/raid1/www/Hosts/bankrupt/TCR_Public/220413.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, April 13, 2022, Vol. 26, No. 102
Headlines
DIOCESE OF NORWICH: Plan Filing Deadline Extended to Mid-June
152 S IRVING: Claims Will be Paid from Property Refinance
6 TURTLE KNOLL: Unsecured Creditors Will Get 100% of Claims in Plan
A.B.C. OF NORTH: Case Summary & Four Unsecured Creditors
ALDERBRIDGE WAY: Gets Initial CAA Stay Order; A&M as Monitor
AMS INC: S&P Raises 2022 Revenue Bonds Long-Term Rating to 'BB+
ANGEL'S SQUARE: April 27 Plan Confirmation Hearing Set
ARAS BUSINESS: Voluntary Chapter 11 Case Summary
BOY SCOUTS OF AMERICA: Final Arguments Start in Bankruptcy Case
BOY SCOUTS: Guam Abuse Claimants Balk at Releases of Diocese
BRIGHTVIEW LANDSCAPES: S&P Alters Outlook to Neg, Affirms 'B+' ICR
BRONZE KINGDOM: Unsecureds to Split $12K in Consensual Plan
CD&R VIALTO: S&P Assigns 'B-' ICR on Acquisition by CD&R
CDK GLOBAL: S&P Places 'BB+' Long-Term ICR on CreditWatch Negative
CHARMING CHARLIE: Reaches Tentative WARN Suit Settlement
CITE LLC: Wins Cash Collateral Access Thru April 30
CONTINENTAL COUNTRY CLUB: Wins Cash Collateral Access
ECTOR COUNTY ENERGY: Case Summary & 20 Largest Unsecured Creditors
ECTOR COUNTY: Seeks Cash Collateral Access Thru May 1
EL MONTE NATURE: Case Summary & 13 Unsecured Creditors
FILIPINOFLASH LLC: Files for Chapter 11 Bankruptcy Protection
FLEX ELECTRICAL: Case Summary & 20 Largest Unsecured Creditors
GASHI & HAN: Wins Interim Cash Collateral Access
GML LOGISTICS: Medium Unsecured to Get $129 Per Month for 72 Months
GTT COMMUNICATIONS: Announces New Directors for Chapter 11 Exit
HOLMDEL FINANCIAL: Gets Court Nod to Use Cash Collateral
HOMELIBERTY INC: Case Summary & Six Unsecured Creditors
JK 325 LLC: Case Summary & Two Unsecured Creditors
MAJESTIC HILLS: May 12 Disclosure Statement Hearing Set
NEW BROUGHTON: Case Summary & Two Unsecured Creditors
NORDIC AVIATION: Further Fine-Tunes Plan Documents
NUVEDA LLC: Case Summary & Four Unsecured Creditors
PADDOCK ENTERPRISES: Unsecured Creditors Unimpaired in Plan
PHOENIX PROPERTIES: Bid to Access Cash Collateral Denied as Moot
QUEEN ELIZABETH: BofA Says Claim Oversecured, Should be Paid 100%
RESTORNATIONS: Court Denies Approval of Disclosure Statement
SAVANNAH CAPITAL: Case Summary & Four Unsecured Creditors
SEARS HOLDINGS: Judge Orders Creditors, Ex-Chairman to Mediation
SHURWEST LLC: Some Creditors Hit 'Sham' Bankruptcy Plan
SOUND HOUSING: Property Sale Proceeds to Fund Plan Payments
SUNGARD AS: Case Summary & 30 Largest Unsecured Creditors
SUNGARD AS: Seeks Cash Collateral Access, $336M DIP Loan
TARINA TARANTINO: Seeks Chapter 11 Bankruptcy Protection
TEA STATION: Unsecured Creditors to Split $64K in Subchapter V Plan
TELIGENT INC: Chapter 11 Plan Will Pay Ares Capital $32.6 Million
TOP LINE GRANITE: Wins Interim Cash Collateral Access
TRI-WIRE ENGINEERING: JPM Settlement-Based Plan Backed by Committee
TUPPERWARE BRANDS: S&P Withdraws 'B+' ICR, Outlook Stable
VERACODE INC: Fitch Assigns 'B' LongTerm IDR, Outlook Stable
VERACODE PARENT: S&P Affirms 'B-' ICR on TA Associates Acquisition
VERMILION ENERGY: S&P Raises ICR to 'B+' on Strong Credit Measures
VICTORIA TOWERS: Claims to be Paid From Sale of Property
[] New Hampshire Bankruptcy Filings Rose 53% in March 2022
*********
DIOCESE OF NORWICH: Plan Filing Deadline Extended to Mid-June
--------------------------------------------------------------
Joe Wojtas of The Day reports that a federal bankruptcy judge has
extended the deadline for the Diocese of Norwich to file its
bankruptcy plan until June 14, 2022.
The deadline had been April 15, 2022 but Judge James Tancredi
extended the deadline last week. The Roman Catholic diocese then
will have until Aug. 15 to solicit votes from creditors on whether
they accept the plan.
The two-month extension also is designed to give the diocese and
its creditors an opportunity to engage in mediation to resolve
outstanding issues involved in the bankruptcy. These typically can
involve liability, damages, assets and ability to pay, future
claims and more.
Attorney Stephen Kindseth, whose firm Ziegler and Ziegler of
Bridgeport represents the committee of creditors, said Thursday
that mediation is very often extremely helpful in facilitating a
resolution of a case. If the parties can reach an agreement through
mediation, it will not only resolve the case more quickly but avoid
more money being spent on legal and professional fees.
"The committee of creditors is very hopeful that the mediation
process will be able to maximize the recovery for the (sexual
abuse) survivors," he said.
The diocese filed for Chapter 11 bankruptcy in July as it faced
more than 60 lawsuits filed by men who say they were sexually
assaulted as boys by Christian Brothers and other staff at the
diocese-run Mount Saint John Academy, a school for troubled boys in
Deep River, from 1990 to 2002. Since then additional people, whose
sexual assault allegations involved not only the school but
diocesan churches, have filed claims in the bankruptcy case. In
addition, various other creditors will be seeking a portion of the
diocese's assets.
The bankruptcy process, which freezes lawsuits against the diocese,
will assess the assets of the diocese and determine how much each
victim will receive in damages. The 51 parishes in the diocese have
joined the diocese in seeking bankruptcy protection from sexual
abuse claims and will have to contribute funds to the settlement.
This would leave victims unable to sue the parishes in the future.
March 15, 2022 was the deadline for victims and other creditors to
file claims in the case.
About The Norwich Roman Catholic
Diocesan Corporation
The Norwich Roman Catholic Diocesan Corporation is a nonprofit
corporation that gives endowments to parishes, schools, and other
organizations in the Diocese of Norwich, a Latin Church
ecclesiastical territory or diocese of the Catholic Church in
Connecticut and a small part of New York.
The Norwich Roman Catholic Diocesan Corporation sought Chapter 11
protection (Bankr. D. Conn. Case No. 21-20687) on July 15, 2021.
The Debtor estimated $10 million to $50 million in assets against
liabilities of more than $50 million. Judge James J. Tancredi
oversees the case.
The Debtor tapped Ice Miller, LLP as bankruptcy counsel and
Robinson & Cole, LLP as Connecticut counsel. Epiq Corporate
Restructuring, LLC, is the claims and noticing agent.
On July 29, 2021, the U.S. Trustee for Region 2 appointed an
official committee of unsecured creditors in this Chapter 11 case.
The committee tapped Zeisler & Zeisler, PC as its legal counsel.
152 S IRVING: Claims Will be Paid from Property Refinance
---------------------------------------------------------
Colon Venture Group, LLC, a debtor-affiliate of the Debtor 152 S.
Irving GC, LLC ("152 S. Irving"), submitted a Disclosure Statement
describing Chapter 11 Reorganization Plan dated April 5, 2022.
152 S. Irving and the Debtor are single asset real estate entities.
152 S. Irving was formed for the sole purpose of rehabilitating and
selling the real property located at 152 South Irving Street,
Ridgewood, New Jersey 07450 (the "Ridgewood Property") (the
Manville Property and Ridgewood Property collectively referred to
as the "Properties").
The Debtor's only asset, the Manville Property, was utilized as
additional collateral to borrow funds from Anchor Loans, in order
to complete the rehabilitation project at the Ridgewood Property.
152 S. Irving and the Debtor have had no other business operations
stemming from ownership of the real properties.
On January 3, 2022, the Debtor filed a voluntary petition for
relief pursuant to Chapter 11 of the Bankruptcy Code. Thereafter,
on January 13, 2022, 152 S. Irving (an affiliated entity of the
Debtor) also filed a voluntary petition for relief pursuant to
Chapter 11 of the Bankruptcy Code. On February 22, 2022, the Court
granted the joint administration of both bankruptcy cases, with the
case of 152 S. Irving being the lead case.
At the outset of the Debtor's case, Anchor held a commercial
mortgage against the Properties in the approximate amount of
$1,283,041.00. Most of Anchor’s claim will be paid at closing
from the sale of the Ridgewood Property. The sale of the Ridgewood
Property is set to close on March 24, 2022. The unpaid balance of
Anchor's claim, in the estimated amount of $109,0002, will remain
as a lien on the Manville Property.
The Debtor is currently not generating income and is occupied by
one of its members who has been maintaining current with taxes and
insurance owed on the Manville Property. The Debtor's only asset,
the Manville Property, is currently valued at $315,875.00. In this
Reorganization Plan, the Debtor proposes to pay creditors in full
and fund the Plan by refinancing the Manville Property and using
the funds to pay the remainder of Anchor's claim in full.
This is a reorganization plan. The Debtor will fund the Plan from
the refinancing of its real estate located at 1015 Green Street,
Manville, New Jersey 08835 (the "Manville Property"). The Effective
Date of the proposed Plan is thirty days after entry of the order
confirming the Plan unless the Plan or confirmation order provides
otherwise.
Class One consists of a secured claim held by Anchor Loans, LP.
This creditor has a secured claim in the amount of $1,283,041. The
Debtor shall refinance the Manville Property within 6 months from
the entry of the Confirmation Order and proceeds shall be used to
pay the remaining balance owed on the secured claim to Anchor in
full. Anchor will be paid at the closing of the refinancing of the
Manville Property pursuant to a written payoff statement provided
by Anchor.
Class 2 consists of the ownership interest of the Debtor in its
respective assets, which are not otherwise abandoned pursuant to
the Plan. The ownership interests of the Debtor in its assets shall
not be altered as a consequence of the Plan.
The Plan will be funded from proceeds from the refinancing of the
Manville Property. The entry of the Order Confirming the Debtor's
Plan shall serve as authorization for the Debtor to refinance the
Manville Property, and use proceeds to fund the Plan.
A full-text copy of the Disclosure Statement dated April 5, 2022,
is available at https://bit.ly/3jpcXCN from PacerMonitor.com at no
charge.
Debtor's Counsel:
Carlos D. Martinez, Esq.
SCURA, WIGFIELD, HEYER, STEVENS & CAMMAROTA, LLP
1599 Hamburg Turnpike
Wayne, NJ 07470
Tel: 973-696-8391
Email: cmartinez@scura.com
About 152 S Irving
152 S Irving CG LLC is a Single Asset Real Estate debtor (as
defined in 11 U.S.C. Section 101(51B)).
The Debtor filed Chapter 11 Petition (Bankr. D.N.J. Case No. 22
10294) on January 13, 2022. In the petition signed by Jonathan
Greenstein, authorized representative, the Debtor disclosed
$500,000 to $1 million in assets and $1 million to $10 million in
liabilities. The Hon. Kathryn C. Ferguson oversees the case.
David L. Stevens, Esq. of SCURA, WIGFIELD, HEYER, STEVENS &
CAMMAROTA, LLP is the Debtor's Counsel.
6 TURTLE KNOLL: Unsecured Creditors Will Get 100% of Claims in Plan
-------------------------------------------------------------------
6 Turtle Knoll, LLC, filed with the U.S. Bankruptcy Court for the
Southern District of New York a Disclosure Statement describing
Plan of Reorganization dated April 5, 2022.
The Debtor is a Limited Liability Corporation organized under the
laws of the State of New York on March 28, 2018, for the purpose of
managing the real property located at 6 Turtle Knoll, Monroe, NY
10950 (the "Property").
The Property is situated on an 18-acre plot that is zoned for rural
residential usage and accessible via private road. The Property has
a fair market value of $465,000.00 pursuant to a full interior and
exterior appraisal obtained by the Debtor.
Prior to the Debtor's bankruptcy court filing, the Debtor listed
the Property for Sale several times in 2020, and eventually,
obtained a buyer, but BSI would not approve the short sale The
Property was scheduled to be sold at a foreclosure auction sale on
February 22, 2022; however, same was stayed by the Debtor's
bankruptcy case filing.
The Debtor's Plan proposes to pay to secured portion of BSI's claim
for a term of thirty (30) years with the interest being calculated
using the Till rate of the Wall Street Prime Index Rate plus the
Risk Rate (1-3%). The Debtor's Plan proposes to pay BSI's claim at
4.5%.
The SBA's EIDL will be paid in full in accordance with the terms of
the original loan agreement. General unsecured creditors are
classified in Class 4 and will receive a distribution of 100%
percent on the dollar on their allowed claims in cash within ninety
(90) days beginning after the entry of the order confirming the
Plan.
Class 4 consists of general unsecured claims and will be paid in
full. On or before the Effective Date the Debtor shall make one
lump sum payment in cash, in full and final satisfaction of the
general unsecured claims. Class 4 is Unimpaired, and the Holder of
the Class 4 Claims are conclusively presumed to have accepted the
Plan pursuant to Bankruptcy Code §1126(f).
The Plan shall be funded by a capital contribution from the
Debtor's Principal, Pamela Lee. The capital contribution will be
for an amount sufficient to pay Orange County's Real Property Tax
Lien in full and satisfy the Class 3 general unsecured claims. The
Debtor will use its rental income to make its scheduled monthly
mortgage payments to BSI's Class 2 claim.
A full-text copy of the Disclosure Statement dated April 5, 2022,
is available at https://bit.ly/3Kzng32 from PacerMonitor.com at no
charge.
Attorney for Debtor:
James J. Rufo, Esq.
The Law Office of James J. Rufo
1133 Westchester Avenues, Suite N-202
White Plains, NY 10604
(914) 600-7161
jrufo@jamesrufolaw.com
About 6 Turtle Knoll, LLC
6 Turtle Knoll, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No.22
35095) on Feb. 22, 2022. At the time of filing, the Debtor
estimated $100,001 to $500,000 in assets and $500,001 to $1 million
in liabilities. James J. Rufo, Esq. at The Law Office of James J.
Rufo represents the Debtor as counsel.
A.B.C. OF NORTH: Case Summary & Four Unsecured Creditors
--------------------------------------------------------
Debtor: A.B.C. of North Palm Beach, Inc.
775 North Lake Blvd.
Palm Beach Gardens, FL 33410
Chapter 11 Petition Date: April 10, 2022
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 22-12797
Judge: Hon. Mindy A. Mora
Debtor's Counsel: Mark S. Roher, Esq.
LAW OFFICE OF MARK S. ROHER, P.A.
1806 N. Flamingo Road
Suite 300
Pembroke Pines, FL 33028
Tel: (954) 353-2200
E-mail: mroher@markroherlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $0 to $50,000
The petition was signed by My Tran as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/KX54B7I/ABC_of_North_Palm_Beach_Inc__flsbke-22-12797__0001.0.pdf?mcid=tGE4TAMA
ALDERBRIDGE WAY: Gets Initial CAA Stay Order; A&M as Monitor
------------------------------------------------------------
Alderbridge Way GP Ltd., 0989705 B.C. Ltd., and Alderbridge Way
Limited Partnership ("Alderbridge"), were granted an initial order
to commence proceedings under the Companies' Creditors Arrangement
Act. Pursuant to the Initial Order, Alvarez & Marsal Canada Inc.
was appointed as monitor in the CCAA Proceedings.
The Initial Order granted a stay of proceedings until April 11,
2022, and provided that the during the Stay Period, no proceedings
may be commenced against or in respect of Alderbridge.
The Companies are authorized and empowered to obtain and borrow
under a credit facility from Gatland Development Corporation, REV
Investments Inc. and South Street (Alderbridge) Limited Partnership
in order to finance the continuation of the Business and
preservation of the property, provided that borrows under such
credit facility will not exceed $850,000 unless permitted by
further order the Court.
Further information regarding the CCAA proceedings, initial order,
the petition, affidavits, notices of application, reports of the
monitor and all other court-filed documents and notices are
available on the monitor's website at
http://www.alvarezandmarsal.com/alderbridge.
Monitor can be reached at:
Fasken Martineau DuMoulin LLP
Attn: Kibben Jackson
Mishaal Gill
550 Burrard St #2900
Vancouver, BC V6C 0A3
Tel: (604) 631-4766
Email: kjackson@fasken.com
mgill@fasken.com
svolkow@fasken.com
Alvarez & Marsal Canada Inc.
Cathedral Place Building
925 West Georgia Street, Suite 902
Vancouver, BC V6C 3L2
Tel.: (604) 639-0849
Email: atillman@alvarezandmarsal.com
pinky.law@alvarezandmarsal.com
Counsel for the Debtors:
Dentons Canada LLP
Attn: John Sandrelli
Tevia Jeffries
Valerie Cross
Emma Newbery
20th Floor - 250 Howe Street
Vancouver, BC V6C 3R8
Tel: (604) 687-4460
Fax : (604) 683-5214
E-mail: john.sandrelli@dentons.com
tevia.jeffries@dentons.com
valerie.cross@dentons.com
emma.newbery@dentons.com
avic.arenas@dentons.com
lee.ngo@dentons.com
Alderbridge Way GP Ltd is the developer of Atmosphere, a stalled
mixed-use development at Alderbridge Way and No. 3 Road opposite
Lansdowne Centre.
AMS INC: S&P Raises 2022 Revenue Bonds Long-Term Rating to 'BB+
---------------------------------------------------------------
S&P Global Ratings raised its long-term rating on Academies of Math
and Science Inc. (AMS), Ariz.'s outstanding debt to 'BB+' from
'BB'. In addition, S&P assigned its 'BB+' long-term rating to the
Arizona Industrial Development Authority's series 2022 education
revenue bonds, issued for the Academies of Math and Science. The
outlook is stable.
"The upgrade reflects our opinion of the school's strengthened
enrollment and demand profile," said S&P Global Ratings credit
analyst Amber Schafer. "It further reflects our opinion of improved
operating results, MADS, and liquidity," she added.
Proceeds from the series 2022 bonds will be used to finance an
addition to the AMS South Mountain Campus and improvements to the
AMS Prince Campus, refinance the cost of acquiring, renovating, and
equipping an office building, and fund other capital requirements,
a debt service revenue fund, and costs of issuance.
ANGEL'S SQUARE: April 27 Plan Confirmation Hearing Set
------------------------------------------------------
On March 30, 2022, the U.S. Bankruptcy Court for the Southern
District of Florida conducted a hearing to consider approval of the
Second Amended Disclosure Statement filed by Angel's Square, Inc.
On April 5, 2022, Judge Peter D. Russin approved the Second Amended
Disclosure Statement and ordered that:
* April 27, 2022 at 2:30 p.m. in the United States Bankruptcy
Court, 299 E. Broward Blvd. Courtroom 301, Ft. Lauderdale, FL 33301
is the hearing to consider confirmation of the plan.
* April 20, 2022 is fixed as the last day for filing and
serving objections to confirmation of the plan.
* April 20, 2022 is fixed as the last day for filing a ballot
accepting or rejecting the plan.
* April 22, 2022 is the Proponent's deadline for filing
Proponent's Report and confirmation affidavit.
A full-text copy of the order dated April 5, 2022, is available at
https://bit.ly/3JvqdjH from PacerMonitor.com at no charge.
Attorney for Debtor:
Brian S. Behar, Esq.
Behar Gutt & Glazer, P.A.
1855 Griffin Road, Suite A-350
Fort Lauderdale, FL 33004
Tel: (305) 931-3771
Email: bsb@bgglaw.com
About Angel's Square
Fort Lauderdale, Fla.-based Angel's Square, Inc. is a single asset
real estate debtor (as defined in 11 U.S.C. Section 101(51B)).
Angel's Square sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D. Fla. Case No. 21-13576) on April 15, 2021.
Fernando D. Gill, registered agent, signed the petition. In its
petition, the Debtor disclosed total assets of up to $10 million
and total liabilities of up to $1 million. Judge Peter D. Russin
oversees the case. Behar Gutt & Glazer, P.A. is the Debtor's legal
counsel.
ARAS BUSINESS: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Aras Business Group, LLC
5100 Poplar Ave
Ste 2755
Memphis, TN 38137-4000
Business Description: Aras Business Group is an investment company
dedicated to the placement and positioning
of capital in diversified portfolios within
the real estate and mining sectors.
Chapter 11 Petition Date: April 11, 2022
Court: United States Bankruptcy Court
Western District of Tennessee
Case No.: 22-21415
Judge: Hon. Ruthie M. Hagan
Debtor's Counsel: Curtis Johnson, Esq.
JOHNSON AND JOHNSON PC
1407 Union Ave Suite 1002
Memphis, TN 38104
Tel: (901) 725-7520
Email: cjohnson@johnsonandjohnsonattys.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Maria Tolentino as managing member.
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/DCLNYTY/Aras_Business_Group_LLC__tnwbke-22-21415__0001.0.pdf?mcid=tGE4TAMA
BOY SCOUTS OF AMERICA: Final Arguments Start in Bankruptcy Case
---------------------------------------------------------------
The Bharat Express News reports that after a three-week trial, a
Delaware judge began hearing final arguments Wednesday, April 6,
2022, in the Boy Scouts of America bankruptcy case.
Judge Laura Selber Silverstein must decide whether to approve a
reorganization plan that the BSA has negotiated over the past two
years. It would compensate for tens of thousands of men who say
they were sexually abused as children in Scouting, while allowing
Scouting to continue as a permanent business.
The Boy Scouts, based in Irving, Texas, filed for bankruptcy
protection in February 2020 in an effort to end hundreds of
individual lawsuits and create a settlement trust for victims of
abuse.
Although the organization faced 275 lawsuits at the time, more than
82,000 sexual abuse complaints were filed in the bankruptcy
filing.
The reorganization plan calls for the Boy Scouts, its 250 local
councils and certain insurance companies and troop sponsoring
organizations to contribute some $2.6 billion in cash and property
to a compensation fund for victims of abuse.
In return for these contributions and the assignment of insurance
rights to the compensation fund, these contributing parties would
be released from further liability.
The plan faces opposition from several unsettled insurance
companies, as well as the US bankruptcy trustee, who acts as a
watchdog in Chapter 11 cases to ensure compliance with bankruptcy
laws. Insurance companies argue that the procedures for
distributing funds to abuse claimants would violate their rights
under the policies they issued and allow claims to be paid that
would not win damages in civil lawsuits.
The trustee, meanwhile, argued that proposed liability releases for
non-debtor third parties – including local BSA councils, insurers
and troop-sponsoring organizations – violate plaintiffs' due
process rights. of abuse and are not permitted under the bankruptcy
code.
Wednesday's arguments did not address those issues but instead
involved supporters defending the plan as having been developed in
"good faith" and the trust distribution procedures, if any.
Opponents of the plan will present counter-arguments on Thursday.
Lawyers for the Boy Scouts began Wednesday by acknowledging why the
BSA had filed for bankruptcy protection and explaining steps it had
taken to improve child protections.
"It's a tragic part of Scouting's past... Our organization is
deeply sorry," BSA attorney Michael Andolina said of decades of
child sexual abuse.
The Boy Scouts and its supporters argue that the judge must make
several specific findings for the plan to stand. Among them, the
plan was proposed in good faith and the procedures for compensating
the victims provide for a fair and equitable settlement of their
claims. They also ask the judge to find that the proposed starting
claim values for various types of abuse _ ranging from
penetration to abuse without physical contact _ are based on and
consistent with the abuse regulations and litigation results of the
BSA before the bankruptcy.
But Silverstein has repeatedly pushed back against proponents of
the plan, wondering which bankruptcy code provisions would apply to
the conclusions they seek. She noted that she was not being asked
to approve a particular claim settlement, as is often the case in
bankruptcies, and suggested that the arguments of regime supporters
instead involve the settlement of claims, which is a different
question with a different standard of approval.
"There is no right way to resolve 82,000 claims, … but what is
this trust supposed to do … and why do I find it to be
consistent, fair or equitable?" she asked.
Silverstein also questioned whether she could reject the plan if
she believed the BSA’s track record of handling abuse claims was
not fair or appropriate.
"I don't know if any of the settlements the debtors reached in
pre-petition were fair," she said. "…I have no fact to make a
conclusion like that."
Under the plan, the Boy Scouts and its approximately 250 local
councils would contribute up to $786 million in cash and property
and allocate certain insurance rights to the victims’ fund. The
BSA’s two largest insurers, Century Indemnity Co. and The
Hartford, would contribute $800 million and $787 million
respectively, while other insurers have agreed to contribute around
$69 million.
The organization's former biggest troop sponsor, The Church of
Jesus Christ of Latter-day Saints, commonly known as the Mormon
Church, is reportedly paying $250 million for abuse claims
involving the church. Congregations affiliated with The United
Methodist Church agreed to contribute $30 million.
Abuse plaintiffs would also be allowed to sue insurance companies
and local troop-sponsoring organizations, such as churches and
civic groups, that don't make settlements within a year of the law
taking effect. reorganization plan.
As it stands, the compensation fund would total more than $2.6
billion, which would be the largest comprehensive sexual abuse
settlement in US history. The average recovery per plaintiff,
however, would be significantly lower than other sexual abuse
scandal settlements involving large numbers of victims.
About Boy Scouts of America
The Boy Scouts of America -- https://www.scouting.org/ -- is a
federally chartered non-profit corporation under title 36 of the
United States Code. Founded in 1910 and chartered by an act of
Congress in 1916, the BSA's mission is to train youth in
responsible citizenship, character development, and self-reliance
through participation in a wide range of outdoor activities,
educational programs, and, at older age levels, career-oriented
programs in partnership with community organizations. Its national
headquarters is located in Irving, Texas.
The Boy Scouts of America and affiliate Delaware BSA, LLC, sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on
Feb. 18, 2020, to deal with sexual abuse claims.
Boy Scouts of America was estimated to have $1 billion to $10
billion in assets and at least $500 million in liabilities as of
the bankruptcy filing.
The Debtors have tapped Sidley Austin LLP as their bankruptcy
counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel,
and Alvarez & Marsal North America, LLC, as financial advisor. Omni
Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed a tort claimants' committee
and an unsecured creditors' committee on March 5, 2020. The tort
claimants' committee is represented by Pachulski Stang Ziehl &
Jones, LLP, while the unsecured creditors' committee is represented
by Kramer Levin Naftalis & Frankel, LLP.
BOY SCOUTS: Guam Abuse Claimants Balk at Releases of Diocese
------------------------------------------------------------
Vince Sullivan of Law360 reports that the survivors with sex abuse
claims against the Catholic archdiocese on Guam told a Delaware
bankruptcy judge Monday, April 11, 2022, that the proposed Chapter
11 plan of the Boy Scouts of America would extinguish their claims
against the Guamanian church organization via third-party releases
and impact their potential recoveries.
During a third day of closing arguments in the Boy Scouts' Chapter
11 plan confirmation trial, attorneys representing about 70 sex
abuse survivors who have abuse claims against the archbishop of
Agana -- the archdiocese sponsored scouting organizations on the
island -- said the Scouts' plan includes releases and channeling
injunctions that implicate the claims.
About Boy Scouts of America
The Boy Scouts of America -- https://www.scouting.org/ -- is a
federally chartered non-profit corporation under title 36 of the
United States Code. Founded in 1910 and chartered by an act of
Congress in 1916, the BSA's mission is to train youth in
responsible citizenship, character development, and self-reliance
through participation in a wide range of outdoor activities,
educational programs, and, at older age levels, career-oriented
programs in partnership with community organizations. Its national
headquarters is located in Irving, Texas.
The Boy Scouts of America and affiliate Delaware BSA, LLC, sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on
Feb. 18, 2020, to deal with sexual abuse claims.
Boy Scouts of America was estimated to have $1 billion to $10
billion in assets and at least $500 million in liabilities as of
the bankruptcy filing.
The Debtors have tapped Sidley Austin LLP as their bankruptcy
counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel,
and Alvarez & Marsal North America, LLC, as financial advisor. Omni
Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed a tort claimants' committee
and an unsecured creditors' committee on March 5, 2020. The tort
claimants' committee is represented by Pachulski Stang Ziehl &
Jones, LLP, while the unsecured creditors' committee is represented
by Kramer Levin Naftalis & Frankel, LLP.
BRIGHTVIEW LANDSCAPES: S&P Alters Outlook to Neg, Affirms 'B+' ICR
------------------------------------------------------------------
S&P Global Ratings revised its outlook on commercial landscaping
services provider BrightView Landscapes LLC to negative from stable
and affirmed all of its ratings, including the 'B+' issuer credit
rating and the 'BB-' rating on the first-lien credit facilities.
The '2' recovery rating (70%-90%; rounded estimate: 70%) is
unchanged.
The negative rating outlook reflects the risk that BrightView's
adjusted leverage will remain above 5x or free operating cash flow
(FOCF) to debt will fall below 5% on a sustained basis
S&P said, "The negative outlook reflects our expectation that
credit metrics will be weak for the ratings over the next 12-18
months. The refinancing transaction increases the company's total
gross debt. While Brightview has indicated it will use the majority
of the incremental cash to finance future acquisitions, the company
has increased its share repurchase activity in recent quarters, and
we believe the company could continue to use a portion of its cash
flow to fund additional share repurchases. Additionally, we expect
margin pressure from higher labor and material costs will moderate
EBITDA growth resulting in leverage in the 5x-5.5x range at fiscal
year-end 2022, before declining to the 4.5x-5x range in fiscal
2023. We view these metrics as weak for the current rating."
BrightView's operating performance is volatile because it relies on
uncertain weather patterns, including snowfall and rainfall. As of
Dec. 31, 2021, BrightView's S&P Global Ratings-adjusted leverage
was 5.4x, up from about 5.1x a quarter earlier. Unseasonably weak
snowfall in its regions drove the bulk of this increase, as
quarterly snow-removal revenue was down 35% on a year-over-year
basis. Since BrightView performs its snow-removal services off its
existing fixed-cost base, its operating margin for the quarter was
materially affected. Weather-related volatility associated with
high-margin snow-removal services extends to other ancillary
offerings that vary based on rainfall volumes, weather-related
delays, or hurricane clean-up jobs, among other things.
S&P said, "We expect short-term pressure on margins in 2022,
especially on development projects. Most 2022 development projects
have been priced a few months back, and the company has limited
ability to pass through recent labor and materials cost increases
for these projects. As a result, we expect margins will come under
pressure in this segment in the next couple of quarters. We believe
this is a short-term issue, and not a structural decrease in
margins. The company has implemented measures to better escalate
rising costs, including a shorter expiration date for bid windows,
escalation language in bids or shifting from being a just-in-time
buyer to an advanced buyer.
"Despite the fact that Brightview is a publicly traded company, we
continue to believe its financial policy is constrained by its
majority ownership by financial sponsor KKR. Pro forma for
BrightView's repurchase of the remaining shares of common stock
held by MSD Partners, KKR still owns 54% of the company. We also
expect debt leverage has remained elevated, at more than 5x on
average over the next 12-18 months. Still, we expect the company's
leverage and cash flow metrics to be relatively better than most
sponsor-controlled companies, and we expect leverage to improve
below 5x by the end of fiscal 2023."
The negative outlook reflects the risk of a downgrade if
Brightview's adjusted leverage remains above 5x or if FOCF to debt
falls below 5% on a sustained basis.
S&P could lower its rating on BrightView over the next 12 months if
it no longer expect leverage will return sustainably below 5x and
FOCF to debt falls below 5%. A downgrade could occur if:
-- Higher-than-expected labor and materials increases or inability
to pass those on causes a sustained decline in operating margins;
or
-- BrightView's controlling owners prompt the company to undertake
material debt-funded acquisitions, shareholder distributions, or
share buy backs.
S&P could consider a stable outlook if it believe leverage will
improve to and remain below 5x, most likely due contributions from
future acquisitions, sustained demand in landscaping services and
the company's ability to pass on labor and raw materials costs
inflation.
ESG credit indicators: E-2 S-2 G-3
Governance is a moderately negative consideration, as it is for
most rated entities majority-owned by private-equity sponsors. S&P
believes the company's highly leveraged financial risk profile
points to corporate decision-making that prioritizes the interests
of the controlling owners. This also reflects private-equity
sponsors' generally finite holding periods and focus on maximizing
shareholder returns.
BRONZE KINGDOM: Unsecureds to Split $12K in Consensual Plan
-----------------------------------------------------------
The Bronze Kingdom LLC filed with the U.S. Bankruptcy Court for the
Middle District of Florida a Plan of Reorganization dated April 5,
2022.
Debtor is a Foreign Limited Liability company organized under the
laws of the State of Wyoming and authorized to transact business in
Florida since March 27, 2017.
The Debtor operates a restaurant, bar, and event center at its
principal location at premises located at 6464 International Drive,
Orlando, FL 32819; and the Debtor also operates a consignment shop
from premises located at 3201 E. Colonial Dr., Ste. M16, Orlando,
FL 32803.
Class 1 consists of the Secured Claim of Green Capital. This Claim
is secured by liens on the Green Capital Collateral. The Class 1
Secured Claim is approximately $4,859.00 for financial projection
purposes only. To the extent that this Claim is Allowed as a
Secured Claim, then the Holder will: (i) retain the liens securing
the claim to the extent of the allowed amount of the claim; and
(ii) receive on account of such claim deferred cash payments
totaling at least the allowed amount of the claim, of a value, as
of the Effective Date of at least the value of the claimant's
interest in the estate's interest in the property securing the
claim. The Reorganized Debtors shall continue to make regular
contractual payments on the Green Capital Secured Claim in
accordance with the note and security agreement securing said
Claim.
Class 2 consists of the Allowed Unsecured Claims against the
Debtor. This Class is Impaired.
* Consensual Plan Treatment: The liquidation value or amount
that unsecured creditors would receive in a hypothetical chapter 7
case is approximately $0.00. Accordingly, the Debtor proposes to
pay unsecured creditors a pro rata portion of $12,000.00. Payments
will be made in equal quarterly payments totaling $1,000.00.
Payments shall commence on the fifteenth day of the month, on the
first month that begins after the Effective Date and shall continue
quarterly for eleven additional quarters. Pursuant to §1191, the
value to be distributed to unsecured creditors is greater than the
Debtor's projected disposable income to be received in the 3-year
period beginning on the date that the first payment is due under
the plan.
* Nonconsensual Plan Treatment: The liquidation value or
amount that unsecured creditors would receive in a hypothetical
chapter 7 case is approximately $0.00. Accordingly, the Debtor
proposes to pay unsecured creditors a pro rata portion of its
Disposable Income. If the Debtor remains in possession, plan
payments shall include the Subchapter V Trustee's administrative
fee which will be billed hourly at the Subchapter V Trustee's then
current allowable blended rate, which shall not exceed the
Disposable Income. Plan Payments shall commence on the fifteenth
day of the month, on the first month that is after the Effective
Date and shall continue quarterly for eleven additional quarters.
The initial estimated quarterly payment shall be $0.00.
Class 3 consists of any and all equity interests and warrants
currently issued or authorized in the Debtor. This Class is
Unimpaired.
The Plan contemplates that the Reorganized Debtor will continue to
operate the Debtor's business. Except as explicitly set forth in
this Plan, all cash in excess of operating expenses generated from
operation until the Effective Date will be used for Plan Payments
or Plan implementation, cash on hand as of Confirmation shall be
available for Administrative Expenses.
A full-text copy of the Plan of Reorganization dated April 5, 2022,
is available at https://bit.ly/3jw5aTy from PacerMonitor.com at no
charge.
Attorneys for Debtor:
Jeffrey S. Ainsworth, Esquire
Fla. Bar No.: 060769
E-mail: jeff@bransonlaw.com
Jacob D. Flentke, Esquire, of Counsel
Florida Bar No.: 25482
E-mail: jacob@bransonlaw.com
BransonLaw, PLLC
1501 E. Concord Street
Orlando, Florida 32803
Telephone (407) 894-6834
Fax (407) 894-8559
About The Bronze Kingdom
The Bronze Kingdom LLC is a Foreign Limited Liability company
organized under the laws of the State of Wyoming and authorized to
transact business in Florida since March 27, 2017. The Debtor filed
Chapter 11 Petition (Bankr. M.D. Fla. Case No. 22-00040) on January
5, 2022.
The Debtor is represented by Jeffrey S. Ainsworth, Esq. of
BRANSONLAW, PLLC.
CD&R VIALTO: S&P Assigns 'B-' ICR on Acquisition by CD&R
--------------------------------------------------------
S&P Global Ratings assigned its 'B-' issuer credit rating to New
York-based CD&R Vialto UK Intermediate 3 Ltd. (Vialto Partners) and
its 'B-' issue-level and '3' recovery ratings to the first-lien
credit facilities. The second-lien debt will be unrated.
The stable outlook reflects S&P's expectation the company will
smoothly manage its separation, make steady progress delivering on
its transformation goals, and become cash flow positive by the
first half of fiscal year 2024.
Vialto Partners, a leading provider of global mobility solutions,
will be spun off from PricewaterhouseCoopers (PwC) and acquired by
Clayton, Dubilier & Rice. The transaction is expected to close in
the fiscal fourth quarter ending June 30, 2022.
Fiscal 2023 will be a transition year for Vialto, with large
capital outlays in carving-out a scaled global business while
maintaining adequate liquidity. S&P said, "We believe costs to
carve out Vialto's global business from PwC will likely be
extensive. Building out its back-office infrastructure and system
implementations are some areas where we expect the company to incur
significant expenses in the coming year. As a result, we forecast
$65 million-$85 million in free operating cash flow (FOCF) deficits
through fiscal 2023 (ending June 2023). We expect the company will
have adequate liquidity at transaction close, with about $100
million of cash and an undrawn $200 million revolving credit
facility to support cash flow shortfall. We expect FOCF to turn
positive in fiscal 2024 as transition costs reduce and synergies
realized."
While revenues were slow to recover from the pandemic, they remain
highly recurring and provide near term visibility. Approximately
85% of revenue is derived from individual tax returns, compliance,
and consulting services with a significant portion tied to the
annual tax process. Year to date, Vialto's tax initiation volume
has recovered to pre-pandemic levels, which is expected to drive
positive momentum in fiscal 2023. Despite the tax return market
growing only 1%, S&P believes Vialto could achieve higher growth.
S&P's base case assumes 1%-3% revenue growth in 2022 and 4%-7% in
2023 as tax volumes normalize and Vialto realizes revenue synergies
through upselling adjacent services. Still, it remains unclear if
the COVID-19 pandemic could have impaired long term corporate
overseas assignments as enterprises shrink their office footprints
and adopt workplace flexibly.
S&P said, "We believe the separation from PwC could unlock revenue
opportunities, however near-term business execution risks are high.
Without the backing of the widely recognized PwC brand, we believe
there are potential risks relating to Vialto's ability to win new
customers and to operate as a stand-alone entity. We think the
company could soundly navigate these risks if it effectively
manages client relationships by retaining key personnel. In the
medium term, we think forced client attrition under the "federated
model" with PwC should lessen, allowing better customer retention
rates for Vialto and helping it win new customers. The company has
identified about incremental workforce tax revenue from potential
PwC clients and plans to further invest toward building a unified
technology platform.
"The stable outlook reflects our expectation the company will
effectively manage its separation, make steady progress delivering
on its transformation goals, grow revenues 4%-6%, and become free
cash flow positive by the first half of fiscal year 2024."
S&P could lower its rating over the next 12 months if it views the
capital structure as unsustainable or expect a significant decline
in the company's liquidity position. This could occur if:
-- The company experiences material client attrition resulting in
lower tax initiation volumes;
-- Execution challenges result in service disruptions or cost
overruns; or
-- Revolver borrowing exceed 40% of the commitment with limited
visibly in repayment.
While unlikely over the next 12 months, S&P could raise its rating
if the carve-out is executed ahead of plan and the company
demonstrates it can successfully operate as a stand-alone entity
and realize expected revenue and cost synergies. For an upgrade, we
would need to see:
-- A demonstrated ability to win new workforce mobility tax
customers and upsell adjacent services; and
-- Leverage sustained below 6.5x and FOCF to debt above 5% from
EBITDA expansion.
Environmental, Social, And Governance
ESG credit indicators: E-2, S-2, G-3
Governance is a moderately negative consideration, as it is for
most rated entities owned by private equity sponsors. S&P believes
the company's highly leveraged financial risk profile points to
corporate decision-making that prioritizes the interests of the
controlling owners. This also reflects private equity sponsors'
generally finite holding periods and focus on maximizing
shareholder returns. Social risks include Vialto's responsibly to
manage sensitive consumer financial data. Under PwC, the tax
mobility business has not experienced a cyber security breach.
Shortly following the separation from PwC, Vialto plans to create
and implement a similar ESG framework.
CDK GLOBAL: S&P Places 'BB+' Long-Term ICR on CreditWatch Negative
------------------------------------------------------------------
S&P Global Ratings placed its 'BB+' long-term issuer credit rating
on Hoffman Estates, Ill.-based auto dealer information technology
(IT) solutions provider CDK Global Inc. on CreditWatch with
negative implications.
S&P said, "The CreditWatch placement reflects our view that the
company's credit profile will deteriorate due to the anticipated
increase in its debt following the transaction. We expect to
resolve the CreditWatch once we complete a detailed review of CDK's
proposed capital structure and business prospects."
CDK Global announced that it has entered into a definitive
agreement to be acquired by Brookfield Business Partners and a
group of its institutional partners for a total enterprise value of
$8.3 billion.
S&P said, "The CreditWatch negative placement reflects the elevated
likelihood that we will lower our long-term issuer credit rating on
CDK by more than one notch following the close of its acquisition
by Brookfield because we believe the debt it will take on in
conjunction with the transaction will lead to a substantial
increase in its leverage and reduced cash flow. The company's S&P
Global Ratings-adjusted leverage was in the low- to mid-3x area as
of Dec. 31, 2021, and it generated free operating cash flow of
roughly $267 million during the 12 months ended Dec. 31, 2021."
CHARMING CHARLIE: Reaches Tentative WARN Suit Settlement
--------------------------------------------------------
Leslie A. Pappas of Law360 reports that bankrupt women's accessory
retailer Charming Charlie has reached a tentative settlement with
former employees who sued for allegedly being terminated in July
2019 without proper notice, with the company agreeing to turn over
25% of whatever it wins in future avoidance actions.
In a joint court filing late Wednesday, April 6, 2022,debtor
Charming Charlie Holdings Inc. and plaintiff Lauren Wilrich sought
the bankruptcy court's preliminary approval of their settlement
agreement, which would release all parties and resolve the putative
class action she filed against the retailer on July 23, 2019.
About Charming Charlie
Charming Charlie -- http://www.CharmingCharlie.com/-- is a
Houston-based specialty retailer focused on fashion jewelry,
handbags, apparel, gifts and beauty products. The Company
currently operates more than 375 stores in the United States and
Canada.
Charming Charlie Holdings Inc. and its affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 17-12906) on Dec. 11,
2017.
Charming Charlie estimated assets of $50 million to $100 million
and debt of $100 million to $500 million.
Kirkland & Ellis LLP is serving as the Company's legal counsel,
AlixPartners LLP is serving as its restructuring advisor, and
Guggenheim Securities, LLC is serving as its investment banker.
Klehr Harrison Harvey Branzburg LLP is the Company's local counsel.
Rust Consulting/OMNI Bankruptcy is the claims and noticing agent.
Joele Frank, Wilkinson Brimmer Katcher is the Company's
communications consultant. A&G Realty Partners, LLC's the
Company's real estate advisors. Hilco Merchant Resources LLC is the
Company's exclusive agent.
CITE LLC: Wins Cash Collateral Access Thru April 30
---------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized Robert Handler, the Trustee of Cite
LLC to use the cash collateral of A. Robert Abboud and Company in
accordance with the budget, with a 10% variance through April 30,
2022.
As adequate protection for the Debtor's use of cash collateral,
ARACO and Republic Bank are granted post-petition liens, security
interests and mortgages in and on the property of the Debtor and
its estate, including all property acquired by the Debtor or its
estate after the Petition Date, to the same extent, validity,
perfection, enforceability, and priority of the liens, security
interests, and mortgages of such Secured Creditor in the
Pre-petition Collateral as of the Petition Date.
If and to the extent the adequate protection of the interests of
the Secured Creditors, or either of them, in the Post-petition
Collateral pursuant to the order proves insufficient, such Secured
Creditor(s) will be granted an administrative expense claim under
section 507(b) of the Bankruptcy Code.
As further adequate protection, the Trustee will make the adequate
protection payments to the Secured Creditors indicated in the
Budget, in the amounts of $14,000 per month to Republic Bank and
$7,500 per month to ARACO, with the March adequate protection
payments to be received by the Secured Creditors by no later than
April 25, 2022.
A continued hearing on the matter is scheduled for April 27 at 10
a.m. via Zoom for Government.
A copy of the order and the Debtor's budget for April 2022 is
available at https://bit.ly/371zTFu from PacerMonitor.com.
The Debtor projects $335,000 in total income and $114,933 in total
expenses.
About Cite LLC
Cite LLC, an American restaurant business, filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
N.D. Ill. Case No. 21-13730) on Dec. 3, 2021. In the petition
signed by Evangeline Gouletas, managing member, the Debtor
disclosed $5,517,547 in total assets and $7,945,223 in total
liabilities.
Judge Janet S. Baer oversees the case.
The Golding Law Offices, PC serves as the Debtor's counsel.
CONTINENTAL COUNTRY CLUB: Wins Cash Collateral Access
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona authorized
Continental Country Club, Inc. to use cash collateral on an interim
basis in accordance with the budget, with a 10% variance through
June 30, 2022.
The Court held that the terms of the prior orders will remain in
effect except as modified by the Sixth Agreed Order Granting
Debtor's Motion for Authority to Use Cash Collateral.
The First Order authorized the Association and Sunwest to extend
the Debtor's cash collateral access by agreement and without
further notice or hearings.
Thereafter, the parties agreed to the entry of a series of agreed
orders that have served to extend the Debtor's use of cash
collateral to and through March 31, 2022.
A copy of the order and the Debtor's budget for the period from
April to June 2022 is available at https://bit.ly/3LQEZmE from
PacerMonitor.com.
The Debtor projects $152,200 in total cash received and $309,003 in
total cash disbursed.
About Continental Country Club
Continental Country Club filed a Chapter 11 bankruptcy petition
(Bankr. D. Ariz. Case No. 21-00956) on Feb. 9, 2021. At the time
of filing, the Debtor listed as much as $10 million in both assets
and liabilities.
Judge Edward P. Ballinger Jr. oversees the case.
The Debtor tapped Engelman Berger, P.C. as its bankruptcy counsel,
and Krupnik & Speas, PLLC and Warner Angle Hallam Jackson &
Formanek PLC as its special counsel.
ECTOR COUNTY ENERGY: Case Summary & 20 Largest Unsecured Creditors
------------------------------------------------------------------
Debtor: Ector County Energy Center LLC
8200 OB Holt Road
Goldsmith, TX 79741
Business Description: The Debtor is in the business of owning and
operating a 330 MW natural gas-fired
electricity-generating facility located on
32.5 acres of Debtor-owned land in Ector
County, Texas, just outside of Odessa, that
is part of the Permian Basin.
Chapter 11 Petition Date: April 11, 2022
Court: United States Bankruptcy Court
District of Delaware
Case No.: 22-10320
Debtor's
General
Counsel: John J. Monaghan, Esq.
Lynne B. Xerras, Esq.
Kathleen M. St. John, Esq.
HOLLAND & KNIGHT LLP
10 St. James Avenue
Boston, MA 02116
Tel: 617-523-2700
Fax: 617-523-6850
Email: bos-bankruptcy@hklaw.com
- and -
David W. Wirt, Esq.
Phillip W. Nelson, Esq.
150 N. Riverside Plaza, Suite 2700
Chicago, IL 60606
Tel: 312-263-3600
Fax: 312-578-6666
Email: david.wirt@hklaw.com
phillip.nelson@hklaw.com
Debtor's
Local Counsel: Christopher A. Ward, Esq.
Michael V. DiPietro, Esq.
POLSINELLI PC
222 Delaware Avenue
Suite 1101
Wilmington, DE 19801
Tel: 302-252-0920
Fax: 302-252-0921
Email: cward@polsinelli.com
mdipietro@polsinelli.com
Debtor's
Special
Litigation
Counsel: LOCKE LORD, LLP
Debtor's
Special
Litigation
Counsel: CROWELL & MORING LLP
Debtor's
Investment
Banker: PERELLA WEINBERG PARTNERS LP AND
TUDOR, PICKERING, HOLT & CO.
Debtor's
Claims &
Noticing
Agent: DONLIN RECANO & COMPANY INC.
Debtor's
Restructuring
Advisor: GRANT THORNTON LLP
Estimated Assets: $50 million to $100 million
Estimated Liabilities: $500 million to $1 billion
The petition was signed by John D. Baumgartner as chief
restructuring officer.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/VYS4SWY/Ector_County_Energy_Center_LLC__debke-22-10320__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Direct Energy Business Litigation $396,000,000
Marketing LLC
Quinn Emanuel Urquhart &
Sullivan, LLP
51 Madison Avenue
New York NY 10010
Christopher D. Kercher, Esq.
Tel: (212) 849-7000
Fax: (212) 849-7100
Email: christopherkercher@quinnemanuel.com
2. Controlled Fluids, Inc. Trade Payable $58,928
PO Box 22859
Beaumont TX 77720-2859
Tel: (800) 722-2630
Email: isales@confluids.com
3. General Electric Trade Payable $53,060
International, Inc.
GE Power Generation Services
4200 Wildwood Parkway
Atlanta GA 30339
Attn: Region General Manager
Email: maudette.richards@ge.com
Tel: (360) 633 - 5110
4. Public Utility Trade Payable $51,206
Commission of Texas
William B. Travis Bldg.
1701 N. Congress Ave 7th Fl
Austin TX 78701
Taylor Kilroy
Tel: (512) 936-7000
Email: taylor.kilroy@puc.texas.gov
5. Advanced Turbine Support Trade Payable $22,016
6280 SW 103 Rd Street
Gainesville FL 32608
Chris McGinley
Tel: (352) 231-5284
Email: cmcginley@advancedturbinesupport.com
6. AON Risk Services Trade Payable $20,966
Central, Inc.
200 E Randolph
12th Floor
Chicago IL 60601
Tel: (312) 381-1000
7. Longhorn Insulation, Inc. Trade Payable $18,400
PO Box 70440
Odessa TX 79769
Roger Montemayor
Tel: 432-934-6499
Email: roger@longhorninsulation.com
8. A2/Falls on Bull Creek, LLC MDL Litigation Undetermined
Hillard Martinez Gonzalez LLP
719 S. Shoreline Blvd.
Corpus Christi TX 78401
Michael E. Richardson, Esq.
Tel: (361) 882-1612
Email: mrichardson@hmglawfirm.com
9. Butler, Barbara MDL Litigation Undetermined
The Manginello Law Firm, PLLC
1776 Yorktown
Ste. 450
Houston TX 77056
Ralph P. Manginello, Esq.
Tel: (713) 528-9070
Email: ralph@atty911.com
10. Edward Restoration, LLC etc. MDL Litigation Undetermined
Skelton Slusher Barnhill pllc
1616 S Chestnut St.
Lufkin TX 75901
Scott C. Skelton, Esq.
Tel: (936) 632-2300
Email: skelton@skeltonlusher.com
11. Electric Reliability Default Undetermined
Council of Texas, Inc. Uplift
7620 Metro Center Drive Charge
Austin TX 78744-1654
Attn: Legal Department -
Chad V. Seely
Email: chad.seely@ercot.com
12. Jaehne, August Individually MDL Litigation Undetermined
etc. et al.
Arnold & Itkin
6009 Memorial Drive
Houston TX 77007
Jason A. Itkin, Esq.
Tel: (855) 969-3759
Email: jitkin@arnolditkin.com;
e-service@arnolditkin.com
13. Jamerson, Diane etc. et al. MDL Litigation Undetermined
Rad Law Firm
8001 Lyndon B. Johnson Fwy
Suite 300
Dallas TX 75251
Daryoush Toofanian, Esq.
Email: dtoofanian@radlawfirm.com;
e-serve: efileDT@radlawfirm.com
Tel: (800) 710-8079
14. Jones, Ambrea and MDL Litigation Undetermined
Timothy Jones, Jr. etc. et al.
Spagnoletti Law Firm
401 Louisiana St
Eighth Fl
Houston TX 77022
Francis Spagnoletti Esq
Tel: (713) 653-5600
Email: frank@spaglaw.com
15. Meza, Colinda MDL Litigation Undetermined
Individually etc., et al.
Guerrero & Whittle, PLLC
2630 Exposition Blvd.
Suite 102
Austin TX 78703
Mary Whittle, Esq.
Tel: (512) 605-2300
Email: mary@gwjustice.com
16. Segundo, Amanda and MDL Litigation Undetermined
Andrew Segundo et al etc.
Buzbee Law Firm
600 Travis St.
Ste. 7300
Houston TX 77002
Anthony G. Buzbee, Esq.
Tel: (844) 349-9196
Email: tbuzbee@txattorneys.com
17. Simmons, Carina Individually MDL Litigation Undetermined
etc. et al.
Fears Nachawati PLLC
5473 Blair Ad.
Dallas TX 75231
Gibbs C Henderson Esq.
Tel: (866) 705-7584
Email: ghenderson@fnlawfirm.com
18. Trujillo, Christopher, MDL Litigation Undetermined
etc. et al.
Mostyn Law
3810 W. Alabama St.
Houston TX 77027
Gregory F. Fox, Esq.
Tel: (713) 714-0000
Email: gfcdocketefile@mostynlaw.com
19. Turner, Randy, MDL Litigation Undetermined
Individually and
as Personal
Representative
etc., et al.
Brent Coon & Associates
300 Fannin
Suite 200
Houston TX 77002
Brent Coon, Esq.
Tel: (713) 225-1682
Email: brent@bcoonlaw.com
20. White, Robert et al. MDL Litigation Undetermined
Brent Coon & Associates
300 Fannin
Suite 200
Houston TX 77002
Brent Coon, Esq.
Tel: (713) 225-1682
Email: brent@bcoonlaw.com
ECTOR COUNTY: Seeks Cash Collateral Access Thru May 1
-----------------------------------------------------
Ector County Energy Center LLC asks the U.S. Bankruptcy Court for
the District of Delaware for authority to, among other things, use
cash collateral in which the prepetition secured lenders, through
Credit Suisse AG, Cayman Islands, as administrative agent and as
collateral agent, holds an interest on their collective behalf.
The Debtor seeks to use $1,152,033 on an interim basis through the
week of May 1, 2022.
The Debtor believes that, as of the Petition Date, no party other
than the Prepetition Secured Lenders asserts a secured interest in
the cash collateral. The Debtor has negotiated the terms of the
Interim Order, and has been informed that the Prepetition Secured
Lenders will support entry of the Interim Order and the Final Order
on a consensual basis.
At the time of the February 2021 Winter Storm Uri, ECEC was party
to a heat rate call option which provided for the HRCO
counterparty, Direct Energy Business Marketing, LLC, to pay a
monthly premium to ECEC for the right to call on ECEC to produce
energy and various quantities of ancillary services. For several
days during Winter Storm Uri, ECEC was unable to procure natural
gas needed to power its turbines when production systems that fed
into the gas pipelines froze, effectively preventing the Debtor
from dispatching power at a time of extreme demand. Those
unprecedented factors resulted in ECEC being unable to deliver
power or ancillary services when called for by Direct Energy,
ultimately leading to the purported termination of the HRCO in May
2021, when Direct Energy disputed ECEC's assertion of a force
majeure event. That termination led to Direct Energy commencing
litigation in the New York Supreme Court asserting a claim for
damages in excess of $400 million, of which $393 million was
alleged to be owed for the month of February 2021. Additional
litigation arising from the impact of Winter Storm Uri was brought
against ECEC and other utilities and market participants. ECEC has
been named as a defendant in approximately 113 personal injury
and/or property damage tort claims currently pending in the Texas
state court system.
Given the apparent current market interest in Electric Reliability
Council of Texas energy production assets, and the continuing
expense and distraction arising from Winter Storm Uri and its
fallout, ECEC determined that a concerted sale effort represented
the best option to maximize and realize the Debtor's going-concern
value for the benefit of the Debtor and its creditors. The Debtor
also concluded that, as a practical matter, maximizing value also
turned on affording a purchaser the comfort that it would receive
title to the Power Plant free and clear of liens, claims, and
interests which is attainable only through a sale under section 363
of the Bankruptcy Code. With a stalking horse bid having been
accepted following a period of substantial marketing efforts led by
the Debtor's professionals, the Chapter 11 case has been filed to
achieve those results. To that end, the Debtor has concurrently
filed a motion seeking approval of bid procedures relating to
post-petition solicitation of overbids to a $91,250,000 stalking
horse bid and approval of a sale to the highest and best bidder
identified in that solicitation process.
In order to get to a closing of that transaction, ECEC requires the
use of cash and cash equivalents subject to liens held by the Agent
for the benefit of the Prepetition Secured Lenders under the Credit
Agreement.
Pursuant to (a) the Amended and Restated Credit and Guaranty
Agreement, dated as of August 22, 2019, by and among Invenergy
Thermal Operating I LLC, as borrower, the Debtor and certain of its
non-debtor affiliates, as Subsidiary Guarantors, each of the banks
and other financial institutions party thereto as Lenders, the
financial institutions from time to time parties thereto as issuing
banks in respect of Revolving Letters of Credit, the Agent, and (b)
the other Loan Documents, pursuant to which the Prepetition Secured
Lenders agreed to provide term loans and revolving loans to, and
for the account of, ITOI.
In particular, in addition to amending the terms of a $350 million
term loan that had previously funded under the Original Credit
Agreement as restated through the Credit Agreement, certain of the
Prepetition Secured Lenders agreed to fund an Incremental Term Loan
in the amount of $75 million, and a Revolving Loan in the amount of
up to $70 million, inclusive of amounts available to fund the
Revolving Letters of Credit, on behalf of ITOI or its operating
subsidiaries. In addition to the issuance of letters of credit to
provide credit support for ITOI and its subsidiaries, the proceeds
of the Revolving Loan were made generally available to fund the
working capital requirements of ECEC, as well as the operations of
Credit Agreement co-guarantors Invenergy Nelson LLC and Grays
Harbor Energy LLC, for project maintenance and capital
expenditures, and other general corporate purposes.
Among the letters of credit funded through proceeds of the
Revolving Loan is a $7 million standby letter of credit posted by
the Debtor in connection with the HRCO in favor of Direct Energy.
The HRCO LC has been cash-collateralized and is secured by a $7.2
million deposit held on account with ECEC. In addition, a $225,000
letter of credit in favor of OneOK has been cash collateralized by
a $230,625 cash collateral deposit held by ECEC.
As of the Petition Date, the principal balance of approximately
$337,319,921 was outstanding under the Term Loans, and Revolving
Letters of Credit totaling of approximately $64,553,598 were issued
and outstanding, exclusive of fees, interest, and other costs to
which the Prepetition Secured Lenders are entitled pursuant to the
Prepetition Loan Documents.
As adequate protection, the Prepetition Lenders will be granted a
lien on the Debtor's post-petition assets and superpriority claims
to the same extent and with the same priority as was held by the
Term Lenders and the Revolving Lenders, as applicable, in the
Debtor's prepetition assets as of the commencement of the Chapter
11 Case, provided that the DIP Claims will be senior in right of
payment and lien priority to the Adequate Protection Claims in
respect of the third priority Remaining Term Lender Claims, but
junior in right of payment and lien priority to the Adequate
Protection Claims in respect of the First Priority Base
Distribution and Revolving Lender Claims.
The Debtor will pay the reasonable fees and expenses of the Agent
and the Ad Hoc Group,
including fees and expenses of counsel (but limited to Davis Polk &
Wardwell LLP and Richards Layton & Finger, P.A.) in connection with
the Chapter 11 Case. For the avoidance of doubt, the payments will
not be characterized as principal or applied to reduce the
principal amount of the obligations under the Credit Agreement.
In the event of a default under the DIP Financing, which triggers a
termination of the Prepetition Secured Lenders' consent to the
Debtor's use of Cash Collateral, the Prepetition Secured Lenders
have agreed to, and the Interim Order provides for, a carveout in
an amount equal to the sum of (i) all fees
required to be paid to the Court and United States Trustee, plus
interest at the statutory rate, (ii) all reasonable fees incurred
by a chapter 7 trustee under section 726(b) of the Bankruptcy Code
in an amount not to exceed $50,000, (iii) to the extent allowed at
any time, whether by interim or final compensation order,
procedural order, or any other order of the Bankruptcy Court, all
unpaid fees, costs, and expenses -- Carve-Out Professional Fees --
incurred or accrued by persons or firms retained by the Debtor
pursuant to section 327, 328 or 363 of the Bankruptcy Code and any
official committee that may be appointed in the Chapter 11 Case
pursuant to section 1103 of the Bankruptcy Code at any time before
or on the first business day following delivery by the Agent
(acting at the direction of the Requisite Consenting Lenders) to
the Debtor of the occurrence of a default, plus (iv) Allowed
Professional Fees of Professional Persons incurred after the first
business day following delivery of that notice in an aggregate
amount, to the extent allowed at any time, whether by interim or
final compensation order, procedural order, or any other order of
the Bankruptcy Court, not to exceed $1 million, plus any in a
success fee earned by the Debtor's investment banker. Except for
the success fee earned by the Debtor's investment banker, no
success, completion or similar fees shall be payable from the
Carve-Out.
In addition, the Prepetition Secured Lenders have agreed that, even
if the Prepetition Secured Lenders'
consent to use of cash collateral use is not terminated, from the
proceeds of a sale of substantially all of the Debtor's assets,
after the Prepetition Secured Lenders receive $55 million from the
proceeds, the UST Fees, all fees and expenses of all Professional
Persons and all allowed priority claims may be paid, up to $5
million may be paid to satisfy the holder of the DIP Financing
debt, $5 million may be allocated and distributed to holders of
general unsecured claims, and up to an additional $5 million may be
allocated to and used for post-plan effective date administration
of the Chapter 11 case.
The DIP Lenders require the Debtor to meet these milestones:
-- On the Petition Date, the Debtor must file the DIP Motion
and Cash Collateral Stipulation
-- 3 Business Days following the first hearing in the Chapter
11 Case, the Court must have entered the Interim DIP Order and
Interim Cash Collateral Order
-- Petition Date + 10 days, the the Debtor must file the
Bidding Procedures Motion
-- Petition Date + 30 days, the Bankruptcy Court must enter
the Final DIP Order and Final Cash Collateral Order
-- Petition Date + 35 days, the Bankruptcy Court must approve
the Bidding Procedures and enter the
Bidding Procedures Order
-- Petition Date + 60 days, the Debtor must file the Plan and
Disclosure Statement
-- Petition Date + 70 days at 11:59 p.m. (Eastern Time), the
Deadline for submitting Qualified Bids
-- Petition Date + 75 days, the Auction must be held
-- Petition Date + 80 days, the Bankruptcy Court must approve
and enter the Sale Order
-- Petition Date + 90 days, the Company must file an Amended
Disclosure Statement if necessary
-- Petition Date + 120 days, the Bankruptcy Court must approve
the Disclosure Statement
-- Petition Date + 155 days, the Sale Transaction must close
-- Petition Date + 160 days, the the Confirmation Hearing must
commence
-- Petition Date + 175 days, the Bankruptcy Court must approve
and enter the Confirmation Order
-- Petition Date + 190 days, the Plan Effective Date must
occur
The Sale Closing and subsequent Plan confirmation process may be
extended by 60 days in the event of a default by the Winning Bidder
and to pursue a closing with a back-up bidder.
A copy of the motion and the Debtor's budget for the period from
April 1 to July 31, 2022 is available at https://bit.ly/3LUiqxy
from PacerMonitor.com.
The Debtor projects $3,243,915 in total receipts and $3,335,00 in
total operating disbursements.
Counsel to the DIP Agent and the Ad Hoc Group:
Brian Resnick, Esq.
Joshua Sturm, Esq.
Davis Polk & Wardwell LLP
450 Lexington Avenue
New York, NY 10017
E-mail: brian.resnick@davispolk.com
joshua.sturm@davispolk.com
- and -
Mark D. Collins, Esq.
Richards, Layton & Finger P.A.
E-mail: collins@rlf.com
About Ector County Energy Center LLC
Ector County Energy Center LLC is in the business of owning and
operating a 330 MW natural gas-fired electricity-generating
facility located on 32.5 acres of Debtor-owned land in Ector
County, Texas, just outside of Odessa, that is part of the Permian
Basin. The Debtor dispatches energy generated by its two natural
gas fueled simple-cycle combustion turbines and related balance of
plant equipment, all designed to enable the Power Plant to generate
energy and respond quickly at times when demand is "peaking" and
the market requires additional power supply.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 22-10320) on April 11,
2022. In the petition signed by John D. Baumgartner, chief
restructuring officer, the Debtor disclosed up to $100 million in
assets and up to $1 billion in liabilities.
Christopher A. Ward, Esq., at Polsinelli PC oversees the case.
Counsel to Credit Suisse AG, Cayman Islands, as administrative
agent and as collateral agent, and the Ad Hoc Group are Davis Polk
& Wardwell LLP, led by Brian Resnick, Esq. and Joshua Sturm, Esq.;
and Richards, Layton & Finger P.A., led by Mark D. Collins, Esq.
EL MONTE NATURE: Case Summary & 13 Unsecured Creditors
------------------------------------------------------
Debtor: El Monte Nature Preserve, LLC
f/k/a El Capitan Golf Club, LLC
1335 San Lucas Court
Sonala Beach, CA 92075
Business Description: El Monte Nature is a Single Asset Real
Estate debtor (as defined in 11 U.S.C.
Section 101(51B)). The Debtor is the fee
simple owner of approx. 485 acres of
land in Lakeside, California zoned for
sand mining valued at $45 million.
Chapter 11 Petition Date: April 12, 2022
Court: United States Bankruptcy Court
Southern District of California
Case No.: 22-00971
Debtor's Counsel: Michael D. Breslauer, Esq.
SOLOMON WARD SEIDENWURM & SMITH LLP
401 B Street, Suite 1200
San Diego, CA 92101-4295
Tel: 619-231-0303
E-mail: mbreslauer@swsslaw.com
Total Assets: $45,128,183
Total Liabilities: $39,540,834
The petition was signed by William B. Adams as manager.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/SQJWKKY/El_Monte_Nature_Preserve_LLC__casbke-22-00971__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 13 Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. HH&H Investors LLC Tech Report & $2,824,938
9710 Traville completion of
Gateway Drive EIR
Rockville, MD 20851
2. ESK Enterprises LLC Repayment of $1,345,236
5833 S. Paris Court loans
Englewood, CO 80111
3. West Coast Sand & Gravel Repayment of $562,815
P.O. Box 5267 loan
Buena Park, CA 90620
4. ESA Consulting $531,589
West C Street, Suite 750 work on E/R
San Diego, CA 92101
5. Steen & Associates Consulting on EIR $70,825
8580 La Mesa Blvd.
Suite 102
La Mesa, CA 91942
6. Jon Ammon Repayment of Loan $59,769
2877 Firebrand Drive
Alpine, CA 91901
7. Steve Hall $54,992
P.O. Box 675148
Rancho Santa Fe, CA 92067
8. Marc Brown Tax Returns, $15,000
1990 Old Town Ave, accounting &
Ste. A206 start up
San Diego, CA 92110
9. Avid Tax work on property $10,418
3200 4th Ave, Suite taxes
101A
San Diego, CA 92103
10. AECOM Consulting on EIR $5,622
401 West A Street,
Suite 1200
San Diego, CA 92101
11. Lang & Brown CPA Tax Return $5,220
1990 Old Town Ave., Ste. Services
San Diego, CA 92110
12. Janice Blair-Cobb Preparation $3,720
12500 NW 33 Rd. Ave. of tax return
Vancouver, WA 98685
13. Thorsnes Bartolotta & Legal Services $0
McGuire
2550 Fifth Avenue,
Suite 1100
San Diego, CA 92103
FILIPINOFLASH LLC: Files for Chapter 11 Bankruptcy Protection
-------------------------------------------------------------
FilipinoFlash LLC filed for chapter 11 protection, without stating
a reason.
According to a court filing, Filipino Flash estimates between 1 and
49 unsecured creditors, including Allrise Financial Group, Seth D.
Ballstaedt,Esq., and Internal Revenue Service. Allrise has a $2.15
million disputed claim.
The petition states that funds will be available to unsecured
creditors.
A meeting of creditors under 11 U.S.C. Sec. 341(a) is slated for
May 5, 2022 at Office of UST. The deadline to file claims is June
14, 2022.
About FilipinoFlash LLC
FilipinoFlash, LLC, also known as Filipino Flash, LLC, is the
company owned by Filipino-American professional boxer and four
division world champion Nonito Donaire, Jr.
The Company previously filed for Chapter 7 bankruptcy (Bankr. S.D.
Cal. Case No. 21-01411) on April 9, 2021.
FilipinoFlash LLC filed a petition under Chapter 11, SubChapter V
of the Bankruptcy COde (Bankr. D. Nev. Case No. 22-11201) on April
5, 2022. In the petition filed by Laura Joann Ohman, as managing
member, Filipino Flash estimated assets between $0 and $50,000 and
estimated liabilities between $1 million and $10 million. The case
is assigned to Honorable Judge Mike K. Nakagawa. Seth D.
Ballstaedt, of Ballstaedt Law Firm LLC, is the Debtor's counsel.
FLEX ELECTRICAL: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Flex Electrical Group, LLC
710 Lafayette Avenue
Hawthorne, NJ 07506
Chapter 11 Petition Date: April 11, 2022
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 22-12958
Debtor's Counsel: David L. Stevens, Esq.
SCURA, WIGFIELD, HEYER, STEVENS & CAMMAROTA, LLP
1599 Hamburg Turnpike
Wayne, NJ 07470
Tel: 973-696-8391
Email: ecfbkfilings@scuramealey.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Felix Camacho as member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/MG5UVHQ/Flex_Electrical_Group_LLC__njbke-22-12958__0001.0.pdf?mcid=tGE4TAMA
GASHI & HAN: Wins Interim Cash Collateral Access
------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey has
authorized Gashi & Han LLC d/b/a Cafe Locale to use cash collateral
on an interim basis up to the aggregate amount of $180,000.
The Debtor is permitted to use cash collateral for the maintenance
and preservation of assets, continued operation of the business,
including but not limited to payroll, payroll taxes, employee
expenses and insurance costs, the completion of work-in-process,
and the purchase of replacement inventory.
As adequate protection for the use of Cash Collateral, the SBA is
granted a replacement perfected security interest in and to all of
the Debtor's now-existing and hereafter acquired assets.
To the extent that the adequate protection provided proves
insufficient to protect the SBA's interest in and to the cash
collateral, the SBA will have a super priority administrative
expense claim, pursuant to Bankruptcy Code Section 507(b), senior
to any and all claims against the Debtor under Section 507(b),
whether in this proceeding or in any superseding proceeding.
The replacement lien and security interest granted is automatically
deemed perfected upon the entry of the Order, without the necessity
of the SBA taking possession, filing financing statements,
mortgages or other documents.
The Debtor will remit monthly payments to the SBA in the amount of
$700 commencing May 15, 2022.
A final hearing on the matter is scheduled for April 26, 2022 at 11
a.m.
A copy of the order and the Debtor's budget is available at
https://bit.ly/3JnKWpD from PacerMonitor.com.
The Debtor projects $175,000 in total monthly income and $170,244
in total monthly expenses.
About Gashi & Han LLC
Gashi & Han LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. N.J. Case No. 22-12451) on March 28,
2022. In the petition signed by Enver Gashi, managing member, the
Debtor disclosed up to $50,000 in assets.
Judge Stacey L. Meisel oversees the case.
Davide Edelberg, Esq., at Scarinci Hollenbeck, is the Debtor’s
counsel.
GML LOGISTICS: Medium Unsecured to Get $129 Per Month for 72 Months
-------------------------------------------------------------------
GML Logistics, LLC, filed with the U.S. Bankruptcy Court for the
Western District of Pennsylvania a Chapter 11 Plan dated April 7,
2022.
Class 2 consists of Other Secured Claims. So long as payments are
current to holders of Class 2 Claims pursuant to this plan, such
holders shall not exercise any rights they may have against
responsible third parties. Debtor shall elect with respect to each
secured creditor whether to retain the collateral and pay the debt
or to return the collateral and treat the deficiency, if any, as an
unsecured claim.
Debtor will maintain payments on the following claims: 1) Ally
Bank, Payment Processing Center, P.O. Box 78367, Phoenix, AZ 85062
with a secured balance of $28,863.94 at 10.94% to be paid over a 72
month period for a monthly payment of $479.07, 2) The LCF Group,
Attn: Ariel Elgadeh, 3000 Marcus Avenue, Suite 2W15, Lake Success,
NY 11042 with a secured balance of $32,764.85 to be paid over a 72
moth period for a monthly payment of $455.07, 3) Funding Metrics,
3220 Tillman Drive, Suite 200, Bensalem, PA 19020 with a secured
balance of $15,174.03 to be paid over a 72 month period for a
monthly payment of $210.75, 4) Reliant Funding, 9540 Towne Center
Drive, Suite 200, San Diego, CA 92121 with a secured balance of
$10,903.76 to be paid over a 72 month period for a monthly payment
of $151.44, 5) Pearl Capital, 525 Washington Blvd., 22nd Floor,
Jersey City, NJ 07310 with a secured balance of $29,925.00 to be
paid over a 72 month period for a monthly payment of $415.63, 6)
Green Grass Capital, 30 Broad Street, New York, NY 10040 with a
secured balance of $16,636.00 to be paid over a 72 month period for
a monthly payment of $277.27.
Class 4 consists of Medium Unsecured Claims. Medium unsecured
claims are those between $500.00 and $100,000.00. There is
presently 1 claim in this category. 1) Funding Metrics, 3220
Tillman Drive, Suite 200, Bensalem, PA 19020 with an unsecured
claim of $9,316.76 to be paid over a 72 month period for a monthly
payment of $129.40.
Class 5 consists of Smaller Unsecured Claims. Smaller unsecured
claims are those $500.00 and under. There is presently 1 claim in
this category. 1) Capital One Bank, P.O. Box 71083, Charlotte, NC
28272- 1083 with a claim in the amount of $407.43 to be paid in two
monthly installment payments of $203.72.
The payments, distributions, and other treatments provided in
respect of each Allowed Claim and Allowed Interest in this Article
IV shall be in complete satisfaction, discharge and release of such
Allowed Claim and Allowed Interest.
Notwithstanding any other provision of the Plan specifying a date
or time for the payment of distribution of consideration hereunder,
payments and distributions in respect of any Claim and interest
which at such date or time is disputed, unliquidated, or contingent
shall not be made until such Claim or Interest becomes an Allowed
Claim or Allowed Interest, whereupon such payment and distributions
shall be made promptly, together with any interest accrued thereon
in accordance with the provisions of this Plan.
Until such time as all of the payments contemplated to be made have
been made, Debtor covenants as follows:
* That it will preserve and maintain assets of the estate and
* That it shall maintain and cause to be maintained a system
of accounting established and administered in accordance with
generally accepted accounting principles then in effect and true,
complete and accurate records and books of account.
A full-text copy of the Chapter 11 Plan dated April 7, 2022, is
available at https://bit.ly/37gOM6R from PacerMonitor.com at no
charge.
Attorney for the Debtor:
Rodney D. Shepherd, Esquire
PA I.D. No 56914
2403 Sidney Street
Suite 208
Pittsburgh, PA 15203
(412) 471-9670
About GML Logistics
GML Logistics, LLC, filed a Chapter 11 Petition (Bankr. W.D. Pa.
Case No. 22-20037) on Jan. 7, 2022. The Debtor is represented by
Rodney D. Shepherd, Esq. of LAW OFFICES OF RODNEY SHEPHERD.
GTT COMMUNICATIONS: Announces New Directors for Chapter 11 Exit
---------------------------------------------------------------
On April 6, 2022, GTT Communications, Inc., a leading global cloud
networking provider to multinational clients, announced the
selection of directors that will be appointed to GTT's Board of
Directors upon emergence from chapter 11. The new chairman of the
board will be Anthony Abate, and the named directors will be
Sherman Edmiston, Jon Lin, Adam Malin, Ernest Ortega, James Parker,
and Wayne Rehberger. The new board of directors will be formally
constituted and appointed upon GTT's and its debtor-subsidiaries'
emergence from their prepackaged chapter 11 cases, which is
expected to occur within the next several months after certain
required regulatory approvals have been obtained. The U.S.
Bankruptcy Court for the Southern District of New York approved
GTT’s prepackaged plan of reorganization on December 16, 2021.
The new board will bring substantial knowledge of the
telecommunications industry and corporate finance, coupled with
seasoned governance experience, in support of the Company's
business transformation and growth phase of its multi-year
strategy.
Anthony "Tony" Abate, who will be the new chairman of the board of
reorganized GTT, currently serves as a director of GTT and a member
of GTT's Strategic Planning Committee. Mr. Abate also currently is
the chairman of the board of directors of Southeastern Grocers and
director and Audit Committee chair of Denbury, Inc. Previously, he
served as an independent director of TOPS and Broadview Networks,
after each emerged from bankruptcy. He also served as an
independent director for Looking Glass Networks and Cbeyond
Communications. In addition to his board activity, Mr. Abate spent
the past 16 years in operating roles, most recently as chief
operating officer and chief financial officer of Echo360, Inc. Mr.
Abate also spent over a decade as an investor at Battery Ventures
and Whitney & Co., serving on the board of several private equity
backed businesses, and worked as a consultant at McKinsey & Co.,
where he advised several leading publicly traded companies on
business performance improvement and new market expansion.
Sherman Edmiston III currently serves as a director of GTT and a
member of GTT's Strategic Planning Committee. Since August 2016,
Mr. Edmiston has served as a managing member of HI CapM Advisors.
He also currently serves as a director of Arko Corp., Key Energy
Services, Inc., Real Alloy, and Riverbed Technology, Inc. Mr.
Edmiston previously has served as a director of Arch Resources,
Centric Brands, Inc., IPC Systems, Inc., Mallinckrodt SpecGX., and
HCR ManorCare Inc.
Jon Lin serves as the executive vice president and general manager
at Equinix, responsible for Equinix's Data Center Services
business. Mr. Lin has been with Equinix for more than 13 years, and
has held senior leadership positions in strategy, product,
engineering, sales engineering, and professional services
throughout his career. Prior to Equinix, Mr. Lin held leadership
roles at Tata Communications and UUNET/Verizon.
Ernest "Ernie" Ortega currently serves as CEO of GTT and will
continue on in this role. Mr. Ortega brings over 30 years of
experience in the telecommunications industry with a strong record
of delivering revenue growth at major companies. He has held
various C-level roles with leading organizations with
responsibility for $400 million to $1.7 billion in revenue. Prior
to joining GTT in 2019, Mr. Ortega was CEO of Towerstream. He was
also chief revenue officer at Colt Technology Services. Before
joining Colt, Mr. Ortega was chief revenue officer at Cogent, and
prior to that, he spent 14 years at XO Communications in leadership
positions, including executive vice president of sales and
marketing.
James Parker is CEO and member of the board of directors for Tangoe
and has two decades of leadership experience in enterprise
software, cloud, and telecom. Prior to joining Tangoe's leadership
team, he was CEO and executive director for Masergy, a leading
software-defined global network company. Before joining Masergy,
Mr. Parker served as chief customer officer for Tata
Communications. Earlier in his career, Mr. Parker held senior
leadership roles with CenturyLink and Microsoft.
Wayne Rehberger served as the senior vice president and CFO of
Engility from 2015 until his retirement in 2019. Mr. Rehberger was
also the CFO at TASC, from 2010 to its subsequent merger with
Engility in 2015. Prior to his CFO roles in the professional
services industry, Mr. Rehberger served as the COO of XO
Communications. Before taking on the role of COO in 2004, Mr.
Rehberger also served as XO’s CFO for more than four years. Prior
to that, Mr. Rehberger was affiliated with MCI Communications,
where he held several broad financial roles. Mr. Rehberger also has
served as a director on several public and private boards. He most
recently was a director of QTS Realty Trust and, from 2020 to 2021,
served on the board of Fusion Connect. Mr. Rehberger currently
serves on the board of Abt Associates as a member of both the Audit
and Compensation committees. He is also a member of the advisory
boards of SAP National Security Services, a subsidiary of SAP, and
Pixelligent, an international nano-technology company.
Adam Malin is a partner and senior member of the investment team at
Anchorage Capital Group. Mr. Malin has led investments for the firm
for over 10 years in the technology and telecommunications sectors.
Prior to joining Anchorage in 2009, he was an analyst in the
financial restructuring group with Goldman Sachs in New York, where
he focused on advisory and financings for companies across a
variety of industries. Mr. Malin has served as a board observer for
several companies, including eir, a large fixed and mobile
communications provider in Ireland, and SentinelOne, a
cyber-security company.
Additional information regarding GTT’s reorganization, including
court filings and additional information regarding the individuals
selected to serve on the board of directors of reorganized GTT, can
be accessed free of charge by visiting GTT’s restructuring
website at https://cases.primeclerk.com/GTT or for a fee via PACER
at https://www.pacer.gov.
About GTT Communications
Headquartered in McLean, Va., GTT Communications, Inc. --
http://www.gtt.net/-- owns and operates a global Tier 1 Internet
network and provides a comprehensive suite of cloud networking
services.
GTT and its affiliates sought Chapter 11 protection (Bankr.
S.D.N.Y. Lead Case No. 21-11880) on Oct. 31, 2021, to implement a
prepackaged Chapter 11 plan.
GTT had total assets of $2.8 billion and total debt of $4.1 billion
as of June 30, 2021. As of the petition date, the Debtors had
pre-bankruptcy funded indebtedness totaling $2.015 billion.
Judge Michael E. Wiles oversees the cases.
The Debtors tapped Akin Gump Strauss Hauer & Feld, LLP as legal
counsel; TRS Advisors as financial advisor and investment banker;
The Siegfried Group, LLP as accounting and financial resource
services provider; Ernst & Young LLP as tax, valuation and
accounting and advisory services provider; and Alvarez & Marsal,
LLC as restructuring advisor. Brian Fox, Alvarez & Marsal's
managing director, serves as the Debtors' chief restructuring
officer. Prime Clerk, LLC is the claims agent and administrative
advisor.
HOLMDEL FINANCIAL: Gets Court Nod to Use Cash Collateral
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey authorized
Holmdel Financial Services, Inc. to use cash collateral on an
interim basis in accordance with the budget up to the aggregate
amount of $36,000 and provide adequate protection for a 30-day
period.
Lakeland Bank has asserted a secured claim against the Debtor in
the approximate amounts of $806,031 as of the Petition Date.
Lakeland has, and the Debtor has acknowledged and agreed Lakeland
has, as of the Petition Date, a valid and subsisting first lien and
security interest in the Debtor's tangible and intangible personal
property consisting of inventory, accounts receivable, accounts,
equipment, furniture, fixtures securing the Debtor's indebtedness,
in the total principal amount of $806,031, together with accrued
interest, fees and costs.
The Debtor is permitted to use cash collateral for these purposes:
a. Maintenance and preservation of its assets; and
b. The continued operation of its business, including but not
limited to payroll, payroll taxes, employee expenses, insurance
costs and professional fees;
c. Continuation of work in progress;
d. Payment of ongoing and customary business expenses.
As adequate protection for the use of cash collateral, Lakeland
Bank is granted replacement perfected security interest under
Section 361(2) of the Bankruptcy Code to the extent Lakeland cash
collateral is used by the Debtor, to the extent and with the same
priority in the Debtor's post-petition collateral, and proceeds
thereof, that Lakeland held in the Debtor's pre-petition
collateral.
To the extent the adequate protection provided for proves
insufficient to protect Lakeland's interest in and to the cash
collateral, Lakeland will have a superpriority administrative
expense claims, pursuant to Section 507(b) of the Bankruptcy Code,
senior to any and all claims against the Debtor under section
507(a) of the Bankruptcy Code, whether in the proceeding or in any
superseding proceeding; subject to fees pursuant to 28 U.S.C.
Section 1930(a)(6).
The replacement lien and security interest granted is automatically
deemed perfected upon the entry of the Order without the necessity
of Lakeland taking possession, filing financing statements,
mortgages or other documents.
The Debtor will make monthly interest only payments to Lakeland
based on the interest rate set forth in the Note. The interest only
payment will be made in the amount of $3,609 per month. The
payments will begin on the 1st of April and continue on the first
of each month thereafter.
A final hearing on the matter is scheduled for April 22, 2022 at 2
p.m.
A copy of the order is available at https://bit.ly/3joJRDi from
PacerMonitor.com.
About Holmdel Financial Services, Inc.
Holmdel Financial Services, Inc. is a life insurance brokerage
general agency, operating since 1994. It is a small business and
has its offices located at 1 Bethany Road, Suite 96, Hazlet, New
Jersey.
Holmdel sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. N.J. Case No. 22-12393) on March 25, 2022. In the
petition signed by Christopher Nalbandian, president, the Debtor
disclosed $210,298 in assets and $3,448,207 in liabilities.
Judge Christine M. Gravelle oversees the case.
Marc C. Capone, Esq., at Gillman, Bruton, and Capone, LLC is the
Debtor's counsel.
HOMELIBERTY INC: Case Summary & Six Unsecured Creditors
-------------------------------------------------------
Debtor: HomeLiberty, Inc.
c/o Its Registered Agent
Incorporating Services LTD
1010 North Dale Street
Saint Paul, MN 55117-5603
Business Description: HomeLiberty provides financial products to
qualified homeowners with severe negative
equity.
Chapter 11 Petition Date: April 12, 2022
Court: United States Bankruptcy Court
District of Minnesota
Case No.: 22-30548
Judge: Hon. Kesha L. Tanabe
Debtor's Counsel: Steven B. Nosek, Esq.
STEVEN B. NOSEK, P.A.
Attorney at Law
2855 Anthony Lane S, #201
St. Anthony, MN 55418
Tel: 612-335-9171
Fax: 612-789-2109
Email: snosek@noseklawfirm.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Patricia Hanratty as chief executive
officer.
A full-text copy of the petition containing, among other items, a
list of the Debtor's six unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/D6AP7NI/HomeLiberty_Inc__mnbke-22-30548__0001.0.pdf?mcid=tGE4TAMA
JK 325 LLC: Case Summary & Two Unsecured Creditors
--------------------------------------------------
Debtor: JK 325 LLC
325 S. Dean Road
Orlando, FL 32825
Business Description: JK 325 LLC is a provider of legal services.
The Debtor is the fee simple owner of a
property located at 325 S. Dean Road,
Orlando, FL 32825 valued at $608,935.
Chapter 11 Petition Date: April 10, 2022
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 22-01286
Judge: Hon. Lori V. Vaughan
Debtor's Counsel: Jeffrey S. Ainsworth, Esq.
BRANSONLAW, PLLC
1501 E. Concord Street
Orlando, FL 32803
Tel: 407-894-6834
Fax: 407 894 8559
Email: jeff@bransonlaw.com
Total Assets: $660,835
Total Liabilities: $1,164,918
The petition was signed by Joseph Stephan as authorized
representative.
A full-text copy of the petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/ORUUPSA/JK_325_LLC__flmbke-22-01286__0001.0.pdf?mcid=tGE4TAMA
MAJESTIC HILLS: May 12 Disclosure Statement Hearing Set
-------------------------------------------------------
Judge Gregory L. Taddonio has entered an order within which May 12,
2022 at 11:30 AM Courtroom A, 54th Floor, U.S. Steel Tower, 600
Grant Street, Pittsburgh, PA 15219 is the hearing to consider
approval of the disclosure statement for Debtor Majestic Hills,
LLC.
In addition, May 5, 2022 is fixed as the last date to file and
serve written objections to the disclosure statement.
A full-text copy of the order dated April 5, 2022, is available at
https://bit.ly/3LWygrt from PacerMonitor.com at no charge.
About Majestic Hills
Majestic Hills, LLC, a privately held company that owns certain
property in Pennsylvania, filed a Chapter 11 petition (Bankr. W.D.
Pa. Case No. 20-21595) on May 21, 2020. At the time of filing, the
Debtor was estimated to have $1 million to $10 million in assets
and liabilities. The Hon. Gregory L. Taddonio oversees the case.
The Debtor's counsel is Donald R. Calaiaro of Calairo Valencik.
NEW BROUGHTON: Case Summary & Two Unsecured Creditors
-----------------------------------------------------
Debtor: New Broughton Street, LLC
618 East Broughton Street
Savannah, GA 31401
Chapter 11 Petition Date: April 11, 2022
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 22-01438
Debtor's Counsel: Jake C. Blanchard, Esq.
BLANCHARD LAW, P.A.
1501 Belcher Road South
Unit 6B
Largo, FL 33771
Tel: 727-531-7068
Fax: 727-535-2068
Email: jake@jakeblanchardlaw.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Kris Callen as manager.
A full-text copy of the petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/Y7ADMCY/New_Broughton_Street_LLC__flmbke-22-01438__0001.0.pdf?mcid=tGE4TAMA
NORDIC AVIATION: Further Fine-Tunes Plan Documents
--------------------------------------------------
Nordic Aviation Capital Designated Activity Company and Its Debtor
Affiliates submitted a Third Amended Joint Chapter 11 Plan of
Reorganization (Technical Modifications) and a corresponding
Disclosure Statement dated April 5, 2022.
While the Plan constitutes a single plan of reorganization for all
Debtors, the Plan does not contemplate substantive consolidation of
any of the Debtors.
Class C1 consists of all NAC DAC Unsecured Funded Debt Claims. Each
Holder of an Allowed NAC DAC Unsecured Funded Debt Claim shall
receive, at the option of such Holder (unless otherwise stated
herein), its Pro Rata share of the NAC DAC Unsecured Funded Debt
Claims Recovery Pool, either:
* in Cash; or
* as a Pro Rata share of the NAC DAC Unsecured Funded Debt
Claims New Ordinary Shares Allocation; provided that,
notwithstanding the foregoing option, (x) Option A/D Holders, in
their capacity as such, shall receive such Pro Rata share of the
NAC DAC Unsecured Funded Debt Claims Recovery Pool as a Pro Rata
share of the NAC DAC Unsecured Funded Debt Claims New Ordinary
Shares Allocation and for the purposes of the Plan shall be deemed
to have elected to receive such treatment, and (y) the
Moelis/Weil/NRF Consenting Exiting Creditors, in their capacity as
such, and Holders of NAC 33/34 Loan Claims, in their capacity as
such, shall receive such Pro Rata share of the NAC DAC Unsecured
Funded Debt Claims Recovery Pool in Cash; provided, further, that
to the extent the NAC DAC Unsecured Funded Debt Claims New Ordinary
Shares Allocation equals 5.00 percent of the New Ordinary Shares
(prior to consummation of the Rights Offering (including issuance
of the Backstop Shares), payment of the Rights Offering Premiums,
and implementation of the Management Incentive Plan), any remaining
balance of the NAC DAC Unsecured Funded Debt Claims Recovery Pool
that is payable to Holders electing the NAC DAC Unsecured Funded
Debt Claims New Ordinary Shares Allocation shall be paid in Cash to
such Holders electing the NAC DAC Unsecured Funded Debt Claims New
Ordinary Shares Allocation on a Pro Rata basis.
Class D1 consists of all NAC 29 Funded Debt Claims. ach Holder of
an Allowed NAC 29 Funded Debt Claim shall receive:
* its Pro Rata share of the Initial New NAC 29 Debt; provided
that, subject to Article VI.E.2 of the Plan, each Holder of an
Allowed NAC 29 Funded Debt Claim shall have the option, in its sole
discretion, to elect (such election to be made on the duly
submitted ballot setting forth such Holder's vote on the Plan)
toreceive either New NAC 29 Notes or New NAC 29 Term Loan Facility
Loans (but not both). Subject to Article VI.E.2 of the Plan, if a
Holder of an Allowed NAC 29 Funded Debt Claim on account of the
USPP Notes does not make such an election, such Holder shall
receive its Pro Rata share of the Initial New NAC 29 Debt in the
form of New NAC 29 Notes. If a Holder of an Allowed NAC 29 Funded
Debt Claim under a NAC 29 Facilities Agreement does not make such
an election, such Holder shall receive its Pro Rata share of the
Initial New NAC 29 Debt in the form of New NAC 29 Term Loan
Facility Loans;
* its Pro Rata share of the NAC 29 New Ordinary Shares
Allocation, subject to dilution by the Rights Offering Shares
(including, for the avoidance of doubt, the Backstop Shares), the
Rights Offering Premiums, and the Management Incentive Plan;
Class O5 consists of all Interests in the Investec NAC 8 Debtors.
All Interests in the Investec NAC 8 Debtors shall, at the election
of the Majority Investec NAC 8 Lenders, be surrendered, cancelled,
released, and/or extinguished, or otherwise transferred, and
Holders of such Interests will not receive any distribution on
account thereof.
Issuance and Distribution of the New Ordinary Shares, the New NAC
33/34 HoldCo Interests, the New Moelis/Weil/NRF Equity, and the New
Profit Participating Notes, and Transfer of the Reorganized JOLCO
Equity.
Except as otherwise provided herein, the Debtors or Reorganized
Debtors, as applicable, shall use Cash on hand to fund
distributions to certain Holders of Claims, including the payment
of Allowed General Unsecured Claims.
A Holder of an Allowed NAC 29 Notes Claim shall receive its Pro
Rata share of the Initial New NAC 29 Debt in the form of New NAC 29
Term Loan Facility Loans if the distribution of such Holder's Pro
Rata share of the Initial New NAC 29 Debt in the form of New NAC 29
Notes would result in such Holder's receiving New NAC 29 Notes with
an aggregate face amount less than or equal to €[100,000.00].
"Initial New Ordinary Shares Pool" means New Ordinary Shares
comprising 95.00 percent (prior to consummation of the Rights
Offering (including issuance of the Backstop Shares), payment of
the Rights Offering Premiums, and implementation of the Management
Incentive Plan) of the New Ordinary Shares to be issued to Holders
of Allowed Claims pursuant to the Plan.
"Moelis/Weil/NRF Exiting Debtor Aviation Insurance Contract" means
any aviation insurance or aircraft insurance contract or policy
entered into by a Moelis/Weil/NRF Exiting Debtor prior to the
Petition Date under which such Moelis/Weil/NRF Exiting Debtor is
the sole policyholder.
"Secondary New Ordinary Shares Pool" means New Ordinary Shares
comprising 5.00 percent (prior to consummation of the Rights
Offering (including issuance of the Backstop Shares), payment of
the Rights Offering Premiums, and implementation of the Management
Incentive Plan) of the New Ordinary Shares to be issued to Holders
of Allowed Claims pursuant to the Plan.
Co-Counsel to the Debtors:
Edward O. Sassower, Esq.
Emily Geier, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
- and -
Chad J. Husnick, P.C., Esq.
David R. Seligman, P.C., Esq.
Jaimie Fedell, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle Street
Chicago, Illinois 60654
Telephone: (312) 862-2000
Facsimile: (312) 862-2200
- and -
Michael A. Condyles, Esq.
Peter J. Barrett, Esq.
Jeremy S. Williams, Esq.
KUTAK ROCK LLP
901 East Byrd Street, Suite 1000
Richmond, Virginia 23219-4071
Telephone: (804) 644-1700
Facsimile: (804) 783-6192
About Nordic Aviation Capital
Nordic Aviation Capital is the leading regional aircraft lessor
serving almost 70 airlines in approximately 45 countries. Its
fleet of 475 aircraft includes ATR 42, ATR 72, De Havilland Dash 8,
Mitsubishi CRJ900/1000, Airbus A220 and Embraer E-Jet family
aircraft.
On Dec. 17, 2021, Nordic Aviation Capital Pte. Ltd., NAC Aviation
17 Limited, NAC Aviation 20 Limited, and Nordic Aviation Capital
A/S each filed petitions seeking relief under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Va.). On Dec. 19, 2021, Nordic
Aviation Capital Designated Activity Company and 112 affiliated
companies also filed petitions seeking Chapter 11 relief. The lead
case is In re Nordic Aviation Capital Designated Activity Company
(Bankr. E.D. Va. Lead Case No. 21-33693).
Judge Kevin R. Huennekens oversees the cases.
The Debtors tapped Kirkland & Ellis and Kutak Rock, LLP as
bankruptcy counsels and the law firms of Clifford Chance, LLP,
William Fry, LLP and Gorrissen Federspiel as corporate counsels.
N.M. Rothschild & Sons Limited, Ernst & Young, LLP and
PricewaterhouseCoopers, LLP serve as the Debtors' financial
advisor, restructuring advisor and tax advisor, respectively. Epiq
Corporate Restructuring, LLC is the claims and noticing agent.
NUVEDA LLC: Case Summary & Four Unsecured Creditors
---------------------------------------------------
Debtor: NuVeda LLC
PO Box 6255
Pahrump, NV 89041
Chapter 11 Petition Date: April 11, 2022
Court: United States Bankruptcy Court
District of Nevada
Case No.: 22-11249
Judge: Hon. August B. Landis
Debtor's Counsel: Mitchell Stipp, Esq.
LAW OFFICE OF MITCHELL STIPP, P.C.
1180 N. Town Center Drive, Suite 100
Las Vegas, NV 89144
Tel: 702-602-1242
Email: mstipp@stippaw.com
Debtor's
Co-Counsel: LAW OFFICE OF NATHAN A. SCHULTZ, P.C.
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Pejman Bady as manager.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/FLLXPOQ/NuVeda_LLC__nvbke-22-11249__0001.0.pdf?mcid=tGE4TAMA
PADDOCK ENTERPRISES: Unsecured Creditors Unimpaired in Plan
-----------------------------------------------------------
Paddock Enterprises, LLC, submitted a Second Amended Plan of
Reorganization.
Under the Plan, holders of Class 4 General Unsecured Claims will be
paid in full plus Postpetition Interest (if any, and only to the
extent owed under contract or as a matter of applicable
non-bankruptcy law) in Cash, on, or as soon as practicable after
the later of: (a) the Effective Date, (b) the date on which such
General Unsecured Claim becomes an Allowed General Unsecured Claim,
(c) the date such General Unsecured Claim becomes due and payable
according to its terms, or (d) such other date as mutually may be
agreed to by and between the Holder of such General Unsecured Claim
and the Debtor or Reorganized Debtor. Class 4 is unimpaired.
"Postpetition Interest" means: (a) with respect to General
Unsecured Claims and Other Priority Claims, postpetition interest
at the Federal Judgment Rate in effect on the applicable Petition
Date; (b) with respect to Priority Tax Claims, interest consistent
with section 511 of the Bankruptcy Code; and (c) with respect to
Secured Claims, postpetition interest at the applicable contract
rate or, if none, at the Federal Judgment Rate in effect on the
Petition Date.
Counsel to the Debtor:
Jeffrey E. Bjork, Esq.
Kimberly A. Posin, Esq.
Helena G. Tseregounis, Esq.
Christina M. Craige, Esq.
LATHAM & WATKINS LLP
355 South Grand Avenue, Suite 100
Los Angeles, California 90071
Telephone: (213) 485-1234
Facsimile: (213) 891-8763
- and -
George A. Davis, Esq.
Christopher J. Kochman, Esq.
Brian S. Rosen, Esq.
Jonathan J. Weichselbaum, Esq.
1271 Avenue of the Americas
New York, New York 10020
Telephone: (212) 906-1200
Facsimile: (212) 751-4864
John H. Knight, Esq.
Michael J. Merchant, Esq.
Brendan J. Schlauch, Esq.
Sarah Silveira, Esq.
RICHARDS, LAYTON & FINGER, P.A.
One Rodney Square
920 N. King Street
Wilmington, Delaware 19801
Telephone: (302) 651-7700
Facsimile: (302) 651-7701
Counsel to the Official Committee of Asbestos Personal Injury
Claimants:
Kevin C. Maclay, Esq.
Todd E. Phillips, Esq.
Kevin M. Davis, Esq.
CAPLIN & DRYSDALE, CHARTERED
One Thomas Circle, NW, Suite 1100
Washington, D.C. 20005
Tel: (202) 862-5000
Fax: (202) 429-3301
Marla R. Eskin, Esq.
Mark T. Hurford, Esq.
CAMPBELL & LEVINE, LLP
222 Delaware Avenue, Suite 1620
Wilmington, DE 19801
Telephone: (302) 426-1900
Fax: (302) 426-9947
Counsel to the Future Claimants' Representative:
Robert S. Brady, Esq.
Edwin J. Harron, Esq.
Sharon M. Zieg, Esq.
Sara Beth A.R. Kohut, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square 1000
North King Street
Wilmington, Delaware 19801
Telephone: (302) 571-6600
Facsimile: (302) 571-1253
Counsel to O-I Glass, Inc.:
Derek C. Abbott, Esq.
Brett S. Turlington, Esq.
MORRIS NICHOLS ARSHT & TUNNELL LLP
1201 North Market Street, Suite 1600
Wilmington, DE 19801
Telephone: (302) 658-9200
Facsimile: (302) 658-3989
A copy of the Disclosure Statement dated Apr. 1, 2022, is available
at https://bit.ly/3LYSbWX from Kroll, the claims agent.
About Paddock Enterprises
Paddock Enterprises, LLC's business operations are exclusively
focused on (i) owning and managing certain real property and (ii)
owning interests in, and managing the operations of, its non debtor
subsidiary, Meigs, which is developing an active real estate
business. It is the successor-by-merger to Owens-Illinois, Inc.,
which previously served as the ultimate parent of the company.
Paddock Enterprises is a direct, wholly-owned subsidiary of O-I
Glass.
Paddock Enterprises sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D. Del. Case No. 20-10028) on Jan. 6, 2020.
At the time of the filing, the Debtor disclosed assets of between
$100 million and $500 million and liabilities of the same range.
Judge Laurie Selber Silverstein oversees the case.
The Debtor tapped Richards, Layton & Finger P.A. and Latham &
Watkins LLP as legal counsel, Alvarez & Marsal North America LLC as
a financial advisor, Riley Safer Holmes & Cancila, LLP as special
counsel, and David J. Gordon of DJG Services, LLC as a chief
restructuring officer. Prime Clerk, LLC, is the claims, noticing,
and solicitation agent and administrative advisor.
PHOENIX PROPERTIES: Bid to Access Cash Collateral Denied as Moot
----------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Georgia,
Savannah Division, denied as moot the Amended Motion to Use Cash
Collateral filed by Phoenix Properties of Savannah, LLC.
A final hearing on the Amended Motion to Use Cash Collateral was
scheduled for April 6, 2022. At that hearing, the Debtor's counsel
represented that Wilmington Savings Fund Society, FSB, d/b/a
Christiana Trust, no longer opposed the Debtor's bid to use cash
collateral because, following the February 24, 2022 hearing, the
Debtor sought and received the Court's permission to sell, pursuant
to 11 U.S.C. section 363(b), several of the parcels of real
property securing Wilmington's claim in order to pay the claim in
full from the sales proceeds. Its claim having been satisfied,
Wilmington withdrew its motion to dismiss the case. Based on these
representations, the Court announced that the Amended Motion to Use
Cash Collateral would be denied as moot.
A copy of the order is available at https://bit.ly/3v4swoD from
PacerMonitor.com.
About Phoenix Properties of Savannah
Phoenix Properties of Savannah, LLC is a Savannah, Ga.-based
company engaged in renting and leasing real estate properties.
Phoenix Properties of Savannah filed a petition for Chapter 11
protection (Bankr. S.D. Ga. Case No. 21-40785) on Dec. 2, 2021,
listing as much as $10 million in both assets and liabilities.
Judge Edward J. Coleman, III oversees the case.
James L. Drake, Jr., PC serves as the Debtor's legal counsel.
QUEEN ELIZABETH: BofA Says Claim Oversecured, Should be Paid 100%
-----------------------------------------------------------------
Bank of America, N.A., a creditor of debtor Queen Elizabeth Realty
Corp. (the "Debtor") of case no. 20-73327 as jointly administered,
submitted an objection to the proposed debtor Queen Elizabeth
Realty Corp.'s Second Amended Disclosure Statement for the Second
Amended Chapter 11 Plan Proposed by the Debtor in Possession, which
was submitted in conjunction with the proposed Debtor's Second
Amended Chapter 11 Plan of Reorganization.
The Bank points out that the 2nd Amended Disclosure Statement
includes a description of the 5 classes of claims, with the Bank's
Claim included in Class 1 Secured Claim of Bank of America. The
Debtor asserts that the Bank "shall be paid in full its allowed
claim as agreed by and between the parties..." but fails to
acknowledge the entire allowed amount of the Bank's Claim and that
the Bank's Claim is oversecured.
The Bank objects to the 2nd Amended Disclosure Statement to the
extent that it proposes to pay the Bank anything less than the full
amount of the Bank's Claim, including the swap termination payment,
and all accrued interest and fees, with credit given to the Debtor
for any previously-remitted payments. The 2nd Amended Disclosure
Statement must recognize that the Bank's Claim is an allowed
secured claim and represent that the Bank's Claim will be paid in
its entirety.
The Bank asserts objections to the Debtor's 2nd Amended Plan that
are based upon and correspond to the objections set forth herein,
and expressly reserves the right to further assert such objections
in advance of and at the Confirmation Hearing.
Attorneys for Bank of America, N.A.:
Timothy R. Wheeler, Esq.
WILSON, ELSER, MOSKOWITZ, EDELMAN & DICKER LLP
150 East 42nd Street
New York, New York 10017-5639
Tel: (212) 490-3000
Fax: (212) 490-3038
About Lucky Star-Deer Park, et al.
Lucky Star-Deer Park, LLC, is a single asset real estate as defined
in 11 U.S.C. Section 101(51B). The company is based in Flushing,
N.Y.
Lucky Star-Deer Park and affiliates, Flushing Landmark Realty LLC
and Victoria Towers Development Corp., sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case Nos.
20-73301, 20-73302 and 20-73303) on Oct. 30, 2020. On Nov. 3,
2020, another affiliate, Queen Elizabeth Realty Corp., filed a
Chapter 11 petition (Bankr. E.D.N.Y. Case No. 20-73327). Judge
Robert E. Grossman oversees the cases, which are jointly
administered under Case No. 20-73301.
At the time of the filing, Lucky Star-Deer Park listed up to
$50,000 in assets and up to $500,000 in liabilities.
The Debtors tapped Rosen & Kantrow, PLLC as bankruptcy counsel;
Certilman Balin and The Law Offices of Fred L. Seeman as special
counsels; Joseph A. Broderick, P.C. as accountant; and Miu & Co. as
audit consultant.
RESTORNATIONS: Court Denies Approval of Disclosure Statement
------------------------------------------------------------
Judge Victoria S. Kaufman has entered an order denying approval of
the Amended Disclosure Statement of Restornations for purposes of
soliciting acceptances or rejections of a Chapter 11 Plan.
Judge Kaufman entered an order following a hearing on March 24 and
after considering the objections filed by Harlan Helvey and Genesis
Condominium Association, and the Debtor's replies thereto. The
judge found that the Amended Disclosure Statement lacks adequate
information, as required by
11 U.S.C. Sec. 1125.
Attorney for the Debtor:
Michael E. Plotkin, Esq.
80 South Lake Avenue, Suite 702
Pasadena, California 91101
Tel: (626) 568-8088
About Restornations
Restornations sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. C.D. Cal. Case No. 21-10500) on March 24, 2021. At
the time of the filing, the Debtor disclosed total assets of up to
$10 million and liabilities of up to $500,000. Judge Victoria
Kaufman oversees the case. Michael E. Plotkin, Esq., is the
Debtor's legal counsel.
SAVANNAH CAPITAL: Case Summary & Four Unsecured Creditors
---------------------------------------------------------
Debtor: Savannah Capital, LLC
111 W. Fortune Street
Tampa, FL 33602
Chapter 11 Petition Date: April 11, 2022
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 22-01431
Debtor's Counsel: Jake C. Blanchard, Esq.
BLANCHARD LAW, P.A.
1501 Belcher Road South
Unit 6B
Largo, FL 33771
Tel: 727-531-7068
Email: jake@jakeblanchardlaw.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Kris Callen as manager.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/UIZ7NMI/Savannah_Capital_LLC__flmbke-22-01431__0001.0.pdf?mcid=tGE4TAMA
SEARS HOLDINGS: Judge Orders Creditors, Ex-Chairman to Mediation
----------------------------------------------------------------
Soma Biswas of The Wall Street Journal reports that the judge
overseeing the bankruptcy case of Sears Holdings Corp. appointed
mediators to help resolve a $2 billion lawsuit against former
chairman Eddie Lampert and other former shareholders filed by the
retailer’s creditors three years ago.
Judge Robert Drain appointed Shelley Chapman, a fellow bankruptcy
judge in the U.S. Bankruptcy Court in New York, along with James
Peck and Jed Melnick, as mediators in the lawsuit, which alleges
that Mr. Lampert and his hedge fund stripped key assets like Lands'
End and the Sears Hometown.
About Sears Holdings Corp.
Sears Holdings Corporation (OTCMKTS: SHLDQ) --
http://www.searsholdings.com/-- began as a mail ordering catalog
company in 1887 and became the world's largest retailer in the
1960s. At its peak, Sears was present in almost every big mall
across the U.S., and sold everything from toys and auto parts to
mail-order homes. Sears claims to be is a market leader in the
appliance, tool, lawn and garden, fitness equipment, and automotive
repair and maintenance retail sectors.
Sears and Kmart merged to form Sears Holdings in 2005 when they had
3,500 US stores between them. Kmart emerged in 2005 from its own
bankruptcy.
Unable to keep up with online stores and other brick-and-mortar
retailers, a long series of store closings has left it with 687
retail stores in 49 states, Guam, Puerto Rico, and the U.S. Virgin
Islands as of mid-October 2018. At that time, the Company employed
68,000 individuals, of whom 32,000 were full-time employees.
As of Aug. 4, 2018, Sears Holdings had $6.93 billion in total
assets, $11.33 billion in total liabilities and a total deficit of
$4.40 billion.
Unable to cover a $134 million debt payment due Oct. 15, 2018,
Sears Holdings Corporation and 49 subsidiaries sought Chapter 11
protection (Bankr. S.D.N.Y. Lead Case No. 18-23538) on Oct. 15,
2018. The Hon. Robert D. Drain is the case judge.
The Debtors tapped Weil, Gotshal & Manges LLP as legal counsel;
M-III Partners as restructuring advisor; Lazard Freres & Co. LLC as
investment banker; DLA Piper LLP as real estate advisor; and Prime
Clerk as claims and noticing agent.
The U.S. Trustee for Region 2 appointed nine creditors, including
the Pension Benefit Guaranty Corp., and landlord Simon Property
Group, L.P., to serve on the official committee of unsecured
creditors. The committee tapped Akin Gump Strauss Hauer & Feld LLP
as legal counsel; FTI Consulting as financial advisor; and
Houlihan
Lokey Capital, Inc. as investment banker.
The U.S. Trustee for Region 2 on July 9, 2019, appointed five
retirees to serve on the committee representing retirees with life
insurance benefits in the Chapter 11 cases.
* * *
In February 2019, Bankruptcy Judge Robert Drain authorized Sears
Holdings approval to sell the business to majority shareholder and
CEO Eddie Lampert for approximately $5.2 billion. Lampert's ESL
Investments, Inc., won an auction to acquire substantially all of
Sears' assets, including the "Go Forward Stores" on a going-concern
basis. The proposal would allow 425 stores to remain open and
provide ongoing employment to 45,000 employees.
SHURWEST LLC: Some Creditors Hit 'Sham' Bankruptcy Plan
-------------------------------------------------------
John Hilton of Insurance NewsNet reports that some creditors are
miffed by Shurwest's 'Sham Bankruptcy' plan.
No one is disputing that Shurwest owes dozens of creditors many
millions of dollars as the independent marketing organization tries
to dig out from its ties to a pension scam.
How much the beleaguered company ends up paying is the topic of a
fierce dispute playing out in an Arizona bankruptcy court.
Shurwest filed for Chapter 11 bankruptcy Aug. 31, 2021, in a bid to
settle scores of lawsuits, all while steadfastly maintaining that
company executives knew nothing about a pension fraud scheme
adapted to hundreds of IUL sales.
According to bankruptcy documents, Shurwest faces 140 claims
totaling more than $197.5 million. The current dispute before the
court is whether to permit Shurwest to complete its bankruptcy
under Chapter 11, Subchapter V, under which it can negotiate more
favorable terms.
"Debtor has improperly attempted to shoehorn itself into a
Subchapter V on the technicality that most of its debts are
unliquidated because they have not yet been reduced to judgment,"
reads a motion filed last week by Timothy W. Horn, owner of Horn
Financial Services in Austin, Texas.
National Gold 2022-04 Body Leaderboard
Horn claimed a loss of more than $1.6 million via working with
Shurwest. In court documents, Horn claimed that Subchapter V was
designated for small-business debtors, which he claimed Shurwest
isn’t.
"Debtor has been able to take unfair advantage of the streamlined
and debtor-friendly provisions of Subchapter V to evade numerous
procedural protections intended to safeguard the interests of a
large and diverse body of creditors like those holding claims
against this estate," the Horn filing said.
Neither Horn or his attorney returned phone and email messages
seeking comment. In his motion, Horn asks the court to convert the
Shurwest case to a "traditional" Chapter 11 bankruptcy. The case
would first need to be converted to Chapter 7, Horn’s motion
reads, then to Chapter 11.
Likewise, Minnesota Life filed a motion asking the court to convert
the Shurwest bankruptcy to Chapter 7. The court will hear arguments
May 17 on both motions to convert the Shurwest bankruptcy.
'Sham Bankruptcy'
According to court documents, Shurwest is proposing to pay claims
through an arbitration process using the proceeds from three years
of revenue, which it projects at about $6.14 million. Shurwest
reported current gross income of about $125,000-$150,000 per month,
and future operating expenses to be $35,000-$40,000 per month.
That means unsecured creditors would receive about 3.1% of their
total claims, according to a motion filed by Horn.
Beginning in 2019, Shurwest began branding itself as The Quantum
Group. The two companies appear to share the same address, phone
number and employees, Minnesota Life noted in a lawsuit it filed
against Shurwest in July 2021 in the U.S. District Court for the
District of Minnesota.
The top executive for The Quantum Group, Jim Maschek, partner and
president of distribution, also signed Shurwest bankruptcy
documents as its representative. Maschek listed himself as the
president of Shurwest.
In their bankruptcy court filings, Horn and Minnesota Life claim
Shurwest is trying to shield The Quantum Group from paying any
restitution.
"Debtor filed for bankruptcy solely in order to use the automatic
stay and other provisions of Chapter 11 to summarily destroy the
legitimate rights and interests of its victims, many of whom are
elderly," Minnesota Life said in a court filing. "Cause exists
under Bankruptcy Code … to dismiss or convert this sham
bankruptcy, which is a ploy for Debtor, its alter ego Quantum, and
insiders to walk away unrepentant and unscathed."
Shurwest sold Minnesota Life products for several years until
problems arose with alleged fraudulent sales. Minnesota Life claims
the policy applications were altered on more than 1,000 policies
sold through Shurwest between 2014 to 2018. Minnesota Life would be
sued itself by several disgruntled clients.
An attorney for Minnesota Life did not return a message seeking
comment. A spokesman for Minnesota Life has said the insurer does
not comment on active litigation.
Shurwest filed a lengthy bankruptcy settlement plan in November.
The entire plan is the best way for Shurwest to repay the aggrieved
parties, said Isaac Rothschild of Mesch Clark Rothschild, a Tuscon,
Ariz., law firm handling the bankruptcy filing for Shurwest.
"There is the possibility for the Shurwest annuity business to
continue going, and if there is a light at the end of the tunnel
through a reorganized plan, it discharges the debts so Shurwest can
grow its business and maximize return to the creditors," he
explained.
The plan is going through a comment period and an effort to build a
consensus among creditors, Rothschild said.
"A majority of our contract creditors are on board," he added. "A
majority of the individual investors have suggested that our plan
could provide an appropriate mechanism. And we've been working with
them over the last month-plus to try and determine what those
factors, and what that mechanism, should look like."
Retiree Pension Scam
Shurwest executives insist they had no knowledge of a pension scam
used to goose sales of indexed universal life policies. Prosecutors
say the scam originated with a company called Future Income
Payments (FIP).
Using various marketing efforts, FIP solicited pensioners by
offering them a lump sum in exchange for a portion of their future
pension payments. FIP called the practice "structured cash flows"
and the company used brokers and insurance producers to find
investors - often retired veterans, teachers and firefighters.
Unknown to many investors, the future pension payment terms
required them to pay what often equated to an annual interest rate
exceeding 100% over a five-year term.
In time, another layer was added to the scam, prosecutors said.
Investors were urged to fund IUL policies with their FIP payment,
ostensibly to replace the pension as a retirement plan. However,
prosecutors said the new layer just created another opportunity for
rogue agents and FIP reps to further gouge investors through hidden
and high fees.
"This vehicle allows me to yield an extra 5%-6% when I'm funding a
life policy," wrote Melanie Schulze-Miller, national sales director
of life insurance for Shurwest, in a 2016 email to her boss.
“Better for client, better for us, better for agent, and it
actually creates a larger life policy because the premiums are even
higher (so extra better for us).”
Emails between then-vice president of sales Jim Maschek and
co-founder and president Ron Shurts show that Shurwest executives
were wary of the FIP idea when first proposed. Shurts wrote that he
was "uncomfortable" with the idea and wanted compliance officers to
take another look at it.
Schulze-Miller would go on to form her own company called MJSM
Financial, which handled many of the fraudulent sales, according to
court documents. Schulze-Miller claimed she did so at Maschek's
suggestion, court documents say. Shurwest execs say Schulze-Miller
went rogue with the FIP sales.
Pairing FIP with life insurance sales paid off handsomely for
Shurwest. According to court documents, the company’s annual
gross receipts were $15.7 million in 2016, and jumped to $21.1
million in 2018.
In a recent court brief, Minnesota Life said it uncovered 274 IUL
policies sold through Shurwest and linked to FIP.
"Everyone at Shurwest, including Maschek and Shurts, were fully
aware that we were promoting FIP to fund life insurance policies,"
reads an April 2021 affidavit signed Schultze-Miller.
4 Degrees Of Liability
Shurwest has good reason to want to settle the bankruptcy claims as
soon as possible. Due to the lawsuits, Shurwest spent more than
$1.7 million for professional fees alone in the first two quarters
of 2021, court documents state.
The Shurwest plan offers an "arbitration option" for claims or
going through an expedited arbitration process. Creditors opting
out of the arbitration will resolve their claims through the claim
objection process contemplated by the Rules of Bankruptcy
Procedure.
A claims arbitrator will place claims into one of four categories
of Shurwest liability, the plan said. Category one claims will
receive a distribution of "100% of the pro rata amount of its
allowed claim," the plan stated. Category two claims will receive
50% and category three, 25%.
Category four claims will receive a nominal payout, the plan
stated. These claims would be considered to have “no material
connection with Shurwest and who are unlikely to prevail in any
litigation against Shurwest,” the plan said.
"The Debtor believes that the Plan will provide a greater return to
creditors than they would receive in a liquidation under Chapter 7
or Chapter 11," the plan said. "Accordingly, Shurwest can satisfy
the 'best interests of creditors' test for confirmation of the
Plan."
About Shurwest LLC
Shurwest, LLC, a Scottsdale, Ariz.-based company that specializes
in fixed indexed annuities and life insurance, filed its voluntary
petition for Chapter 11 protection (Bankr. D. Ariz. Case No.
21-06723) on Aug. 31, 2021, listing as much as $10 million in both
assets and liabilities. James Maschek, president, signed the
petition.
Judge Daniel P. Collins oversees the case.
The Debtor tapped Isaac D. Rothschild, Esq., at Mesch Clark
Rothschild as bankruptcy counsel and Wyche, PA and King & Spalding
LLP, and Dentons as special counsels.
SOUND HOUSING: Property Sale Proceeds to Fund Plan Payments
-----------------------------------------------------------
Stuart Heath, the Chapter 11 trustee for debtor Sound Housing LLC,
filed with the U.S. Bankruptcy Court for the Western District of
Washington a Disclosure Statement in support of Plan of Liquidation
for the Debtor dated April 5, 2022.
The nature of Sound Housing, LLC's business has been the purchase,
redevelopment, and sale of real estate.
At the time of the filing of the bankruptcy petition, Sound
Housing, LLC had title to the following real properties: (1) 13328
132nd Ave. NE, Kirkland, WA 98034 (the "Kirkland Property"); (2)
1619 N. 46th Street, Seattle, WA 98103 (the "Wallingford
Property"); (3) 1800 18th Ave. S., Seattle, WA 98144 (the "South
Seattle Property"); and (4) 521 and 525 Military Rd. E., Tacoma, WA
98445 (the "Tacoma Property").
The Trustee marketed the Kirkland Property without the assistance
of a listing broker, and on December 1, 2021, the Court entered its
Order Approving Sale of Real Property (Kirkland Property) Free and
Clear of Liens. The Court entered its Amended Order Approving Sale
of Real Property (Kirkland Property) Free and Clear of Liens on
February 7, 2022. The Kirkland Property sold on February 24, 2022.
The Trustee sold the Kirkland Property for $1,050,000. As reflected
in the final settlement statement, the bankruptcy estate received
$931,214.06 of the sales proceeds.
The Tacoma Property and South Seattle Property will be sold.
Creditors whose secured claims are not disputed will be paid at
closing of the sale of the properties. Remaining work for the
Trustee will primarily concern: resolution of the avoidance actions
held by the Estate; objections to claims; and distribution to the
unsecured creditors whose claims are allowed.
In this case, there are savings arising out of: (1) the real estate
excise tax that would not need to be paid if the property is sold
pursuant to a confirmed Chapter 11 Plan; and (2) real estate
commissions that would not need to be paid if the real estate is
sold directly by the Chapter 11 Trustee. The Trustee anticipates a
sales price of the South Seattle Property to be no less than
$750,000.
The Trustee anticipates a sales price of the Tacoma Property to be
no less than $585,000. Savings in the form of real estate excise
taxes and commissions, which would not be available in a Chapter 7,
would, in such a scenario, equate to approximately $97,188
(assuming the typical 6% in real estate commissions are not paid,
1.28% real estate excise tax is not paid, and sales prices of
$750,000 and $585,000 for the South Seattle Property and Tacoma
Property, respectively).
Class 12 consists of all General Unsecured Claims filed as proofs
of claim and not objected to in the timeframe set forth in this
Plan. Class 12 further includes all General Unsecured Claims
scheduled in the Debtor's Schedule F as neither contingent,
disputed nor unliquidated.
Class 12 also includes the unsecured claims of Class 6 (Berezansky
et al.) and Class 8 (Ezra Investments, LLC). Allowed Claims will
receive, on a Pro-Rata basis, an initial distribution within 45
days after the closing of the sale of the latter of: (i) the Tacoma
Property and (ii) the South Seattle Property. The Allowed Claims
will receive a second and final distribution within 45 days of the
entry of the last final non appealable order entered in the
adversary cases and claims objections to be commenced pursuant to
this Plan.
Class 13 consists of the Allowed Interests of the Equity Holders.
The Equity Holders shall retain such interests following
Confirmation but shall receive no distributions under this Plan as
at this time, there does not appear to be any funds available to
pay Class 13 Claimants. Class 13 is not entitled to vote.
Following Confirmation and until closing of the sale of the South
Seattle Property and Tacoma Property, the Trustee shall continue to
own, control, manage and operate Sound Housing, LLC's assets and
business in the exercise of reasonable and prudent judgment in the
ordinary course of business without further notice or order of the
Court. The Trustee and any Professional Persons appointed by the
Bankruptcy Court shall remain in their respective role(s) and
operating pursuant to the jurisdiction of the Bankruptcy Court
until such time as the South Seattle Property and Tacoma Property
are sold, the causes of action pursued, and the Estate is fully
administered and closed.
A full-text copy of the Disclosure Statement dated April 5, 2022,
is available at https://bit.ly/3O5LHaz from PacerMonitor.com at no
charge.
Attorney for Trustee:
Manish Borde, WSBA #39503
BORDE LAW PLLC
600 Stewart Street, Suite 400
Seattle, WA 98101
Telephone: (206) 531-2722
E-mail: mborde@bordelaw.com
About Sound Housing LLC
Kirkland, Wash.-based Sound Housing, LLC, filed a petition for
Chapter 11 protection (Bankr. W.D. Wash. Case No. 21-10341) on Feb.
19, 2021, listing as much as $10 million in both assets and
liabilities. Judge Marc Barreca presides over the case. Jacob D
DeGraaff, Esq., at Henry & DeGraaff, P.S., is the Debtor's legal
counsel.
On Sept. 24, 2021, Stuart Heath was appointed Chapter 11 trustee in
the Debtor's case. Manish Borde, Esq., at Borde Law, PLLC and
Richard Ginnis, CPA serve as the trustee's legal counsel and
accountant, respectively.
SUNGARD AS: Case Summary & 30 Largest Unsecured Creditors
---------------------------------------------------------
Lead Debtor: Sungard AS New Holdings, LLC
565 E. Swedesford Road
Suite 320
Wayne, PA 19087
Business Description: The Debtors and their non-Debtor affiliates
provide high availability, cloud-connected
infrastructure services built to deliver
business resilience to their customers in
the event of an unplanned business
disruption, ranging from man-made events
to natural disasters. Headquartered in
Wayne, Pennsylvania, the Debtors employ
approximately 585 individuals in the United
States and Canada.
Chapter 11 Petition Date: April 11, 2022
Court: United States Bankruptcy Court
Southern District of Texas
Twelve affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Sungard AS New Holdings, LLC (Lead Case) 22-90018
Sungard Availability Services, LP 22-90017
Sungard Availability Services (Canada) Ltd. 22-90019
Sungard Availability Services Holdings (Canada), Inc. 22-90020
InFlow LLC 22-90021
Sungard AS New Holdings III, LLC 22-90022
Sungard Availability Network Solutions Inc. 22-90023
Sungard AS New Holdings II, LLC 22-90024
Sungard Availability Services Holdings (Europe), Inc. 22-90025
Sungard Availability Services Holdings, LLC 22-90026
Sungard Availability Services Technology, LLC 22-90027
Sungard Availability Services, Ltd. 22-90028
Judge: Hon. David R. Jones
Debtors'
Bankruptcy
Counsel: Philip C. Dublin, Esq.
Meredith A. Lahaie, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
One Bryant Park
New York, New York 10036
Tel: (212) 872-1000
Fax: (212) 872-1002
Email: pdublin@akingump.com
mlahaie@akingump.com
-and-
Marty L. Brimmage, Jr., Esq.
Lacy M. Lawrence, Esq.
Zach D. Lanier, Esq.
AKIN GUMP STRAUSS HAUER & FELD LLP
2300 N. Field Street, Suite 1800
Dallas, Texas 75201
Tel: (214) 969-2800
Fax: (214) 969-4343
Email: mbrimmage@akingump.com
llawrence@akingump.com
zlanier@akingump.com
Debtors'
Co-Bankruptcy
Counsel: Matthew D. Cavenaugh, Esq.
Jennifer F. Wertz, Esq.
Rebecca Blake, Esq.
JACKSON WALKER LLP
1401 McKinney Street, Suite 1900
Houston, Texas 77010
Tel: (713) 752-4200
Fax: (713) 752-4221
Email: mcavenaugh@jw.com
jwertz@jw.com
rchaikin@jw.com
Debtors'
Canadian
Legal
Counsel: CASSELS BROCK & BLACKWELL LLP
Debtors'
Special
Investment
Banker: DH CAPITAL, LLC
Debtors'
Restructuring
Investment
Banker: HOULIHAN LOKEY, INC.
Debtors'
Financial &
Restructuring
Advisor: FTI CONSULTING, INC.
Debtors'
Notice &
Claims
Agent: KROLL RESTRUCTURING ADMINISTRATION LLC
Estimated Assets: $500 million to $1 billion
Estimated Liabilities: $500 million to $1 billion
The petition was signed by Michael K. Robinson, Chief Executive
Officer and President of Sungard AS New Holdings, LLC.
A full-text copy of Sungard AS New Holdings' petition is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/5ERK6AA/Sungard_AS_New_Holdings_LLC__txsbke-22-90018__0001.0.pdf?mcid=tGE4TAMA
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Ensono LP Trade $3,808,280
3333 Finley Rd
Downers Grove, IL 60515
Attn: Nick Lofaso
Tel: 215-280-7350
Email: nicholas.lofaso@ensono.com
2. 401 North Broad Lessee, LLC Landlord $2,400,717
c/o Amerimar 401 North
Broad Management Co.
50 South 16th Street
Philadelphia, PA 19102
Attn: David Hagan
Tel: 215-893-6057
Email: dhagan@netrality.com
3. Micro Focus LLC Trade $1,517,345
4555 Great America Parkway,
Suite 400
Santa Clara, CA 95054
Attn: Brook Hoffman (McLaughlin)
Tel: 303-209-0079
Email: brook.mclaughlin@microfocus.com
4. Avant Communications Marketing $1,372,560
2 N. Riverside Plaza, Suite 2450 Partner
Chicago, IL 60606
Attn: Shane MaNamara
Email: smcnamara@goavant.net
5. Bridgepointe Technologies, Inc. Marketing $1,068,030
3250 Lacey Rd #10 Partner
Downers Grove, IL 60515
Attn: Gary Jacobs
Email: gjacobs@bpt3.net
6. PSE&G Co Utility $1,038,324
325 County Ave Provider
Secaucus, NJ 07094
Attn: Dennis O'Connor
Tel: 973-445-1518
Email: dennis.oconnor@pseg.com
7. EMC Corporation Trade $840,234
176 South Street
Hopkinton, MA 01748
Attn: Pat Forti
Tel: 610-809-9096
Email: pat.forti@dell.com
8. Microland Limited Trade $799,797
1B Ecospace Outer Ring Road
Bellandur, 560103 India
Attn: Deepanjan Biswas
Tel: +44(0)77 2525 7948
Email: DEEPANJAN.BISWAS@MICROLAND.COM
9. Vertiv Corporation Trade $791,784
1050 Dearborn Drive
Columbus, OH 43085
Attn: Heather Hill
Tel: 614-216-9390
Email: heather.hill@vertiv.com
10. Veritas Technologies LLC Trade $684,974
2625 Augustine Dr,
Santa Clara, 95054
Attn: Angelo Sciascia
Tel: 917-655-7303
Email: angelo.sciascia@veritas.com
11. LJS Electrical Contractor, Inc. Trade $675,943
430 Commerce Blvd, Unit C
Carlstadt, NJ 07072
Attn: Larry J. Smith
Tel: 201-729-2146
Email: lsmith@ljselectric
12. Presidio Network Solutions Inc. Marketing $644,270
One Penn Plaza, Suite 2501 Partner
New York, NY 10119
Attn: Ryan Fisher
Tel: 610-684-2915
484-919-9692
Email: ryanfisher@presidio.com
13. Element Critical Trade $605,816
7990 Quantum Drive
Vienna, VA 22182
Attn: Shane Menking
Email: smenking@elementcritical.com
14. 1500 Net-Works Associates, L.P. Landlord $560,092
c/o Amerimar Enterprises, Inc.
210 West Rittenhouse Square, Suite 1900
Philadelphia, PA 19103
Attn: Sophia Kimmey
Tel: 646-627-7289
646-553-5641
Email: skimmey@thenggroup.com
15. Sykes Enterprises Inc. Trade $558,187
700 Parkway Global Park,
Main Building
La Aurora Heredia,
517-4005 Costa Rica
Attn: Alexander Baltodano
Tel: +506 2298 2347
Email: alexander.baltodano@sykes.com
16. Russo Family Limited Landlord $509,847
Partnership
c/o Russo Development, LLC
570 Commerce Blvd
Carlstadt, NJ 07072
Attn: Adam Pasternack
Tel: 201-487-5657 X229
Email: apasternack@russodevelopment.com
17. Redwood DC Assets LLC Landlord $460,965
180 Peachtree Street, Suite 610
Atlanta, GA 30303
Attn: Danielle McKinney
Tel: 404-525-8190
Email: daniellemckinney@mapletree.com.sg
18. Landmark Infrastructure Landlord $403,471
Partners LP LLC
400 N. Continental Blvd, Suite 500
El Segundo, CA 90245
Attn: Josef Bobek
Tel: 310-464-3172
Email: jbobek@landmarkdividend.com
- and -
Attn: Valerie Silva
Tel: 801-200-2587
Email: vsilva@landmarkdividend.com
19. Hatzel & Buehler, Inc. Trade $382,795
PO Box 7499
Wilmington, DE 19803
Attn: Robin Villavicencio
Email: r.villavicencio@hatzelandbuehler.com
20. 410 Commerce Landlord $353,748
570 Commerce Blvd
Carlstad, NJ 07072
Attn: Adam Pasternack
Tel: 201-487-5657x229
Email: apasternack@russodevelopment.com
21. Amazon Web Services Trade $346,630
410 Terry Avenue North
Seattle, WA 98109
Attn: George Sophy
Email: sophyg@amazon.com
22. NSC Global, LLC Trade $325,109
West Building 1
London Bridge, 3rd Floor
London, SE19BG UK
Attn: Neil Newing
Tel: +44(0)77-7615-0594
Email: niel.newing@nscglobal.com
23. 760 Washington Avenue LLC Landlord $322,256
c/o Russo Development LLC
570 Commerce Blvd
Carlstadt, NJ 07072
Attn: Adam Pasternack
Tel: 201-487-5657 X229
Email: apasternack@russodevelopment.com
24. Emcor Services (Fluidics) Trade $291,009
9815 Roosevelt Blvd #A
Philadelphia, PA 19114
Attn: Mike Iacobucci
Email: miacobucci@fluidics.com
25. DI Propco LLC Landlord $288,469
c/o Landmark Dividend LLC
400 N. Continental Blvd, Suite 500
El Segundo, CA 90245
Attn: Josef Bobek
Tel: 310-464-3172
Email: jbobek@landmarkdividend.com
- and -
Attn: Valerie Silva
Tel: 801-200-2587
Email: vsilva@landmarkdividend.com
26. DataCenters.com Marketing $282,754
10333 E Dry Creek Rd, Partner
Suite 430
Englewood, CO 80112
Attn: Joel St Germain
Tel: 303-880-1390
Email: joel@datacenters.com
27. Software One, Inc. Trade $272,146
20875 Crossroads Circle, Suite #1
Waukesha, WI 53186
Attn: Jason Shapot
Tel: 610-873-2328
Email: jason.shapot@softwareone.com
28. NET2Vault, LLC Trade $258,487
4900 SW Griffith Drive, Suite 275
Beaverton, OR 97005
Attn: Liz Maguire
Tel: 503-445-8282
Email: liz@net2vault.com
29. M.F. Malone, Inc. Trade $229,262
1043 Gen Lafayette Blvd
West Chester, PA 19382
Attn: Colin Malone
Tel: 610-793-2733
Email: colin.malone@mfmalone.com
30. Microsoft Corporation Trade $222,240
One Microsoft Way
Redmond, WA 98052
Attn: Chris Daniels
Tel: 610-240-7119
Email: cdaniels@microsfot.com
SUNGARD AS: Seeks Cash Collateral Access, $336M DIP Loan
--------------------------------------------------------
Sungard AS New Holdings, LLC and its debtor-affiliates ask the U.S.
Bankruptcy Court for the Southern District of Texas, Houston
Division, for authority to, among other things, use cash collateral
and obtain postpetition financing.
The Debtors seek access to the DIP Facilities comprising of:
a. An ABL DIP Facility consisting of a $50,000,000 senior
secured revolving credit facility syndicated by PNC Bank, National
Association, as administrative agent and collateral agent. Upon
entry of the Interim Order, Prepetition ABL Obligations (including
letters of credit) will be converted, on a dollar-for-dollar basis,
into new postpetition loans or commitments as prepetition
receivables upon which the ABL DIP Liens have priority. In
addition, any Prepetition ABL Obligations that remain outstanding
as of the entry of the Final Order will also, under the proposed
terms of the ABL DIP Facility, be automatically converted into
postpetition loans or commitments.
b. A Term Loan DIP Facility comprising up to $285,900,000 of
senior secured multi-draw term loans, syndicated by SRS Acquiom,
Inc. as Term Loan DIP Agent. The Facility consists of (i) up to
$95,300,000 in new money loans and (ii) subject to entry of the
Final Order, a roll up of up to $190,600,000 of Prepetition 1L Term
Loan Obligations and Prepetition 2L Term Loan Obligations on a
cashless dollar for dollar basis.
The Debtors' industry headwinds have been compounded by, among
other things, the onset and prolonged duration of the COVID-19
pandemic, overmarket lease obligations both in North America and
the UK, and rapidly rising power costs in the UK. These challenges
compelled the Debtors' UK affiliate Sungard Availability Services
(UK) Limited to commence an administration process under UK law on
March 25, 2022. In connection therewith, the Debtors made the
difficult decision to provide financial support for Sungard AS UK's
administration process in order to maintain the overall stability
of their worldwide business and preserve their international
customer base. Funding the UK administration process, however, left
the Debtors themselves with limited resources to commence an
orderly chapter 11 process. In order to ensure that the Debtors had
adequate runway to prepare for these cases and make critical
payments to vendors, employees and professionals, the Debtors
obtained the $7,000,000 Prepetition Bridge Facility on April 7,
2022. The Prepetition Bridge Facility was provided by certain of
the Term Loan DIP Lenders and was provided on the condition that
the Debtors seek authorization at the interim hearing held on the
Motion to use a portion of the Interim Term Loan DIP Amount to
repay the Prepetition Bridge Facility in full.
The Debtors seek approval of the DIP Facilities and authorization
to utilize cash collateral to fund the cases and to implement the
restructuring transaction outlined in the restructuring support
agreement executed substantially contemporaneously with the
commencement of these cases.
In exchange for their consent to (i) the priming of the Prepetition
Term Loan Liens by the Term Loan DIP Liens, (ii) the priming of the
Prepetition ABL Liens by the ABL DIP Liens and (iii) the use of
cash collateral to the extent set forth in the Interim Order, the
Prepetition Secured Parties will receive adequate protection to the
extent of any Diminution in Value of their interests in the
Prepetition Collateral, including:
a. Adequate protection claims to the Prepetition ABL Agent,
the Prepetition 1L Agent and the Prepetition 2L Agent entitled to
superpriority expense status;
b. Adequate protection liens in accordance with the Priority
Schedule under Liens and Priorities, above; and
c. Payment of fees and expenses of the Prepetition ABL Agent
and Prepetition 1L Agent.
Access to the DIP Facilities will allow the Debtors to strengthen
their cash position immediately, and will send a positive, and
credible, message to the Debtors' workforce and commercial
counterparties that the Debtors will have sufficient liquidity to
maintain ordinary course operations and meet their financial
commitments throughout the course of the Chapter 11 Cases.
The ABL DIP Facility matures on the effective date of any chapter
11 plan for the reorganization of any Debtor or the consummation of
any sale or other disposition of all or substantially all of the
assets of the Debtors.
The Term Loan matures 120 calendar days after the Petition Date,
subject to no more than two extensions of 30 days each.
A copy of the motion is available at https://bit.ly/3jyr88B from
PacerMonitor.com.
About Sungard AS New Holdings, LLC
Sungard AS New Holdings, LLC and affiliates provide disaster
recovery services, colocation and network services, cloud and
managed services and workplace recovery to customers in North
America, Europe and Asi. The Debtors sought protection under
Chapter 11 of the U.S. Bankruptcy Court (Bankr. S.D. Tex. Case No.
22-90018) on April 11, 2022. In the petition signed by Michael K.
Robinson, as chief executive officer and president, the Debtor
disclosed up to $1 billion in both assets and liabilities.
Matthew D. Cavenaugh, Esq., at Jackson Walker LLP is the Debtor's
counsel.
TARINA TARANTINO: Seeks Chapter 11 Bankruptcy Protection
--------------------------------------------------------
Real estate company Tarina Tarantino Management LLC filed for
chapter 11 protection.
Tarina disclosed $18.18 million in total assets against $8.318
million in liabilities. It says that its commercial real property
located at 908-910 S. Broadway, in Los Angeles, California,
comprising 26,688 square feet, is worth $16 million.
According to court filings, Tarina Tarantino estimates between 1
and 49 unsecured creditors, including Allen Matkins LeckGamble
Mallory & Natsis LLP, Sheppard MullinRichter & Hampton, and CBRE.
The petition states funds will be available to Unsecured
Creditors.
A telephonic meeting of creditors under 11 U.S.C. Sec. 341(a) is
slated for May 9, 2022, at 9:00 a.m. at Office of UST.
About Tarina Tarantino Management
Tarina Tarantino Management LLC is the 100% owner of a commercial
real property located at 908-910 S. Broadway, Los Angeles, CA,
having a current value of $16 million.
Real estate company Tarina Tarantino Management filed for chapter
11 protection Bankr. C.D. Cal. Case No. 22-11910) on April 5, 2022.
In the petition signed by Alfonso Campos, as president, Tarina
Tarantino Management LLC listed estimated assets amounting to
$18,181,129 and estimated liabilities amounting to $8,317,564. The
case has been assigned to Barry Russell. David B Golubchik, of
Levene, Neale, Bender, Yoo & Golubchik LLP, is the Debtor's
counsel.
TEA STATION: Unsecured Creditors to Split $64K in Subchapter V Plan
-------------------------------------------------------------------
Tea Station Investment, Inc., et al., submitted a Second Amended
Joint Subchapter V Chapter 11 Plan dated April 5, 2022.
Post-petition, Tea Station, Inc. reopened its operations. By
multiple Court-approved stipulations], Tea Station, Inc. and
landlord Chen Chen Plaza, LLC ("Chen Chen") stipulated to a
reduction of rent for the property located at 158 W. Valley Blvd.
San Gabriel, CA 91776 ("San Gabriel Property"). The Debtor turned
the San Gabriel Property over to Chen Chen as of March 27, 2022,
and has rejected the remainder of the lease pursuant to stipulation
which expected to be filed concurrently with this Plan.
Commencing April 1, 2022, Tea Station, Inc. entered into a new
lease (pending Court approval) with Elite Orchid Investments, LLC
for the retail space located at 5700 Rosemead Blvd, Suite 102,
Temple City, CA 91780.
As part of Tea Station, Inc.'s reopening, it borrowed a total of
$100,000 from Elite Orchid Investments, LLC ("Elite Orchid") on an
unsecured basis. This additional funding will not affect Elite
Orchid's claims in Class 3 of this Plan. This funding was approved
by the Court.
Debtors' objection to Baodi Zhou's claims resulted in the
elimination of her class action claim and her $400,000 priority
unsecured claim, which would have otherwise used up all proceeds
remaining after payment of chapter 7 and chapter 11 administrative
claims, as well as the reduction of her general unsecured claim
from over $7 million to $183868.10. 4 –in a chapter 7
liquidation, there would be no projected income whatsoever to pay
to creditors, whereas under the Plan, general unsecured claims will
be receiving their pro rata share of $64,083.54.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $13,477.53. The final Plan
payment is expected to be paid on the Effective Date, which is
projected to be June 1, 2022.
Pursuant to the projections, the Debtors anticipate having a total
of $144,201.66 in cash on hand as of the effective date. A total
$114,402.59 will be paid to creditors under the Plan ($40,000
estimated to administrative legal creditors, estimated $10,000 in
Subchapter V fees, $319.05 to priority tax creditors, and
$64,083.54 to general unsecured creditors (including $5,057.00 in
new value being provided by Yu-Liang Huang.
Class 3 consists of all non-priority unsecured claims. Total
estimated amount of allowed Class 3 general unsecured claims is
$2,330,310.67. This includes the total amount of Zhou's claim,
allowed in the amount of $183,868.10, pursuant to the Court's
order. Class 3 creditors will receive their pro rata share of
$64,083.54 on the Effective Date. The amount being paid to Class 3
creditors includes $5,057 being contributed by the Debtors'
principal, Yu-Liang Huang.
The Debtors have appealed the attorney's fees portion of the Zhou
Claim, which represents $168,766.25 or 91.8% of the Zhou Claim.
Accordingly, the Debtors will be withholding 91.8% of Zhou's pro
rata payment on her Class 3 claim until the appeal is determined or
resolved.
Class 3 claims are impaired, and will be paid their pro rata share
of $64,083.54, resulting in a payout of 2.75 % of their claims.
Class 3 claims will be paid in cash, upon the Effective Date of
this Plan. an. The Debtors have appealed the attorney's fees
portion of the Zhou Claim, which represents $168,766.25 or 91.8% of
the Zhou Claim. Accordingly, the Debtors will be withholding 91.8%
of Zhou's pro rata payment on her Class 3 claim until the appeal is
determined or resolved.
The Plan will be funded from funds on hand with the Debtors on the
Effective Date. The Debtors estimate that they will have
$144,201.66 in cash on hand.
General unsecured claims will be paid their pro-rata share of
$64,083.54 in cash upon the effective date of this Plan, except
that a portion of the distribution representing the appealed
portion of the Zhou Claim shall be withheld pending resolution of
the appeal.
As demonstrated, the $64,083.54 being paid to general unsecured
creditors will exceed the total amount of projected disposable
income for the Debtors during the 3-year period from the effective
date, and is therefore is fair and equitable pursuant to 11 U.S.C.
§1191(c)(2).
A full-text copy of the Second Amended Plan dated April 5, 2022, is
available at https://bit.ly/3rjKz9u from PacerMonitor.com at no
charge.
Attorneys for Debtors:
Leslie A. Cohen, Esq.
J'aime Williams Kerper Esq.
LESLIE COHEN LAW, PC
1615-A Montana Avenue
Santa Monica, CA 90403
T: 310.394.5900
F: 310.394.9280
E-mail: Leslie@Lesliecohenlaw.com
Jaime@Lesliecohenlaw.com
About Tea Station Investment
Tea Station Investment Inc. and its affiliates operate tea shops.
Tea Station Investment Inc. filed a Chapter 7 voluntary petition
(Bankr. C.D. Cal. Case No. 20-14175) on May 4, 2020. On July 1,
2020, the court issued an order converting the case to one under
Chapter 11.
On Sept. 1, 2020, Tea Station Investment's affiliates including Tea
Station Inc., Tea Creations Inc., Tea City Inc., Tea Hut Inc., Tea
Station Operation Inc., Tea Island Inc., and Tea Professor Inc.
sought protection under Chapter 11 of the Bankruptcy Code. The
cases are jointly administered under Case No. 20-14175.
Tea Station Investment's affiliates reported estimated assets of
between $100,001 and $500,000 and liabilities of between $500,001
and $1 million.
Judge Neil W. Bason oversees the cases.
Leslie Cohen Law, PC serves as the Debtors' bankruptcy counsel.
TELIGENT INC: Chapter 11 Plan Will Pay Ares Capital $32.6 Million
-----------------------------------------------------------------
James Nani, writing for Bloomberg Law, reports that generic drug
maker Teligent Inc. proposed a Chapter 11 plan to liquidate
following an asset sale and pay its creditors a fraction of what
they're owed.
The Buena, New Jersey-based company would pay $32.6 million to
affiliates of its chief lender Ares Capital Corp., under a proposed
confirmation plan filed on Friday, April 8, 2022. That would be
36% of Ares' $90.2 million in estimated claims against the company,
the proposal said.
Unsecured creditors would recover $1.5 million of an estimated $14
million in claims, according to the Plan's disclosure statement.
About Teligent Inc.
Teligent, Inc., a specialty generic pharmaceutical company,
develops, manufactures and sells generic topical, branded generic,
and generic injectable pharmaceutical products in the United States
and Canada. The company was formerly known as IGI Laboratories,
Inc. and changed its name to Teligent, Inc. in October 2015.
Teligent was founded in 1977 and is based in Buena, N.J.
Teligent and three affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 21-11332) on Oct. 14, 2021. The cases are
handled by Honorable Judge Brendan Linehan Shannon.
As of Aug. 31, 2021, Teligent had total assets of $85 million and
total debt of $135.8 million.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP as
bankruptcy counsel; K&L Gates, LLP as special corporate counsel;
Raymond James & Associates, Inc. as investment banker;
PharmaBioSource Realty, LLC as real estate consultant; and Portage
Point Partners, LLC as restructuring advisor. Vladimir Kasparov of
Portage Point Partners serves as the Debtors' chief restructuring
officer. Epiq Corporate Restructuring, LLC is the claims and
noticing agent and administrative advisor.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors in the Debtors' cases on Oct. 27, 2021. Jenner
& Block, LLP and Saul Ewing Arnstein & Lehr, LLP serve as the
committee's bankruptcy counsel. Province, LLC is the committee's
financial advisor.
Latham & Watkins LLP, serves as co-counsel to the Prepetition First
Lien Parties and the Senior DIP Parties. Morgan Lewis & Bockius
LLP serves as co-counsel to the DIP Junior Term Loan Parties and
Prepetition Second Lien Parties. Morris, Nichols, Arsht & Tunnell
LLP serves as co-counsel to the DIP Parties and Prepetition Secured
Parties. Jenner & Block LLP serves as co-counsel to the Creditors'
Committee. Osler, Hoskin & Harcourt LLP, serves as Canadian
counsel to both the DIP Junior Term Loan Parties and the Senior DIP
Parties. NautaDutilh Avocats Luxembourg S.a r.l., as Luxembourg
serves as counsel to both the DIP Junior Term Loan Parties and the
Senior DIP Parties. TGS Baltric is the Estonian counsel to both
the DIP Junior Term Loan Parties and the Senior DIP Parties.
TOP LINE GRANITE: Wins Interim Cash Collateral Access
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of Massachusetts
authorized Top Line Granite Design Inc. to use cash collateral on
an interim basis in the ordinary course of its business in
accordance with the budget.
The Debtor is permitted to use cash collateral to pay all
reasonable expenses necessary to maintain and continue usual
business operations to avoid immediate and irreparable harm.
These entities assert liens on the Debtor's assets:
Secured Creditors/
Lienholders Claim Amount
------------------ ------------
Enterprise Bank and Trust $23,936
Company (2007 loan
agreement)
Avidia Bank (equipment loan) $1,086,438
Term Note dated 8/28/19
Avidia Bank (inventory loan/ $1,455,643
revolving line of credit)
Revolving Demand Note
dated 8/28/19
ENG Commercial Finance $317,387
2020 (loan agreement)
US Small Business $500,000
Administration (loan
agreement dated 1/6/2021 and
amended 8/2/21)
Several other creditors, including those with certain Cash Advance
Agreements, have also filed UCC-1 financing statements against
assets of the Debtor with balance totaling $],267,072.
As adequate protection, the Lienholders are granted post-petition
replacement liens and security interests in property of the
Debtor's estate, to the extent of valid perfected security
interests as of the Petition Date not subject to avoidance, in an
amount equivalent to the amount of cash collateral expended by the
Debtor, of the same type, in the same nature and to the same extent
as the Lienholders had in such assets pre-petition to the extent
the Lienholders held validly perfected and unavoidable liens and
security interests as of the Petition Date.
The Post-petition Liens will only secure the amount of any
diminution in the value of the Lienholders' prepetition collateral
constituting cash collateral resulting from the Debtor's use
thereof in the operation of the Debtor's business in the
Post-petition Period.
The Post-petition Liens will have the same priority, validity, and
enforceability as the Lienholders' liens on their pre-petition
collateral.
As further adequate protection, to the extent funds are available,
the Debtor may be authorized in a final order approving the use of
cash collateral to make monthly adequate protection payments to the
Lienholders as set forth in the Motion and in the Budget.
The final hearing on the matter is scheduled for April 28, 2022 at
3:30 pm by telephone.
A copy of the order is available at https://bit.ly/3KpMNLR from
PacerMonitor.com.
About Top Line Granite Design Inc.
Top Line Granite Design Inc. is a manufacturer of cut stone and
stone products. Top Line offers a selections of kitchen granite,
marble and quartz. Top Line sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D. Mass. Case No. 22-40216) on
March 25, 2022. In the petition signed by Edmilson Ramos,
president, the Debtor disclosed up to $10 million in assets and up
to $50 million in liabilities.
Alan L. Braunstein, Esq., at Riemer and Braunstein LLP is the
Debtor's counsel.
TRI-WIRE ENGINEERING: JPM Settlement-Based Plan Backed by Committee
-------------------------------------------------------------------
Tri-Wire Engineering Solutions, Inc., and its Official Committee of
Unsecured Creditors submitted a Liquidating Plan and a
corresponding Disclosure Statement.
The Plan is a liquidating plan, and does not contemplate the
financial rehabilitation of the Debtor or the continuation of its
business. The liquidation of the Debtor's estate has been
accomplished principally through a sale of the Debtor's business as
a going concern: the Debtor sold its business on October 30, 2021
to ITG Communications, LLC ("ITG") for $8.8 million (the "Sale").
Pursuant to the Bankruptcy Court order authorizing the sale, the
proceeds remaining after the establishment of certain reserves and
the payment of cure costs and expenses of sale were distributed to
JPMorgan Chase Bank, N.A. ("JPM"), the Debtor's senior secured
creditor.
The Plan provides, among other things, for the creation of a
creditor trust for the benefit of the Debtor's general unsecured
creditors (the "Creditor Trust"), and the appointment of a
liquidating trustee (the "Creditor Trustee") to administer the
Creditor Trust assets for the benefit of such creditors. Chief
among the Creditor Trust assets are claims and causes of action
against third parties, principally those that the estate holds
against the Debtor's former sole stockholder, president and chief
executive officer, John R. Wade III ("Wade"), arising out of the
transaction (the "ESOP Transaction") in which he sold 820,000
shares of his stock in the Debtor to the Tri-Wire Employees Stock
Option Trust (the "ESOP Trust") for $20.5 million in cash on
December 30, 2016.
Funding for the Creditor Trustee's pursuit of the Creditor Trust
causes of action has been secured through an agreement among the
Debtor, the Committee, and JPM approved by the Bankruptcy Court on
March 3, 2022. Recoveries from these actions, if any, will be
distributed to the Debtor's general unsecured creditors holding
allowed claims against the bankruptcy estate—and corresponding
beneficial interests in the Creditor Trust—in the manner set
forth in the Plan. The amount of the distributions ultimately paid
will depend on the amount of any recoveries from the pursuit of the
estate's causes of action and any avoidance actions, the duration
of time needed to resolve any such actions, the manner in which
unresolved and disputed claims are resolved and allowed, and the
magnitude of expenses incurred to implement the Plan and administer
the Creditor Trust. The timing and amount of distributions that may
be made by the Creditor Trustee cannot be predicted with any
certainty as of the date of this Disclosure Statement.
Among its terms, the DIP Financing Order (i) approved the Debtor's
waiver and release of any and all claims against JPM, including
without limitation claims relating to the validity and
enforceability of its liens and security interests on the Debtor's
assets, with such waiver binding on the Debtor's estate except as
provided in the DIP Financing Order, and (ii) established a
deadline of October 29, 2021 (as later extended for the Committee,
the "Investigation Termination Deadline") by which the Committee
(and, until October 29, 2021, other non-Debtor entities) could
investigate and assert potential claims and causes of action
against JPM. In its investigation, the Committee focused on JPM's
role in financing the ESOP Transaction; based on its review, the
Committee asserted that the ESOP Transaction was a form of
leveraged buy-out in which the Debtor received no benefit in
exchange for the liens and security interests granted to JPM, such
that JPM's liens and security interests might be avoided as
fraudulent transfers. JPM disputed the Committee's theory of
recovery on multiple grounds, including without limitation on the
basis that its claims are barred by applicable statutes of
limitations.
The Committee and JPM, together with the Debtor, ultimately
resolved the Committee's claims by reaching an agreement (the "JPM
Settlement Agreement"), approved by order of the Bankruptcy Court
on March 3, 2022, containing the following principal terms:
(a) The payment by JPM of $500,000 to an escrow to be used to
fund the Plan – specifically, to finance continuing litigation
against Wade (the "Wade Litigation"), as well as the possible
pursuit of other claims (described below) against third parties and
claims arising under Chapter 5 of the Bankruptcy Code (together
with the Wade Litigation, the "Estate Causes of Action").
(b) Of JPM's claim remaining after its receipt of its share of
the Sale proceeds (the "JPM Deficiency Claim"), $4,003,879 (the
"JPM Subordinated Claim") shall be subordinated to the claims of
the Debtor's general unsecured creditors, thus improving the
likelihood of a material distribution from any recoveries received
on account of the Estate Causes of Action (collectively, the
"Recoveries").
(c) The distribution of net proceeds of Recoveries ("Net
Proceeds") to holders of allowed general unsecured claims, as
follows: (i) of the first $1,500,000 of Net Proceeds, 80 percent
will be distributed to the non-JPM holders of such claims, and 20
percent will be distributed to JPM; and (ii) 100 percent of Net
Proceeds in excess of $1,500,000 will be distributed to holders of
general unsecured claims (including the JPM Distribution Claim, as
defined below) until their claims are paid in full, after which any
remaining Net Proceeds (if any) will be distributed to JPM until
the JPM Subordinated Claim is paid in full.
(d) For purposes of calculating distributions of Net Proceeds,
the "JPM Distribution Claim" shall be equal to $7,452,911, an
amount which includes the Letter of Credit Exposure as well as
amounts loaned to the Debtor under its working capital line of
credit with JPM. This amount will be adjusted to the extent that
the Letter of Credit Exposure is reduced in the future, either
through the expiration or reduction of the Letters of Credit, or
the return to the JPM of the proceeds drawn under any of the
Letters of Credit.
(e) All claims respecting the validity, extent, and priority of
the indebtedness held by JPM, the and the liens and security
interest securing those loans, will, upon the occurrence of the
effective date of the JPM Settlement Agreement, be deemed waived
and released, and JPM's liens and security interests will be
otherwise deemed confirmed as perfected, enforceable and
non-avoidable liens and security interests.
(g) JPM agreed to vote all of its claims to accept the Plan and
support confirmation of the Plan if the Plan does not contain any
provisions materially inconsistent with the JPM Settlement
Agreement.
The JPM Settlement Agreement is the centerpiece of the Plan, and is
of great benefit to the Debtor's creditors. It makes available
$500,000 to fund the Creditor Trust (and through the Creditor
Trust, the prosecution of the Estate Causes of Action), an amount
which would otherwise be retained by JPM on account of its
first-priority secured claim. The Debtor and the Committee believe
that the Debtor's claims—in particular, its claims against
Wade—have the potential to generate significant funding for
distribution to the Debtor's unsecured creditors; such
distributions would simply not be available without the litigation
funding provided for in the JPM Settlement Agreement. Equally
important, the JPM Settlement Agreement provides for the
subordination of a substantial portion of the JPM Deficiency Claim,
thus enhancing the possibility that the Recoveries from the Estate
Causes of Action will be sufficient to generate meaningful
distributions to the Debtor's unsecured creditors pursuant to the
Plan and the Creditor Trust.
The Debtor has ceased all business operations and, through the
Sale, has liquidated its operating assets. At this juncture, the
Debtor's principal assets are cash and the Estate Causes of
Action—the principal such Estate Cause of Action being the Wade
Litigation. The Plan provides for the Estate Causes of Action,
together with the $500,000 provided by the JPM Settlement Agreement
to fund their prosecution (collectively, the "Creditor Trust
Assets"), to be transferred to the Creditor Trust (a liquidating
trust established for the benefit of the holders of Allowed Claims
in Class Seven) to be administered by the Creditor Trustee. In
administering the Creditor Trust, the Creditor Trustee will pursue
those of the Estate Causes of Action that it determines are
appropriate for further prosecution, object to claims that appear
to be invalid or overstated, and make distributions to holders of
Claims in Class Seven on account of their Allowed Claims against
the Debtor. The failure of this Disclosure Statement, or of the
Plan, to specifically identify any Estate Cause of Action shall not
vitiate the power, right, and authority of the Creditor Trustee to
assert and prosecute any and all Estate Causes of Action, all of
which are to be transferred to the Creditor Trust pursuant to the
Plan.
There are five Classes of General Unsecured Claims under the Plan,
as follows:
Class Five: Insured Claims-Auto. Class Five consists of Claims
arising from an automobile accident for which the Debtor may be
liable in damages or otherwise. Prior to the Petition Date, the
Debtor arranged for coverage of these Claims through the Insurance
Arrangements-Auto, which policy includes a high deductible
component for which the Debtor is responsible. Liberty Mutual has a
right, under the Insurance Arrangements-Auto, to fund payment of
the Debtor's obligations respecting the deductible, and to be
reimbursed by the Debtor; the Debtor's reimbursement obligation is
secured by the Letters of Credit and certain cash reserves held by
Liberty Mutual. It is expected that, after the Effective Date,
Liberty Mutual will continue to defend the Insured Claims-Auto,
settle and/or pay judgments below the deductible amount with
respect to those Claims, and seek reimbursement of amounts paid
below the deductible amount from the Letters of Credit and the cash
reserves it holds.
Class Five is unimpaired under the Plan. On the Effective Date,
each holder of a Class Five Claim shall retain all such holder's
legal, equitable, and contractual rights and remedies including
without limitation to pursue a recovery through the Insurance
Arrangements-Auto. Holders of Allowed Class Five Claims shall not
otherwise receive or be entitled to receive any payment or property
under the Plan or the Creditor Trust.
Class Six: Insured Claims-WC. Class Six consists of Claims for
damages for which the Debtor has arranged for coverage under the
Insurance Arrangements-WC, including the Massachusetts
Self-Insurance Program. The workers compensation policies issued by
Liberty Mutual and AIG include a deductible component for which the
Debtor is responsible. Liberty Mutual and AIG have a right, under
the WC Policies, to fund payment of the Debtor's obligations
respecting the deductible, and to be reimbursed by the Debtor; the
Debtor's reimbursement obligation is secured by the Letters of
Credit and certain cash reserves held by each of Liberty Mutual and
AIG. It is expected that, after the Effective Date, Liberty Mutual
and AIG will continue to defend the Insured Claims-WC, settle
and/or pay judgments below the deductible amount with respect to
those Claims, and seek reimbursement of amounts paid below the
deductible amount from the Letters of Credit and the cash reserves
they each hold. The Debtor's obligations under the Massachusetts
Self-Insurance Program are administered by the consulting firm
Cannon Cochran Management Services, Inc., and secured by a $500,000
bond issued by Intact Insurance Group USA, LLC.
Class Six is unimpaired under the Plan. On the Effective Date, each
holder of a Class Six Claim shall retain all such holder's legal,
equitable, and contractual rights and remedies including without
limitation to pursue a recovery through the Insurance
Arrangements-WC. Holders of Allowed Class Six Claims shall not
otherwise receive or be entitled to receive any payment or property
under the Plan or the Creditor Trust.
Class Seven: General Unsecured Claims. Class Seven consists of all
General Unsecured Claims that are not Class Five Claims, Class Six
Claims, Class Eight Claims or Class Nine Claims, and includes a
portion of the JPM Claims as set forth in the JPM Settlement
Agreement and the Class Action Claims. Any distribution to holders
of Allowed Class Seven Claims will depend on the amount of the
Recoveries, if any, the outcome of objections to claims, and the
magnitude of expenses incurred to prosecute the Estate Causes of
Action and to administer the Creditor Trust.
Class Seven is impaired under the Plan. On the Effective Date, each
holder of an Allowed Class Seven Claim (including JPM as holder of
the JPM Distribution Claim) shall be deemed to hold its Pro Rata
beneficial interest in the Creditor Trust. In addition, JPM, as
holder of the JPM Subordinated Claim, shall be deemed to hold a
beneficial interest in the Creditor Trust that is subordinate to
the beneficial interests of all other holders of Allowed Claims in
Class Seven. The Creditor Trust Instrument shall provide that
holders of Allowed Class Seven Claims shall receive from CT
Distributable Funds, on account of their beneficial interests in
the Creditor Trust, the following distributions:
* From the Initial Distribution Amount, or any portion thereof, 80%
shall be distributed to holders of beneficial interests in the
Creditor Trust (excluding the JPM Distribution Claim) Pro Rata, and
20% shall be distributed to JPM.
* CT Distributable Funds exceeding the Initial Distribution Amount
shall be distributed Pro Rata to holders of beneficial interests in
the Creditor Trust (including JPM as holder of the JPM Distribution
Claim but excluding the JPM Subordinated Claim) until the aggregate
amount of such distributions is sufficient to repay Allowed Claims
in Class Seven (exclusive of the JPM Subordinated Claim) in full.
* The beneficial interest in the Creditor Trust on account of the
JPM Subordinated Claim shall thereafter be entitled to all
distributions of CT Distributable Funds until the JPM Subordinated
Claim has been paid in full.
* As of the Effective Date, the Class Action Claims shall
constitute contingent, unliquidated Claims whose adjudication and
allowance shall be determined in the Class Action Lawsuit or as
provided in Section 2.3 of the Creditor Trust Instrument, and,
pending such adjudication and allowance, the Class Action Claims
shall be deemed to constitute contingent, unliquidated Claims
having an Allowed Amount of $0.00.
Class Eight: General Unsecured Claims that pursuant to Bankruptcy
Code Section 510(c) are subordinated to other General Unsecured
Claims, but excluding General Unsecured Claims that are
subordinated pursuant to Bankruptcy Code Section 510(b). Class
Eight consists of the Claim of MCRC, after giving effect to the
extinguishment of the liens and security interests securing that
Claim. As noted above, MCRC's Claim arises from its role in
financing the ESOP Transaction, which the Committee has asserted
was a form of leveraged buy-out in which the Debtor received no
benefit in exchange for loan from, and the liens and security
interests granted to, MCRC. Bankruptcy Code Section 510(c) provides
that such claims may be subordinated to the claims of other
creditors.
Class Eight is impaired under the Plan. On the Effective Date, each
holder of an Allowed Class Eight Claim shall be deemed to hold a
contingent Pro Rata beneficial interest in the Creditor Trust that
is (i) subordinated in all respects to the rights of holders of
Allowed Class Seven Claims to receive full payment of such Claims,
and (ii) contingent upon full payment of such Allowed Class Seven
Claims, including without limitation the JPM Subordinated Claim.
Class Nine: Claims that pursuant to Code Section 510(b) are
subordinated to other General Unsecured Claims including General
Unsecured Claims that are subordinated pursuant to Code Section
510(c). Bankruptcy Code Section 510(b) provides for the
subordination of claims for damages arising from the purchase or
sale of a security of the Debtor. Any Claim arising out of the
purchase or sale of the Debtor's equity interests-for example, any
Claim of Wade arising out of the ESOP Transaction-would constitute
a Claim in Class Nine.
Included in Class Nine is the $38,000,000 filed on behalf of the
Tri-Wire Employee Stock Ownership Plan by the U.S. Department of
Labor on November 12, 2021 [Claim Register 34-1]. As Claims held by
the ESOP Trust, if any, arise out of its purchase of the Debtor's
common stock from Wade, this Claim is treated as subordinated to
the Claims of all other creditors, classified as a Class Nine Claim
senior only to the equity interests held by the Trust.
Class Nine is impaired under the Plan. On the Effective Date, each
holder of an Allowed Class Nine Claim shall be deemed to hold a
contingent Pro Rata beneficial interest in the Creditor Trust that
is (i) subordinated in all respects to the rights of holders of
Allowed Class Seven Claims to receive full payment of such Claims
(including without limitation the JPM Subordinated Claim), (ii)
subordinated in all respects to the rights of holders of Allowed
Class Eight Claims to receive full payment of such Claims, and
(iii) contingent upon full payment of such Allowed Class Seven
Claims and Allowed Class Eight Claims.
Counsel to the Debtor:
Michael J. Goldberg, Esq.
A. Davis Whitesell, Esq.
CASNER & EDWARDS, LLP
303 Congress Street
Boston, MA 02210
Tel: (617) 426-5900
E-mail: goldberg@casneredwards.com
Counsel to the Creditors' Committee:
Jeffrey D. Sternklar, Esq.
JEFFREY D. STERNKLAR LLC
101 Federal Street, Suite 1900
Boston, MA 02110
Tel: (617) 207-7800
E-mail: jeffrey@sternklarlaw.com
A copy of the Disclosure Statement dated April 1, 2022, is
available at https://bit.ly/3u9KJlz from PacerMonitor.com.
About Tri-Wire Engineering Solutions
Tri-Wire Engineering Solutions, Inc. -- https://www.triwire.net/ --
provides installation, construction, maintenance and other
technical support services to cable and telecommunications
companies throughout North America. Tri-Wire Engineering was
formed in 1999 and is headquartered in Tewksbury, Mass.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Mass. Case No. 21-11322 on Sept. 13,
2021. In the petition filed by Ruben V. Klein, president, the
Debtor disclosed up to $10 million in assets and up to $50 million
in liabilities.
Casner & Edwards, LLP is the Debtor's counsel. Gentzler Henrich &
Associates LLC is the financial advisor and turnaround consultant.
SSG Advisors, LLC serves as investment banker.
TUPPERWARE BRANDS: S&P Withdraws 'B+' ICR, Outlook Stable
---------------------------------------------------------
S&P Global Ratings has withdrawn its issuer credit rating on
Tupperware Brands (B+/Stable) at the company's request.
Ratings List
RATINGS WITHDRAWN
TO FROM
TUPPERWARE BRANDS CORP.
Issuer Credit Rating NR/-- B+/Stable/--
VERACODE INC: Fitch Assigns 'B' LongTerm IDR, Outlook Stable
------------------------------------------------------------
Fitch Ratings has assigned Long-Term Issuer Default Ratings (IDRs)
of 'B' to Mitnick Parent, L.P. and Mitnick Corporate Purchaser,
Inc. (collectively dba Veracode, Inc.). The Rating Outlook is
Stable. Fitch has also assigned a 'BB-'/'RR2' rating to Veracode's
$75 million secured revolving credit facility (RCF) and $580
million first-lien secured term loan. Fitch is not rating the $235
million second-lien secured term loan. Mitnick Corporate Purchaser,
Inc. is the issuer of the new credit facilities. The proceeds,
along with equity contribution from TA Associates Management, L.P.,
are being used for TA Associates' acquisition of a majority equity
stake from Thoma Bravo.
Veracode's ratings are supported by its leading position in an
emerging and growing area within cyber security. The ratings are
limited by the company's aggressive capital structure.
Fitch has withdrawn the Ratings of Veracode Parent, LP, Valkyr
Purchaser, LLC, and associated credit facilities under Valkyr
Purchaser as the entities are undergoing a reorganization and
ratings will no longer be relevant. Accordingly, Fitch will no
longer provide ratings for Veracode Parent, LP, Valkyr Purchaser,
LLC.
KEY RATING DRIVERS
Secular Tailwind Supporting Growth: The application security
testing market is estimated to grow in the mid-teens CAGR range
through 2023, according to various market research. The vastly
expanding footprint of devices across networks creates increasing
challenges for traditional approaches to network security. Efforts
to secure information and devices are evolving from network
firewalls and end-points security to increasing focus on software
applications to detect vulnerabilities at the software
application-development stage. As application security awareness is
incorporated into the software-development process, providers of
tools for application-security testing should benefit from the
rising demand.
Market Penetration Catalyst for Growth: Fitch believes
application-security testing market growth will be driven by
increasing awareness that rising complexity in networks and devices
would render traditional network-centric solutions insufficient.
While it is widely recognized that reducing software application
vulnerabilities is effective in addressing information security,
best practices in software development are not always followed as
organizations balance development time and resources with best
practices discipline. Continuing market education and regulatory
enforcements are increasing such discipline and demand for greater
emphasis on application security.
Leader in Niche Subsegment: Application-security testing is a niche
market with a few leading suppliers, including Veracode; Synopsys,
Inc.; Checkmarx Ltd; Micro Focus International plc; and WhiteHat
Security, Inc. Veracode's solution was developed as a cloud-based
software-as-a-service solution that supports easy scalability and
implementation. While the industry consists of numerous viable
competing products, Fitch expects customer retention to be high for
the industry as solutions become standard tools within customers'
software-development workflow.
High Revenue Retention Rate and Recurring Revenue: During fiscal
2021, recurring revenue represented over 95% of total revenue and
retention rates remained high. Fitch believes these characteristics
are reflective of a mission-critical product embedded in the
customers' workflow. In conjunction with a subscription revenue
model, these attributes provide strong revenue visibility. The
resilient business model was demonstrated through the coronavirus
pandemic in fiscal 2021 when revenue grew by low-teens, above
Fitch's previous estimates of a high-single digits growth rate.
Diversified Customer Base: During Fiscal 2021 Veracode served over
2,500 customers in the enterprise and midmarket segments, over
1,000 of which were added since 2017. The largest customer
represented less than 5% of total revenue while the top 50
customers contributed to roughly 40% of revenue. Veracode also has
a diverse cross-section of industries served that is representative
of industry verticals that are particularly sensitive to
information security, such as financial services. In Fitch's view,
the diverse set of customers and industry verticals should minimize
idiosyncratic risks that may arise from particular customers or
industries.
Narrow Product Focus: Veracode focuses on the narrow segment of
application security testing. While this is an emerging and growing
segment, the narrow focus could expose the company to risks
associated with the evolving cybersecurity industry including
technology disruptions. Segment growth depends on broader adoption
of application security testing by software-development
organizations.
Elevated Financial Leverage: Fitch estimates gross leverage to be
near 8x in fiscal 2023 and declining to near 7x in fiscal 2024
primarily driven by EBITDA growth. Given the scale and the private
equity ownership of the company, Fitch believes the company is
likely to optimize ROE through acquisitions to accelerate growth or
dividends to the owners while maintaining some level of financial
leverage.
DERIVATION SUMMARY
Veracode operates in the subsegment of application-security testing
within the enterprise-security market that has traditionally
included network firewalls and end-point security. The broader
enterprise-security market has been growing, supported by greater
awareness around security breaches and the increasing complexity of
IT networks and applications. Application security also benefits
from industry secular growth trends. Within the
application-security testing subsegment, Veracode is perceived as
one of the leaders. Within the broader enterprise security market,
peers include NortonLifeLock Inc. (BB+/Stable) and McAfee LLC
(BB-/Stable).
Veracode has smaller revenue scale and lower EBITDA margins than
both NortonLifeLock and McAfee LLC. Veracode also has significantly
higher gross leverage. Fitch also compares Veracode with Sysnopsys,
Inc., a direct peer to Veracode. Synopsys' LTM January 2022 EBITDA
margin (33.4%) is comparable with that of Veracode. However,
Synopsys has a greater revenue diversity as it also has products
beyond application security.
KEY ASSUMPTIONS
Fitch's key assumptions within the rating case for the issuer
include:
-- Organic revenue growth in the high-single-digits;
-- EBITDA margins stable in the 30's;
-- Capex intensity remaining at approximately 3% of revenue;
-- Debt repayment limited to mandatory amortization;
-- Aggregate acquisitions of $100 million through FY2026.
KEY RECOVERY RATING ASSUMPTIONS
-- The recovery analysis assumes that Veracode would be
reorganized as a going-concern in bankruptcy rather than
liquidated;
-- Fitch has assumed a 10% administrative claim.
Going-Concern (GC) Approach
-- In the event of distress, Fitch assumes Veracode would suffer
from greater customer churn and margin compression on lower
revenue scale. Veracode's GC EBITDA is assumed to be $82
million, approximately 15% below estimated FY2022 EBITDA of
$96 million (35% margin). The company has been growing its
revenue scale and benefiting from operating leverage. The
highly recurring revenue and high revenue retention rates
provide significant visibility to future profitability.
-- The GC EBITDA estimate reflects Fitch's view of a sustainable,
post-reorganization EBITDA level upon which Fitch bases the
enterprise valuation.
-- An EV multiple of 7x EBITDA is applied to the GC EBITDA to
calculate a post-reorganization enterprise value. The choice
of this multiple considered the following factors:
-- The historical bankruptcy case study exit multiples for
technology peer companies ranged from 2.6x-10.8x;
-- Of these companies, only three were in the Software sector:
Allen Systems Group, Inc.; Avaya, Inc.; and Aspect Software
Parent, Inc., which received recovery multiples of 8.4x, 8.1x,
and 5.5x, respectively.
-- The highly recurring nature of Veracode's revenue and mission
critical nature of the product support the high-end of the
range.
-- Fitch arrives at an EV of $571 million. After applying the 10%
administrative claim, adjusted EV of $514 million is available
for claims by creditors. This results in a 'RR2' Recovery
Rating for Veracode's first-lien credit facilities.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Fitch's expectation of gross leverage (total debt with equity
credit/operating EBITDA) sustaining below 5.5x;
-- (Cash flow from operations [CFFO]-capex)/total debt with
equity credit ratio sustaining near 7.5%;
-- Operating EBITDA/interest paid ratio sustaining above 2.0x;
-- Organic revenue growth sustaining above the high single
digits.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Fitch's expectation of gross leverage sustaining above 7.5x;
-- (CFFO-capex)/total debt with equity credit ratio sustaining
below 2.5%;
-- Operating EBITDA/Interest Paid ratio sustaining below 1.5x;
-- Organic revenue growth sustaining near or below 0%.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Fitch projects that Veracode's liquidity will
be adequate, supported by its FCF generation and an undrawn $75
million RCF at closing of the transaction and by readily available
cash and cash equivalents. Fitch expects Veracode's cash flow to be
supported by normalized EBTIDA margins in the 30% range.
Debt Structure: Veracode has $580 million of secured first-lien
debt due 2029 and $235 million of secured second-lien debt due
2030. Given the recurring revenue nature of the business and
adequate liquidity, Fitch believes Veracode will be able to make
its required debt payments.
ISSUER PROFILE
Veracode is a provider of application security solutions delivered
through a cloud-based platform and the scale of ancillary and
related services. It helps customers address the acute threat posed
by hackers targeting software vulnerabilities to gain control
overapplications and access critical data.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
VERACODE PARENT: S&P Affirms 'B-' ICR on TA Associates Acquisition
------------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' issuer credit rating on
Veracode Parent L.P. At the same time, S&P assigned its 'B'
issue-level rating on its proposed first-lien debt, with a recovery
rating of '2'.
The outlook is stable, reflecting S&P's expectation that Veracode
will sustain revenue growth in the mid- to
high-single-digit-percent area while modestly improving
profitability and maintaining free cash flow generation to support
high starting S&P Global Ratings-adjusted leverage of around 8x.
TA Associates Management L.P. (TA) has entered into a definitive
agreement to acquire a majority stake in Veracode Parent L.P. from
its existing sponsor, Thoma Bravo, L.P.
Veracode is seeking to raise a new $75 million revolving credit
facility maturing 2027, a $580 million first-lien term loan
maturing 2029, and an unrated $235 million second-lien term loan
maturing in 2030 to finance this transaction.
S&P Global Ratings-adjusted leverage will be high above 7x through
the next 12-24 months, with limited prospects for material
near-term deleveraging. S&P said, "Our 'B-' rating reflects
Veracode's high S&P Global Ratings-adjusted leverage, which we
forecast to be about 8.3x at close and remain above 7x for at least
the next 18 months. The $500 million of incremental debt from this
transaction will also pressure cash generation, with cash interest
expense about $30 million higher per year. Nevertheless, our stable
outlook is based on the expectation that Veracode will continue to
grow revenues and maintain positive cash flow generation, supported
by secular tailwinds in the application security testing (AST)
space. Despite high S&P Global Ratings-adjusted leverage and
increased interest burden, we expect Veracode to generate
meaningful free cash flow of about $55 million-$65 million
annually, with additional liquidity support from its proposed $75
million revolver."
S&P said, "We view Veracode as well positioned to benefit from
secular trends driving demand for application security tools. Over
the last 12 months, Veracode has consistently grown revenues in the
low- to mid-teens-percentage area, driven by demand across the
board in its AST suite. The company's software composition analysis
product line, which identifies open-source and third-party
components in applications to analyze vulnerabilities, continues to
be the fastest-growing segment, albeit still representing a small
portion of total revenues today. As software development becomes
ubiquitous across verticals and prioritizes testing earlier on in
the development lifecycle, and as applications increasingly move to
cloud and become open-source, Veracode is well positioned to gain
share in the expanding AST total addressable market. Nevertheless,
we note that Veracode operates at a small scale in a market that
remains highly competitive and fragmented.
"Operational discipline over the past two years has resulted in
material margin improvements, and we expect Veracode to continue to
pursue profitable growth. S&P Global Ratings-adjusted EBITDA
margins reached 37.5% in the 12 months ended Dec. 31, 2021, up from
32.6% in fiscal 2021 and 21.9% in 2020. The company has gone
through a transformational effort to dedicate its salesforce toward
land and expand opportunities, increase efficiency through product
development and integration, and reduce research and development
(R&D) spending. Additionally, the company's subscription business
model allows for organic margin expansion as it continues to grow
its recurring revenue base. As the company continues to focus on
profitability, we expect revenue growth to be in the 7% area in our
forecast years, with S&P Global Ratings-adjusted margins remaining
stable in the high-30% range.
"The stable outlook on Veracode reflects our expectation that the
company will grow revenues around 7% while modestly improving
profitability and maintaining cash flow generation. We expect the
company's recurring revenue base, which represents about 95% of its
total revenues, to grow with strength in its software-as-a-service
(SaaS) products."
S&P could lower the rating if:
-- Veracode suffers from competitive pressures that lead to market
loss, weaker-than-expected revenue growth, or deterioration in
profitability, thus leading to increased leverage or negative free
cash flow; and
-- It cannot maintain adequate liquidity.
Although unlikely over the next 12 months given Veracode's high S&P
Global Ratings-adjusted leverage, S&P would consider an upgrade if
the company maintains revenue growth and expands EBITDA margins
such that S&P Global Ratings-adjusted leverage remains under 7x and
its free operating cash flow (FOCF) to debt ratio remains above
5%.
ESG credit indicators: E-2, S-2, G-3
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis of the company, as is
the case for most rated entities owned by private-equity sponsors.
We believe Veracode Parent L.P.'s highly leveraged financial risk
profile points to corporate decision-making that prioritizes the
interests of the controlling owners." This also reflects the
generally finite holding periods and a focus on maximizing
shareholder returns.
VERMILION ENERGY: S&P Raises ICR to 'B+' on Strong Credit Measures
------------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on Canada-based
exploration and production (E&P) company Vermilion Energy Inc. to
'B+' from 'B'. At the same time, S&P also raised its issue-level
rating on the company's US$300 million of senior unsecured notes to
'BB-' from 'B+'. Our '2' recovery rating is unchanged.
S&P said, "The stable outlook reflects our expectation that
Vermilion's diversification strategy, supportive commodity prices,
and focus on debt reduction should ensure the company's adjusted
FFO-to-debt ratio remains well above 30% over our forecast period.
"We estimate Vermilion will generate improved credit measures
following the upward revision to our oil and gas price assumptions.
Oil prices have remained on an upward trajectory since early 2021
and while the Russia-Ukraine conflict has spiked them, we believe
global supply and demand fundamentals have strengthened and should
support higher near-term prices. Natural gas prices have also
continued strengthening, with European natural gas prices (TTF;
about a 44% contribution to Vermilion's estimated 2022 cash flows
pro forma the Corrib acquisition) currently elevated, supported by
strong demand and declining domestic production, increasing use of
gas as transition fuel, and uncertainty about Russian gas
dependence.
"Based on these pricing updates, we project the company will
generate an adjusted FFO-to-debt ratio of more than 60% in 2022 and
2023. The improvement is also led by our expectation for further
absolute debt reduction (the company reduced gross debt by C$282
million in 2021) and production increasing to close to 100,000
barrels of oil equivalent (boe) per day by 2023 (pro forma
acquisitions) from 85,000 boe per day in 2021. We also believe
downside risk is limited to an extent given the hedges in place;
Vermilion has hedged more than 50% of its natural gas exposure for
2022 and almost 30% in 2023. Although this limits upside to cash
flow generation, it provides downside cushion in a weak pricing
environment.
"The upgrade also reflects our expectation for continued gross debt
reduction, which should help maintain credit measures commensurate
with the rating on a sustained basis. We believe debt reduction
will remain the key focus for management, as demonstrated during
2021, when the company lowered absolute borrowings under the credit
facility by almost C$300 million. Underpinning this is our
assumption that Vermilion will remain disciplined with its
discretionary spending. The company's 2022 capital budget of C$500
million is well within operating cash flow generation. Also, while
the company has initiated dividends, they remain modest (about C$40
million annually or 5% of FFO) relative to previous periods. To put
into context, it paid out more than C$300 million in annual
dividends during 2018 and 2019.
"Accordingly, we expect Vermilion will generate strong
discretionary cash flows, with 2022 discretionary cash flow
projected at about C$1.3 billion. Although this is largely expected
to fund the Corrib and Leucrotta acquisitions (total of about C$1.1
billion), we assume the company will continue to use excess cash to
reduce borrowings under the credit facility, given its absolute
debt target of C$1.2 billion, which we project it will achieve in
2023 under our pricing assumptions. After that, we believe
management will likely continue to pay down debt to provide
optionality for future acquisitions but is also likely to increase
distributions to shareholders.
"In our view, the lower gross debt and production levels sustained
at an average of 95,000 boe per day provide downside cushion to
absorb commodity price volatility. We believe the company should be
able to maintain the improved financial risk assessment and rating
even under our long-term pricing assumptions of West Texas
Intermediate (WTI) at US$50/barrel (/bbl), AECO at US$2.25 per
million British thermal unit (/mmBtu), and TTF at US$8/mmBtu. Based
on our forecasts, all else equal, we project an FFO-to-debt ratio
of about 45% even under these pricing assumptions. Underpinning
this is our expectation that management will limit discretionary
spending and fund dividends from internal cash flows such that
gross debt does not exceed C$1.2 billion.
"Acquisitions are integral to the company's strategy, but we expect
them to be funded in a leverage-neutral manner. Vermilion's focus
is to maintain relatively flat production, with acquisitions likely
to offset natural declines at existing assets. The recently
announced purchases of a 36.5% interest in the high-margin Corrib
asset In Ireland and a 100% interest in the Leucrotta Montney
assets straddling the British Columbia and Alberta border
demonstrate this approach. The company might continue to make
bolt-on acquisitions in North America (similar to its recent one in
the Powder River Basin for US$76 million), but we believe its focus
remains in Europe for medium-scale acquisitions. That said, we
believe it will make acquisitions in a prudent manner as management
focuses on maintaining moderate debt levels. For instance, we
expect both these assets will be funded within operating cash flow
generation. While Leucrotta will be a modest contributor in 2022,
the Corrib asset is estimated to increase cash flows by 20% in 2022
(based on our commodity price assumptions and assuming a
second-half 2022 close), more than offsetting the impact on
leverage. The asset is also largely de-risked, with 70% of its 2022
and 2023 forecast production hedged. We expect a more meaningful
contribution from Leucrotta in 2023 as the company invests in
infrastructure development and production rises to an estimated
13,000 boe per day.
"Vermilion's diversification strategy supports our current business
risk assessment and 'B+' rating. Our business risk assessment
reflects the company's broad geographic and product
diversification. During 2022, we expect production will be
distributed across the following different products: WTI priced oil
(35%), European gas (22%), North American gas (27%), and Brent
priced oil (16%) --and different regions--North America (62%) and
international, which includes Europe and Australia (38%). In our
view, the diversification provides resilience for maintaining cash
flow generation and credit metrics within our current expectation.
"Our assessment also incorporates the company's profitability
relative to that of peers. We expect Vermilion will continue
generating positive netbacks in each of its operating regions,
given its competitive production costs in each of its upstream
segments. Specifically, the exposure to European gas provides the
company with a significant competitive advantage, given that TTF
prices are currently trading at more than 6x relative to Henry Hub
and AECO pricing. That said, we would like to see Vermilion
demonstrate consistently better profitability metrics (calculated
on a unit earnings before interest per thousand cubic feet basis
over a five-year period), which in our view, could mitigate its
relatively smaller scale (average daily production of about 95,000
boe per day expected in 2022 [51% liquids]) and reserves of about
270 million boe of net proved reserves compared with those of
higher-rated peers.
"The stable outlook reflects our expectation that Vermilion will
generate improved credit measures, with adjusted FFO to debt
averaging more than 60% in 2022 and 2023. The outlook also reflects
our expectation for a stable production profile and continued
adherence to publicly stated debt reduction targets, with the
company achieving absolute unadjusted debt of C$1.2 billion within
our forecast period.
"We could lower the rating during the next 12 months if the
company's average FFO-to-debt ratio declined below 30%, and we
expected it would remain below this threshold, and the company
outspent cash flows, resulting in negative discretionary cash flow
generation. This could occur if there was a meaningful decline in
commodity prices and Vermilion failed to correspondingly lower
discretionary spending.
"Assuming the company can hold production relatively flat at about
90,000-100,000 boe per day, an upside would be contingent on it
demonstrating improvement in its profitability measures relative to
those of peers and continuing to reduce absolute debt as publicly
guided. In this scenario, we would also expect acquisitions to be
funded in a relatively balanced manner while adjusted FFO-to-debt
ratio remains above 45% under our long-term pricing assumptions."
ESG credit indicators: E-4, S-2, G-2
VICTORIA TOWERS: Claims to be Paid From Sale of Property
--------------------------------------------------------
Victoria Towers Development Corp. submitted a Second Amended
Disclosure Statement.
The Debtor filed a voluntary petition for relief pursuant to
chapter 11 of the Bankruptcy Code on October 30, 2020. The Debtor
was designated as a single asset real estate debtor as that term is
understood under the Bankruptcy Code. The Debtor filed for relief
primarily due to the default of its obligations under a note and
mortgage granted in favor of SDF34 Flushing Sanford LLC ("SD34")
and SDF 34 Flushing Sanford II LLC ("SDF34 II") which notes, and
mortgages are currently held by Sanford Avenue Partner, LLC
("Sanford" and collectively with its predecessors in interest the
"Senior Secured Lender") secured by a first in priority lien
against certain of the condominium apartment units (the "Units")1
located at the Debtor's real property commonly known 133-38 Sanford
Avenue, Flushing, New York (the "Real Property") as well as the
personal guarantees of Myint J. Kyaw a/k/a Jeffrey Wu ("Wu"), a
debtor before the Bankruptcy Court and Ioc Heng Ip ("Ip" or
"Veronica Wu").
Recoveries projected in the Plan shall be from the Debtor's sale of
the Units located at the Real Property. The proposed sale of the
Units shall be used to satisfy the claim of the secured creditors
pursuant to the order of priority; the payment of any outstanding
statutory fees due and owing the United States Trustee; the payment
of allowed costs of administration of the case (the "Administrative
Claims"); and a distribution to the holders of Allowed Claims.
The Debtor believes that the recoveries provided for in the
proposed Plan exceed any recovery that would otherwise be available
if Sanford were to foreclose on its interest in the Real Property.
Similarly, the Debtor believes that if this chapter 11 case was
converted to one under chapter 7 of the Bankruptcy Code, the
holders of the Allowed Claims would receive less than the amounts
anticipated in the Debtor's Plan due to the additional
administrative expenses that would necessarily be incurred in such
liquidation.
The Plan provides for the sale of the Debtor's interest in the
Units. Accordingly, the Holder of Ownership Interests in the Debtor
shall be extinguished upon the sale of all of the Units available
for sale. The Debtor shall continue to exist until the completion
of the sale of all available Units. Once all available Units have
been liquidated, the Liquidated Debtor shall cease to exist.
Class 6 Allowed General Unsecured Claims. The Debtor scheduled the
following creditors as holding general unsecured claims as against
the Debtor:
W&L Construction, Inc. was scheduled in an unknown amount. On
December 28, 2020, W&L Construction, Inc. ("W&L") filed a proof of
claim in the amount of $8,670,082.19 (Claim No. 13). Claim No. 13
arises out of work performed by W&L for the Debtor and monies
loaned to or for the benefit of the Debtor and is the subject of a
pending litigation styled W &L Construction Group, Inc., v.
Victoria Towers Development Corp., Victoria Realty Group, LLC,
Victoria Development Realty Corp., and Jeffrey Wu, bearing Index
No. 717487/2018 in the Supreme Court of the State of New York,
County of Queens. Provided that the Debtor fully consummates the
agreement with Sanford as part of the Plan, W&L shall not assert a
claim against the Debtor on account of the work performed in
exchange for a full release of any and all claims upon the
Effective Date of the Plan. The portion of Claim No. 13 related to
the loan shall remain as part of the Individual claims discussed
below. In addition to Claim No. 13, W&L filed a claim in the amount
of $8,445,205.48 against the Jeffrey Wu estate which was assigned
Claim No. 20-1 (the "W&L Wu Claim").
Bai was scheduled in an unknown amount. On December 28, 2020, Bai
filed a proof of claim in the amount of $8,347,300.00 (Claim No.
6), plus costs and expenses as well as damages as of the Petition
Date, related to the settlement agreement described herein and the
purchase of certain units (the "Bai Units") to wit: 8A, 8B, 8C, 8D,
8E, 8F, 8G, 10A, 10C, 10D, 10E and 10F. In addition to Claim No. 6
Bai filed a proof of claim in the amount of $12,378,911.12 in the
Wu case.
In connection with the escrow funds held by Certilman, as described
herein, the amount of $489,340.00 represents funds for the purchase
of the Bai Units, for which transactions had not closed (the "Bai
Escrow Funds"). The Bai Escrow Funds are not property of the
Debtor's bankruptcy estate and are being returned to Bai as part of
the settlement reach with Bai and being implemented as part of the
plan in the Wu chapter 11 case.
Settlement with Bai
The Debtor, Bai and Wu, have reached a global resolution which
resolves Bai's claims in this chapter 11 case and the Wu chapter 11
case. Upon the entry of the Order confirming the Plan, the Escrow
Agent shall be directed and shall release the Bai Escrow Funds in
the amount of $489,340 to Kravit Partners LLC, counsel for Bai, via
check or wire transfer. Upon the entry of an Order approving the
Sanford Stipulation, the Debtor shall execute and deliver to
Certilman any authorization Certilman may require releasing the Bai
Escrow Funds as provided for herein. In the event that the Debtor
fails to deliver the required release to Certilman, after the Order
approving the Sanford Stipulation becomes a final, non-appealed,
non-appealable order, the Escrow Agent shall release the Bai Escrow
Funds without the need for any further order of the Court.
In the event that the Bai Units are sold and transferred as part of
the confirmed Plan to a party other than Sanford, Bai and any other
occupants occupying the Bai Units shall vacate the Bai Units,
leaving said Bai Units vacant and in broom clean condition, by not
later than 30 days from the closing of the proposed sale
transaction.
Upon the entry of the Order confirming the Debtor's Plan, the
Debtor shall be deemed to have released Bai in connection with or
related to Claim No. 6 filed in the Debtor's chapter 11 bankruptcy
case. Provided the Plan is confirmed, Bai shall be deemed to have
withdrawn Claim No. 6 and it shall be deemed satisfied. Bai's claim
in the Wu chapter 11 case shall be treated in accordance with the
Bai Settlement Agreement and shll not be extinguished until Bai is
paid in full. In addition, for the avoidance of doubt, in the event
of that the Debtor's Plan is not confirmed as contemplated or the
Wu plan is not confirmed as contemplated, Claim No. 6 shall revert
to the full amount due and owing and shall be paid in order of
priority upon the liquidation of the Debtor's property.
The claims listed below are claims that have been asserted against
the Debtor and were not scheduled by the Debtor:
Westchester Fire Insurance Company ("Westchester") on December 15,
2020, timely filed Claim No. 2 in the amount of $1,001,130.06. This
claim is alleged to be in connection with the discharge of a
mechanic's lien, however there are no bona fides provided by the
claimant. By motion dated November 5, 2021, the Debtor objected to
this claim. The Debtor's objection is currently sub judice before
the Court. The Debtor has not included this claim in the Allowed
General Unsecured Claims.
Landmark Portfolio Mezz ("Landmark Portfolio") on December 23,
2020, timely filed Claim No. 4 in the amount of $24,876,385.05. The
Debtor has not included this claim in the Allowed General Unsecured
Claims. This claim has been addressed in the Wu bankruptcy case.
Pursuant to a stipulation entered into by and between Wu and
Landmark Portfolio, Landmark Portfolio shall be paid the sum of
$16,500,000.00.
Zhen En Lin ("Lin") on December 28, 2020, timely filed Claim No. 7
in the amount of $453,000 relating to the purchase of a Unit.
Provided that the Plan is confirmed, and Sanford receives the full
amount of the Allowed Sanford Secured Claim in exchange for a
release from the Debtor, Wu and Ip, Lin has agreed that Claim No. 7
shall not participate in any distribution from the Carve Out
described herein. However, in the event that the proposed sale of
both the Sanford Units and/or the Chengyi Sale Units generates
funds in excess of the amounts necessary to pay the Allowed Sanford
Secured Claim and the Chengyi Allowed Secured Claim as well as the
claim of Leser (Class 5) in its entirety, Claim No. 7 shall receive
a pro rata distribution as to the claim.
Xing Mei Ni ("Ni") on December 28, 2020, timely filed Claim No. 8
in the amount of $453,000 relating to the purchase of a Unit.
Provided that the Plan is confirmed, and Sanford receives the full
amount of the Allowed Sanford Secured Claim in exchange for a
release from the Debtor, Wu and Ip, Ni has agreed that Claim No. 8
shall not participate in any distribution from the Carve Out
described herein. However, in the event that the proposed sale of
both the Sanford Units and/or the Chengyi Sale Units generates
funds in excess of the amounts necessary to pay the Allowed Sanford
Secured Claim and the Chengyi Allowed Secured Claim as well as the
claim of Leser (Class 5) in its entirety, Claim No. 8 shall receive
a pro rata distribution as to the claim.
Qui Hui Lin ("Qui Lin") on December 28, 2020, timely filed Claim
No. 9 in the amount of $487,200 relating to the purchase of a Unit.
Provided that the Plan is confirmed, and Sanford receives the full
amount of the Allowed Sanford Secured Claim in exchange for a
release from the Debtor, Wu and Ip, Lin has agreed that Claim No. 9
shall not participate in any distribution from the Carve Out
described herein. However, in the event that the proposed sale of
both the Sanford Units and/or the Chengyi Sale Units generates
funds in excess of the amounts necessary to pay the Allowed Sanford
Secured Claim and the Chengyi Allowed Secured Claim as well as the
claim of Leser (Class 5) in its entirety, Claim No. 9 shall receive
a pro rata distribution as to the claim.
Meng Hua Wang ("Wang") on December 28, 2020, timely filed Claim No.
10 in the amount of $1,880,080 relating to the purchase of 3 Units.
Provided that the Plan is confirmed, and Sanford receives the full
amount of the Allowed Sanford Secured Claim in exchange for a
release from the Debtor, Wu and Ip, Wang has agreed that Claim No.
7 shall not participate in any distribution from the Carve Out
described herein. However, in the event that the proposed sale of
both the Sanford Units and/or the Chengyi Sale Units generates
funds in excess of the amounts necessary to pay the Allowed Sanford
Secured Claim and the Chengyi Allowed Secured Claim as well as the
claim of Leser (Class 5) in its entirety, Claim No. 10 shall
receive a pro rata distribution as to the claim.
Liang Wen Pan ("Pan") on December 28, 2020, timely filed Claim No.
11 in the amount of $786,480 relating to the purchase of a Unit.
Provided that the Plan is confirmed, and Sanford receives the full
amount of the Allowed Sanford Secured Claim in exchange for a
release from the Debtor, Wu and Ip, Pan has agreed that Claim No.
11 shall not participate in any distribution from the Carve Out
described herein. However, in the event that the proposed sale of
both the Sanford Units and/or the Chengyi Sale Units generates
funds in excess of the amounts necessary to pay the Allowed Sanford
Secured Claim and the Chengyi Allowed Secured Claim as well as the
claim of Leser (Class 5) in its entirety, Claim No. 11 shall
receive a pro rata distribution as to the claim.
Hui Lin ("Hui Lin") on December 28, 2020, timely filed Claim No. 12
in the amount of $638,000 relating to the purchase of a Unit.
Provided that the Plan is confirmed, and Sanford receives the full
amount of the Allowed Sanford Secured Claim in exchange for a
release from the Debtor, Wu and Ip, Lin has agreed that Claim No.
12 shall not participate in any distribution from the Carve Out
described herein. However, in the event that the proposed sale of
both the Sanford Units and/or the Chengyi Sale Units generates
funds in excess of the amounts necessary to pay the Allowed Sanford
Secured Claim and the Chengyi Allowed Secured Claim as well as the
claim of Leser (Class 5) in its entirety, Claim No. 12 shall
receive a pro rata distribution as to the claim.
The allowed general unsecured creditors total $17,017,382.19.
However, Claim Nos. 2, 4, 7, 8, 9, 10, 11, 12 and 13 shall not
receive a distribution as described above. Leser shall receive a
distribution as an allowed general unsecured creditor in an amount
not less than $25,000.00 from the Carve Out described supra. Class
6 is impaired.
Attorneys for Victoria Towers Development Corp.:
Fred S. Kantrow, Esq.
THE KANTROW LAW GROUP, PLLC
6901 Jericho Turnpike, Suite 230
Syosset, New York 11791
Tel: (516) 703-3672
E-mail: fkantrow@thekantrowlawgroup.com
A copy of the Disclosure Statement dated April 1, 2022, is
available at https://bit.ly/3NSh7kG from PacerMonitor.com.
About Victoria Towers Development
Flushing, N.Y.-based Victoria Towers Development Corp. is the owner
of fee simple title to 29 residential condo units located at 133 38
Sanford Avenue, Flushing N.Y., having an appraised value of $33.37
million.
Victoria Towers filed a Chapter 11 petition (Bankr. E.D.N.Y. Case
No. 20-73303) on Oct. 30, 2020. In its petition, the Debtor
disclosed $33,370,000 in assets and $39,217,115 in liabilities. The
petition was signed by Myint J. Kyaw, president.
The Hon. Robert E. Grossman presides over the case.
Rosen & Kantrow, PLLC, serves as the Debtor's bankruptcy counsel.
[] New Hampshire Bankruptcy Filings Rose 53% in March 2022
----------------------------------------------------------
Bob Sanders of NH Business Review reports that New Hampshire
bankruptcies jumped in March 2022.
Bankruptcy filings shot up last March 2022 after repeated record
lows, but it's too early to tell whether they have bottomed out and
a new trend is just beginning, or if it’s just a statistical
fluke.
Some 64 individuals and businesses filed for bankruptcy in March, a
53 percent increase over the 42 that were filed in February 2022,
which was one shy of the modern record set in January. But the
March total is still over 30 percent better than March of 2021,
when there were 92 filings, so New Hampshire at this point is still
on track for another record low year.
To put things in perspective, the most monthly filings in the Great
Recession -- 586 -- were filed in March 2010. In fact, you would
have to go back to 1987 to find any March with fewer filings (63).
There were four business-related filings in March, compared to one
in January, but two were filed by individuals with business debt.
The other two businesses filed directly. They were:
* Michelin's Auto Body & Sales Inc., Manchester, filed March 17,
Chapter 7. Assets: $0. Liabilities: $248,098.
* J&B Pizza LLC, d/b/a Juliano's Italian Pizzeria, Londonderry,
filed March 18, Chapter 7. Assets: $0. Liabilities: $404,614.
*********
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.
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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
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Don't be fooled. Assets, for example, reported at historical cost
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assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
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http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Philadelphia, Pa., USA.
Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante,
Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon,
Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and
Peter A. Chapman, Editors.
Copyright 2022. All rights reserved. ISSN: 1520-9474.
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*** End of Transmission ***