledge and lien on
pledged tuition (subject to prior payment of operating and
maintenance expenses of the system to the extent necessary). Net
revenues plus pledged fees and tuition must be equal to at least
1.15x maximum annual debt service. In fiscal 2018 net pledged
revenues, including net tuition revenue, totaled $144 million,
providing a strong 8.4x MADS coverage. NIU's auxiliary system is
"closed" and the university has built a reserve of $79 million that
can be drawn upon to make-up any shortfalls.
The Series 2014 Certificates of Participation are payable from
state appropriated funds and budgeted legally available funds of
the board. Legally available funds include student tuition (subject
to the prior pledge AFS revenue bonds), certain fees, certain
investment income, and indirect cost recoveries on grants and
contracts. The board is required to transfer pledged tuition to pay
for the operating and maintenance costs of the AFS if AFS revenues
are insufficient, and these expenses have a priority position over
debt service for the COPs. The COPs are unsecured, and the
installment agreement can be terminated in the absence of budgeted
legally available funds, resulting in a weaker security than the
secured pledge provided to AFS bonds.
PROFILE
Northern Illinois University is a multi-campus public university
with its main campus in DeKalb, Illinois and three outreach centers
which primarily serve graduate students. The university has a broad
array of undergraduate and graduate academic programs, including
concentrations in education, business, engineering, health and
human science, law and visual and performing arts. Fall 2018 total
FTE student enrollment was 14,352.
NS FITNESS: U.S. Trustee Unable to Appoint Committee
----------------------------------------------------
The U.S. Trustee, until further notice, will not appoint an
official committee of unsecured creditors in the Chapter 11 case of
NS Fitness LLC, according to court dockets.
About NS Fitness LLC
NS Fitness LLC -- http://www.nextstepfitnessocala.com/-- owns and
operates a gym in Ocala, Calif.
NS Fitness sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. M.D. Fla. Case No. 19-01173) on March 29, 2019. At
the time of the filing, the Debtor estimated assets of less than
$50,000 and liabilities of between $1 million and $10 million.
Schatt, Hesser, McGraw is the Debtor's bankruptcy counsel.
OHCP NORTHEASTERN: S&P Affirms 'B-' Rating on First-Lien Term Loan
------------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' issue-level rating on Albany,
N.Y.-based fiber infrastructure provider OHCP Northeastern Fiber
Buyer Inc.'s (FirstLight Fiber) first-lien term loan due 2025 and
revised the recovery rating to '4' from '3' following the company's
proposed $80 million add-on to the facility (for a total of $455
million outstanding). The '4' recovery rating indicates S&P's
expectation for average (30%-50%; rounded estimate: 45%) recovery
of principal and interest for first-lien lenders in the event of a
payment default.
At the same time, S&P affirmed its 'CCC' issue-level rating on the
company's second-lien debt following FirstLight Fiber's proposed
$10 million add-on to its second-lien term loan due 2026 ($100
million total). The '6' recovery rating remains unchanged,
indicating S&P's expectation for negligible (0%-10%; rounded
estimate: 0%) recovery of principal and interest for second-lien
lenders in the event of a payment default.
The company will use the proceeds from the add-ons, along with $20
million of equity, to fund future acquisitions in the fiber space,
repay its revolver borrowings, pre-fund its capital expenditure,
and return cash to its balance sheet. In the first quarter of 2019,
FirstLight Fiber's private-equity sponsor, Antin Infrastructure,
contributed $50 million of equity to help fund the company's two
new capital project wins.
S&P expects FirstLight Fiber's adjusted debt to EBITDA to decline
to the 7x area in 2020 from about 8.5x pro forma for the
acquisition on earnings growth supported by its recent contract
wins and the favorable demand characteristics in the fiber
transport industry. Still, any longer-term improvement in the
company's leverage is constrained by its private-equity sponsors
and the potential for elevated capital expenditure or debt-financed
acquisitions and dividends.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario contemplates speculative
capital spending with economic pressure that leads to customer
churn. This would cause the company's cash flow to decline to the
point that it is unable to cover its fixed charges (interest
expense, required amortization, and maintenance capital
expenditure), eventually leading to a default in 2021.
-- S&P valued FirstLight on a going-concern basis using a 5.5x
multiple of the rating agency's projected emergence EBITDA.
Generally, S&P assigns a multiple of 5x-6x for fiber infrastructure
companies. The rating agency chose a 5.5x multiple for the company
given its ratio of owned to leased fiber network assets relative to
that of its other fiber infrastructure peers.
Simulated default assumptions
-- Simulated year of default: 2021
-- EBITDA at emergence: $47 million
-- EBITDA multiple: 5.5x
Simplified waterfall
-- Net enterprise value (after 5% administrative costs): $248
million
-- Valuation split (obligors/nonobligors): 100%/0%
-- Collateral value available to first-lien secured creditors:
$248 million
-- Secured first-lien debt: $503 million
-- Recovery expectations: 30%-50% (rounded estimate: 45%)
-- Collateral value available to second-lien secured creditors:
$0
-- Secured second-lien debt: $105 million
-- Recovery expectations: 0%-10% (rounded estimate: 0%)
Note: All debt amounts include six months of prepetition interest.
Ratings List
OHCP Northeastern Fiber Buyer, Inc.
Issuer Credit Rating B-/Stable/--
Ratings Affirmed; Recovery Rating Revised
To From
--- ----
Flight Bidco Inc.
OHCP Northeastern Fiber Buyer, Inc.
Senior Secured First Lien B-
Recovery Rating 4(45%) 3(50%)
Ratings Affirmed
Flight Bidco Inc.
OHCP Northeastern Fiber Buyer, Inc.
Senior Secured Second Lien CCC
Recovery Rating 6(0%)
OWENS & MINOR: Fitch Cuts LT IDR to CCC+ & Sec. Debt Rating to B-
-----------------------------------------------------------------
Fitch Ratings downgraded Owens & Minor, Inc.'s Long-Term Issuer
Default Rating to 'CCC+' from 'B-'/Outlook Negative and its senior
secured debt ratings to 'B-' from 'B'. The recovery ratings on the
debt issues remain 'RR3'.
The rating downgrade reflects the rising level of uncertainty
surrounding customer retention levels and revenue stability, the
cash conversion cycle and the increasing dependence on the
company's revolving credit facility for liquidity. These risks
combined with the significant amount of debt service requirements
are constraining the company's financial flexibility.
Fitch is encouraged by OMI's sense of urgency in dealing with the
aforementioned challenges since its Board announced a change in CEO
in November 2018. Fitch believes that the company's service and
customer retention levels will be the keys to OMI's turnaround; it
is unclear whether the company will be able to make sufficient
progress in those levels before it exhausts its sources of
liquidity.
The rating action applies to approximately $1.7 billion of debt as
of March 31, 2019.
KEY RATING DRIVERS
Margin Compression; Weak Operating Performance in Legacy Business:
OMI is expected to experience weaker margins over the medium term
because of a continuation of negative pricing trends and the
potential for continued customer churn. The company's operating
performance in its domestic distribution business may continue to
weaken in 2019 as contract losses in 2018 begin to take effect.
Higher operating costs, customer losses and warehouse
inefficiencies are expected to remain significant obstacles, while
the contributions from recent acquisitions are significantly offset
by higher interest expense.
Competitive Environment: The med-surg supply distribution industry
in the U.S. and Europe is highly competitive and characterized by
pricing pressure, which accelerated in 2017 and continues to
persist. Fitch expects margin pressure to continue over the coming
years. OMI competes with other national distributors (e.g. Cardinal
Health, and Medline, Inc.) and a number of regional and local
distributors, as well as customer self-distribution models and, to
a lesser extent, certain third-party logistics companies. OMI's
success depends on its ability to compete on price, product
availability, delivery times and ease of doing business, while
managing internal costs and expenses.
Customer Concentration: OMI's 2018 10-K stated that its top- 10
customers in the U.S. represented approximately 23% of its
consolidated net revenue. Additionally, in 2018, approximately 72%
of its consolidated net revenue was from sales to member hospitals
under contract with its largest Group Purchasing Organizations
(GPOs): Vizient, Premier and HPG. As a result of this
concentration, OMI could lose a significant amount of revenue due
to the termination of a key customer or GPO relationship. For
example, in April 2016, OMI announced the loss of its largest IDN
customer, which had accounted for approximately $525 million of
2015 revenue. The termination of a relationship with a given GPO
would not necessarily result in the loss of all of the member
hospitals as customers, but the termination of a GPO relationship,
or a significant individual healthcare provider customer
relationship could adversely affect OMI's debt-servicing
capabilities. On the Q1 2019 earnings call, OMI confirmed that the
Vizient contract has been renewed through August 2020.
Supplier Concentration: In 2018, OMI reported that sales of
products of its 10 largest domestic suppliers accounted for
approximately 47% of consolidated net revenue. In the domestic
segment, sales of products supplied by Medtronic, Johnson & Johnson
and Becton Dickinson accounted for approximately 10%, 7% and 7% of
consolidated net revenue for 2018, respectively. OMI's ability to
sustain adequate operating earnings will continue to depend on its
ability to obtain favorable terms and incentives from suppliers,
timely shipments, as well as suppliers' continuing use of
third-party distributors to sell and deliver their products.
Acquisition of Byram and Halyard Health: Fitch views the home
health segment that OMI has entered through the Byram acquisition
as a logical extension of its relationship with existing supplier
customers, and should benefit from more favorable tailwinds and
customer concentration than in other post-acute settings.
Nonetheless, this segment has limited overlap with OMI's business,
and introduces new operational and financial risks. The acquisition
of the surgical and infection prevention business of Halyard Health
offers OMI the opportunity to increase its scale and profitability
by expanding the portfolio of products it can distribute through
its existing markets and to open new channels. However, the
contribution from these two acquisitions is largely offset by
substantially higher interest expense. Moreover, the acquisition
materially raises the company's financial risk at a time when its
legacy business is undergoing significant operating stress that is
also raising liquidity risk.
Modest FCF Relative to Pro Forma Debt: The shift in strategy to
emphasize leveraged acquisitions in response to accelerating
pricing pressure has not been successful; OMI's credit profile
carries significantly higher financial risk in May 2019 compared to
just a year ago after the Halyard acquisition was closed.
DERIVATION SUMMARY
OMI's Long-Term IDR of 'CCC+' reflects the company's significant
increase in financial risk following the leveraged acquisitions of
Byram Healthcare and the S&IP business of Halyard Health, as well
as heightened competition and accelerating pricing pressure in its
core business. These risks are somewhat offset by OMI's established
position as a leading healthcare distribution company, albeit at
low absolute margins. In the recent past, OMI has completed two
acquisitions for approximately $1.1 billion -- Byram Healthcare and
the Surgical and Infection Prevention business of Halyard Health,
Inc. The result is that Fitch's estimate of OMI's leverage (without
the benefit of credit agreement adjustments) is expected to remain
above 7x through YE 2019. The material increase in financial risk
along with continued pressure on liquidity, revenue and margins
supports an IDR of 'CCC+'. OMI's smaller scale in an industry with
high fixed costs, where scale influences leverage with suppliers
and customers, and significantly higher leverage all lead Fitch to
rate the company well below AmerisourceBergen Corp. (A-/ Stable),
Cardinal Health, Inc. (BBB/Stable) and McKesson Corp.
(BBB+/Stable). OMI competes with other regional and local
distributors, as well as customer self-distribution models and, to
a lesser extent, certain third-party logistics companies. In
contrast to other larger distributors, Fitch considers OMI to be
less diversified by customer, revenues and suppliers. The debt
ratings are the same across the entire capital structure reflecting
both its pari passu status and the strong legal and operational
ties between parent and subsidiaries.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
-- Total revenues decline by approximately 3.8% over the period
2019-2022, which is driven principally by pricing pressure and
customer churn in the core business offset by the contributions of
Byram and Halyard.
-- Operating EBITDA margins of around 2.20%-2.25%, which is
consistent with the contributions from recent acquisitions as well
as a lower base of revenues.
-- The Byram and Halyard acquisitions generate annualized revenue
growth of approximately 2% with low- to mid-single-digit and low
double digit EBITDA margins, respectively.
-- Total interest expense following the fourth amendment to the
credit agreement of approximately $100 million in 2019 compared to
approximately $30 million in 2017.
-- Fitch's estimate of sustainable FCF remains modest despite
elimination of common stock dividends, but benefits from the
reduction of LIFO reserves.
-- Fitch assumes OMI spends approximately $60 million per year on
Capex through the forecast period and ceases all share repurchase
activity.
RATING SENSITIVITIES
Developments That May, Individually or Collectively, Lead to
Positive Rating Action
-- Positive rating momentum is possible over the near term if OMI
can improve its customer retention levels and reinvigorate its
legacy business. In addition, if the Byram and Halyard acquisitions
continue to contribute revenue and EBITDA growth resulting in
debt/EBITDA and total adjusted debt/EBITDAR approaching 6.0x and
6.3x, respectively, the ratings could be upgraded. In addition,
Fitch will be evaluating whether OMI can reduce its dependence on
short-term borrowing and improve its cash conversion and EBITDA.
Developments That May, Individually or Collectively, Lead to
Negative Rating Action
-- A downgrade is possible if Fitch believes OMI will be unable
to maintain sufficient sources of liquidity to service its debt.
Fitch will monitor whether OMI can improve its customer retention
levels and reinvigorate its legacy business, while successfully
integrating its recent acquisitions. Also, if consolidated EBITDA
and cash generation are not expected to improve sufficiently to
offset the weakness in OMI's core business by YE 2019, such that
both debt/EBITDA and total adjusted debt/EBITDAR are expected to
exceed 8x, the rating could be downgraded.
LIQUIDITY
Weak Liquidity: OMI has weak liquidity, which is principally
comprised of a $400 million revolving credit facility; as of March
31, 2019, there was approximately $282 million of borrowings under
the facility - up from $210 million as of Dec. 31, 2018. The
continued reliance on the revolving credit facility as the
principal source of liquidity and the company's declining EBITDA
create refinancing risk and raises the potential for a breach in
the leverage covenant in the near term.
The company experienced significant deterioration in its operating
cash flow starting in 2017 and 2018 principally because of
heightened competition, accelerating pricing pressure; and poor
customer service. Deteriorating operating cash flow combined with
increased Capex and maintenance of common stock dividends generated
negative to minimal FCF. Fitch believes FCF will remain negative to
modest over the forecast period.
Laddered Maturities: The maturities of long-term debt are
manageable for the near term, but the amortization of such debt
along with interest expense will become an increasing challenge
unless earnings can be reinvigorated. The company's decision to cut
dividends will provide additional funding to service debt, but may
prove to be inadequate in light of the aforementioned challenges.
Rating Recovery
The recovery analysis uses a liquidation approach due to the large
amounts of the company's receivables and inventory, which results
in the total liquidation value available to creditors to be higher
than the estimated EV on a going-concern basis. Fitch assumes
advance rates on accounts receivable, inventory and net property
and equipment of 75%, 50% and 50%, respectively. The general
assumption is that cash on the balance sheet dissipates during or
before a bankruptcy that would be replaced by other lending
facilities. In addition, for purposes of the recovery analysis,
Fitch assumes an orderly liquidation of assets and distribution of
value according to priority of claims. Also, Fitch has assumed 10%
for administrative claims.
The secured credit facility and senior notes are secured by the
assets of the guarantors, which consist of substantially all
wholly-owned domestic subsidiaries, and a pledge of 65% of the
voting equity of foreign subsidiaries. The credit agreement and
senior notes rank pari passu on a senior secured basis and contain
cross-default provisions, which could result in the acceleration of
payments due in the event of default of either agreements.
FULL LIST OF RATING ACTIONS
Fitch has downgraded the following ratings:
Owens & Minor, Inc.
-- Long-Term IDR to 'CCC+' from 'B-'/Outlook Negative;
-- Senior secured notes to 'B-'/'RR3' from 'B'/'RR3'.
Owens & Minor Distribution, Inc. / Owens & Minor Medical, Inc. /
Barista Acquisition I, LLC / Barista Acquisition II, LLC/ O&M
Halyard, Inc.;
-- Long-Term IDR to 'CCC+' from 'B-'/Outlook Negative;
-- Senior secured revolving credit facility to 'B-'/'RR3' from
'B'/'RR3';
-- Senior secured term loan A-1 to 'B-'/'RR3' from 'B'/'RR3';
-- Senior secured term loan A-2 to 'B-'/'RR3' from 'B'/'RR3';
-- Senior secured term loan B to 'B-'/'RR3' from 'B'/'RR3'.
PARQ HOLDINGS: Moody's Withdraws Caa1 CFR on Debt Repayment
-----------------------------------------------------------
Moody's Investors Service has withdrawn Parq Holdings Limited
Partnership's Caa1 corporate family rating, Caa1-PD probability of
default rating, B2 senior secured term loan ratings, and negative
outlook.
RATINGS RATIONALE
Moody's has withdrawn all of Parq's ratings following the company's
refinancing and repayment of all rated debt.
Ratings Withdrawn:
Corporate Family Rating, Previously Caa1
Probability of Default Rating, Previously Caa1-PD
Senior Secured First Lien Term Loan, Previously B2 (LGD3)
Senior Secured Delayed Draw Term Loan, Previously B2 (LGD3)
Outlook, Previously Negative
PIONEER AIRCRAFT: Fitch to Rate $26MM Series C Notes 'BB(EXP)sf'
----------------------------------------------------------------
Fitch Ratings expects to assign the following ratings and Outlooks
to the Pioneer Aircraft Finance Limited notes:
-- $428,000,000 Series A notes 'A(EXP)sf'; Outlook Stable;
-- $75,000,000 Series B notes 'BBB(EXP)sf'; Outlook Stable;
-- $26,000,000 Series C notes 'BB(EXP)sf'; Outlook Stable.
The aircraft ABS notes will be co-issued by Pioneer Aircraft
Finance Limited (Pioneer Cayman) and Pioneer Aircraft Finance LLC
(Pioneer USA) (together as Pioneer). Pioneer Cayman is an exempted
company incorporated with limited liability under the laws of the
Cayman Islands, with tax residency in Ireland. Pioneer USA is a
special purpose limited liability company organized under the laws
of the State of Delaware and a wholly owned subsidiary of Pioneer
Cayman. Pioneer will co-issue the series A, B and C fixed rate
notes.
Pioneer expects to use the initial note and E Note proceeds to
acquire a portfolio of 18 aircraft, prefund the maintenance reserve
account (MRA), security deposit account (SDA), series C reserve
account and expense account, and pay certain expenses.
The pool will be serviced by Goshawk Management (Ireland) Limited
(GMIL; Servicer) and its affiliates, and the notes will be secured
by each aircraft's future lease payments and residual cash flows.
This is the first Fitch-rated aircraft ABS transaction serviced by
GMIL. GMIL is a wholly owned subsidiary of Goshawk Management
Holdings (Cayman) Limited (GMHCL; both not rated by Fitch),
focusing on acquiring, managing and trading commercial aircraft.
Pioneer Cayman will separately issue an E Note to Pioneer I Limited
(E Note Holder).
KEY RATING DRIVERS
Asset Quality - Liquid NB Aircraft - Positive: The pool is
comprised of 18 in-demand, Tier 1 aircraft, including 11 A320-200s
(53%), four B737-800s (20%) and one B737-900ER (6%) current
generation aircraft. The remainder is comprised of one Embraer E190
regional jet (RJ) at 3% and one B787-8 widebody (WB) aircraft at
18%, on lease to Ethiopian Airlines. The WA age of the pool is 5.3
years, which is on the younger end of the range for recent
transactions.
Lease Term and Maturity Schedule - Neutral: The weighted average
(WA) original lease term is 10.3 years with a WA remaining lease
term of 5.1 years, comparable to recently rated pools. Three leases
come due each in 2020 and 2021, representing 12% and 14%,
respectively, while five come due in 2022, totaling 49% across
these three years. The B787-8 WB aircraft on lease to Ethiopian has
an 8.2-year remaining lease term expiring in 2027 and is the
highest aircraft concentration at ~20% of contracted pool cash
flow, and thus, Fitch separately stressed this aircraft to evaluate
residual value sensitivity.
Lessee Credit Risk - Relatively Diverse: The 18 aircraft in the
pool are leased to 18 lessees, which is a credit positive. There
are a high number of unrated or speculative grade airlines, albeit
lower than recent aircraft ABS deals. Fitch assumed unrated lessees
would perform consistent with either a 'B' or 'CCC' Long Term
Issuer Default Rating to accurately reflect default risk. Lessee
ratings were further stressed in future recessions and once
aircraft reach Tier 3 classification.
Country Credit Risk - Neutral: The largest country concentration is
Ethiopia (18%), which has a LT IDR of 'B', with a Stable Outlook,
supported by strong economic growth and constrained by large
macroeconomic imbalances and low development and governance
indicators. The second largest is India (17%) with three aircraft,
which faces high bureaucratic hurdles, infrastructure limitations
and a highly competitive airline market with notable prior airline
bankruptcies. Fitch recently affirmed India's IDR at 'BBB-' with a
Stable Outlook. The next largest country concentrations are the
U.S. (7%), Indonesia (6%) and Thailand (6%). The top 5 countries
total 54%, with 49% of lessees concentrated in APAC.
Operational and Servicing Risk - Adequate Servicing Capability: The
pool will depend on the ability of GMIL (NR by Fitch) to collect
rent payments, remarket and repossess aircraft in an event of
lessee default, and procure maintenance to retain asset values and
ensure stable performance. Despite being established in 2015, Fitch
believes GMIL to be a capable Servicer as evidenced by the solid
capabilities and experience of its team and servicing of its owned
and managed fleet (including the SJETS 2017-1 ABS [NR by Fitch]),
along with third-party aircraft management experience.
Transaction Structure - Consistent: Credit enhancement comprises
overcollateralization, a liquidity facility and a cash reserve. The
initial loan to value ratios for the series A, B and C notes are
66.9%, 78.6% and 82.6%, respectively, based on the average of
maintenance-adjusted base value. Structural features include DSCR
trigger, utilization thresholds, concentration limits and tiered
disposition limits, consistent with recent aircraft ABS
transactions.
Adequate Structural Protections: Each series of notes makes full
payment of interest and principal in the primary scenarios
commensurate with their expected ratings after applying Fitch's
stressed asset and liability assumptions. Fitch also created
multiple alternative cash flows to evaluate the structure
sensitivity to different scenarios detailed later in the report.
Aviation Market Cyclicality: Commercial aviation has been subject
to significant cyclicality due to macroeconomic and geopolitical
events. Fitch's analysis assumes multiple periods of significant
volatility over the life of the transaction. Downturns are
typically marked by reduced aircraft utilization rates, values and
lease rates, as well as deteriorating lessee credit quality. Fitch
employs aircraft value stresses in its analysis, which takes into
account age and marketability to simulate the decline in lease
rates expected over the course of an aviation market downturn, and
the decrease to potential residual sales proceeds.
Rating Cap of 'Asf': Fitch limits aircraft operating lease ratings
to a maximum cap of 'Asf' due to the factors, and the potential
volatility they produce.
RATING SENSITIVITIES
The performance of aircraft ABS can be affected by various factors,
which, in turn, could have an impact on the assigned ratings. Fitch
conducted multiple rating sensitivity analyses to evaluate the
impact of changes to a number of the variables in the analysis.
These sensitivity scenarios were also considered in determining the
ratings.
Widebody Stress Scenario
Approximately 18% of the pool is concentrated in a single widebody
aircraft, the WB B787-8 Dreamliner. Due to the density of
contractual cash flows attributed to one aircraft, Fitch created a
scenario in which the WB aircraft encountered heightened stress to
residual values. Fitch assumed immediate migration to Tier 3 from
Tier 1 to stress depreciation rates and recessionary value declines
and further lowered its residual credit to 25% from base 50%. Under
this scenario, the cash flow declined from the primary scenario by
6%. All three series pass their respective rating scenarios and are
unlikely to experience rating downgrades.
Lease Rate Factor Scenario
Increased competition, largely from newly established APAC lessors,
has contributed to declining lease rates in the aircraft leasing
market over the past few years. Additionally, certain variants have
been more prone to value declines and lease rates due to oversupply
issues. Fitch performed a sensitivity analysis assuming lease rate
factors would not increase after an aircraft reached 11 years of
age, providing a material haircut to future lease cash flow
generation. Per Fitch's criteria LRF curve, no subsequent leases
were executed at a LRF greater than 1.13%. This scenario highlights
the effect of increased competition in the aircraft leasing market,
particularly for mid- to end-of-life aircraft over the past few
years, and stresses the pool to a higher degree by assuming lease
rates well below observed market rates. Under this scenario, the
cash flow declined from the primary scenario by 5%. All three
series pass their respective rating scenarios and are unlikely to
experience rating downgrades.
'CCC' Unrated Lessee Stress Scenario
Fitch evaluated a scenario in which all unrated airlines are
assumed to carry a 'CCC' rating. This scenario mimics a prolonged
recessionary environment in which airlines are susceptible to an
increased likelihood of default. This would, in turn, subject the
aircraft pool to more downtime and expenses as repossession and
remarketing events would increase. Under this scenario, the notes
show greater sensitivity with a sharper decline in cash flow by
13%-18% from the primary scenario. Series A could be considered for
a downgrade by up to two rating categories and series B and C notes
by up to one rating category each.
Technological Obsolescence Stress Scenario
The last sensitivity scenario is to address technological
replacement risk for current technology equipment. All aircraft in
the pool face replacement programs over the next decade,
particularly the A320ceo and B737 NG aircraft in the form of
A320neo and B737 MAX aircraft. Therefore, Fitch utilized a scenario
in which demand, and thus values, of existing aircraft would fall
significantly due to the replacement technology. The first
recession was assumed to occur two years following close, and all
recessionary value decline stresses were increased 10% at each
rating category. Fitch conducted two sets, utilizing a 25% and 15%
residual assumption rather than the base level of 50% to stress
end-of-life proceeds for each asset in the pool. Lease rates drop
fairly significantly under this scenario, and aircraft are
essentially sold for scrap at the end of their useful lives. Under
the 25% assumption, each series remains able to pay in full. Under
the 15% assumption, series A and C notes could be considered for a
downgrade by up to one rating category each.
PREFERRED PROPPANTS: Moody's Lowers CFR to 'C', Outlook Stable
--------------------------------------------------------------
Moody's Investors Service downgraded Preferred Proppants, LLC's
Corporate Family Rating to C from Caa3, Probability of Default
Rating to D-PD from Caa3-PD, and senior secured term loan rating to
C (LGD6) from Caa2 (LGD2). The outlook was changed to stable from
negative.
RATINGS RATIONALE
The rating action was prompted by Preferred Proppants' completion
of an out-of-court restructuring transaction on February 8, 2019,
where its first lien senior secured term loan tranches were either
converted to equity or eliminated, and second lien debt was
extinguished in its entirety. Moody's views these transactions as
distressed exchanges and events of default as they reflect a
failure to meet the original promise under the debt agreements and
result in significant losses to lenders. The ratings reflect low
recovery levels associated with the event of default that occurred.
The outlook reflects the fact that restructuring has been
completed.
The following rating actions were taken:
Issuer: Preferred Proppants, LLC:
Corporate Family Rating, downgraded to C from Caa3
Probability of Default, downgraded to D-PD from Caa3-PD
Senior secured term loan, downgraded to C (LGD6) from Caa2 (LGD2)
Outlook, changed to stable from negative.
Moody's will withdraw all of its ratings for Preferred Proppants as
the rated debt no longer exists.
The principal methodology used in these ratings was Building
Materials Industry published in January 2017.
Preferred Proppants, LLC, headquartered in Radnor, PA, is a
producer and distributor of sand and resin coated proppants used in
North American oil and gas drilling. KKR had been the sponsor of
Preferred Proppants. The company generated approximately $314
million in revenue for the 12 months ended December 31, 2018.
PRINCETON AVENUE GROUP: Case Summary & 7 Unsecured Creditors
------------------------------------------------------------
Debtor: Princeton Avenue Group, Inc.
12 S. Princeton Ave.
Wenonah, NJ 08090
Business Description: Princeton Avenue Group, Inc. is the fee
simple owner of a property located at
1301 Kings Highway, Swedesboro having an
appraised value of $710,000.
Chapter 11 Petition Date: May 14, 2019
Court: United States Bankruptcy Court
District of New Jersey (Camden)
Case No.: 19-19841
Judge: Hon. Jerrold N. Poslusny Jr.
Debtor's Counsel: Ellen M. McDowell, Esq.
MCDOWELL LAW, PC
46 W. Main St.
Maple Shade, NJ 08052
Tel: 856-482-5544
Fax: 856-482-5511
E-mail: emcdowell@mcdowelllegal.com
Total Assets: $722,600
Total Liabilities: $2,020,505
The petition was signed by Konstantinos Tzitzifas, president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's seven unsecured creditors is available for
free at:
http://bankrupt.com/misc/njb19-19841.pdf
PUMAS CAB: Plan Increases Distribution to New York DOTF to 28.7%
----------------------------------------------------------------
Pumas Cab Corp. filed a third amended disclosure statement
describing its third amended plan of reorganization.
The latest plan amends the treatment of the unsecured non-priority
portion of the New York State Department of Taxation & Finance's
claim. The Department will now receive a distribution of 28.7%
instead of 9.1% in one lump sum payment on the Effective Date of
the plan.
A copy of the Third Amended Disclosure Statement is available at
https://tinyurl.com/y64wl8fj from Pacermonitor.com at no charge.
A copy of the Third Amended Plan is available at
https://tinyurl.com/y4s8c2b8 from Pacermonitor.com at no charge.
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.
QUARRY SERVICES: Taps Mark Bryant CPA as Accountant
---------------------------------------------------
Quarry Services, LLC, received approval from the U.S. Bankruptcy
Court for the Northern District of Georgia to hire Mark Bryant CPA,
P.C., as its accountant.
The Debtor requires the services of the firm to complete its
monthly operating reports. The firm will charge an hourly fee of
$115.
Mark Bryant, a certified public accountant and shareholder of the
firm, disclosed in court filings that he and his employees are
"disinterested" as defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Mark Bryant
Mark Bryant CPA, P.C.
1755 The Exchange, Suite 110
Atlanta, GA 30339
Phone: 678-903-5120
About Quarry Services
Quarry Services, LLC, Confinement Management Systems, LLC, and
Mining Solutions, LLC operate a drilling and mining business
servicing customers across the Southeast. Charles Selman owns the
companies' membership interests. The companies have the same
secured creditors and are part of one business operation.
On Jan. 22, 2019, Quarry Services, Confinement Management Systems
and Mining Solutions sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 19-20103). At the
time of the filing, Quarry Services estimated assets of $1 million
to $10 million and liabilities of $1 million to $10 million. The
cases are assigned to Judge James R. Sacca. Wiggam & Geer, LLC, is
the Debtor's counsel.
QUARRY SERVICES: To Pay Unsecureds $300K in Quarterly Installments
------------------------------------------------------------------
Quarry Services, LLC, Confinement Management Systems, LLC and
Mining Solutions, LLC filed a disclosure statement with regard to
their chapter 11 plan dated April 30, 2019.
Class 13 under the plan consists of all general unsecured creditors
of the Debtor, including all Secured Claimants' deficiency claims
that are reclassified as Class 13 claimants. Holders of Class 13
claims will be paid $300,000 in quarterly installments beginning on
the 3-month anniversary after the Effective Date and continuing for
5 years for a total of 20 payments of $15,000. This class is
impaired and entitled to vote. Nothing herein shall constitute an
admission as to the nature, validity, or amount of any claim.
Debtor reserves the right to object to any and all claims.
The source of funds for payments pursuant to the Plan will be the
post-confirmation income of the Debtor derived from its drilling
operations.
A copy of the Disclosure Statement dated April 30, 2019 is
available at https://tinyurl.com/y4xj8kj3 from Pacermonitor.com at
no charge.
About Quarry Services
Quarry Services, LLC, Confinement Management Systems, LLC, and
Mining Solutions, LLC operate a drilling and mining business
servicing customers across the Southeast. Charles Selman owns the
companies' membership interests. The companies have the same
secured creditors and are part of one business operation.
On Jan. 22, 2019, Quarry Services, Confinement Management Systems
and Mining Solutions sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ga. Lead Case No. 19-20103). At the
time of the filing, Quarry Services estimated assets of $1 million
to $10 million and liabilities of $1 million to $10 million. The
cases are assigned to Judge James R. Sacca. Wiggam & Geer, LLC, is
the Debtor's counsel.
RIOT BLOCKCHAIN: Incurs $13.75 Million Net Loss in First Quarter
----------------------------------------------------------------
Riot Blockchain, 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 $13.75 million on $1.43 million of total
revenue for the three months ended March 31, 2019, compared to a
net loss of $16.56 million on $925,554 of total revenue for the
three months ended March 31, 2018.
As of March 31, 2019, Riot Blockchain had $15.44 million in total
assets, $24.21 million in total liabilities, and a total
stockholders' deficit of $8.76 million.
The Company has experienced recurring losses and negative cash
flows from operations. At March 31, 2019, the Company had
approximate balances of cash and cash equivalents of $1,000,000,
digital currencies of $1,085,000, a working capital deficit of
$18,561,000, total stockholders' deficit of $8,769,000 and an
accumulated deficit of $210,728,000. To date, the Company has, in
large part, relied on equity and debt financing to fund its
operations.
The Company said its primary focus is on its digital currency
mining operation located in Oklahoma City, Oklahoma, along with its
investigation of the launch of RiotX as a digital currency exchange
in the United States. That operational focus and the Company's
acquisitions of Kairos and 1172767 B.C. Ltd., formerly known as
Tess Inc., and its investment in goNumerical Ltd. (d/b/a
"Coinsquare"), as well as the Company's name change, reflects a
strategic decision by the Company to operate in the blockchain and
digital currency related business sector. The Company's current
strategy will continue to expose the Company to the numerous risks
and volatility associated within this sector.
The Company expects to continue to incur losses from operations for
the near-term and these losses could be significant as the Company
incurs costs and expenses associated with recent and potential
future acquisitions, and development of the RiotX exchange
platform, as well as public company, legal and administrative
related expenses being incurred. During the three months ended
March 31, 2019, for a total investment of $3,000,000, the Company
issued a series of Senior Secured Convertible Promissory Notes, to
investors for an aggregate principal amount of $3,358,333 and an
equal value of warrants for the purchase of shares of the Company's
common stock. The Company is closely monitoring its cash balances,
cash needs and expense levels.
The Company believes that in order for it to meet its obligations
arising from normal business operations for the next twelve months,
the Company requires additional capital either in the form of
equity or debt. Without additional capital, the Company's ability
to continue to operate will be limited. If the Company is unable
to obtain adequate capital, it could be forced to cease or reduce
its operations. The Company is currently pursuing capital
transactions in the form of debt and equity, however, the Company
cannot provide any assurance that it will be successful in its
plans.
A full-text copy of the Form 10-Q is available for free at:
https://is.gd/I0WShJ
About Riot Blockchain
Headquartered in , Castle Rock, Colorado, Riot Blockchain --
http://www.RiotBlockchain.com/-- is focused on building,
operating, and supporting blockchain technologies. Its primary
operations consist of cryptocurrency mining, targeted development
of a cryptocurrency exchange, and the identification and support of
innovations within the sector.
Riot Blockchain reported a net loss of $60.21 million in 2018,
following a net loss of $19.97 million in 2017. As of Dec. 31,
2018, the Company had $13.86 million in total assets, $9.36 million
in total liabilities, and $4.49 million in total stockholders'
equity.
Marcum LLP, in New York, the Company's auditor since 2018, issued a
"going concern" qualification in its report dated April 2, 2019, on
the Company's consolidated financial statements for the year ended
Dec. 31, 2018, citing that the Company has a significant working
capital deficiency, has incurred significant losses, and needs to
raise additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
ROCK CREEK BAPTIST: Case Summary & 13 Unsecured Creditors
---------------------------------------------------------
Debtor: Rock Creek Baptist Church of the District of Columbia
d/b/a Rock Creek Baptist Church
Post Office Box 3028
Upper Marlboro, MD 20773
Business Description: Rock Creek Baptist Church of the District of
Columbia is a religious organization
headquartered in Marlboro, Maryland.
Chapter 11 Petition Date: May 14, 2019
Court: United States Bankruptcy Court
District of Maryland (Greenbelt)
Case No.: 19-16565
Judge: Hon. Lori S. Simpson
Debtor's Counsel: Brett Weiss, Esq.
THE WEISS LAW GROUP, LLC
6404 Ivy Lane, Suite 650
Greenbelt, MD 20770
Tel: 301-924-4400
Fax: 240-627-4186
E-mail: brett@bankruptcylawmaryland.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Jeffrey L. Mitchell, Sr., pastor.
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/mdb19-16565.pdf
SANCHEZ ENERGY: Signs Services Agreements with Top Executives
-------------------------------------------------------------
Sanchez Energy Corporation had entered into these arrangements
approved by the Special Committee of the Board of Directors of the
Company:
(a) Executive Services Agreements between the Company and each
of: (1) A.R. Sanchez, Jr., executive chairman of the Board
(2) Antonio R. Sanchez, III, president and chief executive
officer; (3) Patricio D. Sanchez, executive vice
president; (4) Cameron W. George, executive vice president
and chief financial officer; and (5) Gregory B. Kopel,
executive vice president, general counsel and secretary.
(b) The 2019 Executive Incentive Plan of the Company.
Executive Services Agreements
The Executive Services Agreements were entered into effective as of
May 6, 2019. Each respective Executive Service Agreement provides
(i) that the applicable executive will continue to serve in his
current executive officer position with the Company as an employee
of Sanchez Oil & Gas Corporation, (ii) for an annual base salary
(Mr. Sanchez, Jr.: $820,000; Mr. Sanchez, III: $820,000; Mr. P.
Sanchez: $300,000; Mr. George: $550,000; and Mr. Kopel: $500,000),
and (iii) for eligibility to receive an annual cash bonus based on
a qualitative assessment of financial and individual performance
achievements.
Under each Executive Services Agreement, in the event of the
applicable executive's termination as an officer of the Company due
to the executive's death, "disability," by the Company without
"cause" or by the executive due to "good reason" (as such terms are
defined in the Executive Services Agreement), the executive (or the
executive's designated beneficiaries, as applicable) will be
entitled to receive payment of: (i) any unpaid annual bonus for the
year prior to the year of termination and (ii) a pro-rated annual
bonus for the year of termination. In addition, the executive will
also be entitled to receive the following severance payments or
benefits in the event of the executive's termination by the Company
without "cause" or by the executive due to "good reason": (x) a
lump-sum cash payment equal to two times the annual base salary and
two times the largest annual bonus paid (or due to be paid) to the
executive for the year in which the termination occurs or any year
in the three calendar year period immediately preceding the date of
termination and (y) payment of the COBRA premiums for the executive
and the executive's eligible dependents during the COBRA
continuation period.
2019 Executive Incentive Plan
The Plan is a cash incentive program under which Mr. Sanchez, Jr.,
Mr. Sanchez, III, Mr. P. Sanchez, Mr. George and Mr. Kopel received
an initial upfront bonus payment with respect to the first quarter
of 2019 and are eligible to earn quarterly performance bonus
payments with respect to the second, third and fourth quarters of
the Company's 2019 fiscal year calculated and determined based on
the achievement of certain quarterly and year-to-date performance
objectives related to key performance measures of the Company
(average daily production (Boe/d), production expenses per Boe and
cash general and administrative expenses. Each of the Performance
Metrics is weighted as follows in determining the total amount the
Participant is eligible to earn under the Plan: 33.3% for average
daily production (Boe/d); 33.3% for production expenses per Boe;
and 33.4% for Cash G&A.
The Plan will be in effect from May 6, 2019 until Dec. 31, 2019,
unless earlier terminated. Awards under the Plan are intended to
be made to the Participants in lieu of any cash-based or
equity-based awards under the Company's or SOG's existing
compensation or incentive plans going forward, for the duration of
the Term.
The actual quarterly performance bonuses that may be payable under
the Plan for each Quarter will be determined and paid based on the
level of achievement with respect to quarterly and year-to-date
threshold, target and maximum performance goals for each
Performance Metric as of the end of each Quarter. Additionally, in
the event the aggregate quarterly bonus payments received under the
Plan with respect to such Quarters are less than a recalculated
bonus amount based on the Company's cumulative overall 2019 fiscal
year performance, a Participant will be entitled to receive a
one-time reconciling payment equal to the difference. On the other
hand, in the event the aggregate quarterly bonus payments received
under the Plan with respect to such Quarters are greater than a
recalculated bonus amount based on the Company's cumulative overall
2019 fiscal year performance, the Company is entitled to recover
the difference from the Participant (provided that in no event
shall a Participant be required to forfeit his initial upfront
bonus).
In the event the Participant is terminated due to death,
"disability," without "cause" or by the executive due to "good
reason" (as such terms are defined in the Executive Services
Agreements) prior to the end of the Term, the Participant will be
paid a pro-rated quarterly performance bonus for the Quarter in
which such termination occurs and forfeit any subsequent quarterly
performance bonuses. In the event of the Participant's termination
for any other reason prior to the end of the Term, the Participant
will forfeit the right to receive any quarterly performance bonus
for the Quarter in which the termination occurs and any subsequent
quarterly performance bonuses.
The aggregate threshold, target and maximum amounts that may be
paid to the Participants named above with respect to the three
Quarters are approximately:
* For Mr. Sanchez, Jr., $1,578,500 (threshold amount);
$3,157,000 (target amount); and $6,314,000 (maximum amount).
* For Mr. Sanchez, III, $1,578,500 (threshold amount);
$3,157,000 (target amount); and $6,314,000 (maximum amount).
* For Mr. P. Sanchez, $500,000 (threshold amount); $1,000,000
(target amount); and $2,000,000 (maximum amount).
* For Mr. George, $789,250 (threshold amount); $1,578,500
(target amount); and $3,157,000 (maximum amount).
* For Mr. Kopel, $516,250 (threshold amount); $1,032,500
(target amount); and $2,065,000 (maximum amount).
These amounts assume that all payments are made with respect to the
applicable Performance Metrics and performance goal (threshold,
target or maximum).
In addition to the foregoing, the Participants received an upfront
bonus under the Plan in the following amounts:
* Mr. Sanchez, Jr.: $1,353,000.
* Mr. Sanchez, III, $1,353,000.
* Mr. P. Sanchez: $252,000.
* Mr. George: $676,500.
* Mr. Kopel: $442,500.
About Sanchez Energy
Headquartered in Houston, Texas, Sanchez Energy Corporation --
http://www.sanchezenergycorp.com/-- is an independent exploration
and production company focused on the acquisition and development
of oil and natural gas resources in the onshore United States. The
Company is currently focused on the horizontal development of
significant resource potential from the Eagle Ford Shale in South
Texas, and it also holds other producing properties and undeveloped
acreage, including in the Tuscaloosa Marine Shale in Mississippi
and Louisiana which offers potential future development
opportunities.
The Company reported a net loss attributable to common stockholders
of $3.46 million in 2018, following a net loss attributable to
common stockholders of $35.05 million in 2017. As of Dec. 31,
2018, Sanchez Energy had $2.81 billion in total assets, $2.81
billion in total liabilities, $452.82 million in mezzanine equity,
and a total stockholders' deficit of $444.52 million.
* * *
As reported by the TCR on Nov. 12, 2018, S&P Global Ratings lowered
its issuer credit rating on Sanchez Energy Corp. to 'CCC' from 'B'
and revised the outlook to negative from stable. S&P said "The
downgrade reflects our view that Sanchez' capital structure is
unsustainable and that the risk of debt restructuring is high.
Also in November, 2018, Moody's Investors Service downgraded
Sanchez Energy Corporation's B3 Corporate Family Rating to 'Caa1'.
"Sanchez's ratings downgrade reflects its stubbornly high debt
levels and disappointing production results attributable to its
$1.05 billion (net) acquisition of additional Eagle Ford Shale
acreage in March 2017, which has pressured its liquidity and
prompted Moody's concern that the company's capital structure as
presently constituted may be unsustainable," commented Andrew
Brooks, Moody's vice president.
SIRIUS COMPUTER: Moody's Gives B2 CFR Amid Buyout, Outlook Stable
-----------------------------------------------------------------
Moody's Investors Service assigned a B2 Corporate Family Rating and
a B2-PD Probability of Default Rating to Sirius Computer Solutions,
Inc. As part of the rating action, Moody's assigned a Ba3 rating to
the company's proposed $190 million 1st lien senior secured
revolver and $750 million 1st lien sr secured term loan, and a Caa1
rating to the company's proposed $300 million of sr unsecured
notes. The rating outlook is stable.
Proceeds from the new borrowings, in addition to $500 million in
contributed and rolled over equity, will be used to fund the
roughly $1.5 billion acquisition by Clayton, Dubilier & Rice, repay
existing debt, and pay related expenses. The assigned ratings are
subject to review of final documentation and no material change in
the terms and conditions of the transaction as advised to Moody's.
At close of the transaction, all existing ratings at Sirius
Computer Solutions, Inc. will be withdrawn.
RATINGS RATIONALE
The credit profile of Sirius Computer Solutions, Inc. reflects its
small scale compared to competing IT value-added resellers and
managed services firms, and the evolving requirements of IT
deployments for enterprises including the ongoing transition to
cloud platforms. The proposed buyout by CD&R results in adjusted
debt to EBITDA of roughly 6.0x at closing (Moody's adjusted, with
partial credit for synergies, or 6.4x excluding synergies).
Although improved with the Forsythe acquisition at the end of 2017,
the company has high vendor concentration, with 49% of the
company's gross revenues represented by Cisco and IBM products and
services, compared to over 80% six years ago.
Moody's recognizes, however, that Sirius Computer remains the
largest value-added-reseller of IBM's IT solutions serving
primarily large enterprises and medium-sized businesses in the US.
The company has made progress in diversifying its vendor base to
include products from Cisco, Dell EMC, HP Enterprise, NetApp, and
Nutanix which supports its continuing profitability and good free
cash flow generation given minimal capital investment requirements.
Although revenues for the fiscal year ended December 2018, are up
less than 1%, adjusted EBITDA increased more than 9% reflecting
realized synergies from the Forsythe acquisition (closed November
2017).
Moody's expects Sirius Computer to maintain good liquidity over the
next 12 months supported by modest cash balances, adjusted free
cash flow of at least $70 million (roughly 7% free cash flow to
debt), and the new $190 million revolver (undrawn at closing). Good
free cash flow reflects low reported annual capital expenditures
(less than 2% of net revenue) and modest working capital needs with
minimal seasonality.
Ratings for Sirius Computer's debt instruments reflect the B2-PD
overall probability of default and an expected average family
recovery in a default scenario. The Ba3 rating assigned to the 1st
lien sr secured credit facilities is two notches above the CFR
reflecting the facilities' senior position in the capital
structure. The sr unsecured notes are rated Caa1, two notches below
the CFR, reflecting their position behind the 1st lien facilities.
The stable outlook reflects Moody's expectation that Sirius
Computer will maintain its leading market position as a value-added
reseller of IT products and services to the mid-tier market in the
US, and will produce consistent levels of operating profits and
cash flows to enable leverage reduction and growth investments.
Ratings could be upgraded if the company continues to diversify its
customer base, maintains organic revenue and cash flow growth, and
improves its credit metrics resulting in adjusted debt to EBITDA
falling below 4.0 times on a sustained basis, and adjusted EBITDA
to Interest coverage rising above 4.0 times. Ratings could be
downgraded if a significant decline in revenue or cash flow lead to
adjusted debt to EBITDA being sustained around 6.0x or if Moody's
expects liquidity could be weakened as a result of changes in
payment terms to its vendors, other working capital pressures,
underperformance, distributions, or acquisitions.
The following ratings were assigned:
Issuer: Sirius Computer Solutions, Inc. (New)
Corporate Family Rating -- Assigned B2
Probability of Default Rating -- Assigned B2-PD
1st Lien Senior Secured Term Loan-- Assigned Ba3 (LGD2)
1st Lien Senior Secured Revolving Credit Facility--
Assigned Ba3 (LGD2)
Sr Unsecured Global Notes -- Assigned Caa1 (LGD5)
Outlook Action:
Issuer: Sirius Computer Solutions, Inc. (New)
Outlook is stable
The principal methodology used in these ratings was Business and
Consumer Service Industry published in October 2016.
Sirius Computer Solutions, Inc. (New), headquartered in San
Antonio, TX, is a leading value-added-reseller of IT solutions
serving businesses and government entities in the US. The company
provides a full suite of IT infrastructure solutions, including
hardware, software, and services to more than 5,700 customers
across financial, healthcare, professional services, federal
government, insurance, manufacturing, and educational sectors. Over
the next 12 months, Moody's expects the company to generate net
revenues exceeding $800 million (adjusting for ASC 606).
SOUTHERN ILLINOIS UNIVERSITY: Moody's Hikes $24MM COPs to Ba3
-------------------------------------------------------------
Moody's Investors Service has revised the outlook of Southern
Illinois University to stable from negative. Moody's has also
affirmed the Ba2 on $177 million of outstanding Housing & Auxiliary
Facilities System Revenue Bonds and upgraded to Ba3 from B1 the
rating on $24 million of outstanding Certificates of
Participation.
RATINGS RATIONALE
The outlook revision to stable from negative reflects Southern
Illinois University's stronger liquidity and improved operating
performance, which is expected to continue over the next two years.
Management continues to take action to align the university's
expense base with declining enrollment and revenue. Favorably,
after a multi-year very difficult period in state funding, the
university received full state direct operating appropriations for
fiscal 2018, ending June 30, plus "backfill" for half of fiscal
2017 funding and the MAP financial assistance grants.This improved
liquidity to over 80 days for fiscal 2018, still thin but markedly
improved from the 39 days for fiscal year 2017 and still higher
than prior years. Also incorporated in the outlook revision are its
current expectations for modest increases in state funding from the
State of Illinois (Baa3 stable) over the outlook period. Combined
direct operating appropriations and "on behalf" benefit payments
represent over half of the university's operating revenue.
The university's ratings also reflects SIU's sizeable operating
scale with over $1.2 billion in revenue as a multi-campus
comprehensive public university. SIU has a modest and manageable
debt burden although a high age of plant highlights potential
future capital needs. Enrollment declines are an additional credit
challenge with an 8% decrease in fall 2018 total enrollment due to
falling enrollment at its Carbondale (SIUC) campus with a smaller
decline at the Edwardsville (SIUE) campus. Continued uncertainty
around the long-term stability of state funding for both operations
and pension and other post-retirement benefits due to the state's
own fiscal condition are an additional fundamental credit
constraint.
The Ba2 rating on the Housing & Auxiliary Facilities System Revenue
(HAFS) bonds additionally incorporates the system's healthy cash
flow and debt service coverage and good reserves in the closed
system. The upgrade to Ba3 on the COPs reflects improvement in
legally available funds and liquidity, reducing the likelihood of
termination of the purchase contract. The rating differential from
the HAFS bonds incorporates the unsecured nature of the pledge,
with the ability to terminate the purchase contract upon
non-appropriation of state funds and non-availability of funds.
RATING OUTLOOK
The stable outlook reflects expectations of generally stable state
operating appropriations for fiscal 2020 with timing of payments
consistent with fiscal 2019. Also included is the expectation that
SIU can manage through enrollment pressures at SIUC with expense
measures.
FACTORS THAT COULD LEAD TO AN UPGRADE
- Multi-year material improvement in the state's fiscal condition
resulting in greater predictability in the amount and timing of
state funding
- Growing enrollment leading to increased net tuition revenue and
decreasing reliance on state funding for operations
- Substantial growth in balance sheet reserves to mitigate
exposure to volatile or declining state funding
FACTORS THAT COULD LEAD TO A DOWNGRADE
- Sustained decline in directly paid state operating support or
benefits provided through "on behalf" payments
- Material weakening of liquidity or inability to maintain sound
operating performance
- Inability to curb enrollment losses leading to sustained net
tuition revenue declines
LEGAL SECURITY
The Housing and Auxiliary Facilities System (HAFS) Revenue Bonds
are secured by a pledge of and lien on the net revenues of the
auxiliary system, pledged tuition (equal to MADS), the bond and
interest sinking fund account, and the repair and replacement
reserve account. The auxiliary system includes housing, student
unions, recreation and fitness centers, other services on both
campuses and the parking facilities at the Edwardsville campus.
There is a rate covenant requiring that the net revenues and
pledged tuition equal to 120% of MADS. Pledged revenues provided
2.1x MADS coverage for fiscal 2018. HAFS is a "closed" system and
excess revenues generated by the HAFS cannot be used for non-system
purposes. HAFS reserves remain favorable with over $67 million cash
and investments for June 30, 2018. SIU projects similar coverage
for fiscal 2019.
The Certificates of Participation (COPs) are unsecured but payable
from legally available funds. Legally available funds include
student tuition (subordinate to the pledge to HAFS and Medical
Facilities System), certain fees, allowable grants, and investment
income. A portion of a mandatory per credit hour facilities
maintenance fee pays part of the COPs' debt service. The obligation
to pay the COPs can be terminated in the event SIU does not receive
sufficient state appropriations and has no other legally available
funds. The board has covenanted to request funds sufficient to pay
debt service from the Illinois General Assembly in its annual
operating budget request, and to include in each of SIU's annual
operating budget an amount of legally available non-appropriated
funds that with state appropriated funds is to cover debt service.
PROFILE
Southern Illinois University is a large comprehensive university
with over 26,000 total headcount enrollment across its flagship
Carbondale (SIUC) campus, Edwardsville (SIUE), and medical
campuses. For fiscal 2018 SIU reported over $1.2 billion of total
operating revenue. It offers a broad range of undergraduate and
graduate programs, including engineering, law, pharmacy, medicine,
dental and nursing.
SPECIALTY RETAIL: $2.2-Mil. Sale of Visa/MasterCard Claim Approved
------------------------------------------------------------------
BankruptcyData.com reported that the Court hearing the Specialty
Retail Shops Holding Corp (Shopko) case issued an order approving
the sale of the Debtors' Visa/Mastercard class action claim to
Halcyon Loan Trading Fund LLC (the "Purchaser") for $2.2 million.
The Visa/Mastercard class action plaintiffs allege that Visa,
MasterCard, and major credit card issuers engaged in a conspiracy
to fix interchange fees, also known as swipe fees, that are charged
to merchants for the privilege of accepting payment cards, at
artificially high levels. In furtherance of the sale of this asset,
the Debtors obtained data for the period of January 1, 2004 to
December 31, 2018 showing credit card interchange fees of
approximately $166 million.
The Debtors previously noted that on September 12, 2013, the United
States District Court of the Eastern District of New York held a
final approval hearing concerning the Visa/MasterCard Case, the
related Visa/MasterCard Claim settlement agreement, and entered an
order (the 'Proposed Class Settlement Order') on January 14, 2014.
The Proposed Class Settlement Order was rejected by the United
States Court of Appeals for the Second Circuit for conflict of
interest issues; however the settlement was approved (the 'Class
Settlement Order') on January 28, 2019. Pursuant to the
court-authorized settlement website, '[t]he Court has preliminarily
approved a proposed settlement of a maximum of approximately $6.24
billion and a minimum of at least $5.54 billion in a class action
lawsuit.'
The Debtors noted that they received and entertained inquiries from
various parties interested in purchasing the Visa/MasterCard Claim
before selecting Halcyon Loan.
About Specialty Retail Shops
Specialty Retail Shops Holding Corp. and its affiliates are engaged
in the sale of general merchandise including clothing, accessories,
electronics, and home furnishings, as well as company-operated
pharmacy and optical services departments. They are headquartered
in Green Bay, Wisconsin, and operate 367 stores in 25 states
throughout the United States as well as e-commerce operations.
They currently employ approximately 14,000 people throughout the
United States.
Specialty Retail Shops Holding and its affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Neb. Lead Case
No. 19-80064) on Jan. 16, 2019. At the time of the filing, the
Debtors estimated assets of $500 million to $1 billion and
liabilities of $1 billion to $10 billion.
The cases are assigned to Judge Thomas L. Saladino.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as general bankruptcy counsel; McGrath North
Mullin & Kratz, P.C. LLO as local counsel; Houlihan Lokey Capital,
Inc., as investment banker; Berkeley Research Group, LLC, as
restructuring advisor; Hilco Real Estate, LLC as real estate
consultant; Willkie Farr & Gallagher LLP as special counsel; Ducera
Partners LLC as financial advisor; and Prime Clerk LLC as notice
and claims agent.
A seven-member panel has been appointed as official unsecured
creditors committee in the cases. The Committee retained as
counsel Pachulski Stang Ziehl & Jones LLP and Goosman Law Firm,
PLC, in Omaha, Nebraska.
SPECIALTY RETAIL: Delaware Trust Objects to Plan Confirmation
-------------------------------------------------------------
Delaware Trust Company files an objection to the confirmation of
the Second Amended Joint Chapter 11 Plan of Specialty Retails Shops
Holding Corp. and its Debtor Affiliates.
The Trustee complains that the Plan fails to mention the issuance
of the Notes and the Trustee's Claim, which constitute one of the
largest unsecured claims in the Debtors' cases. In doing so, the
Plan ignores contractual obligations to the Holders and the Trustee
under the Indenture.
According to Delaware, insofar as the Debtors propose to classify
the Trustee's individual claim as indenture trustee as part of the
Holders' general unsecured claim for payment of principal and
interest due under the Notes, the Debtors are violating terms of
the Indenture.
The Trustee points out, as a creditor with a contract claim for its
fees and expenses incurred in exercising its duties under the
Indenture should share in the recovery proposed under the Plan
(should it be confirmed) at the same pro rata level as every other
similarly situated claimant in the Debtors' cases.
Counsel to Delaware Trust Company, as Trustee:
Jeffrey N. Rothleder, Esq.
Christopher J. Giaimo, Esq.
Squire Patton Boggs (US) LLP
2550 M Street, NW
Washington, DC 20037
Telephone: 202-457-6000
Facsimile: 202-457-6315
Email: jeffrey.rothleder@squirepb.com
christopher.giaimo@squirepb.com
About Specialty Retail Shops
Specialty Retail Shops Holding Corp. and its affiliates are engaged
in the sale of general merchandise including clothing, accessories,
electronics, and home furnishings, as well as company-operated
pharmacy and optical services departments. They are headquartered
in Green Bay, Wisconsin, and operate 367 stores in 25 states
throughout the United States as well as e-commerce operations.
They currently employ approximately 14,000 people throughout the
United States.
Specialty Retail Shops Holding and its affiliates sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. D. Neb. Lead Case
No. 19-80064) on Jan. 16, 2019. At the time of the filing, the
Debtors estimated assets of $500 million to $1 billion and
liabilities of $1 billion to $10 billion.
The cases are assigned to Judge Thomas L. Saladino.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as general bankruptcy counsel; McGrath North
Mullin & Kratz, P.C. LLO as local counsel; Houlihan Lokey Capital,
Inc., as investment banker; Berkeley Research Group, LLC, as
restructuring advisor; Hilco Real Estate, LLC as real estate
consultant; Willkie Farr & Gallagher LLP as special counsel; Ducera
Partners LLC as financial advisor; and Prime Clerk LLC as notice
and claims agent.
A seven-member panel has been appointed as official unsecured
creditors committee in the cases. The Committee retained as
counsel Pachulski Stang Ziehl & Jones LLP and Goosman Law Firm,
PLC, in Omaha, Nebraska.
SUNEDISON INC: Shareholders to Proceed With Class Action
--------------------------------------------------------
Pursuant to Rule 23 of the Federal Rules of Civil Procedure and an
order of the United States District Court for the Southern District
of New York, all person and entities who purchased or otherwise
acquired shares of (a) SunEdison Inc. common stock between Sept. 2,
2015 and April 4, 2016; and (b) SunEdison Inc. preferred stock
between Aug. 18, 2015, and Nov. 18, 2015, has been certified to
proceed as a class action on behalf of the class consisting of two
distinct subclasses, except for certain person and entities who are
excluded from that class.
The full printed notice may be obtained from
https://www.SunEdisonSecuritiesLitigation.com or by contacting the
administrator by toll-free phone at 1-866-887-2962, by email at
info@SunEdisonSecuritiesLitigation.com or in writing at:
In re SunEdison Inc. Securities Litigation
c/o Analytic Consulting
P.O. Box 2007
Chanhassen, MN 55317-2007
Inquiries, other than requests for the notice, may be made to the
following representative of class counsel:
Adam Hollander, Esq.
Bernstein Litowitz Berger & Grossmann LLP
1251 Avenue of the America
New York, NY 10020
Tel: 1-800-830-8496
Email: adam.hollander@blbglaw.com
About SunEdison, Inc.
SunEdison, Inc. (OTC PINK: SUNEQ), is a developer and seller of
photovoltaic energy solutions, an owner and operator of clean power
generation assets, and a global leader in the development,
manufacture and sale of silicon wafers to the semiconductor
industry.
On April 21, 2016, SunEdison, Inc., and 25 of its affiliates each
filed a Chapter 11 bankruptcy petition (Bankr. S.D.N.Y. Case Nos.
16-10991 to 16-11017). Martin H. Truong, the senior vice
president, general counsel and secretary, signed the petitions.
The Debtors disclosed total assets of $20.7 billion and total debt
of $16.1 billion as of Sept. 30, 2015.
The Debtors have hired Skadden, Arps, Slate, Meagher & Flom LLP as
counsel, Togut, Segal & Segal LLP as conflicts counsel, Rothschild
Inc. as investment banker and financial advisor, McKinsey Recovery
& Transformation Services U.S., LLC, as restructuring advisors and
Prime Clerk LLC as claims and noticing agent. The Debtors employed
PricewaterhouseCoopers LLP as financial advisors; and KPMG LLP as
their auditor and tax consultant.
SunEdison also tapped Eversheds LLP as its special counsel for
Great Britain and the Middle East. Cohen & Gresser LLP has also
been retained as special counsel.
The Debtors tapped Ernst & Young LLP to provide tax-related
services. Keen-Summit Capital Partners LLC has been hired as real
estate advisor. Binswanger of Texas, Inc. also has been retained
as real estate agent.
Sullivan & Cromwell LLP serves as counsel to TerraForm Power, Inc.,
and TerraForm Global, Inc.
An official committee of unsecured creditors has been appointed in
the case. The Committee tapped Weil, Gotshal & Manges LLP as its
general bankruptcy counsel and Morrison & Foerster LLP as special
counsel. Togut, Segal & Segal LLP and Kobre & Kim LLP serve as
conflicts counsel. Alvarez & Marsal North America, LLC, serves as
the Committee's financial advisors.
Counsel to the administrative agent under the Debtors' prepetition
first lien credit agreement are Richard Levy, Esq., and Brad
Kotler, Esq., at Latham & Watkins.
Counsel to the administrative agent under the postpetition DIP
financing facility are Scott Greissman, Esq., and Elizabeth Feld,
Esq., at White & Case LLP.
Counsel to the Tranche B Lenders (as defined in the DIP credit
agreement) and the steering committee of the second lien creditors
are Arik Preis, Esq., and Naomi Moss, Esq., at Akin Gump Strauss
Hauer & Field, LLP.
Counsel to the administrative agent under the Debtors' prepetition
second lien credit agreement is Daniel S. Brown, Esq., at Pillsbury
Winthrop Shaw Pittman LLP.
The collateral trustee under the Debtors' prepetition second lien
credit agreement and the indenture trustee under each of the
Debtors' outstanding bond issuances, is represented by Marie C.
Pollio, Esq., at Shipman & Goodwin LLP.
Counsel to the ad hoc group of certain holders of the Debtors'
convertible senior notes is White & Case LLP's Tom Lauria, Esq.
* * *
On March 28, 2017, the Debtors filed their Plan of Reorganization
and related Disclosure Statement. The Disclosure Statement was
approved on June 13, 2017. Judge Stuart Bernstein subsequently
confirmed the Debtors' Second Amended Joint Plan of Reorganization
on July 28, 2017.
SWIFT STAFFING: July 23 Evidentiary Hearing on Plan Confirmation
----------------------------------------------------------------
Bankruptcy Judge Selene D. Maddox issued an order approving Swift
Staffing Holdings, LLC's disclosure statement. The approval is
subject to the amendments contained in the Court's prior Order
sustaining the Objection of Liberty Mutual Insurance Corporation
and incorporating that proponent's claims into the plan.
An evidentiary hearing on confirmation of the Chapter 11 Plan of
Reorganization will be held on July 23, 2019 at 10:00 AM.
Objections are due June 5. Ballots are also due June 5.
About Swift Staffing Holdings
Swift Staffing Holdings, LLC, is a full-service provider of
staffing services with offices across the United States.
Swift Staffing sought Chapter 11 protection (Bankr. N.D. Miss. Case
No. 18-10616) on Feb. 21, 2018. In the petition signed by Rodney
Clay Dial, manager, the Debtor estimated assets and liabilities in
the range of $1 million to $10 million. The case has been assigned
to Judge Jason D. Woodard. The Debtor tapped Craig M. Geno, Esq.,
at Law Offices of Craig M. Geno, PLLC, as counsel; and Jewel Bunch
as consultant.
On Feb. 27, 2018, the bankruptcy cases of Swift Staffing Arkansas,
LLC (Case No. 18-10626), Swift Staffing Alabama, LLC (Case No.
18-10627), Swift Staffing Georgia, LLC Case No. 18-10628), Swift
Staffing North Carolina, LLC (Case No. 18-10629), Swift Staffing
Florida, LLC (Case No. 18-10630), Swift Staffing Mississippi, LLC
(Case No. 18-10631), Swift Staffing Tennessee, LLC (Case No.
18-10632), Swift Staffing Pennsylvania, LLC (Case No. 18-10633),
and Rockhill Staffing Texas, LLC (Case No. 18-10634) were
administratively consolidated into the bankruptcy cases of Swift
Staffing Holdings, LLC (Case No. 18-10616).
TECHNICAL COMMUNICATIONS: Delays Q2 Quarterly Report for Review
---------------------------------------------------------------
Technical Communications Corporation filed a Form 12b-25 with the
U.S. Securities and Exchange Commission notifying the delay in the
filing of its quarterly report on Form 10-Q for the period ended
March 30, 2019.
Technical Communications said it was unable to file its Quarterly
Report on Form 10-Q for the quarter ended March 30, 2019 within the
prescribed time period without unreasonable effort or expense. The
Company requires additional time to finalize the financial
statements to be included as part of the Q2 2019 Form 10-Q. The
additional time is required for, but not limited to, the Company to
review its revenue recognition policies, including its historical
interpretations and application of ASC 605, Revenue Recognition.
Based upon this review, the Company has reached a preliminary
conclusion that the Company needs to modify certain aspects of its
revenue recognition policies and correct errors resulting from the
misapplication of such policies. Those modifications are likely to
result in the restatement of financial statements for select prior
periods, including the financial statements for prior periods
included in the Q2 2019 Form 10-Q. The Company's independent
registered public accounting firm also needs additional time to
complete its audit of the financial statements to be included in
the Company's Annual Report on Form 10-K for the fiscal year ended
Sept. 29, 2018 and its review of the Company's financial statements
to be included in its quarterly reports for its 2019 fiscal year.
The Company is unable to file its annual or quarterly reports until
such audit and reviews are completed.
Due to the ongoing accounting review by the Company and its
independent registered public accounting firm, the Company is
unable to quantify or provide a reasonable estimate of the changes
in revenue for prior periods until such review is complete.
About Technical Communications
Concord, Massachusetts-based Technical Communications Corporation
-- http://www.tccsecure.com/-- specializes in secure
communications systems and customized solutions to protect highly
sensitive voice, data and video transmitted over a wide range of
networks.
Technical Communications reported a net loss of $1.43 million for
the year ended Sept. 30, 2017, compared to a net loss of $2.47
million for the year ended Oct. 1, 2016. As of June 30, 2018, the
Company had $3.84 million in total assets, $481,543 in total
current liabilities and $3.36 million in total stockholders'
equity.
Moody, Famiglietti & Andronico, LLP, in Tewksbury, Mass., issued a
"going concern" opinion in its report on the consolidated financial
statements for the year ended Sept. 30, 2017, citing that the
Company has an accumulated deficit, has suffered significant net
losses and negative cash flows from operations and has limited
working capital that raise substantial doubt about its ability to
continue as a going concern.
TERRAVISTA PARTNERS: Unsecureds to be Paid from 2020 to 2025
------------------------------------------------------------
Terravista Partners - Hidden Village, Ltd., filed a Chapter 11 Plan
and accompanying disclosure statement.
Class 4: Creditors Holding Allowed Unsecured Claims - $43,000.
Terravista will, commencing in 2020 and continuing through 2025
(unless the Class 4 Claims are paid in full prior to 2025) and in
four equal installments each year (on March 15th, June 15th,
September 15th and December 15th), pay its Class 4 non-insider
Creditors their pro rata share of 50% of the difference of: (i) the
corporation's net taxable income after (after taxes but before the
depreciation deduction) according to the Revested Debtor's previous
year's form 1065 Federal Tax Return and (ii) the sum of all plan
payments and debt service payments (including principal payments)
made by Terravista. The remaining 50% of this amount shall be
utilized for future working capital needs. Such Class 4 Creditors
shall be paid in full under this provision.
Class 5: Equity Interest Holders shall, upon confirmation of the
Plan and upon their $500,000 capital contribution to Terravista,
retain their interest in Terravista. Furthermore, Creditors with
Allowed Claims that are deemed subordinated pursuant to Section
510(b) of the Bankruptcy Code shall not receive any distributions
under this Plan unless they purchase any equity interest pursuant
to the following paragraph. In the event that these Creditors
become equity holders, they will not receive any distributions
until all plan obligations are satisfied.
This Plan is feasible as a result of the fact that, based upon
historical operating data, the Debtor will have sufficient cash
available to pay the Creditors' Allowed Claims on the Initial
Distribution Date and subsequent distribution dates in accordance
with the provisions of the Plan.
A full-text copy of the Disclosure Statement dated May 2, 2019, is
available at https://tinyurl.com/y2yq6bm5 from PacerMonitor.com at
no charge.
About Terravista Partners
Terravista Partners - Hidden Village, Ltd. conducts business under
the names Hidden Village Apartments and Hidden Village Apartment
Homes. It is a real estate lessor headquartered in San Antonio,
Texas.
Terravista Partners filed a Chapter 11 petition (Bankr. W.D. Tex.
Case No. 18-52901) on Dec. 4, 2018. The petition was signed by
Philip W. Stewart, president of Terravista - Hidden Village
Corporation. At the time of the filing, the Debtor had estimated
assets and liabilities of between $1 million and $10 million. The
case has been assigned to Judge Craig A. Gargotta. The Debtor is
represented by the Law Offices of William B. Kingman, P.C.
Four affiliates Terravista Partners - Pecan Manor, Ltd., aka The
Villas of Pecan Manor (Case No. 19-51100), Terravista Partners -
Roselawn, Ltd., aka Roselawn Apartment (Case No. 19-51101),
Terravista Partners - Spanish Spur, Ltd., aka Spanish Spur
Apartments (Case No. 19-51104), and Terravista Partners - Westwood,
Ltd., aka Westwood Plaza Apartments (Case No. 19-51105) on May 6,
2019.
TESLA INC: S&P Affirms 'B-' ICR After Capital Raise; Outlook Neg.
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' issuer credit rating on Tesla
Inc. to reflect its improved liquidity after the company raised
over $2.7 billion through the issuance of about $860 million of
common stock and $1.84 billion in 2.00% convertible senior notes
due May 15, 2024.
S&P also assigned its 'B-' issue-level rating and '3' recovery
rating to the new 2.00% convertible senior notes.
The ratings affirmation reflects Tesla's improved liquidity, which,
in S&P's view, partially offsets the risk related to limited
profitability and cash outflows for the remainder of 2019 and
beyond.
The negative outlook reflects risks related to weaker than expected
demand, ongoing profitability challenges, and the lack of free cash
flow over the next 12-24 months. These factors, in addition to
persistently rising financial commitments, could make Tesla's
financial position unsustainable, according to S&P.
"We could lower the ratings if free cash flow is significantly
negative in 2019 and is unlikely to turn positive in 2020. This
would lead us to believe that Tesla's financial commitments are
unsustainable, especially in the face of intense global
competition, as most major automakers plan to launch battery
electric vehicles after 2020," S&P said.
"To revise the outlook to stable we would need to expect free cash
flow to approach breakeven over the next 12 months and that the
company is on a sustained path toward improving its credit metrics
through improved EBITDA," the rating agency said.
THAI LEMAR: Unsecured Creditors to Get 15% Under Plan
-----------------------------------------------------
Thai Lemar Inc. filed in connection with the Plan of Reorganization
and accompanying Disclosure Statement.
Class 2 Claims consist of: (a) the pre-petition unsecured claims
against the Debtor, to the extent Allowed, if any. The Class 2
Claims will be Satisfied via monthly payments starting the
Effective Date of the Plan. Total Class 2 Claims is estimated at
$57,378.40. The Distribution of class 2 claims is estimated in a
15.00% distribution on these claims. This Class is impaired.
Equity Security Holders (Class 3) consist of all equity security
holders owned by the corporation, if any. The Class 3 Claims will
receive no distribution under the plan. This Class is impaired will
not vote on the plan.
The Plan will be funded by and through: (a) the Debtor's cash
reserves as of the Effective Date of the Plan and (b) the future
cash flows generated by Debtors business.
A full-text copy of the Disclosure Statement dated May 2, 2019, is
available at
https://tinyurl.com/y52jwe6r from PacerMonitor.com at no charge.
About Thai Lemar Inc.
Thai Lemar, Inc., sought Chapter 11 protection (Bankr. D.P.R. Case
No. 18-07263) on Dec. 13, 2018, estimating less than $1 million in
both assets and liabilities. Jose M. Prieto Carballo, Esq., at JPC
Law Office, serves as counsel to the Debtor.
TPE INDUSTRIES: Plan Confirmation Hearing Set for June 4
--------------------------------------------------------
Bankruptcy Judge Jeffery A. Deller issued an order approving TPE
Industries, Inc.'s disclosure statement in support of its chapter
11 plan.
May 28, 2019 is fixed as the last day for serving written
acceptances or rejections of the plan, and the last day for filing
and serving written objections to the confirmation of the plan.
June 4, 2019 at 10:00 AM in Courtroom D, 54th Floor, U.S. Steel
Tower, 600 Grant Street, Pittsburgh PA 15219 is the date and time
fixed for hearing on confirmation of the plan.
The Troubled Company Reporter previously reported that quarterly
payments will be distributed to general unsecured creditors in the
total amount of approximately $59,000 for three years.
A full-text copy of the Disclosure Statement dated March 20, 2019,
is available at http://tinyurl.com/y5nnehfgfrom PacerMonitor.com
at no charge.
About TPE Industries Inc.
TPE Industries, Inc. -- http://www.tpelectric.net/-- is a family
owned and operated company that provides engineering, design,
installation, construction and commissioning services. TPE
Industries operates three separate operating divisions as follows:
TP Electric, Inc. (natural gas and oil division); TP Electric &
Power, LLC (industrial and commercial division) and TP Automation,
LLC (industrial automation, PLC's, instrumentation, gas and flame
detection). The companies serve a wide range of clients and
industries that include natural gas and oil, hi-tech manufacturing,
water treatment facilities, wireless communications, chemical
manufacturing, power generation, power transmission,
telecommunications, metals manufacturing and mining & aggregate.
TPE Industries' main office is in Acme, Pennsylvania.
TPE Industries, Inc. and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case Nos.
18-23447 to 18-23450) on Aug. 30, 2018. The cases are jointly
administered, with TPE Industries as the lead case.
In the petitions signed by Shawn T. Porter, president, the Debtors
disclosed these assets and liabilities:
Total Total
Assets Liabilities
----------- -----------
TPE Industries, Inc. $407,717 $339,387
T.P. Electric, Inc. $2,393,042 $4,903,125
TP Automation, LLC $219,970 $54,320
Judge Jeffery A. Deller presides over the case.
Kirk B. Burkley, Esq., at Bernstein-Burkley, P.C., is the Debtor's
legal counsel.
No official committee of unsecured creditors has been appointed in
the Chapter 11 cases.
U & J CAFE: Selling 1981 Chevrolet P30 Step Van for $25K
--------------------------------------------------------
U & J Cafe, LLC, doing business as Mortar & Pestle, doing business
as Mortar & Pestle Cafe, asks the U.S. Bankruptcy Court for the
Middle District of Florida to authorize the sale of a 1981
Chevrolet P30 Step Van, VIN 1GCJP32W6B3316233, for $25,000.
Synovus Bank filed a proof of claim (Claim #7) in the amount of
$43,761 secured by the Debtor's Van. There are no known liens on
the Van other than the lien of Synovus. Synovus has agreed to
release its lien on the Van for the sum of $35,000. It has also
agreed to release the Debtor's principals' guarantees of the
Synovus Debt upon receipt of the $35,000.
Recently, the Debtor received an offer from the Purchaser to
acquire the Van for the sum of $25,000. Since the Purchaser's
offer is less than $35,000, the Debtor's principals have agreed to
tender the $10,000 shortfall to Synovus from their own personal
funds. The Debtor has already tendered $35,000 ($25,000 from the
Purchaser and $10,000 from the Debtor's principals) to Synovus for
payment on the Synovus Debt.
The proposed sale of the Van is not in the ordinary course of
business. It is on fair and equitable terms and is in the best
interest of the bankruptcy estate and its creditors.
The Debtor requests that the 14-day stay required under Bankruptcy
Rule §6004(h) be waived, and that any order granting the Motion is
effective immediately upon entry.
About U & J Cafe
Based in Tampa, Florida, U & J Cafe, LLC, d/b/a Mortar & Pestle,
d/b/a Mortar & Pestle Cafe, a restaurant operator, filed a
voluntary Chapter 11 Petition (Bankr. M.D. Fla. Case No. 18-04940)
on June 14, 2018. It is an affiliate of U & J Realty, LLC, which
sought bankruptcy protection on June 1, 2018 (Bankr. M.D. Fla. Case
No. 18-04591).
In the petition signed by Ujwal Patel, manager, the Debtor
disclosed total assets of $119,910 and total liabilities of $2.06
million as of the bankruptcy filing.
The Debtor is represented by Buddy D Ford, Esq., at Buddy D. Ford,
P.A., in Tampa, Florida.
VBAR 3 LLC: Seeks to Hire Tarter Krinsky as Counsel
---------------------------------------------------
Vbar 3, LLC, 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 previously hired Richard Byron Peddie, as counsel.
Vbar 3, LLC 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 at 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 Vbar 3, LLC
Vbar 3, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
S.D.N.Y. Case No. 19-10378) on Feb. 10, 2019, estimating under $1
million in assets and liabilities. Tarter Krinsky & Drogin LLP,
which substituted for Richard Byron Peddie, P.C., is the Debtor's
counsel.
VERDESIAN LIFE: S&P Cuts ICR to CCC- on Increased Refinancing Risk
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Cary,
N.C.-based agricultural crop nutrient supplier Verdesian Life
Sciences LLC to 'CCC-' from 'CCC+'.
S&P also lowered the issue-level rating on the company's senior
secured credit facility to 'CCC-' from 'B-' and revised the
recovery rating to '3' from '2' to reflect the lower issuer credit
rating and weakened recovery prospects.
"The downgrade reflects weakened operating performance through
December 2018, which led to credit measures falling well below our
expectations, and our belief that these credit measures are
unsustainable. The company has dealt with unfavorable market
conditions, including customer inventory destocking, wet winter and
spring weather, and supply constraints on select raw materials,
namely granulated peat," S&P said.
In addition to the weakened operating performance and limited
diversity of the company, Verdesian's revolver due date looms in
July 2019, according to the rating agency.
"We believe this maturity poses a high near-term refinancing risk,
particularly given the company is reliant on the revolver and
typically carries minimal cash balances. However, the cost savings
initiatives that the company implemented in 2018 should have a
favorable impact on 2019 EBITDA, but it must address the
refinancing within the next two months to avoid an otherwise highly
likely default," S&P said.
Verdesian competes in small niche segments of the overall
agriculture industry, which historically has seen good
profitability and limited penetration. In addition, if larger and
stronger-capitalized companies more forcefully compete in these
niche spaces over the longer term, the company could face
additional pricing and distribution challenges. Verdesian is small
in overall size and scale and has a narrow product focus, producing
mostly additives that supplement nitrogen and phosphorus
fertilizers. It has high customer concentration and sells its
specialized products to distributors that carry great influence
over large crop growers' purchasing decision. Verdesian is
vulnerable to general downturns in its agricultural markets, which
was quite evident when EBITDA dropped significantly. The company's
fertilizer additives are a discretionary expense rather than a
necessity, and as such could be the first to go when farm incomes
decrease.
"The negative outlook reflects our expectation that Verdesian faces
significant refinancing risk within the next few months and that
credit metrics in 2018 and 2019 will be materially weaker than we
previously forecasted, and at unsustainable levels," S&P said.
Unless the company can successfully refinance its revolver and
existing bank loan, it will continue to have liquidity restraints
given low cash balances and covenant restrictions on its existing
revolver, and faces the possibility of a default or a distressed
exchange, according to the rating agency.
"We could consider a downgrade in the next few months if the
company does not successfully refinance its revolver. In addition,
if weakened operating performance as the result of ongoing supply
constraints with key raw materials, competition from alternative
products, or weather-related issues continue, or management chooses
to adopt more aggressive financial policies, we could take a
negative rating action," S&P said.
"We could consider an upgrade within the next few months if the
company successfully refinances its revolver and we believe it will
improve operating performance from depressed 2018 levels," the
rating agency said.
VESTA ENERGY: S&P Lowers Senior Unsecured Debt Rating to 'B-'
-------------------------------------------------------------
S&P Global Ratings said it lowered its issue-level rating on
Alberta-based Vesta Energy Corp.'s senior unsecured notes to 'B-'
from 'B' and revised its recovery rating on the notes to '4' from
'2'. The downgrade reflects the increase to the company's revolving
credit facility limit to C$325 million from C$300 million and the
decrease in S&P's PV-10 valuation assessment. The latter is due to
the incorporation of a US$10 per barrel discount between the West
Texas Intermediate and Canadian light oil and updated Canada-U.S
exchange rate of C$1.27 in the long term for S&P's recovery
analysis.
"Our 'B-' issuer credit rating on Vesta is unchanged because the
increase on the credit facility limit is leverage-neutral for the
company," S&P said. "The negative outlook reflects our view that
Vesta's credit risk has increased due to a lower-than-expected
production growth profile in 2019 and the company's credit metrics'
high sensitivity to changes in hydrocarbon price assumptions due to
the company's small scale and lack of operational and geographic
diversification."
ISSUE RATINGS -- RECOVERY ANALYSIS
Key analytical factors
-- S&P has lowered its recovery rating to '4' from '2' and
issue-level rating to 'B-' from 'B' on Vesta's senior unsecured
notes.
-- S&P has valued the company on a going-concern basis. The
recovery analysis is based on an enterprise value at Dec. 31, 2018,
under the PV-10 valuation approach.
-- S&P caps the value of proved undeveloped reserves at 25% of the
total proved reserves value.
-- S&P's default scenario contemplates a significant deterioration
in oil and gas prices that limits the company's ability to fund its
fixed charges and exhausts available liquidity.
-- The recovery rating has a very high sensitivity to changes in
debt and proved reserves because of Vesta's current small reserve
base, which could result in rapid changes in the recovery rating.
Simulated default assumptions:
Simulated year of default: 2021
Simplified waterfall:
-- Net enterprise value (after 5% administrative costs): US$330
million
-- Valuation split in % (obligors/non-obligors): 100/0
-- Secured first-lien debt: US$260 million
-- Recovery expectations: Not applicable
-- Senior unsecured debt and pari passu claims: US$165 million
-- Recovery expectations: 30%-50% (40% rounded)
All debt amounts include six months of prepetition interest.
Ratings List
Downgraded; Recovery Rating Revised
To From
Vesta Energy Corp.
Senior Unsecured B- B
Recovery Rating 4(40%) 2(85%)
VORAS ENTERPRISE: Court Approves Disclosures, Confirms Ch. 11 Plan
------------------------------------------------------------------
The Bankruptcy Court has approved the Disclosure Statement of Voras
Enterprise Inc., aka Voras Enterprises Inc., and confirmed its
Chapter 11 Plan.
The Plan and each of its provisions be, and are, confirmed in each
and every respect pursuant to section 1129 of the Bankruptcy Code.
Any objections, reservations of rights, statements, or joinders
regarding Confirmation were resolved or are overruled.
The terms of the Plan shall solely govern the classification of
Claims for purposes of the Distributions to be made thereunder.
The Debtor shall pay all United States Trustee quarterly fees under
28 U.S.C. Section 1930(a)(6), plus interest due and payable under
31 U.S.C. Section 3717 on all disbursements, including Plan
payments and disbursements in and outside the ordinary course of
the Debtor’s business, until the entry of a Final Order or
dismissal of the Chapter 11 Case.
The Debtor shall file quarterly Post Confirmation Reports and
schedule quarterly post-confirmation status conferences with the
Court.
Within fourteen (14) days following the full administration of the
estate, the Debtor shall file, on notice to the U.S. Trustee, an
application and a proposed order for a final decree pursuant to
Bankruptcy Rule 3022.
The Debtor shall file and serve upon the U.S. Trustee a closing
report within sixty (60) days following substantial consummation of
the Plan.
About Voras Enterprise
Voras Enterprise Inc., a/k/a Voras Enterprises Inc., is a
nonprofit, tax-exempt corporation that provides community housing
development services within the Brooklyn, New York area.
The Debtor filed for Chapter 11 bankruptcy protection (Bankr.
E.D.N.Y. Case No. 17-45570) on Oct. 26, 2017. In the petition
signed by Jeffrey E. Dunston, president and CEO, the Debtor
estimated its assets and liabilities at between $1 million and $10
million. Judge Nancy Hershey Lord presides over the case. The
Debtor tapped DiConza Traurig Kadish LLP as legal counsel, and
Keen-Summit Capital Partners, LLC, as its real estate advisor.
WEINSTEIN COMPANY: Hires Bernstein Litowitz as Special Counsel
--------------------------------------------------------------
The Weinstein Company Holdings LLC, and its debtor-affiliates seek
authority from the U.S. Bankruptcy Court for the District of
Delaware to employ Bernstein Litowitz Berger & Grossmann, LLP, as
special litigation counsel to the Debtors.
Weinstein Company requires Bernstein Litowitz to:
(a) advise the Debtors with respect to the viability of the
certain claims the Debtors may have against the Former
Directors and Officers, and if so requested, representing
the Debtors or any successor in interest in connection
with the such claims; and
(b) interact and coordinate with the Debtors' other
professionals and personnel in furtherance of the certain
claims the Debtors may have against the Former Directors
and Officers.
Bernstein Litowitz will be paid on a contingency basis as follows:
a. 25% of the monetary recovery achieved for the Debtors from
the date of execution of this agreement to the date of 6
months following the firm providing notice to the
Defendants of intent to mediate or arbitrate, whichever
comes earlier; and
b. 30% of any monetary recovery if a settlement is reached or
judgment obtained.
Bernstein Litowitz will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Mark Lebovitch, partner of Bernstein Litowitz Berger & Grossmann,
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 Debtors and their
estates.
Bernstein Litowitz can be reached at:
Mark Lebovitch, Esq.
BERNSTEIN LITOWITZ BERGER & GROSSMANN, LLP
1285 Avenue of the Americas, 38th Floor
New York, NY 10019
Tel: (212) 554-1400
Fax: (212) 554-1444
About The Weinstein Company Holdings
The Weinstein Company Holdings LLC and 54 affiliates sought Chapter
11 protection (Bankr. D. Del. Lead Case No. 18-10601) on March 19,
2018 after reaching a deal to sell all assets to Lantern Asset
Management for $310 million.
The Weinstein Company Holdings estimated $500 million to $1 billion
in assets and $500 million to $1 billion in liabilities.
The Hon. Mary F. Walrath is the case judge.
Cravath, Swaine & Moore LLP is the Debtors' bankruptcy counsel,
with the engagement led by Paul H. Zumbro, George E. Zobitz, and
Karin A. DeMasi, in New York.
Richards, Layton & Finger, P.A., is the local counsel, with the
engagement headed by Mark D. Collins, Paul N. Heath, Zachary I.
Shapiro, Brett M. Haywood, and David T. Queroli, in Wilmington,
Delaware. Bernstein Litowitz Berger & Grossmann, LLP, as special
litigation counsel.
The Debtors also tapped FTI Consulting, Inc., as restructuring
advisor; Moelis & Company LLC as investment banker; and Epiq
Bankruptcy Solutions, LLC as claims and noticing agent.
The Office of the U.S. Trustee for Region 3 appointed an official
committee of unsecured creditors on March 28, 2018. The committee
retained Pachulski Stang Ziehl & Jones, LLP as its legal counsel,
and Berkeley Research Group, LLC as its financial advisor.
WILSON LAND: Jacob Poyar Buying Painesville Property for $260K
--------------------------------------------------------------
Wilson Land Properties, LLC, asks the U.S. Bankruptcy Court for the
Northern District of Ohio to authorize the sale of interest in the
real property located at 523 Mentor Ave. 521, Painesville, Ohio,
Parcel # 15C0160000030, to Jacob Poyar Properties, LLC, for
$260,000.
There are encumbrances on the property as indicated from the
Commitment. The parties believe the sale price represents fair
market value for the property.
There are interests in the real estate as set forth in the attached
Commitment but it is in the best interest of the estate that the
property be sold free and clear of their interests. Those
interests as set forth in the Commitment.
The real estate commission of $3,400 should be paid 100% to Century
21 HomeStar, 31005 Bainbridge Rd. Suite 5, Solon Ohio. The gross
purchase price is $110,000. The Debtor is paying $0 towards the
Buyer's closing cost, points and or pre-paid.
In order to provide adequate protection of any interests of those
parties, the Buyer will deposit the funds necessary to complete the
transaction with the escrow agent as set forth in Exhibit A, the
Debtor will instruct the escrow agent to disperse from the sale
proceeds in an amount sufficient to pay real estate taxes, and any
amounts owed to Tax Ease Ohio in full and then the balance to RBS
Citizens NA.
The Debtor asks that the Court authorizes the sale of the real
estate, to the proposed Purchaser on the terms and conditions as
set forth.
A copy of the Offer and the Commitment attached to the Motion is
available for free at:
http://bankrupt.com/misc/Wilson_Land_126_Sales.pdf
About Wilson Land Properties
Based in Mentor, Ohio, Wilson Land Properties, LLC, is the owner of
51 real estate properties having a total estimated value of $4.54
million. Wilson Land Properties, based in Mentor, OH, filed a
Chapter 11 petition (Bankr. N.D. Ohio Case No. 18-10514) on Jan.
31, 2018. In the petition signed by Richard M Osborne, managing
member, the Debtor disclosed $4.54 million in assets and $43.23
million in liabilities. The Hon. Arthur I. Harris oversees the
case. Glenn E. Forbes, Esq., at Forbes Law LLC, serves as
bankruptcy counsel to the Debtor.
WINDSTREAM HOLDINGS: Committee Taps Alix as Financial Advisor
-------------------------------------------------------------
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 AlixPartners, LLP as its
financial advisor.
The firm will provide these services to the committee in the
Chapter 11 cases of Windstream and its affiliates:
(a) review and evaluate the Debtors' current financial
condition, business plans and financial forecasts, and periodically
report to the committee;
(b) review the Debtors' cash management, tax sharing and
intercompany accounting systems, practices and procedures;
(c) review and investigate related party transactions,
including those between the Debtors and non-debtor subsidiaries and
affiliates, and other pre-bankruptcy transactions;
(d) identify and review potential preference payments,
fraudulent conveyances and other causes of action that the Debtors'
estates may hold against third parties;
(e) analyze the Debtors' assets and claims, and assess
potential recoveries to the various creditor constituencies under
different scenarios;
(f) support the committee's investment banker's evaluation of
proposed asset sales, as required;
(g) assist in the development or review of the Debtors' plan
of reorganization and disclosure statement;
(h) review and evaluate court motions filed or to be filed by
the Debtors or any other parties-in-interest, as appropriate.
(i) render expert testimony and litigation support services,
including e-discovery services; and
(j) attend committee meetings and court hearings.
The firm's hourly rates are:
Managing Director $990 – $1,165
Director $775 – $945
Senior Vice President $615 – $725
Vice President $440 – $600
Consultant $160 – $435
Paraprofessional $285 – $305
David MacGreevey, managing director of AlixPartners, 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:
David MacGreevey
AlixPartners, LLP
909 Third Avenue, Floor 30
New York, NY 10022
Phone: +1 (212) 561-4187
Email: dmacgreevey@alixpartners.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 Katten Muchin as Conflicts Counsel
------------------------------------------------------------
Windstream Holdings, Inc. received approval from the U.S.
Bankruptcy Court for the Southern District of New York to hire
Katten Muchin Rosenman LLP as its conflicts counsel.
The firm will provide legal services in circumstances where
Kirkland & Ellis cannot handle the matter because of an actual or
perceived conflict of interest.
The firm's hourly rates are:
Partners $720 - $1,430
Of Counsel $850 - $1,405
Associates $395 - $930
Paraprofessionals $185 - $545
Steven Reisman, Esq., a partner at Katten Muchin, 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.
Reisman disclosed that his firm has not agreed to a variation of
its standard billing arrangements for its employment with the
Debtors, and that no Katten Muchin professional has varied his rate
based on the geographic location of the Debtors' bankruptcy cases.
The attorney also disclosed that the firm has not represented the
Debtors in the 12-month period prior to the petition date.
The Debtors have already approved the firm's budget and staffing
plan for the period Feb. 25 to June 25, 2019, according to Mr.
Reisman.
Katten Muchin can be reached through:
Steven J. Reisman, Esq.
Cindi M. Giglio, Esq.
Katten Muchin Rosenman LLP
575 Madison Avenue
New York, NY 10022
Telephone: (212) 940-8800 / (212) 940-8700
Facsimile: (212) 940-8776
Email: sreisman@kattenlaw.com
cindi.giglio@kattenlaw.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.
WMC MORTGAGE: Seek to Hire Alvarez & Marsal as Financial Advisor
----------------------------------------------------------------
WMC Mortgage, LLC, and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the District of Delaware to employ
Alvarez & Marsal Disputes and Investigations, LLC, as financial
advisor to the Debtors.
WMC Mortgage requires Alvarez & Marsal to:
(a) assist with preparing financial reports;
(b) assist with analyzing and investigating claims and causes
of action;
(c) prepare and review plan distribution models;
(d) when necessary, attend hearings before the Court and
Provide testimony at any such hearings;
(e) when necessary, attend and participate in meetings with,
among others, counsel, the board of directors of the
Debtors, the Special Committee, the Debtor's management,
any official statutory committees in the chapter 11 case
and any other parties in interest in the chapter 11 case;
and
(f) provide any other assistance that falls within Alvarez &
Marsal's expertise as agreed to by the Debtor and Alvarez
& Marsal.
Alvarez & Marsal will be paid at these hourly rates:
Managing Directors $650 to $1,050
Senior Directors/Directors $550 to $800
Analysts/Associates $350 to $625
Alvarez & Marsal received $300,000 as a retainer in connection with
preparing for and conducting the filing of the chapter 11 case. In
the 90 days prior to the Commencement Date, Alvarez & Marsal
received retainers and payments totaling $1,643,821. Alvarez &
Marsal has applied these funds to amounts due for services rendered
and expenses incurred prior to the Commencement Date. The
unapplied residual retainer of $111,000 will not be segregated by
the firm in a separate account, and will be held by the firm as an
evergreen retainer until the end of the chapter 11 case and applied
to its finally approved fees in these proceedings.
Alvarez & Marsal will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Laureen M. Ryan, a partner of Alvarez & Marsal, 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 Debtors and their estates.
Alvarez & Marsal can be reached at:
Laureen M. Ryan
ALVAREZ & MARSAL DISPUTES AND INVESTIGATIONS, LLC
600 Madison Avenue, 8th Floor
New York, NY 10022
Tel: (212) 759-4433
Fax: (212) 759-5532
About WMC Mortgage
WMC Mortgage, LLC, directly and through various predecessors, was
in the business of originating residential mortgage loans for more
than 60 years.
The collapse of the housing and financial markets presaging the
Great Recession decimated WMC's loan origination business. By the
second quarter of 2007, WMC had essentially stopped originating new
loans and focused on winding down its operations and resolving
substantial liabilities associated with its mortgage business.
Over the past decade, WMC has been able to settle the gravamen of
the litigation commenced against it, which primarily consisted of
contract actions for breaches of representations and warranties WMC
made in mortgage loan sale agreements relative to the attributes of
the loans sold.
WMC sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Case No. 19-10879) on April 23, 2019. At the time
of the filing, WMC estimated assets of between $1 million and $10
million and liabilities of between $100 million and $500 million.
The case has been assigned to Judge Christopher S. Sontchi.
WMC tapped Richards, Layton & Finger, P.A., as its bankruptcy
counsel; Jenner & Block LLP as special litigation counsel; Alvarez
& Marsal Disputes and Investigations, LLC, as financial advisor;
and Epiq Corporate Restructuring, LLC as claims and noticing agent.
WMC MORTGAGE: Seek to Hire Epiq as Administrative Advisor
---------------------------------------------------------
WMC Mortgage, LLC, and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the District of Delaware to employ
Epiq Corporate Restructuring, LLC, as administrative advisor to the
Debtors.
WMC Mortgage requires Epiq to:
(a) assist with, among other things, solicitation, balloting,
tabulation, and calculation of votes, as well as preparing
any appropriate reports, as required in furtherance of
confirmation of plans of reorganization;
(b) generate an official ballot certification and testify, if
necessary, in support of the ballot tabulation results;
(c) gather data in conjunction with the preparation, and
assist with the preparation, of the Debtors' schedules of
assets and liabilities and statements of financial
affairs, if any;
(d) maintain an electronic filing platform for purposes of
filing proofs of claim;
(e) generate, provide and assist, if necessary, with claims
reports, claims objections, exhibits, claims
reconciliation, and related matters; and
(f) provide such other claims processing, noticing,
solicitation, balloting, distributions, and other
administrative services described in the Services
Agreement, but not included in the Section 156(c)
Application, as may be requested from time to time by the
Debtors, the Court, or the clerk of the Court.
Epiq will be paid based upon its normal and usual hourly billing
rates. Epiq will be paid a retainer in the amount of $25,000.
Epiq will also be reimbursed for reasonable out-of-pocket expenses
incurred.
Emily Young, senior consultant of Epiq Corporate Restructuring,
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 Debtors and their
estates.
Epiq can be reached at:
Emily Young
EPIQ CORPORATE RESTRUCTURING, LLC
777 Third Ave., 12th Floor
New York, NY 10017
Tel: (646)282-2595
About WMC Mortgage
WMC Mortgage, LLC, directly and through various predecessors, was
in the business of originating residential mortgage loans for more
than 60 years.
The collapse of the housing and financial markets presaging the
Great Recession decimated WMC's loan origination business. By the
second quarter of 2007, WMC had essentially stopped originating new
loans and focused on winding down its operations and resolving
substantial liabilities associated with its mortgage business.
Over the past decade, WMC has been able to settle the gravamen of
the litigation commenced against it, which primarily consisted of
contract actions for breaches of representations and warranties WMC
made in mortgage loan sale agreements relative to the attributes of
the loans sold.
WMC sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Case No. 19-10879) on April 23, 2019. At the time
of the filing, WMC estimated assets of between $1 million and $10
million and liabilities of between $100 million and $500 million.
The case is assigned to Judge Christopher S. Sontchi.
WMC tapped Richards, Layton & Finger, P.A. as its bankruptcy
counsel; Jenner & Block LLP as special litigation counsel; Alvarez
& Marsal Disputes and Investigations, LLC as financial advisor; and
Epiq Corporate Restructuring, LLC as claims and noticing agent.
WMC MORTGAGE: Seek to Hire Jenner & Block as Co-Counsel
-------------------------------------------------------
WMC Mortgage, LLC, and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the District of Delaware to employ
Jenner & Block LLP, as special counsel to the Debtors.
WMC Mortgage requires Jenner & Block to:
a. represent the Debtor in the litigation and investigation
matters, including but not limited to the investigation,
evaluation and defense of claims arising from the Debtor's
residential mortgage loan origination business; and
b. consult and advise the Debtor and Richards Layton & Finger,
P.A., the Debtor's proposed bankruptcy counsel, with regard
to the matters on which Jenner is representing the Debtor
to the extent those matters impact the Debtor's efforts to
formulate a chapter 11 plan and accompanying disclosure
statement.
Jenner & Block will be paid at these hourly rates:
Partners $778 to $1,020
Associates $412 to $735
Paralegals $298
Beginning in June 2015, Jenner & Block has received advance payment
retainers from the Debtors which have been regularly replenished,
on March 12, 2019 in the amount of $360,465, March 27, 2019 of
$100,000, and April 17, 2019 of $352,270. Prior to the
Commencement Date, the firm applied its retainer in satisfaction of
the fees and expenses incurred. After that application of the
retainer, the firm held and still holds $196,672 in retainer.
Jenner & Block will also be reimbursed for reasonable out-of-pocket
expenses incurred.
Megan B. Poetzel, a partner at Jenner & Block, 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 Debtors and their estates.
Jenner & Block can be reached at:
Megan B. Poetzel, Esq.
JENNER & BLOCK LLP
53 North Clark Street,
Chicago, IL 60654
Tel: (312) 222-9350
Fax: (312) 527-0484
About WMC Mortgage
WMC Mortgage, LLC, directly and through various predecessors, was
in the business of originating residential mortgage loans for more
than 60 years.
The collapse of the housing and financial markets presaging the
Great Recession decimated WMC's loan origination business. By the
second quarter of 2007, WMC had essentially stopped originating new
loans and focused on winding down its operations and resolving
substantial liabilities associated with its mortgage business.
Over the past decade, WMC has been able to settle the gravamen of
the litigation commenced against it, which primarily consisted of
contract actions for breaches of representations and warranties WMC
made in mortgage loan sale agreements relative to the attributes of
the loans sold.
WMC sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Case No. 19-10879) on April 23, 2019. At the time
of the filing, WMC estimated assets of between $1 million and $10
million and liabilities of between $100 million and $500 million.
The case is assigned to Judge Christopher S. Sontchi.
WMC tapped Richards, Layton & Finger, P.A. as its bankruptcy
counsel; Jenner & Block LLP as special litigation counsel; Alvarez
& Marsal Disputes and Investigations, LLC as financial advisor; and
Epiq Corporate Restructuring, LLC as claims and noticing agent.
WMC MORTGAGE: Seek to Hire Richards Layton as Counsel
-----------------------------------------------------
WMC Mortgage, LLC, and its debtor-affiliates seek authority from
the U.S. Bankruptcy Court for the District of Delaware to employ
Richards Layton & Finger, P.A., as counsel to the Debtors.
WMC Mortgage requires Richards Layton to:
a) investigate, analyze and assess the merits of potential
claims and causes of action the Debtor may have against
other parties, including the Debtor's affiliates, and
potentially prosecute one or more of such claims and causes
of action to settlement or judgment;
b) advise the Debtors of their rights, powers, and duties as
debtors and debtors in possession under chapter 11 of the
Bankruptcy Code;
c) take all necessary actions to protect and preserve the
estates of the Debtors, including the prosecution of
actions on the Debtors' behalf, the defense of any actions
commenced against the Debtors, the negotiation of disputes
in which the Debtors are involved, and the preparation of
objections to claims filed against the Debtors' estates;
d) assist in preparing on behalf of the Debtors all motions,
applications, answers, orders, reports, and papers in
connection with the administration of the Debtors' estates;
e) prepare the Debtors' Chapter 11 plan;
f) assist in preparing a disclosure statement and any related
documents and pleadings necessary to solicit votes on any
plan of reorganization proposed by the Debtors;
g) prosecute on behalf of the Debtors any proposed plan and
seeking approval of all transactions contemplated therein
and in any amendments thereto; and
h) perform all other necessary legal services in connection
with the prosecution of these chapter 11 cases.
Richards Layton will be paid at these hourly rates:
Directors $700 to $975
Counsel $635 to $650
Associates $350 to $600
Paraprofessionals $265
Prior to the Commencement Date, on April 22, 2019, Richards Layton
drew down the entirety of the Retainer balance of $585,640 in
satisfaction of fees and expenses actually incurred and anticipated
to be incurred through the Commencement Date.
In the one year prior to the Commencement Date, the Debtor paid
Richards Layton the amount of $7,295,410 as retainer.
Richards Layton will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Russell C. Silberglied, a partner at Richards Layton & Finger,
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.
Richards Layton can be reached at:
Russell C. Silberglied, Esq.
Mark D. Collins, Esq.
Paul N. Heath, Esq.
Zachary I. Shapiro, Esq.
Brendan J. Schlauch, Esq.
Travis J. Cuomo, Esq.
RICHARDS, LAYTON & FINGER, P.A.
920 North King Street
Wilmington, DE 19801
Tel: (302) 651-7700
Fax: (302) 651-7701
Email: collins@rlf.com
silberglied@rlf.com
heath@rlf.com
shapiro@rlf.com
schlauch@rlf.com
cuomo@rlf.com
About WMC Mortgage
WMC Mortgage, LLC, directly and through various predecessors, was
in the business of originating residential mortgage loans for more
than 60 years.
The collapse of the housing and financial markets presaging the
Great Recession decimated WMC's loan origination business. By the
second quarter of 2007, WMC had essentially stopped originating new
loans and focused on winding down its operations and resolving
substantial liabilities associated with its mortgage business.
Over the past decade, WMC has been able to settle the gravamen of
the litigation commenced against it, which primarily consisted of
contract actions for breaches of representations and warranties WMC
made in mortgage loan sale agreements relative to the attributes of
the loans sold.
WMC sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. D. Del. Case No. 19-10879) on April 23, 2019. At the time
of the filing, WMC estimated assets of between $1 million and $10
million and liabilities of between $100 million and $500 million.
The case is assigned to Judge Christopher S. Sontchi.
WMC tapped Richards, Layton & Finger, P.A., as its bankruptcy
counsel; Jenner & Block LLP as special litigation counsel; Alvarez
& Marsal Disputes and Investigations, LLC as financial advisor; and
Epiq Corporate Restructuring, LLC as claims and noticing agent.
[^] Recent Small-Dollar & Individual Chapter 11 Filings
-------------------------------------------------------
In re Office Express Inc.
Bankr. N.D. Ill. Case No. 19-13299
Chapter 11 Petition filed May 8, 2019
See http://bankrupt.com/misc/ilnb19-13299.pdf
represented by: Ben L. Schneider, Esq.
SCHNEIDER & STONE
E-mail: ben@windycitylawgroup.com
In re Geist Sports Academy, LLC
Bankr. S.D. Ind. Case No. 19-03303
Chapter 11 Petition filed May 8, 2019
See http://bankrupt.com/misc/insb19-03303.pdf
represented by: Eric C. Redman, Esq.
REDMAN LUDWIG PC
E-mail: eredman@redmanludwig.com
In re Joseph R. Mullins
Bankr. D. Mass. Case No. 19-11574
Chapter 11 Petition filed May 8, 2019
represented by: Harold B. Murphy, Esq.
MURPHY & KING, P.C.
E-mail: bankruptcy@murphyking.com
In re Carroll Realty, LLC
Bankr. D. Md. Case No. 19-16304
Chapter 11 Petition filed May 9, 2019
See http://bankrupt.com/misc/mdb19-16304.pdf
represented by: Bruce E. Gardner, Esq.
THE GARDNER LAW FIRM, P.C.
E-mail: beegard@gmail.com
In re 77th Street 8634 Group Inc.
Bankr. E.D.N.Y. Case No. 19-42838
Chapter 11 Petition filed May 8, 2019
Filed Pro Se
In re Larisa Lundin
Bankr. E.D.N.Y. Case No. 19-42875
Chapter 11 Petition filed May 8, 2019
represented by: Alla Kachan, Esq.
E-mail: alla@kachanlaw.com
In re Iglesia Mission C. Restauracion
Bankr. E.D.N.Y. Case No. 19-73359
Chapter 11 Petition filed May 8, 2019
See http://bankrupt.com/misc/nyeb19-73359.pdf
represented by: Michael J. Oziel, Esq.
MICHAEL J. OZIEL, P.C.
E-mail: oziellaw@optonline.net
In re Montgomery County Voiture No. 34
La Societe des 40 Hommes et 8 Chevaux
Bankr. S.D. Ohio Case No. 19-31489
Chapter 11 Petition filed May 7, 2019
See http://bankrupt.com/misc/ohsb19-31489.pdf
represented by: Charles J. Simpson, Esq.
E-mail: cjslpa@aol.com
In re Victor J. Moreno
Bankr. W.D. Tex. Case No. 19-51139
Chapter 11 Petition filed May 8, 2019
represented by: Dean William Greer, Esq.
E-mail: dwgreer@sbcglobal.net
In re Maria Del Consuelo Vazquez
Bankr. C.D. Calif. Case No. 19-15426
Chapter 11 Petition filed May 9, 2019
Filed Pro Se
In re Thomas Michael Dlugolecki
Bankr. S.D. Calif. Case No. 19-02770
Chapter 11 Petition filed May 9, 2019
represented by: Bruce R. Babcock, Esq.
LAW OFFICE OF BRUCE R. BABCOCK
E-mail: brbab@hotmail.com
In re Barbara Stone
Bankr. S.D. Fla. Case No. 19-16164
Involuntary Chapter 11 Petition filed May 9, 2019
Filed Pro Se
In re Sergey Motuz
Bankr. E.D.N.Y. Case No. 19-42905
Chapter 11 Petition filed May 9, 2019
represented by: Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
E-mail: alla@kachanlaw.com
In re 451 Hancock LLC
Bankr. E.D.N.Y. Case No. 19-73394
Chapter 11 Petition filed May 9, 2019
Filed Pro Se
In re Shams Islam, LLC
Bankr. E.D. Pa. Case No. 19-13008
Chapter 11 Petition filed May 9, 2019
See http://bankrupt.com/misc/paeb19-13008.pdf
represented by: Lewis P. Hannah, Esq.
LEWIS P HANNAH & ASSOCIATES LLC
E-mail: lhannah969@aol.com
lphcourtfilings@verizon.net
In re RRQ, LLC
Bankr. E.D. Pa. Case No. 19-13045
Chapter 11 Petition filed May 9, 2019
See http://bankrupt.com/misc/paeb19-13045.pdf
represented by: Stuart A. Eisenberg, Esq.
Carol McCullough, Esq.
MCCULLOUGH EISENBERG, LLC
E-mail: mccullougheisenberg@gmail.com
In re Donald R. Borde
Bankr. W.D. Wisc. Case No. 19-11557
Chapter 11 Petition filed May 9, 2019
represented by: Virginia E. George, Esq.
STEINHILBER SWANSON LLP
E-mail: vgeorge@steinhilberswanson.com
In re Rustic Steel Creations, Inc.
Bankr. M.D. Fla. Case No. 19-04467
Chapter 11 Petition filed May 10, 2019
See http://bankrupt.com/misc/flmb19-04467.pdf
represented by: Daniel E. Etlinger, Esq.
JENNIS LAW FIRM
E-mail: detlinger@jennislaw.com
ecf@jennislaw.com
In re Shawnee Cab, Corp.
Bankr. E.D.N.Y. Case No. 19-42927
Chapter 11 Petition filed May 10, 2019
See http://bankrupt.com/misc/nyeb19-42927.pdf
represented by: Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
E-mail: alla@kachanlaw.com
In re Karen L. Bezzina
Bankr. E.D.N.Y. Case No. 19-73432
Chapter 11 Petition filed May 10, 2019
represented by: Darren Aronow, Esq.
ARONOW LAW FIRM P.C.
E-mail: darren@dalawpc.com
In re Michael Glenn
Bankr. M.D. Ala. Case No. 19-31294
Chapter 11 Petition filed May 10, 2019
represented by: Michael A. Fritz, Sr., Esq.
E-mail: bankruptcy@fritzlawalabama.com
In re Richard E. Moreno
Bankr. C.D. Calif. Case No. 19-15482
Chapter 11 Petition filed May 10, 2019
represented by: Thomas B. Ure, Esq.
URE LAW FIRM
E-mail: tbuesq@aol.com
In re Carlos Antonio Avelar
Bankr. N.D. Calif. Case No. 19-30524
Chapter 11 Petition filed May 10, 2019
represented by: Andrew A. Moher, Esq.
MOHER LAW GROUP
E-mail: amoher@moherlaw.com
In re Molto Bene LLC
Bankr. D.N.J. Case No. 19-19604
Chapter 11 Petition filed May 10, 2019
See http://bankrupt.com/misc/njb19-19604.pdf
represented by: Darren M. Baldo, Esq.
DARREN M BALDO, ESQ, LLC
E-mail: darren@dbaldolaw.com
In re Anait Akopyan
Bankr. C.D. Cal. Case No. 19-11192
Chapter 11 Petition filed May 13, 2019
represented by: Michael Jay Berger, Esq.
E-mail:
michael.berger@bankruptcypower.com
In re Patrick Kok Wah Wong
Bankr. C.D. Cal. Case No. 19-11834
Chapter 11 Petition filed May 13, 2019
represented by: Michael Jones, Esq.
M JONES & ASSOCIATES, PC
E-mail: mike@mjthelawyer.com
In re Cyrus Ansari
Bankr. N.D. Cal. Case No. 19-30529
Involuntary Chapter 11 Petition filed May 13, 2019
See http://bankrupt.com/misc/canb19-30529.pdf
represented by: Pro Se
In re 140905 - A Fish Funding Trust
Bankr. N.D. Cal. Case No. 19-41103
Chapter 11 Petition filed May 13, 2019
See http://bankrupt.com/misc/canb19-41103.pdf
represented by: William F. McLaughlin, Esq.
LAW OFFICES OF WILLIAM F. MCLAUGHLIN
E-mail: mcl551@aol.com
In re Indy Facets, LLC
Bankr. S.D. Ind. Case No. 19-03433
Chapter 11 Petition filed May 13, 2019
See http://bankrupt.com/misc/insb19-03433.pdf
represented by: Eric C. Redman, Esq.
REDMAN LUDWIG, PC
E-mail: eredman@redmanludwig.com
In re Plattsburgh Medical Care PLLC
Bankr. N.D.N.Y. Case No. 19-10894
Chapter 11 Petition filed May 13, 2019
See http://bankrupt.com/misc/nynb19-10894.pdf
represented by: Justin A. Heller, Esq.
NOLAN HELLER KAUFFMAN LLP
E-mail: jheller@nhkllp.com
In re Commercial Investments, LLC
Bankr. E.D. Wisc. Case No. 19-24658
Chapter 11 Petition filed May 13, 2019
See http://bankrupt.com/misc/wieb19-24658.pdf
represented by: Michael J. Cerniglia, Esq.
KREKELER STROTHER, S.C.
E-mail: mjcerniglia@ks-lawfirm.com
In re Michael Rehman
Bankr. D. Md. Case No. 19-16590
Chapter 11 Petition filed May 14, 2019
represented by: Steven H. Greenfeld, Esq.
COHEN, BALDINGER & GREENFELD, LLC
E-mail: steveng@cohenbaldinger.com
In re William Hall Stewart and Carol Ann Stewart
Bankr. D. Mont. Case No. 19-60453
Chapter 11 Petition filed May 13, 2019
represented by: Gary S. Deschenes, Esq.
DESCHENES & ASSOCIATES
E-mail: gsd@dalawmt.com
In re Wanda Cepeda
Bankr. D. Nev. Case No. 19-13008
Chapter 11 Petition filed May 14, 2019
Filed Pro Se
In re L.L.G. Cab, Corp.
Bankr. E.D.N.Y. Case No. 19-42956
Chapter 11 Petition filed May 14, 2019
See http://bankrupt.com/misc/nyeb19-42956.pdf
represented by: Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
E-mail: alla@kachanlaw.com
In re Uriel Property Management
Bankr. E.D.N.Y. Case No. 19-73466
Chapter 11 Petition filed May 13, 2019
Filed Pro Se
In re Pacific Construction Group, LLC
Bankr. D. Oregon Case No. 19-31770
Chapter 11 Petition filed May 14, 2019
See http://bankrupt.com/misc/orb19-31770.pdf
represented by: Nicholas J. Henderson, Esq.
MOTSCHENBACHER & BLATTNER, LLP
E-mail: nhenderson@portlaw.com
In re 4709 Incorporated
dba Midtown Live Sports Cafe
Bankr. W.D. Tex. Case No. 19-10624
Chapter 11 Petition filed May 14, 2019
See http://bankrupt.com/misc/txwb19-10624.pdf
represented by: Darwin McKee, Esq.
LAW OFFICE OF DARWIN MCKEE
E-mail: darwinmckee@yahoo.com
In re Mian Abid Hussain
Bankr. E.D. Va. Case No. 19-11597
Chapter 11 Petition filed May 14, 2019
represented by: Michael Jacob Owen Sandler, Esq.
FISHER-SANDLER, LLC
E-mail: sandlerlaw@yahoo.com
*********
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 ***