/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/210708.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, July 8, 2021, Vol. 25, No. 188 Headlines 11500 SPACE: Voluntary Chapter 11 Case Summary 2999TC LP: Unsecureds Will be Paid in Full Over 5 Years ABRI HEALTH CARE: Taps Ankura Consulting as Valuation Expert ADVAXIS INC: Signs Definitive Merger Agreement With Biosight AIR INDUSTRIES: Signs Agreement for F-35 Landing Gear Components ALLEN MEDIA: Moody's Affirms 'B2' CFR & Rates New Term Loan 'Ba3' AMERICANN INC: Reports Nearly 300% Increase in Quarterly Revenue APP REALTY: Seeks Approval to Hire Fisher Auction Company APP REALTY: Seeks to Employ Bauch & Michaels as Local Counsel ARBORETUM CROSSING: Case Summary & 10 Unsecured Creditors ARS REI: Unsecured Claims to be Paid in Full Under Plan ATI PHYSICAL: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable ATLANTIC AVIATION: S&P Downgrades ICR to 'B' on Leveraged Buyout AULT GLOBAL: Adjourns Annual Meeting to July 23 BEAR COMMUNICATIONS: Has Access to Cash Collateral Thru July 26 BELK INC: Appoints New CEO Months After Leaving Bankruptcy BERRY GLOBAL: Moody's Hikes CFR to Ba1, Outlook Stable BRAZOS ELECTRIC: Seeks Approval to Hire Special Litigation Counsel BULLFROG LOGISTICS: Hits Chapter 11 Bankruptcy Protection CANNABICS PHARMACEUTICALS: Appoints New Independent Director CARVANA CO: Unit Increases Floor Plan Facility to $1.75 Billion CENTER CITY : Owner Seeks Trustee to Retaliate Over Suit CLEVELAND BIOLABS: Stockholders Approve Two Proposals at Meeting COLUMBIAN FINANCIAL: A.M. Best Reviews B(Fair) Fin. Strength Rating CYPRUS MINES: FCR Seeks to Hire Frankel Wyron as Legal Counsel DEA BROTHERS: May Use Cash Collateral, Pay Creditor DIOCESE OF WINONA-ROCHESTER: Unsecured Claims Unimpaired Under Plan DOMINION DEVELOPMENT: Case Summary & 12 Unsecured Creditors EAGLE HOSPITALITY: Rejection Dispute Impacts Chapter 11 Case EMPLOYBRIDGE HOLDING: Moody's Assigns B2 CFR on Revenue Growth EVERCOMMERCE SOLUTIONS: Moody's Affirms B1 CFR Amid Recent IPO EXPO CONSTRUCTION: Hearing Continued on July 7 FIFTEEN TWENTY: Voluntary Chapter 11 Case Summary FORT DEARBORN: Clayton Acquisition No Impact on Moody's B3 Rating GIRARDI & KEESE: Victims Get Court Okay to Go After Erika for Funds GROUPE SOLMAX: S&P Assigns 'B' Long-Term ICR, Outlook Stable HASTINGS AND HOLLOWELL: Unsecureds to Get Full Payment Under Plan HOUSTON AMERICAN: Ault Global Has 9.9% Stake as of June 30 HY "C": Case Summary & Unsecured Creditor HYDROCARBON FLOW: Case Summary & 20 Largest Unsecured Creditors HYDROCARBON HY-VAC: Case Summary & Unsecured Creditor INTEGRATED AG: GWB Says Disclosure Deficient INTEGRATED AG: UST Says Disclosure Inadequate KATERRA INC: Seeks Approval to Hire KPMG LLP as Tax Consultant KATERRA INC: Seeks to Hire Houlihan Lokey as Investment Banker KATERRA INC: Seeks to Hire Kirkland & Ellis as Legal Counsel KATERRA INC: Taps Alvarez & Marsal as Restructuring Advisor KKR APPLE: Moody's Assigns First Time B2 Corporate Family Rating KLAUSNER LUMBER: Unsecureds to Receive $7.2 million LABL INC: Clayton Acquisition No Impact on Moody's B3 Rating LAS VEGAS SANDS: Egan-Jones Keeps BB- Unsec. Debt Ratings LATAM AIRLINES: Court Extends Bankruptcy Plan Deadline to September LAUREATE EDUCATION: Moody's Withdraws B1 Corporate Family Rating LERETA LLC: Moody's Assigns First Time B2 Corporate Family Rating LERETA LLC: S&P Assigns 'B-' Issuer Credit Rating, Outlook Stable LIVEXLIVE MEDIA: Increases Available Shares Under Incentive Plan LOANCORE CAPITAL: S&P Withdraws 'B' Long-Term Issuer Credit Rating MAH 710 PARK: Seeks Approval to Hire Havkin & Shrago as Counsel MEA REMAINCO: Court Approves Plan and Disclosures MERIDIAN ADHESIVES: Moody's Assigns B2 CFR, Outlook Stable MERMAID BIDCO: New $100MM Loan Add-on No Impact on Moody's B2 CFR MOTT LLC: Voluntary Chapter 11 Case Summary NAVITAS MIDSTREAM: $90MM Add-on Loan No Impact on Moody's B3 CFR NEW CONCEPTS: Seeks Approval to Hire GrayRobinson as Legal Counsel NEW HYDE PARK: Case Summary & 16 Unsecured Creditors NEW YORK CLASSIC: Committee Seeks to Hire Arent Fox as Counsel NEW YORK CLASSIC: Committee Taps CBIZ as Financial Advisor NS8 INC: Former Worker Settles $4 Million Stock Buyback Claim ONDAS HOLDINGS: Special Meeting of Shareholders Set for Aug. 5 POGO ENERGY: Hits Chapter 11 as TexasFreeze Fallout Lingers PURDUE PHARMA: Greene County to Continue Receiving Money ROCHESTER DIOCESE: Proposed Insurers' Settlement Questioned SCHULDNER LLC: Case Summary & 3 Unsecured Creditors SEASPAN CORP: S&P Assigns 'BB-' Long-Term ICR, Outlook Stable SEMILEDS CORP: Inks $20M Sales Agreement With Roth Capital SHUTTERFLY LLC: S&P Rates New $1.105BB Sr. Secured Term Loan 'B-' SPICE MUST FLOW: Case Summary & 5 Unsecured Creditors STONEWAY CAPITAL: Seeks to Hire Bennett Jones as Canadian Counsel STONEWAY CAPITAL: Seeks to Hire Shearman & Sterling as Counsel STONEWAY CAPITAL: Taps Prime Clerk as Administrative Advisor SUITABLE TECHNOLOGIES: Wife, Founder Drops Case Due to Bankruptcy TECT AEROSPACE: Boeing Is the Winner of Kansas Bankruptcy Auction TEMPO ACQUISITION: Moody's Hikes CFR to Ba3, Outlook Stable U.S. TOBACCO: Case Summary & 20 Largest Unsecured Creditors VENOCO LLC: Trustee Asks Court Okay for $852 Mil. Spill Settlement WASHINGTON PRIME: Seeks to Hire Jackson Walter as Co-Counsel WASHINGTON PRIME: Taps Alvarez & Marsal as Restructuring Advisor WASHINGTON PRIME: Taps Kirkland & Ellis as Lead Bankruptcy Counsel WCOP INC: Seeks to Employ Bill Marinakos as Accountant WEINSTEIN CO: Accuser Can Recover Chapter 11 Mediation Costs ZUCA PROPERTIES: Seeks to Employ Compass Inc. as Real Estate Broker [^] Recent Small-Dollar & Individual Chapter 11 Filings ********* 11500 SPACE: Voluntary Chapter 11 Case Summary ---------------------------------------------- Debtor: 11500 Space Center, LLC 1302 Waugh Drive Suite 386 Houston, TX 77019 Business Description: 11500 Space Center, LLC is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: July 6, 2021 Court: United States Bankruptcy Court Southern District of Texas Case No.: 21-32299 Judge: Hon. David R. Jones Debtor's Counsel: Melissa A. Haselden, Esq. HASELDEN FARROW PLLC 700 Milam, Suite 1300 Pennzoil Place Houston, TX 77002 Tel: (832) 819-1149 Email: mhaselden@haseldenfarrow.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by John Kevin Munz, president of Manager. The Debtor failed to include in the petition a list of its 20 largest unsecured creditors. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/DPFY7IY/11500_Space_Center_LLC__txsbke-21-32299__0001.0.pdf?mcid=tGE4TAMA 2999TC LP: Unsecureds Will be Paid in Full Over 5 Years ------------------------------------------------------- 2999TC LP, LLC, submitted a Second Amended Disclosure Statement explaining its Chapter 11 Plan. The Debtor owns a membership interest and a $4,000,000.00 capital account in 2999TC JMJ MGR, LLC, which is part of a group of entities collectively owning a 2.5-acre tract of real property located at 2999 Turtle Creek Boulevard in Dallas, Texas (the "Property"), to be developed into a luxury hotel and condominiums. The Debtor will fund the Plan from the proceeds of a redemption of its capital account by 2999TC JMJ MGR, LLC. This redemption will occur approximately six to nine months after the Effective Date of the Plan through a refinance of the Property and recapitalization of all entities holding direct or indirect interests in the Property, including 2999TC JMJ MGR, LLC. In other words, the property owners, spearheaded by 2999TC JMJ MGR, LLC will obtain a construction loan to refinance the existing debt on the Property and complete the construction project. From the proceeds of the construction loan, the Debtor will receive $4,000,000 on account of its capital interest in 2999TC JMJ MGR, LLC and will use this money to make the payments under the Plan. The Plan will pay all Allowed Claimants 100% of their Claims, with interest. Class 3 Allowed General Unsecured Claims will be paid in full, over five years in equal monthly installments commencing on the first day of the month following the Effective Date and continuing on the first day of each succeeding month with a final lump sum payment of the full remaining balance due within 60 months from the first payment. Interest at the rate of 1% per annum shall begin to accrue on the Effective Date. Class 3 is impaired. Attorneys for the Debtor: Joyce W. Lindauer Kerry S. Alleyne Guy H. Holman Joyce W. Lindauer Attorney, PLLC 1412 Main Street, Suite 500 Dallas, Texas 75202 Telephone: (972) 503-4033 Facsimile: (972) 503-4034 A copy of the Disclosure Statement is available at https://bit.ly/2SBMmZn from PacerMonitor.com. About 2999TC LP LLC 2999TC LP, LLC, filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 20 43204) on Oct. 16, 2020. 2999TC President Tim Barton signed the petition. At the time of the filing, the Debtor was estimated to have $1 million to $10 million in both assets and liabilities. Judge Mark X. Mullin oversees the case. Joyce W. Lindauer Attorney PLLC serves as the Debtor's counsel. ABRI HEALTH CARE: Taps Ankura Consulting as Valuation Expert ------------------------------------------------------------ Abri Health Care Services, LLC and Senior Care Centers, LLC seek approval from the U.S. Bankruptcy Court for the Northern District of Texas to hire Dallas-based valuation expert Ankura Consulting Group, LLC. The firm's services include: a) the preparation of valuation analyses of the Debtors' skilled nursing facilities; b) the preparation of expert valuation reports; c) expert witness testimony services; d) professional advice on bankruptcy and restructuring issues within Ankura's scope of expertise; and e) other professional services as may be requested by the Debtors and agreed to by Ankura in writing. The firm's hourly rates are as follows: Senior Managing Director/ $650 - $1,155 per hour Managing Director Other Professionals $350 - $870 per hour Paraprofessional $275 - $330 per hour Louis Robichaux IV, senior managing director at Ankura, disclosed in a court filing that the firm is a "disinterested person" as defined within Bankruptcy Code Section 101(14). The firm can be reached through: Louis E. Robichaux IV Ankura Consulting Group, LLC 15950 Dallas Parkway, Suite 750 Dallas, TX 75248 Phone: 214-200-3689 Mobile: 214-924-1575 Email: louis.robichaux@ankura.com About Abri Health Care Services Founded in 2009, Abri Health Care Services, LLC -- https://abrihealthcare.com -- offers skilled nursing services, short-term rehabilitation, long-term care, and assisted living in over 22 locations across Texas. Abri Health Care Services and subsidiary Senior Care Centers, LLC sought Chapter 11 protection (Bankr. N.D. Texas Lead Case No. 21-30700) on April 16, 2021. In the petition signed by CEO Kevin O'Halloran, Abri Health Care Services disclosed total assets of up to $50 million and total liabilities of up to $10 million. The cases are handled by Judge Stacey G. Jernigan. The Debtor tapped Polsinelli, PC as legal counsel and CliftonLarsonAllen, LLP as accountant and tax consultant. ADVAXIS INC: Signs Definitive Merger Agreement With Biosight ------------------------------------------------------------ Advaxis, Inc. and Biosight Ltd. have entered into a definitive merger agreement pursuant to which the shareholders of Biosight will become the majority holders of the combined company immediately following completion of the transaction. The proposed merger will create a public company that will prioritize the clinical advancement and commercialization of Biosight's lead product, aspacytarabine (BST-236). The combined company is expected to have approximately $50 million in cash, cash equivalents and marketable securities at closing. Following the closing, which is expected to occur in the second half of 2021, Advaxis will be renamed Biosight Therapeutics and is expected to trade on the Nasdaq Capital Market under the ticker symbol "BSTX". The combined company plans to advance its pipeline through multiple clinical trials, and anticipates the following milestones over the next 12-18 months: * Topline results from the ongoing Phase 2 trial of aspacytarabine, which has completed enrolment, as first-line therapy in AML patients who are unfit for standard chemotherapy * Recent data presented at ASCO showed that aspacytarabine achieved complete remission (CR) rates of 39% across all evaluable patients (n=46) with 63% of cases with negative minimal residual disease (MRD(-)) and median overall survival (OS) of 10 months at present (95% CI, 6- NR). Altogether these results are encouraging considering the high risk factors in this population at baseline; * Results from the Phase 2 trial of aspacytarabine in collaboration with the European cooperative group, Groupe Francophone des Myelodysplasies (GFM) in patients with relapsed/refractory AML and higher-risk Myelodysplastic Syndrome (MDS); * Initiation in the U.S. of a second, Phase 2 trial of aspacytarabine in patients with relapsed/refractory AML and higher-risk MDS; * Results from the ongoing Phase 1/2 trial with ADXS-503 in combination with pembrolizumab in non-small cell lung cancer; and * Results from the Phase 1 trial of ADXS-504 in biochemically recurrent prostate cancer "After an extensive and thorough review of strategic and potentially transformative options for Advaxis, we are very pleased to announce a proposed merger with Biosight," said Kenneth A. Berlin, president, chief executive officer and interim chief financial officer of Advaxis. "We believe the combined company's strong and diversified oncology pipeline with late stage and early stage assets, near-term milestones, seasoned leadership team and focus on both hematological malignancies and solid tumors have the potential to provide transformative benefits to patients while also providing value to our stockholders." "The proposed merger with Advaxis is a unique opportunity for Biosight to build a leading public company in oncology, with a diversified clinical pipeline in both hematological malignancies and solid tumors. The combined company will have the demonstrated expertise and strong balance sheet to advance its lead programs towards multiple anticipated milestones over the next 12 to 18 months," said Dr. Ruth Ben Yakar, CEO of Biosight. "I would like to express my deepest appreciation to the wonderful Biosight team, including Dr. Liat Flaishon and Dr. Shoshi Tessler who lead our R&D activities, and Dr. Stela Gengrinovitch the founder of the company. The excellent work and dedication of the entire Biosight team enabled the significant achievements. I would also like to thank our Board of Directors and Shareholders for their support over the years." About the Proposed Merger Pursuant to the merger agreement, Advaxis will acquire all of the outstanding share capital of Biosight in exchange for the issuance of newly issued shares of Advaxis common stock upon closing, subject to the satisfaction or waiver of customary closing conditions, including the receipt of the required approval of the Advaxis stockholders and Biosight stockholders and certain regulatory approvals. Upon completion of the merger, Advaxis's then-current equity holders will own approximately 25% and the former Biosight equity holders will own approximately 75% percent of Advaxis's common stock, calculated on a fully diluted basis. The transaction has been unanimously approved by the board of directors of both companies. The combined company will be headquartered out of new facilities expected to be located in New Jersey and will continue to maintain its presence in Israel. LifeSci Capital LLC acted as exclusive financial advisor to Advaxis.Morgan, Lewis & Bockius LLP and Herzog Fox & Neeman are serving as legal counsel to Advaxis. White & Case and Horn & Co. are serving as legal counsel to Biosight. Management and Organization Effective as of the closing of the transaction, Ken Berlin will be the president and chief executive officer of the combined company. Senior leadership of the combined company will also include Roy Golan, as chief financial officer, Andres Gutierrez, M.D., Ph.D., and Darrel Cohen, M.D., Ph.D. as chief medical officers. Additionally, effective as of the closing of the merger, the Board of Directors of the combined company will be comprised of nine directors: six designated by Biosight and two to be designated by Advaxis, and Dr. David Sidransky will be nominated as Chairman of the Board. About Advaxis Inc. Advaxis, Inc. -- http://www.advaxis.com-- is a clinical-stage biotechnology company focused on the development and commercialization of proprietary Lm-based antigen delivery products. These immunotherapies are based on a platform technology that utilizes live attenuated Listeria monocytogenes (Lm) bioengineered to secrete antigen/adjuvant fusion proteins. These Lm-based strains are believed to be a significant advancement in immunotherapy as they integrate multiple functions into a single immunotherapy and are designed to access and direct antigen presenting cells to stimulate anti-tumor T cell immunity, activate the immune system with the equivalent of multiple adjuvants, and simultaneously reduce tumor protection in the tumor microenvironment to enable T cells to eliminate tumors. Advaxis reported a net loss of $26.47 million for the year ended Oct. 31, 2020, a net loss of $16.61 million for the year ended Oct. 31, 2019, and a net loss of $66.51 million for the year ended Oct. 31, 2018. As of April 30, 2021, the Company had $55.77 million in total assets, $8.22 million in total liabilities, and $47.55 million in total stockholders' equity. AIR INDUSTRIES: Signs Agreement for F-35 Landing Gear Components ---------------------------------------------------------------- Air Industries Group has received a follow-on Long-Term Agreement (LTA) to produce landing gear components for the F-35 Joint Strike Fighter Aircraft. The LTA from the Company's customer estimates purchases of between $12 and $18 million over the three-year period beginning in 2022 through 2024. Air Industries produces many landing gear components used on all three variants of the Aircraft. Mr. Lou Melluzzo, CEO of Air Industries commented: "Air Industries has produced landing gear components for the F-35 since the inception of production of the Aircraft. We are very pleased to be part of this historic program and to continue supporting the war fighter as production of the Aircraft approaches full-rate." About Air Industries Headquartered in Bay Shore, New York, Air Industries Group is an integrated manufacturer of precision equipment assemblies and components for aerospace and defense prime contractors. Air Industries reported net income of $1.10 million for the year ended Dec. 31, 2020, compared to a net loss of $2.73 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $57.36 million in total assets, $42.19 million in total liabilities, and $15.17 million in total stockholders' equity. * * * This concludes the Troubled Company Reporter's coverage of Air Industries until facts and circumstances, if any, emerge that demonstrate financial or operational strain or difficulty at a level sufficient to warrant renewed coverage. ALLEN MEDIA: Moody's Affirms 'B2' CFR & Rates New Term Loan 'Ba3' ----------------------------------------------------------------- Moody's Investors Service affirmed Allen Media, LLC's B2 Corporate Family Rating and B2-PD Probability of Default Rating, and all instrument ratings including the Ba3 Senior Secured Credit Facility and Caa1 Senior Unsecured Notes. Moody's also assigned a Ba3 rating to the new $100 million Delayed Draw Term Loan B add-on and Caa1 to the upsized Senior Unsecured Notes. The outlook remains stable. Allen Media is planning to acquire television stations in 10 markets from several parties for approximately $500 million cash in aggregate (the "Transaction"). The Company has entered into agreements to acquire television stations in 7 markets from Gray Television, Inc. (Gray, B1 Stable). The Transaction is part of Gray's broader plan to divest stations in connection with its acquisition of Quincy Media, Inc. (Quincy, B2 positive), in order to comply with regulatory restrictions in overlap markets. Allen Media is in negotiations to acquire other television stations in 3 additional markets. In addition, the Company plans to transfer its ABC station in Honolulu, HI (KITV) from its unrestricted subsidiary into the Restricted Group. The Company is seeking to finance the Transaction, refinance existing debt, and pay related fees with balance sheet cash and $550 million in debt, including a $210 million add on (including a $100 million delayed draw) to the existing Term Loan B and $340 million add on to the existing Senior Unsecured Notes. Given the constraints of the incurrence covenants, the Company will seek and require consents from existing loan and note holders to incur the incremental debt. In addition, the Company plans to upsize the existing $60 million revolving credit facility to $100 million. In the event any of the contemplated acquisitions are unsuccessful, the related portion of the debt financing would be reduced accordingly. The financing is expected to close in Q3 2021, subject to regulatory approvals, closing of Gray's acquisition of Quincy, obtaining consent from existing lenders, and other customary closing conditions. Moody's views the transaction as credit positive, with greater scale and a better mix of assets acquired at an attractive multiple that will be slightly deleveraging (about .25x lower). The Transaction further enhances Allen Media's scale, diversifies its business towards broadcasting, and strengthens its relationships with MVPDs. Pro forma, the Company will operate a growing portfolio of 28 highly-ranked, Big-4 television stations in 21 markets and comparable in size to other single B rated broadcast affiliates. The Company will gain #2 and #3 ranked TV stations in complementary, mid-sized markets across the Midwest, West and Southeast, adding Big-4 affiliates in each market, including local franchises in key battleground states (Wisconsin, Arizona, Iowa and an additional Midwest state). Assignments: Issuer: Allen Media, LLC Gtd. Senior Secured Delayed Draw Term Loan, Assigned Ba3 (LGD3) Gtd. Senior Unsecured Notes, Assigned Caa1 (LGD5) Affirmations: Issuer: Allen Media, LLC Probability of Default Rating, Affirmed B2-PD Corporate Family Rating, Affirmed B2 Gtd. Senior Secured Bank Revolving Facility, Affirmed Ba3 (LGD3) Gtd. Senior Secured Term Loan, Affirmed Ba3 (LGD3) Gtd. Senior Unsecured Notes, Affirmed Caa1 (LGD5) Outlook Actions: Issuer: Allen Media, LLC Outlook, Remains Stable RATINGS RATIONALE Allen Media's B2 CFR is constrained by governance risk, including an aggressive debt-financed M&A growth strategy. Leverage (Moody's adjusted, pro forma for pending acquisitions) is above Moody's tolerance, over 13x (LTM last quarter), but should fall to the low to mid 6x range by the end of 2023 (Moody's adjusted 2-year average), absent leveraging events. The Company is also 100% owned and managed by the founder and CEO, with no independent board and is also still relatively small in scale despite the contemplated acquisitions, with pro forma revenue near $590 million (Moody's adjusted), and rising but still constrained free cash flow. Exposure to unfavorable secular trends in linear pay-TV is also a constraint, with the loss of video subscribers averaging mid-single-digit percent across US cable operators but can be much higher at individual MVPD's. Investments outside the restricted group are also not uncommon, which can reduce the financial flexibility and liquidity profile of the Company. Supporting the credit profile is a diverse group of media properties including ownership of 28 TV stations across 21 markets (pro forma) with big four affiliates in all markets, reaching approximately 5% of U.S. households. The portfolio is diversified across Big Four networks, with a majority of stations ranked #1 or #2 (by revenue). In addition, the Company owns the Weather Channel with about 60 million subscribers, and 7 HD TV & 2 OTA broadcast networks reaching 130 million cumulative subscribers pro forma for recent carriage deals. The business model is supported by recurring/long-term contracted (broadcast) retransmission fees and (cable net) affiliate fees, and benefits from low capital intensity, yielding EBITDA margins of at least mid-30%. Also supporting the credit profile are social factors, primarily societal changes that are driving positive developments in operating performance. In particular, the Company is gaining greater distribution of its cable network programming and a greater share of the advertising spend as a result of being a black-owned media company. The Company has adequate liquidity. Cash and cash flows are positive but constrained, there is limited access to the revolving credit facility, loans are covenant-lite and alternate liquidity is limited with a partially secured capital structure. Moody's instrument ratings reflect the probability of default of the company (as reflected in the B2-PD Probability of Default rating) and an average recovery of approximately 50% in Moody's assumed default scenario, in the aggregate, across all creditors given the mixed capital structure with both senior and junior claim priorities. The senior secured credit facilities are rated Ba3 (LGD3), two notches above the B2 CFR given the losses expected to be absorbed by junior capital. The unsecured notes are rated Caa1 given its subordination in the capital structure. The Company is subject to governance risk. Financial policy targets elevated leverage, specifically net leverage of 4.5x-5.0x, but the ratio is currently well above that range and Moody's tolerances (on Moody's adjusted, 2-year average basis), due to debt-financed acquisitions and a significant drop in advertising revenue through the pandemic. However, Moody's expect favorable developments related to new distribution agreements and a higher share of advertising spend, the contribution of pending acquisitions, organic EBITDA growth and post-COVID recovery, the benefits of scale and higher operating leverage, and voluntary debt repayment with rising excess cash flows, will drive leverage near the high end of Moody's leverage tolerance over the next 12-18 months, absent debt-financed corporate actions. The business is also wholly-owned and managed by the founder and CEO who has broad discretion over the business, including the ability to direct operations and business strategies. There is no Board of independent directors to check more equity-friendly corporate actions including the ability to extract cash for dividends and or investments outside the restricted group that could reduce the liquidity profile of the Company. The stable outlook reflects Moody's expectations that debt, revenues, and EBITDA will average near $1.5 billion, $650 million, and $450 million respectively, over the next 12-18 months. Moody's assume EBITDA margins will be in the mid-30% range. Moody's project leverage will fall to low to mid 6x (gross debt/2-year average EBITDA) by the end of 2023, absent further leveraging events. Free cash flows will rise to at least $30 million, or near 2% of debt. Moody's also expect the Company to maintain adequate liquidity. Note: All figures are Moody's adjusted, unless otherwise noted. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could consider positive rating action if revenues and profitability grow, leverage (Moody's adjusted total gross debt / 2-year average EBITDA) is sustained below 4.75x, free cash flow to debt (Moody's adjusted 2-year FCF / total gross debt) is sustained in the high single digits and the Company demonstrates a track record and a commitment to more conservative financial policies. Moody's could consider a negative rating action if leverage (Moody's adjusted total gross debt / 2- year average EBITDA) is sustained above 6.0x, or free cash flow to debt (Moody's adjusted 2-year FCF / total gross debt) falls below 2.5%. Moody's could also consider a negative rating action if liquidity deteriorated, scale or quality of assets diminished, or operating performance weakened materially on a sustained basis. The principal methodology used in these ratings was Media published in June 2021. Allen Media, LLC is a minority-owned, privately-held diversified media company that owns and operates 28 highly ranked Big 4 broadcast television stations, in 21 markets (pro forma for pending acquisitions). The Weather Channel, seven 24-hour high-definition television networks and two broadcast networks. With these assets, the Company produces local weather, news, sports and entertainment programming and content including Emmy Award-winning and nominated shows that reach over 190 million subscribers. Broadcast television affiliations include ABC, CBS, FOX and NBC networks (collectively, the "Big Four" networks). Entertainment Studios produces and distributes 41 television programs including Cars.TV, Comedy.TV, ES.TV, Justice Central.TV, Recipe.TV, MyDestination.TV, and Pets.TV. The Company also owns broadcast networks TheGrio.TV and This TV. AMERICANN INC: Reports Nearly 300% Increase in Quarterly Revenue ---------------------------------------------------------------- AmeriCann, Inc. provided financial and operational updates for its flagship project, the Massachusetts Cannabis Center. AmeriCann's Operating Revenue from the Massachusetts Cannabis Center for the quarter ending June 2021 increased nearly 300% from the quarter ending June 2020. AmeriCann's Massachusetts Cannabis Center is located on a 52-acre parcel in Southeastern Massachusetts. The project is permitted for 987,000 sq. ft. of cannabis cultivation and processing infrastructure, which is being developed in phases, and supports both the existing medical cannabis and the adult-use cannabis markets. The initial phase of the development, Building 1, is a 30,000 square foot cultivation greenhouse and processing facility, that utilizes AmeriCann's proprietary "Cannopy" cultivation system. Building 1 is fully occupied by Bask, Inc., an existing Massachusetts licensed vertically integrated cannabis operator. AmeriCann receives Base Rent and a Revenue Participation Fee from Bask of 15% of all gross monthly sales of cannabis, cannabis-infused products and non-cannabis products produced at Massachusetts Cannabis Center. "AmeriCann's nearly 300% Year-over-Year revenue growth is a result of a consistent increase in operational performance from Building 1," stated CFO Ben Barton. "The strong top-line growth compared to a year ago reflects a trend we expect to continue as sales from cultivation and manufacturing accelerate." "AmeriCann's nearly 300% Year-over-Year revenue growth is a result of a consistent increase in operational performance from Building 1," stated CFO Ben Barton. "The strong top-line growth compared to a year ago reflects a trend we expect to continue as sales from cultivation and manufacturing accelerate." A summary of operational highlights included the following: * AmeriCann's Operating Revenue in the quarter ending June 2021 increased 298% from the quarter that ended June 2020. * AmeriCann's Operating Revenue from the Massachusetts Cannabis Center increased over 35% from the quarter that ended June 2021 from the prior quarter. * The manufacturing of cannabis infused products, including the recently launched 1906 branded "Drops", has increased dramatically in Building 1. * Sales of manufactured infused products produced at Building 1 have achieved success as some of the best selling cannabis brands in Massachusetts in their respective categories. * AmeriCann's joint venture partner, Bask, Inc. added adult-use retail sales in February. Since this time, retail sales have shown consistent increases which have resulted in enhanced revenue for AmeriCann. * In May 2021, the Massachusetts market sold $122 million of cannabis. The total sales for the first five months of 2021 have exceeded $580 million putting the market on track for $1.4 billion in total sales for 2021. The strength of the Massachusetts market is reflected in the Commonwealth having the highest average purchase prices in the nation and the second highest price per-gram within U.S. adult-use markets. * Cannabis sales nationally have been excellent as the industry has produced strong sales growth in markets across the country. * AmeriCann has secured cultivation and manufacturing licenses for Building 2 - the next phase of the Massachusetts Cannabis Center. Building 2 calls for approximately 400,000 additional square feet of cannabis cultivation, manufacturing and distribution infrastructure. Plans for the 400,000 sf Building 2 facility will accommodate both Bask and AmeriCann in dedicated cultivation spaces. Additionally, AmeriCann will operate a centralized product manufacturing facility in Building 2 designed to support the entire 1 million square foot MCC campus. AmeriCann was awarded two licenses from the Massachusetts Cannabis Control Commission including one for cannabis cultivation and one for cannabis product manufacturing. About Americann Headquartered in Denver, AmeriCann is a specialized cannabis company that is developing cultivation, processing and manufacturing facilities. Americann reported a net loss of $709,343 for the year ended Sept. 30, 2020, compared to a net loss of $4.90 million for the year ended Sept. 30, 2019. As of March 31, 2021, the Company had $14.82 million in total assets, $9.75 million in total liabilities, and $5.07 million in total stockholders' equity. MaloneBailey, LLP, in Houston, Texas, the Company's auditor since 2016, issued a "going concern" qualification in its report dated Dec. 21, 2020, citing that the Company has suffered recurring losses from operations and has a net capital deficiency that raises substantial doubt about its ability to continue as a going concern. APP REALTY: Seeks Approval to Hire Fisher Auction Company --------------------------------------------------------- APP Realty, LLC and APP Car Wash, LLC seek approval from the U.S. Bankruptcy Court for the Northern District of Illinois to hire Fisher Auction Company. The Debtors need an auctioneer to market and sell their properties, including a real property in Chicago where they operate a car wash business and personal properties used to operate the business. The firm is entitled to a fee upon the actual closing of a sale, which is paid by the buyer, through a 10 percent buyer's premium that is added to the final bid price. The Debtors will pay up to $12,000 in promotional funds advanced for a marketing campaign budget. Lamar Fisher, president and chief executive officer of Fisher Auction Company, disclosed in a court filing that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Lamar Fisher Fisher Auction Company 2112 East Atlantic Boulevard Pompano Beach, FL 33062 Phone: (954) 942-0917 Fax: (954) 782-8143 Email: info@fisherauction.com About APP Realty and APP Car Wash APP Realty, LLC, a Chicago-based company, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 21-03839) on March 24, 2021. The case is jointly administered with the Chapter 11 case filed by an affiliate, APP Car Wash, LLC, on May 20, 2021 (Bankr. N.D. Ill. Case No. 21-06550). Judge Lashonda A. Hunt oversees the cases. At the time of the filing, APP Realty had total assets of $1,226,027 and total liabilities of $1,028,763. Meanwhile, APP Car Wash disclosed total assets of up to $1 million and total liabilities of up to $10 million. Joyce W. Lindauer Attorney, PLLC and Bauch & Michaels, LLC serve as the Debtors' bankruptcy counsel and local counsel, respectively. APP REALTY: Seeks to Employ Bauch & Michaels as Local Counsel ------------------------------------------------------------- APP Realty, LLC and APP Car Wash, LLC seek approval from the U.S. Bankruptcy Court for the Northern District of Illinois to hire Bauch & Michaels, LLC to serve as local counsel in their Chapter 11 cases. The Debtors need a local counsel to: (a) give legal advice with respect to the powers and duties of the Debtors in the continued operation of their business and management of their properties; (b) assist in the negotiation, preparation and filing of documents in connection with the sale of the Debtors' properties or the refinancing of claims; (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, negotiations concerning all litigation in which the Debtors are or become involved, and the evaluation and objection to claims filed against the estates; (d) assist in the preparation of legal papers and appear on behalf of the Debtors at court hearings; and (e) provide other necessary legal services. The firm's hourly rates are as follows: Paul M. Bauch, Esq. $400 per hour Kenneth A. Michaels Jr., Esq. $375 per hour Carolina Y. Sales, Esq. $275 per hour Associates $150 - $195 per hour Paralegals $60 - $125 per hour On Feb. 25, the Debtors paid $5,258.25 to Bauch & Michaels as a retainer fee. Paul Bauch, Esq., at Bauch & Michaels, disclosed in a court filing that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached at: Paul M. Bauch, Esq. Bauch & Michaels, LLC 53 West Jackson Boulevard, Suite 1115, Chicago, IL 60604 Phone: (312) 588-5000 Fax: (312) 427-5709 Email: pbauch@bmlawllc.com About APP Realty and APP Car Wash APP Realty, LLC, a Chicago-based company, sought protection under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 21-03839) on March 24, 2021. The case is jointly administered with the Chapter 11 case filed by an affiliate, APP Car Wash, LLC, on May 20, 2021 (Bankr. N.D. Ill. Case No. 21-06550). Judge Lashonda A. Hunt oversees the cases. At the time of the filing, APP Realty had total assets of $1,226,027 and total liabilities of $1,028,763. Meanwhile, APP Car Wash disclosed total assets of up to $1 million and total liabilities of up to $10 million. Joyce W. Lindauer Attorney, PLLC and Bauch & Michaels, LLC serve as the Debtors' bankruptcy counsel and local counsel, respectively. ARBORETUM CROSSING: Case Summary & 10 Unsecured Creditors --------------------------------------------------------- Debtor: Arboretum Crossing LLC 814 Lavaca Street Austin, TX 78701 Business Description: Arboretum Crossing LLC is primarily engaged in renting and leasing real estate properties. Chapter 11 Petition Date: July 6, 2021 Court: United States Bankruptcy Court Western District of Texas Case No.: 21-10546 Debtor's Counsel: Mark H. Ralston, Esq. FISHMAN JACKSON RONQUILLO PLLC 13155 Noel Road, Ste. 700 Dallas, TX 75240 Tel: (972) 419-5544 Email: mralston@fjrpllc.com Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by Natin Paul, authorized agent. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/EFWT63Y/Arboretum_Crossing_LLC__txwbke-21-10546__0001.0.pdf?mcid=tGE4TAMA List of Debtor's 10 Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Cupertino Builders, LLC $103,927 1159 Sonora Ct Suite 202 Sunyvale, CA 94086 2. West Texas Stone $69,650 Solutions 5206 Orsini Blfs Round Rock, TX 78665 3. Ahern Rentals, Inc. Unknown 8350 Eastgate Road Henderson, NV 89015 4. City of Austin $12,901 PO Box 2267 Austin, TX 78783-2267 5. Alliance Tax Advisors $12,330 433 E Las Colinas Blvd Suite 300 Irving, TX 75039 6. North by Northwest LLC $2,417 3801 Prarie Ln Austin, TX 7872 7. Inoca Holdco II, LLC $1,914 FCS Fox Commerical Services LLC PO Box 19047 Austin, TX 78760 8. Yoga Pod $11,308 JMH Yogi, LLC 1817 Chalk Rock Cove Austin, TX 78735 9. TSO Delivery, LLC $3,777 3909 N Interstate 35 Suite E-5 Austin, TX 78722 10. Skin Zen LLC $3,227 2006 Autumn Fire Cedar Park, TX 78613 ARS REI: Unsecured Claims to be Paid in Full Under Plan ------------------------------------------------------- ARS REI USA Corp., d/b/a UNOde50, submitted a Second Amended Disclosure Statement explaining its Chapter 11 Plan. The Plan provides for a reorganization of the Debtor's financial affairs. Under the Plan, all Statutory Fees, Administrative Claims, Secured Claims, Priority Tax Claims and General Unsecured Claims will be fully paid. ARS REI S.L. shall retain its Interests (i.e., equity) in the Debtor/Post-Confirmation Debtor. The Plan will be implemented through, and the Distributions contemplated to be made under the Plan will be funded by, revenue generated from Debtor's operations. Counsel to the Debtor: Jeffrey A. Reich Reich, Reich & Reich, P.C. 235 Main Street, Suite 450 White Plains, New York 10601 Tel: (914) 949-2126 E-mail: jreich@reichpc.com A copy of the Disclosure Statement is available at https://bit.ly/3w6SjLm from PacerMonitor.com. About ARS REI USA Corp. ARS REI USA Corp. is in the business of selling handcrafted jewelry manufactured in Madrid, Spain by ARS REI S.L., exclusively in the United States. ARS REI USA Corp. filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 20-11937) on Aug. 19, 2020, In the petition signed by Jason McNary, CEO, the Debtor disclosed $4,248,640 in assets and $3,904,607 in liabilities. Judge Martin Glenn presides over the case. Jeffrey A. Reich, Esq. at REICH REICH & REICH, P.C., is the Debtor's counsel, and Raich Ende Malter & Co. LLP is its accountant. ATI PHYSICAL: S&P Assigns 'B' Issuer Credit Rating, Outlook Stable ------------------------------------------------------------------ S&P Global Ratings raised the issuer credit rating on ATI Holdings Acquisition Inc. to 'B' from 'B-' and removed its ratings from CreditWatch, where S&P placed them with positive implications when the SPAC deal was announced on Feb. 22, 2021. Bolingbrook, Ill.-based physical therapy and rehabilitation service provider ATI Holdings Acquisition Inc.'s parent company, Wilco Holdco Inc., has completed its merger with publicly traded special-purpose acquisition company (SPAC) Fortress Value Acquisition Corp. II (FVAC II), which was subsequently renamed ATI Physical Therapy Inc. (the company). S&P said, "At the same time, we are raising our issue-level rating on the first-lien debt, issued by wholly owned subsidiary ATI Holdings Inc., to 'B' and affirming the recovery rating of '3'. We are also withdrawing ratings on the second-lien debt, which has been fully repaid. "We are also assigning a 'B' issuer credit rating to the new parent company ATI Physical Therapy Inc. "The stable outlook reflects our view that the recent debt reduction and gradual rebound of patient visit volumes will enable the company to maintain credit measures appropriate for the 'B' rating, including adjusted debt to EBITDA below 7x on a sustained basis. "The upgrade reflects the significant debt reduction following the SPAC-merger transaction, as well as prospects for improving EBITDA and cash flow generation. We expect the stronger balance sheet will support the company's ability to execute on its growth strategy. Upon close of the transaction, the company repaid its second-lien term loan in full, and a portion of its first-lien term loan, resulting in gross debt of $561 million upon close of the transaction. We believe the lower annual interest expense due to debt reduction will improve the company's ability to fund its growth plans from internally generated cash flows. We expect adjusted debt to EBITDA in the 6x to 7x range in 2021, and improving to below 5x in 2022 as the company sees patient visit volumes return to pre-pandemic levels by the end of 2021. "We believe that although patient visit volumes remain below pre-pandemic levels as of the first quarter of 2021, the company weathered the worst of the related fallout in 2020 and should see further patient visit volume gains over the course of 2021. ATI's revenue suffered most from the pandemic during the months of March through June of 2020, with visits bottoming at below 50% of normal volumes in April due to government mandated lockdowns. The company navigated this period through a combination of actions including cost reductions and temporary employee furloughs, and the launch of telehealth services. The company also received various forms of financial assistance, most notably a $91.5 million CARES Act grant and about $27 million in Medicare advance payments. We do not believe the CARES Act monies need to be returned, though the $27 million in Medicare advance payments will have an impact on cash flows in 2021 as services are rendered to Medicare patients. The company also drew on its revolver as a precautionary measure during the first half of 2020, and subsequently repaid the balance in full in June 2020. "We expect ongoing gains in patient volume per day over the course of 2021. After bottoming below 50%, the business recovered to 76% for the fourth quarter of 2020, and has since grown to 83% as of the end of the first quarter. We believe that pandemic-related risks have significantly declined in recent months as vaccination rates have increased across the U.S. and COVID-19 cases have declined. This should lead to continued positive momentum on the patient visit front. "We expect revenue to grow about 20% in 2021, benefitting from a rebound in patient volumes from depressed 2020 levels, organic same-store sales growth, and investment in de novo clinics. We expect robust growth in both 2021 and 2022, as the lingering impacts from the pandemic subside and volumes return to historical levels. We expect a portion of this recovery will not be realized until 2022, as there have been modestly depressed volumes during the first half of this year due to lingering repercussions from the pandemic as well as a tight labor market that could constrain near-term growth. We believe that from a longer-term perspective independent from the recent pandemic-related disruption to demand patterns, the physical therapy market should grow by a low- to mid-single digit percentages, benefitting from demographic changes as an aging U.S. population will continue to rely on these services. The company also had about $98 million of cash on hand as of March 31, 2021 that it will likely utilize to fund moderate-size acquisitions and a slightly accelerated pace of de novo expansion, further driving future sales and EBITDA growth. "We continue to view the company as highly leveraged and financial sponsor owned, which may lead to aggressive financial policies, but with improved credit measures due to the recent debt reduction. We recognize the company is now a publicly traded company and is therefore likely to operate the business with a lower amount of debt leverage, and that the debt reduction concurrent with the SPAC-merger transaction is evidence of this. However, we also recognize that financial sponsor Advent International continues to hold an ownership stake above our 40% threshold for recognition as a financial sponsor owned company. We therefore continue to assess the company's financial risk and financial policies from the perspective of a financial sponsor-owned company. We believe the company will continue to aggressively pursue inorganic growth opportunities including investments in de novo clinics primarily within existing regions as well as mergers and acquisitions to potentially expand to new regions. "The stable outlook on ATI Physical Therapy Inc. reflects our view that the company is positioned to maintain debt leverage below 7x while funding the majority of its growth plans from internally generated cash flow. We expect the company's patient visit volumes to continue recovering to near pre-COVID-19 levels by the end of 2021. "We could consider lowering our rating on ATI over the next 12 months if leverage increases above 7x on a sustained basis with limited prospects for improvement. This could occur if a combination of factors lead to weaker-than-expected earnings, such as a slower-than-expected ramp-up of patient visit volumes or higher-than-expected acquisition and integration costs. This could occur if pandemic risks increase due to a new variant affecting one or more of ATI's regional markets. We could also lower the rating if the company pursues aggressive debt-funded inorganic growth opportunities, leading to a similar increase in leverage. "We could raise our ratings on ATI if the company reduces adjusted debt leverage to below 5x while improving the ratio of free cash flow to debt above 5% and if we believe that the company is committed to leverage at such levels even after taking into account potential inorganic growth opportunities. This could occur if the company executes its growth strategy successfully, sees patient visit volumes recover to near pre-pandemic levels, and establishes a track record of consistent free cash flow generation after growth capital spending. Before upgrading the company, we would also need to see evidence that the improvement in debt leverage is sustainable." ATLANTIC AVIATION: S&P Downgrades ICR to 'B' on Leveraged Buyout ---------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on Atlantic Aviation FBO Inc. by one notch to 'B' from 'B+'. KKR Apple Bidco LLC will issue new debt related to KKR & Co's $4.475 billion leveraged buyout (LBO) of Plano, Texas-based provider of fuel, terminal, aircraft hangaring, and other aviation services Atlantic Aviation. The company expects the transaction to close in the second half of 2021. Pro forma for the transaction, S&P Global Ratings-adjusted leverage will increase to the mid-7x area from the low-5x area. S&P said, "At the same time, we assigned our 'B' issuer credit rating to the new borrower in the proposed transaction, KKR Apple Bidco LLC. Following completion of the sale, we expect to maintain our ratings on KKR Apple Bidco LLC and withdraw our ratings on Atlantic Aviation FBO Inc. "We also assigned our 'B+' issue-level rating and '2' recovery rating to KKR Apple Bidco LLC's proposed first-lien credit facility, which will include a $225 million revolving credit facility due 2026 and a $1.3 billion first-lien term loan due 2028, and our 'CCC+' issue-level and '6' recovery rating to the proposed $350 million second-lien term loan due 2029. "The stable outlook reflects our expectation that business and general aviation activity will continue to recover steadily, supporting low-teens-percent area gross profit growth in 2021 and over 200 basis points (bps) of adjusted EBITDA margin expansion (as a share of gross profit) to about 56%. We expect this will result in adjusted leverage declining to the high-6x area in 2022 from over 7x pro forma for the transaction." The transaction financing will result in leverage exceeding 6x over the next two to three years. Following the LBO, Atlantic's debt burden will increase by about $650 million with pro forma S&P Global Ratings-adjusted leverage increasing to the mid-7x area (from the low-5x area). S&P said, "Our adjusted leverage calculation capitalizes operating leases and nets all unrestricted cash. We expect leverage will decline modestly to the high-6x area in 2022 and to the low-6x area in 2023 as general aviation activity steadily recovers. However, we believe the company may look to broaden its geographic footprint of airports through debt-funded acquisitions, which could delay deleveraging as Atlantic continues to develop its fixed-base operator (FBO) network (69 North American sites) to increase competition with market leader Signature Aviation PLC. (131 North American sites and 179 globally). While our base case forecast includes no specific assumptions around site acquisitions, we expect the terms of the credit agreement will provide sufficient incremental capacity for the company to pursue its strategic growth initiatives." The company has grown and optimized its network to 69 locations currently from 16 locations in 2004 through strategic acquisitions and dispositions. Industry acquisition multiples for stand-alone locations are likely in the high-single-digit area pro forma for synergies, which could keep leverage elevated. S&P said, "We forecast Atlantic's cash flow metrics will weaken over the next 18 months. We expect the company's free operating cash flow (FOCF) to debt (adjusted for LBO transaction expenses) will decline to the low-to-mid-single-digit percent area in 2021 and 2022, from the low-teens area in 2019 and 2020, due to the increasing interest expense and increased investment into pandemic-delayed capital expenditure (capex) required to maintain and upgrade its airport network. "Atlantic demonstrated near-term flexibility in its capex during difficult operating conditions in 2020, reducing investment by 43.6% year-on-year, but we believe the company must ultimately invest to maintain or improve its ground equipment, refueling trucks, fuel storage facilities, and hangars in order to secure its airport lease renewals and maintain its scale and market leadership, which are key competitive advantages, in our view. "We expect the company will need to draw on its revolving credit facility to fund non-recurring expenses, including the LBO transaction costs. We expect the company to reduce its revolving credit facility balance outstanding starting in 2023 through steady earnings and operating cash flow growth and a decline in these non-recurring charges. "We view KKR as an infrastructure fund with a long-term investment horizon, rather than a private equity financial sponsor, which supports our assessment of financial policy risk. While KKR is a private equity firm, its investment in Atlantic Aviation comes from its infrastructure investment arm. We understand the expected investment holding period of KKR's infrastructure investments is meaningfully longer than its private equity investments. Furthermore, the significant cash equity contribution supporting the LBO (65%) demonstrates KKR's long-term commitment to the company. That said, our assessment reflects the company's high leverage risk tolerance and the risk that discretionary cash flows after investment in the company are prioritized for shareholder distributions over debt repayment in order to de-risk KKR's large equity investment. "We view Atlantic's leading market position and significant entry barriers favorably. Atlantic operates the second-largest network in the highly fragmented North American FBO market through its 69 U.S. locations, including 10 locations at the 20 busiest U.S. airports. This compares with market leader Signature Aviation PLC., which operates 131 North American locations, including 37 locations at the top 50 business and general aviation airports in the U.S. We expect meaningful scale benefits will accrue to the industry's market leaders, which can leverage their network for scale economies for fuel procurement, insurance purchases, and pilot incentive programs. Atlantic's market position is well protected by long-dated (about 20 years weighted-average based on 2019 EBITDA) leaseholds at the airports in which it operates and by the limitations on physical space on airport runways and the high up-front capital costs required for would-be competitors to establish competing locations. While the company is exposed to the cyclicality in demand for aviation fuel, its well-diversified customer base and the high proportion of gross profit related to high-margin, non-discretionary non-fuel services supports visibility into earnings and cash flow, in our view. "We expect Atlantic's operating performance will continue to stabilize; however, uncertainty remains around the timing and extent of recovery and long-term growth prospects for business travel. Following a sharp decline (of roughly 80% year on year) in general aviation activity at the airports in which the company operates in April 2020, a sharp rebound industry-wide in private air travel drove a recovery in general aviation activity at Atlantic's locations to roughly 80% of the previous year's levels by the third quarter of 2020 and to year-on-year growth of 5% in the first quarter of 2021. The company generated positive FOCF on a quarterly basis through 2020, due to the stability of non-fuel services revenue, including long-term hangar rentals, management's cost actions, working capital declines, and a decline in floating-rate interest expense. We forecast Atlantic's operating performance will remain stable going forward; however, due to the growing adoption of videoconference technology through the pandemic, uncertainty remains around the pace of recovery in business travel, to which the company's exposure is modestly skewed. Business travel has recovered more slowly than leisure travel, and as a result, the recovery in general aviation activity at the airports where Atlantic operates has modestly lagged the broader industry. "The stable outlook reflects our expectation that business and general aviation activity will continue to recover steadily, supporting low-teens percent area gross profit growth in 2021 and over 200 bps adjusted EBITDA margin expansion (as a share of gross profit) to about 56%. We expect this will result in adjusted leverage declining to the high-6x area in 2022 from over 7x pro forma for the transaction." S&P could lower its ratings on Atlantic if adjusted leverage exceeded the mid-7x on a sustained basis or FOCF to debt remained in the low-single-digit percent area. This could occur with: -- A severe decline in general aviation activity due to a resurgence of the COVID-19 pandemic; -- High volatility in fuel prices that depresses business jet utilization; -- Government regulations that unexpectedly limit Atlantic's operations, pricing policies, or industry economics; or -- A more aggressive financial policy that includes large debt-funded shareholder returns or leveraging acquisitions. S&P said, "We could consider raising our ratings on Atlantic if it sustained adjusted leverage of less than 6.5x with free operating flow to debt above 5%. We could also consider an upgrade if the company meaningfully expanded its airport network and increased market share." AULT GLOBAL: Adjourns Annual Meeting to July 23 ----------------------------------------------- Ault Global Holdings, Inc.'s annual meeting of stockholders scheduled as a virtual meeting format only, on July 6, 2021 at 9:00 a.m. PT. was adjourned due to lack of a quorum. There will be no change to the record date for the Meeting of May 27, 2021. Based on the absence of quorum, the Company elected to adjourn the Meeting until 9:00 a.m. (Pacific Time) on July 23, 2021 for the purpose of allowing additional time for stockholders to vote on the Proposals contained in the Proxy Statement dated June 7, 2021. As described in the Proxy Statement, the Meeting will be held for the following purposes: * To elect the eight director nominees named in the Proxy Statement to hold office until the next annual meeting of stockholders; * To ratify the appointment of Marcum LLP, as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2021; * To approve, pursuant to Rule 713 of the NYSE American, the exercise of warrants issued to Esousa Holdings, LLC and two individuals, to purchase up to an aggregate of 3,850,220 shares of the Company's common stock, issued in connection with certain term promissory notes in an aggregate amount of up to $5,300,000, in order to comply with the listing rules of the NYSE American; * To approve the Ault Global Holdings, Inc. 2021 Stock Incentive Plan; * To approve the Ault Global Holdings, Inc. 2021 Employee Stock Purchase Plan; * To approve the 2020 equity issuances to directors and executive officers of the Company, in order to comply with the listing rules of the NYSE American; * To approve the 2021 equity issuances to directors and executive officers of the Company, in order to comply with the listing rules of the NYSE American; and * The transaction of such other business as may properly come before the Annual Meeting or any adjournments or postponements thereof. A quorum consists of a majority of the shares entitled to vote. There were fewer than a majority of shares entitled to vote present, either in person or by proxy at the Meeting. The Meeting therefore had no quorum and was therefore adjourned. To access the virtual meeting please click the Virtual Shareholder Meeting link: www.meetingcenter.io/281807556. To login to the virtual meeting you have two option: Join as a "Guest" or Join as a "Shareholder". If you join as a "Shareholder" you will be required to have a control number and password. The password for the meeting is DPW2021. About Ault Global Holdings, Inc. Ault Global Holdings, Inc. (fka DPW Holdings, Inc.) is a diversified holding company pursuing growth by acquiring undervalued businesses and disruptive technologies with a global impact. Through its wholly and majority-owned subsidiaries and strategic investments, the Company provides mission-critical products that support a diverse range of industries, including defense/aerospace, industrial, telecommunications, medical, and textiles. In addition, the Company extends credit to select entrepreneurial businesses through a licensed lending subsidiary. Ault Global reported a net loss of $32.73 million for the year ended Dec. 31, 2020, compared to a net loss of $32.94 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $234.03 million in total assets, $57.56 million in total liabilities, and $176.47 million in total stockholders' equity. BEAR COMMUNICATIONS: Has Access to Cash Collateral Thru July 26 --------------------------------------------------------------- Judge Dale L. Somers authorized Bear Communications, LLC to use cash collateral through July 26, 2021, to pay the operating expenses of its business, in accordance the approved budget. The Court authorized the Debtor to grant Central Bank of the Midwest and the U.S. Small Business Administration, in addition to the adequate protection payments provided for in the approved budget, additional replacement security interest and lien in the same priority existing on the Petition Date to the extent each party holds a prepetition valid, enforceable, and perfected security interest in the Debtor's prepetition cash collateral, in the same categories of assets acquired by the Debtor post‐petition in which the Bank and the SBA had pre‐petition security interests and only to the extent any cash collateral is diminished post‐petition together with any proceeds thereof. Both the Bank and the SBA shall be treated as oversecured creditors based solely on the total value of the Debtor's prepetition assets as listed in the Debtor's voluntary petition, for purposes of the interim order, and such assumption shall not be an admission of fact, and is not binding on any party‐in‐interests' right to seek to contest the priority, validity amount, and secured status of any prepetition security and liens granted by the Debtor to the Bank or the SBA. The adequate protection payments made to the Bank and the SBA will be disgorged for the benefit of the Debtors' unsecured creditors if the Court or the parties later determine that the Debtor's adequate protection payments made to the Bank and/or the SBA were made on account of undersecured prepetition indebtedness. Creditors, Advanced Business Capital, d/b/a Triumph Business Capital; Eagle Capital Corporation; and The Guarantee claimed no interest in the cash collateral. The Bank and the SBA reserve their rights to assert superpriority claims pursuant to Sections 503(b) and 507(b) of the Bankruptcy Code in the event a claim arise from the diminution in value of their Cash Collateral. A copy of the order is available for free at https://bit.ly/3Avn1RS from PacerMonitor.com. A final hearing on the motion shall commence on July 19, 2021 at 11 a.m. Counsel for Central Bank of The Midwest: Paul M. Croker, Esq. Erin M. Edelman, Esq. Armstrong Teasdale LLP 2345 Grand Blvd., Ste. 1500 Kansas City, MO 64108‐2617 Telephone: (816) 221‐3420 Facsimile: (816) 221‐0786 Email: pcroker@atlllp.com eedelman@atllp.com Counsel for the U.S. Small Business Association: Brian D. Sheern, Esq. Duston J. Slinkard, Esq. Acting U.S. Attorney, District of Kansas The United States Attorney's Office District of Kansas United States Department of Justice 301 N. Main St., Ste. 1200 Wichita, KS 67202‐4812 Telephone: (316) 269‐6481 Facsimile: (316) 269‐6484 Email: brian.sheern@usdoj.gov Counsel for Advanced Business Capital, d/b/a Triumph Business Capital: Michael D. Fielding, Esq. Husch Blackwell LLP 4801 Main St., Ste. 1000 Kansas City, MO 64112 Telephone: (816) 983-8000 Facsimile: (816) 983-8080 Email: michael.fielding@huschblackwell.com - and - Jared A. Ullman, Esq. Ullman & Ullman, P.A. Telephone: (561) 338-3535 ext. 115 Facsimile: (561) 338-3581 Email: jared.ullman@uulaw.net About Bear Communications Lawrence, Kan.-based Bear Communications, LLC -- http://www.bearcommunications.net-- is a communications contractor offering aerial construction, underground construction, splicing, subscriber drop placement, residential and commercial installations, residential/commercial wiring, consulting, and testing services. Bear Communications filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Kansas Case No. 21-10495) on May 28, 2021. At the time of the filing, the Debtor disclosed total assets of up to $50 million and total liabilities of up to $100 million. Judge Dale L. Somers presides over the case. W. Thomas Gilman, Esq., at Hinkle Law Firm LLC, represents the Debtor as legal counsel. BELK INC: Appoints New CEO Months After Leaving Bankruptcy ---------------------------------------------------------- Belk on July 6, 2021, announced several promotions within the company's senior leadership, most notably the promotion of Nir Patel to CEO. Lisa Harper, who served as Belk's CEO dating back to July 2016, has transitioned to Executive Chair of the Belk Board of Directors. Patel's promotion sees him moving from President and Chief Merchandising Officer to CEO effective today. "I am extremely thankful to all of our associates and customers at Belk for making my last five years here so meaningful," Harper said. "To think that one of my very first jobs started at my local Belk store, and then my career allowed me to come full circle serving as the CEO, has truly been an honor. I'm incredibly proud of everything we have accomplished together over the years as we worked to evolve our company and give our customers the very best products and services that they deserve. I look forward to watching how Belk will continue to transform the shopping experience for years to come." Patel joined Belk in 2016 as EVP, GMM, Men's and eCommerce where he also expanded his responsibilities to include Home, Kids, and Visual Merchandising before he was promoted to Chief Merchandising Officer in 2018. Patel was then named President in 2020 as he assumed the additional responsibilities for Marketing and eCommerce. Prior to his years at Belk, Patel was an SVP with Kohl's, a VP at Land's End, and worked for Abercrombie & Fitch, Target, and Gap Inc. "I'm honored to continue the great legacy of Belk," Patel stated. "We quickly adapted to the challenges the pandemic threw at us this past year. I'm proud of our team's ability to stay focused on what really matters to our customers - having the best products and making their shopping experience safe and seamless. We've accomplished so much already, and I'm excited to see all the ways that we'll continue to grow." Along with the CEO change, Belk also announced that Don Hendricks will be promoted from Chief Operating Officer to President. The company also hired Chris Kolbe as EVP, Chief Merchandising Officer. Hendricks came to Belk in 2016, joining the organization as Chief Operating Officer, and then added Stores to his responsibilities in 2019. A proven leader, Hendricks previously worked at Gymboree, Hot Topic and Torrid having several leadership roles within those organizations, including CIO and Chief Operating Officer. Kolbe joins the organization as EVP, Chief Merchandising Officer bringing 30 years of experience, including senior leadership roles, working for Kohl's, Land's End, Original Penguin, and Urban Outfitters throughout his career. In his new role, Kolbe will lead the Merchandising, Product Design and Sourcing teams for Belk. About Belk Inc. Belk Inc. operates a private department store chain headquartered in Charlotte, N.C. Since opening in 1888 as a single small bargain store in Monroe, N.C., Belk and its affiliates have strategically grown to 291 stores spread throughout 16 states. The Debtors offer a strong e-commerce platform and employ approximately 17,000 associates. Belk and its affiliates concurrently filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 21-30630) on Feb. 21, 2021. William R. Langley, chief financial officer, signed the petitions. In the petitions, Belk disclosed assets of between $1 billion and $10 billion and liabilities of the same range. Judge Marvin Isgur oversees the cases. The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis International LLP as bankruptcy counsel, Jackson Walker LLP as local counsel, Alvarez & Marsal North America, LLC as financial advisor, and Lazard Freres & Co. LLC as investment banker. Prime Clerk LLC is the claims and noticing agent. BERRY GLOBAL: Moody's Hikes CFR to Ba1, Outlook Stable ------------------------------------------------------ Moody's Investors Service upgraded Berry Global Group Inc.'s Corporate Family Rating to Ba1 from Ba3 and Probability of Default Rating to Ba1-PD from Ba3-PD. Moody's also upgraded the ratings on Berry Global Inc. (a subsidiary of Berry Global Group Inc.) first lien senior secured term loan and notes to Ba1 from Ba2 and the rating on the company's second lien senior secured notes to Ba2 from B2. The outlook for Berry is stable. Finally, Moody's upgraded Berry's Speculative Grade Liquidity Rating to SGL-1 from SGL-2. The upgrade of the CFR reflects Moody's expectation that Berry's debt to LTM EBITDA will decline to 4.0x by the end of 2022 from 4.7x at April 3, 2021. The decline in leverage will be driven primarily by the dedication of free cash flow to debt reduction. Free cash flow to debt is also expected to improve to over 10.0% from 8.7%. The stable outlook reflects Moody's expectation that Berry will dedicate free cash flow to debt reduction over the next 18 months and improve credit metrics. The one notch upgrade of the rating on the company's 1st lien senior secured term loan and notes, despite the two notch upgrade in the CFR, reflects the reduction in second lien debt that would absorb losses ahead of first lien creditors. The three notch upgrade in the second lien senior secured facilities reflects the improvement in recovery expectations given the significant reduction in the amount of second lien debt in the capital structure. Moody's expects Berry to continue to repay higher coupon second lien debt or refinance it with cheaper first lien debt over the next 18 months. The upgrade of the Speculative Grade Liquidity Rating to SGL-1 from SGL-2 reflects Moody's expectation of very good liquidity, characterized by strong free cash flow, a significant amount of cash on hand and good cushion under the financial covenant. Upgrades: Issuer: Berry Global Group Inc. Corporate Family Rating, Upgraded to Ba1 from Ba3 Probability of Default Rating, Upgraded to Ba1-PD from Ba3-PD Speculative Grade Liquidity Rating, Upgraded to SGL-1 from SGL-2 Issuer: Berry Global Inc. Senior Secured First Lien Bank Credit Facility, Upgraded to Ba1 (LGD3) from Ba2 (LGD3) Senior Secured Second Lien Regular Bond/Debenture, Upgraded to Ba2 (LGD5) from B2 (LGD5) Senior Secured First Lien Regular Bond/Debenture, Upgraded to Ba1 (LGD3) from Ba2 (LGD3) Outlook Actions: Issuer: Berry Global Group Inc. Outlook, Remains Stable Issuer: Berry Global Inc. Outlook, Remains Stable A List of Affected Credit Ratings is available at https://bit.ly/3dOPngo RATINGS RATIONALE Strengths in Berry's credit profile include its considerable scale (revenue), a concentration of sales in relatively stable end markets (food and healthcare), and strong free cash generation. Berry is the largest rated packaging manufacturer by revenue and has 75% of its customer business under long-term contracts with cost pass-through provisions (raises customer switching costs and protects against increases in volatile raw material costs). Weaknesses in Berry's credit profile include some exposure to more cyclical end markets and lengthy lags in contractual cost pass-through mechanisms with customers (leaving the company exposed to changes in volumes before increases in raw material prices can be passed through). Berry operates in the fragmented and competitive packaging industry which has many private, unrated competitors and strong price competition. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS A ratings upgrade would require a commitment to an investment grade financial profile and capital structure. An upgrade would also be dependent upon a sustainable improvement in credit metrics and a stable competitive environment. Specifically, the ratings could be upgraded if: Adjusted debt to LTM EBITDA is approaching 3.5x Adjusted EBITDA margin is approaching 20.0% Free cash flow to debt is above 12.0% The ratings could be downgraded if there is deterioration in credit metrics, the competitive environment or liquidity. Additionally, the ratings could be downgraded if there is a large, debt financed acquisition. Specifically, the ratings could be downgraded if: Adjusted debt to LTM EBITDA is above 4.25x Adjusted EBITDA margin is below 17.0% Free cash flow to debt is below 8.0% The principal methodology used in these ratings was Packaging Manufacturers: Metal, Glass and Plastic Containers Methodology published in September 2020. Based in Evansville, Indiana, Berry Global Group Inc. (NYSE: BERY) is a manufacturer of both rigid and flexible plastic packaging products. Net sales for the twelve months ended April 3, 2021 totaled approximately $12.4 billion. BRAZOS ELECTRIC: Seeks Approval to Hire Special Litigation Counsel ------------------------------------------------------------------ Brazos Electric Power Cooperative, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ Ted B. Lyon & Associates, The Gallagher Law Firm, West & Associates LLP, Butch Boyd Law Firm and Boyd Smith Law Firm, PLLC as its special litigation counsel. The firms will represent the Debtor on a contingent fee basis in connection with analyzing and potentially pursuing certain causes of action it may have against suppliers and related parties that arose in conjunction with the events during and following the winter storm event in February 2021 known as "Winter Storm Uri." Pursuant to their agreement with the Debtor, Ted B. Lyon & Associates, The Gallagher Law Firm and West & Associates will receive as fees one-third of the value of any settlement, judgment or other recovery, in whole or in part. The three law firms have agreed to divide the contingency fee as follows: Ted B. Lyon & Associates 37.5 percent The Gallagher Law Firm 37.5 percent West & Associates 25 percent The Gallagher Law Firm has also entered into an agreement to share with Butch Boyd and Boyd Smith its 37.5 percent share of the contingency fee as follows: The Gallagher Law Firm 50 percent Butch Boyd 25 percent Boyd Smith 25 percent In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, the law firms disclosed that: -- They have not agreed to any variations from, or alternatives to, their standard or customary billing arrangements for this engagement; -- None of the professionals included in the engagement vary their rate based on the geographic location of the bankruptcy case; -- The firms have not represented the Debtor in the 12 months prior to its bankruptcy filing; and -- The firms will periodically review staffing and budget issues with the Debtor and coordinate with its other professionals to ensure there is no duplication of efforts. The firms also disclosed in court filings that they are "disinterested" within the meaning of Section 101(14) of the Bankruptcy Code. The firms can be reached through: Ted. B. Lyon, Esq. Ted B. Lyon & Associates 18601 Lyndon B Johnson Fwy, Suite 525 Mesquite, TX 75150 Phone: 866-503-4864 (Toll Free) 972-279-6571 (Local) Fax: 972-279-3021 -- and -- Michael T. Gallagher, Esq. The Gallagher Law Firm 2905 Sackett St. Houston, TX 7098 Phone: 888-222-7052 (Toll Free) 713-222-8080 (Local) -- and -- Royce B. West, Esq. West & Associates, LLP 320 S. RL Thornton Freeway Service Rd # 300 Dallas, TX 75203 Phone: 214-941-1881 Fax: 214-941-1399 Email: royce.w@westllp.com -- and -- Butch Boyd, Esq. Butch Boyd Law Firm 2905 Sackett St. Houston, TX 77098-1127 Phone: 713-589-8477 Fax: 713-589-8563 -- and -- Boyd Smith, Esq. Boyd Smith Law Firm, PLLC 2905 Sackett St. Houston, TX 77098-1127 Phone: 713.589.8477 Fax: 713.589.8563 Brazos Electric Power Cooperative Brazos Electric Power Cooperative Inc. is a 3,994-megawatt transmission and generation cooperative which members' service territory covers 68 counties from the Texas Panhandle to Houston. It was organized in 1941 and the first cooperative formed in the Lone Star state with the primary intent of generating and supplying electrical power. At present, Brazos Electric is the largest generation and transmission cooperative in the state and is the wholesale power supplier for its 16 member-owner distribution cooperatives and one municipal system. Brazos Electric filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas Case No. 21-30725) on March 1, 2021. At the time of the filing, the Debtor disclosed assets of between $1 billion and $10 billion and liabilities of the same range. Judge David R. Jones oversees the case. The Debtor tapped Norton Rose Fulbright US, LLP as bankruptcy counsel, Foley & Lardner LLP and Eversheds Sutherland US LLP as special counsel, Collet & Associates LLC as investment banker, and Berkeley Research Group, LLC as financial advisor. Ted B. Lyon & Associates, The Gallagher Law Firm, West & Associates LLP, Butch Boyd Law Firm and Boyd Smith Law Firm, PLLC serve as special litigation counsel. Stretto is the claims and noticing agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtor's case on March 15, 2021. The committee is represented by the law firms of Porter Hedges, LLP and Kramer, Levin, Naftalis & Frankel, LLP. FTI Consulting, Inc. and Lazard Freres & Co. LLC serve as the committee's financial advisor and investment banker, respectively. BULLFROG LOGISTICS: Hits Chapter 11 Bankruptcy Protection --------------------------------------------------------- Matt Narvaiz of Albuquerque Business First reports a Carlsbad, New Mexico-based company is in the process of rebuilding after filing for bankruptcy last June 2021. The company, Bullfrog Logistics LLC, works with transporting fluids in the oil and gas sector — particularly the transportation of drilling mud, brine water and fresh water — owner Jeff McWhorter told Albuquerque Business First. The company filed for Chapter 11 bankruptcy on June 26, 2021 with the District of New Mexico, according to the bankruptcy filing. It now is in the process of reorganizing its business to stay afloat. "If anybody thinks that filing for bankruptcy makes you feel good — you think you smile at yourself in the mirror because you file bankruptcy — well they're just wrong," McWhorter told Business First. "It's a terrible thing. It's horrible. But with us, you know, we're not filing Chapter 7. The creditors and vendors will be hurt because of the time value of money, but they will be fully repaid." McWhorter said the company filed for bankruptcy for two main reasons. One factor was the pandemic that, like for so many companies, slowed business. The second reason was the 2020 Russia-Saudi oil price war that drove the price of oil per barrel down nationwide. The company reported revenue of $6.4 million for 2020 compared to 2019’s revenue of $11.2 million, according to the bankruptcy filing. From the start of 2021 to the filing date in June, Bullfrog listed revenue at nearly $3 million. "We're just now recovering, so we're at a point where there's a demand for our services and the price that the oil company can afford to pay us is sustainable," McWhoter said. "We were able to stay in business for as long as we have because of PPP loans. Without that, it wouldn't be a Chapter 11, it'd be a Chapter 7." Bullfrog Logistics LLC listed total assets (real and personal property) at $2.8 million. Total liabilities were listed at $6.1 million. McWhorter sad the company had roughly 70 to 80 employees in 2020 and today that figure is closer to the 40 to 50 range. Bullfrog Logistics was formed in January 2015, according to the New Mexico Secretary of State's website. Bullfrog is represented in court by Dennis A. Banning of New Mexico Financial and Family Law. About Bullfrog Logistics Carlsbad, N.M.-based Bullfrog Logistics, LLC sought Chapter 11 bankruptcy protection (Bankr. D. N.M. Case No. 21-10792) on June 26, 2021. At the time of the filing, the Debtor disclosed total assets of $2,847,541 and total liabilities of $6,111,759. Judge David T. Thuma oversees the case. Dennis A. Banning, Esq., at NM Financial & Family Law, P.C., is the Debtor's legal counsel. CANNABICS PHARMACEUTICALS: Appoints New Independent Director ------------------------------------------------------------ The Board of Directors of Cannabics Pharmaceuticals Inc. has appointed Dr. Inbar Maymon Pomeranchik as an independent board member. Dr. Maymon-Pomeranchik, 43, is trained as a PhD in molecular and genetic research and brings nearly 20 years of executive level experience in biotech sciences, with particular expertise in the global medical cannabis industry. She is the founder and CEO of AgChimedes Group Ltd., a company focused on the convergence of science, innovation and investment in the field of food security; she also founded BioDiligence, a biotech investment consultancy; executive director of Ananda Developments Pls (UK), an investment and operational firm that targets medicinal cannabis derivatives for research and development; a director of NRGene (Israel), a company that develops and commercializes cutting-edge AI based genomic tools, and an Advisory Board member of Avida Global Ltd. (UK/Columbia), a leading licensed producer of pharmaceutical grade cannabis extract for scientific and medical use. Dr. Maymon-Pomeranchik holds a PhD in plants science and molecular biology from the Hebrew University (2008) and a Post Doctorate from the Weizmann Institute (2010). About Cannabics Cannabics Pharmaceuticals Inc., based in Bethesda, Maryland, is dedicated to the development and licensing of personalized cannabinoid-based treatments and therapies. The Company's main focus is development and marketing innovative bioinformatic delivery systems for cannabinoids, personalized medicine therapies and procedures based on cannabis originated compounds and bioinformatics tools. The parent Company Cannabics Inc was founded by a group of Israeli researchers from the fields of cancer research, pharmacology and molecular biology. Cannabics reported a net loss of $7.47 million for the year ended Aug. 31, 2020, compared to net income of $1.13 million for the year ended Aug. 31, 2019. As of Nov. 30, 2020, the Company had $1.70 million in total assets, $442,687 in total current liabilities, and $1.25 million in total stockholders' equity. Weinstein International. C.P.A., in Tel - Aviv, Israel, the Company's auditor since 2019, issued a "going concern" qualification in its report dated Nov. 4, 2020, citing that the Company has incurred significant losses and needs to raise additional funds to meet its obligations and sustain its operations. These conditions raise substantial doubt about the Company's ability to continue as a going concern. CARVANA CO: Unit Increases Floor Plan Facility to $1.75 Billion --------------------------------------------------------------- A subsidiary of Carvana Co., Ally Bank, and Ally Financial, had amended the Second Amended and Restated Inventory Financing and Security Agreement (the "Floor Plan Facility") to (i) increase the line of credit to $1.75 billion, and (ii) amend the LIBOR-based interest rate to a substantially similar rate tied to a prime rate, in advance of the cessation of LIBOR. About Carvana Founded in 2012 and based in Tempe, Arizona, Carvana Co. -- http://www.carvana.com-- is a holding company that was formed as a Delaware corporation on Nov. 29, 2016. Carvana is an e-commerce platform for buying and selling used cars. The Company owns and operates Carvana.com, which enables consumers to quickly and easily shop vehicles, finance, trade-in or sell the ir current vehicle to Carvana, sign contracts, and schedule as-soon-as-next-day delivery or pickup at one of Carvana's patented, automated Car Vending Machines. Carvana reported a net loss attributable to the Company of $171.14 million for the year ended Dec. 31, 2020, compared to a net loss attributable to the Company of $114.66 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $3.82 billion in total assets, $3.10 billion in total liabilities, and $721 million in total stockholders' equity. * * * As reported by the TCR on May 24, 2019, S&P Global Ratings affirmed its 'CCC+' issuer credit rating on Carvana Co. to reflect the company's improved liquidity after it raised $480 million by issuing about $230 million of common stock and a $250 million add-on to its existing senior unsecured notes due 2023. CENTER CITY : Owner Seeks Trustee to Retaliate Over Suit -------------------------------------------------------- Law360 reports that the former owner of two Philadelphia hospitals told a Delaware bankruptcy judge Wednesday, June 30, 2021, that the controlling interest holder of the debtor took control of the enterprise this week in retaliation for the debtor filing an adversary suit against him and related entities. During a virtual hearing, Center City Healthcare attorney Mark Minuti of Saul Ewing Arnstein & Lehr LLP said Joel Freedman, the ultimate owner of the debtors, filed a sealed motion early Wednesday, June 30, 2021, seeking appointment of a Chapter 11 trustee in the bankruptcy case in apparent retaliation for the debtor's suits against him and the lending institution. About Center City Healthcare Center City Healthcare, LLC, is a Delaware limited liability company that operates Hahnemann University Hospital. Its parent company is Philadelphia Academic Health System, LLC, which is also the parent company of St. Christopher's Healthcare, LLC and its affiliated physician groups. Center City Healthcare and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No. 19-11466) on June 30, 2019. At the time of the filing, the Debtors estimated assets of between $100 million and $500 million and liabilities of the same range. The cases are assigned to Judge Kevin Gross. The Debtors tapped Saul Ewing Arnstein & Lehr LLP as legal counsel; EisnerAmper LLP as restructuring advisor; SSG Advisors, LLC as investment banker; and Omni Management Group, Inc. as claims and noticing agent. CLEVELAND BIOLABS: Stockholders Approve Two Proposals at Meeting ---------------------------------------------------------------- A special meeting of stockholders of Cleveland BioLabs, Inc. was held on July 6, 2021, at which the stockholders approved the issuance of shares of common stock of the Company to securityholders of Cytocom Inc. pursuant to the terms of the Merger Agreement and the change of control resulting from the Merger. The stockholders also approved an amendment to the certificate of incorporation of the Company to effect an increase in the number of authorized shares of common stock. Because the requisite number of Company shares were voted in favor of Proposal No. 1 and Proposal No. 2, the proposal to adjourn the Special Meeting was not submitted for a vote at the Special Meeting. On July 5, 2021, the board of directors of Cleveland BioLabs awarded a cash bonus in the amount of $50,000 to Christopher Zosh, the Company's vice president of Finance and interim principal executive, financial and accounting officer to recognize his efforts in connection with the Company's pending merger with Cytocom Inc. The Board awarded $150,000 to each of directors Lea Verny (Chairperson) and Randy Saluck to recognize their efforts in connection with the Merger as well. About Cleveland BioLabs Cleveland BioLabs, Inc. -- http://www.cbiolabs.com-- is a biopharmaceutical company developing novel approaches to activate the immune system and address serious medical needs. The Company's proprietary platform of Toll-like immune receptor activators has applications in radiation mitigation and oncology. The Company's most advanced product candidate is entolimod, which is being developed as a medical radiation countermeasure for the prevention of death from acute radiation syndrome and other indications in radiation oncology. The Company was incorporated in Delaware in June 2003 and is headquartered in Buffalo, New York. Cleveland Biolabs reported a net loss of $2.44 million for the year ended Dec. 31, 2020, compared to a net loss of $2.69 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $14.70 million in total assets, $518,151 in total liabilities, and $14.18 million in total stockholders' equity. COLUMBIAN FINANCIAL: A.M. Best Reviews B(Fair) Fin. Strength Rating ------------------------------------------------------------------- AM Best has placed under review with developing implications the Financial Strength Rating of B (Fair) and the Long-Term Issuer Credit Ratings of "bb+" (Fair) of Columbian Mutual Life Insurance Company (Columbian) (Binghamton, NY) and Columbian Life Insurance Company (Chicago, IL), collectively referred to as Columbian Financial Group (CFG). CFG focuses on the senior market with family solutions, pre-need, final expense and simplified issue term life insurance products. The group's operations are conducted on a general agency plan in all 50 states, the District of Columbia and the U.S. Virgin Islands, with its core business focused mainly in small face amount life insurance markets with distribution through home sales, general agents and independent marketing organizations. The under review with developing implications Credit Rating (rating) action reflects the recent announcement by Columbian that its board of directors has approved a strategic transaction with Constellation Insurance Holdings, Inc. (Constellation) that includes the sponsored demutualization of Columbian to a stock company with the issuance of all newly issued stock to Constellation. Constellation is an insurance holding company backed by two large Canadian institutional investors primarily engaged in the management of pension plans, Caisse de Depot et Placement du Quebec and Ontario Teachers' Pension Plan Board. The transaction provides for Constellation to invest up to $100 million to fund cash payments to eligible policyholders and significantly strengthen the capitalization of Columbian. AM Best notes that despite the likely positive impact on capital from the planned transaction with Constellation, regulatory and policyholder approvals are still needed, with an anticipated closing date sometime during the first half of 2022. In the interim, further negative rating actions on CFG are possible if its risk-adjusted capitalization continues to decline prior to close of the transaction. AM Best will continue to monitor the group's capitalization and operating performance over the near term, given the impact that the ongoing COVID-19 pandemic has had on 2020 and early 2021 results. CYPRUS MINES: FCR Seeks to Hire Frankel Wyron as Legal Counsel -------------------------------------------------------------- Roger Frankel, the future claimants' representative in Cyprus Mines Corp.'s bankruptcy, seeks approval from the U.S. Bankruptcy Court for the District of Delaware to hire Frankel Wyron, LLP as his legal counsel. The firm's services include: (a) working with the future claimants' representative to coordinate the work of his professionals to ensure that he is provided with the advice and information necessary to perform his duties efficiently and effectively; (b) in coordination with Togut, Segal & Segal, LLP, as appropriate, advising the future claimants' representative in the performance of his duties; (c) in coordination with Togut, Segal & Segal, as appropriate, providing legal advice to the future claimants' representative on strategic issues relating to the rights and positions of parties in the Chapter 11 Case and their impact on the interests of future claimants; (d) advising the future claimants' representative in the formulation, negotiation, confirmation, and implementation of a plan of reorganization, and any transactions related thereto, as well as trust agreements, trust distribution procedures and other documents necessary to establish and implement a personal injury compensation trust; (e) assisting Togut, Segal & Segal, as appropriate, in advising the future claimants' representative with respect to, and assisting as appropriate in connection with, any contested matter, adversary proceeding or other proceeding in which he may become a party or may otherwise appear; (f) consulting with the Debtor, any official or ad hoc committees, creditors, the U.S. trustee, and other parties in interest concerning the Chapter 11 case; and (g) other necessary legal services. Richard Wyron, Esq., a partner at Frankel Wyron, will charge $975 per hour for his services. In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, Frankel Wyron disclosed the following: -- The firm has not agreed to a variation of its standard or customary billing arrangements for this engagement. -- The firm's professionals have not varied their rate based on the geographic location of the Chapter 11 case. -- The firm did not represent the future claimants' representative during the pre-bankruptcy period; and -- The future claimants' representative has or will approve the prospective budget and staffing plan for Frankel Wyron's engagement for the post-petition period as appropriate. In accordance with the U.S. Trustee Guidelines, the budget may be amended as necessary to reflect changed or unanticipated developments. Mr. Wyron disclosed in a court filing that his firm neither holds nor represents any interest that is materially adverse to the future claimants' representative or to the interests of future claimants. The firm can be reached through: Richard H. Wyron Frankel Wyron LLP 2101 L Street, NW, Suite 800 Washington, DC 20037 Telephone: (202) 367-9127 Email: rwyron@frankelwyron.com About Cyprus Mines Corporation Cyprus Mines Corporation is a Delaware corporation and a wholly-owned subsidiary of Cyprus Amax Minerals Co., which is an indirect subsidiary of Freeport-McMoRan Inc. It currently has relatively limited business operations, which include the ownership of various parcels of real property, certain royalty interests that generate de minimis revenue (e.g., less than $1,500 in each of the past two calendar years), and the ownership of an operating subsidiary that conducts marketing activities. Cyprus Mines is a predecessor in the interest of Imerys Talc America, Inc. In June 1992, Cyprus Mines sold its talc-related assets to RTZ America Inc. (later known as Rio Tinto America, Inc.) through a two-step process. First, Cyprus Mines transferred its talc-related assets and liabilities (subject to minor exceptions) to Cyprus Talc Corporation, a newly formed subsidiary of Cyprus Mines, according to an Agreement of Transfer and Assumption, dated June 5, 1992. Second, Cyprus Mines sold the stock of Cyprus Talc Corporation to RTZ according to a Stock Purchase Agreement, also dated June 5, 1992 (as amended, the "1992 SPA"). The purchase price was approximately $79.5 million. Cyprus Talc Corporation was later renamed Imerys Talc America, Inc. Under the 1992 ATA, the entity now named Imerys expressly and broadly assumed the talc liabilities of Cyprus Mines and its former subsidiaries that were in the talc business. Cyprus Mines filed for Chapter 11 bankruptcy protection (Bankr. D. Del. Case No. 21-10398) on Feb. 11, 2021, listing between $10 million and $50 million in assets, and between $1 million and $10 million in liabilities. The Honorable Laurie Selber Silverstein is the case judge. The Debtor tapped Reed Smith LLP as bankruptcy counsel, Kasowitz Benson Torres LLP as special conflicts counsel, and Prime Clerk LLC as claims agent. The U.S. Trustee for Regions 3 and 9 appointed an official committee of tort claimants on March 4, 2021. The tort committee is represented by Caplin & Drysdale, Chartered, and Campbell & Levine, LLC. Province, LLC, and Axlor Consulting, LLC serve as the tort committee's financial advisor and consultant, respectively. Roger Frankel serves as the legal representative for future personal injury claimants. The FCR tapped Togut, Segal & Segal, LLP, Burr & Forman, LLP and Frankel Wyron, LLP as bankruptcy counsel; Anderson Kill, PC as special insurance counsel; and Province, LLC as financial advisor. The FCR also tapped the services of economic expert, Berkeley Research Group, LLC. DEA BROTHERS: May Use Cash Collateral, Pay Creditor --------------------------------------------------- Judge Erithe A. Smith directed DEA Brothers Sisters, LLC to continue paying creditor, Alejandro Hernandez $4,056 monthly until further notice. The Debtor, at the June 10, 2021 hearing on the motion, was granted continued access to cash collateral related to the Debtor's commercial shopping center located at 16502 S. Main St., Carson, California. The property is encumbered by a first lien mortgage of Mr. Hernandez. The Court will continue hearing on the motion on July 16, 2021 at 10 a.m. at which time the Court will also hold an evidentiary hearing to determine the valuation of the subject property pursuant to the Debtor's Motion to Value. A copy of the order is available for free at https://bit.ly/3xjNeRm from PacerMonitor.com. About DEA Brothers Sisters DEA Brothers Sisters, LLC is a Laguna Hills, Calif.-based company that owns a strip shopping center located at 16502 S. Main St., Carson, Calif. DEA Brothers Sisters sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Calif. Case No. 21-10608) on March 10, 2021. In the petition signed by Enayat Ali Jiwani, the sole managing member, the Debtor disclosed between $1 million and $10 million in both assets and liabilities. Judge Erithe A. Smith oversees the case. Financial Relief Legal Advocates, Inc. and Osborn Plasse serve as the Debtor's legal counsel. DIOCESE OF WINONA-ROCHESTER: Unsecured Claims Unimpaired Under Plan ------------------------------------------------------------------- Diocese of Winona-Rochester and Official Committee of Unsecured Creditors submitted a Joint Disclosure Statement for their Third Amended Joint Chapter 11 Plan of Reorganization for the Diocese. The Plan is based on two settlements: * One settlement is among the Diocese, the Catholic Entities, and certain Settling Insurers and amounts to $6,500,000. This settlement is evidenced by the LMI/Interstate Settlement Agreement, which is subject to Bankruptcy Court approval. In general terms, the LMI/Interstate Settlement Agreement provides for (a) the buy back by certain Underwriters at Lloyd's, London, and certain London Market Companies (as defined in the LMI/Interstate Settlement Agreement) (collectively, "LMI") and Interstate Fire & Casualty Company ("Interstate" and together with LMI, "LMI/Interstate") of their policies from the Catholic Entities and (b) injunctions which prohibit, among others, Tort Claimants from suing LMI/Interstate. LMI/Interstate constitute "Settling Insurers" under the Plan. * The second settlement is among the Diocese, certain Catholic Entities, and the Committee and amounts to $13,560,000 (minus (i) amounts paid by the Debtor for certain administrative expenses paid after February 29, 2020 and (ii) counseling expenses for Tort Claimants paid by the Debtor) to be paid within five days after the Effective Date of the Plan (which payment shall constitute substantial consummation of the Plan), plus an additional $7,690,000 to be paid as soon as practical but in no event more than 12 months after the Effective Date. In addition, the Debtor has agreed to pay up to an additional $750,000 to fund the Impaired Unknown Tort Claim Reserve Fund. All of the settlement amounts will be payable to the Trust set up through the Plan and Disclosure Statement process. The cash required to fund the Trust that will pay holders of Class 3 and 4B Claims, will come from (i) $13,560,000.00 of cash from the Debtor (minus (A) amounts paid by the Debtor for certain administrative expenses paid after February 29, 2020 and (B) counseling expenses for Tort Claimants paid by the Debtor) to be paid within five days after the Effective Date of the Plan (which payment shall constitute substantial consummation of the Plan), plus an additional $7,690,000 of cash from the Debtor and certain Catholic Entities to be paid within 12 months after the Effective Date, plus up to an additional $750,000 from the Debtor to fund the Impaired Unknown Tort Claim Reserve Fund, (ii) $6,500,000.00 of cash from LMI/Interstate, and (iii) the Transferred Insurance Interests. The Debtor currently has sufficient funds on hand to make the initial cash payment required of it by the Plan, and the Plan provides the Debtor up to 12 months to make the second cash payment of $7,690,000, which the Debtor believes is sufficient time to raise such funds via the sale or financing of certain assets and contributions from certain non-Diocesan entity resources. The Plan will treat claims as follows: -- TORT CLAIMS OTHER THAN IMPAIRED UNKNOWN TORT CLAIMS (CLASS 3). Class 3 Claims will be paid in accordance with the provisions of the Trust and Trust Distribution Plan. Class 3 is impaired. -- IMPAIRED UNKNOWN TORT CLAIMS (CLASS 4B). The Trust will make distributions to the Class 4B Claimants, as provided by the Plan, the Trust Agreement, and the Trust Distribution Plan, which will represent the sole recovery available to Class 4B Claimants in respect to any obligation owed by the Settling Insurers. Distribution from the Trust, however, does not preclude or affect claims or recoveries by Class 4B Claimants against the Non-Settling Insurers. Class 4B is impaired. -- GENERAL UNSECURED CLAIMS (CLASS 5). Each holder of a Class 5 Claim will receive, directly from the Reorganized Debtor, payment in full of such allowed Class 5 Claim, without interest, on the Effective Date. Class 5 is unimpaired. Attorneys for the Diocese: Thomas R. Braun Christopher W. Coon 117 East Center Street Rochester, MN 55904 Tel: (507) 216-8652 E-mail: thomas@restovichlaw.com christopher@restovichlaw.com Robert J. Diehl, Jr. Brian R. Trumbauer Jaimee L. Witten BODMAN PLC 6th Floor at Ford Field 1901 St. Antoine Street Detroit, Michigan 48226 Tel: (313) 259-7777 E-mail: rdiehl@bodmanlaw.com btrumbauer@bodmanlaw.com jwitten@bodmanlaw.com Attorneys for the Creditors' Committee: Robert T. Kugler Edwin H. Caldie Andrew J. Glasnovich STINSON, LLP 50 South Sixth Street, Suite 2600 Minneapolis, MN 55402 Telephone: 612-335-1500 Facsimile: 612-335-1657 E-mail: robert.kugler@stinson.com ed.caldie@stinson.com drew.glasnovich@stinson.com A copy of the Disclosure Statement is available at https://bit.ly/363JebD from PacerMonitor.com. About The Diocese of Winona-Rochester The Diocese of Winona-Rochester was established on Nov. 26, 1889 when Pope Leo XIII issued the apostolic constitution which erected the diocese, and set its geographical boundaries. The Diocese encompasses the 20 southernmost counties of the state of Minnesota and measures 12,282 square miles. The Diocese is home to 107 parishes, four high schools, 30 junior high, elementary or preschools, and Immaculate Heart of Mary Seminary in Winona. The Diocese of Winona-Rochester is headquartered at the Diocesan Pastoral Center in Winona, Minnesota. The Diocese of Winona-Rochester sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Minn. Case No. 18-33707) on Nov. 30, 2018. In the petition signed by Reverend Monsignor Thomas P. Melvin, vicar general, the Debtor estimated $10 million to $50 million in assets and $1 million to $10 million in liabilities. Judge Robert J. Kressel oversees the case. The Debtor tapped Bodman PLC as bankruptcy counsel, Restovich Braun & Associates as local counsel, Burns Bowen Bair LLP as special insurance litigation counsel, and Alliance Management, LLC as financial consultant. The U.S. Trustee for Region 12 appointed the official committee of unsecured creditors in the Debtor's Chapter 11 case on Dec. 19, 2018. The committee is represented by Stinson Leonard Street, LLP. DOMINION DEVELOPMENT: Case Summary & 12 Unsecured Creditors ----------------------------------------------------------- Debtor: Dominion Development Partners, Inc. 7900 W. Sahara Ave. Las Vegas, NV 89117 Business Description: Dominion Development Partners, Inc. Chapter 11 Petition Date: July 6, 2021 Court: United States Bankruptcy Court District of Nevada Case No.: 21-13400 Debtor's Counsel: Jeffrey J. Whitehead, Esq. WHITEHEAD & BURNETT 6980 O'Bannon Drive Las Vegas, NV 89117 Tel: 702-267-6500 Fax: 702-267-6262 Email: jeff@whiteheadburnett.com Total Assets: $872,939 Total Liabilities: $1,186,357 The petition was signed by Kevin W. Williams, president. A full-text copy of the petition containing, among other items, a list of the Debtor's 12 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/VIPK3BI/DOMINION_DEVELOPMENT_PARTNERS__nvbke-21-13400__0001.0.pdf?mcid=tGE4TAMA EAGLE HOSPITALITY: Rejection Dispute Impacts Chapter 11 Case ------------------------------------------------------------ Law360 reports that the Eagle Hospitality hotel chain's already storm-tossed Chapter 11 has sailed into a bizarre naval battle with the city of Long Beach, California, over the city's objection to the debtor's allegedly improper rejection of a hotel lease for the repurposed Queen Mary cruise liner. Among the city's concerns, according to court documents, are risks to the hotel-ship posed by a leaking former Soviet navy submarine that is moored alongside the landward bow of the Queen Mary but that is currently publicly claimed by neither the debtor nor the city. About Eagle Hospitality Group Eagle Hospitality Trust -- https://eagleht.com/ -- is a hospitality stapled group comprising Eagle Hospitality Real Estate Investment Trust ("Eagle H-REIT") and Eagle Hospitality Business Trust. Based in Singapore, Eagle H-REIT is established with the principal investment strategy of investing on a long-term basis, in a diversified portfolio of income-producing real estate which is used primarily for hospitality and/or hospitality-related purposes, as well as real estate-related assets in connection with the foregoing, with an initial focus on the United States. EHT US1, Inc., and 26 affiliates, including 15 LLC entities that each owns hotels in the U.S., sought Chapter 11 protection (Bankr. D. Del. Lead Case No. 21-10036) on Jan. 18, 2021. EHT US1, Inc., estimated $500 million to $1 billion in assets and liabilities as of the bankruptcy filing. The Debtors tapped PAUL HASTINGS LLP as bankruptcy counsel; FTI CONSULTING, INC., as restructuring advisor; and MOELIS & COMPANY LLC, as investment banker. COLE SCHOTZ P.C. is the Delaware counsel. RAJAH & TANN SINGAPORE LLP is Singapore Law counsel, and WALKERS is Cayman Law counsel. DONLIN, RECANO & COMPANY, INC., is the claims agent. EMPLOYBRIDGE HOLDING: Moody's Assigns B2 CFR on Revenue Growth -------------------------------------------------------------- Moody's Investors Service assigned to EmployBridge Holding Company a corporate family rating at B2, probability of default rating at B2-PD and a B3 rating to the proposed $725 million senior secured term loan B due 2028. The outlook is stable. The proceeds of the proposed term loan and equity from affiliates of Apollo Global Management, LLC ("Apollo") will be used to purchase the company for approximately $1.1 billion and pay transaction-related fees and expenses. Approximately $100 million in deferred FICA tax payments stemming from the CARES ACT will be repaid at or prior to closing. Governance is a key consideration given the company's private equity ownership. Ratings currently assigned to EmployBridge, LLC will be withdrawn upon repayment of the existing debt. RATINGS RATIONALE EmployBridge's B2 CFR reflects Moody's expectations for high-single-digit revenue growth in 2021, improving profitability rates and debt-to-EBITDA to decline to below 5.0 times in 2022. The expected strong revenue growth, supported by the broad recovery in EmployBridge's supply chain centric customer base and the tight US labor market, should drive the company's EBITDA to at least $150 million by 2022. Pro forma for the transaction, debt-to-EBITDA was 6.7 times as of LTM March 31, 2021. The ratings also consider EmployBridge's modest profitability rates, with EBITDA margins expected to be around 5%, which is low compared to some other temporary staffing companies. The industry is mature and highly competitive with several significantly larger staffing companies as well as established niche players. However, Moody's believes that secular trends towards greater workforce outsourcing remain supportive of sustained, albeit modest, revenue and earnings growth at the company. Free cash flow to debt in a low-to-mid single digit percentage range and EBITA to interest around 2.5 times expected provide additional ratings support. Given the mature and competitive industry dynamics and modest profitability rates, maintenance of better than median credit metrics compared to other services issuers also rated at the B2 CFR category is an important support for the rating. All financial metrics cited reflect Moody's standard adjustments. EmployBridge's credit profile is supported by the company's competitive size and national branch network, enabling the company to serve national multi-site clients and to invest in technology and talent. The company has a diverse customer base, but there is some customer concentration, with its largest customer accounting for 3 percent of total revenue and the top ten making up 10%. However, Moody's notes the concentration is with a high-quality roster of large logistics and light-manufacturing related companies. Moreover, EmployBridge is growing its on-site presence at many of its largest client's facilities, which Moody's anticipates will increase client retention and establish stronger competitive barriers. ESG considerations incorporated in the B2 CFR include governance pressure from Moody's expectation for aggressive financial strategies typically employed by private equity sponsor owners, including debt-funded acquisitions and shareholder returns. Moody's expects EmployBridge to maintain an adequate liquidity profile. Moody's anticipates at least $50 million of cash at transaction close and approximately $160 million of availability (net of around $140 million used to issue letters of credit supporting its workers' compensation insurance program) under the proposed and unrated $300 million senior secured asset-based revolving credit facility ("ABL") due 2026. Moody's expects break-even free cash flow in 2021, impacted by expenses related to the transaction and an increase in working capital usage to support revenue growth, but at least $25 million of free cash flow in 2022, which is adequate to cover $7.3 million of annual term loan debt amortization. EmployBridge's cash flow is seasonal, with working capital typically decreasing in the first fiscal quarter, thereby driving positive free cash flow, and then building throughout the course of the rest of the year, driving low or negative free cash flow. There are no financial covenants applicable to the term loan. The ABL is subject to a springing minimum fixed charge coverage ratio (to be defined in the loan documentation) of at least 1.0 time when the availability is less than the greater of (i) 10% of the lesser of the borrowing base and the line cap and (ii) $30 million. Moody's does not expect the covenant to be measured over the next 12 to 15 months, but anticipates EmployBridge could comfortably meet the test if it is measured. The B3 rating on the senior secured term loan, one notch below the CFR, reflects both the PDR of B2-PD and a loss given default assessment of LGD4, reflecting its second priority lien on the most liquid assets of the company and first priority lien on all other property. The proposed ABL has a first priority lien on the most liquid assets of the company, and is ranked ahead of all other debt in Moody's hierarchy of claims at default. The proposed credit facilities provide covenant flexibility that, if utilized, could negatively impact creditors. Notable terms include ABL incremental facility up to the greater of 1) the greater of a) $160 million and b) 1.0x LTM EBITDA and 2) suppressed availability; incremental debt capacity of first lien term loan up to the sum of (x) the sum of (I) the greater of a) $160 million and b) 1.0x LTM EBITDA on a Pro Forma Basis, plus (II) an amount equal to the greater of a) $120 million and b) 0.75x LTM EBITDA on a Pro Forma Basis (with a corresponding reduction of the general debt basket), plus (y) unlimited amounts no greater than 0.25x above the Net First Lien Leverage Ratio on the closing date (if pari passu secured). Amounts up to the greater of 160 million and 1.0x LTM EBITDA may be incurred with an earlier maturity date than the initial term loans. There are no express "blocker" provisions which prohibit the transfer of specified assets to unrestricted subsidiaries; such transfers are permitted subject to carve-out capacity and other conditions. Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees, with no explicit protective provisions limiting such guarantee releases. There are no express protective provisions prohibiting an up-tiering transaction. These proposed terms and the final terms of the credit agreement may be materially different. The stable outlook reflects Moody's expectations for sustained revenue and earnings growth to push debt to EBITDA to decline below 5.0 times over the next 12 to 18 months. The stable outlook also anticipates that EmployBridge will maintain solid credit metrics, including debt to EBITDA below 5.0 times, and adequate liquidity when it concludes future debt-funded acquisitions or equity distributions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Ratings could be upgraded if EmployBridge generates revenue and EBITDA growth such that it can sustain throughout the business cycle: 1) debt-to-EBITDA below 4.0 times; 2) free cash flow-to-debt in the high single digits percentages; 3) EBITDA margins above 5%; and 4) good liquidity. Expectations for balanced financial strategies emphasizing debt reduction is also an important consideration for higher ratings. The ratings could be downgraded if Moody's expects: 1) revenue and profits will not grow consistently, or will grow only slowly; 2) an increase in competition causing a loss of market share; 3) debt-to-EBITDA will be sustained above 5.0 times; 4) free cash flow-to-debt will be less than 1%; or 5) EmployBridge's liquidity profile will deteriorate. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Issuer: Employbridge Holding Company Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Senior Secured Term Loan, Assigned B3 (LGD4) Outlook is Stable EmployBridge, based in Atlanta, GA and to be controlled by Apollo, is a provider of temporary and contract staffing services through company owned and franchised locations throughout the U.S. The company offers temporary staffing, temp-to-hire, and direct placement services and derives most of its revenues from the placement of light industrial, transportation and clerical staff. Moody's expects revenue of over $3.1 billion in FY 2021. EVERCOMMERCE SOLUTIONS: Moody's Affirms B1 CFR Amid Recent IPO -------------------------------------------------------------- Moody's Investors Service affirmed EverCommerce Solutions Inc.'s ("EverCommerce") B1 corporate family rating, B1-PD probability of default rating, and the B1 ratings on the company's senior secured first lien credit facility, comprised of a $350 million term loan and an undrawn $190 million revolver. Concurrently, Moody's assigned a speculative grade liquidity rating of SGL-1. The rating action follows the completion of an IPO of EverCommerce's parent company EverCommerce Inc. ("EverCommerce Inc.") with a somewhat more leveraged capital structure and less balance sheet cash than Moody's previously anticipated. [1] The ratings outlook is stable. Affirmations: Issuer: EverCommerce Solutions Inc. Corporate Family Rating, Affirmed B1 Probability of Default Rating, Affirmed B1-PD Senior Secured First Lien Bank Credit Facility, Affirmed B1 (LGD3) Assignments: Issuer: EverCommerce Solutions Inc. Speculative Grade Liquidity Rating, Assigned SGL-1 Outlook Actions: Issuer: EverCommerce Solutions Inc. Outlook, Remains Stable RATINGS RATIONALE EverCommerce's B1 CFR is constrained by the company's somewhat high pro forma trailing debt leverage approximating 4.5x (Moody's adjusted for operating leases), limited scale, and the potential for material customer losses due to macroeconomic cyclicality or intensifying competitive pressures. Additionally, EverCommerce Inc., after completion of the IPO, continues to be majority owned by Providence Strategic Growth ("PSG") and Silver Lake Alpine ("SLA"), which presents risks with respect to the potential for aggressive financial strategies. In particular, the undertaking of material debt funded acquisitions which increase debt leverage above current levels could meaningfully pressure credit quality. The company's credit profile is supported by a solid presence within its target markets and healthy secular long term growth prospects fueled by accelerating adoption of digital technologies by SMBs to enhance customer marketing, billing, payment processing, and overall operational effectiveness. The company's primarily subscription-driven business model and highly diversified client base contribute to EverCommerce's healthy revenue predictability and the potential for improving free cash flow generation. The B1 ratings for EverCommerce's first lien bank debt reflect the borrower's B1-PD PDR and a loss given default ("LGD") assessment of LGD3. The B1 first lien ratings are consistent with EverCommerce's CFR as these debt instruments account for the preponderance of the overall entity's pro forma debt structure. EverCommerce's very good liquidity, as indicated by the SGL-1 rating. is principally supported by a pro forma cash balance of approximately $200 million following the completion of a debt refinancing transaction and IPO. Moody's expects the company to generate modest free cash flow in FY21, but expects this metric to approach 15% of total debt in FY22. The company's liquidity is also supported by Moody's expectation of approximately $110 million of availability under EverCommerce's $190 million revolving credit facility. While the term loans are not subject to financial covenants, the revolving credit facility has a springing covenant based on a maximum net first lien leverage ratio of 7.5x (with no step-downs) which the company should be comfortably in compliance with over the next 12-18 months. The stable outlook reflects Moody's expectation that EverCommerce's revenues will increase (on an organic basis) at a high single digit rate in FY21, but higher operating expenses will result in a moderate contraction in EBITDA during this period, resulting in Debt/EBITDA (Moody's adjusted) approximating 4.5x. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The rating could be upgraded if EverCommerce generates meaningful revenue growth and expands profitability margins while adhering to a conservative financial policy with declining private equity ownership, maintaining very good liquidity, and sustaining debt/EBITDA (Moody's adjusted) below 3.5x. The rating could be downgraded if EverCommerce were to experience weakening operating performance or the company maintains aggressive financial policies such that debt/EBITDA (Moody's adjusted) is sustained above 4.5x and annual free cash flow to debt is sustained below 10%. The principal methodology used in these ratings was Software Industry published in August 2018. EverCommerce, majority-owned by PSG and SLA, provides SaaS-based integrated solutions for business management, billing, payment processing, customer engagement and marketing principally for SMBs globally. Moody's forecasts that the company will generate sales of approximately $430 million in 2021. EXPO CONSTRUCTION: Hearing Continued on July 7 ---------------------------------------------- Judge Eduardo V. Rodriguez has entered an order that the June 29, 2021, hearing on approval of the amended disclosure statement of Expo Construction Group, LLC is continued to July 7, 2021 at 2:00 p.m. About Expo Construction Group Expo Construction Group, LLC, a Houston-based general contractor, filed a voluntary petition for relief under Chapter 11 of the United States Code (Bankr. S.D. Texas Case No. 20-34099) on Aug. 18, 2020. Melida Taveras, a managing member, signed the petition. At the time of filing, the Debtor estimated $100,000 to $500,000 in assets and $1 million to $10 million in liabilities. The Law Office of Margaret M. McClure serves as the Debtor's legal counsel. FIFTEEN TWENTY: Voluntary Chapter 11 Case Summary ------------------------------------------------- Debtor: Fifteen Twenty Six Fifty Second LLC 351 Spook Rock Road Suffern, NY 10901 Business Description: Fifteen Twenty Six Fifty Second LLC is a Single Asset Real Estate debtor (as defined in 11 U.S.C. Section 101(51B)). Chapter 11 Petition Date: July 7, 2021 Court: United States Bankruptcy Court Southern District of New York Case No.: 21-22397 Judge: Hon. Robert D. Drain Debtor's Counsel: Robert L. Rattet, Esq. DAVIDOFF HUTCHER & CITRON LLP 605 Third Avenue 34th Floor New York, NY 10158 Tel: 212 557 7200 Fax: 212-286-1884 E-mail: rlr@dhclegal.com Total Assets: $4,700,000 Total Liabilities: $1,138,820 The petition was signed by Isaac Lefkowitz, CEO. The Debtor stated it has no unsecured creditors. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/N2DANMQ/Fifteen_Twenty_Six_Fifty_Second__nysbke-21-22397__0001.0.pdf?mcid=tGE4TAMA FORT DEARBORN: Clayton Acquisition No Impact on Moody's B3 Rating ----------------------------------------------------------------- Moody's Investors Service said all ratings of Fort Dearborn Holding Company, Inc. (B3 stable) are unchanged following the company's announcement on July 2 that Clayton, Dublier & Rice funds will acquire it from Advent International for an undisclosed sum and combine it with LABL, Inc. (B3 stable). The company said the transaction is expected to close by the end of 2021, subject to regulatory and customary approvals. Moody's views the merger of two label companies with complementary businesses as credit positive, particularly for the smaller Fort Dearborn business, as the transaction increases consolidation in the fragmented label market. Both Fort Dearborn and LABL , Inc. grew through acquisitions and have levered balance sheets. Fort Dearborn credit agreements include change of control provisions that require debt repayment. Moody's will withdraw Fort Dearborn ratings if debt is repaid, otherwise ratings will depend on the funding structure and ultimate debt level of the future combined company. Clayton, Dublier & Rice did not disclose the funding structure for the combined company at this time. The combined company will have pro forma sales of $2.7 billion in the twelve months ended March 31, 2021, with concentration in North America. Fort Dearborn is primarily a domestic company, LABL, Inc., which operates as Multi-Color Corporation, is a global business. Headquartered in Elk Grove Village, Illinois, Fort Dearborn Holding Company, Inc., is a supplier of labels to a variety of consumer products and packaged food end markets. Revenues for the twelve months ended March 31, 2021, were approximately $602 million. Fort Dearborn is a portfolio company of Advent International. GIRARDI & KEESE: Victims Get Court Okay to Go After Erika for Funds ------------------------------------------------------------------- Law360 reports that a California bankruptcy judge gave the green light Tuesday, July 6, 2021, to former clients of celebrity lawyer Thomas Girardi to proceed with a collection lawsuit against his estranged wife, "The Real Housewives of Beverly Hills" star Erika Girardi. In a short order, U.S. Bankruptcy Judge Barry Russell lifted a stay so the ex-clients and the bankruptcy trustee liquidating Tom Girardi's personal property can continue recouping the $11 million judgment against the embattled attorney that they received in 2020 litigation. Trustee Jason Rund of Sheridan & Rund PC and secured creditors Joseph Ruigomez, Jaime Ruigomez and Kathleen Ruigomez entered into a stipulation lastJune 2021. About Girardi & Keese Girardi and Keese or Girardi & Keese was a Los Angeles-based law firm founded in 1965 by lawyers Thomas Girardi and Robert Keese. It served clients in California in a variety of legal areas. It was known for representing plaintiffs against major corporations. An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No. 20-21022) was filed in December 2020 against GIRARDI KEESE by alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian, Erika Saldana, Virginia Antonio, and Kimberly Archie. The petitioners' attorneys: Andrew Goodman Goodman Law Offices, Apc Tel: 818-802-5044 E-mail: agoodman@andyglaw.com Elissa D. Miller, a member of the firm SulmeyerKupetz, has been appointed as Chapter 7 trustee. The Chapter 7 trustee can be reached at: Elissa D. Miller 333 South Grand Ave., Suite 3400 Los Angeles, California 90071-1406 Telephone: (213) 626-2311 Facsimile: (213) 629-4520 E-mail: emiller@sulmeyerlaw.com GROUPE SOLMAX: S&P Assigns 'B' Long-Term ICR, Outlook Stable ------------------------------------------------------------ On July 6, 2021, S&P Global Ratings assigned its 'B' long-term issuer credit rating to Quebec-based Groupe Solmax Inc., the leading global producer in the highly fragmented polymer-based geosynthetic industry. S&P said, "At the same time, we assigned our 'B' issue-level rating, and '3' recovery rating, to the company's proposed US$535 million first-lien loan and US$100 million revolving credit facility. "The stable outlook reflects our view of the favorable end market demand for Solmax's products, led by stronger macroeconomic growth and increased project spending in the company's core water, waste, and infrastructure end markets, resulting in leverage of just over 5x and positive free cash flow in 2021 and 2022. "The final ratings are in line with our preliminary ratings. There were no material changes to our base case or the financial documentation from our initial review. "The stable outlook reflects our view of the favorable end market demand for Solmax's products, led by stronger macroeconomic growth and increased project spending in the company's core water, waste, and infrastructure end markets. We assume gradual improvement in the company's earnings and cash flow over the next couple of years, resulting in leverage of just over 5x and positive free cash flow. "We could lower the rating if Solmax's adjusted debt to EBITDA exceeds 7x, with poor prospects of improvement. This could result from slower-than-expected demand in the company's core end markets or more aggressive pricing from competitors. A more aggressive financial policy resulting in debt-financed acquisitions or shareholder-friendly initiatives could also lead to a downgrade, although we believe this is unlikely in the near term. "Given the company's near-term focus on digesting the TenCate acquisition and all the associated integration risks, we view an upgrade as unlikely in the next 12 months. Over time, an upgrade could occur if Solmax's debt leverage were to decrease and remain well below 4x, and the company demonstrated a commitment to maintain that level of leverage." HASTINGS AND HOLLOWELL: Unsecureds to Get Full Payment Under Plan ----------------------------------------------------------------- Hastings and Hollowell, Inc. submitted a Plan and a Disclosure Statement. On April 8, 2021 ("Petition Date"), the Debtor filed a voluntary petition for relief pursuant to chapter 11 of the United States Bankruptcy Code. Mr. Russel Hastings, sole owner of the Debtor, also owned and operated The Border Station, Inc., a gas station and convenience store, located on real property owned by Debtor. Mr. Hastings passed away on July 27, 2019. Upon his death all of the outstanding stock in the Debtor and the Border Station, Inc. passed to a trust for the benefit of a child and grandchild of Mr. Hastings. Lennie Hughes is the Trustee of this trust. Following Mr. Hastings' death the Debtor's largest creditor, Southern Bank and Trust Company declared the loan to be in default, and began foreclosure proceedings against Debtor in both North Carolina and Virginia. Prior to the Petition Date, the Debtor sought to sell its real property, in order to satisfy its secured debts. With Court approval, the Debtor intends to continue to seek a buyer for the purpose of liquidating its real property; however, the payment provisions of the Plan are premised upon the existing lease of Debtor's real property and not contingent upon any sale of the same. Classes of Priority Unsecured Claims. Certain priority claims that are referred to in §§ 507(a)(1), (4), (5), (6), and (7) of the Code are required to be placed in classes. The Code requires that each holder of such a claim receive cash on the Effective Date of the Plan equal to the allowed amount of such claim. However, a class of holders of such claims may vote to accept different treatment. Attorney for Debtor: CLAYTON W. CHEEK N.C. State Bar No. 30590 The Law Offices of Oliver & Cheek, PLLC PO Box 1548 New Bern, NC 28563 Telephone: (252) 633-1930 Facsimile: (252) 633-1950 Email: clayton@olivercheek.com A copy of the Disclosure Statement is available at https://bit.ly/363P5O8 from PacerMonitor.com. About Hastings and Hollowell Hastings and Hollowell, Inc., is a Moyock, North Carolina-based single asset real estate corporation engaged in the business of leasing its real property. The Debtor filed a Chapter 11 petition (Bankr. E.D.N.C. Case No. 21-00806) on April 8, 2021. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge David M. Warren presides over the case. The Law Offices of Oliver & PLLC, led by Clayton W. Cheek, Esq., and Tadlock & Associates, Inc. serve as the Debtor's legal counsel and accountant, respectively. HOUSTON AMERICAN: Ault Global Has 9.9% Stake as of June 30 ---------------------------------------------------------- Ault Global Holdings, Inc. filed a Schedule 13D with the Securities and Exchange Commission disclosing that as of June 30, 2021, it beneficially owns 982,000 shares of common stock of Houston American Energy Corp., which represents 9.9 percent of the shares outstanding. The aggregate percentage of shares reported owned by Ault Global Holdings is based upon 9,923,338 shares outstanding, which is the total number of shares outstanding as of May 14, 2021, as reported in the issuer's Quarterly Report on Form 10-Q filed with the SEC on May 17, 2021. A full-text copy of the regulatory filing is available for free at: https://www.sec.gov/Archives/edgar/data/896493/000121465921007115/e630214sc13d.htm About Houston American Energy Based in Houston, Texas, Houston American Energy Corp. is a publicly-traded independent energy company with interests in oil and natural gas wells, minerals and prospects. The company's business strategy includes a property mix of producing and non-producing assets with a focus on the Permian Basin in Texas, Louisiana and Columbia. Houston American reported a net loss of $4.04 million for the year ended Dec. 31, 2020, a net loss of $2.51 million for the year ended Dec. 31, 2019, and a net loss of $4.04 million for the year ended Dec. 31, 2018. As of March 31, 2021, the Company had $11.19 million in total assets, $433,254 in total liabilities, and $10.76 million in total shareholders' equity. HY "C": Case Summary & Unsecured Creditor ----------------------------------------- Debtor: HY "C", Inc. 503 Bessie Street Patterson, LA 70392 Chapter 11 Petition Date: July 7, 2021 Court: United States Bankruptcy Court Western District of Louisiana Case No.: 21-50421 Judge: Hon. John W. Kolwe Debtor's Counsel: Bradley L. Drell, Esq. GOLD, WEEMS, BRUSER, SUES & RUNDELL POB 6118 Alexandria, LA 71307-6118 Tel: (318) 445-6471 Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Owen T. Risher, registered agent/director. The Debtor listed McBank & Trust as its sole unsecured creditor holding a claim of $4.37 million. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/S7GQYXI/HY_C_Inc__lawbke-21-50421__0001.0.pdf?mcid=tGE4TAMA HYDROCARBON FLOW: Case Summary & 20 Largest Unsecured Creditors --------------------------------------------------------------- Debtor: The HydroCarbon Flow Specialist, Inc. 503 Bessie Street Patterson, LA 70392 Chapter 11 Petition Date: July 7, 2021 Court: United States Bankruptcy Court Western District of Louisiana Case No.: 21-50420 Judge: Hon. John W. Kolwe Debtor's Counsel: Bradley L. Drell, Esq. GOLD, WEEMS, BRUSER, SUES, & RUNDELL POB 6118 Alexandria, LA 71307-6118 Tel: (318) 445-6471 E-mail: bdrell@goldweems.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $10 million to $50 million The petition was signed by Owen T. Risher, registered agent/director. A full-text copy of the petition containing, among other items, a list of the Debtor's 20 largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/SQIKTFQ/The_HydroCarbon_Flow_Specialist__lawbke-21-50420__0001.0.pdf?mcid=tGE4TAMA HYDROCARBON HY-VAC: Case Summary & Unsecured Creditor ----------------------------------------------------- Debtor: HydroCarbon Hy-Vac Systems, Inc. 503 Bessie Street Patterson, LA 70392 Chapter 11 Petition Date: July 7, 2021 Court: United States Bankruptcy Court Western District of Louisiana Case No.: 21-50422 Judge: Hon. John W. Kolwe Debtor's Counsel: Bradley L. Drell, Esq. GOLD, WEEMS, BRUSER, SUES & RUNDELL POB 6118 Alexandria, LA 71307-6118 Tel: (318) 445-6471 E-mail: bdrell@goldweems.com Estimated Assets: $100,000 to $500,000 Estimated Liabilities: $1 million to $10 million The petition was signed by Owen T. Risher, director. The Debtor listed McBank & Trust as its sole unsecured creditor holding a claim of $4.37 million. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/S3WX2QY/HydroCarbon_Hy-Vac_Systems_Inc__lawbke-21-50422__0001.0.pdf?mcid=tGE4TAMA INTEGRATED AG: GWB Says Disclosure Deficient -------------------------------------------- Great Western Bank ("GWB"), filed an objection to approval of the Integrated AG XI, LLC's Disclosure Statement. GWB says approval of the Debtor's Disclosure Statement must be denied because it is woefully deficient and does not contain adequate information within the meaning of 11 U.S.C. Sec. 1125. Additionally, it asserts that the Disclosure Statement should be denied because the underlying Plan is patently unconfirmable, therefore, approval of the Disclosure Statement is futile. GWB points out that the disclosure statement contains inadequate information. i. Vague Descriptions of GWB Claim and Plan Treatment * The Disclosure Statement incorrectly describes the GWB Claim and is vague and unclear regarding GWB's treatment under the Plan. Under the Plan, GWB is an oversecured creditor entitled to not only the full outstanding principal balance owed under the terms of the Loans but GWB is also entitled to all accrued and accruing contract rate interest, fees and costs under Bankruptcy Code § 506(b). * Likewise, the Disclosure Statement fails to identify what rights and remedies GWB is entitled to under the Plan in the event of a default and instead states only generically that "GWB will retain all traditional lender protections including the ability to enforce remedies in the event of a payment default." ii. No Projections, Post-Confirmation Budget, Or Feasibility Analysis * The Disclosure Statement likewise e fails to provide any details regarding the amount of estimated payments called for under the Plan or the Debtor's ability to fund such payments. iii. No Liquidation Analysis Disclosed * The Disclosure Statement fails to include any such liquidation analysis. A liquidation analysis is particularly necessary in this Case because the Plan does not appear to pay the GWB Claim in full and is largely a pot plan with respect to unsecured claims, proposing to pay only a small fraction of allowed unsecured claims while allowing Summer Road – the Debtor's largest equity holder – to purchase millions of dollars in equity in the Debtor in exchange for a $200,000 "new value" contribution. iv. Other Missing Information * In addition to the foregoing, the Disclosure Statement also fails to provide the following information necessary for creditors to make an informed judgment regarding the Plan: - Details regarding the effect of the Plan Sponsor exercising its "option" to convert its financing to equity under the Plan. The Plan already provides that the Plan Sponsor will acquire 100% of the equity in the Reorganized Debtor, therefore, it is unclear what the effect of this option to convert will have on the Plan if exercised by the Plan Sponsor, if any. - Details regarding the former tenant and affiliate IBCD, the lease, the overlap of members of the management of ICBD and the Debtor, and unpaid rent owed by IBCD to the Debtor. GWB further points out that the plan is patently unconfirmable. Here, the Plan is clearly unconfirmable on its face for at least the following reasons: - Section 6.2(b) of the Plan, regarding the treatment of the Class 2 Secured Claim of GWB, violates Bankruptcy Code § 506(a) and (b) because it fails to properly state the amount of GWB's secured claim and also because it fails to treat the secured claim of GWB as an oversecured creditor. Section 506(b) requires that "[t]o the extent that an allowed secured claim is secured by property the value of which, after any recovery under subsection (c) of this section, is greater than the amount of such claim, there shall be allowed to the holder of such claim, interest on such claim, and any reasonable fees, costs, or charges provided for under the agreement or State statute under which such claim arose." 11 U.S.C. Sec. 506(b). - The Plan also fails to establish feasibility as required under Sec. 1129(a)(11). The Plan includes no projections or any other information to support the Debtor's alleged ability to fund the Plan. Based upon recent trial testimony, including among other things, the sworn testimony of representatives of the Debtor and sworn testimony of GWB's expert, the Debtor's Plan is not feasible. - The Plan also violates the absolute priority rule of Bankruptcy Code §1129(b)(2)(B)(ii) and § 1129(b)'s "fair and equitable" requirement because it provides the Debtor's largest security interest holder (Summer Road LLC through an affiliated entity, Azart LLC) with the exclusive opportunity to receive 100% of the equity in the Reorganized Debtor free from competition and without the benefit of market valuation. Attorneys for Great Western Bank: Janel M. Glynn (#025497) Lindsi M. Weber (#025820) THE BURGESS LAW GROUP 3131 E. Camelback Rd., Suite 224 Phoenix, AZ 85016 Telephone: (602) 806-2100 Lindsi@theburgesslawgroup.com Janel@theburgesslawgroup.com About Integrated AG XI Scottsdale, Ariz.-based Integrated AG XI, LLC, filed a Chapter 11 petition (Bankr. D. Ariz. Case No. 21-00414) on July 9, 2018. In its petition, the Debtor disclosed $33,909,241 in assets and $20,701,272 in liabilities. Bryan Hepler, an authorized representative, signed the petition. Judge Daniel P. Collins oversees the case. Burch & Cracchiolo, P.A., serves as the Debtor's bankruptcy counsel. INTEGRATED AG: UST Says Disclosure Inadequate --------------------------------------------- The United States Trustee filed an objection to Integrated AG XI, LLC's Disclosure Statement. The U.S. Trustee points out that the Debtor fails to identify the individual majority owners, members, or partners of Integrated AG Holdings. It adds that the Debtor also fails to explain the affiliation between Debtor and the Plan Sponsor, which is apparently an insider. Lastly, according to the UST, the Debtor fails to identify the individual or individuals who are responsible for providing the information contained in the Disclosure Statement. The UST further points out that the Debtor provides no itemization of its assets and the current values of those assets. The Debtor references an appraisal performed in 2019 that valued the Ranch at $35 million. However, the Debtor does not attach that appraisal to the Disclosure Statement and does not affirmatively state that the Ranch's current value is the same as the appraised value in 2019. Nor does Debtor account for other assets such as cash on hand, accounts receivable, deposits and prepayments, etc. so that creditors get a complete picture of the total liquidation value of the Debtor. Moreover, the U.S. Trustee notes that regarding its reorganization, the Debtor provides only minimal information. The Debtor anticipates having $130,000 cash on hand, will have access to a $750,000 line of credit, and will receive a supposed "new value" contribution of $200,000. It is not clear whether Debtor anticipates generating operating revenue over the life of the plan and, if so, in what amount and at what point in time those revenues are anticipated. According to the UST, the Disclosure Statement explains that the Debtor will receive a line of credit from the Plan Sponsor in the amount of $750,000, which will become available on the Effective Date of the plan. All of the specific terms of the line of credit agreement are missing from the Disclosure Statement and, despite promising to provide copies of that agreement in Exhibit E to the Disclosure Statement, to date, the agreement has not been produced. It is thus impossible for parties to determine whether the terms of the line of credit agreement are acceptable. It's also impossible to determine when, in what amounts, and over what period of time the Debtor is obligating itself to repay the line of credit draws. That too should be incorporated into an itemized budget. Lastly, the U.S. Trustee notes that the Debtors' plan proposes to allow the Plan Sponsor, which is an insider, to assume ownership of all estate property upon confirmation even though the general unsecured claims will not be paid in full. Such a provision appears to violate the absolute priority rule, which generally requires that every unsecured creditor in a dissenting impaired class be paid in full before the debtor is permitted to retain "any property" under the plan. About Integrated AG XI Scottsdale, Ariz.-based Integrated AG XI, LLC, filed a Chapter 11 petition (Bankr. D. Ariz. Case No. 21-00414) on July 9, 2018. In its petition, the Debtor disclosed $33,909,241 in assets and $20,701,272 in liabilities. Bryan Hepler, an authorized representative, signed the petition. Judge Daniel P. Collins oversees the case. Burch & Cracchiolo, P.A., serves as the Debtor's bankruptcy counsel. KATERRA INC: Seeks Approval to Hire KPMG LLP as Tax Consultant -------------------------------------------------------------- Katerra, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Bankruptcy Court for the Southern District of Texas to hire KPMG, LLP as tax consultant. The firm's services include: i. analysis of any Section 382 issues with respect to the Debtors' ability to utilize tax attributes to offset taxable in connection with potential asset dispositions; ii. analysis of tax attributes including net operating losses, tax basis in assets, and tax basis in stock of subsidiaries; iii. analysis of cancellation of debt income; iv. cash tax modeling; v. analysis of the tax implications of any dispositions of assets; vi. analysis of potential bad debt and worthless stock deductions; vii. analysis of state and local sales and use tax compliance or tax filings (including instances where the Debtors may not be filing returns); viii. analysis of federal and state employment or payroll tax compliance at the Debtors, including multistate personal income tax withholding; ix. analysis of any proof of claims from tax authorities; and x. analysis of the tax treatment of transaction or restructuring related costs. The firm will be paid at these discounted hourly rates: Partners/Principals/ Managing Directors $765 - $985 per hour Senior Managers $690 - $750 per hour Managers $650 - $730 per hour Senior Associates $470 - $640 per hour Associates $350 - $380 per hour Paraprofessionals $200 - $295 per hour KPMG received a retainer in the amount of $75,000. As disclosed in court filings, KPMG is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Howard Steinberg, CPA KPMG LLP 560 Lexington Ave. New York, NY 10022 Tel: +1 212 997 0500 Fax: +1 212 730 6892 About Katerra Inc. Based in Menlo Park, Calif., Katerra Inc. is a Japanese-funded, American technology-driven offsite construction company. Katerra was founded in 2015 by Michael Marks, former chief executive officer of Flextronics and former Tesla interim CEO, along with Fritz Wolff, the executive chairman of The Wolff Co. It offers technology-driven design, manufacturing, and assembly solution for bathroom pods, door and window, furniture, and modular utility systems. Katerra and its affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 21-31861) on June 6, 2021. In its petition, Katerra disclosed assets of between $500 million and $1 billion and liabilities of between $1 billion and $10 billion. Judge David R. Jones oversees the cases. The Debtors tapped Kirkland & Ellis, LLP and Jackson Walker, LLP as bankruptcy counsel; Houlihan Lokey Capital, Inc. as investment banker; Alvarez & Marsal North America, LLC as financial and restructuring advisor; and KPMG, LLP as tax consultant. Prime Clerk LLC is the claims and noticing agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases on June 22, 2021. The committee is represented by Fox Rothschild, LLP. KATERRA INC: Seeks to Hire Houlihan Lokey as Investment Banker -------------------------------------------------------------- Katerra, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Bankruptcy Court for the Southern District of Texas to hire Houlihan Lokey Capital, Inc. as their investment banker. The firm will render these services: a. conduct financial review and analysis of the Debtors' assets and operations, businesses and prospects; b. evaluate project level performance including pipeline and backlog; c. assist in evaluating the Debtors' liquidity and revenue initiatives/sensitivities and evaluating alternatives for improvement; d. assess the Debtors' debt and other obligations, including all existing contractual obligations, operating and capital lease obligations and current and prospective surety bonding needs; e. evaluate international operations; f. evaluate potential levers to reduce or defer fixed charges and other obligations in consideration of the Debtors' alternative capital structures; g. assist in developing a financial model to evaluate the Debtors' strategic alternatives and the impact thereof on the capital structure of the Debtors and develop a fully funded long-term business plan; h. assist in developing financial data and presentations for the Debtors' board and stakeholders; i. provide strategic and financial advice with regard to various financing, "M&A," restructuring and other strategic alternatives; j. assist in negotiating, evaluating and structuring potential transactions and related implementation strategies; k. assist in the development and distribution of selected information, documents and other materials, including, if appropriate, advising the Debtors in the preparation of an information memorandum; l. assist in the solicitation of capital investments or M&A proposals; m. provide advice in structuring the securities evidencing new investments and the restructuring of the Debtors' existing capital commitments and securities; n. assist in valuation matters, including the preparation of a valuation of the Debtors, their businesses and assets in connection with a transaction; o. evaluate significant aspects of the Debtors' near-term liquidity, and available financing and capital raising alternatives, including potential strategic and financial investor M&A alternatives; p. develop options and strategies for a financial restructuring, in- or out-of-court reorganization or other strategic alternatives for the Debtors, including participation in the negotiations among the Debtors and their stakeholders; and q. testify as an expert witness on any process and transactional issues that may require court approval. The firm will be compensated as follows: (i) An upfront fee of $3 million payable in two installments: $2 million due and payable prior to the Debtors' filing of the cases and $1 million due and payable after the debtor-in-possession financing with SB Investment Advisers (UK) Limited is paid in full. (ii) A monthly fee of $500,000. The monthly fees paid to Houlihan Lokey shall be credited against the recapitalization transaction fee or the sale transaction fee, as applicable. (iii) In addition to the upfront fees and monthly fees, Houlihan Lokey is entitled to the following transaction fees: a. Financing Transaction Fees. Financing transaction fees equal to the sum of: (i) 2.0 percent of the gross proceeds of any senior secured indebtedness; (ii) 4.0 percent of the gross proceeds of any other secured or unsecured indebtedness; and (iii) 6.0 percent of the gross proceeds of all equity or equity-linked securities (including, without limitation, convertible debt securities and preferred stock); provided, however, with respect to the Debtors' DIP financing with SBIA, the financing transaction fee shall be $1 million. b. Recapitalization Transaction Fee. Upon the earlier to occur of: (i) in the case of an out-of-court recapitalization transaction, the closing of such transaction; and (ii) in the case of an in-court recapitalization transaction, the date of consummation of a plan under the Bankruptcy Code, Houlihan Lokey will be paid a fee of $6 million. The recapitalization transaction fee shall be increased by each of the following "premiums:" 1) Pace Premiums: The recapitalization transaction fee shall be increased by (x) $2 million if the transaction is closed out-of-court, or (y) $1 million if the transaction is consummated through a plan confirmed under the Bankruptcy Code within 180 days of the petition date. 2) Recovery Premiums: The recapitalization transaction fee shall be increased by $1,000 for every 1.0 basis point in recoveries to unsecured creditors, determined as set forth in a disclosure statement or such other estimate of recoveries for unsecured recoveries or actual recoveries (i.e., if unsecured creditors recover 20 percent (or 2,000 basis points), the recapitalization transaction fee shall be increased by $2 million). c. Sale Transaction Fee. Upon the closing of a sale transaction or multiple sale transactions (all of which together shall constitute a sale transaction), Houlihan Lokey shall be paid a fee equal to the recapitalization transaction fee (inclusive of premiums, if applicable); provided that, in the event the Debtors consummate both a sale transaction and recapitalization transaction, the firm shall be entitled to receive only one transaction fee which shall be equal to the greater of: (x) the recapitalization transaction fee (inclusive of premiums, if applicable); and (y) the sale transaction fee. Notwithstanding the foregoing, upon the closing of each sale transaction, Houlihan Lokey shall be paid an incremental sale transaction fee equal to the lesser of (i) $500,000 and (ii) 25 percent of the AGC of the individual sale transaction or the so-called "incremental individual sale transaction fees," provided that 50 percent of the incremental individual sale transaction fees paid to Houlihan Lokey shall be credited against the recovery premium, which credits shall not reduce the recovery premium below zero. (iv) SBIA DIP Consent/Fee Deferral: In conjunction with the SBIA DIP, and in exchange for the DIP lender and Softbank and its affiliates' consent to and support of Houlihan Lokey's retention under the terms of the engagement agreement, notwithstanding (i) Houlihan Lokey having earned the $1 million deferred upfront fee and the $1 million SBIA DIP financing transaction fee, and (iii) any other fees Houlihan Lokey may earn prior to repayment or satisfaction in full of the SBIA DIP, the firm has agreed that all fees earned under the terms of the engagement agreement that have not already been paid as of the petition date of the Debtors' Chapter 11 cases shall be deferred and payable immediately upon repayment or satisfaction in full of the SBIA DIP. Matthew Niemann, shareholder of Houlihan, disclosed in a court filing that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Matthew R. Niemann Houlihan Lokey Capital, Inc. 1001 Fannin St., Suite 4650 Houston, TX 77002 Tel: 832-319-5150 Fax: 832-319-5151 About Katerra Inc. Based in Menlo Park, Calif., Katerra Inc. is a Japanese-funded, American technology-driven offsite construction company. Katerra was founded in 2015 by Michael Marks, former chief executive officer of Flextronics and former Tesla interim CEO, along with Fritz Wolff, the executive chairman of The Wolff Co. It offers technology-driven design, manufacturing, and assembly solution for bathroom pods, door and window, furniture, and modular utility systems. Katerra and its affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 21-31861) on June 6, 2021. In its petition, Katerra disclosed assets of between $500 million and $1 billion and liabilities of between $1 billion and $10 billion. Judge David R. Jones oversees the cases. The Debtors tapped Kirkland & Ellis, LLP and Jackson Walker, LLP as bankruptcy counsel; Houlihan Lokey Capital, Inc. as investment banker; Alvarez & Marsal North America, LLC as financial and restructuring advisor; and KPMG, LLP as tax consultant. Prime Clerk LLC is the claims and noticing agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases on June 22, 2021. The committee is represented by Fox Rothschild, LLP. KATERRA INC: Seeks to Hire Kirkland & Ellis as Legal Counsel ------------------------------------------------------------ Katerra, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Bankruptcy Court for the Southern District of Texas to hire Kirkland & Ellis, LLP and Kirkland & Ellis International, LLP to serve as legal counsel in their Chapter 11 cases. Kirkland's services will include: a. advising the Debtors with respect to their powers and duties in the continued management and operation of their businesses and properties; b. advising and consulting on the conduct of the cases, including all of the legal and administrative requirements of operating in Chapter 11; c. attending meetings and negotiating with representatives of creditors and other parties in interest; d. taking all necessary actions to protect and preserve the Debtors' estates, including prosecuting actions on the Debtors' behalf, defending any action commenced against the Debtors, and representing the Debtors in negotiations concerning litigation in which the Debtors are involved, including objections to claims filed against the Debtors' estates; e. preparing legal papers; f. representing the Debtors in connection with obtaining authority to continue using cash collateral and post-petition financing; g. advising the Debtors in connection with any potential sale of their assets; h. appearing before the bankruptcy court and any appellate courts; i. advising the Debtors regarding tax matters; j. taking any necessary action to negotiate, prepare, and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; and k. performing all other necessary legal services for the Debtors, including: (i) analyzing the Debtors' leases and contracts and the assumption and assignment or rejection thereof, (ii) analyzing the validity of liens against the Debtors' property, and (iii) advising the Debtors on corporate and litigation matters. Kirkland's hourly rates are as follows: Partners $1,080 - $1,895 per hour Of Counsel $625 - $1,845 per hour Associates $625 - $1,195 per hour Paraprofessionals $255 - $475 per hour In addition, Kirkland will seek reimbursement for expenses incurred. Kirkland provided the following in response to the request for additional information set forth in Paragraph D.1. of the Revised U.S. Trustee Guidelines: Question: Did Kirkland agree to any variations from, or alternatives to, Kirkland's standard billing arrangements for this engagement? Answer: No. Kirkland and the Debtors have not agreed to any variations from, or alternatives to, Kirkland's standard billing arrangements for this engagement. The rate structure provided by Kirkland is appropriate and is not significantly different from (a) the rates that Kirkland charges for other non-bankruptcy representations or (b) the rates of other comparably skilled professionals. Question: Do any of the Kirkland professionals in this engagement vary their rate based on the geographic location of the Debtors' Chapter 11 cases? Answer: No. The hourly rates used by Kirkland in representing the Debtors are consistent with the rates that Kirkland charges other comparable Chapter 11 clients regardless of the location of the Chapter 11 case. Question: If Kirkland has represented the Debtors in the 12 months prepetition, disclose Kirkland's billing rates and material financial terms for the prepetition engagement, including any adjustments during the 12 months prepetition. If Kirkland's billing rates and material financial terms have changed post-petition, explain the difference and the reasons for the difference. Answer: Kirkland's current hourly rates for services rendered on behalf of the Debtors range as follows: Billing Category Range of Hourly Rates Partners $1,080 - $1,895 per hour Of Counsel $625 - $1,845 per hour Associates $625 - $1,195 per hour Paraprofessionals $255 - $475 per hour Kirkland represented the Debtors during the period between Aug. 19 and Dec. 31, 2020 using the following hourly rates: Billing Category Range of Hourly Rates Partners $1,075 - $1,845 per hour Of Counsel $625 - $1,845 per hour Associates $610 - $1,165 per hour Paraprofessionals $245 - $460 per hour Question: Have the Debtors approved Kirkland's budget and staffing plan, and, if so, for what budget period? Answer: Yes, for the period from June 6 to Sept. 30, 2021. Joshua Sussberg, Esq., a partner at Kirkland, disclosed in a court filing that Kirkland is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. Kirkland can be reached through: Joshua A. Sussberg, Esq. Allyson B. Smith, Esq. Kirkland & Ellis LLP Kirkland & Ellis International LLP 601 Lexington Avenue New York, NY 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 Email: joshua.sussberg@kirkland.com allyson.smith@kirkland.com About Katerra Inc. Based in Menlo Park, Calif., Katerra Inc. is a Japanese-funded, American technology-driven offsite construction company. Katerra was founded in 2015 by Michael Marks, former chief executive officer of Flextronics and former Tesla interim CEO, along with Fritz Wolff, the executive chairman of The Wolff Co. It offers technology-driven design, manufacturing, and assembly solution for bathroom pods, door and window, furniture, and modular utility systems. Katerra and its affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 21-31861) on June 6, 2021. In its petition, Katerra disclosed assets of between $500 million and $1 billion and liabilities of between $1 billion and $10 billion. Judge David R. Jones oversees the cases. The Debtors tapped Kirkland & Ellis, LLP and Jackson Walker, LLP as bankruptcy counsel; Houlihan Lokey Capital, Inc. as investment banker; Alvarez & Marsal North America, LLC as financial and restructuring advisor; and KPMG, LLP as tax consultant. Prime Clerk LLC is the claims and noticing agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases on June 22, 2021. The committee is represented by Fox Rothschild, LLP. KATERRA INC: Taps Alvarez & Marsal as Restructuring Advisor ----------------------------------------------------------- Katerra, Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Bankruptcy Court for the Southern District of Texas to hire Alvarez & Marsal North America, LLC as their restructuring advisor, and designate Christopher Wells as chief restructuring officer and Marc Liebman as chief transformation officer. The firm's services will include: (a) assisting with financial and liquidity forecasting, including but not limited, to the development of a 13-week cash flow and liquidity forecast; (b) assisting in the identification of liquidity and cash flow improvement opportunities for the Debtors' operations, including without limitation, a review of capital expenditures to identify potential cost savings; (c) developing restructuring plans or strategic alternatives for maximizing the enterprise value of the Debtors' various business lines; (d) assisting the Debtors and their legal counsel in contingency planning; (e) developing forecasts and information for, and seeking to obtain court approval of, the use of cash collateral or debtor-in-possession financing and related compliance and reporting; (f) assisting the overall financial reporting division in managing the administrative requirements of the Bankruptcy Code, including post-petition reporting requirements and claim reconciliation efforts; (g) assisting the Debtors and their investment banker in connection with the potential marketing and sale of substantially all of the Debtors' assets; (h) assisting the Debtors in the preparation of financial-related disclosures required by the court; (i) assisting the Debtors in identifying executory contracts and leases and in performing evaluations to support their analysis and decision to assume or reject each contract and lease; (j) assisting the Debtors with data preservation, and developing and implementing system transitions associated with the sales of business units; (k) assisting the Debtors with their winddown plans, including planning and execution; (l) communicating with the Debtors' stakeholders; and (m) other services in connection with the restructuring process requested or directed by the boards of directors of the Debtors and other authorized personnel. The firm's hourly rates are as follows: Restructuring: Managing Directors $925 - 1,200 per hour Directors $725 - 900 per hour Analysts / Associates $425 - 700 per hour Case Management Services: Managing Directors $900 - 1,050 per hour Directors $675 - 800 per hour Analysts / Consultants $400 - 650 per hour As disclosed in court filings, Alvarez & Marsal is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Christopher J. Wells Alvarez & Marsal North America, LLC 700 Louisiana Street, Suite 3300 Houston, Texas, 77002 Tel: +1 713 571 2400 Fax: +1 713 547 3697 Email: cwells@alvarezandmarsal.com About Katerra Inc. Based in Menlo Park, Calif., Katerra Inc. is a Japanese-funded, American technology-driven offsite construction company. Katerra was founded in 2015 by Michael Marks, former chief executive officer of Flextronics and former Tesla interim CEO, along with Fritz Wolff, the executive chairman of The Wolff Co. It offers technology-driven design, manufacturing, and assembly solution for bathroom pods, door and window, furniture, and modular utility systems. Katerra and its affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 21-31861) on June 6, 2021. In its petition, Katerra disclosed assets of between $500 million and $1 billion and liabilities of between $1 billion and $10 billion. Judge David R. Jones oversees the cases. The Debtors tapped Kirkland & Ellis, LLP and Jackson Walker, LLP as bankruptcy counsel; Houlihan Lokey Capital, Inc. as investment banker; Alvarez & Marsal North America, LLC as financial and restructuring advisor; and KPMG, LLP as tax consultant. Prime Clerk LLC is the claims and noticing agent. The U.S. Trustee for Region 7 appointed an official committee of unsecured creditors in the Debtors' Chapter 11 cases on June 22, 2021. The committee is represented by Fox Rothschild, LLP. KKR APPLE: Moody's Assigns First Time B2 Corporate Family Rating ---------------------------------------------------------------- Moody's Investors Service has assigned first-time ratings to KKR Apple Bidco, LLC ("Atlantic" or the "company"), including a B2 Corporate Family Rating and a B2-PD Probability of Default Rating. Concurrently, Moody's assigned B1 ratings to the company's first lien senior secured credit facilities and a Caa1 rating to the second lien senior secured term loan. Proceeds from the credit facilities, along with sponsor-contributed equity will be used to fund the acquisition of Atlantic Aviation by KKR & Co. Inc. for $4.5 billion. The rating outlook is stable. Ratings on existing debt under Atlantic Aviation FBO, Inc.'s term loan and revolving credit facilities will be withdrawn upon its retirement, which Moody's expects to occur concurrent with the closing of the acquisition. The following is a summary of the rating actions: Assignments: Issuer: KKR Apple Bidco, LLC Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Senior Secured 1st Lien Revolving Credit Facility, Assigned B1 (LGD3) Senior Secured 1st Lien Term Loan B, Assigned B1 (LGD3) Senior Secured 2nd Lien Term Loan, Assigned Caa1 (LGD6) Outlook Actions: Issuer: KKR Apple Bidco, LLC Outlook, Assigned Stable RATINGS RATIONALE The B2 CFR balances high financial leverage and heavy exposure to the cyclical general aviation market against Atlantic's strong position as the second largest fixed-base operator (FBO) within the US. Moody's expects an aggressive financial policy that will limit near-term financial flexibility and require strong execution of operations. Pro forma debt-to-EBITDA will be above 7x and free cash generation will be limited in 2021 and 2022, as the company makes significant growth-oriented capex investments. Following wide-spread disruptions to business jet travel patterns during the coronavirus pandemic, Moody's expects the recovery in general aviation traffic volumes to continue through 2022. This will translate into higher fuel sales, earnings growth and a gradual improvement in Atlantic's credit metrics. That said, the coronavirus pandemic has been very disruptive to Atlantic's corporate customer base, which has historically accounted for the majority of sales, and the ultimate degree and timing of a recovery in corporate demand remains uncertain at this time. The B2 CFR is supported by Atlantic's scale advantages that arise from its geographically diverse footprint of 69 locations, many of which are situated in high traffic metropolitan locations. Atlantic's leading industry margins speak to its good competitive standing within the highly fragmented FBO industry where the company benefits from its position as either the sole or joint provider of FBO services at 75% of its locations. Meaningful barriers to entry, including long-dated leases and limited developable land at many FBO airports, add further credit support. Moody's views governance risk as material given the private-equity ownership of Atlantic Aviation. Moody's anticipates an aggressive financial policy that prioritizes shareholder returns over creditors and that results in high financial leverage and periodic debt-funded acquisitions. The stable outlook reflects Moody's expectations of a continued recovery in general aviation traffic that will support earnings growth and a steady operating profile. Moody's expects Atlantic to maintain adequate liquidity over the next 12 to 18 months. Cash will be around $20 million at the close of the transaction. Moody's expects minimal free cash generation during 2021 and 2022, as the company makes growth-oriented, discretionary capex investments. Amortization on term debt is modest at 1% or $13 million per annum and Atlantic has no near-term principal obligations. External liquidity is provided by a $225 million revolving credit facility that expires in August 2026. Moody's does not expect Atlantic to be reliant on the facility. The revolver contains a springing first lien net leverage ratio of 9.5x that comes into effect when revolver usage exceeds the greater of $90 million or 40% of the facility. Moody's does not expect the term loans to contain any financial covenants. The proposed new credit facilities provide covenant flexibility for transactions that could adversely affect creditors, including incremental first lien debt capacity up to the sum of the greater of $240 million and 100% of Consolidated EBITDA, plus amounts available under the general debt basket, plus an unlimited amount up to 5.5x First Lien Leverage Ratio (if pari passu secured). Amounts up to the greater of $450 million and 200% of Consolidated EBITDA, and any incremental first lien term facility incurred in connection with a permitted acquisition or investment may be incurred with an earlier maturity date than the initial term loans. Subsidiaries are only required to provide guarantees if wholly-owned, raising the risk that a sale or disposition of partial equity interests could trigger a guarantee release, with no explicit protective provisions limiting such guarantee releases. There are no express "blocker" provisions which prohibit the transfer of specified assets to unrestricted subsidiaries; such transfers are permitted subject to carve-out capacity and other conditions. There are no express protective provisions prohibiting an up-tiering transaction. The above are proposed terms and the final terms of the credit agreement may be materially different. The B1 rating on senior secured first lien indebtedness comprised of the revolving credit facility and the term loan is one notch above the B2 (CFR), reflecting this debt class' seniority within the company's capital structure, including the benefits of predominantly all-asset liens and both upstream and downstream guarantees. The Caa1 rating for the second lien term loan reflects its junior position compared to the aforementioned first lien lenders. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Given Atlantic's high financial leverage, Moody's does not anticipate any upward rating pressure through at least 2022. That said, over time ratings could be upgraded with improved liquidity with free cash flow-to-debt consistently in the mid-single digits and debt-to-EBITDA sustained in the low 5x range. Factors that could lead to a downgrade include an unanticipated weakening, or a slower than expected recovery, in general aviation traffic volumes that constrain operating margins. A downgrade could also occur with weakening liquidity, such that free cash flow-to-debt were to remain in the low-single digits beyond 2022, or if debt-to-EBITDA was expected to be sustained above 7x. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. Atlantic Aviation FBO, Inc. ("Atlantic"), headquartered in Plano, Texas, has fixed base operator (FBO) locations at 69 general aviation airports in the US. The company's FBOs provide fueling and fuel related services, aircraft parking and hangar services to owners/operators of jet aircraft, primarily in the general aviation sector of the air transportation industry, but also to commercial, military, freight and government aviation customers. Atlantic is owned by KKR & Co. Inc. Gross revenues were $947 million for the twelve months ended March 31, 2021. KLAUSNER LUMBER: Unsecureds to Receive $7.2 million --------------------------------------------------- Klausner Lumber One LLC and Official Committee of Unsecured Creditors submitted a Second Amended Joint Chapter 11 Plan. Pursuant to Section 1123 of the Bankruptcy Code and Bankruptcy Rule 9019, the Plan incorporates the "Plan Settlement," which is a compromise and global settlement among the Plan Settlement Parties of numerous debtor-creditor issues designed to achieve an economic resolution of Claims against the Debtor, claims that may be asserted against Florida Sawmills and the Affiliates and an efficient resolution of the Chapter 11 Case. The Plan Settlement effects, among other things, the allowance, compromise, treatment and satisfaction of all Claims asserted or which may be asserted by Florida Sawmills and the Affiliates in the Chapter 11 Case, which collectively were asserted to be in the amount of approximately $180 million. Confirmation of the Plan will constitute the Bankruptcy Court's approval of the Plan Settlement under Bankruptcy Rule 9019 and section 1123 of the Bankruptcy Code (with respect to the Plan Settlement Parties) and shall constitute a finding that the compromises and settlements proposed in the Plan Settlement are in the best interest of the Debtor, its estate, its creditors, and other parties-in-interest and are fair, equitable, and within the range of reasonableness. Each provision of the Plan Settlement is considered non-severable from each other and from the remaining terms of the Plan. The Plan Settlement also amicably resolves all disputes among the Plan Settlement Parties concerning alleged Claims in Class 1 (FS Secured Claims), Class 2 (Affiliate Secured Claims), Class 4 (FS Deficiency/Unsecured Claims), Class 6 (Affiliate Unsecured Claims), and Class 7 (Subordinated Claims), and the potential distributions to Holders of Allowed Claims in Class 5 (General Unsecured Claims). Payment of Net Distribution Proceeds In the event the Net Distribution Proceeds to be distributed under the Plan are $30 million, the Settlement Parties agree to the following sharing of the available Net Distribution Proceeds between Classes 4, 5, and 6 pursuant to the Plan, subject to adjustment pursuant to Paragraphs 4 and 5 of the Plan Support and Settlement Term Sheet: i. Class 4 (FS Deficiency/Unsecured Claims) shall receive $19 million of Net Distribution Proceeds (the "Class 4 Distribution Amount") for distribution on account of the Allowed Florida Sawmills Claim (the sole Allowed Claim in Class 4). ii. Class 5 (General Unsecured Claims) shall receive $7.2 million of Net Distribution Proceeds (the "Class 5 Distribution Amount"), for distribution Pro Rata on account of the Allowed Class 5 General Unsecured Claims. iii. Class 6 (Affiliate Unsecured Claims) shall receive $3.8 million of Net Distribution Proceeds (the "Class 6 Distribution Amount") for distribution on account of the Allowed Affiliate Claims, provided, however, that if the total amount of the Allowed Class 5 General Unsecured Claims is less than $7.2 million (such that the distribution to Class 5 above results in 100% recovery to Allowed Claims in Class 5), then from the portion of the Class 5 Distribution Amount which exceeds the total amount of Allowed Class 5 General Unsecured Claims, (i) the first up to $200,000 (that would have otherwise been distributed to Allowed Class 5 General Unsecured Claims), will be added to and become part of the Class 6 Distribution Amount and be distributed to the Affiliates to bring their total recovery to a possible maximum amount of $4 million, and (ii) any excess amount above $200,000 will be split equally (e.g., 50%/50%) between the Class 4 Distribution Amount and the Class 6 Distribution Amount Net Distribution Proceeds in Excess of $30 million In the event that the Net Distribution Proceeds exceed $30 million, the Class 4 Distribution Amount will be increased by the first additional $1 million of Net Distribution Proceeds (i.e., Net Distribution Proceeds between $30 million and $31 million) to a maximum possible amount of $20 million. Thereafter, Net Distribution Proceeds in excess of $31 million shall be split equally (e.g., 33% to each Class) among the Class 4 Distribution Amount, the Class 5 Distribution Amount, and the Class 6 Distribution Amount until the Class 5 General Unsecured Claims are fully paid. If the Class 5 Distribution Amount exceeds the total amount of Allowed Class 5 General Unsecured Claims as a result of this paragraph, the excess shall be split equally among only the Class 4 Distribution Amount and the Class 6 Distribution Amount. Net Distribution Proceeds Less than $30 million In the event that the Net Distributions Proceeds are less than $30 million, the Parties agree that the Class 4 Distribution Amount, the Class 5 Distribution Amount, and the Class 6 Distribution Amount will be proportionally reduced in the ratio contemplated in Paragraph 3 hereof, such that the Class 4 Distribution Amount will be 63.33% of available Net Distribution Proceeds, the Class 5 Distribution Amount will be 24% of the available Net Distribution Proceeds, and the Class 6 Distribution Amount will be 12.67% of available Net Distribution Proceeds. The Post-Confirmation Debtor will fund distributions under the Plan with the Post-Confirmation Estate Assets and the Distribution Proceeds. Attorneys for the Debtor: Thomas A. Draghi Alison M. Ladd WESTERMAN BALL EDERER MILLER ZUCKER & SHARFSTEIN, LLP 1201 RXR Plaza Uniondale, New York 11556 Telephone: (212) 622-9200 Facsimile: (212) 622-9212 Robert J. Dehney Eric Schwartz Daniel B. Butz MORRIS, NICHOLS, ARSHT & TUNNELL LLP 1201 North Market Street, 16th Floor P.O. Box 1347 Wilmington, Delaware 19899 Telephone: (302) 658-9200 Facsimile: (302) 658-3989 Attorneys for the Official Committee of Unsecured Creditors: Richard J. Bernard FAEGRE DRINKER BIDDLE & REATH LLP 1177 Avenue of the Americas, 41st Floor New York, New York 10036 Richard.Bernard@faegredrinker.com Direct: (212) 248-3263 Alissa M. Nann FOLEY & LARDNER LLP 90 Park Avenue New York, NY 10016 Tel: (212) 682-7474 Fax: (212) 687-2329 Eric J. Monzo Brya M. Keilson MORRIS JAMES LLP 500 Delaware Avenue, Suite 1500 Wilmington, DE 19801 Tel: (302) 888-6800 Fax: (302) 571-1750 A copy of the Disclosure Statement is available at https://bit.ly/3qHNvLt from PacerMonitor.com. About Klausner Lumber One Klausner Lumber One, LLC, is a privately-held company in the lumber and plywood products manufacturing industry. It is 100% owned by non-debtor Klausner Holding USA, Inc. Klausner Lumber One sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Case No. 20-11033) on April 30, 2020. At the time of the filing, Debtor disclosed assets of between $100 million and $500 million and liabilities of the same range. Judge Karen B. Owens oversees the case. The Debtor has tapped Westerman Ball Ederer Miller Zucker & Sharfstein, LLP as its bankruptcy counsel; Morris, Nichols, Arsht & Tunnell, LLP as local counsel; Asgaard Capital, LLC as restructuring advisor; and Cypress Holdings, LLC, as investment banker. The Office of the U.S. Trustee appointed a committee to represent unsecured creditors in the Debtor's Chapter 11 case. The committee tapped Foley & Lardner LLP and Faegre Drinker Biddle & Reath LLP as its counsel. LABL INC: Clayton Acquisition No Impact on Moody's B3 Rating ------------------------------------------------------------ Moody's Investors Service said all ratings of LABL, Inc. (B3 stable) are unchanged following the company's announcement on July 2 that that Clayton, Dublier & Rice funds will acquire it from Platinum Equity for an undisclosed sum and combine it with Fort Dearborn Holding Company, Inc. (B3 stable). LABL, Inc. is a holding company for Multi-Color Corporation, a global label business. The company said transactions are expected to close by the end of 2021, subject to customary regulatory approvals and other conditions. Moody's views the merger of two label companies with complementary businesses as credit positive as the transaction increases consolidation in the fragmented market. LABL, Inc. grew through acquisitions and has a levered balance sheet. LABL, Inc. ratings will depend on the surviving entity, funding structure and ultimate debt level of the future combined company. Clayton, Dublier & Rice has not disclosed the proposed funding structure at this time. The combined company will have pro forma sales of $2.7 billion in the twelve months ended March 31, 2021, with concentration in North America. Fort Dearborn is primarily a domestic company, while Multi-Color Corporation is a global company. Separately, LABL also announced that it signed a definitive agreement to acquire Hexagon Holdings ("Hexagon"), an Auckland, New Zealand-based provider of high-value premium labels, for an undisclosed sum. Headquartered in Cincinnati, OH, LABL, Inc. is a provider of pressure sensitive labels, flexible film packaging and other packaging solutions for the food and beverage, health and beauty, and consumer products markets. The company changed its name to LABL from W/S Packaging in June 2019 and in July it completed a merger with Multi-Color Corporation. The company operates 75 manufacturing facilities in 27 countries and generated revenue of approximately $2.1 billion in the twelve months ended March 31, 2021. LABL has been a portfolio company of Platinum Equity since 2018. LAS VEGAS SANDS: Egan-Jones Keeps BB- Unsec. Debt Ratings --------------------------------------------------------- Egan-Jones Ratings Company, on June 14, 2021, maintained its 'BB-' foreign currency and local currency senior unsecured ratings on debt issued by Las Vegas Sands Corp. Headquartered in Las Vegas, Nevada, Las Vegas Sands Corp owns and operates casino resorts and convention centers. LATAM AIRLINES: Court Extends Bankruptcy Plan Deadline to September ------------------------------------------------------------------- Andrew Curran of Simple Flying reports that a United States Federal Court has approved extending the submission date of LATAM's restructuring plan to mid-September 2021. The South American airline was due to present its restructuring plan by the end of June. On Monday, the Federal Court from the southern district of New York extended that deadline to September 15, 2021. As part of the bankruptcy protection process, LATAM was due to present its restructuring plan to the Federal Court by June 30. 2021. But earlier last month, the Chile-based airline indicated it would seek an extension. "The extension request is a common alternative contemplated within the process and does not modify the intention of the LATAM group to exit Chapter 11 by the end of this 2021," Simple Flying reported a LATAM spokesperson saying. Monday's, July 5, 2021, court hearing confirmed the extension. LATAM remains confident it will safely emerge from the bankruptcy process, and the airline has remained flying throughout -- albeit at a reduced level. LATAM's passenger operation for June 2021 was estimated to reach 36% (measured in available seats-kilometers) relative to the same month in 2019. In June 2021, LATAM estimated operating approximately 691 daily domestic and international flights, connecting 114 destinations across 14 countries. LATAM remains a significant operator in Brazil, Chile, Colombia, Ecuador, and Peru. However, the airline is exiting the Argentinian market. LATAM has also confirmed it was accessing a further US$500 million from debtor-in-possession funding. This is the airline's second withdrawal from the fund. Administrators made up to US$2.45 billion available to LATAM under the funding provisions. To date, the airline had accessed $1.15 billion. About LATAM Airlines Group LATAM Airlines Group S.A. -- http://www.latam.com/-- is a pan-Latin American airline holding company involved in the transportation of passengers and cargo and operates as one unified business enterprise. It is the largest passenger airline in South America. Before the onset of the COVID-19 pandemic, LATAM offered passenger transport services to 145 different destinations in 26 countries, including domestic flights in Argentina, Brazil, Chile, Colombia, Ecuador and Peru, and international services within Latin America as well as to Europe, the United States, the Caribbean, Oceania, Asia and Africa. LATAM and its 28 affiliates sought Chapter 11 protection (Bankr. S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in Chile, Peru, Colombia, Ecuador and the United States are part of the Chapter 11 filing. The Debtors disclosed $21,087,806,000 in total assets and $17,958,629,000 in total liabilities as of Dec. 31, 2019. The Hon. James L. Garrity, Jr., is the case judge. The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as bankruptcy counsel, FTI Consulting as restructuring advisor, Lee Brock Camargo Advogados as local Brazilian litigation counsel, and Togut, Segal & Segal LLP and Claro & Cia in Chile as special counsel. The Boston Consulting Group, Inc. and The Boston Consulting Group UK LLP serve as the Debtors' strategic advisors. Prime Clerk LLC is the claims agent. The official committee of unsecured creditors formed in the case tapped Dechert LLP as its bankruptcy counsel, Klestadt Winters Jureller Southard & Stevens, LLP as conflicts counsel, UBS Securities LLC as investment banker, and Conway MacKenzie, LLC as financial advisor. Ferro Castro Neves Daltro & Gomide Advogados, is the committee's Brazilian counsel. The Ad Hoc Group of LATAM Bondholders tapped White & Case LLP as counsel. Glenn Agre Bergman & Fuentes, LLP, led by managing partner Andrew Glenn and partner Shai Schmidt, has been retained as counsel to the Ad Hoc Committee of Shareholders. LAUREATE EDUCATION: Moody's Withdraws B1 Corporate Family Rating ---------------------------------------------------------------- Moody's Investors Service withdrew its ratings for Laureate Education, Inc., including the B1 corporate family rating, B1-PD probability of default rating, SGL-2 speculative grade liquidity rating, and Ba3 rating of the senior secured credit facility. The negative outlook was also withdrawn. Withdrawals: Issuer: Laureate Education, Inc. Corporate Family Rating, Withdrawn , previously rated B1 Probability of Default Rating, Withdrawn , previously rated B1-PD Speculative Grade Liquidity Rating, Withdrawn , previously rated SGL-2 Senior Secured 1st Lien Bank Credit Facility, Withdrawn , previously rated Ba3 (LGD3) Outlook Actions: Issuer: Laureate Education, Inc. Outlook, Changed To Rating Withdrawn From Negative RATINGS RATIONALE Moody's has decided to withdraw the ratings for its own business reasons. Laureate, based in Baltimore, Maryland, operates a leading international network of accredited campus-based and online universities with 4 universities and 1 technical-vocation school in Mexico and Peru, offering academic programs to over 360,000 students at over 50 campuses and online delivery. LERETA LLC: Moody's Assigns First Time B2 Corporate Family Rating ----------------------------------------------------------------- Moody's Investors Service assigned first time ratings to LERETA, LLC, including a B2 corporate family rating and B2-PD probability of default rating, and B2 instrument ratings on both a new, $30 million first-lien revolving credit facility due 2026 and a new $250 million first lien term loan due 2028. The outlook is stable. Proceeds from the proposed first-lien term loan along with new common equity and rollover equity will be used by the private equity firms Flexpoint Ford and Vestar Capital Partners to acquire LERETA. Governance is a key ESG consideration in the ratings assignment reflecting the company's private-equity ownership structure and aggressive financial policy. Assignments: Issuer: LERETA, LLC Corporate Family Rating, Assigned B2 Probability of Default Rating, Assigned B2-PD Senior Secured First Lien Revolving Credit Facility, Assigned B2 (LGD3) Senior Secured First Lien Term Loan, Assigned B2 (LGD3) Outlook Actions: Issuer: LERETA, LLC Outlook, Assigned Stable RATINGS RATIONALE The B2 CFR reflects LERETA's small scale, narrow operating scope with exposure to the housing market and economic cycles and high Moody's adjusted opening pro-forma debt to EBITDA of 6.1x (including capitalized software as an expense). LERETA's business is focused on the tax and flood determination portion of a mortgage application and the company serves a niche area of the overall mortgage process. Revenue is dependent on the volume of originations that include both purchase and refinancing originations. In a rising interest rate environment, the volume of originations drops since refinancing activity falls. The company also has exposure to economic cycles since during times of stress fewer people opt to purchase homes. LERETA's scale is also small for the rating category with a sub $200 million annual revenue. The company's largest competitor is several times its size and provides services in other areas of mortgage servicing in which LERETA does not have a presence. Thus, competitive pressure is a credit consideration that weighs on the rating. LERETA benefits from a revenue profile that consists of highly re-occurring earnings. The company's customer base is very diverse with over 2,000 customers that includes national level and regional lenders and mortgage servicers. The company performs an essential part of the mortgage process and manages tax records and payments for over 22,000 tax agencies nationally. Outsourcing this process to a vendor such a LERETA is a cost-efficient way to manage the large volume of tax reporting that needs to be done by a lender. Moody's expects this trend of outsourcing to continue and will support the earnings of LERETA. LERETA is the second largest tax servicer nationally and counts many of the largest national mortgage originators as clients, which provides a steady volume of loans to service. The credit is also supported by strong customer retention with an average customer tenor of six years. The company's high debt-to-EBITDA leverage pressures the ratings. Moody's expects the measure to increase to approximately 7.1x by the end of this year and decline to 6.3x by the end of 2022. The increase in leverage from opening leverage is due to higher capitalized software expenses this year as the company re-platforms its IT systems to cloud technology. Free cash flow to debt is strong at around 9% for the LTM period ended March 2021 and due to the investments in technology and scalability of the business Moody's expects this measure to remain strong and in the 6.5%-8.0% range for the next 12-18 months. Moody's calculation of leverage treats capitalized software as an expense and includes standard adjustments. Excluding the capitalized software adjustment, opening adjusted leverage is 5.4x and would be 5.2x at the end of this year. The stable outlook reflects Moody's view that LERETA will be able to maintain annual revenue growth in the low-single digit area on average over the next few years, driven by new customer growth and re-occuring volume from existing customers, balanced by lower refinancing origination volumes. The stable outlook also incorporates the expectation that the mortgage market and demand for housing will remain robust at least for the next 12-18 months, that customer concentration will decline as the company grows and gains new customers and that there is no loss of any large customers. The outlook does not assume any debt funded acquisitions. Moody's expects the macro environment that will drive demand for housing to remain solid over the next 12-18 months although purchase and refinancing activity will likely not be as strong as levels seen in 2020. A combination of a strengthening labor market, improving economy in general and rising house prices due to historically low inventory levels will help lift purchase originations. However, refinancing activity will decline due to higher mortgage rates. Over the longer run, demographic trends will support demand for housing since more millennials are approaching peak homebuyer age and this portion of the population is currently the largest age cohort. Moody's views LERETA's liquidity as good. Liquidity is supported by an expected opening cash balance between $5 million and $10 million and a $30 million revolver that matures in 2026 that will be undrawn. Free cash flow is expected to be approximately $20 million over the next 12 months. Cash needs over the next 12 months includes minimal working capital usage and low maintenance capex of around $3 million annually. The credit facilities will be subject to a leverage based financial maintenance covenant. The B2 ratings on LERETA's senior secured first lien credit facilities reflect both the probability of default rating of B2-PD and the loss given default assessment of LGD3. The senior secured first lien credit facilities benefit from secured guarantees from all existing and subsequently acquired wholly-owned domestic subsidiaries. As there is no other meaningful debt in the capital structure, the facilities are rated in line with the B2 CFR. Under Moody's ESG risk framework LERETA's risks under social considerations are low despite the large amount of information that the company has access to and manages. The tax and flood information for a particular property is publicly available information that can be accessed by anyone and thus is not sensitive or confidential information. As a result of the change in ownership structure via the LBO, LERETA's corporate governance policy presents risks through both the high financial leverage employed and private equity ownership, which typically places shareholder interests above those of creditors. Moody's expects aggressive financial policies could sustain high levels of leverage, including debt-funded M&A transactions and other shareholder-friendly policies. As proposed, the new credit facility is expected to provide covenant flexibility that, if utilized, could negatively impact creditors, including: (i) an incremental first-lien facility capacity not to exceed the sum of (x) the greater of closing date EBITDA and LTM EBITDA, plus (y) an amount such that the first lien net leverage ratio does not exceed 5.0x (for pari passu secured debt). In addition, no portion of the incremental may be incurred with an earlier maturity than the initial term loan; (ii) The credit agreement permits the transfer of assets to unrestricted subsidiaries, up to the carve-out capacities, subject to "blocker" provisions, which prohibit the transfer or exclusive licensing of any intellectual property that is material to the business and operations of the borrower and its restricted subsidiaries (taken as a whole) to any unrestricted subsidiary; (iii) Non-wholly-owned subsidiaries are not required to provide guarantees; dividends or transfers resulting in partial ownership of subsidiary guarantors could jeopardize guarantees subject to protective provisions which only permit guarantee releases if there is a bona fide purpose for such transfer and it is not intended solely to obtain a release from the guarantee; and (iv) The credit agreement provides some limitations on up-tiering transactions, including the requirement that 100% of lenders consent to amendments subordinating the payment priority of the obligations or the liens to any other debt. The proposed terms and the final terms of the credit agreement may be materially different. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS The ratings could be upgraded if Moody's expects: 1) Material increase in size and scale via organic growth or acquisitions 2) debt to EBITDA (Moody's adjusted and including capitalized software development cost as an expense) will remain below 6.0x; 3) free cash flow to debt sustained at least at 7% of total debt; 4) balanced financial policies; and 5) good liquidity will be maintained. A ratings downgrade could result if: 1) revenue visibility or EBITDA margins decline due to increased competition, regulatory changes, loss of customers or other factors; 2) debt to EBITDA (Moody's adjusted and including capitalized software development cost as an expense) is expected to remain above 7.0x; 3) free cash flow to debt is anticipated below 3.0%; 4) liquidity deteriorates; or 5) LERETA pursues aggressive shareholder-friendly financial policies, including debt-funded acquisitions or shareholder returns. Headquartered in Pomona, California, LERETA is a technology enabled property tax and flood determination service provider to the financial services industry. The company provides services in the areas of tax certification management and flood determination to mortgage originators and servicers. Subsequent to the transaction LERETA will be owned by Flexpoint Ford and Vestar Capital Partners. The company generated $155 million in revenue for the LTM March 31, 2021 period. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. LERETA LLC: S&P Assigns 'B-' Issuer Credit Rating, Outlook Stable ----------------------------------------------------------------- S&P Global Ratings assigned its 'B-' issuer credit rating to Calif.-based property data and analytics provider Lereta LLC and its 'B-' issue-level and '3' recovery ratings to its senior secured debt. Flexpoint Ford and Vestar Capital Partners are acquiring Pomona, Lereta. The company will have a new capital structure which includes a $30 million senior secured revolving credit facility (undrawn at close) and a $250 million senior secured term loan. S&P said, "The stable outlook reflects our expectation for adjusted leverage between 5x – 7x and adequate levels of liquidity over the next year. However, we anticipate lower refinancing volumes will result in organic revenue declines of up to 2%. We are forecasting Lereta's leverage will be in the high-5x area in 2021 ticking above 6x in 2022, because of lower mortgage origination and increased technology spend. Lereta has small scale and competes as the second largest player in the mortgage tax servicing market, while CoreLogic maintains a dominant market share. Lereta had $160 million in 2020 reported revenue, with about a 15% market share and a focus on the smaller, middle-market servicers. Corelogic has much greater scale and occupies the leading position in the mortgage tax servicing market, with long-term relationships with many of the largest financial institutions. There is customer concentration for Lereta as well, with about 30% of 2020 revenues coming from the company's top 10 clients." The company has a relatively low percentage of recurring fixed revenue: -- 19% of revenues come from recurring "per-loan, per-month" outsourcing fees; -- 74% of revenue is re-occurring and transactional in nature, based on fees paid at origination; and -- 7% of revenues are purely nonrecurring. The company's competitive advantage includes relationships and expertise with more than 22,000 tax jurisdictions, which provides some barriers to entry, and an integrated platform embedded in its clients workflows contributing to high customer retention rates. Lereta has integrated partnerships with Black Knight and Ellie Mae, which contributes to new customer wins. S&P believes the company has pricing power for its mission-critical tax services business, in that the up-front payment at origination is a relatively small percentage of overall closing costs. S&P said, "We expect Lereta's S&P Global Ratings-adjusted debt to EBITDA will be in the high-5x area for 2021 following the LBO. As a sponsor owned company, we expect Lereta to have a more aggressive financial policy. We forecast the Company will experience steep revenue declines of 15%-17% in 2021, driven by the recent loss of its largest customer which represented 14% of 2020 revenues. We forecast leverage will exceed 6x in 2022, as declines in mortgage origination volumes, particularly refinancing activity, weigh on operating performance." Lereta is exposed to the cyclicality in the mortgage market, and rising interest rates could hinder revenue growth. S&P said, "We estimate about one-third of revenue for the Lereta is tied to residential mortgage refinancing volumes, one-third comes from residential mortgage purchasing volumes, and the remaining one-third comes from other services such as commercial mortgage, reverse mortgage, and tax outsourcing. We believe refinancing volumes will experience severe declines of nearly 70% in 2022, as interest rates begin to rise and refinancing demand has already been satisfied, and more modest declines from purchasing volumes, leading to 0%-2% revenue declines for the company overall in 2022." Partially offsetting the expected difficult mortgage environment in 2022 is a large new contract win from a top five servicer, as it diversifies its vendors, and a regional, middle-market customer focus which is less refinancing dependent. S&P said, "We expect margins to decline by about 200 –300 basis points over the next 12 months as mortgage origination volumes come down and Lereta invests in its technology platform. Lereta has high operating leverage driven by the overall volume of mortgage origination, and we expect a declining mortgage market will pressure profitability. The company has significant software development costs for its core platform and uses both internal and external sources of labor, which we expect will increase in 2022, further weighing on margins. Lereta has been implementing cost-saving measures and transitioning to the Microsoft cloud, which we anticipate will cost about $4 million in 2021 and 2022 and will result in a run-rate savings of $3 million-$4 million by 2024. The company has a deferred revenue component of its tax solutions business, which we expect will benefit working capital and lead to cash inflow in a growing origination environment, and hurt working capital and lead to cash outflow in a declining origination environment. Nevertheless, we expect only modest working capital needs over the next 12 months will contribute to steady free cash flow generation of $20 million-$30 million. "The stable outlook reflects our expectation for adjusted leverage between 5x – 7x over adequate levels of liquidity over the next year. However, we anticipate lower refinancing volumes will result in organic revenue declines of up to 2%. We are forecasting Lereta's leverage will be in the high-5x area in 2021 ticking above 6x in 2022, because of lower mortgage origination and increased technology spend. "We could downgrade Lereta over the next 12 months if lower mortgage origination volumes lead to greater-than-expected revenue declines or lower profitability because of reduced operating leverage or the loss of customers." A downgrade would like be consistent with: -- Negative free operating cash flow generation, or -- A capital structure we considered to be unsustainable, or -- Debt-financed acquisitions or shareholder returns. S&P could upgrade Lereta over the next 12 months if it demonstrates strong operating performance with: -- Sustained organic revenue growth of 4% or more; -- EBITDA margins sustained at above average levels relative to technology software and services peers; and -- Leverage sustained below 5x. This would most likely result from capturing greater market share from its biggest competitor, significant new customer wins, and demonstrated earnings stability through mortgage origination cycles. LIVEXLIVE MEDIA: Increases Available Shares Under Incentive Plan ---------------------------------------------------------------- LiveXLive Media, Inc. has amended its 2016 Equity Incentive Plan to increase the number of shares available for issuance under the plan by 5,000,000 shares, which increase was previously approved by the Company's board of directors and its stockholders at its 2020 annual meeting of stockholders. About LiveXLive Media Headquartered in West Hollywood, CA, LiveXLive -- http://www.livexlive.com-- is a global digital media company focused on live entertainment. The Company operates LiveXLive, a live music video streaming platform; and Slacker Radio, a streaming music pioneer; and also produces original music-related content. LiveXLive is at 'live social music network', delivering premium livestreams, digital audio and on-demand music experiences from the world's top music festivals and concerts, including Rock in Rio, EDC Las Vegas, Hangout Music Festival, and many more. LiveXLive also gives audiences access to premium original content, artist exclusives and industry interviews. Through its owned and operated Internet radio service, Slacker Radio(www.slacker.com), LiveXLive delivers its users access to millions of songs and hundreds of expert-curated stations. LiveXLive reported a net loss of $38.93 million for the year ended March 31, 2020, compared to a net loss of $37.76 million for the year ended March 31, 2019. As of Sept. 30, 2020, the Company had $81.01 million in total assets, $67.81 million in total liabilities, and $13.20 million in total stockholders' equity. BDO USA, LLP, in Los Angeles, California, the Company's auditor since 2018, issued a "going concern" qualification in its report dated June 26, 2020, citing that the Company has suffered recurring losses from operations, negative cash flows from operating activities and has a net capital deficiency that raise substantial doubt about its ability to continue as a going concern. In addition, the COVID-19 pandemic could have a material adverse impact on the Company's results of operations, cash flows and liquidity. LOANCORE CAPITAL: S&P Withdraws 'B' Long-Term Issuer Credit Rating ------------------------------------------------------------------ S&P Global Ratings withdrew its 'B' long-term issuer credit rating on LoanCore Capital Markets LLC at the company's request. At the time of withdrawal, the outlook was negative. MAH 710 PARK: Seeks Approval to Hire Havkin & Shrago as Counsel --------------------------------------------------------------- MAH 710 Park Avenue 19C Inc. seeks approval from the U.S. Bankruptcy Court for the Central District of California to hire Havkin & Shrago, Attorneys At Law to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) representing the Debtor at its initial interview; (2) representing the Debtor at the meeting of creditors pursuant to Bankruptcy Code Sec. 341(a) or any continuance thereof; (3) representing the Debtor at all hearings before the bankruptcy court; (4) preparing legal papers; (5) advising the Debtor regarding matters of bankruptcy law, including its rights and remedies with respect to its assets and the claims of its creditors; (6) representing the Debtor in contested matters; (7) assisting the Debtor in the preparation of a plan of reorganization and the negotiation and implementation of the plan; (8) analyzing claims that have been filed in the Debtor's bankruptcy case; (9) negotiating with the Debtor's creditors regarding the amount and payment of their claims; (10) objecting to claims as may be appropriate; and (11) all other necessary legal services. Havkin & Shrago received a pre-bankruptcy retainer in the sum of $10,000. The firm's hourly rates are as follows: Stella Havkin $425 per hour David Jacob $325 per hour As disclosed in court filings, Havkin & Shrago is a disinterested person as defined by Section 101(14) of the Bankruptcy Code. The firm can be reached through: Stella Havkin, Esq. Havkin & Shrago, Attorneys At Law 5950 Canoga Avenue, #400 Woodland Hills, CA 91367 Tel: 818-999-1568 Fax: 818-234-1424 Email stella@havkinandshrago.com About MAH 710 Park Avenue 19C New York-based MAH 710 Park Avenue 19C, Inc. is a single asset real estate debtor (as defined in 11 U.S.C. Section 101(51B)). MAH 710 filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 21-14726) on June 8, 2021. Diane Hertz, secretary, signed the petition. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge Vincent P. Zurzolo presides over the case. Havkin & Shrago, Attorneys At Law represents the Debtor as legal counsel. MEA REMAINCO: Court Approves Plan and Disclosures ------------------------------------------------- Judge Mary F. Walrath has entered an order approving on a final basis and confirming the Combined Plan and Disclosure Statement of MEA RemainCo Holdings, LLC, et al. Any and all objections or reservations of rights to the Combined Plan and Disclosure Statement that have not been withdrawn or resolved prior to the Confirmation Hearing are hereby overruled. The amendments and modifications to the Debtors' Combined Disclosure Statement and Joint Chapter 11 Plan of Liquidation since the filing thereof, including as reflected herein, are approved in accordance with section 1127(a) of the Bankruptcy Code and Rule 3019(a) of the Bankruptcy Rules. The Court finds that entry into the Liquidation Trust Agreement is a reasonable exercise of the Debtors' business judgment. The entry by the Debtors into the Liquidation Trust Agreement is approved and shall not be in conflict with any federal or state law. Further, the appointment of Terry S. Park as Liquidation Trustee is approved. The Holders of Claims in Class 3 (Wingfoot/Second Lien Claims) and Class 4 (General Unsecured Claims) have voted to accept the Combined Plan and Disclosure Statement in the numbers and amounts required by Section 1126(c) of the Bankruptcy Code. The Global Settlement incorporated into the Combined Plan and Disclosure Statement represents a sound exercise of the Debtors' business judgment, is a good faith settlement and compromise, is in the best interests of the Debtors, the Estates, the Debtors' Creditors, and other parties in interest, and is fair, equitable, and within the range of reasonableness. About MEA RemainCo Holdings MEA RemainCo Holdings, LLC, f/k/a Energy Alloys Holdings, LLC when founded in 1995 together with its affiliates, are privately-owned distributors and resellers of tube and bar products sold into the oil and gas industry for the exploration of hydrocarbons. Visit https://www.ealloys.com for more information. On May 5, 2021, the Court entered an Order authorizing the Debtors to change the case caption to reflect the corporate name changes pursuant to the BioUrja Purchase Agreement governing the sale of substantially all of the Debtors' assets to BioUrja. The BioUrja Purchase Agreement required, among others, that the Debtors cease using the name "Energy Alloys" and any derivations thereof. On Sept. 9, 2020, then Energy Alloys Holdings LLC and seven of its affiliates filed for bankruptcy protection (Bankr. D. Del. Lead Case No. 20-12088). Bryan Gaston, chief restructuring officer, signed the petitions. Judge Mary Walrath presides over the cases. The Debtors were estimated to have consolidated assets of $10 million to $50 million, and consolidated liabilities of $100 million to $500 million. The Debtors tapped Richards, Layton & Finger, P.A., as bankruptcy counsel, Akin Gump Strauss Hauer & Feld LLP as corporate counsel, Moelis & Company as investment banker, and Epiq Corporate Restructuring LLC as claims and noticing agent. Ankura Consulting Group, LLC provides interim management services. The U.S. Trustee appointed a committee of unsecured creditors on Sept. 23, 2020. The committee is represented by McDermott Will & Emery, LLP. MERIDIAN ADHESIVES: Moody's Assigns B2 CFR, Outlook Stable ---------------------------------------------------------- Moody's Investors Service has assigned a B2 Corporate Family Rating to Meridian Adhesives Group, Inc. and B2 rating to the proposed first lien credit facilities, which comprise a $300 million first-lien term loan and a $25 million revolving credit facility. The outlook is stable. Proceeds from the new term loan will be used to refinance Meridian's existing debt, fund bolt-on acquisitions and for fees and expenses. The ratings are subject to review of the final credit agreements. "Meridian's rating is constrained by its small business scale relative to similarly rated peers, limited track record of operating multiple acquired businesses under one roof and acquisitive growth strategy with potential execution risks. At the same time, Meridian's rating is supported by the high profit margin of its specialty adhesives, sales visibility thanks to its close collaboration with customers, moderate debt leverage at the transaction closing and the potential of free cash flow generation given its formulation driven and low capital intensive business model," said Jiming Zou, Vice President at Moody's. Assignments: Issuer: Meridian Adhesives Group, Inc. Probability of Default Rating, Assigned B2-PD Corporate Family Rating, Assigned B2 Senior Secured Term Loan, Assigned B2 (LGD3) Senior Secured Revolving Credit Facility, Assigned B2 (LGD3) Outlook Actions: Issuer: Meridian Adhesives Group, Inc. Outlook, Assigned Stable RATINGS RATIONALE Meridian has a small business scale and limited operating track record compared to similarly rated companies. The company rolled up 11 companies in the adhesives business from 2018 to early 2021. Its pro-forma sales amounted to about $230 million for the last 12 months ended March 2021. Sales visibility is supported by its close collaboration with customers, proprietary formulations and mission critical nature of the specialty adhesives that account for a small percentage of customers' production costs. Meridian is exposed to general macroeconomic conditions, as it sells epoxy, urethane, acrylics and hybrid adhesives to many markets including electronics, medical, aerospace, flooring, packaging, infrastructure and construction. Its pro-forma EBITDA margin of about 25% reflects the specialty nature of the formulated adhesives for the electronics, medical, and aerospace applications, recent market share gains in its infrastructure adhesives business, and its flexible cost structure. However, its ability to sustain such high profit margin remains to be seen, as there will be mix shift in its businesses, costs and benefits associated with its planned acquisitions. In addition, recent cost inflation in raw materials such as epoxies, acrylics, urethanes will weigh on the earnings from infrastructure and industrial (mainly flooring and packaging) adhesives, which face more competition than electronic adhesives. Moody's expect the business will continue to grow organically. Meridian benefits from the growing demand for adhesives in semiconductor, printed circuit board, microwave, and radio frequency applications. At the same time, economic recovery will support demand from flooring, packaging, infrastructure, concrete repair and commercial construction applications. The rating is constrained by potential debt-funded acquisitions given its private-equity ownership. Business acquisition has gathered pace since early 2021, with four acquisitions completed in the first four months and another two bolt-on acquisitions currently under letter of intent. Its debt leverage at the closing of the debt issuance will be in the mid to low 5 times, which looks moderate compared to peers. However, any sizable acquisition could have a large effect on its financial profile given Meridian's small business scale. Meridian's good liquidity profile is primarily supported by the expected free cash flows and $25 million cash flow revolver, which is expected to be undrawn at the close of the financing. Moody's expect the company to generate positive free cash flow thanks to its good profitability, moderate financial burden and low capital intensity. Capital expenditure accounts for about 1% of sales. The revolver has a springing First Lien Leverage Ratio covenant that would apply only when 35% or more of the revolver is utilized. The first lien term loan and revolver are ranked pari passu, guaranteed by all of the U.S. Borrower's material wholly-owned domestic restricted subsidiaries and secured by substantially all the tangible and intangible assets of the borrower and guarantors. They are rated in line with the B2 Corporate Family Rating given their preponderance in the company's debt capital structure. The stable outlook reflects Moody's expectation that credit metrics will remain appropriate for the rating while the company pursues bolt-on acquisitions. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade the rating, if the company improves its business scale and diversity, debt leverage falls below 4.5 times, retained cash flow exceeds 15% of debt, and management is committed to more conservative financial policies. Moody's could downgrade the rating with expectations for leverage above 6 times, negative free cash flow, or deterioration in liquidity. ESG consideration Meridian's rating has also factored in environmental, social and governance consideration. The company above-average governance risk reflects the potential risks associated with its private equity ownership, including debt-funded acquisitions, shareholder friendly distributions, the lack of oversight by independent directors as well as the limited scope of financial and business disclosure compared to public traded companies. Environmental risk and societal trends have limited effect on the rating given the company's focus on custom formulations and low capital intensity, despite the chemical materials used herein subject to various laws and regulations. The principal methodology used in these ratings was Chemical Industry published in March 2019. Headquartered in Houston, TX, Meridian Adhesives Group, Inc. specializes in adhesive technologies used in the electronics, infrastructure, industrial (mainly flooring and packaging) end-markets. It has operations in North America, Europe, and Asia. Products and solutions are sold to OEMs, distributors and industrial clients. The company reported $231 million pro forma sales for the last 12 months ended March 31, 2021. Funds managed by Arsenal Capital Partners own the majority stake in Meridian. MERMAID BIDCO: New $100MM Loan Add-on No Impact on Moody's B2 CFR ----------------------------------------------------------------- Moody's Investors Service said that Mermaid Bidco Inc.'s ("Datasite") proposed $100 million term loan add-on to finance an acquisition of a North American-based virtual data room solutions provider is credit negative but has no immediate impact on the company's B2 Corporate Family Rating, the B2 credit facility rating or stable outlook. The proposed all debt financed acquisition, one of the largest in the company's history and occurring less than a year since its leveraged-buyout by CapVest Partners LLP and Blackstone Group, Inc., will increase Datasite's already high leverage and indicates the willingness of sponsors to use aggressive financial policy to support growth. Despite the anticipated increase in leverage, the proposed acquisition is strategically sound because it gives Datasite broader access to middle market customers and expands on the company's higher tier client base of corporates and financial institutions. The target company has history of strong customer retention rates and its revenues are largely SaaS-based. Mermaid Bidco Inc. (dba Datasite Global Corporation ("Datasite"), which is owned by CapVest and Blackstone, is a leading SaaS provider of secure on-demand information management and collaboration services to clients to manage their complex, confidential and regulated business information. For the twelve months ending April 30, 2021 the company generated revenue of approximately $317 million. MOTT LLC: Voluntary Chapter 11 Case Summary ------------------------------------------- Debtor: Mott LLC 42 7th Ave SW Suite 100 Cedar Rapids, IA 52404 Business Description: Mott LLC is primarily engaged in renting and leasing real estate properties. Chapter 11 Petition Date: July 7, 2021 Court: United States Bankruptcy Court Northern District of Iowa Case No.: 21-00606 Debtor's Counsel: Austin J. Peiffer, Esq. AG & BUSINESS LEGAL STRATEGIES PO Box 11425 Cedar Rapigs, IA 52410-1425 Tel: 319-363-1641 Email: austin@ablsonline.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Beverly J. Hobart, managing member. The Debtor filed an empty list of its 20 largest unsecured creditors. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/NKZ64VY/Mott_LLC__ianbke-21-00606__0001.0.pdf?mcid=tGE4TAMA NAVITAS MIDSTREAM: $90MM Add-on Loan No Impact on Moody's B3 CFR ---------------------------------------------------------------- Moody's Investors Service said that Navitas Midstream Midland Basin, LLC's B3 Corporate Family Rating and B3-PD Probability of Default Rating will not be affected by the company's proposed issuance of $90 million add-on term loan to its existing first-lien term loan B facility, which is rated B3. Loan proceeds will be used to repay a separate $39 million term loan facility, repurchase up to $50 million of Series D equity units, and cover transaction costs. Concurrent with the add-on offering, Navitas is looking to reprice its existing term loan through an amendment to help lower its overall cost of capital. The $90 million add-on debt is fungible with the existing $685 million term loan due December 13, 2024 and will be treated as a single class of loan. Navitas' term loan is rated B3, the same level as the company's B3 CFR, given its dominant position in the capital structure. While Navitas has a $61 million secured revolver that has a super-priority claim ranking ahead of the term loan, the size of the revolver is small relative to the outstanding term loan amount. Navitas has adequate liquidity and should be able to cover its significant growth capital spending through early-2022 using a combination of cash on hand, operating cash flow, and revolver borrowings as needed. Pro forma for the add-on offering, the company would have roughly $160 million of balance sheet cash and an undrawn $61 million revolving credit facility at June 30, 2021. Navitas' B3 CFR reflects its high but improving financial leverage, significant projected negative free cash flow through early 2022, and direct exposure to upstream drilling and production activity and natural gas volumes in the Midland Basin. The rating also reflects Navitas' private ownership, increasing scale and concentrated asset base. Moody's expects Navitas' free cash flow and leverage metrics to improve materially following the completion of the Leiker Plant in early 2022. The company's primary strengths include its location in one of the most productive and lowest cost hydrocarbon basins in the US, large acreage dedications from a diversified group of E&P companies, long term fee-based contracts, a track record of good organic growth, and strong ongoing support from its private equity sponsor, Warburg Pincus (unrated). The positive outlook reflects Moody's view that Navitas will continue to execute its growth plans in a prudent manner, gain greater scale and diversification and reduce leverage. Navitas Midstream Midland Basin, LLC is a Texas incorporated and privately owned natural gas gathering and processing company with primary operations in the Midland, Martin, Howard, Glasscock, Reagan and Upton Counties. The company is wholly owned by Navitas Midstream Partners, LLC, which is primarily owned by Warburg Pincus. NEW CONCEPTS: Seeks Approval to Hire GrayRobinson as Legal Counsel ------------------------------------------------------------------ New Concepts Distributors Int'l, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Florida to hire GrayRobinson, P.A. to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) giving advice to the Debtor with respect to its powers and duties and the continued management of its business operations; (b) advising the Debtor with respect to its responsibilities in complying with the U.S. trustee's operating guidelines and reporting requirements and with the rules of the court; (c) preparing legal documents; (d) protecting the interest of the Debtor in all matters pending before the court; (e) representing the Debtor in negotiation with its creditors in the preparation of a Chapter 11 plan. For legal services, the firm has agreed to accept $30,000 plus $1,738 filing fee. Patrick Scott, Esq., at GrayRobinson, disclosed in a court filing that his firm is "disinterested" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Patrick S. Scott, Esq. GrayRobinson, P.A. 401 East Las Olas Blvd., Suite 1000 Fort Lauderdale, FL 33301 Phone: (954) 761-8111 Email: patrick.scott@gray-robinson.com About New Concepts Distributors Int'l New Concepts Distributors Int'l, LLC, a Miami, Fla.-based company in the apparel manufacturing industry, filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 21-15831) on June 15, 2021. Janice Santiago, manager, signed the petition. At the time of the filing, the Debtor had between $1 million and $10 million in both assets and liabilities. Judge Robert A. Mark presides over the case. Patrick S. Scott, Esq., at GrayRobinson, P.A., represents the Debtor as legal counsel. NEW HYDE PARK: Case Summary & 16 Unsecured Creditors ---------------------------------------------------- Debtor: New Hyde Park Pharmacy, Inc. DBA Lakeville Pharmacy 749 Hillside Avenue New Hyde Park, NY 11040 Business Description: New Hyde Park Pharmacy, Inc. is in the drug stores business. Chapter 11 Petition Date: July 6, 2021 Court: United States Bankruptcy Court Eastern District of New York Case No.: 21-71245 Judge: Hon. Alan S. Trust Debtor's Counsel: Ronald M. Terenzi, Esq. TERENZI & CONFUSIONE, P.C. 401 Franklin Avenue, Suite 300 Garden City, NY 11530 Tel: 516-812-4502 E-mail: rterenzi@tcpclaw.com Total Assets: $803 Total Liabilities: $5,211,638 The petition was signed by Karthik Dhama as president. A full-text copy of the petition containing, among other items, a list of the Debtor's 16 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/MYD6ZWA/New_Hyde_Park_Pharmacy_Inc__nyebke-21-71245__0001.0.pdf?mcid=tGE4TAMA NEW YORK CLASSIC: Committee Seeks to Hire Arent Fox as Counsel -------------------------------------------------------------- The official committee of unsecured creditors of New York Classic Motors, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to retain Arent Fox LLP as its legal counsel. The firm's services include: (a) advising the committee of its rights, duties and powers in the Debtor's Chapter 11 case; (b) assisting the committee in its consultation with the Debtor relative to the administration of the case; (c) assisting the committee in analyzing the Debtor's assets and liabilities, investigating the extent and validity of liens and participating in and reviewing any proposed asset sales or dispositions; (d) attending meetings and negotiating with representatives of the Debtor, secured creditors and other parties-in-interest; (e) assisting the committee in its examination, investigation and analysis of the conduct of the Debtor's affairs; (f) assisting the committee in the review, analysis, and negotiation of any plan of reorganization or liquidation and disclosure statement that may be filed; (g) assisting the committee in the review, analysis, and negotiation of any financing or funding agreements; (h) taking all necessary actions to protect and preserve the interests of unsecured creditors, including, without limitation, the prosecution of actions on behalf of the committee, negotiations concerning all litigation in which the Debtor is involved, and the review and analysis of all claims filed against the estate; (i) preparing legal papers; (j) appearing before various courts and the Office of the U.S. Trustee; (k) other necessary legal services. The firm's hourly rates are as follows: Partners $705 - $1,180 per hour Of Counsel $695 - $1,105 per hour Associates $430 - $750 per hour Paraprofessionals $185 - $405 per hour George Angelich, Esq., a partner at Arent Fox, disclosed in a court filing that the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: George P. Angelich, Esq. Beth M. Brownstein, Esq. 1301 Avenue of the Americas, Floor 42 New York, NY 10019 Tel: (212) 484-3900 Fax: (212) 484-3990 Email: George.Angelich@ArentFox.com Beth.Brownstein@ArentFox.com About New York Classic Motors New York Classic Motors LLC, a classic car dealer in New York, filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 21-10670) on April 9, 2021. At the time of the filing, the Debtor had between $10 million and $50 million in both assets and liabilities. The Debtor is represented by Kirby Aisner & Curley, LLP. Judge Martin Glenn oversees the case. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on April 29, 2021. Arent Fox, LLP and CBIZ Accounting, Tax and Advisory of New York, LLC serve as the committee's legal counsel and financial advisor, respectively. NEW YORK CLASSIC: Committee Taps CBIZ as Financial Advisor ---------------------------------------------------------- The official committee of unsecured creditors of New York Classic Motors, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to retain CBIZ Accounting, Tax and Advisory of New York, LLC as its financial advisor. The firm's services include: (a) evaluating the Debtor's post-petition cash flow and other projections and budgets prepared by the Debtor; (b) monitoring the Debtor's activities regarding cash expenditures subsequent to the filing of the petition under Chapter 11; (c) reviewing monthly operating reports submitted by the Debtor; (d) managing or assisting in any investigation into the pre-bankruptcy acts, conduct, transfers of property or funds, liabilities and financial condition of the Debtor, the management or creditors; (e) providing financial analysis related to the use of cash collateral, including advising the committee concerning such matters, if applicable; (f) analyzing transactions with vendors, insiders, related or affiliated entities, prior and subsequent to the Debtor's bankruptcy filing; (g) any litigation proceedings against insiders and other potential adversaries; (h) reviewing the financial aspects of any proposed sale or plan of reorganization or liquidation; (i) attending meetings with representatives of the committee and its legal counsel, and preparing presentations to the committee that provide analyses and updates on diligence performed; and (j) other services that may be necessary in CBIZ's role as financial advisor to the committee. As disclosed in court filings, CBIZ is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Charles Berk CBIZ Accounting, Tax & Advisory of New York, LLC 5 Bryant Park at 1065 Avenue of the Americas New York, NY 10018 Tel: 212-790-5883 Email: cberk@cbiz.com About New York Classic Motors New York Classic Motors LLC, a classic car dealer in New York, filed for Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 21-10670) on April 9, 2021. At the time of the filing, the Debtor had between $10 million and $50 million in both assets and liabilities. The Debtor is represented by Kirby Aisner & Curley, LLP. Judge Martin Glenn oversees the case. The U.S. Trustee for Region 2 appointed an official committee of unsecured creditors on April 29, 2021. Arent Fox, LLP and CBIZ Accounting, Tax and Advisory of New York, LLC serve as the committee's legal counsel and financial advisor, respectively. NS8 INC: Former Worker Settles $4 Million Stock Buyback Claim ------------------------------------------------------------- Daniel Gill of Bloomberg Law reports that a former employee of and early investor in defunct cybersecurity company NS8 Inc. agreed to pay $3.3 million to settle a claim to recover $4.1 million he received from a share buyback last 2020. The deal with Sean Clauretie, revealed in a July 2, 2021 court filing, is part of the bankruptcy estate’s efforts to claw back about $71 million from the June 2020 tender offers. The transactions were predicated on a grossly inflated company value, according to Cyber Litigation Inc., an entity serving as NS8's bankruptcy estate after NS8's assets were sold. About NS8 Inc. Las Vegas-based NS8 Inc. is a developer of a comprehensive fraud prevention platform that combines behavioral analytics, real-time scoring, and global monitoring to help businesses minimize risk. Visit https://www.ns8.com for more information. NS8 sought Chapter 11 protection (Bankr. D. Del. Case No. 20-12702) on Oct. 27, 2020. The petition was signed by Daniel P. Wikel, the chief restructuring officer. The Debtor was estimated to have $10 million to $50 million in assets and $100 million to $500 million in liabilities at the time of the filing. The Hon. Christopher S. Sontchi is the case judge. The Debtor tapped Blank Rome LLP and Cooley LLP as its legal counsel, and FTI Consulting Inc. as its financial advisor. Stretto is the claims agent. * * * The company changed its name to Cyber Litigation after it sold substantially all of its assets to Codium Software LLC in December 2020. ONDAS HOLDINGS: Special Meeting of Shareholders Set for Aug. 5 -------------------------------------------------------------- Ondas Holdings Inc. has filed its definitive proxy statement and will hold a special meeting of its shareholders to consider and vote on matters relating to the proposed acquisition of American Robotics, Inc. as disclosed in its definitive proxy statement. The definitive proxy statement is dated July 6, 2021 and, together with the accompanying proxy card, is first being mailed or otherwise delivered to Ondas stockholders as of June 28, 2021, the record date for the Special Meeting, on or about July 7, 2021. A special meeting of Ondas stockholders will be held on Thursday, Aug. 5, 2021 at 10:00 a.m., Eastern time, at The Nantucket Hotel – Breeze Room, 77 Easton Street, Nantucket, Massachusetts, to consider and vote on the proposals related to the Transaction. Only shareholders of Ondas common stock at the close of business on the record date are entitled to notice of and to vote at the Special Meeting. Instructions on how to attend, participate in and vote at the Special Meeting are included in the definitive proxy statement, which is available without charge on the SEC's website at https://www.sec.gov. About Ondas Holdings Inc. Ondas Holdings Inc., through its wholly owned subsidiary, Ondas Networks Inc., is a developer of proprietary, software-based wireless broadband technology for large established and emerging industrial markets. The Company's standards-based, multi-patented, software-defined radio FullMAX platform enables Mission-Critical IoT (MC-IoT) applications by overcoming the bandwidth limitations of today's legacy private licensed wireless networks. Ondas Networks' customer end markets include railroads, utilities, oil and gas, transportation, aviation (including drone operators) and government entities whose demands span a wide range of mission critical applications. These markets require reliable, secure broadband communications over large and diverse geographical areas, many of which are within challenging radio frequency environments. Customers use the Company's FullMAX technology to deploy their own private licensed broadband wireless networks. The Company also offers mission-critical entities the option of a managed network service. Ondas Networks' FullMAX technology supports IEEE 802.16s, the new worldwide standard for private licensed wide area industrial networks. For additional information, visit www.ondas.com. Ondas Holdings reported a net loss of $13.48 million for the year ended Dec. 31, 2020, compared to a net loss of $19.39 million for the year ended Dec. 31, 2019. As of March 31, 2021, the Company had $26.95 million in total assets, $12.24 million in total liabilities, and $14.71 million in total stockholders' equity. POGO ENERGY: Hits Chapter 11 as TexasFreeze Fallout Lingers ----------------------------------------------------------- Jeremy Hill of Bloomberg News reports that Pogo Energy, a pay-as-you-go electricity provider in Texas, filed for Chapter 11 bankruptcy on Thursday after racking up a huge power bill during Winter Storm Uri. The Company listed assets of no more than $10 million and liabilities of as much as $50 million in its bankruptcy petition. Pogo's power invoice for February 2021 exceeded $26 million, more than 30 times greater than its normal amount for that month, according to a court declaration. Pogo owes the money to Luminant Energy Company, the generation arm of Vistra Energy, per court papers. About Pogo Energy Pogo Energy -- https://pogoenergy.com -- is a green energy provider that offers prepaid electricity with no deposit required and same-day electricity service in Texas. Pogo Energy LLC sought Chapter 11 protection (Bankr. N.D. Tex. Case No. 21-31224) on July 1, 2021. In its petition, it listed assets of no more than $10 million and liabilities of as much as $50 million. The case is handled by Honorable Judge Michelle V. Larson. Rachael L. Smiley, of Ferguson Braswell Fraser Kubasta PC, is the Debtors' counsel. PURDUE PHARMA: Greene County to Continue Receiving Money -------------------------------------------------------- Eileen McClory of Dayton Daily News reports that Greene County commissioners approved a resolution Tuesday, June 29, 2021, that allowed the county to remain able to get money from the drug company Purdue Pharma. Purdue Pharma is being sued, accused of contributing to the opioid crisis that left millions of people nationwide dead from the effects of drug addiction. It has filed for Chapter 11 bankruptcy. The resolution in Greene County accepts the Chapter 11 bankruptcy plan and authorizes Greene County administrator Brandon Huddleson to sign the ballot accepting the plan. Cheri Stout, an attorney for the Greene County Prosecutor's Office, said the county and townships involved with the lawsuit all received a recommendation to approve the plan. The money will not be coming soon, said Huddleson. Greene and Montgomery counties are just a few of the Ohio counties involved in the One Ohio agreement, which is an effort led by Gov. Mike DeWine and Attorney General Dave Yost to leverage Ohio’s collective might against the drug industry. Local governments representing more than 80% of the state's population signed onto the plan in early 2020, including 73 of 88 counties. The state of Ohio has two lawsuits, which are pending in Ross and Madison counties. More than 150 Ohio local governments have cases consolidated in U.S. District Court before Judge Daniel Polster in Cleveland. Under the One Ohio agreement, which spells out how money would be divvied up, 11% would be taken off the top for attorney fees and the remaining cash would be divvied up. That results in 30% for local governments, 55% to a new foundation and 15% to the attorney general’s office. The foundation would be controlled by a 25-member board appointed by state, legislative and local officials. It would spend settlement money to address the opioid epidemic both locally and statewide. The 118 local jurisdictions signing onto the agreement include the cities of Dayton, Springfield, Middletown and Hamilton and the counties of Butler, Champaign, Clark, Greene, Miami, Montgomery and Warren. More than 2,600 lawsuits were filed across the U.S. against opioid makers and distributors. About Purdue Pharma LP Purdue Pharma L.P. and its subsidiaries -- http://www.purduepharma.com/-- develop and provide prescription medicines and consumer products that meet the evolving needs of healthcare professionals, patients, consumers and caregivers. Purdue's subsidiaries include Adlon Therapeutics L.P., focused on treatment for Attention-Deficit/Hyperactivity Disorder (ADHD) and related disorders; Avrio Health L.P., a consumer health products company that champions an improved quality of life for people in the United States through the reimagining of innovative product solutions; Imbrium Therapeutics L.P., established to further advance the emerging portfolio and develop the pipeline in the areas of CNS, non-opioid pain medicines, and select oncology through internal research, strategic collaborations and partnerships; and Greenfield Bioventures L.P., an investment vehicle focused on value-inflection in early stages of clinical development. Opioid makers in the U.S. are facing pressure from a crackdown on the addictive drug in the wake of the opioid crisis and as state attorneys general file lawsuits against manufacturers. More than 2,000 states, counties, municipalities and Native American governments have sued Purdue Pharma and other pharmaceutical companies for their role in the opioid crisis in the U.S., which has contributed to the more than 700,000 drug overdose deaths in the U.S. since 1999. OxyContin, Purdue Pharma's most prominent pain medication, has been the target of over 2,600 civil actions pending in various state and federal courts and other fora across the United States and its territories. On Sept. 15 and 16, 2019, Purdue Pharma L.P. and 23 affiliated debtors each filed a voluntary petition for relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 19-23649), after reaching terms of a preliminary agreement for settling the massive opioid litigation facing the Company. The Company's consolidated balance sheet at Aug. 31, 2019, showed $1.972 billion in assets and $562 million in liabilities. U.S. Bankruptcy Judge Robert Drain, in White Plains, New York, has been assigned to oversee Purdue's Chapter 11 case. Davis Polk & Wardwell LLP and Dechert LLP are serving as legal counsel to Purdue. PJT Partners is serving as investment banker, and AlixPartners is serving as financial advisor. Prime Clerk LLC is the claims agent. ROCHESTER DIOCESE: Proposed Insurers' Settlement Questioned ----------------------------------------------------------- Will Astor of Rochester Beacon reports that Rochester diocese's proposed settlement with insurers questioned. As the two-year mark in the Roman Catholic Diocese of Rochester's bankruptcy draws nigh, a $35 million settlement proposed between the diocese and a handful of its insurers is not sitting well with the bankruptcy's official creditors committee. How the court comes down on the proposed Rochester diocese settlement could set the tone, not just for the Rochester case, but also for Chapter 11 bankruptcies of three other New York Catholic dioceses that asked for court protection months after the Rochester diocese’s September 2019 filing. "I believe that the settlement of $35 million is within the range of reasonableness and should be approved by the Court," wrote diocese special insurance counsel James Murray in a June 24, 2021 brief supporting the proposal. Murray is a Washington, D.C.-based partner with Blank Rome LLP. He heads the firm's policyholder-only insurance recovery group. About The Diocese of Rochester The Diocese of Rochester in upstate New York provides support to 86 Roman catholic parishes across 12 counties in upstate New York. It also operates a middle school, Siena Catholic Academy ("SCA"). The Diocese has 86 full-time employees and six part-time employees and provides medical and dental benefits to an additional 68 retired priests and 2 former priests. The Diocese generated $21.88 million of gross revenue for the fiscal year ending June 30, 2019, compared with a gross revenue of $24.25 million in fiscal year 2018. The Diocese of Rochester filed for Chapter 11 bankruptcy protection (Bankr. W.D.N.Y. Case No. 19-20905) on Sept. 12, 2019, amid a wave of lawsuits over alleged sexual abuse of children. In the petition, the Diocese was estimated to have $50 million to $100 million in assets and at least $100 million in liabilities. Bond, Schoenec & King, PLLC is the Diocese's counsel. Stretto is the claims and noticing agent. SCHULDNER LLC: Case Summary & 3 Unsecured Creditors --------------------------------------------------- Debtor: Schuldner, LLC 523 E 11th St Duluth, MN 55805-1319 Business Description: Schuldner, LLC is engaged in activities related to real estate. Chapter 11 Petition Date: July 6, 2021 Court: United States Bankruptcy Court District of Minnesota Case No.: 21-50323 Judge: Hon. William J. Fisher Debtor's Counsel: Joseph Dicker, Esq. JOSEPH W. DICKER, P.A. 1406 W Lake St Ste 209 Minneapolis, MN 55408-2653 Email: joe@joedickerlaw.com Total Assets: $1,150,200 Total Liabilities: $2,530,877 The petition was signed by Carl Green, chief manager. A full-text copy of the petition containing, among other items, a list of the Debtor's three largest unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/B3XC7XI/Schuldner_LLC__mnbke-21-50323__0001.0.pdf?mcid=tGE4TAMA SEASPAN CORP: S&P Assigns 'BB-' Long-Term ICR, Outlook Stable ------------------------------------------------------------- On July 6, 2021, S&P Global Ratings assigned its 'BB-' long-term issuer credit rating to Seaspan Corp., the largest independent owner and operator of containerships in the world. S&P said, "We also assigned our 'BB-' issue-level rating and '4' recovery rating to the company's proposed US$500 million senior unsecured notes due 2029. "Our rating on Seaspan incorporates the company's position as the world's leading containership charterer, which is a competitive advantage and contributes to operating stability. Seaspan is a leading independent owner and charterer of containerships globally. It leases its vessels primarily under long-term, fixed-rate, time charters to the largest container shipping liners. The fleet consists of 127 containerships (as of March 31, 2021) with a total capacity of about 1.1 million 20-foot-equivalent units (TEU). On a pro forma basis, mainly to include planned new builds entering service through 2024, the company expects to operate 176 vessels with approximately 1.8 million TEU of capacity. The average age of the pro forma fleet is just over five years, which is newer than the global average, with an average remaining contracted charter period (leases) of about seven years on a TEU-weighted basis. The relatively large share of contracted volumes (at fixed prices) and consistently high capacity utilization (often 98% annually) provide strong earnings visibility. "Seaspan's fleet represent about 13% of globally leased containership capacity, well above that of the next six largest competitors (none with more than a 7% share of the market). The majority (about 80%) of the fleet is composed of vessels with capacity of at least 10,000 TEU, which we believe are increasingly demanded by global liners. In our view, the chartering of larger vessels increases barriers to entry, affords greater economies of scale, and should improve the company's ability to re-charter as contracts expire relative to smaller capacity vessels. Seaspan also benefits from its long-term relationships with the world's largest freight shipping liners. We understand large liners typically prefer to lease vessels from operators with diverse funding sources, a proven operating track record, and relatively modern vessels (especially because they have lower fuel costs). "High rate of contracted revenues contributes to stable cash flows and profitability. Seaspan has contracts in place for all its capacity for the rest of 2021, over 88% in 2022, and about 80% in 2023, all of which are noncancellable (take or pay) and U.S. dollar denominated. Its fixed-rate contract profile (with a pro forma duration of close to seven years) and historically high vessel utilization (typically at or above 98%) provide revenue and earnings visibility. In our view, the company's laddered contracts and our improving view of global shipping market fundamentals mitigate re-chartering risk as contracts expire. We assume Seaspan will realize relatively stable average realized charter rates over the next few years, with comparatively limited exposure to freight rate volatility faced by its liners customers. Liners are also required to absorb any bunker fuel price or capacity utilization risk when chartering Seaspan's vessels, and this has contributed to historically high EBITDA margins of over 70%. Our view of the company's profitability, however, is tempered by modest returns on capital that mainly reflect significant investment requirements for new vessel construction. "The business outlook remains positive over the next couple of years, but our rating incorporates the company's exposure to cyclicality and overcapacity. We view the shipping sector as having higher-than-average industry risk, constraining our overall assessment of Seaspan's business risk profile. The industry is highly capital intensive and fragmented (notwithstanding recent consolidation) with a history of supply-demand imbalances and high price competition. It is also vulnerable to low-probability, high-impact events, which typically depress utilization and charter rates. Therefore, liners are susceptible to sharp industry downturns that have led to past financial restructurings. Seaspan is comparatively less sensitive to cyclical fluctuations. However, its customer base remains highly concentrated, with its top four customers accounting for two-thirds of its pro forma TEU capacity: ONE Ocean Network Express (23%), MSC (18%), COSCO Shipping Group (15%), and Yang Ming (12%). Any material operating and/or financial challenges facing these or other liner customers could have a material impact on Seaspan's financial results. In addition, the containership chartering industry remains highly fragmented; high competition, particularly during periods of excess vessel capacity, can translate into volatile spot charter rates, vessel valuations, and potential deterioration in the credit quality of Seaspan's customers. The most recent example was the unscheduled off-hire in late-2016/early 2017 of four vessels formerly under long-term charters with Hanjin Shipping (before its bankruptcy in August 2016). However, Seaspan re-chartered three of those vessels (to Hapag-Lloyd) and utilization returned to historical average levels (at or above 98% since second-quarter 2017) that we expect will continue. "The outlook for Seaspan's liner customers has improved, and we believe the company's contract book limits exposure to cyclical fluctuations over the next couple of years. Shipping volumes have materially recovered since the outset of the pandemic, notably supported by the movement of essential goods and increase in e-commerce. We estimate a rebound in shipped volumes consistent with global economic growth in 2021 and expect volumes to remain robust beyond this year. Congestion in main maritime ports and supply-chain disruptions have increased containership utilization and charter rates. We also believe that demand-and-supply conditions will be largely in balance in 2021 and 2022, with growth in container volumes at least matching the growth in containership capacity. We assume modestly lower charter rates beyond this year as container demand eases, but Seaspan's high contracted revenues limit material downside risk to earnings." Seaspan's new build vessel expansion is aggressive and will contribute to persistently high debt levels. Seaspan's debt load is significant at about US$5.1 billion at March 31, 2021, leading to adjusted FFO to debt just above 12%. Debt primarily consists of draws on the company's secured credit facilities (revolving and term loan facilities) and a material amount of leases and unsecured notes, of which the vast majority is used to fund vessel acquisitions. S&P expects debt levels will rise in the next few years related to new build vessel program payments, but it believes the company will maintain adjusted FFO to debt above 12%, and should improve significantly beyond 2023, underpinned by earnings growth from new vessels entering service. S&P said, "However, we view the company's debt-financed expansion strategy as aggressive. Seaspan's primary objective is to continue to expand its containership leasing business through vessel acquisitions. Its fleet of new vessels scheduled for delivery between late 2021 and 2024 now exceeds 40--a significant amount relative to its current fleet (about 127 vessels at year-end 2020). These investments include long-term chartering contracts upon entry into service but require material new sources of funding that we assume is debt. "We estimate Seaspan will add about US$2.7 billion in incremental cumulative debt through 2024. Therefore, we believe the company is dependent on earnings and cash flow expansion, particularly beyond 2023, to improve its leverage metrics and maintain sufficient liquidity. In addition, although its long-term charter contracts provide stability, future re-chartering rates present a degree of uncertainty to prospective cash flow. Moreover, Seaspan will need to address annual debt repayment requirements (including scheduled amortization) over the next several years. That said, the company has demonstrated good access to capital, as evidenced by numerous credit facilities secured by underlying vessels and public debt issuances. The value of its unencumbered fleet is estimated at over US$1 billion and is a potential source of collateral, if required. "The stable outlook reflects our expectation that Seaspan will generate very stable cash flows due in large part to a significant portion of its revenue being generated from long-term, fixed-price contracts. The outlook also reflects our view that the company's debt load will increase over the next few years to fund vessel growth, but we expect FFO-to-debt will be sustained above 12% over the next two years. "We could lower the rating on Seaspan within the next 12 months if we expect adjusted FFO-to-debt at below 12% on a sustained basis. This could occur if the company's debt balance increases significantly to finance additional vessels or distributions to shareholders. A downgrade could also occur if market conditions in the shipping sector deteriorate, resulting in a decline in average daily charter rates or reduced customer credit quality that leads to unfavorable changes to charter contracts or payment issues. "We could raise the rating within the next 12 months if we expect the company to sustain adjusted FFO-to-debt above 20%. This could occur if average daily charter rates exceed our assumptions, underpinned by a sustained improvement in market conditions, while the company remains prudent with use of debt and dividend distributions." SEMILEDS CORP: Inks $20M Sales Agreement With Roth Capital ---------------------------------------------------------- SemiLEDs Corporation has entered into a sales agreement with Roth Capital Partners, LLC under which the Company may offer and sell from time to time through the Agent its common stock, par value $0.0000056 per share, having an aggregate offering price of up to $20,000,000. The Placement Shares will be offered and sold pursuant to the Company's shelf registration statement on Form S-3 (Registration No. 333-256613). The Company is not obligated to sell any Placement Shares pursuant to the Agreement. Subject to the terms and conditions of the Agreement, the Agent will use commercially reasonable efforts, consistent with its normal trading and sales practices and applicable state and federal law, rules and regulations and the rules of the Nasdaq Stock Market LLC, to sell the Placement Shares from time to time based upon the Company's instructions, including any price, time or size limits or other customary parameters or conditions the Company may impose. Sales of the Placement Shares, if any, will be made on Nasdaq at market prices by any method permitted by law deemed to be an "at the market offering" as defined in Rule 415 of the Securities Act of 1933, as amended. The Company will pay a commission to the Agent of 3.0% of the gross proceeds of the sale of the Placement Shares sold under the Agreement and reimburse the Agent for certain expenses. About SemiLEDs Headquartered in Miao-Li County, Taiwan, R.O.C., SemiLEDs -- http://www.semileds.com-- develops and manufactures LED chips and LED components for general lighting applications, including street lights and commercial, industrial, system and residential lighting, along with specialty industrial applications such as ultraviolet (UV) curing, medical/cosmetic, counterfeit detection, horticulture, architectural lighting and entertainment lighting. SemiLEDs reported a net loss of $547,000 for the year ended Aug. 31, 2020, compared to a net loss of $3.56 million for the year ended Aug. 31, 2019. As of Feb, 28, 2021, the Company had $15.13 million in total assets, $13.51 million in total liabilities, and $1.62 million in total equity. KCCW Accountancy Corp., in Diamond Bar, California, the Company's auditor since 2019, issued a "going concern" qualification in its report dated Nov. 17, 2020, citing that the Company incurred recurring losses from operations and has an accumulated deficit, which raises substantial doubt about its ability to continue as a going concern. SHUTTERFLY LLC: S&P Rates New $1.105BB Sr. Secured Term Loan 'B-' ----------------------------------------------------------------- S&P Global Ratings assigned its 'B-' rating and '3' recovery rating to Shutterfly LLC's proposed $1.105 billion senior secured term loan facility. The '3' recovery rating indicates our expectation for meaningful recovery (50%-70%; rounded estimate: 60%) of principle in the event of a payment default. The company will use the proceeds to refinance its outstanding $870 million term loans B due in 2026 and fund the acquisition of Spoonflower. Shutterfly expects this acquisition to expand the products in its home decor segment while adding cross-selling opportunities and synergies. S&P said, "We believe that acquisition will temporarily slow the pace of the company's leverage reduction. Pro forma for the new debt and earnings contributions from Spoonflower, Shutterfly's leverage was about 12.3x as of March 31, 2021. We expect leverage will decline to 7.3x in 2021 and 6.5x in 2022, primarily because of revenue growth in the Lifetouch segment after pandemic-related declines and ongoing 3%-7% growth in the consumer segment. In addition, we expect Shutterfly will generate positive cash flow over the next 12 months with free operating cash flow (FOCF) to debt of 4%-5%. "We could lower the issuer credit rating if we believe that Shutterfly's FOCF would remain negligible over the next 12 months due to competitive pressure or lower than expected pace of recovery in the company's Lifetouch segment. An upgrade would require debt leverage consistently below 6.5x through revenue and EBITDA growth as well as synergies from the Spoonflower acquisition." Key analytical factors -- The default risk factors reflected in our simulated default scenario include an economic downturn following the pandemic, customer losses, and pricing pressures as new entrants emerge or existing competitors expand their product offerings and features. -- Shutterfly's capital structure consists of a pari passu $300 million senior secured revolving credit facility due 2024, the proposed 1.105 billion senior secured term loan due 2026, and $750 million of senior secured notes due 2026. The company also has $300 million of unsecured notes due 2027 (not rated). -- Shutterfly LLC is the borrower of the senior secured credit facility and the secured notes, collectively referred to as secured debt. -- The secured debt is guaranteed by all material U.S. subsidiaries of the borrowers and guarantors, including Snapfish LLC. The secured debt benefits from a first-lien on substantially all of the assets of the borrower and guarantors. The collateral also includes a pledge of up to 65% of the capital stock of first-tier foreign subsidiaries that are not subsidiary guarantors. -- Shutterfly LLC is the issuer of the unsecured debt (unrated), which is guaranteed by the same subsidiaries that guarantee the secured debt. S&P expects that Shutterfly would be reorganized in the event of a payment default given the company's brand recognition, vertical manufacturing, established technologies, and high historical customer-retention rates. Simulated default assumptions -- Year of default: 2023 -- Legal jurisdiction: U.S. -- EBITDA at default: About $241 million -- Distressed EBITDA multiple: 6x -- The $300 million revolving credit facility is 85% of drawn at default. Simplified waterfall -- Gross enterprise value (E.V.): about $1.45 billion -- Net E.V. (after 5% bankruptcy administrative costs): about $1.38 billion -- First-lien secured debt claim: about $2.18 billion -- Recovery expectation: 50%-70% (rounded estimate: 60%) -- Value available to unsecured debt: Negligible -- Unsecured debt claims: $316 million. SPICE MUST FLOW: Case Summary & 5 Unsecured Creditors ----------------------------------------------------- Debtor: The Spice Must Flow, LLC 455 N. Louisiana Avenue Ste C1 Asheville, NC 28806 Chapter 11 Petition Date: July 6, 2021 Court: United States Bankruptcy Court Western District of North Carolina Case No.: 21-10135 Judge: Hon. George R. Hodges Debtor's Counsel: Samantha K. Brumbaugh, Esq. IVEY, MCCLELLAN, SIEGMUND, BRUMBAUGH & MCDONOUGH, LLP 100 S. Elm St, Ste. 500 Greensboro, NC 27401 Tel: 336-274-4658 Fax: 336-274-4540 Estimated Assets: $1 million to $10 million Estimated Liabilities: $500,000 to $1 million The petition was signed by Shawn Thomas Johnson, member/manager. A full-text copy of the petition containing, among other items, a list of the Debtor's five unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/B36KW7Y/The_Spice_Must_Flow_LLC__ncwbke-21-10135__0001.0.pdf?mcid=tGE4TAMA STONEWAY CAPITAL: Seeks to Hire Bennett Jones as Canadian Counsel ----------------------------------------------------------------- Stoneway Capital Corporation and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Bennett Jones, LLP as their Canadian counsel. The firm's services include: (a) advising the Debtors with respect to their rights, duties and powers in relation to matters of Canadian law in their Chapter 11 cases; (b) assisting and advising the Debtors in relation to matters of Canadian law relative to the administration of the Debtors' bankruptcy cases; (c) advising the Debtors regarding the Canadian proceedings; (d) advising the Debtors with respect to any Canadian legislative, regulatory or governmental activities and issues as instructed by the Debtors; (e) assisting the Debtors in preparing pleadings and other legal papers; (f) assisting the Debtors in the review and analysis of their various commercial agreements in relation to matters of Canadian law; and (g) other legal services related to matters of Canadian law. The firm's hourly rates are as follows: 2021 Rates (CAD$) Partners $640 - $1505 per hour Associates $330 - $760 per hour Paraprofessionals $135 - $475 per hour Kevin J. Zych, Partner CAD$1335 per hour Richard B. Swan, Partner CAD$1105 per hour Mike Shakra, Partner CAD$745 per hour Joshua Foster, Associate CAD$430 per hour Bennett Jones will also be reimbursed for out-of-pocket expenses incurred. In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, Bennett Jones disclosed the following: -- Bennett Jones did not agree to any variations from, or alternatives to, its standard or customary billing arrangements for this engagement; -- none of the professionals included in this engagement have varied, or will vary their rate based on the geographic location of the bankruptcy case; -- When Bennett Jones was retained on Sept. 1, 2020, the firm's rates were: Partners CAD$610 - CAD$1,435 Associates CAD$315 - CAD$725 Paraprofessionals CAD$240 - CAD$270 Bennett Jones' current hourly rates are: Partners CAD$640 - CAD$1505 Associates CAD$330 - CAD$760 Students CAD$250 - CAD$285 The rates have slightly increased as Bennett Jones' hourly billing rates are subject to periodic adjustments to reflect economic and other conditions. Kevin Zych, Esq., a partner at Bennett Jones, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Kevin Zych, Esq. Bennett Jones LLP 3400 One First Canadian Place P.O. Box 130 Toronto, Ontario M5X 1A4 Canada Tel: 416-863-1200 / 416-777-5738 Fax: 416-863-1716 Email: zychk@bennettjones.com About Stoneway Capital Corp. Stoneway Capital Corporation is a limited corporation incorporated in New Brunswick, Canada, formed for the purpose of owning and operating, through its Argentine subsidiaries, power generation projects that will provide electricity to the wholesale electricity markets in Argentina. The Argentine subsidiaries operate four power-generating plants in Argentina that provide electricity to the wholesale electricity market in Argentina. Stoneway is 100% owned by GRM Energy Investment Limited. On Oct. 8, 2020, the Company commenced proceedings under the Canada Business Corporations Act (the "CBCA"). The Debtors were well on the way toward closing the consensual restructuring when on Dec. 4, 2020, the Argentine Supreme Court issued a decision in an ongoing noise discharge dispute involving one of the Generation Facilities located in Pilar, Argentina. The Argentine Supreme Court Decision created significant uncertainty as it overturned a decision of the federal appeals court in San Martin, Buenos Aires. As a result of the looming expiration of the informal standstill arrangement, the Debtors commenced chapter 11 cases in the U.S. in order to put the automatic stay in place, maintain the status quo pending resolution of the various issues in Argentina, and ensure that neither the Indenture Trustee nor the Argentine Trustee takes any action that could be detrimental or value destructive to the Company. Stoneway Capital Ltd. and five related entities, including Stoneway Capital Corp., sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 21-10646) on April 7, 2021. Stoneway estimated liabilities of $1 billion to $10 billion and assets of $500 million to $1 billion. Judge James L. Garrity, Jr. oversees the cases. The Debtors tapped Shearman & Sterling LLP as bankruptcy counsel, Bennett Jones LLP as Canadian counsel, and Lazard Freres & Co., LLC as investment banker. Prime Clerk, LLC is the claims agent and administrative advisor. STONEWAY CAPITAL: Seeks to Hire Shearman & Sterling as Counsel -------------------------------------------------------------- Stoneway Capital Corporation and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Shearman & Sterling, LLP to serve as legal counsel in their Chapter 11 cases. The firm will render these services: (a) advise the Debtors with respect to their rights and duties; (b) advise and consult on the conduct of the cases, including, but not limited to, all of the legal and administrative requirements of operating in Chapter 11; (c) prepare legal papers; (d) provide necessary actions to protect and preserve the Debtors' estate, including, but not limited to, the prosecution of actions on the Debtors' behalf, the defense of any action commenced against the Debtors, and the representation of the Debtors in negotiations concerning litigation in which the Debtors are involved, including objections to claims filed against the estate; (e) give legal advice on the use of cash collateral and how to obtain debtor-in-possession financing and exit financing, and the terms and conditions of such financing; (f) give legal advice in connection with any potential sale of the Debtors' assets; (g) advise the Debtors regarding the negotiation and pursuit of confirmation of a Chapter 11 plan and approval of the corresponding solicitation procedures and disclosure statement; (h) attend meetings and negotiate with representatives of creditors, equity holders, prospective investors or acquirers, and other parties-in-interest; (i) appear before the bankruptcy court, any appellate courts and the U.S. trustee; (j) provide general corporate, capital markets, mergers and acquisitions, employment, tax, and litigation advice and other general non-bankruptcy legal services to the Debtors, as required; and (k) perform all other legal services for the Debtors, including: (i) analyzing the Debtors' leases and contracts and the assumption and assignment or rejection thereof; (ii) analyzing the validity of liens against the Debtors; and (iii) advising the Debtors on corporate and litigation matters. The firm's hourly rates are as follows: Partners $1,095 to $1,745 per hour Counsel $1,170 to $1,355 per hour Associates $565 to $1,155 per hour Legal Assistants $305 to $435 per hour In accordance with Appendix B-Guidelines for reviewing fee applications filed by attorneys in larger Chapter 11 cases, Shearman & Sterling disclosed the following: -- Shearman & Sterling has not agreed to a variation of its standard or customary billing arrangements for this engagement; -- None of the firm's professionals included in this engagement have varied their rate based on the geographic location of this chapter 11 case; -- Shearman & Sterling was retained by the Debtors pursuant to an engagement agreement dated March 13, 2020. The billing rates and material terms of the pre-bankruptcy engagement are consistent with the rates and terms proposed by the firm. The firm's billing rates have not changed post-petition; and -- The Debtor will be approving a prospective budget and staffing plan for Shearman & Sterling's engagement for the post-petition period as appropriate. In accordance with the U.S. Trustee Guidelines, the budget may be amended as necessary to reflect changed or unanticipated developments. Fredric Sosnick, Esq., a partner at Shearman & Sterling, disclosed in a court filing that his firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Fredric Sosnick, Esq. Shearman & Sterling, LLP 599 Lexington Avenue New York, NY 10022 Tel: (212) 848-4000 Fax: (646) 848-8174 Email: fsosnick@shearman.com About Stoneway Capital Corp. Stoneway Capital Corporation is a limited corporation incorporated in New Brunswick, Canada, formed for the purpose of owning and operating, through its Argentine subsidiaries, power generation projects that will provide electricity to the wholesale electricity markets in Argentina. The Argentine subsidiaries operate four power-generating plants in Argentina that provide electricity to the wholesale electricity market in Argentina. Stoneway is 100% owned by GRM Energy Investment Limited. On Oct. 8, 2020, the Company commenced proceedings under the Canada Business Corporations Act (the "CBCA"). The Debtors were well on the way toward closing the consensual restructuring when on Dec. 4, 2020, the Argentine Supreme Court issued a decision in an ongoing noise discharge dispute involving one of the Generation Facilities located in Pilar, Argentina. The Argentine Supreme Court Decision created significant uncertainty as it overturned a decision of the federal appeals court in San Martin, Buenos Aires. As a result of the looming expiration of the informal standstill arrangement, the Debtors commenced chapter 11 cases in the U.S. in order to put the automatic stay in place, maintain the status quo pending resolution of the various issues in Argentina, and ensure that neither the Indenture Trustee nor the Argentine Trustee takes any action that could be detrimental or value destructive to the Company. Stoneway Capital Ltd. and five related entities, including Stoneway Capital Corp., sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 21-10646) on April 7, 2021. Stoneway estimated liabilities of $1 billion to $10 billion and assets of $500 million to $1 billion. Judge James L. Garrity, Jr. oversees the cases. The Debtors tapped Shearman & Sterling LLP as bankruptcy counsel, Bennett Jones LLP as Canadian counsel, and Lazard Freres & Co., LLC as investment banker. Prime Clerk, LLC is the claims agent and administrative advisor. STONEWAY CAPITAL: Taps Prime Clerk as Administrative Advisor ------------------------------------------------------------ Stoneway Capital Corporation and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Prime Clerk, LLC as their administrative advisor. The firm's services include: a. assisting in the solicitation, balloting and tabulation of votes, preparing any related reports in support of confirmation of a Chapter 11 plan, and processing requests for documents; b. preparing an official ballot certification and, if necessary, testifying in support of the ballot tabulation results; c. assisting in the preparation of the Debtors' schedules of assets and liabilities and statements of financial affairs and gathering data in conjunction therewith; d. providing a confidential data room, if requested; e. managing and coordinating any distributions pursuant to a Chapter 11 plan; and f. other bankruptcy administrative services. The firm's hourly rates are as follows: Director of Solicitation $210 per hour Solicitation Consultant $190 per hour COO and Executive VP No charge Director $175-$195 per hour Consultant/Senior Consultant $65-$165 per hour Technology Consultant $35-$95 per hour Analyst $30-$50 per hour Prime Clerk will also be reimbursed for out-of-pocket expenses incurred. Benjamin Steele, vice president of Prime Clerk, disclosed in a court filing that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Prime Clerk can be reached at: Benjamin J. Steele Prime Clerk LLC 830 3rd Avenue, 9th Floor New York, NY10022 Tel: (212) 257-5450 Email: bsteele@primeclerk.com About Stoneway Capital Corp. Stoneway Capital Corporation is a limited corporation incorporated in New Brunswick, Canada, formed for the purpose of owning and operating, through its Argentine subsidiaries, power generation projects that will provide electricity to the wholesale electricity markets in Argentina. The Argentine subsidiaries operate four power-generating plants in Argentina that provide electricity to the wholesale electricity market in Argentina. Stoneway is 100% owned by GRM Energy Investment Limited. On Oct. 8, 2020, the Company commenced proceedings under the Canada Business Corporations Act (the "CBCA"). The Debtors were well on the way toward closing the consensual restructuring when on Dec. 4, 2020, the Argentine Supreme Court issued a decision in an ongoing noise discharge dispute involving one of the Generation Facilities located in Pilar, Argentina. The Argentine Supreme Court Decision created significant uncertainty as it overturned a decision of the federal appeals court in San Martin, Buenos Aires. As a result of the looming expiration of the informal standstill arrangement, the Debtors commenced chapter 11 cases in the U.S. in order to put the automatic stay in place, maintain the status quo pending resolution of the various issues in Argentina, and ensure that neither the Indenture Trustee nor the Argentine Trustee takes any action that could be detrimental or value destructive to the Company. Stoneway Capital Ltd. and five related entities, including Stoneway Capital Corp., sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Case No. 21-10646) on April 7, 2021. Stoneway estimated liabilities of $1 billion to $10 billion and assets of $500 million to $1 billion. Judge James L. Garrity, Jr. oversees the cases. The Debtors tapped Shearman & Sterling LLP as bankruptcy counsel, Bennett Jones LLP as Canadian counsel, and Lazard Freres & Co., LLC as investment banker. Prime Clerk, LLC is the claims agent and administrative advisor. SUITABLE TECHNOLOGIES: Wife, Founder Drops Case Due to Bankruptcy ----------------------------------------------------------------- Mike Leonard of Bloomberg Law reports that Suitable Technologies Inc.'s founder and his estranged wife have agreed to end their business dispute after a bankruptcy judge approved a Chapter 11 liquidation plan for the Beam telepresence robot manufacturer, according to a Delaware Chancery Court filing. The lawsuit was filed in 2019 by Allison Huynh, who sought to stop Scott Hassan from selling the robotics pioneer to a Danish consortium led by Blue Ocean Robotics Holdings APS for what she claimed was less than 1% of its $60 million value. Huynh and Hassan -- a Google and Yahoo alumnus who helped develop the first online search engines -- have been separated. About Suitable Technologies Headquartered in Palo Alto, California, Suitable Technologies, Inc. -- https://www.suitabletech.com/ -- develops, manufactures, and sells telepresence system and technology platforms in both domestic and international markets. It also maintains an intellectual property portfolio, which includes a number of different patents associated with, among other things, wireless connectivity, as well as trademarks in the United States and other foreign jurisdictions. Its primary product is called "Beam", a telepresence device designed to promote remote collaboration, provide individuals with the ability to communicate remotely with others on both a visual and audio basis, and move freely through a workplace using the Company's manufactured devices and companion software. Suitable Technologies, Inc., sought Chapter 11 protection (Bankr. D. Del. Case No. 20-10432) on Feb. 26, 2020. The Debtor was estimated to have $10 million to $50 million in assets and $50 million to $100 million in liabilities. The Honorable Mary F. Walrath is the case judge. The Debtor tapped Young Conaway Stargatt & Taylor, LLP as counsel; and Stout Risius Ross Advisors, LLC, as an investment banker. Asgaard Capital LLC is the staffing provider and its founder, Charles C. Reardon, is presently serving as CRO for the Debtor. Donlin, Recano & Company, Inc., is the claims agent. TECT AEROSPACE: Boeing Is the Winner of Kansas Bankruptcy Auction ----------------------------------------------------------------- Leslie A. Pappas of Bloomberg Law reports that Boeing Co. agreed to acquire the Kansas assets of its bankrupt supplier, TECT Aerospace Group Holdings Inc., after winning an auction with a bid worth nearly $20 million. Kansas Aerospace Manufacturing LLC, a wholly owned Boeing subsidiary, offered to pay $500,000 in cash, plus $13.5 million in secured debt forgiveness and creation of a $5.84 million fund to cover assumed liabilities. The purchase agreement, filed July 2, 2021 with the U.S. Bankruptcy Court for the District of Delaware, covers assets related to TECT’s Kansas manufacturing business. The bankrupt airplane parts manufacturer decided to hold the auction without an opening bid. About TECT Aerospace Holdings Inc. TECT Aerospace Group Holdings, Inc., and its affiliates manufacture high precision components and assemblies for the aerospace industry, specializing in complex structural and mechanical assemblies, and, machined components for a variety of aerospace applications. TECT produces assemblies and parts used in flight controls, fuselage/interior structures, doors, wings, landing gear, and cockpits. TECT operates manufacturing facilities in Everett, Washington, and Park City and Wellington, Kansas and their corporate headquarters is located in Wichita, Kansas. TECT currently employs approximately 400 individuals nationwide. TECT and its affiliates are privately held companies owned by Glass Holdings, LLC and related Glass-owned or Glass controlled entities. TECT Aerospace Group Holdings, Inc., and six affiliates sought Chapter 11 protection (Bankr. D. Del. Case No. 21-10670) on April 6, 2021. TECT Aerospace estimated assets of $50 million to $100 million and liabilities of $100 million to $500 million as of the bankruptcy filing. The Debtors tapped RICHARDS, LAYTON & FINGER, P.A., as counsel; WINTER HARBOR, LLC, as restructuring advisor; and IMPERIAL CAPITAL, LLC, as investment banker. KURTZMAN CARSON CONSULTANTS LLC is the claims agent. The Boeing Company, as DIP Agent, is represented by: Alan D. Smith, Esq. Perkins Coie LLP E-mail: ADSmith@perkinscoie.com - and - Kenneth J. Enos, Esq. Young Conaway Stargatt & Taylor, LLP E-mail: kenos@ycst.com * * * As reported by Troubled Company Reporter on June 2, 2021, Judge Brendan Linehan Shannon of the U.S. Bankruptcy Court for the District of Delaware authorized the bidding procedures proposed by TECT Aerospace Group Holdings Inc. and affiliates in connection with the auction sale of their Everett, Washington assets. TEMPO ACQUISITION: Moody's Hikes CFR to Ba3, Outlook Stable ----------------------------------------------------------- Moody's Investors Service upgraded Tempo Acquisition, LLC's (d/b/a Alight Solutions, "Alight") corporate family rating to Ba3, from B2, and its probability of default rating to Ba3-PD, from B2-PD. Moody's also upgraded the outsourced healthcare and retirement benefits administration services provider's first-lien debt, consisting of a $2.04 billion term loan, a $250 million revolver, and a $300 million notes issuance, to Ba3, from B1. The rating action stems from the company's July 6th-announced completion of its business combination with Foley Trasimene Acquisition Corp. ("Foley Trasimene"), a special purpose acquisition company, or SPAC, through which Alight has become a publicly traded company with substantially reduced leverage. Monies from cash on hand in the SPAC, from a forward purchase agreement with SPAC shareholders, and from a PIPE investment from numerous institutional investors will be used to take Alight public, pay a $1.00 billion dividend to Alight shareholders, pay down $1.79 billion of Alight's $4.13 billion of funded debt, and meet transaction expenses. Moody's has assigned an SGL-1 speculative-grade-liquidity rating, reflecting the newly public company's very good liquidity. Since Alight has paid down its $1.23 billion of 6.75% unsecured notes in their entirety, Moody's is withdrawing the notes' (Caa1) rating. Alight's ratings outlook, currently rating under review, has been changed to stable. Key drivers and governance considerations in the rating action include the material reduction in leverage, very good liquidity and improvement in market access stemming from public ownership. The rating actions conclude the review for upgrade that Moody's initiated on January 27, 2021. Issuer: Tempo Acquisition, LLC Upgraded: Corporate family rating, upgraded to Ba3, from B2 Probability of default rating, upgraded to Ba3-PD, from B2-PD Senior secured 1st lien bank credit facility, upgraded to Ba3 (LGD3), from B1 (LGD3) Senior secured 1st lien regular bond/debenture, upgraded to Ba3 (PD3), from B1 (LGD3) Ratings Withdrawn: Issuer: Tempo Acquisition, LLC GTD Senior Unsecured Notes, Withdrawn , previously rated Caa1 (LGD5) New Assignment: Speculative grade liquidity rating, assigned SGL-1 Outlook Actions: Issuer: Tempo Acquisition, LLC Outlook, changed to stable, from Rating under Review RATINGS RATIONALE The two-notch corporate ratings upgrade stems from Alight's markedly improved leverage, liquidity, and free cash flow profile expected after it reduces funded debt by 43% using proceeds from the SPAC transaction. Pro-forma for the transaction, Moody's-adjusted debt-to-EBITDA leverage as of year-end 2021 would decline to below 5.0 times, from close to 8.0 times at present. Since most of the repaid debt consists of the most expensive, unsecured notes, interest expense will be cut by about half, leading to Moody's-anticipated free cash flow of at least $250 million, or low-double-digit percentages of total debt. EBITDA coverage of interest would improve to at least 4.2 times in 2021, as compared with 2.6 times in 2020. Moody's views governance considerations as integral to Moody's ratings action. Alight will be a publicly traded company, with less than 50% private equity ownership. Post-transaction, Alight's eight-member board is expected to consist of three directors appointed by Foley Trasimene and three appointed by Blackstone (the largest current owner among a consortium of PE investors), Alight CEO Stephan Scholl, and one additional independent director. Improved capital market access and financial transparency are also governance consideration. Alight enjoys a long-term-contract-driven revenue model, and a $2.7 billion revenue base supported by a large, diverse set of customers whose largely white-collar employees have been generally insulated from the COVID pandemic's impacts. Its employee-benefits services constitute critical, embedded functions within its customers' operations. The Ba3 CFR reflects these stabilizing factors. The stable outlook reflects Moody's expectations for low-single-digit percentage revenue gains this year, accelerating in 2022, and the maintenance of strong free cash flows. Since debt-to-EBITDA leverage is somewhat high for the CFR, the outlook also takes into consideration Moody's expectation for deleveraging towards 4.5 times over the next 12 to 18 months. Moody's views Alight's liquidity as very good. Year-end 2020 cash had built to more than $500 million, and Moody's expect the balance to accumulate steadily towards a billion dollars by 2022, barring acquisitions or dividends. Strong free cash flow building on already high balance sheet cash leads to Moody's assignment of a speculative grade liquidity rating of SGL-1. Borrowings under the $250 million revolver are subject to compliance with a net secured leverage ratio of 7.5 times if utilization exceeds 35%, but cash balances will likely preclude the revolver from being drawn down. STRUCTURAL CONSIDERATIONS Because proceeds from the SPAC transaction will go towards eliminating expensive subordinated debt from the capital structure, first-lien debt will no longer benefit from the ratings support junior debt has heretofore provided. As such, Moody's Loss Given Default for Speculative-Grade Companies ("LGD") methodology dictates that instrument ratings on the first-lien debt, which now constitutes all debt in the capital structure, reflect directly the company's Ba3 CFR. FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS Moody's could upgrade Tempo's ratings if revenue growth is sustained in the mid-single-digit percentages; leverage moderates below 4.0 times on a sustained basis; Alight establishes a track record of conservative financial policies, and; the company maintains free cash flow as a percentage of debt in the upper-teens digits. The ratings could be downgraded if Moody's expects revenue will be flat; Moody's expects free cash flow to fall below 10% relative to total debt, or; Moody's expects total debt-to-EBITDA (Moody's adjusted) will remain above 5.0 times for an extended period. Tempo Acquisition, LLC (d/b/a Alight Solutions) is a leading provider of outsourced healthcare and retirement benefits administration services and human resources technology solutions. Affiliates of The Blackstone Group acquired Tempo from Aon PLC in 2017. The principal methodology used in these ratings was Business and Consumer Service Industry published in October 2016. U.S. TOBACCO: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Six affiliates that concurrently filed voluntary petitions under Chapter 11 of the Bankruptcy Code: Debtor Case No. ------ -------- U.S. Tobacco Cooperative Inc. (Lead Case) 21-01511 1304 Annapolis Drive Raleigh, NC 27608 U.S. Flue-Cured Tobacco Growers, Inc. 21-01513 Big South Distribution, LLC 21-01515 Franchise Wholesale Co., L.L.C. 21-01517 King Maker Marketing, Inc. 21-01518 Premier Manufacturing, Inc. 21-01519 Business Description: USTC produces U.S. flue-cured tobacco grown by 500+ member growers in Florida, Georgia, South Carolina, North Carolina, and Virginia. Member-grown tobacco is processed and sold as raw materials to cigarette manufacturers worldwide. Chapter 11 Petition Date: July 7, 2021 Court: United States Bankruptcy Court Eastern District of North Carolina Judge: Hon. Joseph N. Callaway Debtor's Counsel: Rebecca F. Redwine, Esq. HENDREN, REDWINE & MALONE, PLLC 4600 Marriott Drive Suite 150 Raleigh, NC 27612 Tel: (919) 420-7867 Fax: (919) 420-0475 E-mail: rredwine@hendrenmalone.com Estimated Assets: $100 million to $500 million Estimated Liabilities: $100 million to $500 million The petitions were signed by Keith H. Merrick, chief financial officer. Full-text copies of the petitions are available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/Z3XR44A/US_Tobacco_Cooperative_Inc__ncebke-21-01511__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/VIHBKRY/US_Flue-Cured_Tobacco_Growers__ncebke-21-01513__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/2YCFWFY/Big_South_Distribution_LLC__ncebke-21-01515__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/BGXHV5I/Franchise_Wholesale_Co_LLC__ncebke-21-01517__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/GCN3NVQ/King_Maker_Marketing_Inc__ncebke-21-01518__0001.0.pdf?mcid=tGE4TAMA https://www.pacermonitor.com/view/HO7ICXA/Premier_Manufacturing_Inc__ncebke-21-01519__0001.0.pdf?mcid=tGE4TAMA List of U.S. Tobacco Cooperative Inc.'s 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Aerotek Commercial Staffing $14,172 PO Box 198531 Atlanta, GA 30384-8531 2. Charter Communications (USFC) $10,136 PO Box 94188 Palatine, IL 60094-4188 3. CliftonLarsonAllen LLP $53,196 8215 Greenway Blvd Middleton, WI 53562 4. Degesch America Inc. $3,409 PO Box 116 Weyers Cave, VA 24486-0116 5. Dell Marketing LP $3,971 PO Box 534118 Atlanta, GA 30353-4118 6. Diligent Corporation $32,193 PO Box 419829 Boston, MA 02241-9874 7. Fidelity Investments Inst Ops $13,415 PO Box 73307 Chicago, IL 60673-7307 8. Golden Eagle Partnership LLC $19,350 120 Broadway New York, NY 10271 9. Iron Mountain $6,343 PO Box 27128 New York, NY 10087-7128 10. J&M Sales & Service, LLC $14,426 PO Box 3114 Wilson, NC 27893 11. Mcdermott Will & Emery $8,610 PO Box 6043 Chicago, IL 60680-6043 12. National Drayage Services $14,022 PO Box 62892 Baltimore, MD 21264 13. Nippon Express USA, Inc. $3,916 951 Aviation Parkway Morrisville, NC 27560 14. RR Donnelley $32,015 PO Box 538602 Atlanta, GA 30353-8602 15. Shawnee Technologies Inc. $29,747 12126 Asbury Chapel Rd Huntersville, NC 28078 16. Stoll Keenon Ogden PLLC $12,550 PO Box 11969 Lexington, KY 40579-1969 17. Time Warner Cable(PA) $10,885 PO Box 4617 Carol Stream, IL 60197-4617 18. Time Warner Cable(USTC) $5,691 PO Box 4617 Carol Stream, IL 60197-4617 19. Verizon Wireless $3,877 PO Box 660108 Dallas, TX 75266-0108 20. Watkins Tobacco Contractors, I $7,926 4585 Watkins Rd Oxford, NC 2756 VENOCO LLC: Trustee Asks Court Okay for $852 Mil. Spill Settlement ------------------------------------------------------------------ Law360 reports that the liquidating trustee for the Chapter 11 estate of bankrupt California oil driller and processor Venoco LLC has asked a Delaware judge to approve more than $852 million in unsecured claims to settle federal, state and private company oil spill cleanup and plant shutdown debts. Resolved in the proposed settlement filed Friday are allowances for most general unsecured claims, rather than actual payouts to the companies and agencies involved in the company's bankruptcy, which dates to 2017. It also documents the assignment of proceeds from more than $50 million in surety bonds to U. S. Department of the Interior agencies. About Venoco LLC Venoco, LLC, is a California-based and privately owned independent energy company primarily focused on the acquisition, exploration, production and development of oil and gas properties. As of April 2017, Venoco held interests in approximately 57,859 net acres, of which approximately 40,945 are developed. In the midst of a historic collapse in the oil and gas industry, Venoco, Inc., the predecessor in interest to Venoco, LLC, and six of Venoco, Inc.'s affiliates commenced voluntary Chapter 11 cases (Bankr. D. Del. Lead Case No. 16-10655) on March 18, 2016, in Delaware to address their overleveraged capital structure. In under four months, the 2016 Debtors confirmed a plan eliminating more than $1 billion in funded debt and other liabilities. On April 17, 2017, each of Venoco, LLC, and six of its subsidiaries filed Chapter 11 bankruptcy petitions (Bankr. D. Del. Lead Case No. 17-10828). As of the bankruptcy filing, the Debtors estimated assets in the range of $10 million to $50 million and liabilities of up to $100 million. Judge Kevin Gross presides over the 2017 cases. The Debtors have hired Morris, Nichols, Arsht & Tunnell LLP and Bracewell LLP as counsel; Zolfo Cooper LLC as restructuring and turnaround advisor; Seaport Global Securities LLC as financial advisor; and Prime Clerk LLC as claims, noticing and balloting agent. WASHINGTON PRIME: Seeks to Hire Jackson Walter as Co-Counsel ------------------------------------------------------------ Washington Prime Group Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Jackson Walker, LLP to serve as co-counsel with Kirkland & Ellis, LLP. The firm's services include: (a) legal advice regarding local rules, practices and procedures, including Fifth Circuit law; (b) certain services in connection with the administration of the Debtors' Chapter 11 cases, including, without limitation, preparing agendas, hearing notices, witness and exhibit lists, and hearing binders of documents and pleadings; (c) review of proposed drafts of pleadings to be filed with the court; (d) court appearances and attendance at meetings with the U.S. trustee and creditors; (e) legal advice on any matter on which the lead counsel may have a conflict or legal services needed based on specialization. The firm's hourly rates are as follows: Matthew D. Cavenaugh, Esq. $825 per hour Attorneys $435 - $935 per hour Paraprofessionals $185 - $195 per hour The Debtors agreed to pay $211,231.50 to the law firm as a retainer fee. Matthew Cavenaugh, Esq., the firm's attorney who will be providing the services, disclosed the following in response to the request for additional information set forth in Paragraph D.1. of the Revised U.S. Trustee Guidelines: Question: Did the firm agree to any variations from, or alternatives to, the firm's standard billing arrangements for this engagement? Answer: No. Jackson Walter and the Debtors have not agreed to any variations from, or alternatives to, the firm's standard billing arrangements for this engagement. The rate structure provided by the firm is appropriate and is not significantly different from (i) the rates that the Debtors charge for other non-bankruptcy representatives or (ii) the rates of other comparably skilled professionals. Question: Do any of the firm's professionals in this engagement vary their rate based on the geographical location of the Debtors' Chapter 11 cases? Answer: No. The hourly rates used by Jackson Walter in representing the Debtors are consistent with the rates that it charges other comparable Chapter 11 clients regardless of the location of the Chapter 11 case. Question: If the firm has represented the Debtors in the 12 months prepetition, disclose the firm's billing rates and material financial terms for the prepetition engagement, including any adjustments during the 12 months prepetition. If the firm's billing rates and material financial terms have changed post-petition, explain the difference and the reasons for the difference. Answer: Mr. Cavenaugh's hourly rate is $825. The rates of other restructuring attorneys at the firm range from $435 to $995 per hour while the paraprofessional rates range from $185 to $195 per hour. Jackson Walter represented the Debtors during the weeks immediately before the petition date using such hourly rates. Question: Have the Debtors approved the firm's budget and staffing plan, and if so, for what budget period? Answer: Jackson Walter has not prepared a budget and staffing plan. Mr. Cavenaugh also disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Jackson Walter can be reached at: Matthew D. Cavenaugh, Esq. Jackson Walker LLP 1401 McKinney Street, Suite 1900 Houston, TX 77010 Tel.: (713) 752-4200 Fax: (713) 752-4221 Email: mcavenaugh@jw.com About Washington Prime Group Washington Prime Group Inc. (NYSE: WPG) -- http://www.washingtonprime.com/-- is a retail REIT and a recognized leader in the ownership, management, acquisition and development of retail properties. It combines a national real estate portfolio with its expertise across the entire shopping center sector to increase cash flow through rigorous management of assets and provide new opportunities to retailers looking for growth throughout the U.S. Washington Prime Group and its affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 21-31948) on June 13, 2021. At the time of the filing, Washington Prime Group's property portfolio consists of material interests in 102 shopping centers in the United States totaling approximately 52 million square feet of gross leasable area. The company operates 97 of the 102 properties. As of March 31, 2021, Washington Prime Group had total assets of $4.029 billion against total liabilities of $3.471 billion. The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis International, LLP as lead bankruptcy counsel; Jackson Walker, LLP as co-counsel; Alvarez & Marsal North America, LLC as restructuring advisor; Guggenheim Securities, LLC as investment banker; Deloitte Tax, LLP as tax services provider; and Ernst & Young, LLP as auditor. Prime Clerk LLC is the claims agent, maintaining the page http://cases.primeclerk.com/washingtonprime SVPGlobal, the Debtors' lender, tapped Davis Polk & Wardwell, LLP and Evercore Group, LLC as its legal counsel and investment banker, respectively. WASHINGTON PRIME: Taps Alvarez & Marsal as Restructuring Advisor ---------------------------------------------------------------- Washington Prime Group Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Alvarez & Marsal North America, LLC to serve as restructuring advisor in their Chapter 11 cases. The firm's services include: (a) assisting the Debtors in the preparation of financial-related disclosures required by the court, including the Debtors' schedules of assets and liabilities, statements of financial affairs and monthly operating reports; (b) assisting in the identification and implementation of short-term cash management procedures; (c) assisting in the identification of executory contracts and leases and performing cost/benefit evaluations with respect to the affirmation or rejection of each; (d) assisting the Debtors' management team and legal counsel focused on the coordination of resources related to the ongoing reorganization effort; (e) assisting in the preparation of financial information for distribution to creditors and others, including, but not limited to, cash flow projections and budgets, cash receipts, disbursement analysis, analysis of various asset and liability accounts, and analysis of proposed transactions for which court approval is sought; (f) attending meetings and assisting in the discussions with potential investors, secured lenders, any official committee appointed in the cases, the U.S. trustee and other parties; (g) analyzing creditor claims by type, entity and individual claim and assisting in the development of databases to track such claims; (h) assisting the Debtors in the preparation of information and analysis necessary for the confirmation of a plan of reorganization; (i) assisting in the evaluation and analysis of avoidance actions, including fraudulent conveyances and preferential transfers; (j) giving advisory assistance on tax matters, including asset sale considerations, cancellation of debt income and tax attribute preservation, and cash tax projections; and (k) rendering such other general business consulting services as the Debtors' management or legal counsel may deem necessary consistent with the role of a restructuring advisor. The firm's hourly rates for the restructuring are as follows: Managing Directors $925 – 1,200 per hour Directors $725 – 900 per hour Analysts/Associates $425 – 700 per hour Meanwhile, the firm's hourly rates for the case management services are as follows: Managing Directors $900 – 1,050 per hour Directors $675 – 800 per hour Analysts/Consultants $400 – 650 per hour The Debtor paid $150,000 to the law firm as a retainer fee. Tony Simion, managing director at Alvarez & Marsal, disclosed in a court filing that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. About Washington Prime Group Washington Prime Group Inc. (NYSE: WPG) -- http://www.washingtonprime.com/-- is a retail REIT and a recognized leader in the ownership, management, acquisition and development of retail properties. It combines a national real estate portfolio with its expertise across the entire shopping center sector to increase cash flow through rigorous management of assets and provide new opportunities to retailers looking for growth throughout the U.S. Washington Prime Group and its affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 21-31948) on June 13, 2021. At the time of the filing, Washington Prime Group's property portfolio consists of material interests in 102 shopping centers in the United States totaling approximately 52 million square feet of gross leasable area. The company operates 97 of the 102 properties. As of March 31, 2021, Washington Prime Group had total assets of $4.029 billion against total liabilities of $3.471 billion. The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis International, LLP as lead bankruptcy counsel; Jackson Walker, LLP as co-counsel; Alvarez & Marsal North America, LLC as restructuring advisor; Guggenheim Securities, LLC as investment banker; Deloitte Tax, LLP as tax services provider; and Ernst & Young, LLP as auditor. Prime Clerk LLC is the claims agent, maintaining the page http://cases.primeclerk.com/washingtonprime SVPGlobal, the Debtors' lender, tapped Davis Polk & Wardwell, LLP and Evercore Group, LLC as its legal counsel and investment banker, respectively. WASHINGTON PRIME: Taps Kirkland & Ellis as Lead Bankruptcy Counsel ------------------------------------------------------------------ Washington Prime Group Inc. and its affiliates seek approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Kirkland & Ellis LLP and Kirkland & Ellis International LLP to serve as lead counsel in their Chapter 11 cases. Kirkland's services include: (a) advising the Debtors with respect to their powers and duties in the continued management and operation of their businesses and properties; (b) advising and consulting on the conduct of the cases, including all of the legal and administrative requirements of operating in Chapter 11; (c) attending meetings and negotiating with representatives of creditors and other parties in interest; (d) taking all necessary actions to protect and preserve the Debtors' estates, including prosecuting actions on the Debtors' behalf, defending any action commenced against the Debtors, and representing the Debtors in negotiations concerning litigation in which they are involved, including objections to claims filed against the estates; (e) preparing pleadings; (f) representing the Debtors in connection with obtaining authority to continue using cash collateral and post-petition financing; (g) advising the Debtors in connection with any potential sale of their assets; (h) appearing before the bankruptcy court and any appellate courts to represent the interests of the Debtors' estates; (i) advising the Debtors regarding tax matters; (j) taking any necessary action to negotiate, prepare, and obtain approval of a disclosure statement and confirmation of a Chapter 11 plan and all documents related thereto; and (k) performing all other necessary legal services for the Debtors in connection with the prosecution of their cases, including (i) analyzing the Debtors' leases and contracts and the assumption and assignment or rejection thereof; (ii) analyzing the validity of liens against the Debtors; and (iii) advising the Debtors on corporate and litigation matters. Kirkland's hourly rates are as follows: Partners $1,080 - $1,895 per hour Of Counsel $625 - $1,845 per hour Associates $625 - $1,195 per hour Paraprofessionals $255 - $475 per hour The Debtors paid a total of $14,000,000 to Kirkland as retainer fee. Chad Husnick, Esq., one of Kirkland's lead attorneys, disclosed the following in response to the request for additional information set forth in Paragraph D.1. of the Revised U.S. Trustee Guidelines: a. Question: Did Kirkland agree to any variations from, or alternatives to, Kirkland's standard billing arrangements for this engagement? Answer: No. Kirkland and the Debtors have not agreed to any variations from, or alternatives to, Kirkland's standard billing arrangements for this engagement. The rate structure provided by Kirkland is appropriate and is not significantly different from (i) the rates that Kirkland charges for other non-bankruptcy representations or (ii) the rates of other comparably skilled professionals. b. Question: Do any of the Kirkland professionals in this engagement vary their rate based on the geographic location of the Debtors' chapter 11 cases? Answer: No. The hourly rates used by Kirkland in representing the Debtors are consistent with the rates that Kirkland charges other comparable Chapter 11 clients, regardless of the location of the Chapter 11 case. c. Question: If Kirkland has represented the Debtors in the 12 months prepetition, disclose Kirkland's billing rates and material financial terms for the prepetition engagement, including any adjustments during the 12 months prepetition. If Kirkland's billing rates and material financial terms have changed post-petition, explain the difference and the reasons for the difference. Answer: Kirkland's current hourly rates for services rendered on behalf of the Debtors range as follows: Billing Category U.S. Range ---------------- ---------- Partners $1,080 - $1,895 Of Counsel $625 - $1,845 Associates $625 - $1,195 Paraprofessionals $255 - $475 Kirkland represented the Debtors from Jan. 1 to Dec. 31, 2020 using the following hourly rates: Billing Category U.S. Range ---------------- ---------- Partners $1,075 - $1,845 Of Counsel $625 - $1,845 Associates $625 - $1,165 Paraprofessionals $245 - $460 d. Question: Have the Debtors approved Kirkland's budget and staffing plan, and, if so, for what budget period? Answer: Yes, for the period from June 13 to Sept. 30, 2021. Mr. Husnick also disclosed in a court filing that Kirkland is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Kirkland can be reached at: Chad J. Husnick, P.C. Kirkland & Ellis LLP Kirkland & Ellis International LLP 300 North LaSalle Street Chicago, IL 60654 Tel: (312) 862-2000 Fax: (312) 862-2200 Email: chad.husnick@kirkland.com - and - Joshua A. Sussberg, P.C. Alexander J. Nicas, Esq. Kirkland & Ellis LLP Kirkland & Ellis International LLP 601 Lexington Avenue New York, NY 10022 Tel: (212) 446-4800 Fax: (212) 446-4900 Email: jsussberg@kirkland.com alexander.nicas@kirkland.com About Washington Prime Group Washington Prime Group Inc. (NYSE: WPG) -- http://www.washingtonprime.com/-- is a retail REIT and a recognized leader in the ownership, management, acquisition and development of retail properties. It combines a national real estate portfolio with its expertise across the entire shopping center sector to increase cash flow through rigorous management of assets and provide new opportunities to retailers looking for growth throughout the U.S. Washington Prime Group and its affiliates sought Chapter 11 protection (Bankr. S.D. Texas Lead Case No. 21-31948) on June 13, 2021. At the time of the filing, Washington Prime Group's property portfolio consists of material interests in 102 shopping centers in the United States totaling approximately 52 million square feet of gross leasable area. The company operates 97 of the 102 properties. As of March 31, 2021, Washington Prime Group had total assets of $4.029 billion against total liabilities of $3.471 billion. The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis International, LLP as lead bankruptcy counsel; Jackson Walker, LLP as co-counsel; Alvarez & Marsal North America, LLC as restructuring advisor; Guggenheim Securities, LLC as investment banker; Deloitte Tax, LLP as tax services provider; and Ernst & Young, LLP as auditor. Prime Clerk LLC is the claims agent, maintaining the page http://cases.primeclerk.com/washingtonprime SVPGlobal, the Debtors' lender, tapped Davis Polk & Wardwell, LLP and Evercore Group, LLC as its legal counsel and investment banker, respectively. WCOP INC: Seeks to Employ Bill Marinakos as Accountant ------------------------------------------------------ WCOP, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Illinois to hire Bill J. Marinakos of Tsoutsias, Balabanos & Associates, Ltd. as its accountant. The services to be provided by the accountant include the preparation of tax returns, weekly payroll and monthly financial reports, and monthly filing of sales taxes. Mr. Marinakos will be paid a monthly fee of $1,500 for such services and an hourly fee of $150 for additional services. Mr. Marinakos disclosed in a court filing that he is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. The accountant can be reached at: Bill J. Marinakos Tsoutsias, Balabanos & Associates, Ltd. 234 Waukegan Road Glenview, IL 60025-5159 Phone: (847) 998-0557 About WCOP Inc. Chicago-based WCOP, Inc. sought Chapter 11 protection (Bankr. N.D. Ill. Case No. 21-04679) on April 9, 2021. In the petition signed by Pasquale Lucchetto, president, the Debtor disclosed total assets of up to $50,000 and total liabilities of up to $10 million. Judge Lashonda A. Hunt presides over the case. Kevin Benjamin, Esq., of Benjamin Legal Services, PLC and Bill J. Marinakos of Tsoutsias, Balabanos & Associates, Ltd. serve as the Debtor's bankruptcy counsel and accountant, respectively. WEINSTEIN CO: Accuser Can Recover Chapter 11 Mediation Costs ------------------------------------------------------------ Law360 reports that an accuser of disgraced film mogul Harvey Weinstein received approval Tuesday, July 6, 2021 from a Delaware bankruptcy judge to be reimbursed for expenses incurred in the Chapter 11 case of The Weinstein Co. after reaching a deal with the former debtor's liquidation trustee. During a virtual hearing, U.S. Bankruptcy Judge Mary F. Walrath said former actress, screenwriter and producer Louisette Geiss was entitled to the $118,000 in expenses she incurred while pursuing a settlement with the company for all victims of sexual abuse at the hands of Weinstein. About The Weinstein Company The Weinstein Company (TWC) -- http://www.WeinsteinCo.com/-- is a multimedia production and distribution company launched in 2005 in New York by Bob and Harvey Weinstein, the brothers who founded Miramax Films in 1979. TWC also encompasses Dimension Films, the genre label founded in 1993 by Bob Weinstein. During Harvey and Bob's tenure at Miramax and TWC, they have received 341 Oscar nominations and won 81 Academy Awards. TWC dismissed Harvey Weinstein in October 2017, after dozens of women came forward to accuse him of sexual harassment, assault or rape. 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. 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 official committee of unsecured creditors retained Pachulski Stang Ziehl & Jones, LLP as its legal counsel, and Berkeley Research Group, LLC, as its financial advisor. ZUCA PROPERTIES: Seeks to Employ Compass Inc. as Real Estate Broker ------------------------------------------------------------------- Zuca Properties seeks approval from the U.S. Bankruptcy Court for the Southern District of New York to hire Compass, Inc., a New York-based real estate broker, to market for sale two SoHo penthouse condominium units. The firm will be paid a 5 percent commission on the sale price at closing. In a court filing, Bryan Collins of Compass, Inc. disclosed that his firm is a "disinterested person" as the term is defined in Section 101(14) of the Bankruptcy Code. Compass, Inc. can be reached through: Bryan Collins Compass, Inc. 90 Fifth Avenue, 3rd Floor New York, NY 10011 Office: 212.913.9058 Mobile: 917-741-1719 Email: bryan.collins@compass.com About Zuca Properties Zuca Properties is a member-managed limited liability company organized under the laws of the State of Delaware, having its corporate headquarters at c/o JTC (Suisse) S.A., 80-84 Rue du Rhone, 1204 Geneva, Switzerland. The Debtor was established by Rahula Withanage on May 22, 2009 as a limited liability company under Delaware law. On Sept. 29, 2009, Mr. Withanage transferred all of his membership interest in the Debtor to The Woofy Trust. The trust was established on Sept. 17, 2009 under English law, and Mr. Withanage is the settlor of the trust. The trust is currently the sole member of the Debtor with 100 percent ownership interest. JTC (Suisse) S.A. serves as the trustee. Zuca Properties sought Chapter 11 protection (Bankr. S.D.N.Y. Case No. 21-11082) on June 7, 2021. At the time of the filing, the Debtor disclosed total assets of up to $50 million and total liabilities of up to $100 million. Togut, Segal & Segal, LLP serves as the Debtor's legal counsel. [^] Recent Small-Dollar & Individual Chapter 11 Filings ------------------------------------------------------- In re Joyful Care Caregiving Services, Inc. Bankr. C.D. Cal. Case No. 21-11648 Chapter 11 Petition filed June 30, 2021 See https://www.pacermonitor.com/view/IVW2JRY/Joyful_Care_Caregiving_Services__cacbke-21-11648__0001.0.pdf?mcid=tGE4TAMA represented by: Joon M. Khang, Esq. KHANG & KHANG LLP E-mail: joon@khanglaw.com In re Zhanna Kvartina Bankr. D.N.J. Case No. 21-15352 Chapter 11 Petition filed June 30, 2021 represented by: Alla Kachan, Esq. In re Roosevelt Properties Inc. Bankr. E.D.N.Y. Case No. 21-71201 Chapter 11 Petition filed June 30, 2021 See https://www.pacermonitor.com/view/EMI66QI/Roosevelt_Properties_Inc__nyebke-21-71201__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re Louis Quint, Jr. Bankr. D. Ore. Case No. 21-31466 Chapter 11 Petition filed June 30, 2021 represented by: Michael O'Brien, Esq. In re Joseph R. Reisinger Bankr. M.D. Pa. Case No. 21-01474 Chapter 11 Petition filed June 30, 2021 represented by: Ryan Eshelman, Esq. In re Alma Roy Roundy Bankr. D. Utah Case No. 21-22878 Chapter 11 Petition filed June 30, 2021 represented by: Matthew Boley, Esq. In re Guardian Portfolio Services, Inc. Bankr. M.D. Fla. Case No. 21-03499 Chapter 11 Petition filed July 1, 2021 See https://www.pacermonitor.com/view/6ER224A/Guardian_Portfolio_Services_Inc__flmbke-21-03499__0001.0.pdf?mcid=tGE4TAMA represented by: Buddy D. Ford, Esq. BUDDY D. FORD, P.A. E-mail: All@tampaesq.com In re Edwin P. Randolph, Attorney at Law, LLC Bankr. M.D. Fla. Case No. 21-03506 Chapter 11 Petition filed July 1, 2021 See https://www.pacermonitor.com/view/ABMQY6I/Edwin_P_Randolph_Attorney_at_Law__flmbke-21-03506__0001.0.pdf?mcid=tGE4TAMA represented by: James W. Elliott, Esq. MCINTYRE THANASIDES BRINGGOLD ELLIOTT, ET AL. E-mail: James@mcintyrefirm.com In re LJA Ventures, Inc. dba Midtown Live Sports Cafe Bankr. W.D. Tex. Case No. 21-10541 Chapter 11 Petition filed July 1, 2021 See https://www.pacermonitor.com/view/QPF3WEA/LJA_Ventures_Inc_dba_Midtown_Live__txwbke-21-10541__0001.0.pdf?mcid=tGE4TAMA represented by: Darwin McKee, Esq. DARWIN MCKEE, ATTORNEY AT LAW E-mail: darwinmckee@yahoo.com In re Bhatt Corporation Bankr. N.D. Ala. Case No. 21-40661 Chapter 11 Petition filed July 2, 2021 See https://www.pacermonitor.com/view/OLOSVBA/Bhatt_Corporation__alnbke-21-40661__0001.0.pdf?mcid=tGE4TAMA represented by: Harry P. Long, Esq. THE LAW OFFICES OF HARRY P. LONG, LLC E-mail: hlonglegal8@gmail.com In re David Carl Goad Bankr. C.D. Cal. Case No. 21-13652 Chapter 11 Petition filed July 2, 2021 represented by: Monica Yepes, Esq. In re Jennifer Leigh Hodges Bankr. C.D. Cal. Case No. 21-11662 Chapter 11 Petition filed July 2, 2021 represented by: Misty Perry Isaacson, Esq. In re Robert Gabriel Bankr. C.D. Cal. Case No. 21-15466 Chapter 11 Petition filed July 2, 2021 represented by: Onyinye Anyama, Esq. In re Filos Catering, Inc. Bankr. E.D. Cal. Case No. 21-11704 Chapter 11 Petition filed July 2, 2021 See https://www.pacermonitor.com/view/FI2GM2A/FILOS_CATERING_INC__caebke-21-11704__0001.0.pdf?mcid=tGE4TAMA represented by: Leonard K. Welsh, Esq. LAW OFFICE OF LEONARD K. WELSH E-mail: lwelsh@lkwelshlaw.com In re Princesca N. Ene Bankr. N.D. Cal. Case No. 21-50901 Chapter 11 Petition filed July 2, 2021 represented by: Michael Lee, Esq. LEE BANKRUPTCY & RESTRUCTURING COUNSEL Email: Michael.Lee@Lee-Li.com In re Publius Valerius Publicola, LLC Bankr. S.D. Tex. Case No. 21-32258 Chapter 11 Petition filed July 3, 2021 See https://www.pacermonitor.com/view/O2JARBY/Publius_Valerius_Publicola_LLC__txsbke-21-32258__0001.0.pdf?mcid=tGE4TAMA represented by: Margaret M. McClure, Esq. LAW OFFICE OF MARGARET M. MCCLURE E-mail: margaret@mmmcclurelaw.com In re Steven Erich Hubbard Bankr. M.D. Tenn. Case No. 21-02050 Chapter 11 Petition filed July 4, 2021 In re Murcia Group, Inc. Bankr. S.D. Fla. Case No. 21-16618 Chapter 11 Petition filed July 5, 2021 See https://www.pacermonitor.com/view/NPUABPY/Murcia_Group_Inc__flsbke-21-16618__0001.0.pdf?mcid=tGE4TAMA represented by: Mercy Saladrigas, Esq. SALADRIGAS LAW CENTER E-mail: courtnotice@saladrigaslaw.com In re Scott Loren Leventhal Bankr. N.D. Ga. Case No. 21-55036 Chapter 11 Petition filed July 5, 2021 In re Meyrans 3, Inc. Bankr. W.D. Pa. Case No. 21-21549 Chapter 11 Petition filed July 5, 2021 See https://www.pacermonitor.com/view/O3AGVBI/Meyrans_3_Inc__pawbke-21-21549__0001.0.pdf?mcid=tGE4TAMA represented by: Jeffrey T. Morris, Esq. ELLIOTT & DAVIS, PC E-mail: morris@elliott-davis.com In re 633 Smithfield LLC Bankr. W.D. Pa. Case No. 21-21550 Chapter 11 Petition filed July 5, 2021 See https://www.pacermonitor.com/view/PKZ6MEY/633_Smithfield_LLC__pawbke-21-21550__0001.0.pdf?mcid=tGE4TAMA represented by: Jeffrey T. Morris, Esq. ELLIOTT & DAVIS, PC E-mail: morris@elliott-davis.com In re Inner City Builders and Developers, LLC Bankr. S.D. Tex. Case No. 21-60061 Chapter 11 Petition filed July 5, 2021 See https://www.pacermonitor.com/view/SGWGNHY/Inner_City_Builders_and_Developers__txsbke-21-60061__0001.0.pdf?mcid=tGE4TAMA represented by: Brendon Dane Singh, Esq. TRAN SINGH, LLP E-mail: bsingh@ts-llp.com In re Shaan and Khan Inc. Bankr. S.D. Tex. Case No. 21-32277 Chapter 11 Petition filed July 5, 2021 See https://www.pacermonitor.com/view/CFEUGGY/Shaan_and_Khan_Inc__txsbke-21-32277__0001.0.pdf?mcid=tGE4TAMA represented by: James Q. Pope, Esq. THE POPE LAW FIRM E-mail: jamesp@thepopelawfirm.com In re LE Business and Properties Group LLC Bankr. C.D. Cal. Case No. 21-15495 Chapter 11 Petition filed July 6, 2021 See https://www.pacermonitor.com/view/F2D5APA/LE_Business_and_Properties_Group__cacbke-21-15495__0001.0.pdf?mcid=tGE4TAMA Filed Pro Se In re Margarito Guerrero Bankr. C.D. Cal. Case No. 21-11166 Chapter 11 Petition filed July 6, 2021 represented by: Lionel Giron, Esq. In re Fielding and Xix Flamingo Holdings LLC Bankr. N.D. Ga. Case No. 21-55048 Chapter 11 Petition filed July 6, 2021 In re SD Import, LLC Bankr. E.D. Mich. Case No. 21-45687 Chapter 11 Petition filed July 6, 2021 See https://www.pacermonitor.com/view/PNAM4CA/SD_Import_LLC__miebke-21-45687__0001.0.pdf?mcid=tGE4TAMA represented by: John J. Stockdale, Jr. SCHAFER AND WEINER, PLLC E-mail: jstockdale@schaferandweiner.com In re Select Distributors, LLC Bankr. E.D. Mich. Case No. 21-45689 Chapter 11 Petition filed July 6, 2021 See https://www.pacermonitor.com/view/XI7G2CI/Select_Distributors_LLC__miebke-21-45689__0001.0.pdf?mcid=tGE4TAMA represented by: John J. Stockdale, Jr., Esq. SCHAFER AND WEINER, PLLC E-mail: jstockdale@schaferandweiner.com In re Ashbrooke Development, LLC Bankr. E.D. Mich. Case No. 21-45699 Chapter 11 Petition filed July 6, 2021 See https://www.pacermonitor.com/view/L3TM4DA/Ashbrooke_Development_LLC__miebke-21-45699__0001.0.pdf?mcid=tGE4TAMA represented by: Elliot G. Crowder, Esq. STEVENSON & BULLOCK, P.L.C. E-mail: ecrowder@sbplclaw.com In re Empire-Dominion Development, LLC Bankr. D. Nev. Case No. 21-13399 Chapter 11 Petition filed July 6, 2021 See https://www.pacermonitor.com/view/VDSHPEA/EMPIRE-DOMINION_DEVELOPMENT_LLC__nvbke-21-13399__0001.0.pdf?mcid=tGE4TAMA represented by: Jeffrey J. Whitehead, Esq. WHITEHEAD & BURNETT E-mail: jeff@whiteheadburnett.com In re East West AVL Dev, LLC Bankr. W.D.N.C. Case No. 21-10134 Chapter 11 Petition filed July 6, 2021 See https://www.pacermonitor.com/view/A4WBZJA/East_West_AVL_Dev_LLC__ncwbke-21-10134__0001.0.pdf?mcid=tGE4TAMA represented by: Samantha K. Brumbaugh, Esq. IVEY, MCCLELLAN, SIEGMUND, BRUMBAUGH & MCDONOUGH, LLP In re Larry Paul Howell Bankr. N.D. Tex. Case No. 21-31250 Chapter 11 Petition filed July 6, 2021 represented by: Jeffery Carruth, Esq. In re Household of Faith Community Church Bankr. S.D. Tex. Case No. 21-32288 Chapter 11 Petition filed July 6, 2021 See https://www.pacermonitor.com/view/6MFJBEY/Household_of_Faith_Community_Church__txsbke-21-32288__0001.0.pdf?mcid=tGE4TAMA represented by: James Q. Pope, Esq. THE POPE LAW FIRM E-mail: jamesp@thepopelawfirm.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. 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