/raid1/www/Hosts/bankrupt/TCR_Public/220425.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, April 25, 2022, Vol. 26, No. 114
Headlines
27646 TG: Files Amended Plan; Confirmation Hearing June 7
7 DOLLARS: Files Chapter 11 Bankruptcy Protection
AE OPCO III: Seeks Approval to Hire Doeren Mayhew as Accountant
AGUILA INC: Creditors' Committee Files Liquidating Plan
ALARMAS COMPUTARIZADAS: Reaches BPPR Stipulation; Amends Plan
ALIERA COMPANIES: Creditors' Committee Members Disclose Claims
AMERICAN AXLE: Egan-Jones Retains 'B-' Senior Unsecured Ratings
ANTICANCER INC: Case Summary & 20 Largest Unsecured Creditors
ART VAN: Founder's Family Gets More Time to Respond to Fraud Suit
ARTESIAN FUTURE: Case Summary & 20 Largest Unsecured Creditors
BAUSCH + LOMB: Moody's Gives Ba2 Rating on New Senior Secured Debt
BRINK'S CO: Egan-Jones Retains B+ Sr. Unsecured Debt Ratings
BSPV-PLANO: Wins Cash Collateral Access Thru Aug 26
BUCKHARDT TECHNOLOGIES: Wins Cash Collateral Access Thru May 6
BUSY BEES: Case Summary & Seven Unsecured Creditors
BW HOLDING: Moody's Affirms 'B3' CFR & Alters Outlook to Negative
CALIFORNIA ROOFS: Unsecureds Will Get 2% of Claims over 5 Years
CANADIAN UTILITIES: Egan-Jones Retains 'BB' Sr. Unsecured Ratings
CORESTATE CAPITAL: Creditors Get Debt Restructuring Adviser Pitches
DANA INC: Egan-Jones Retains 'BB-' Sr. Unsecured Debt Ratings
DCIJ BEE HIVE: Court OKs Deal on Cash Collateral Access
DELAWARE VALLEY: Moody's Affirms Ba1 Issuer & Revenue Bond Ratings
DERBY MOBILE: Wins Cash Collateral Access Thru April 30
DIOCESE OF CAMDEN: Danziger Represents Sexual Abuse Claimants
DISCOVERY INC: Egan-Jones Retains BB+ Sr. Unsecured Ratings
DISPATCH ACQUISITION: Term Loan Add-on No Impact on Moody's B3 CFR
EVEREST REAL ESTATE: Taps Haselden Farrow as Co-Counsel
EYP GROUP: Case Summary & 30 Largest Unsecured Creditors
FLEXIBLE FUNDING: Unsecureds' Recovery "TBD" in Liquidating Plan
FORMATION GROUP: Closes Operations After Filing Chapter 11
GML LOGISTICS: Unsecureds Will Get 100% of Claims over 60 Months
GWG HOLDINGS: Angry Bondholders Oppose Bankruptcy
HECLA MINING: Moody's Ups CFR to B1 & Senior Unsecured Notes to B2
HLMC TITLE: Gets Cash Collateral Access Thru May 13
ICAHN ENTERPRISES: Moody's Alters Outlook on 'Ba3' CFR to Stable
IMAX CORP: Egan-Jones Keeps BB- Senior Unsecured Ratings
INDIANA FINANCE: Moody's Rates Series 2022A/B Revenue Bonds 'Ba2'
INFOW LLC: Court Postpones Alex Jones' Trial After Ch.11 Filing
INFOW LLC: DOJ Warns Bankruptcy May Be Abuse of Federal Court
INNERLINE ENGINEERING: Wins Cash Collateral Access Thru Sept 30
J & J CONSULTING: Taps Peter Kravitz of Province Partners as CRO
JADEX INC: Moody's Affirms 'B2' CFR & Alters Outlook to Negative
JCB TRUCKING: Gets Court Nod to Use Cash Collateral
JEM HOMES: Amends Unsecured Creditors Claims Pay Details
JILL ACQUISITION: Moody's Hikes CFR to B3, Outlook Remains Stable
JOYFUL CARE: Unsecureds to Get $2K per Month for 60 Months
KB HOME: Egan-Jones Keeps BB- Senior Unsecured Ratings
KISSIMMEE CONDOS: Taps Shuker & Dorris as Legal Counsel
KURNCZ FARMS: Has Deal on Cash Collateral Access
LAKEVIEW VILLAGE: Fitch Affirms BB+ Rating on 2017A/2018A Bonds
LAMAR ADVERTISING: Egan-Jones Maintains BB- Sr. Unsecured Ratings
LANAI LAND: Seeks Approval to Hire Tran Singh as Legal Counsel
LEAR CAPITAL: Customers Want Official Committee
LINDSAY YORK: Unsecureds Will Get 26% to 32% of Claims in Plan
M 1 INDUSTRIES: Seeks to Hire Prager Metis as Accountant
MACOM TECHNOLOGY: Moody's Ups CFR to B1 & Alters Outlook to Stable
MARVIN KELLER: Case Summary & 16 Unsecured Creditors
MAUSER PACKAGING: Moody's Hikes CFR to B3, Outlook Remains Stable
MEDLINE BORROWER: Fitch Alters Outlook on 'B+' LT IDR to Negative
MID ATLANTIC PRINTERS: Expects to Pay Over 40% to Unsecureds
MINNESOTA ATHLETIC: Case Summary & 20 Largest Unsecured Creditors
MINOTAUR ACQUISITION: Moody's Affirms 'B3' CFR, Outlook Stable
MONTAUK CLIFFS: Files Amendment to Disclosure Statement
NB HOTELS: Files Emergency Bid to Use Cash Collateral
NORDIC AVIATION: Norton, et al. 2nd Update on Secured Lender Group
OCEANEERING INT'L: Egan-Jones Maintains 'B-' Unsec. Debt Ratings
OPTIV INC: Moody's Upgrades CFR & 1st Lien Secured Term Loan to B3
OUTCOMES GROUP: Moody's Affirms B3 CFR & Rates First Lien Loan B3
OUTFRONT MEDIA: Egan-Jones Retains CCC Sr. Unsecured Ratings
OUTTA CONTROL: Seeks to Hire Famulari & Butto as Special Counsel
OWENS & MINOR: Egan-Jones Retains BB- Sr. Unsecured Debt Ratings
RCP VEGA: S&P Raises Issuer Credit Rating to 'B-', Outlook Stable
REAL GRANITE: Unsecureds to Get Share of Income for 36 Months
RECEPTION MEZZANINE: Fitch Assigns First-Time 'B+' IDR
RIVERBED HOLDINGS: Moody's Assigns 'Caa1' CFR, Outlook Negative
SALLY HOLDINGS: Moody's Upgrades CFR & Senior Secured Notes to Ba1
SERVICE KING: Nears Out-Of-Court Deal to Ease Debt
SIMPLY FIT: Unsecured Creditors to Split $40.2K over 60 Months
SIX FLAGS: Egan-Jones Hikes Sr. Unsecured Debt Ratings to CCC+
SM ENERGY: Egan-Jones Cuts Senior Unsecured Debt Ratings to B
SOUTHWESTERN ENERGY: Egan-Jones Hikes Sr. Unsecured Ratings to B
TD SYNNEX: Egan-Jones Maintains BB+ Unsecured Debt Ratings
TEGNA INC: Egan-Jones Retains CCC+ Senior Unsecured Ratings
TOYS "R" US: Creditors' Trust Can't Claw Back the $12 Mil. From UPS
UNIENERGY TECHNOLOGIES: Mayer, HCMP Update on Committee Members
US AIRWAYS: Customers to Appeal Bankruptcy Merger Row to 2nd Cir.
VENCHUR INVESTMENTS: Wins Cash Collateral Access Thru June 2
VERACODE INC: Fitch Lowers Rating on $815MM First Lien Loan to B+
VERACODE: Moody's Lowers New Sr. Secured Term Loan to B3
VERMILION ENERGY: Fitch Gives 'BB-' Rating to $400MM Unsec. Notes
VERMILION ENERGY: Moody's Rates New Senior Unsecured Notes 'B3'
VISTA GLOBAL: S&P Affirms B+ Issuer Credit Rating, Outlook Stable
VOLUNTEER ENERGY: Seeks to Hire GlassRatner as Financial Advisor
VOLUNTEER ENERGY: Taps Isaac Wiles & Burkholder as Local Counsel
VOLUNTEER ENERGY: Taps McDermott Will & Emery as Bankruptcy Counsel
WEI SALES: Moody's Lowers CFR to B2 & First Lien Term Loan to B3
ZARA MANAGEMENT: Loan Proceeds, and/or Property Sale, to Fund Plan
ZOHAR FUNDS: Tilton Sued for Mishandling Sale of Dura Automotive
[^] BOND PRICING: For the Week from April 18 to 22, 2022
*********
27646 TG: Files Amended Plan; Confirmation Hearing June 7
---------------------------------------------------------
27646 T.G., LLC, submitted an Amended Disclosure Statement
describing Amended Plan of Reorganization dated April 19, 2022.
The Chapter 11 was filed to preserve the equity in the Property.
The Debtor plans to satisfy the secured debt against the Property
through a sale of the Property or a refinance of the debt.
Following the filing of Chapter 11, in December 2021, the Debtor
commenced making monthly adequate protection payments to Citywide
Banks in the amount of monthly interest due under the Promissory
Note. Those payments have been made monthly and will continue until
the Loan is paid in full through the sale or refinance of the
Property.
The Debtor has negotiated the provisions of this Plan with Citywide
Banks to reach a consensual Plan.
The Debtor has filed a Motion to Employ Dream Maker Real Estate,
Ltd., dba The McWilliams Group as Real Estate Agent to market the
Property for sale. Since the Property is located in the mountains,
access is difficult in the winter months due to snow. The best time
to market the property for sale is in the summer months. The
Listing Agreement dated April 9, 2022 is from April 9, 2022 through
October 28, 2022.
The Property will be listed at a price of $738,000 which is an
amount the Debtor and Dream Maker Real Estate Ltd dba The
McWilliams Group have agreed to based upon demand, current market
conditions and available properties in Evergreen Colorado. The
Listing Agreement provides that the commission to be charged will
be 6% of the gross selling price with 2.8% of the commission to be
paid to buyers' agents or transaction brokers. In the event the
Property is sold to a customer of Mr. McWilliams and Dream Maker
Real Estate Ltd dba The McWilliams Group, the commission will be
reduced to 4% of the gross selling price.
The Plan provides that the Debtor will have through and including
October 31, 2022, to repay the secured debts owed to Citywide Banks
and the Jefferson County Treasurer through sale or refinance. If
the secured debts are not paid by October 31, 2022, both Citywide
Banks and the Jefferson County Treasurer are granted relief to
pursue their lien remedies through foreclosure.
Pending the sale or refinance, the Debtor will maintain monthly
adequate protection payments to Citywide Banks. In addition, the
Debtor will make monthly payments towards administrative expenses.
The funds for the monthly payments will come from capital
contributions to be made by Mr. Elder. The funds will be deposited
into an account maintained by the Debtor at a federally insured
commercial bank.
The Class 4 Membership Interest Holder shall retain his membership
interests in the Reorganized Debtor. Harry C. Elder holds 100% of
the Membership Interests in the Debtor. During the course of the
Chapter 11 case, Mr. Elder has made capital contributions to cover
administrative expenses and adequate protection payments. The
capital contributions from the commencement of the case through
March 31, 2022 total $4,870. These capital contributions will
continue pending the sale or refinance of the Property.
The Debtor will not be making any payments to the Class 4
Membership Interest Holder until the Property is sold or
refinanced. Mr. Elder as 100% Membership Interest Holder shall
receive any remaining proceeds from the sale or refinance of the
Property after satisfaction of the Allowed Claims and
Administrative Expenses owed by the Debtor.
The Debtor shall have through and including October 31, 2022, to
satisfy its obligations under this Plan from the sale of the
Property or from a refinance of the loan secured by the Property.
Pending the sale or refinance of the Property, the Class 4
Membership Interest Holder shall make monthly capital contributions
in an amount sufficient to meet the monthly obligations to pay
adequate protection payments to the Class 2 Creditor, the agreed
upon monthly payments to Allowed Administrative Expenses as well as
to satisfy any other post petition obligations including fees owed
to the Office of the United States Trustee.
The Debtor projects that the proceeds from the sale or refinance of
the Property will be sufficient to satisfy the obligations under
the Plan. The Debtor anticipates that the Property can be sold for
at least $312,000 (which is a 20% increase from the 2018 appraised
value).
There are no unsecured creditors in the case but there is equity
available to pay claims against the estate under a sale of the
Property. Alternatively, under Chapter 7, the Property would be
foreclosed by the secured creditor leaving no funds available to
pay any other creditors nor any value to the equity interests.
A confirmation hearing has been scheduled for June 7, 2022 at 2:00
p.m. in Courtroom B, U.S. Custom House, 721 - 19th Street, Denver
Colorado 80202-2508.
A full-text copy of the Amended Disclosure Statement dated April
19, 2022, is available at https://bit.ly/3v6Tayt from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Bonnie Bell Bond, Esq.
Law Office of Bonnie Bell Bond, LLC
8400 E. Prentice Avenue, Suite 1040
Greenwood Village, CO 80111
Phone: 303-770-0926
Fax: 303-770-0965
Email: bonnie@bellbondlaw.com
About 27646 T. G.
27646 T. G., LLC filed a petition for Chapter 11 protection (Bankr.
D. Colo. Case No. 21-15421) on Oct. 27, 2021, listing as much as
$500,000 in both assets and liabilities. Judge Joseph G. Rosania
Jr. oversees the case. The Debtor tapped the Law Office of Bonnie
Bell Bond, LLC as legal counsel.
7 DOLLARS: Files Chapter 11 Bankruptcy Protection
-------------------------------------------------
7 Dollars & Up Clothing Inc., doing business as Designer Outlet,
filed for chapter 11 protection in the Southern District of New
York.
According to court filing, 7 Dollars & Up Clothing Inc. estimates
between 1 and 49 unsecured creditors, including 35th Street
Associates, Broadfield International and Internal Revenue Service.
The petition states that funds will be available to unsecured
creditors.
A meeting of creditors under 11 U.S.C. Sec. 341(a) is scheduled on
May 12, 2022 at 2:00 PM at the Office of UST.
About 7 Dollars & Up Clothing
7 Dollars & Up Clothing Inc. is a clothing retailer in New York.
7 Dollars & Up Clothing Inc., d/b/a Designer Outlet, sought Chapter
11 protection (Bankr. S.D.N.Y. Case No. 22-10441) on April 8, 2022.
In the petition filed by Ramin Gidania, as president, 7 Dollars &
Up Clothing estimated assets between $50,000 and $100,000 and
liabilities between $100,000 and $500,000. The case is assigned to
Honorable Judge Lisa G Beckerman. Bruce Weiner, of Rosenberg, Musso
& Weiner, LLP, is the Debtor's counsel.
AE OPCO III: Seeks Approval to Hire Doeren Mayhew as Accountant
---------------------------------------------------------------
AE OPCO III, LLC seeks approval from the U.S. Bankruptcy Court for
the Middle District of Florida to hire Doeren Mayhew, CPAs as its
accountant.
The Debtor requires an accountant to prepare tax returns, audit its
financial statements and provide other accounting services.
The hourly rates charged by the firm for its services are as
follows:
Shareholder $520
Senior Manager $385
Manager $340
Senior Accountant $295
Staff Accountant $250
Doeren Mayhew's standard fee for its services is approximately
$71,500.
As disclosed in court filings, Doeren Mayhew does not represent
interests adverse to the Debtor and its estate in the matter upon
which the firm is to be engaged.
The firm can be reached through:
Lawrence A. Simon, CPA
Doeren Mayhew, CPAs
305 W. Big Beaver Road, Suite 200
Troy, MI 48084
Phone: +1 (888) 870-9873
Email: simon@doeren.com
About AE OPCO III
AE OPCO III, LLC owns and operates an aerospace composite
manufacturing facility. The Clearwater, Fla.-based company
provides
design services, testing, assembling and repairs for commercial and
governmental customers.
AE OPCO III filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-01186) on March 25,
2022, listing as much as $50 million in both assets and
liabilities. Amy Denton Harris serves as Subchapter V trustee.
Judge Catherine Peek McEwen oversees the case.
Alberto F. Gomez, Jr., Esq., at Johnson, Pope, Bokor, Ruppel and
Burns, LLP and Doeren Mayhew, CPAs serve as the Debtor's legal
counsel and accountant, respectively.
AGUILA INC: Creditors' Committee Files Liquidating Plan
-------------------------------------------------------
The Official Committee of Unsecured Creditors of Debtor Aguila Inc.
filed with the U.S. Bankruptcy Court for the Southern District of
New York a Disclosure Statement in connection with the Plan of
Liquidation dated April 18, 2022.
The Debtor is a nonprofit corporation organized under the laws of
New York, with 28 employees as of September 17, 2021. Until
September 30, 2021, the Debtor's headquarters was located at 665
Cauldwell Ave, Bronx, NY 10455, and then moved to The Harlem
Collective, LLA, 1850 Amsterdam Ave, New York, NY 10031.
At its peak, the Debtor operated approximately a dozen homeless
shelters, primarily in the Bronx. At the Petition Date, the Debtor
operated only a single shelter that is anticipated to close by June
30, 2022. As a result of its dramatically pared down operations and
other difficulties, the Debtor initially acknowledged that an
orderly liquidation of its assets was the best course of action.
Subsequently, the Debtor changed direction and announced its
intention to restart the revenue side of its operations,
essentially from the ground up. However, despite the Bankruptcy
Court's admonishment, the Debtor has not demonstrated to the
Committee that there is any significant possibility that it will
ever be awarded the required critical mass of new contracts
necessary to support confirmation of a plan of reorganization and
the Debtor's administrative overhead.
The Committee believes that the Debtor's proposed reorganization is
illusory and not in the best interest of creditors. The Committee
has expressed its concerns to the Debtor but has been unsuccessful
in negotiating a consensual resolution of this bankruptcy case.
Accordingly, the Committee is pursuing confirmation of its Plan to
liquidate the Debtor's assets.
The Plan provides a means by which the remaining portion of the
Debtor's Accounts Receivable and other assets will be liquidated.
The Plan further provides that the proceeds of such liquidation,
together with the Debtor's Cash, will be distributed under Chapter
11 of the Bankruptcy Code, and sets forth the treatment of all
Claims against the Debtor.
The Plan provides for payments on Allowed Claims in accordance with
the priorities for claims as set forth under the Bankruptcy Code.
The Plan will primarily be funded with the Debtor's Cash and
collection of the Accounts Receivable. The Plan may also be funded
with Litigation Proceeds, if any, and the net proceeds from the
liquidation of any other assets of the Debtor.
Class 1 consists of the Claims filed by Ford Motor Credit Company
LLC and Americredit Financial Services, Inc. d/b/a GM Financial.
Holders of Claims Class 1 that are Allowed as defined in the Plan
shall, at the discretion of the Plan Administrator, (i) receive
payment in full (or such lesser amount agreed to by the Holder of
the Class 1 Claim) or (ii) receive the return of the collateral
securing such Claims. Class 1 is Unimpaired under the Plan.
Class 2 consists of General Unsecured Claims. Holders of Claims
Class 2 that are Allowed as defined in the Plan will receive, in
full and final satisfaction, compromise, settlement and release of
the Allowed General Unsecured Claims, a Pro Rata Distribution from
Available Cash remaining after payment of Allowed Administrative
Claims, Allowed Secured Claims, Allowed Priority Tax Claims, U.S.
Trustee Fees, and Allowed Other Priority Claims in one or more
Distributions as determined by the Plan Administrator on a date(s)
to be determined by the Plan Administrator. Class 2 is impaired
under the Plan insofar as Holders of Allowed General Unsecured
Claims are not anticipated to be paid in full. The allowed
unsecured claims total $11,937,264.84.
The Plan shall be funded with: (a) the Debtor's Cash on hand at the
Effective Date; (b) the Accounts Receivable Proceeds, (c) the
Litigation Proceeds; and (d) the proceeds of amounts realized from
the liquidation and/or turnover of any other assets of the Debtor.
All Distributions shall be made by the Plan Administrator.
A full-text copy of the Disclosure Statement dated April 18, 2022,
is available at https://bit.ly/3vFM6I5 from PacerMonitor.com at no
charge.
Counsel to the Official Committee of Unsecured Creditors:
Thomas Slome, Esq.
Amanda Tersigni, Esq.
Cullen and Dykman, LLP
100 Quentin Roosevelt Boulevard
Garden City, NY 11530
Tel: (516) 357-3700
Email: tslome@cullenllp.com
atersigni@cullenllp.com
Michelle McMahon, Esq.
44 Wall Street
New York, New York 10005
(212) 510-2296
Email: mmcmahon@cullenllp.com
About Aguila Inc.
Aguila Inc., a nonprofit homeless services organization in New
York, filed a petition for Chapter 11 protection (Bankr. S.D.N.Y.
Case No. 21- 11776) on Oct. 15, 2021, listing as much as $10
million in both assets and liabilities. Judge Martin Glenn
oversees the case.
The Debtor tapped Robert Leslie Rattet, Esq., at Davidoff Hutcher &
Citron, LLP as legal counsel.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors in the Debtor's Chapter 11 case on Dec. 14,
2021. The committee is represented by Cullen and Dykman, LLP.
ALARMAS COMPUTARIZADAS: Reaches BPPR Stipulation; Amends Plan
-------------------------------------------------------------
Alarmas Computarizadas, Inc., submitted a Second Amended Plan of
Reorganization for Small Business under Subchapter V dated April
18, 2022.
The Plan is being amended to modify the amount of the monthly
mortgage payment and to provide for the retention of the secured
creditors liens. As per the stipulation entered between debtor and
BPPR the monthly mortgage payment will be increased to fund an
escrow account that will be used to cover hazard/flood insurance
and property taxes.
Class 1 consists of Banco Popular de Puerto Rico (BPPR) allowed
secured claim totaling $132,194.27. Banco Popular's secured claim
will receive direct payments from Debtor. Monthly payments of
$1,654.65 at an amortization of 7 years and an interest rate of 5%
for a period of 83 months and a final balloon payment for the
remaining balance ($48,184.55) at month 84. The monthly payment
includes $252.54 to fund an escrow account that will be used to
cover flood/hazard Insurance and property taxes. This Class has
100% estimated recovery.
Class 2 consists of the Internal Revenue Services and CRIM secured
claims totaling $7,133.20. Internal Revenue Services' claim will be
paid in full in 60 equal monthly installments of $89.81 including
an interest rate of 3%. CRIM's secured claim will be paid in full
in 60 equal monthly installments of $38.36 including an interest
rate of 3%. This Class is unimpaired.
Class 3 consists of all non-priority unsecured claim allowed under
502 of the Code totaling $25,943.99. Allowed unsecured creditors
will receive a dividend of 100%. Debtor will make 60 equal monthly
installments of $465.50 including a 3% interest rate. This Class is
unimpaired.
Secured creditors shall retain their liens to the extent of the
allowed amount of their claims.
The Debtor has implemented measures to streamline its business
operation and improve its marketing strategies. Debtor will use
existing assets and the income generated from the operation of its
business to fund the plan.
A full-text copy of the Second Amended Plan of Reorganization dated
April 18, 2022, is available at https://bit.ly/3KbKtaD from
PacerMonitor.com at no charge.
Debtor's Counsel:
Roberto L. Mateo, Esq.
P.O. Box 336877
Ponce, PR 00733
Telephone: (787) 840-1212
Email: mateolaw@msn.com
About Alarmas Computarizadas
Alarmas Computarizadas, Inc., sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D.P.R. Case No. 21-02431) on Aug.
16, 2021, listing as much as $500,000 in both assets and
liabilities. Julio A. Rosa Figueroa, president, signed the
petition. Roberto L. Mateo, Esq., serves as the Debtor's legal
counsel.
ALIERA COMPANIES: Creditors' Committee Members Disclose Claims
--------------------------------------------------------------
In the Chapter 11 cases of The Aliera Companies Inc., et al., the
law firm of Stevens & Lee, P.C., Sirianni Youtz Spoonemore
Hamburger PLLC and Mehri & Skalet, PLLC submitted a verified
statement under Rule 2019 of the Federal Rules of Bankruptcy
Procedure, to disclose that it is representing the following
creditors:
(a) Neil F. Luria, as the trustee of the liquidating trust
arising under the Sharity Ministries, Inc., Trust
Agreement;
(b) the following creditors, who commenced the involuntary case
against The Aliera Companies Inc.
(i) Austin Willard,
(ii) Hanna Albina and Austin Willard, as representatives
of a certified class comprising all persons who,
while a Kentucky resident, purchased or were covered
by a plan from The Aliera Companies Inc. and Sharity
Ministries, Inc., which purported to be a "health
care sharing ministry,"
(iii) Gerald Jackson and Roslyn Jackson,
(iv) Dean Mellom, and
(v) Gerald Jackson, Roslyn Jackson, and Dean Mellom, as
representatives of a certified class comprising all
Washington residents who acquired plans from or
through The Aliera Companies Inc., Aliera Healthcare,
Inc., and Sharity Ministries, Inc. or any of those
Entities' subsidiaries that purported to be "health
care sharing ministry" plans at any time from June
27, 2018 to July 8, 2021; and
(c) the following creditors, who did not join the Petitioning
Creditors in commencing the involuntary case against
Aliera:
(i) Jon Perrin and Julie Perrin, as both individuals and
representatives of a certified class comprising all
Washington residents who acquired plans from or
through The Aliera Companies Inc., Aliera Healthcare,
Inc., and Sharity Ministries,
(ii) Hanna Albina, as an individual,
(iii) Corlyn Duncan and Bruce Duncan, as individuals and
representatives of a proposed class,
(iv) George T Kelly, III and Thomas Boogher, as both
individuals and representatives of a proposed class,
and
(v) Rebecca Smith, Ellen Larson, Justine Lund, Jaime
Beard, and Jared Beard, as both individuals and
representatives of a proposed class.
The following law firms also represent the Clients:
(a) Sirianni Youtz Spoonmore Hamburger PLLC and
(b) Mehri & Skalet, PLLC
Counsel represents each of the Clients, rather than the Clients as
a group; however, the Clients are, and compose a group of,
creditors that are:
(a) acting in concert to advance their common interests in
these cases under Chapter 11 of the Bankruptcy Code and
(b) not affiliates or insiders of each other.
The Petitioning Creditors and the Non-Petitioning Creditors formed
a group to pursue their claims against Aliera.
Each of the Non-Petitioning Creditors declined or was not eligible
to be a petitioning creditor in the involuntary case against
Aliera; therefore, the Petitioning Creditors commenced the case
without the Non-Petitioning Creditors.
The Liquidating Trustee joined the Petitioning Creditors' group
later; however, the Liquidating Trustee never joined in the
petition that the Petitioning Creditors filed under Chapter 11 of
the Bankruptcy Code to commence the involuntary case against
Aliera.
The Clients' group has informally agreed to act for
(a) the beneficiaries of the trust arising under
(i) the Combined Disclosure Statement and Chapter 11 Plan
of Liquidation of Sharity Ministries, Inc. and
(ii) Sharity Ministries, Inc., Liquidating Trust Agreement
And
(b) Sharity Ministries, Inc.'s current and former members.
Hanna Albina
* Debtors Liable on the Claim: The Aliera Companies, Inc.
* Claim's Nature: Judgment
Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Share of $4,679,868.46, plus additional amounts,
including post- judgment interest
Hanna Albina
* Debtors Liable on the Claim: Advevo LLC
Ensurian Agency LLC
Tactic Edge Solutions LLC
USA Benefits & Administrators LLC
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Austin Willard
* Debtors Liable on the Claim: The Aliera Companies, Inc.
* Claim's Nature: Judgment
Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: $16,255.54, plus additional amounts, including
post- judgment interest
Austin Willard
* Debtors Liable on the Claim: Advevo LLC
Ensurian Agency LLC
Tactic Edge Solutions LLC
USA Benefits & Administrators LLC
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Hanna Albina and
Austin Willard
* Debtors Liable on the Claim: The Aliera Companies, Inc.
* Claim's Nature: Judgement
Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: $4,679,868.46, plus additional amounts,
including post-judgment interest
Hanna Albina and
Austin Willard
* Debtors Liable on the Claim: Advevo LLC
Ensurian Agency LLC
Tactic Edge Solutions LLC
USA Benefits & Administrators LLC
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Roslyn and Gerald Jackson
* Debtors Liable on the Claim: The Aliera Companies, Inc.
* Claim's Nature: Judgement
Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: $12,582.00, plus additional amounts, including
post-judgment interest
Roslyn and Gerald Jackson
* Debtors Liable on the Claim: Advevo LLC
Ensurian Agency LLC
Tactic Edge Solutions LLC
USA Benefits & Administrators LLC
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Jon and Julie Perrin
* Debtors Liable on the Claim: The Aliera Companies, Inc.
* Claim's Nature: Judgement
Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: $7,607.92, plus additional amounts, including
post-judgment interest
Jon and Julie Perrin
* Debtors Liable on the Claim: Advevo LLC
Ensurian Agency LLC
Tactic Edge Solutions LLC
USA Benefits & Administrators LLC
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Dean Mellom
* Debtors Liable on the Claim: The Aliera Companies, Inc.
* Claim's Nature: Judgement
Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: $3,692.00, plus additional amounts, including
post-judgment interest
Dean Mellom
* Debtors Liable on the Claim: Advevo LLC
Ensurian Agency LLC
Tactic Edge Solutions LLC
USA Benefits & Administrators LLC
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Roslyn and Gerald Jackson
Jon and Julie Perrin, and
Dean Mellom
* Debtors Liable on the Claim: The Aliera Companies, Inc.
* Claim's Nature: Judgement
Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: $21,352,827.08, plus additional amounts,
including post-judgment interest
Roslyn and Gerald Jackson
Jon and Julie Perrin, and
Dean Mellom
* Debtors Liable on the Claim: Advevo LLC
Ensurian Agency LLC
Tactic Edge Solutions LLC
USA Benefits & Administrators LLC
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Corlyn and Bruce Duncan
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Corlyn and Bruce Duncan
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
George T Kelly, III
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Thomas Boogher
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Rebecca Smith
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Ellen Larson
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Member of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Justine Lund
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Members of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Jaime and Jared Beard
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Members of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Rebecca Smith
Ellen Larson
Justine Lund
Jaime Beard
Jared Beard
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Members of Sharity Ministries, Inc.
* Claim's Amount: Unliquidated
Liquidating Trustee
* Debtors Liable on the Claim: All Five
* Claim's Nature: Contract
Tort
Statute
Voidable Transactions
* Claim's Amount: Unliquidated
Estimate of $600,347,381.00, plus attorney's
fees and costs
None of the Clients has any known "disclosable economic interest"
other than as disclosed in the preceding paragraphs.
Other than as disclosed herein, S&L, to the best of its knowledge
and information,
(a) does not currently represent or claim to represent any
other entity in any of the Debtors' cases under the
Bankruptcy Code and
(b) does not hold any claim against or interest in any of the
Debtors or any of their estates.
Counsel also represents the Clients in another bankruptcy case in
this Court, In re Sharity Ministries, Inc., Case No. 21-11001
(JTD), and represents the Liquidating Trustee in any other
proceeding to which he is a party or in which he has intervened to
protect the property that he holds in trust.
And Co-Counsel represents other entities, including the Clients
other than the Liquidating Trustee, in actions and other
proceedings against one or more of the Debtors. That is, Co-Counsel
represents Gerald Jackson, Roslyn Jackson, Dean Mellom, Jon Perrin,
Julie Perrin, Corlyn Duncan, Bruce Duncan, George T Kelly, III,
Thomas Boogher, Rebecca Smith, Ellen Larson, Justine Lund, Jaime
Beard, Jared Beard, Hanna Albina, and Austin Willard, in both their
individual capacities and their capacities as class representatives
in the following civil actions:
(a) Jackson v. The Aliera Companies, Inc., Civil Action No.
2:19-cv-01281- BJR (W.D. Wash.);
(b) Duncan v. The Aliera Companies, Inc., Civil Action No.
2:20-cv-00867- TLN-KJN (E.D. Cal.);
(c) Kelly v. The Aliera Companies, Inc., Civil Action No.
3:20-cv-05038- MDH (W.D. Mo.);
(d) Smith v. The Aliera Companies, Inc., Civil Action No.
1:20-cv-02130-RBJ (D. Colo); and
(e) Albina v. The Aliera Companies, Inc., Civil Action No.
5:20-cv-00496- JMH (C.D. Ky.).
Counsel has omitted the Clients' addresses from this statement;
however, Counsel will make the Clients’ addresses available to
(a) the Court,
(b) the United States Trustee, and
(c) any party in interest who makes a reasonable request for
the addresses.
Counsel and the Clients reserve their rights to amend, supplement,
or otherwise modify this statement, and they are providing this
statement without forfeiture of, waiver of, or other prejudice to
Counsel's and the Clients' rights to file any other papers,
including the following, in one or more of these cases:
(a) proofs of claim,
(b) motions, applications, and other requests for relief,
including requests for the allowance and/or payment of an
administrative expense,
(c) pleadings, including
(i) complaints commencing adversary proceeding and
(ii) answers and other responsive pleadings,
(d) notices,
(e) statements, including verified statements under FED. R.
BANKR. P. 2019 amending, supplementing, or otherwise
modifying this statement, and
(f) instruments, and
(g) papers and documents of any other kind whatsoever.
Counsel to the Liquidating Trustee, the Petitioning Creditors, and
the Non-Petitioning Creditors can be reached at:
Joseph H. Huston, Jr., Esq.
David W. Giattino, Esq.
STEVENS & LEE, P.C.
919 North Market Street, Suite 1300
Wilmington, DE 19801
Tel: (302) 425-3310 | (302) 425-2608
Fax: (610) 371-7972 | (610) 371-7988
E-mail: joseph.huston@stevenslee.com
david.giattino@stevenslee.com
Eleanor Hamburger, Esq.
SIRIANNI YOUTZ SPOONEMORE HAMBURGER PLLC
3101 Western Avenue, Suite 350
Seattle, WA 98121
Tel: (206) 223-0303
Fax: (206) 223-0246
E-mail: ele@sylaw.com
- and -
Cyrus Mehri, Esq.
MEHRI & SKALET, PLLC
2000 K Street NW, Suite 325
Washington, D.C. 20006
Tel: (202) 822-5100
Fax: (202) 822-4997
E-mail: CMehri@findjustice.com
A copy of the Rule 2019 filing is available at
https://bit.ly/3OzWwBK at no extra charge.
About Aliera Companies
The Aliera Companies Inc. is focused on providing a full spectrum
of revolutionary options and services to a multitude of industries
that fit every need and budget. The company provides services to
support its subsidiaries which focus on the unique aspects of the
health care industry.
Plaintiffs in a case -- docketed as Hanna Albina and Austin
Willard, individually and on behalf of others similarly situated,
Plaintiffs, v. The Aliera Companies, Inc., Trinity Healthshare,
Inc. and Oneshare Health, LLC Unity Healthshare, LLC, Case No.
20-CV-00496, (E.D. Ky., Dec. 11, 2020) -- filed an involuntary
petition under Chapter 11 of the Bankruptcy Code against Aliera
(Bankr. D. Del. Case No. 21-11548) on Dec. 5, 2021.
Joseph H. Huston, Jr., Esq., of Stevens & Lee, P.C., is the
petitioners and plaintiffs' counsel.
On Dec. 21, 2021, Aliera filed a voluntary Chapter 11 petition
(Bankr. N.D. Ga. Case No. 21-59493), disclosing assets of $1
million to $10 million and liabilities of $500 million to $1
billion. Advevo LLC and three other Aliera affiliates -- Ensurian
Agency LLC, Tactic Edge Solutions LLC and USA Benefits &
Administrators LLC -- also filed voluntary Chapter 11 petitions on
Dec. 21, 2021.
On Jan. 25, 2022, the petitioning creditors obtained an order
granting their motion to transfer the voluntary Chapter 11 cases to
the Delaware Bankruptcy Court, which has been overseeing the
liquidation of Aliera's affiliated corporation, Trinity
Healthshare, Inc., now known as Sharity Ministries, Inc.
On Feb. 16, 2022, Judge John T. Dorsey of the Delaware Bankruptcy
Court ordered the consolidation of Aliera's voluntary Chapter 11
proceeding with the involuntary case filed by the petitioning
creditors (with Case No. 21-11548 being the surviving case number)
and terminated the company's voluntary proceeding.
Meanwhile, Judge Dorsey ordered the joint administration of the
involuntary proceeding and the four other voluntary cases filed by
the Aliera affiliates, with Case No. 21-11548 as the lead
bankruptcy case.
J. Robert Williamson, Esq., at Scroggins & Williamson, P.C., and
Monzack Mersky and Browder, PA serve as the Debtors' bankruptcy
counsels. Epiq Corporate Restructuring, LLC is the claims and
noticing agent and administrative advisor.
AMERICAN AXLE: Egan-Jones Retains 'B-' Senior Unsecured Ratings
---------------------------------------------------------------
Egan-Jones Ratings Company, on March 28, 2022, maintained its 'B-'
foreign currency and local currency senior unsecured ratings on
debt issued by American Axle & Manufacturing Holdings, Inc. EJR
also maintained its 'B' rating on commercial paper issued by the
Company.
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings, Inc. operates as an automotive supplier of driveline and
drivetrain systems and related components for light trucks, SUVs,
passenger cars, crossover, and commercial vehicles.
ANTICANCER INC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Anticancer, Inc.
7917 Ostrow Street
San Diego, CA 92111
Business Description: Anticancer provides scientific research and
development services.
Chapter 11 Petition Date: April 21, 2022
Court: United States Bankruptcy Court
Southern District of California
Case No.: 22-01058
Debtor's Counsel: Kit J. Gardner, Esq.
LAW OFFICES OF KIT J. GARDNER
501 W. Broadway, Suite 800
San Diego, CA 92101
Tel: (619) 972-8761
E-mail: kgardner@gardnerlegal.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Robert M. Hoffman as president.
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/MVDI2BI/Anticancer_Inc__casbke-22-01058__0001.0.pdf?mcid=tGE4TAMA
ART VAN: Founder's Family Gets More Time to Respond to Fraud Suit
-----------------------------------------------------------------
Candice Williams of The Detroit News reports that the family of Art
Van Furniture's founder has been given more time to respond a
federal lawsuit that alleges members doomed the Warren-based
business due to transactions they allegedly made during the
company's sale to a private equity firm in 2017.
The deadline for the heirs of the late Art Van Elslander to respond
is June 10, 2022.
A document filed Thursday in U.S. Bankruptcy Court for the District
of Delaware says the family members acknowledged that the complaint
was properly served to them but they may seek the dismissal of a
trust established by Van Elslander, who died in 2018, and his
estate "on grounds that such entities do not exist and therefore
cannot properly be named as defendants and/or served with
process."
Attorneys for the Van Elslanders were not immediately available for
comment.
The lawsuit, filed last March 2022 by Alfred Giuliano, the Chapter
7 bankruptcy trustee of Art Van Furniture LLC, alleges that the Van
Elslanders harmed the Warren-based business by making more than
$105 million in "fraudulent transfers" through real estate deals
during Art Van's sale to a private equity firm for $620 million in
2017. The company would later file for bankruptcy and shutter its
doors in 2020.
Giuliano is seeking to recover more than $105 million from the
family — including Art Van Elslander's estate.
The Van Elslander family has denied any wrongdoing, saying that
when it sold Art Van in 2017, the company was debt-free. They
called the lawsuit an unfair attempt to solve problems the buyer
caused.
"Make no mistake, the bankruptcy proceedings may be labeled 'Art
Van,' but this is about the consequences of business decisions made
by the company that purchased our family business in 2017," the Van
Elslander family wrote in a statement last month.
Boston-based Thomas H. Lee Partners, which bought Art Van
Furniture, is not a party in the lawsuit.
About Art Van Furniture
Art Van is a brick-and-mortar furniture and mattress retailer
headquartered in Warren, Michigan. The Company operates 169
locations, including 92 furniture and mattress showrooms and 77
freestanding mattress and specialty locations. The Company does
business under brand names, including Art Van Furniture, Pure
Sleep, Scott Shuptrine Interiors, Levin Furniture, Levin Mattress,
and Wolf Furniture.
The Company was founded in 1959 and was owned by its founder, Art
Van Elslander, until it was sold to funds affiliated with Thomas H.
Lee Partners, L.P. in March 2017. As part of this transaction, THL
acquired the operating assets of the Company and certain real
estate investment trusts, who closed the transaction alongside THL,
acquired the owned real estate portfolio of the Company, and
entered into long-term leases with Art Van. The proceeds from the
sale-leaseback transaction were used to fund the purchase price
paid to the selling shareholders.
Art Van Furniture, LLC, and 12 affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 20-10553) on March 8,
2020.
Art Van was estimated to have $100 million to $500 million in
assets and liabilities as of the bankruptcy filing.
The Hon. Laurie Selber Silverstein is the case judge.
The Debtors tapped Benesch, Friedlander, Coplan & Aronoff LLP as
counsel. Kurtzman Carson Consultants LLC is the claims agent.
ARTESIAN FUTURE: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Artesian Future Technology, LLC
d/b/a Artesian Builds
d/b/a Artesian, LLC
d/b/a BLDYR, Inc.
d/b/a Artesian
399 Grand Avenue
Oakland, CA 94610
Business Description: The Debtor manufactures computer and
peripheral equipment.
Chapter 11 Petition Date: April 22, 2022
Court: United States Bankruptcy Court
Northern District of California
Case No.: 22-40396
Judge: Hon. Charles Novack
Debtor's Counsel: Michael W. Malter, Esq.
Robert G. Harris, Esq.
Julie H. Rome-Banks, Esq.
BINDER & MALTER, LLP
2775 Park Avenue
Santa Clara, CA 95050
Tel: (408) 295-1700
Fax: (408) 295-1531
Email: Michael@bindermalter.com
rob@bindermalter.com
julie@bindermalter.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Noah Katz as CEO.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/KAWOAMQ/Artesian_Future_Technology_LL__canbke-22-40396__0001.1.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/KF4B4RY/Artesian_Future_Technology_LL__canbke-22-40396__0001.0.pdf?mcid=tGE4TAMA
BAUSCH + LOMB: Moody's Gives Ba2 Rating on New Senior Secured Debt
------------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating (LGD1) to the new
senior secured credit facilities of Bausch + Lomb Corporation
("Bausch + Lomb"), a subsidiary of Bausch Health Companies Inc.
("Bausch Health"). There are no changes to Bausch Health's existing
ratings including the B2 Corporate Family Rating, the B2-PD
Probability of Default rating, the Ba2 and Ba3 ratings on certain
senior secured credit facilities and secured notes, the B3 senior
unsecured rating and the SGL-1 Speculative Grade Liquidity Rating.
The outlook on Bausch Health remains unchanged at negative, while
the outlook on Bausch + Lomb is positive.
The Bausch + Lomb senior secured term loan, together with proceeds
from an anticipated initial public offering of Bausch + Lomb
shares, are intended to reduce debt at Bausch Health. These
transactions relate to the planned separation of Bausch + Lomb from
Bausch Health.
Assignments:
Issuer: Bausch + Lomb Corporation
Senior Secured Tem Loan, Assigned Ba2 (LGD1)
Senior Secured Revolving Bank Credit, Assigned Ba2 (LGD1)
Outlook actions:
Issuer: Bausch + Lomb Corporation
Outlook, Assigned Positive
RATINGS RATIONALE
The Ba2 rating on Bausch + Lomb's secured credit facilities
considers the company's strong presence in the global eyecare
market, its solid growth prospects, and its modest financial
leverage on a stand-alone basis. However, the rating also reflects
the ownership (and majority ownership after the anticipated IPO) by
Bausch Health Companies Inc., which has a B2 Corporate Family
Rating. Despite not being a guarantor of Bausch Health's debt
obligations, Bausch + Lomb's financial flexibility is constrained
until a full separation occurs. This is because its operations and
financial policies are controlled by the parent company, which
faces material credit risks related to high financial leverage and
an unresolved patent challenge on Xifaxan.
The Ba2 senior secured rating considers that recovery prospects on
the Bausch + Lomb secured credit agreement are stronger than those
of other obligations of Bausch Health based on strong asset
coverage of debt.
Bausch Health's B2 Corporate Family Rating reflects its high
financial leverage with gross debt/EBITDA of over 7x as of December
31, 2021 using Moody's calculations. The credit profile is also
constrained by the pending spinoff of Bausch + Lomb. This
transaction will increase business risks of the remaining company,
known as Bausch Health, due to reduced scale and diversity and high
leverage initially, with targeted net debt/EBITDA of 6.5x to 6.7x
and faces execution risks in attaining this target. The company
also faces various outstanding legal investigations and an
unresolved patent challenge on Xifaxan -- its largest product.
These risks are tempered by good progress in an ongoing turnaround
prior to the coronavirus pandemic, and a consistent focus on
deleveraging, which Moody's expects will continue after the
spinoff. The credit profile is supported by good free cash flow,
owing to high margins, modest capital expenditures and an efficient
tax structure. Moody's will continue to gauge the impact on the
credit profile as more details around the various Bausch + Lomb
spinoff transactions are finalized, and based on the latest
operating performance, risk factors and financial policies.
ESG considerations are material to Bausch Health's credit profile.
Bausch Health's key social risks include a variety of unresolved
legal issues, notwithstanding significant progress to date at
resolving such matters. Other social risks include exposure to
regulatory and legislative efforts aimed at reducing drug pricing.
However, Bausch Health's product and geographic diversification
help mitigate some of that exposure, as well as business lines
outside of branded pharmaceuticals. Among governance
considerations, management has had a consistent debt reduction
strategy, which Moody's envisions continuing following the eyecare
spinoff. In addition, the company has built a steady track record
of generating positive organic growth in recent years.
The outlook for Bausch + Lomb Corporation is positive, based on the
pending separation from Bausch Health which, if successfully
executed, will improve its credit profile.
The outlook for Bausch Health is negative, reflecting execution
risks associated with upcoming transactions related to the Bausch +
Lomb spinoff and the negative credit impact on the remaining Bausch
Health business.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade of Bausch + Lomb's ratings
include solid operating performance and executing the separation
from Bausch Health. Factors that could lead to a downgrade of
Bausch + Lomb's ratings include failure to effect the spin-off
combined with a degradation in Bausch Health's credit quality.
Factors that could lead to an upgrade of Bausch Health's ratings
include consistent earnings growth, successful pipeline execution
of new rifaximin formulations, and significant resolution of
outstanding legal matters including the Xifaxan patent challenge.
On a total company basis, gross debt/EBITDA sustained below 6.0x
could support an upgrade. After the pending Bausch + Lomb spinoff,
gross debt/EBITDA sustained below 4.0 times could support an
upgrade. Factors that could lead to a downgrade of Bausch Health's
ratings include operating setbacks, large litigation-related cash
outflows, or an adverse outcome in the unresolved Xifaxan patent
challenge. Quantitatively, on a total company basis, gross
debt/EBITDA sustained above 7.0x could lead to a downgrade. After
the pending Bausch + Lomb spinoff, gross debt/EBITDA sustained
above 5.5 times could lead to a downgrade.
Bausch + Lomb Corporation, a subsidiary of Bausch Health Companies
Inc., is a global eyecare company with 2021 revenues of
approximately $3.8 billion. Bausch Health Companies Inc. is a
global company that develops, manufactures and markets a range of
pharmaceutical, medical device and over-the-counter products. These
are primarily in the therapeutic areas of eye health,
gastroenterology and dermatology. Revenues in 2021 totaled
approximately $8.4 billion including Bausch + Lomb.
The principal methodology used in these ratings was Pharmaceuticals
published in November 2021.
BRINK'S CO: Egan-Jones Retains B+ Sr. Unsecured Debt Ratings
------------------------------------------------------------
Egan-Jones Ratings Company, on March 29, 2022, maintained its 'B+'
foreign currency and local currency senior unsecured ratings on
debt issued by Brink's Company.
Headquartered in Richmond, Virginia, Brink's Company provides
security services globally.
BSPV-PLANO: Wins Cash Collateral Access Thru Aug 26
---------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of Texas,
Sherman Division, authorized BSPV-Plano, LLC to use cash collateral
on a final basis in accordance with the budget.
The Debtor is authorized to use, as cash collateral, Project
Revenues, the remaining funds in the Project Fund, $1,034,000 of
the funds in the O&M Fund, and other cash received by the Debtor in
the ordinary course of operations of its business, including all
amounts currently held in the Debtor's operating account, until the
earlier of (i) the Debtor's ability to use cash collateral
terminates as the result of the occurrence of a Termination Event
or (ii) August 26, 2022.
Huntington National Bank, in its capacity as trustee for certain
pre-petition bonds and as secured lender to the Debtor, will not be
obligated to provide any Trustee-Held Funds other than the funds in
the Project Fund and $1,034,000 from the O&M Fund.
The Debtor is obligated to the Bond Trustee on account of the Bonds
authorized and issued by the New Hope Cultural Education Facility
Finance Corporation for the benefit of the Debtor in the aggregate
principal amount of $66,795,000.
The Bond Trustee has a security interest, lien and mortgage on
substantially all of the Debtor's assets.
The funds held in the Debt Service Reserve Funds and the O&M Fund
are held in trust for the Bondholders. The Bond Trustee agrees the
funds in the Project Fund and $1,034,000 in the O&M Fund are
available to the Debtor to finish construction of the Independent
Senior Luxury Apartment Community and for other purposes as set
forth in the Final Order.
As additional adequate protection to the Bond Trustee for the use
of the cash collateral, the Bond Trustee is granted a valid,
perfected, and enforceable replacement lien and security interest
in (i) all assets of the Debtor and (ii) all other assets of the
Debtor of any kind or nature whatsoever within the meaning of
Section 541 of the Bankruptcy Code.
The Replacement Lien will be subject and subordinate to only valid
and perfected liens existing on the Petition Date that are senior
to Liens of the Bond Trustee.
As additional adequate protection for any Diminution, the Bond
Trustee will have a superpriority administrative expense claim
pursuant to Section 507(b) of the Bankruptcy Code with recourse to
and payable from any and all assets of the Debtor's estate.
The Debtor asserted at the Initial Hearing that the value of the
Community in its current state is not less than $80,000,000. The
Bond Trustee has indicated that following its review after the
Initial Hearing, it believes the value of the Community in its
current state is not less than $74,000,000. As such, the Court
finds the value of the Bond Trustee's collateral securing the Bond
Claim is greater than the amount of the Bond Claim, and that the
Bond Trustee is over-secured and protected by an equity cushion.
As further adequate protection for the use of cash collateral, the
Debtor and the Debtor's equity holders have agreed to provide
funding pursuant to a debtor-in-possession loan approved by the
Court in the amount of $1,000,000 and an equity contribution in an
amount not less than $1,200,000. The proceeds of the DIP Loan and
the Equity Contribution are to be used at the times, in the
amounts, and for the uses set forth in the Cash Collateral Budget.
A copy of the order and the Debtor's 26-week budget for the period
from March 4 to August 26, 2022 is available at
https://bit.ly/3MnYF1t from PacerMonitor.com.
The Debtor projects $256,000 in total receipts and $522,000 in
total operating disbursements for the period.
About BSPV-Plano, LLC
BSPV-Plano, LLC is developing a 31.5-acre, "55+" Independent Senior
Luxury Apartment Community with 318 units of apartment inventory,
that is known and branded as "The Bridgemoor at Plano," and located
at 1109 Park Vista Road in Plano, Texas.
BSPV-Plano, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Tex. Case No. 22-40276) on March 1,
2022. In the petition signed by Richard Shaw, manager, the Debtor
disclosed up to $100 million in both assets and liabilities.
Judge Brenda T. Rhoades oversees the case.
Thomas D. Berghman, Esq., at Munsch Hardt Kopf and Harr, PC, is the
Debtor's counsel.
BUCKHARDT TECHNOLOGIES: Wins Cash Collateral Access Thru May 6
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized Buckardt Technologies, Inc., dba
Konsultek, to use cash collateral on an interim basis in accordance
with the budget through May 6, 2022.
Prior to the Petition Date, the Debtor borrowed from BMO Harris
Bank. As of the Petition Date, the Debtor owed the Secured Lender
$381,719, including principal and interest.
The other potential lien holders are Funding Circle, Small Business
Administration, Internal Revenue Service, and Ingram Micro, Inc.
In return for the Debtor's continued interim use of cash
collateral, and for any diminution in value of the Prepetition
Secured Lender's interest in the cash collateral from and after the
Petition date, the Prepetition Secured Lender will receive an
administrative expense claim.
In further return for the Debtor's continued interim use of cash
collateral, the Prepetition Secured Lender is granted a replacement
lien in substantially all of the Debtor's assets.
The Prepetition Secured Lender and all other subordinate lien
holders are granted replacement liens, attaching to the Collateral,
but only to the extent of their prepetition liens and only to the
extent of priority that existed on the date of filing.
The liens granted will be valid, perfected, and enforceable without
any further action by the Debtor and/or the Prepetition Secured
Lender and need not be separately documented.
The further hearing on the matter is scheduled for May 5 at 11
a.m.
A copy of the order is available at https://bit.ly/3xN7e1P from
PacerMonitor.com.
About Buckardt Technologies, Inc.
Buckardt Technologies, Inc. is an information and security
technology consulting firm. Buckardt sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Cal. Case No.
22-04420) on April 18, 2022. In the petition signed by Judith A.
Buckardt, president, the Debtor disclosed up to $50,000 in assets
and up to $10 million in liabilities.
Judge Lashonda A. Hunt oversees the case.
Richard G. Larsen, Esq., at SpringerLarsenGreene, LLC is the
Debtor's counsel.
BUSY BEES: Case Summary & Seven Unsecured Creditors
---------------------------------------------------
Debtor: Busy Bees Smocks!, LLC
d/b/a Busy Bees Smocks
12152 Cougar Drive
Brookwood, AL 35444
Business Description: Busy Bees operates an online children's
clothing store.
Chapter 11 Petition Date: April 22, 2022
Court: United States Bankruptcy Court
Northern District of Alabama
Case No.: 22-00938
Judge: Hon. D. Sims Crawford
Debtor's Counsel: Steven D. Altmann, Esq.
ALTMANN LAW FIRM, LLC
NOMBERG LAW FIRM
3940 Montclair Rd, Ste 401
Birmingham, AL 35213
Tel: (205) 930-6900
Fax: (205) 855-4262
Email: steve@nomberglaw.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Courtney Burrage as managing member.
A copy of the Debtor's list of seven unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/4FF5GAY/Busy_Bees_Smocks_LLC__alnbke-22-00938__0002.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/7ZQKAJQ/Busy_Bees_Smocks_LLC__alnbke-22-00938__0001.0.pdf?mcid=tGE4TAMA
BW HOLDING: Moody's Affirms 'B3' CFR & Alters Outlook to Negative
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Moody's Investors Service affirmed the B3 Corporate Family Rating
and B3-PD Probability of Default Rating of BW Holding, Inc.
("Brook+Whittle"). Moody's also affirmed the B2 rating of the first
lien senior secured credit facilities, including the revolver, the
first lien term loan and the delayed draw term loan, at
Brook+Whittle. At the same time, Moody's revised the rating outlook
to negative from stable.
The incremental first lien term loan, together with a delayed draw
first lien term loan, delayed draw second lien term loan (unrated)
and incremental second lien term loan (unrated), will be used to
acquire the custom labels division of Cenveo Worldwide Limited and
pay related fees and expenses.
Genstar Capital, the private-equity sponsor that controls
Brook+Whittle, will also invest in this transaction in the form of
cash and preferred equity, together with a minority investment by
management, which finances about 35% of the acquisition funding.
"The negative outlook considers Brook+Whittle's aggressive
financial policy to take on a largely debt-financed acquisition
with a significant size within a few months after being acquired by
a private equity sponsor, its limited free cash flow (FCF)
generation we expect for the next 12-18 months, and adequate but
reduced level of liquidity after delayed draw term loans are fully
utilized," said Motoki Yanase, VP - Senior Credit Officer at
Moody's.
Moody's took the following actions:
Affirmations:
Issuer: BW Holding, Inc.
Corporate Family Rating, Affirmed B3
Probability of Default Rating, Affirmed B3-PD
Senior Secured 1st Lien Revolving Credit Facility, Affirmed B2
(LGD3)
Senior Secured 1st Lien Delayed Draw Term Loan B, Affirmed B2
(LGD3)
Senior Secured 1st Lien Term Loan B, Affirmed B2 (LGD3)
Outlook Actions:
Issuer: BW Holding, Inc.
Outlook, Changed To Negative From Stable
RATINGS RATIONALE
The proposed Cenveo acquisition is the largest acquisition that
Brook+Whittle has taken on to date. The acquisition increases the
company's revenue by around 40%, bringing it closer to $500
million, but total debt will also increase by close to 60%. The
Cenveo acquisition will enhance Brook+Whittle's customers base in
the premium labels business, a credit positive, and the company
could improve its leverage below Moody's down-trigger of 6.5x by
year-end 2023, supported by high margin of the acquired business.
Still, acquiring a sizable business shortly after its own LBO
entails meaningful execution risk to integrate the businesses,
attain synergies and maintain profitability.
The B3 corporate family rating reflects Brook+Whittle's focus on
premium labels, which supports high margins. Brook+Whittle uses
various printing technologies and know-how on finishing and cutting
processes to manufacture customized labels with complex decoration.
The company has high profitability - close to 20% EBITDA margin for
the 12 months that ended in September 2021 - which Moody's expects
to improve by 2-3 percentage points over the next several years,
incorporating the proposed acquisition of the custom labels
division of Cenveo. The credit profile also reflects the company's
focus on increasing recyclable products, which helps differentiate
its products and forge customer relationships.
These credit strengths are counterbalanced by the high leverage of
8.4x (pro forma for the company being acquired by Genstar Capital
in December 2021, a few small tuck-in acquisitions after this, and
the proposed Cenveo acquisition). Taking on a significant size of
acquisition within a few months of LBO also represents an
aggressive financial policy. The credit profile is further
constrained by limited free cash flow (FCF) generation that Moody's
expects for the next 12-18 months, small operational scale even
after the acquisition, and limited geographic diversification given
its US operations. The company's liquidity will also deteriorate
after its delayed draw term loans are fully utilized for Cenveo
acquisition.
Moody's expects the company to have adequate liquidity over the
next 12 months. After the proposed LBO and Cenveo custom labels
business acquisition, Moody's expects Brook+Whittle to have limited
cash on hand. Reflecting elevated capital spending, Moody's also
expects FCF to remain around break even for 2022, but liquidity
will be supplemented with full availability on the $50 million
revolver that expires in 2026. To acquire Cenveo business, the
company is drawing full amount on $100 million first lien delayed
draw term loan and $25 million second lien delayed draw term loan
(unrated), which reduces liquidity.
The first-lien term loans, including delayed draw term loan, expire
in 2028. The second-lien term loan will expire in 2029. Annual
amortization on the first-lien term loan is $4 million a year.
There is no amortization for the second-lien term loan.
The revolver has a springing covenant that will take effect from
the second quarter of 2022. The covenant requires maximum
first-lien net leverage ratio of 8.45x when utilization of the
revolver exceeds 35%. There are no financial covenants for the term
loans. Most of the assets are fully encumbered by the senior
secured credit facilities, limiting alternative liquidity sources.
The second-lien term loans, including second-lien delayed draw term
loan, expire in 2029. These loans have no amortization nor
financial covenants.
The first-lien credit facilities, including the revolver, the term
loan (including incremental amount) and the delayed draw term loan
are rated B2, one notch above the corporate family rating. The
higher ratings reflect the priority position of the debt in the
capital structure and the loss absorption provided by the
second-lien term loans. The borrower is BW Holding, Inc., which is
also the reporting entity.
The revolver and the term loans are secured by a first-priority
lien on substantially all the company's assets and stock of the
borrower, its direct and indirect parents (Merion Rose Holdings,
Inc. and Merion Rose, Inc., respectively), and its guarantor
subsidiaries, subject to certain exceptions. The first lien
facilities are guaranteed by the direct and indirect parent
companies and the borrower's existing and subsequently acquired
material and wholly owned domestic subsidiaries.
As for the environmental, social and governance (ESG) factors
considered in the rating, the ratings reflect high governance risk
because of Brook+Whittle's private-equity ownership, which entails
an aggressive financial policy, evidenced by a sizable acquisition
shortly after the initial LBO, and reduced financial disclosure
requirements.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade Brook+Whittle's ratings if the company
expands its customer base and operations, continues to improve its
profitability, and pay down debt. Specifically, Moody's could
upgrade the ratings if debt/EBITDA is sustained below 5.5x and free
cash flow/debt is sustained above 3.5%, while maintaining good
liquidity.
Moody's could downgrade the ratings if the company loses its
customers and fails to expand its business, leading to weaker
credit metrics and liquidity. Specifically, Moody's could downgrade
the ratings if debt/EBITDA rises above 6.5x, EBITDA/interest
coverage is below 2.0x, or liquidity deteriorates.
As proposed, the incremental first lien term loans provide covenant
flexibility that if utilized could negatively impact creditors.
Notable terms include the following:
Incremental debt capacity for the first lien facilities up to the
greater of the provided amount of EBITDA and 100% of consolidated
EBITDA on a pro forma basis for the most recently ended period,
plus unlimited amounts up to the first lien net leverage ratio at
closing (if pari passu secured), up to the secured net leverage
ratio at closing (if secured on a junior basis), and 0.25x outside
secured net leverage at closing or interest coverage ratio of 2.0x
(if unsecured), all calculated on a pro forma basis for the most
recently ended period.
Amounts up to the greater of the provided amount of EBITDA and 50%
of consolidated EBITDA may be incurred for the first lien debt with
an earlier maturity date than the initial term loans, together with
customary bridge loans and customary term A loans.
The credit agreement permits the transfer of assets to
unrestricted subsidiaries, up to the carve-out capacities, subject
to "blocker" provisions which restricts the investments in
unrestricted subsidiaries to the greater of the provided amount of
EBITDA and 50% of consolidated EBITDA calculated on a pro forma
basis for the most recently ended test period.
Non-wholly-owned subsidiaries are not required to provide
guarantees; dividends or transfers resulting in partial ownership
of subsidiary guarantors could jeopardize guarantees subject to
protective provisions which only permit guarantee releases if
subsidiary guarantor ceases to be a restricted subsidiary
(including pursuant to a permitted merger with a subsidiary that is
not a loan party) or becomes an excluded subsidiary as a result of
a single transaction or series of related permitted transactions,
in each case, other than as a result of such subsidiary guarantor
ceasing to be a wholly owned restricted subsidiary by virtue of a
disposition of less than all of its equity Interests owned by the
borrower or any of its restricted subsidiaries (unless such
disposition is a good faith disposition to a bona fide third party
that is not an affiliate of the borrower, for fair market value and
for a bona fide business purpose), (i) such subsidiary guarantor
shall automatically be released from its obligations under the loan
documents, (ii) all security interests created by the security
documents in collateral owned by such subsidiary shall be
automatically released and (iii) in the case of such subsidiary
guarantor becoming an excluded subsidiary, all security interests
created by the security documents in the equity interests of such
subsidiary shall be automatically released.
The credit agreement provides some limitations on up-tiering
transactions, including no agreement shall without the consent of
each lender directly and adversely affected thereby contractually
subordinate the liens on all or substantially all of the collateral
securing the loans to any lien securing any other indebtedness for
borrowed money or to any other indebtedness for borrowed money, in
each case, other than in connection with (I) any indebtedness that
is expressly permitted by the loan documents as in effect on the
effective date (or as later amended in connection with an unrelated
transaction) to either be senior in right of payment to the
applicable loans or be secured by a lien on collateral that is
senior to the lien securing the loans, (II) any
"debtor-in-possession" facility or the use of collateral in any
insolvency proceeding, (III) the implementation of an "asset-based"
revolving credit facility or similar financing or (IV) any
indebtedness with respect to which each then-existing lender with
respect to the applicable class of loans is offered the opportunity
(on a ratable basis) to provide such financing on the same terms
and conditions.
Headquartered in Guilford, Connecticut, Brook+Whittle is a
manufacturer of premium pressure sensitive labels, shrink sleeves,
flexible packaging, and heat transfer labels in the United States.
Brook+Whittle is controlled by Genstar Capital after the fund
acquired most of the shareholdings from another private equity
sponsor in December 2021. Pro forma the acquisition of custom
labels business of Cenveo, the company's revenue will be close to
$500 million based on 2021 numbers.
The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass and Plastic Containers published in
December 2021.
CALIFORNIA ROOFS: Unsecureds Will Get 2% of Claims over 5 Years
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California Roofs and Solar, Inc., filed with the U.S. Bankruptcy
Court for the Eastern District of California a Plan of
Reorganization for Small Business dated April 18, 2022.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $939.46.
The final Plan payment is expected to be paid on July 1, 2027.
At the time of the filing of this case, Debtor's contractor's
license was revoked, as a result of which Debtor was not able to
accept any jobs in excess of $500. Since the filing of the presents
bankruptcy case, Debtor was able to get a new license effective
April 7, 2022 and has already signed up several new projections
which will generate the income sufficient to support a feasible
reorganization plan.
Specifically, Debtor now has an air conditioning installation
project, and anticipates having between 3-4 air conditioning jobs
per month to meet the projections. Furthermore, Debtor is also
considering taking some painting projects, which are estimated to
bring between $3,000 tO $5,000 per project.
This Plan of Reorganization proposes to pay creditors of California
Roofs and Solar, Inc. from Debtor's business income from operating
its residential remodeling and air conditioning service business.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 2% (appx. $10,436.40) cents on the dollar. This
Plan also provides for the payment of administrative and priority
claims.
Class 2(A) consists of the secured claim of Outfront Media, LLC.
Debtor proposes to pay Outfront Media, LLC's $16,188.95 claim over
60 months at 10% interest rate at $343.97 per month, with the first
payment of $343.97 due on the Effective Date, followed by 59
consecutive monthly payments of $343.97 each until the claim is
paid in full.
Class 2(B) consists of the claim of SRS Distribution, Inc. Debtor
proposes to pay SRS Distribution, Inc's $7,220.06 claim over 60
months at 10% interest rate at $153.40 per month, with the first
payment of $153.40 due on the Effective Date, followed by 59
consecutive monthly payments of $153.40 each until the claim is
paid in full.
Class 3 consists of Non-priority Unsecured Creditors. Holders of
general unsecured creditor Class 3 will be paid 2% of such
creditors' claim over 5 years, with the first payment due on the
Effective Date, followed by 59 consecutive monthly payments, each
due on the first day of each month. The monthly payments are
$173.94. See EXHIBIT B-3 for the list of general unsecured
creditors and treatment of their claims.
Class 4 consists of Equity Security Holders of the Debtor. Carlos
Colima is the principal of the Debtor and a 40% shareholder of the
Debtor. Carlos Colima does not hold a pre-petition claim against
the Debtor. Miguel Colima is a 30% shareholder of the Debtor.
Miguel Colima does not hold a pre-petition claim against the
Debtor. Martin Colima is a 30% shareholder of the Debtor. Martina
Colima does not hold a pre-petition claim against the Debtor.
Distribution to creditors under this Plan will be funded primarily
from the following sources: (a) the Debtor's cash on hand on the
Effective Date and (b) the income derived from the continued
operation of the Debtor's business.
This plan proposes to pay creditors using the net income of the
debtor over the five-year period after the Effective Date. This
plan will allow non-insider general unsecured creditors (Class 3)
to recover 2 times more than if the Debtor's assets were sold in a
hypothetical Chapter 7 liquidation and the proceeds paid out to
each Creditor respective creditors. Debtor believes that this Plan
represents the best possible return to holders of claims. The
Debtor believes that this plan will successfully reorganize the
Debtor and that the confirmation of this Plan is in the best
interests of the Debtor, its creditors, and equity interest
holder.
A full-text copy of the Plan of Reorganization dated April 18,
2022, is available at https://bit.ly/3Lh3wBx from PacerMonitor.com
at no charge.
Debtor's Counsel:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Blvd., 6th Floor
Beverly Hills, CA 90212-2929
Telephone: (310) 271-6223
Facsimile: (310) 271-9805
Email: michael.berger@bankruptcypower.com
About California Roofs and Solar
Since September 2014, California Roofs and Solar, Inc., has been in
the business of providing residential remodeling and air
conditioning services.
California Roofs and Solar sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. E.D. Cal. Case No. 22-10061) on
Jan. 17, 2022, listing as much as $1 million in both assets and
liabilities. Carlos Colima, chief financial officer, signed the
petition. Judge Rene Lastreto II oversees the case. Michael Jay
Berger, Esq. at the Law Offices of Michael Jay Berger, is the
Debtor's counsel.
CANADIAN UTILITIES: Egan-Jones Retains 'BB' Sr. Unsecured Ratings
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Egan-Jones Ratings Company, on March 29, 2022, maintained its 'BB'
foreign currency and local currency senior unsecured ratings on
debt issued by Canadian Utilities Limited.
Headquartered in Calgary, Canada, Canadian Utilities Limited
conducts operations in electrical utility services, independent
power production, and retail gas and electricity marketing.
CORESTATE CAPITAL: Creditors Get Debt Restructuring Adviser Pitches
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Laura Benitez of Bloomberg News reports that restructuring advisers
are seeking to get mandates for the potential restructuring of
Corestate, according to people familiar with the matter.
Corestate's creditors are in talks with firms including DC
Advisory, Houlihan Lokey and PJT, according to people familiar with
the matter.
DC Advisory said in pitchbook that there are concerns about the
firms managed funds including: customer concentration, high fees
despite the stated 0% default rate, various loans that sat on
balance sheet for longer than expected.
One of the alternatives being pitched is an amend-and-extend of
Corestate's debt maturities with stronger security for creditors.
About Corestate Capital
Corestate is a niche real estate investment manager, with EUR27.4
billion in assets under management as of Dec. 31, 2021. The company
provides asset, fund, and property management services along the
whole real estate value chain to a mix of institutional,
semi-institutional, and retail clients. It currently invests across
all major real estate asset classes, including residential and
student housing buildings, offices, and retail spaces. Corestate
mainly operates in German-speaking countries, but also
internationally.
DANA INC: Egan-Jones Retains 'BB-' Sr. Unsecured Debt Ratings
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Egan-Jones Ratings Company, on March 29, 2022, maintained its 'BB-'
foreign currency and local currency senior unsecured ratings on
debt issued by Dana Incorporated.
Headquartered in Maumee, Ohio, Dana Incorporated engineers,
manufactures, and distributes components and systems for worldwide
automotive, heavy truck, off-highway, engine, and industrial
markets.
DCIJ BEE HIVE: Court OKs Deal on Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Wisconsin
approved the stipulation filed by DCIJ Beehive, LLC and Citizens
Community Federal, N.A. authorizing the Debtor to use cash
collateral and provide adequate protection.
The Debtor is permitted to utilize cash collateral to fund the
itemized expenses identified in the cash flow budget. The Debtor
will not be authorized to use cash collateral to pay any costs,
fees, or expenses not listed in the Budget without (i) CCF’s
prior written consent or (ii) a court order.
The Debtor and CCF may, in their sole collective discretion, agree
to increase the projected expenditures associated with the Debtor's
business and, upon CCF's written consent, the Debtor will be
authorized to use cash collateral in such agreed amounts without
the need for further Court order. However, the budgeted line items
for an Administrative Expense Allocation and a Sub V Trustee Fee
Allocation are for budgetary purposes only and no payments will be
made to any professionals or the Subchapter V Trustee except upon
appropriate application and after entry of a court order.
The Debtor will make adequate protection payments to CCF in the
amount of $18,227 per month commencing effective April 15, 2022,
and continuing on the 15th of each month thereafter until the
Debtor confirms a Chapter 11 plan. Absent CCF's consent the
Debtor's authority to use cash collateral will terminate if the
Debtor does not file a proposed plan by the first date for the
filing of a plan required under 11 U.S.C. section 1189(b), although
the Debtor may seek Court authorization for the continued use of
cash collateral after that date.
To protect CCF's security interest in cash collateral that existed
on or after the date of the Petition Date, CCF is granted a
post-petition replacement lien on the Debtor's personal property to
the same extent and in the same priority as its prepetition liens.
The CCF Post-petition Lien is perfected as of the Petition Date.
As adequate protection, all other secured creditors, and only to
the extent such creditors hold valid security interests and
properly perfected liens as of the Petition Date under applicable
nonbankruptcy law, are granted post-petition replacement liens to
the same extent, priority, and validity as those held prepetition.
A copy of the order and the Debtor's budget for the period from
April to July 2022 is available at https://bit.ly/3Mro5v4 from
PacerMonitor.com.
The Debtor projects $353,400 in total revenue and $297,910 in total
expenses.
About DCIJ Bee Hive, LLC
DCIJ Bee Hive, LLC is part of the health care industry. DCIJ Bee
Hive sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. W.D. Wis. Case No. 22-10427) on March 25, 2022. In the
petition signed by Daniel Peko, managing member, the Debtor
disclosed up to $50,000 in assets and up to $10 million in
liabilities.
Judge Catherine J. Furay oversees the case.
Evan M. Swenson, Esq., at Swenson Law Group, LLC, is the Debtor's
counsel.
DELAWARE VALLEY: Moody's Affirms Ba1 Issuer & Revenue Bond Ratings
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Moody's Investors Service has revised Delaware Valley University's
(PA) outlook to stable from negative and affirmed its Ba1 issuer
and revenue bond ratings. The university had total debt outstanding
of $31.6 million at fiscal end 2021.
RATINGS RATIONALE
The outlook revision to stable from negative was largely driven by
a strengthening of unrestricted liquidity largely due to favorable
investment returns, which provides runway to manage through
near-term budget challenges. Despite ongoing revenue difficulties,
good budget oversight will contribute to general operating
performance stability and debt service coverage above 1.2x. The
recent introduction of new high demand academic programs and
implementation of other student-focused strategies increase
prospects of stabilizing enrollment and revenue by fiscal 2023.
The affirmation of Delaware Valley University's Ba1 issuer rating
incorporates its market differentiation and low financial leverage
while also acknowledging its student demand challenges and modest
revenue base. Total cash and investments remain well below peer
competitors but provide solid coverage of a moderate debt burden.
However, financial reserve growth will be constrained by thin
operating performance and modest philanthropy. Further, ongoing
exposure to heightened competitive headwinds will continue to
strain pricing flexibility and limit prospects for achieving
material operating performance improvement over the near-term. With
a high reliance on student charges, gaining market traction will
remain critical to the university's ability to sustainably grow
revenue.
The affirmation of the Ba1 revenue bond ratings reflect the general
obligation characteristics of the pledge.
RATING OUTLOOK
The stable outlook reflects Moody's expectations that the
university will adjust budgets accordingly to sustain above 1.2x
debt service coverage. It also incorporates Moody's expectations of
no additional debt and stable liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
Material strengthening in brand and strategic positioning,
reflected in improved student demand, philanthropy, and revenue
growth
Substantial growth in wealth and liquidity providing for stronger
coverage of debt and expenses
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
Deterioration in operating performance leading to an erosion in
debt service coverage
Significant decline in unrestricted liquidity relative to
expenses
LEGAL SECURITY
All bonds are general obligations of the university with a lien on
unrestricted revenue. The bonds are additionally secured by a
mortgage lien on the university's core campus.
The bonds are subject to a 1.1x debt service coverage covenant (net
student charges divided by debt service). However, a breach of this
covenant does not trigger an immediate event of default or
potential acceleration, unless coverage were to be below 1.0x at
the end of a fiscal year. As calculated under the financing
documents, the university projects coverage at 2.0x at fiscal
ending 2022, which includes a one-time $4 million repayment on an
outstanding note.
PROFILE
Delaware Valley University is a small, private, four-year
residential university located in Doylestown, just north of
Philadelphia. The university's market niche in agricultural and
animal sciences attracts about 1,900 full-time equivalent students
and generates $54 million of operating revenue.
METHODOLOGY
The principal methodology used in these ratings was Higher
Education Methodology published in August 2021.
DERBY MOBILE: Wins Cash Collateral Access Thru April 30
-------------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado approved the
Stipulated Order Authorizing the Debtor's Use of Cash Collateral
for the Period from March 24, 2022, through April 30, 2022 filed by
Derby Mobile Home Park, LLC d/b/a Desert Oasis RV Park.
The Debtor is permitted to use cash collateral in accordance with
the budget, with a 15% variance.
The Debtor will pay $10,000 to First Guaranty Bank within three
business days upon Court approval of the Stipulated Cash Collateral
Order.
As adequate protection, the Bank is granted a replacement lien and
security interest upon the Debtor's post-petition assets with the
same priority and validity and in the same amount as its
pre-petition liens and security interests to the extent of the
Debtor's post-petition use of cash collateral.
To the extent the Adequate Protection Lien proves to be
insufficient, the Bank, as may be applicable, will be granted
superpriority administrative expense claims under section 507(b) of
the Bankruptcy Code but only to the extent that the Bank has a
valid allowed secured claim under section 506(a) in the Cash
Collateral used.
A copy of the order is available at https://bit.ly/3vCZw7N from
PacerMonitor.com.
About Derby Mobile Home Park, LLC
Derby Mobile Home Park, LLC owns and operates the Desert Oasis RV
Park located in Eunice, NM having an appraised value of $1.5
million. Derby Mobile sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Colo. Case No. 22-10966) on March
24, 2022. In the petition signed by Brian Tanner, managing member,
the Debtor disclosed $1,519,563 in assets and $6,029,019 in
liabilities.
Judge Elizabeth E. Brown oversees the case.
David J. Warner, Esq., at Wadsworth Garber Warner Conrardy, P.C. is
the Debtor's counsel.
DIOCESE OF CAMDEN: Danziger Represents Sexual Abuse Claimants
-------------------------------------------------------------
In the Chapter 11 cases of The Diocese of Camden, New Jersey, the
law firm of Danziger & De Llano, LLP submitted a verified statement
under Rule 2019 of the Federal Rules of Bankruptcy Procedure, to
disclose that it is representing the Sexual Abuse Claimants.
The names and addresses of the confidential Claimants are available
to permitted parties who have executed a confidentiality agreement
and have access to the Sexual Abuse Claim Forms.
Pursuant to individual fee agreement, DANZIGER was individually
retained by each Claimant listed in Exhibit A to pursue claims for
damages against the Diocese of Camden, New Jersey as a result of
sexual abuse. This includes representing and acting on behalf of
each Claimant in the bankruptcy case.
Each Claimant maintains an individual economic interest against the
Debtor Diocese of Camden, New Jersey that has been disclosed in the
Sexual Abuse Survivor Proof of Claim Forms.
The information set forth in this Verified Statement is intended
only to comply with Bankruptcy Rule 2019 and not for any other
purpose.
Counsel for Claimants can be reached at:
DANZIGER & DE LLANO, LLP
Rodrigo R. de Llano, Esq.
440 Louisiana, Suite 1212
Houston, TX 77002
Telephone: 713-222-9998
Facsimile: 713-222-8866
E-mail: Rod@dandell.com
A copy of the Rule 2019 filing is available at
https://bit.ly/3va8fQ0 at no extra charge.
About The Diocese of Camden, NJ
The Diocese of Camden, New Jersey is a nonprofit religious
corporation organized pursuant to Title 16 of the Revised Statutes
of New Jersey. The Diocese is the secular legal embodiment of the
Roman Catholic Diocese of Camden, a juridic person recognized under
Canon Law.
The Diocese of Camden sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.N.J. Case No. 20-21257) on Oct. 1, 2020.
The petition was signed by Reverend Robert E. Hughes, vicar General
and vice president. At the time of the filing, the Debtor had
total assets of $53,575,365 and liabilities of $25,727,209. Judge
Jerrold N. Poslusny Jr. oversees the case. McManimon, Scotland &
Baumann, LLC, is the Debtor's legal counsel.
DISCOVERY INC: Egan-Jones Retains BB+ Sr. Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company, on March 30, 2022, maintained its 'BB+'
foreign currency and local currency senior unsecured ratings on
debt issued by Discovery, Inc.
Headquartered in New York, New York, Discovery, Inc. provides
non-fiction entertainment.
DISPATCH ACQUISITION: Term Loan Add-on No Impact on Moody's B3 CFR
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Moody's Investors Service said that Dispatch Acquisition Holdings,
LLC's ("Denali") planned add-on to its first lien term loan B is
credit negative. However, the company's ratings, including the B3
corporate family rating and B3 senior secured debt rating, and
stable outlook are unaffected at this time.
Proceeds of the $185 million incremental term loan will be used
primarily to fund a majority portion of the purchase price for
Imperial Western Products ("IWP"), with the balance funded by
equity from sponsor TPG Growth. IWP provides food and organic waste
collection, disposal and recycling services, including the
processing and conversion of waste into sellable by-products such
as animal feed and biofuel. Following the add-on, the aggregate
size of Denali's first lien term loan (due in 2028) will increase
to $637 million. The acquisition is expected to close in the second
quarter of 2022, subject to customary closing conditions.
Moody's views the transaction as credit negative because it will
increase funded debt and leverage, and presents
integration/execution risks. Funded debt will rise by nearly 40%
within a year of the sizable debt-funded acquisition of Organix
Recycling ("Organix"), a food-waste collection and recycling
company, continuing an aggressive growth strategy and financial
policy. The transaction is also occurring amid challenging business
conditions with Denali facing labor availability issues from the
pandemic's effects and inflationary pressures amid supply chain
headwinds. These pressures will likely continue for some time and
have delayed the realization of previously expected earnings
accretion and Organix acquisition synergies. Denali has also
sustained negative free cash flow, albeit partly constrained by
growth capital expenditures. Moody's estimates pro forma adjusted
debt-to-EBITDA to approach a very high 7x, inclusive of Moody's
standard adjustments.
However, Moody's expects leverage to fall towards 6.5x in 2022 and
6.0x well into 2023, driven by earnings growth. This would be aided
by recent price increases along with expectations that Denali will
maintain its high contract renewal rate (90%), as well as new
contract wins and efficiency initiatives. Moody's believes the
company will pause acquisitions to focus on integrating IWP and
tuck-in acquisitions made in 2021. With good execution, Denali
could achieve targeted acquisition synergies over the next 6-12
months. Moody's does not anticipate any meaningful acquisitions in
the near term, noting that failure to improve leverage and free
cash flow will exert downward ratings pressure. Moody's anticipates
free cash flow to improve steadily and turn positive into 2023, on
higher earnings with declining integration costs as acquisitions
are assimilated and with expected moderation in capital
expenditures. Moody's also expects Denali will maintain adequate
liquidity over the next year, with availability on its $60 million
revolving facility balancing modest cash balances.
The acquisition of IWP increases Denali's scale and aligns with its
focus on organic waste and recycling. IWP will expand Denali's
operations to California while bringing difficult-to-obtain
regulatory permits, processing capabilities and new, complimentary
services such as de-packaging. Denali's business model benefits
from steady solid waste volumes, partially driven by increasingly
stringent environmental regulations for waste disposal and
contracts of three to five years on average that provide a source
of recurring revenue.
Dispatch Acquisition Holdings, LLC, based in Russellville, AR,
provides specialty waste and environmental services related to
managing organic waste from several end markets. These markets
include municipal water and wastewater treatment facilities,
industrial food processors and large industrial facilities such as
refineries, chemical, power and pulp and paper plants. The company
also provides waste solutions to the food service and delivery end
markets. Revenue approximated $450 million for the last twelve
months ended December 31, 2021, pro forma for 2021 acquisitions.
Dispatch Acquisition Holdings, LLC is a portfolio company of
affiliates of TPG Growth, LLC, a private equity firm. It was formed
in January 2020 from the merger of American Residuals Group, LLC
(legacy Denali Water Solutions, LLC) and American Industrial
Services Group, LLC, a holding company for Wastewater Specialties,
LLC, an industrial cleaning company.
EVEREST REAL ESTATE: Taps Haselden Farrow as Co-Counsel
-------------------------------------------------------
Everest Real Estate Investments, LLP received approval from the
U.S. Bankruptcy Court for the Southern District of Texas to hire
Haselden Farrow, PLLC to serve as co-counsel with The Gerger Law
Firm, PLLC.
The firm's services include:
(a) advising the Debtor of its powers and duties in the
continued operation of its businesses;
(b) taking all necessary actions to protect and preserve the
bankruptcy estate, including the prosecution of actions on behalf
of the Debtor, the defense of any actions commenced against the
Debtor, negotiations concerning all litigation in which the Debtor
is involved, and objecting to claims filed against the estate;
(c) preparing legal papers;
(d) preparing a disclosure statement and plan of
reorganization; and
(e) performing all other necessary legal services for the
Debtor.
The hourly rates charged by the firm's attorneys and paralegals are
as follows:
Melissa A. Haselden $450
Elyse M. Farrow $350
Paralegal $150
The firm received a retainer in the amount of $10,000.
As disclosed in court filings, Haselden Farrow is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Melissa A. Haselden
Haselden Farrow PLLC
700 Milan, Site 1300
Houston, TX 77002
Phone: (832) 819-1149
About Everest Real Estate Investments
Everest Real Estate Investments, LLP -- www.setexaser.com -- is a
health care services provider established in Humble, Texas,
specializing in general acute care hospital. It offers completely
comprehensive medical care, treating both major and minor
injuries.
Everest Real Estate Investments sought protection under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Texas Case No. 20-34077) on
Aug. 14, 2020, listing as much as $50 million in both assets and
liabilities. Thomas Vo, M.D., majority owner of the Debtor's
managing partner, signed the petition.
Judge Christopher M. Lopez oversees the case.
The Debtor tapped The Gerger Law Firm, PLLC and Haselden Farrow,
PLLC as its legal counsels and Doeren Mayhew CPAs and Advisors as
its accountant.
EYP GROUP: Case Summary & 30 Largest Unsecured Creditors
--------------------------------------------------------
Lead Debtor: EYP Group Holdings, Inc.
201 Fuller Rd., 5th Fl.
Albany, NY 12203
Business Description: EYP is an integrated design firm
specializing in higher education,
healthcare, government and science &
technology.
Chapter 11 Petition Date: April 24, 2022
Court: United States Bankruptcy Court
District of Delaware
Nine affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
EYP Group Holdings, Inc. (Lead Debtor) 22-10367
EYP Holdings, Inc. 22-10368
EYP, Inc. 22-10369
EYP Architecture & Engineering, P.C. 22-10370
EYP Architecture & Engineering of CT, Inc. 22-10371
EYP Architecture & Engineering of NJ, Inc. 22-10372
EYPAE, Inc. TBD
WHR Architecture, P.C. 22-10373
WHR Design, P.C. 22-10374
Judge: Hon. Mary F. Walrath
Debtors'
General
Bankruptcy
Counsel: R. Craig Martin, Esq.
Aaron S. Applebaum, Esq.
DLA PIPER LLP (US)
1201 N. Market Street, Suite 2100
Wilmington, Delaware 19801
Tel: (302) 468-5700
Fax: (302) 394-2341
Email: craig.martin@us.dlapiper.com
aaron.applebaum@us.dlapiper.com
- and -
Richard A. Chesley, Esq.
Oksana Koltko Rosaluk, Esq.
444 West Lake Street, Suite 900
Chicago, Illinois 60606
Tel: (312) 368-4000
Fax: (312) 236-7516
Email: richard.chesley@us.dlapiper.com
oksana.koltkorosaluk@us.dlapiper.com
Debtors'
Special
Counsel: HOLLINGSWORTH LLP
Debtors'
Investment
Banker: CARL MARKS ADVISORY GROUP LLC
Debtors'
Financial
Advisor: BERKLEY RESEARCH GROUP, LLC
Debtors'
Notice &
claims
Agent: EPIQ CORPORATE RESTRUCTURING, LLC
EYP Group Holdings'
Estimated Assets: $50 million to $100 million
EYP Group Holdings'
Estimated Liabilities: $100 million to $500 million
The petitions were signed by Kefalari Mason as authorized officer.
A full-text copy of EYP Group Holdings' petition is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/2SH3RGA/EYP_Group_Holdings_Inc__debke-22-10367__0001.0.pdf?mcid=tGE4TAMA
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Tom Birdsey Unsecured Note $15,613,233
2. Thomas G. McDougall Trust Unsecured Note $5,870,735
3. David Watkins Unsecured Note $5,072,298
4. Marilyn Watkins Unsecured Note $5,072,298
5. Karen Birdsey Unsecured Note $5,000,000
6. Peter Ottavio Unsecured Note $4,790,584
7. Leila Kamal Unsecured Note $4,017,235
8. Estate of Ed Kohlberg Unsecured Note $3,330,377
9. John Kempf Unsecured Note $3,111,203
10. Elissa Kellett Unsecured Note $3,101,837
11. Long Point Capital Unsecured Note $3,000,000
1211 Avenue of the
Americas, 40th Floor
New York, NY 10036
Attn: Ira Starr
Tel: (212) 593-1800
12. William Ganshirt Unsecured Note $2,898,456
13. Michael Johnson Unsecured Note $2,898,456
14. Michael Wortley Unsecured Note $2,898,456
15. Andre Hebert Unsecured Note $2,834,781
16. Charles Cadenhead Unsecured Note $2,300,370
17. Paul King Unsecured Note $2,064,046
18. John R. Baxter Unsecured Note $1,968,155
19. Bradley Horst Unsecured Note $1,866,202
20. Gailand Smith Unsecured Note $1,811,535
21. Melissa Lassor Unsecured Note $1,615,667
22. John Tobin Unsecured Note $1,602,693
23. James Douglas Unsecured Note $1,431,397
24. John M. Myers Unsecured Note $1,428,292
25. David Fixler Unsecured Note $1,078,695
26. David Azziz Eijadi and Unsecured Note $985,475
Barbara Anne
Eijadi Revocable
Trust dated May 27, 2015
27. Jason Steinbock Unsecured Note $951,172
28. John R. Hathaway Unsecured Note $899,037
29. Erik R. Johnson Unsecured Note $799,786
30. Jeremy OberC Unsecured Note $770,133
FLEXIBLE FUNDING: Unsecureds' Recovery "TBD" in Liquidating Plan
----------------------------------------------------------------
Flexible Funding Ltd. Liability Co. ("Flexible") and Instapay
Flexible, LLC ("Instapay") submitted a Disclosure Statement for
their Chapter 11 Joint Plan of Liquidation dated April 18, 2022.
The Debtors are privately held asset-based lending (ABL) and
factoring companies, primarily focused on the staffing and
transportation industries. Instapay is a wholly owned subsidiary of
Flexible Funding. Instapay engages in factoring for clients in the
transportation industry, while Flexible Funding focuses on ABL,
mainly for the staffing industry.
Both before and after the commencement of these chapter 11 cases,
the Debtors engaged in good-faith and arm's-length negotiations for
the sale of their assets. On October 15, 2021, the Bankruptcy Court
entered an order approving notice and bidding procedures for a
potential sale of substantially all the assets of Flexible. On
October 18, 2021, the Bankruptcy Court entered a similar order with
respect to Instapay.
Ultimately, the highest and best offers for the Debtors' assets
were received from affiliates of eCapital Corp. In November 2021,
transactions were closed for the sale of substantially all of the
Debtors' assets. The proceeds from the sales allowed the Debtors to
retire the senior secured indebtedness owed to Umpqua Bank in full.
The remaining sale proceeds provide the primary source of funding
for Distributions under the Plan.
The Plan is a liquidating chapter 11 plan. It provides for the
distribution of the proceeds from the sale of substantially all the
Debtors' assets to all holders of Allowed Claims. The Plan
organizes certain kinds of Claims into Classes, and leaves other
kinds of Claims unclassified, as the Bankruptcy Code requires.
After full payment of Allowed Administrative Expenses, Allowed
Priority Tax Claims, U.S. Trustee fees, Secured Tax Claims, and
Priority Non-Tax Claims, Distributions to be made to holders of
Allowed Claims in the following Classes will be made in a waterfall
fashion, meaning that a higher priority class must be paid in full
first before the next lower priority class will receive any
distribution.
If the amount of Distributable Cash is sufficient to allow a 100%
distribution to holders of Allowed Class 3 and Class 4 Subordinated
Secured Claims, then holders of allowed Class 5 secured claims will
receive a Pro Rata Share of distribution from the remaining
Distributable Cash. If the amount of Distributable Cash is
sufficient to allow a 100% distribution to holders of Allowed Class
5 Claims, then each holder of an Allowed General Unsecured Claim
will receive a Pro Rata Share of the remaining Distributable Cash
on hand. If the amount of the remaining Distributable Cash allows
full payment of all Allowed General Unsecured, then each holder of
an Allowed Interest will receive a Pro Rata Share of the remaining
Distributable Cash on hand.
Class 6 consists of General Unsecured Claims. Each holder of a
Class 6 Allowed General Unsecured Claim shall receive, on or before
the applicable Plan Distribution Date, a Pro Rata Share of the
Distributable Cash remaining after Classes 1 through 5 have been
paid in full accordance with the treatment provided in the Plan to
such Classes. The allowed unsecured claims total $21.9 million.
The estimated recovery for General Unsecured Claims is "TBD",
according to the Disclosure Statement.
Class 7 consists of Interests. On the Effective Date, the holders
of Interests in the Debtors shall have no ability to direct or
control the affairs of the Liquidating Debtors. Holders of
interests, however, shall be permitted to serve on the Oversight
Committee. Unless all holders of Allowed Claims in Classes 1
through 6 are paid in full, holders of Allowed Class 7 Interests
will not receive any payment on their respective Interests.
The Distributable Cash will consist of remaining sales proceeds as
well as recoveries from the pursuit of Estate Claims. For that
reason, the amount of Distributable Cash that will ultimately be
available for distribution to creditors is unknown at this time as
it will depend on the outcome of the pursuit of the Estate Claims.
A full-text copy of the Disclosure Statement dated April 18, 2022,
is available at https://bit.ly/3xVVN7Y from PacerMonitor.com at no
charge.
Attorneys for Debtors:
Jeff P. Prostok
State Bar No. 16352500
Lynda L. Lankford
State Bar No. 11935020
Dylan T.F. Ross
State Bar No. 24104435
FORSHEY PROSTOK LLP
777 Main Street, Suite 1550
Fort Worth, Texas 76102
Telephone: (817) 877-8855
Facsimile: (817) 877-4151
E-mail: jprostok@forsheyprostok.com
llankford@forsheyprostok.com
dross@forsheyprostok.com
About Flexible Funding
Flexible Funding Ltd. and Instapay Flexible LLC filed petitions for
Chapter 11 protection (Bankr. N.D. Tex. Lead Case No. 21-42215) on
Sept. 19, 2021. Judge Mark X. Mullin oversees the cases.
At the time of the filing, Flexible Funding listed $100 million to
$500 million in both assets and liabilities while Instapay listed
as much as $50 million in both assets and liabilities.
Jeff P. Prostok, Esq., and Lynda L. Lankford, Esq., at Forshey &
Prostok, LLP are the Debtors' bankruptcy attorneys.
FORMATION GROUP: Closes Operations After Filing Chapter 11
----------------------------------------------------------
Formation Group has closed operations after filing for bankruptcy
protection for its fund, Axios reported. Founded in 2015, the VC
firm had previously backed audio startup Eva Automation and
HonestBee, an online delivery company.
About Formation Group Fund I LP
Formation Group Fund I LP -- https://www.formationgroup.com/ -- is
a venture capital firm in Palo Alto, California.
Formation Group Fund I LP sought Chapter 11 protection (Bankr. N.D.
Cal.Case No. 22-50302) on April 11, 2022. In the petition filed by
Rei Young Jang, as managing member of the general partner, listed
estimated assets between $10 million and $50 million and estimated
liabilities hetween $1 million and $10 million. Ori Katz, of
Sheppard, Mullin, Richter and Hampton, is the Debtor's counsel.
GML LOGISTICS: Unsecureds Will Get 100% of Claims over 60 Months
----------------------------------------------------------------
GML Logistics, LLC, filed with the U.S. Bankruptcy Court for the
Western District of Pennsylvania a Small Business Plan of
Reorganization dated April 18, 2022.
GML Logistics, LLC is a transportation and or hauling company. The
company was established approximately six years ago, but did not
start operating until May 2021.
The prior company that GML performed services for basically pulled
its' contract that caused GML to experience a reduction in income,
which required the reduction of trucks it used in its' operations
that brought about the filing of the Chapter 11 Bankruptcy.
The Plan proposes to pay administrative and priority claims in full
unless otherwise agreed. The Debtor estimates approximately
$9,724.19 will be paid to general unsecured claims pursuant to the
Plan.
The following lists the classes of the Debtor's General unsecured
Claims and their proposed treatment under the Plan:
* Class 4 consists of the Claim of Funding Metrics. Funding
Metrics will be paid 100% of its' unsecured claim of $9,316.76 to
be paid over a 60 month period for a monthly of $155.28.
* Class 5 consists of the Claim of Capital One Bank. Capital
One Bank will be paid 100% of its' unsecured claim of $407.43 over
a 60 month period at a monthly payment of $6.79.
The Plan will be implemented by the Debtor making monthly payments
in accordance with the confirmed Plan and said payments will be
funded through Debtor's monthly receipt of funds received from its'
operations.
The Debtor's financial projections demonstrate the Debtor's ability
to make all future Plan payments in the aggregate amount of
$2,545.51 during the Plan term (the "Plan Funding").
The final Plan payment is expected to be paid on 5 years after the
Confirmation Order of the Plan sometime in 2027.
A full-text copy of the Plan of Reorganization dated April 18,
2022, is available at https://bit.ly/3xNp2Ka from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Rodney D. Shepherd
PA I.D. No 56914
rodsheph@cs.com
2403 Sidney Street
Suite 208
Pittsburgh, PA 15203
(412) 471-9670
About GML Logistics
GML Logistics, LLC, a transportation and or hauling company, 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.
GWG HOLDINGS: Angry Bondholders Oppose Bankruptcy
-------------------------------------------------
Jeremy Hill of Bloomberg News reports that life insurance bond
seller GWG Holdings Inc. faced stiff opposition from retail
investors -- some of whom had invested their life's savings in the
company's products -- in its first day in bankruptcy court,
kick-starting a contentious case.
GWG, which has historically bought life insurance policies and sold
bonds to small-time investors backed by those policies, filed for
Chapter 11 bankruptcy this week. The company ran low on cash and
missed debt payments after a U.S. Securities and Exchange
Commission probe into its accounting policies and sales practices
chilled its access to capital markets.
About GWG Holdings Inc.
Headquartered in Dallas Texas, GWG Holdings, Inc., conducts its
life insurance secondary market business through a wholly-owned
subsidiary, GWG Life, LLC and GWG Life's wholly-owned
subsidiaries.
GWG Holdings Inc. and affiliates sought Chapter 11 bankruptcy
protection (Bankr. S.D. Tex. Case No. 22-90032) on April 20, 2022.
In the petition filed by Murray Holland, as president and chief
executive officer, GWG Holdings estimated assets between $1 billion
and $10 billion and estimated liabilities between $1 billion and
$10 billion.
The case is assigned to Honorable Bankruptcy Judge Marvin Isgur.
Charles Stephen Kelley, of Mayer Brown LLP, is the Debtor's
counsel.
HECLA MINING: Moody's Ups CFR to B1 & Senior Unsecured Notes to B2
------------------------------------------------------------------
Moody's Investors Service upgraded the Corporate Family Rating of
Hecla Mining Company to B1 from B2, the probability of default
rating to B1-PD from B2-PD and senior unsecured notes to B2 from
B3. The Speculative Grade Liquidity Rating remains SGL-2. The
outlook is stable.
Upgrades:
Issuer: Hecla Mining Company
Corporate Family Rating, Upgraded to B1 from B2
Probability of Default Rating, Upgraded to B1-PD from B2-PD
Gtd Senior Unsecured Global Notes, Upgraded to B2 (LGD4) from B3
(LGD4)
Outlook Actions:
Issuer: Hecla Mining Company
Outlook, Remains Stable
RATINGS RATIONALE
The upgrade acknowledges the strengthening in the company's credit
profile, supported by growing production and declining costs at the
Lucky Friday mine and steady performance at the company's flagship
Greens Creek mine. Hecla's B1 CFR is supported by its good
liquidity, favorable geopolitical footprint with operating assets
located in the US and Canada and low-cost position of its flagship
silver-gold-zinc-lead Greens Creek mine. The rating also benefits
from the long mine life at all 3 operations, ample organic growth
opportunities, significant mineral reserves and geologically
attractive exploration portfolio of assets. The rating is
constrained by the company's modest scale, exposure to volatile
gold, silver, zinc and lead prices, moderate operational diversity,
high gross debt levels for the company size, high cost position of
the Casa Berardi mine and asset concentration risk with Greens
Creek mine in Alaska, which is expected to generate 45-50% of
revenues and more than 50% of gross profit in 2022.
The company's silver all-in sustaining costs (AISC) declined in
2021 to $9.19/oz from $11.37/oz in 2020 on materially higher
production at the Lucky Friday mine and lower operating costs, as
well as higher zinc and lead by-product credits at both Lucky
Friday and Greens Creek mines. The Casa Berardi mine delivered
higher gold production and modestly lower operating costs in 2021.
The Greens Creek mine is expected to have another year of strong
operational performance and substantial free cash flow in 2022
despite lower production and higher costs, which are contingent in
part on realized zinc and lead prices.
Lucky Friday silver production is guided to increase by 20% in 2022
with silver AISC estimated to fall to $7.25-9.25/oz range from
$14.34/oz in 2021 benefitting from higher grades and building on
the successful implementation of the new Underhand Closed Bench
(UCB) mining method that is expected to further improve seismicity
management, increase mining rates and bring down operating costs.
Lucky Friday silver production is expected to grow to above 5moz in
the next few years. That said, mining at depth poses some risk to
operations given the history of seismic events at the mine. Strong
performance at the Greens Creek and Lucky Friday mines is expected
to offset slightly lower gold production and higher operating and
sustaining capital costs at the Casa Berardi mine.
Assuming gold price of $1,800/oz, silver price of $22/oz, lead and
zinc prices of $1.30/lb and $1.00/lb, respectively, which are
mostly well below spot prices, we estimate that EBITDA, as adjusted
by Moody's, will reach $200 million and leverage could increase to
2.7x in 2022. Under this scenario, free cash flow is forecast to be
around $30 million in 2022. EBITDA could exceed $250 million and
leverage could remain around or fall below 2x in 2022 if the
company realizes gold and silver prices of about or above $1,900/oz
and $23/oz, respectively, and assuming lead and zinc prices do not
decline materially from current levels. Moody's would also expect
the company to generate at least $80 million in positive FCF under
this price scenario in 2022. Hecla consistently hedges its longer
dated zinc and lead production and as of 2021 year-end, the company
had hedged about 40-45% of its planned 2022-2023 zinc and lead
production at approximately $1.29/lb zinc and $0.99/lb lead
prices.
The stable outlook reflects Moody's expectations that Hecla will
continue to safely grow silver production and reduce costs at the
Lucky Friday mine and maintain strong operating performance at the
Greens Creek mine, which should improve the company's ability to
withstand the volatility in metal prices given the high cost
position of the Casa Berardi mine. The outlook also assumes that
Hecla will remain free cash positive and will maintain its good
liquidity position.
Hecla faces a number of ESG risks, typical for a mining company,
including but not limited to environmental and asset retirement
obligations, water management and water rights and litigation
matters associated with the acquisition of Nevada operations.
Hecla's CIS-3 (moderately negative) Credit Impact Score reflects
its highly negative exposure to environmental and social risks, and
moderately negative exposure to governance considerations. Overall,
the ESG risks do not have a material impact on the credit rating.
Hecla's E-4 (highly negative) environmental issuer profile score
(IPS) reflects its highly negative exposure to natural capital,
water management and waste and pollution risks. Gold and silver
mining operations, particularly, open pit mines require high energy
intensity and tend to cause a significant impact on water, air and
land resources. The natural capital risk is lower for Hecla as
compared to a very high sector level risk, because, unlike most of
its peers, Hecla operates mainly underground mines, which have a
small footprint and cause a relatively modest impact on the
ecosystem. The only exception is Casa Berardi mine which is an
underground/open pit gold mining complex.
Hecla's S-4 (highly negative) IPS reflects its highly negative
exposure to health & safety, responsible production and human
capital risks. Hecla's G-3 (moderately negative) governance IPS
reflects its moderately negative exposure to financial strategy
risk as well as the management credibility and track record,
somewhat balanced by neutral-to-low risks associated with its board
structure, policies and procedures as well as compliance &
reporting matters. The company had taken unsuccessful M&A actions
in the past but has followed a more conservative financial policy
in the last 3 years that strengthened its balance sheet.
Hecla's SGL-2 rating reflects the company's good liquidity profile
with $210 million in cash and cash equivalents as of 2021 year-end
and $233 million (net of L/Cs) available under the undrawn $250
million revolving line of credit (RCF). The company generated $100
million in Moody's-adjusted free cash flow (after dividend
payments) in 2021 and is expected to remain FCF positive in 2022.
The RCF is secured by assets of some of Hecla's Nevada
subsidiaries, Casa Berardi mine, the company's assets in the Greens
Creek mine JV and equity interests in certain domestic
subsidiaries. Moody's does not expect the company to draw on the
revolver unless gold and silver prices decline materially and
sustain at low levels for an extended period of time. Financial
covenants include a secured leverage ratio (debt secured by
liens/EBITDA) of no more than 2.5x, a minimum interest coverage
ratio of 3x and a leverage ratio (total debt minus unencumbered
cash/EBITDA) of no more than 4x. Moody's expects the company to
remain in full compliance with the covenants.
Under Moody's Loss Given Default for Speculative-Grade Companies
methodology, the B2 rating on the senior unsecured notes, one notch
below the CFR, reflects their lower priority position in the
capital structure and their effective subordination to the RCF
(unrated). The notes are guaranteed on a senior unsecured basis by
the majority of the company's subsidiaries. Non-guarantor
subsidiaries represented about 5% of Hecla's total assets as of
December 31, 2021 and the de minimis amount of revenues.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade would be considered if the company reduces gross debt
levels, improves operating performance at the Casa Berardi mine,
reduces costs as planned at the Lucky Friday mine and further
solidifies its ability to generate sustained positive free cash
flow at various commodity prices. Quantitatively, Moody's would
consider an upgrade if the company maintains EBIT margin of at
least 12%, interest coverage ratio of at least 3.5x and reduces
gross debt levels such that leverage, as adjusted by Moody's,
remains below 3.0x (debt/EBITDA) at various gold and silver
prices.
A negative rating pressure could develop if free cash flow were
expected to be negative on a sustained basis, if the company
experiences material operational issues at its mines which could
result in lowered production and higher costs or if the company
engages in a material debt-financed M&A activity. Quantitatively,
Moody's would consider a downgrade if the leverage ratio increases
to and is sustained above 4x and (CFO - Dividends)/Debt) declines
below 20% of outstanding debt. A significant reduction in borrowing
availability or liquidity could also result in a downgrade.
The principal methodology used in these ratings was Mining
published in October 2021.
Headquartered in Coeur d'Alene, Idaho, Hecla Mining Company
("Hecla") is primarily a silver and gold producer with zinc and
lead by-products. The company operates mines in Alaska (Greens
Creek), Idaho (Lucky Friday) and Quebec Canada (Casa Berardi) and
owns Mexico (San Sebastian) and Nevada mines as well as multiple
other exploration and pre-development properties, including the
geologically prospective Rock Creek and Montanore projects in
Montana. For the twelve months ended December 31, 2021, Hecla
generated revenues of $807 million.
HLMC TITLE: Gets Cash Collateral Access Thru May 13
---------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized HMLC Title Services, Inc. to use the
cash collateral of Sapient Providence, LLC to make payments as
contemplated in the Amended Budget filed on April 21, 2022.
The Debtor was directed to make adequate protection payments to
Sapient on or before April 22.
The authorization to use cash collateral expires at 5:00 p.m. on
May 13.
A further hearing on the matter is scheduled for May 12 at 9:30 am
via Zoom.
A copy of the order is available at https://bit.ly/3xOisTQ from
PacerMonitor.com.
About HMLC Title Services, Inc.
HMLC Title Services, Inc. was organized as an Illinois corporation
in 2012. HMLC operates from 1147 W. 175th Homewood, Illinois 60430.
It owns a real property located at 17532-42 Dixie Highway,
Homewood, Illinois 60430, where it operates a strip mall. The
Property consists of four Permanent Index Numbers namely,
29-31-112-027-0000, 9-31-112-025-0000, 29-31-112-010-0000, and
29-31-112-002-0000.
HMLC sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. N.D. Ill. Case No. 22-02518) on March 4, 2022. In the
petition signed by Rajei J. Haddad, president, the Debtor disclosed
up to $50,000 in assets and up to $1 million in liabilities.
Judge Deborah L. Thorne oversees the case.
Laxmi P. Sarathy, Esq., at Whitestone, P.C., is the Debtor's
counsel.
ICAHN ENTERPRISES: Moody's Alters Outlook on 'Ba3' CFR to Stable
----------------------------------------------------------------
Moody's Investors Service has affirmed the Ba3 corporate family
rating and guaranteed senior unsecured debt ratings of Icahn
Enterprises LP (IEP). The outlook on the ratings was changed to
stable from negative.
A summary of the rating actions are as follows:
Issuer: Icahn Enterprises LP
Corporate Family Rating, affirmed at Ba3
Probability of Default Rating, affirmed at Ba3-PD
Backed Senior Unsecured Notes, affirmed at Ba3
Outlook Actions
Issuer: Icahn Enterprises LP
Outlook, changed to Stable from Negative
RATINGS RATIONALE
The stable outlook on IEP's ratings reflects the improving
operating performance of the company's main segments, the downtrend
in its market value-based leverage (MVL) and solid liquidity
profile.
Increasing consumer demand and higher commodity prices have
improved the operating performance of the Energy segment. Moody's
forecast that the refining and marketing sector will continue to
operate profitably in 2022 due to improved crack spreads and higher
demand despite the military conflict in Ukraine. Although
compliance costs will continue to weigh on the sector's
profitability, IEP's energy subsidiaries are pushing into renewable
fuels and related initiatives that promise significant carbon
credits that could offset its energy compliance costs.
Additionally, the years' long restructuring of the Automotive
sector has unlocked considerable value that has contributed
positively to the trajectory of IEP's MVL.
IEP's MVL remains elevated for its rating profile but its downward
trend is credit positive as it reflects higher valuations for IEP's
holdings. At year-end 2021, the company's MVL stood at about 45%
which is consistent with its rating.
Although continued market volatility could keep MVL elevated and
thus pressure on IEP's ratings; the company has maintained ample
liquidity at the holding company. With over $1.7 billion in cash
and about $4.2 billion in liquid securities within its Investment
Funds segment, IEP has ample liquidity to service its debt and
support its operating companies .
IEP's Ba3 corporate family rating reflects the risks associated
with its activist investment strategy, high MVL and low interest
coverage ratio. Offsetting these risks are its investment track
record, brand recognition and solid liquidity profile.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The factors that could lead to an upgrade of IEP's ratings include:
1) market value-based leverage that is sustained below 30%; or 2)
there is a shift in the investment portfolio towards less
concentrated positions of higher credit quality; or 3) the dividend
capacity improves for subsidiaries outside the energy segment.
Conversely, IEP's ratings could be downgraded if: 1) there is a
significant deterioration in valuations or credit strength of the
operating subsidiaries; or 2) if there is an increase in net debt;
or 3) a significant decline in the liquidity sources of the holding
company.
The principal methodology used in these ratings was Investment
Holding Companies and Conglomerates published in July 2018.
IMAX CORP: Egan-Jones Keeps BB- Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company on March 31, 2022, maintained its 'BB-'
foreign currency and local currency senior unsecured ratings on
debt issued by IMAX Corporation.
Headquartered in Mississauga, Canada, IMAX Corporation offers
end-to-end cinematic solution combining proprietary software,
theater architecture, and equipment.
INDIANA FINANCE: Moody's Rates Series 2022A/B Revenue Bonds 'Ba2'
-----------------------------------------------------------------
Moody's Investors Service has assigned a Ba2 rating to the Indiana
Finance Authority's Educational Facilities Revenue Bonds, Series
2022A (Indiana Math and Science Academy-North Indianapolis Inc.
Project) and Taxable Educational Facilities Revenue Bonds, Series
2022B (Indiana Math and Science Academy-North Indianapolis Inc.
Project). The bonds have an expected par value of $12 million and
$200 thousand respectively. The outlook is stable.
RATINGS RATIONALE
The Ba2 rating assignment reflects the Indiana Math and Science
Academy-North's (IMSA) generally stable enrollment and likelihood
of moderate growth. The rating also reflects IMSA's broad
Indianapolis service areas which includes strong competition from a
large number of traditional public and charter school options.
The school's demonstrated ability to manage competition will be
challenged by historically poor academic performance that has
recently improved from very low levels and is showing some
indications of weakening as a result of COVID-driven learning loss.
The short-term impact of the learning loss school's charter renewal
appears limited as both the state and the authorizer have shown
leniency in recognition of the effects of the pandemic. As a
result, charter renewal is expected in 2024. The credit profile
benefits from an established history of charter renewal and has
solid prospects for additional renewal.
The financial performance of IMSA shows currently satisfactory
liquidity, coverage and stable operations. These factors will be
challenged by a strong increase in debt resulting from the current
issue. The rating also considers IMSA's adequate legal covenants
and governance, which is a key driver for all initial ratings and
is a key component to managing the charter renewal process.
RATING OUTLOOK
The stable outlook reflects Moody's expectation that IMSA will
avoid material enrollment declines and effectively manage the
charter renewal process. The outlook also anticipates that cash and
coverage will remain in line with the rating and that the
renovation project will be completed on time and foster some
additional enrollment growth.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
Sustained operating surpluses that result in material improvement
to liquidity and coverage
Steady and material enrollment growth
Consistent improvement to academic outcomes and stronger
competitive profile
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
Operating deficits that drive declines to debt service coverage
and liquidity
Deterioration of academic performance resulting in pressure on
charter renewal
Enrollment declines
LEGAL SECURITY
The bonds are issued by the Indiana Finance Authority but are not a
debt, liability or general obligation of the IFA.
The bonds will be payable and secured by the Trust Estate, which
consists of gross revenues and amounts derived from recourse to the
mortgage including land.
USE OF PROCEEDS
Proceeds of the sale will be used to acquire IMSA's currently
leased facility and finance a renovation project that will add ten
classrooms and other facilities totaling approximately 14,000
additional square feet to the existing 80,000 square feet of
space.
PROFILE
Indiana Math and Science Academy-North was incorporated in 2008 and
opened in 2010-11. The school opened as a K-8 facility and then
added one grade per year until it reached grades K-12 in 2014-15.
IMSA operates pursuant to charter authorized by the Mayor's office
of Indianapolis. The charter was initially granted for a period of
seven years in 2010 and has since been renewed once with current
expiration date of June 30, 2024. Current enrollment is
approximately 677 students.
METHODOLOGY
The principal methodology used in these ratings was US Charter
Schools published in September 2016.
INFOW LLC: Court Postpones Alex Jones' Trial After Ch.11 Filing
---------------------------------------------------------------
Craig Huber of the Associated Press reports the Austin trial of
media personality and conspiracy theorist Alex Jones was postponed
Wednesday, April 20, 2022, by a district judge after three
companies tied to Jones filed for bankruptcy protection. Among
them is the well-known InfoWars.
The trial had been set to begin next week and was to determine how
much Jones has to pay the families of two Sandy Hook mass shooting
victims.
Travis County District Judge Maya Guerra Gamble ordered the delay
just two days after the bankruptcy filings, the Associated Press
reported.
Jones has lost defamation lawsuits in Texas and Connecticut over
his comments that the 2012 Sandy Hook Elementary School massacre
was a hoax. The first trial over how much he should pay the
families had been scheduled to begin Monday in Austin, where
InfoWars is headquartered.
A new trial date has not been set. A judge in Connecticut also
paused all proceedings surrounding defamation lawsuits against
Jones in that state after the bankruptcy filing.
Attorneys for Sandy Hook families have accused Jones of trying to
hide millions of dollars in assets. Creditors listed in InfoWars’
bankruptcy filing include relatives of some of the 20 children and
six educators killed in the 2012 school massacre in Connecticut.
About InfoW LLC
InfoW LLC, also known as InfoWars, is an American far-right
conspiracy theory and fake news website that is owned by Alex
Jones. It is a lessor of nonfinancial intangible assets.
InfoW LLC sought Chapter 11 bankruptcy protection (Bankr. S.D. Tex.
Case No. 22-60020) on April 18, 2022 together with affiliates,
IWHealth, LLC and Prison Planet TV LLC. In the petition filed by W.
Marc Scwartz, as chief restructuring officer, InfoW LLC listed
estimated assets between $0 and $50,000 and estimated liabilities
between $1 million and $10 million.
The case is assigned to Honorable Bankruptcy Judge Christopher M.
Lopez.
Kyung Shik Lee, of Parkins Lee & Rubio LLP, is the Debtor's
counsel.
INFOW LLC: DOJ Warns Bankruptcy May Be Abuse of Federal Court
-------------------------------------------------------------
Steven Church of Bloomberg Law reports that the Department of
Justice (DOJ) warns that Infoars bankruptcy may be abuse of federal
court.
An arm of the U.S. Justice Department cast doubt on far-right radio
host Alex Jones's use of bankruptcy as three companies he once
owned prepare for their first day in court Friday.
The DOJ's bankruptcy watchdog, known as the U.S. Trustee, said the
companies' Chapter 11 filing "raises numerous questions -- the
answers to which may demonstrate these cases are an abuse of the
bankruptcy system," according to court papers filed Thursday. The
U.S. Trustee urged a federal judge in Texas to reject a request to
appoint former judges to oversee a proposed victim compensation
fund.
About InfoW LLC
InfoW LLC, also known as InfoWars, is an American far-right
conspiracy theory and fake news website that is owned by Alex
Jones. It is a lessor of nonfinancial intangible assets.
InfoW LLC sought Chapter 11 bankruptcy protection (Bankr. S.D. Tex.
Case No. 22-60020) on April 18, 2022 together with affiliates,
IWHealth, LLC and Prison Planet TV LLC. In the petition filed by W.
Marc Scwartz, as chief restructuring officer, InfoW LLC listed
estimated assets between $0 and $50,000 and estimated liabilities
between $1 million and $10 million.
The case is assigned to Honorable Bankruptcy Judge Christopher M.
Lopez.
Kyung Shik Lee, of Parkins Lee & Rubio LLP, is the Debtor's
counsel.
INNERLINE ENGINEERING: Wins Cash Collateral Access Thru Sept 30
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Riverside Division, authorized Innerline Engineering, Inc. to use
cash collateral in accordance with the budget, with a 15% variance
through September 30, 2022.
The Debtor is directed to provide adequate protection to secured
creditors by making monthly payments through September 30, 2022 as
follows:
HOP Capital: $3,000
Danny Song: $1,000
U.S. Small Business Administration $731
Internal Revenue Service $5,207
The Debtor acknowledges the secured creditors hold valid,
pre-petition liens secured by the cash collateral used by the
Debtor post-petition. The Debtor proposes to grant them
replacement liens on all of the Debtor's post-petition revenues to
the same extent, priority and validity (if any) that their liens
attached to the cash collateral. The amounts of the replacement
liens are limited to the amounts (if any) that cash collateral
diminishes post-petition as a result of the post-petition use of
cash collateral by the Debtor.
The Debtor is prohibited from using cash collateral to pay insiders
unless and until the Debtor has satisfied all requirements under
the Bankruptcy Code and the U.S. Trustee's guidelines for payment
to insiders.
A copy of the order is available at https://bit.ly/36AZ8hM from
PacerMonitor.com.
About Innerline Engineering
Corona, Cal.-based Innerline Engineering, Inc. --
http://www.innerlineengineering.com/-- offers a variety of
services to municipalities, utility owners, industrial facilities
and commercial property owners for the maintenance of their
underground utilities.
Innerline Engineering first filed a petition for Chapter 11
protection under Subchapter V (Bankr. C.D. Cal. Case No. 21-11349)
on March 16, 2021, listing under $10 million in both assets and
liabilities. Thomas J.C. Yeh, chief financial officer, signed the
petition. Judge Wayne E. Johnson, who presided over the case,
entered a dismissal order on March 31, 2021, for "failure to file
schedules, statements, and/or plan."
Innerline Engineering again filed a petition for Chapter 11
protection (Bankr. C.D. Cal. Case No. 21-14305) on Aug. 9, 2021,
also listing under $10 million in both assets and liabilities. Yeh
signed the petition. Judge Johnson, who also presided over the
case, entered a dismissal order on Jan. 28, 2022. The 2021 case
was closed on March 22, 2022.
Innerline Engineering filed a third Chapter 11 petition (Bankr.
C.D. Cal. Case No. 22-10545) on Feb. 14, 2022, before Judge
Johnson. Resnik Hayes Moradi LLP serves as the Debtor's bankruptcy
counsel in the 2022 case as well as in the 2021 cases.
J & J CONSULTING: Taps Peter Kravitz of Province Partners as CRO
----------------------------------------------------------------
J & J Consulting Services, Inc. seeks approval from the U.S.
Bankruptcy Court for the District of Nevada to hire Peter Kravitz
of Province Partners, LLC as its chief restructuring officer.
The Debtor requires a restructuring advisor to:
a) disclose to the bankruptcy court any conflicts between the
Debtor and its affiliate, J and J Purchasing, LLC, over the course
of the retention;
b) be the sole responsible party and signatory for each of the
Debtor's banking and financial accounts;
c) supervise and direct all action taken by the Debtor in its
Chapter 11 case;
d) locate and take possession and control of all assets of the
Debtor;
e) direct all business and operational matters of the Debtor;
f) act as the designated responsible person for the Debtor in
its case;
g) direct the preparation of all financial information
relative to the Debtor, including statements of financial affairs
and bankruptcy schedules required to be filed by the Debtor in the
case;
h) approve all cash disbursements;
i) direct the investigation of all misfeasance, malfeasance
and nonfeasance by persons that owe or owed duties to the Debtor,
including but not limited insiders and affiliates;
j) direct all legal actions to protect the Debtor's bankruptcy
estate and interest of the creditors, including the prosecution of
all civil actions against insiders, affiliates and third parties;
k) cooperate with law enforcement, regulatory agencies and
their agents, and other persons enforcing state or federal police
power by providing information to their investigations, subject to
reasonableness and proportionality;
l) supervise and direct the management of the Debtor's
communications with creditors, investors, lenders and third
parties;
m) direct and approve the disposition of physical assets of
the Debtor in the ordinary course or with bankruptcy court
approval;
n) retain or terminate any employees, contractors or
professionals relative to the Debtor;
o) participate in meetings with third parties and their
respective representatives on all material matters related to the
Debtor;
p) hire any professionals for the Debtor;
q) communicate with the Debtor's legal counsel in any pending
or future legal matters involving the Debtor as a party in
interest, and negotiate resolution of any such matters;
r) pursue, settle, resolve or otherwise make all decisions
relative to any claim for or against the Debtor or any of its
affiliates, subject to such approvals as may be required by the
Bankruptcy Code;
s) communicate with any committees, investor groups,
creditors, lenders and the bankruptcy court, related to the
Debtor;
t) communicate with regulators relative to the activities of
the Debtor and its affiliates; and
u) take other actions necessary to fulfill its
responsibilities, including executing all necessary documentation.
The monthly fee for the services is $50,000.
As disclosed in court filings, Mr. Kravitz and his firm are
"disinterested" within the meaning of Section 101(14) of the
Bankruptcy Code.
The CRO can be reached at:
Peter Kravitz
Province Partners, LLC
2360 Corporate Circle, Suite 340
Henderson, NV 89074
Phone: +1 (702) 685-5555
Email: pkravtiz@provincefirm.com
About J & J Consulting Services
A group of creditors, including Keith Ozawa, Anthony Bonifazio,
Brian Schumann, and Martin Keevin Cordova, filed an involuntary
petition under Chapter 11 of the Bankruptcy Code against J & J
Consulting Services, Inc., a company in Henderson, Nev. (Bankr. D,
Nev. Case No. 22-10942) on March 17, 2022. The creditors are
represented by Samuel A. Schwartz, Esq., at Schwartz Law, PLLC.
Judge Mike K. Nakagawa presides over the case.
Garman Turner Gordon, LLP and Province Partners, LLC serve as the
Debtor's legal counsel and restructuring advisor, respectively.
Peter Kravitz of Province Partners is the Debtor's chief
restructuring officer.
JADEX INC: Moody's Affirms 'B2' CFR & Alters Outlook to Negative
----------------------------------------------------------------
Moody's Investors Service affirmed Jadex Inc.'s B2 Corporate Family
Rating, B2-PD Probability of Default Rating, and B2 senior secured
credit facility rating. The outlook has been changed to negative
from stable.
The outlook change to negative reflects uncertainty in efficiently
and effectively passing along cost inflation, given the lack of a
track record as a stand-alone company. Lack of recent success has
pressured financial leverage above expectations to over 7.0x
adjusted debt to EBITDA, which was already elevated given an
aggressive financial policy and history of debt financed dividend.
However, the company has adopted a more proactive pricing approach
in 2022 to absorb future inflationary pressures that, if executed
well, is expected to benefit EBITDA and debt leverage.
"EBITDA improvement in 2022 and 2023 is contingent on effectively
combating cost inflation with sufficient and timely pricing
actions, as well as, benefits from recent growth capital
expenditure initiatives", said Scott Manduca, Vice President at
Moody's.
Rating Actions:
Issuer: Jadex Inc.
Corporate Family Rating, Affirmed at B2
Probability of Default Rating, Affirmed at B2-PD
Senior Secured 1st Lien Bank Credit Facility, Affirmed at B2
(LGD3)
Outlook Actions:
Issuer: Jadex Inc.
Outlook, changed to Negative
RATINGS RATIONALE
Jadex's B2 Corporate Family Rating reflects the company's small
scale (revenue), high leverage, aggressive financial policy, low
EBITDA margin, minimal free cash flow, and limited track record as
a stand-alone company. With a more proactive approach to passing
along input cost and other inflation through pricing actions, and
benefits from new business and growth capital expenditure
initiatives, Moody's expect EBITDA improvement and lower debt
leverage.
Moody's B2 rating also reflects Jadex's extensive material science
capabilities and diversified business mix primarily serving
relatively stable end markets including consumer products, food,
and healthcare. Only a minority portion of the company's business
(-11%) is exposed to the automotive, infrastructure, and industrial
sectors, which have more cyclical characteristics. In addition,
Jadex manufactures zinc and steel-based coinage for governments
that further diversifies its portfolio. The company's material
science capabilities enable the Jadex to provide exclusive customer
solutions across its portfolio, including sustainability advantages
in the packaging space and innovative solutions in the medical
segment, which create stickiness with customers and barriers to
entry.
The negative outlook reflects execution risk in effectively
implementing sufficient pricing actions to combat cost inflation,
which is paramount to generating EBITDA improvement.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if there is sustainable improvement
in credit metrics and cashflow, and a less aggressive financial
policy is exercised. Specifically, debt-to-adjusted EBITDA is
sustained below 5.0x, adjusted EBITDA-to-interest is above 3.5x,
and free cash flow to debt is sustained above 4.0%.
The rating could be downgraded if there is a deterioration in
credit metrics or liquidity. Specifically, if debt-to-adjusted
EBITDA is sustained above 6.0x, adjusted EBITDA-to-interest is
below 2.5x, and free cash flow-to-debt is below 1.0%.
Jadex Inc., headquartered in Greenville, SC, is a manufacturer of
rigid and flexible plastic packaging and zinc and steel-based
products. Jadex is a portfolio company of One Rock Capital Partners
LLC.
The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass and Plastic Containers published in
December 2021.
JCB TRUCKING: Gets Court Nod to Use Cash Collateral
---------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Indiana
authorized JCB Trucking Enterprises LLC and JKM Storage and Rentals
LLC to use cash collateral on an final basis to pay weekly expenses
consistent with the proposed budget.
The Court held that all payments made to First Merchants Bank and
M&K Truck Leasing LLC pursuant to the Budget are made without
prejudice to any party's ability to later contest how the payments
are applied or whether the payments are for a true lease or a
secured financing arrangement.
As adequate protection for the use of cash collateral,
notwithstanding section 552 of the Bankruptcy Code, the lien of
First Merchants and any other creditor with a lien upon what is or
what may become cash collateral, will continue to attach to
post-petition property to the same extent and with the same
priority, as to each specific Debtor, as if the petition had not
been filed.
A copy of the order and the Debtor's 13-week budget is available at
https://bit.ly/3Mqasww from PacerMonitor.com.
The Debtor projects $14,076 in total expenses for the period.
About JCB Trucking Enterprises LLC
JCB Trucking Enterprises LLC is a privately held company in the
general freight trucking industry. The Debtor sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Ind. Case
No. 22-40047) on March 18, 2022. In the petition signed by Michael
C. Bloom, member, the Debtor disclosed up to $50,000 in assets and
up to $10 million in liabilities.
Judge Robert E. Grant oversees the case.
Sarah L. Fowler, Esq., at Overturf Fowler LLP is the Debtor's
counsel.
JEM HOMES: Amends Unsecured Creditors Claims Pay Details
--------------------------------------------------------
JEM Homes International, LLC, submitted a Fourth Amended Small
Business Plan of Reorganization dated April 18, 2022.
This Plan of Reorganization proposes to pay creditors from sources
of payment, such as a Capital Investment, as well as cash flow and
future income from operations over three to five years.
Unsecured creditors will be given the opportunity to receive a
reduced lump sum payment on the Effective Date or a full payment of
their claim through equal monthly payments.
Subject to the acceptance of the final terms of the operating
agreement between the Capital Investor and the Debtor's
principal("KRMB Operating Agreement") and the execution of an
employment contract among Debtor's Principal, Mr. Roy Dan, Debtor
and KRMB, that is satisfactory to KRMB Holdings, LLC and the
Capital Investor, in its sole discretion, ("Roy Dan Employment
Agreement"), the Debtor will fund the Plan with funds from the
Capital Investor in accordance with this Plan and subject to the
Investment Cap Amount. Such funding will be in consideration of the
Debtor's principal ceding, to the Capital Investor, 75% of his
interest in the Debtor directly or indirectly through KRMB, which
shall be owned by Debtor's current principal, Mr. Roy Dan, and the
Capital Investor and others and which will ultimately own 100% of
Debtor.
The Capital Investor will make a capital contribution to KRMB equal
to the amount of Debtor's required payments on the Effective Date
under this Plan, but in no event in excess of the Investment Cap
Amount, at least 5 days prior to confirmation hearing of this Plan
(but in no event prior to the execution of the KRMB Operating
Agreement and Roy Dan Employment Agreement). KRMB will transfer, at
least 5 days prior to confirmation hearing of this Plan, the lesser
of the total amount of funds needed to complete the Debtor's
required payments that are due on the Effective Date under this
Plan, or the Investment Cap Amount, to the Escrow Agent.
Class 3 consists of General Unsecured Claims. If Claim is allowed,
Creditor will elect between:
* a) receiving 75% of the total identified in this table as
the Value of the Claim, on the Effective Date; or
* b) 100% of the allowed claim to be paid in one payment of
50% of the total identified in this table as the Value of the
Claim, on the Effective Date, and the remainder to be paid in equal
monthly instalments during a 3-year period, plus an additional 3.5%
interest per annum, to be calculated from the Effective Date
forward and to be paid semiannually.
Creditors who do not elect one of the options will be receiving 75%
of the total identified as the Value of the Claim, on the Effective
Date.
Class 4 consists of the Secured Claims of Wright Brothers. Secured
Portion of each Claim will be paid through an equal interest only
payment, during the first 36 months, at 4% interest per annum. The
total amount identified as the Value of the Claim will be paid in
the earlier of month 60 or the sale of each lot based on the
Release Price.
Class 5 consists of the Secured Claims of Pawnee Leasing and
Crestmark Vendor. Contract to be assumed and arrears, which are
equal to the amounts identified as Value of the Claim are to be
paid on the Effective Date.
Class 6 consists of General Unsecured Claims of Architechenburo
Sibilo NV in the amount of $90,000.00. Amount identified as the
Value of the Claim is to be paid, directly from the Debtor, to the
creditor, in equal payments during the first 36 months, as full
payment of the Judgement the Creditor obtained against the Debtor.
Class 8 consists of the Secured Claims of Centra Leasing and
Ascentium Capital. Amounts identified as the Value of the Claim are
to be paid to each creditor on the Effective Date in exchange for
bill of sales of the equipment secured by the claim.
Subject to the acceptance of the final terms of the KRMB Operating
Agreement and the Roy Dan Employment Agreement, KRMB will transfer,
at least 5 days before confirmation, the lesser of the total amount
of funds needed to complete the Debtor's required payments due on
the Effective Date under this Plan or the Investment Cap Amount, to
the Escrow Agent.
Creditors who elect not to be paid with a lump sum payment on the
Effective Date will be paid from the Debtor's continued operations
and other receivables from operations.
A full-text copy of the Fourth Amended Plan dated April 18, 2022,
is available at https://bit.ly/36FCSDh from PacerMonitor.com at no
charge.
Counsel for Debtor:
Humberto Rivera, Esq.
Rivera Law Firm, PA
P.O. Box 211746
Royal Palm Beach, FL 33421
Telephone: (786) 529-6060
Facsimile: (786) 441-4373
Email: humberto@hriveralaw.com
About JEM Homes International
JEM Homes International, LLC, a Fort Pierce, Fla.-based
manufacturer of single-family homes, filed a petition for Chapter
11 protection (Bankr. S.D. Fla. Case No. 21-19086) on Sept. 20,
2021, listing up to $50,000 in assets and $1 million to $10 million
in liabilities. Roy Ronel Dan, managing member, signed the
petition. Judge Mindy A. Mora oversees the case. Rivera Law Firm,
PA, serves as the Debtor's legal counsel.
JILL ACQUISITION: Moody's Hikes CFR to B3, Outlook Remains Stable
-----------------------------------------------------------------
Moody's Investors Service upgraded Jill Acquisition LLC's (J.Jill)
corporate family rating to B3 from Caa1 and probability of default
rating to B3-PD from Caa1-PD. Concurrently, Moody's affirmed the
company's B3 senior secured term loan rating. The speculative grade
liquidity rating remains SGL-3 and the outlook is stable.
The CFR and PDR upgrades reflect the significant recovery in
J.Jill's operating performance, which has resulted in an improved
credit profile including deleveraging to 3.1x Moody's-adjusted
debt/EBITDA as of January 29, 2022. Moody's expects that the
operational discipline put in place by J.Jill over the past year
will mitigate sector pressures from inflation, supply chain
disruption, and a potential return to a more promotional
environment, and result in stable performance over the next 12
months.
The affirmation of the term loan rating reflects the Moody's
expectation for reduced subordinated claims relative to its secured
debt.
Moody's took the following rating actions for Jill Acquisition
LLC:
Corporate Family Rating, Upgraded to B3 from Caa1
Probability of Default Rating, Upgraded to B3-PD from Caa1-PD
Senior Secured Term Loan due 2024, Affirmed B3 (LGD3)
Outlook, Remains Stable
RATINGS RATIONALE
The B3 CFR is constrained by J.Jill's high business risk despite
the recovery in its performance. Although the company's earnings
exceeded 2019 levels in 2021 and consumer spending is still strong,
the apparel sector faces pressures from rising raw material, labor
and freight costs, and supply chain challenges. The rating also
reflects J.Jill's history of volatile operating performance, as
well as the fashion risk and intense competition inherent in the
sector. Further, the rating reflects governance considerations,
specifically the aggressive financial strategies associated with
majority ownership by private equity sponsor, Towerbrook Partners,
including the 2020 distressed exchange and previously, the special
dividend paid in 2019. The company must also refinance its debt,
which matures in 2024. In addition, as a retailer, J.Jill needs to
make ongoing investments in social and environmental factors,
including responsible sourcing, product and supply sustainability,
privacy and data protection.
J.Jill's rating is supported by the company's recognized brand and
loyal customer base. Moody's expects J.Jill to maintain much of the
margin gains in 2021 as inflationary pressures are mitigated by the
company's focus on tight inventory management, in-season markdowns
and cost controls, as well as its affluent customer demographic,
which should facilitate passing through cost increases. As a
result, Moody's expects J.Jill's credit metrics to remain near
current levels over the next 12-18 months, with Moody's-adjusted
debt/EBITDA in the low 3x range and EBITA/interest expense in the
mid-2x range. Liquidity is adequate, including projected positive
free cash flow, access to a relatively small but undrawn
asset-based revolver, and good covenant cushion, partly offset by
upcoming debt maturities.
The stable outlook reflects Moody's expectations for stable
operating performance and adequate liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if J.Jill refinances its debt
maturities in a timely and economical manner, while maintaining
stable revenues and earnings and generating solid positive free
cash flow. Quantitatively, the ratings could be upgraded is
debt/EBITDA is sustained below 3 times and EBITA/interest expense
above 2 times.
The ratings could be downgraded if refinancing risk increases, or
if earnings deteriorate or liquidity weakens for any reason.
Headquartered in Quincy, Massachusetts, Jill Acquisition LLC, a
subsidiary of J.Jill, Inc. is a US retailer of women's apparel,
footwear and accessories sold through its digital channel and over
250 retail stores. The company is publicly traded but
majority-owned by TowerBrook Capital Partners L.P. J.Jill generated
revenues of about $585 million for the fiscal year ended January
29, 2022.
The principal methodology used in these ratings was Retail
published in November 2021.
JOYFUL CARE: Unsecureds to Get $2K per Month for 60 Months
----------------------------------------------------------
Joyful Care Caregiving Services, Inc., submitted a Second Amended
Disclosure Statement describing Plan of Reorganization dated April
19, 2022.
The Debtor has been operating in the ordinary course since the
commencement of the case and has operated at a profit. Debtor is
still litigation the Estes Matter in the Bankruptcy Court and the
outcome of that matter will have an impact on the amounts available
to pay creditors in this case and the pro rate distributions to
unsecured creditors. Debtor will propose a restructuring plan to
pay off creditors through a payment plan approved by the Court.
The source of money earmarked to pay creditors and interest holders
in this case will come from Debtor's net operating income, which is
projected to be approximately $30,000 per month, for the term of
the Plan. Projected income is based anticipated increase in sales,
reductions in expenses such as IRS tax payments, which will be paid
in part through Debtor's plan and reduced marketing costs.
The amount of disbursement to creditors will be determined based on
the priorities under the Code and the pro rata share of payments
that creditors are entitled to under the Code. All creditors will
be paid in full in monthly payments over 5 years. A monthly amount
will be set aside for Estes on her disputed and unliquidated claim
until the claim is resolved.
Class 1 consists of Secured Claims totaling $483,561.08.
* Secured SBA loan of $150,000 with balance of $155,517 per
proof of claim #9.
* Secured loan with ODK Capital LLC with a balance of
$289,679.33 per proof of claim #6-1.
* Secured loan with BMW Financial Services with a balance of
$38,364.75 per proof of claim #2-1.
Debtor will make payments under it's agreement to secured creditors
SBA. Debtor will make monthly payments in the amount of $4,828 for
5 years to secured creditor ODK Capital LLC under the Plan to pay
off in full. Debtor will reject the BMW Financial Services loan and
not make any payments on this loan. The 2018 BMW X5 which secured
this loan is in the possession of disputed creditor Herminia Estes.
Estes has been requested to return this vehicle to BMW Financial
Services.
Class 2 consists of General Unsecured Claims. Total amount of
allowed and undisputed claim of unsecured creditor Herminia Estes.
The claim amount is $421,040. Total amount of payments to satisfy
claims shall be $115,428.76 for unsecured creditors, excluding
Estes claim. If Estes's claim is liquidated for $421,040, the total
payments to unsecured creditors, including claim will be
$536,468.76 from Debtor's net operating income.
Each installment for undisputed unsecured creditors will be $1,924
from Debtor's net operating income. Installment plan payments from
Debtor will be made every 30 days, after the effective date, for a
total of 60 months. Additionally, until the disputed Estes claim is
resolved, Debtor will set aside $7,017 per month in a separate
account as a reserve for the Estate claim.
The Debtor will continue to operate it's elder care services
business in the ordinary course.
A full-text copy of the Second Amended Disclosure Statement dated
April 19, 2022, is available at https://bit.ly/3KcfEmb from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
Joon M. Khang, Esq.
Judy L. Khang, Esq.
KHANG & KHANG LLP
4000 Barranca Parkway, Suite 250
Irvine, California 92604
Telephone: (949) 419-3834
Facsimile: (949) 385-5868
E-mail: joon@khanglaw.com
About Joyful Care Caregiving Services
Joyful Care Caregiving Services, Inc., in the business of providing
elder care services, sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. C.D. Cal. Case No. 21-11648) on June
30, 2021, disclosing total assets of up to $50,000 and total
liabilities of up to $500,000. Judge Erithe A. Smith presides over
the case. Khang & Khang, LLP, is the Debtor's legal counsel.
KB HOME: Egan-Jones Keeps BB- Senior Unsecured Ratings
------------------------------------------------------
Egan-Jones Ratings Company on March 31, 2022, maintained its 'BB-'
foreign currency and local currency senior unsecured ratings on
debt issued by KB Home.
Headquartered in Los Angeles, California, KB Home builds
single-family homes in the United States, primarily targeting
first-time and first move-up homebuyers.
KISSIMMEE CONDOS: Taps Shuker & Dorris as Legal Counsel
-------------------------------------------------------
Kissimmee Condos Partnership, LLC received approval from the U.S.
Bankruptcy Court for the Middle District of Florida to hire Shuker
& Dorris, PA to serve as legal counsel in its Chapter 11 case.
The firm's services include:
a. advising the Debtor as to its rights and duties in the
bankruptcy case;
b. preparing legal papers, including a disclosure statement
and a plan of reorganization; and
c. taking other necessary actions incident to the proper
preservation and administration of the Debtor's bankruptcy estate.
The hourly rates charged by the firm's attorneys and
paraprofessionals are as follows:
Partners $450 to $600
Associates $220 to $350
Paraprofessionals $105 to $160
Shuker & Dorris will also seek reimbursement for out-of-pocket
expenses.
The firm received an advance fee of $20,090 from the Debtor.
R. Scott Shuker, Esq., a partner at Shuker & Dorris, disclosed in a
court filing that his firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
Shuker & Dorris can be reached at:
R. Scott Shuker, Esq.
Shuker & Dorris, PA
121 S. Orange Avenue, Suite 1120
Orlando, FL 32801
Tel: (407) 337-2060
Email: rshuker@shukerdorris.com
About Kissimmee Condos Partnership
Kissimmee Condos Partnership, LLC is a Florida limited liability
company formed on Dec. 10, 2016, to hold and develop two parcels of
real property in Osceola County, Fla. Pre-petition, the company
developed and initiated the project, which includes the Soho at
Lakeside and Tribeca at Lakeside, which are both residential
townhome developments to be built over several phases.
Kissimmee Condos filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-00994) on March
21, 2022, listing as much as $10 million in both assets and
liabilities. Robert Altman serves as Subchapter V trustee.
Judge Grace E. Robson oversees the case.
R. Scott Shuker, Esq., at Shuker and Dorris, PA is the Debtor's
legal counsel.
KURNCZ FARMS: Has Deal on Cash Collateral Access
------------------------------------------------
Kurncz Farms, Inc., PNL Devine, LLC, the Internal Revenue Service,
the Official Committee of Unsecured Creditors appointed in the
case, and the U.S. Trustee ask the U.S. Bankruptcy Court for the
Western District of Michigan for entry of an amended cash
collateral order.
The Amended Final Cash Collateral Order clarifies the deadlines for
the Debtor to provide to PNL, the IRS, the Committee, and the U.S.
Trustee the monthly budgets and budgets-to-actual. The Debtor will
provide a monthly budget to the Notice Parties by the first of each
month. Further, the Debtor will provide the budget-to-actual for
the preceding month by the 21st of the subsequent month.
The Debtor and PNL have agreed to increase the monthly payments to
PNL to $80,000, with $40,000 to be paid to PNL from each of the
Debtor's milk checks.
The Debtor and PNL have agreed to plan treatment. This plan
treatment is not binding upon the U.S. Trustee, the Committee, the
IRS, or any other party-in-interest, and those parties reserve
their rights and remedies provided by law to object to the proposed
plan treatment.
A summary of the proposed plan treatment is as follows:
a. Monthly Payments of $80,000 to be applied as follows:
i. $6,314.78 per month will be applied to the Cattle
Lease until the obligation is satisfied;
ii. $15,728.75 per month will be applied to the New
Inputs Loan until the loan is paid in full;
iii. 6.5% interest on the principal balance of
$8,725,566;
iv. Late, loan, legal and all other fees until paid
in full (and as being accrued); and then
v. Principal on the Note.
b. Plan term is five years. All indebtedness due to PNL must
be paid by the end of the plan.
c. If there is a material default under the plan, PNL will
send to the Debtor and the Debtor's counsel notice of the default,
and after a 5-business day cure period, if the default is not
cured, then PNL may file a motion for relief from stay, along with
a motion for expedited hearing, seeking termination of the
automatic stay. Debtor will not challenge or contest the motion for
expedited hearing (Debtor reserves all rights to object to the
motion for relief from stay).
d. The Debtor will agree to waive preference claims in the
Chapter 11 case. This waiver is not binding on any Chapter 7
trustee if the case is later converted.
e. PNL will be granted replacement liens and security
interests with the same priority, validity, and perfection as prior
to the filing of the bankruptcy petition. Notwithstanding the
foregoing, it is anticipated that each year, the Debtor will need a
new input loan for crops. If PNL is not the lender for the new
input loans, then PNL agrees and understands that the new input
loan lender will receive a first priority security interest in the
Debtor's crops for that year.
The Carve-Out for professional fees for the Debtor is increased to
$20,000 per month.
The Debtor requires a new input loan for the 2022 crop season. PNL
has agreed to fund the 2022 Input Loan on these terms:
a. Amount. The loan amount will not exceed $600,000.
b. Interest. Interest will accrue at the rate of 9.5% per
annum.
c. Repayment. The term of the 2022 Input Loan begins on the
date of the first advance and is payable in full on or before March
31, 2023. Interest only payments must be paid each month and will
be due on the last day of each month through September 30, 2022.
d. Security Interest. The Debtor will grant PNL a first
priority security interest in the 2022 crops and proceeds from
same.
e. Default. If the Debtor defaults on the 2022 Input Loan,
then the default will be deemed a default on the use of cash
collateral, and PNL will have the remedies provided for in the
Amended Final Cash Collateral Order. In addition, in the event the
Debtor's authority to use cash collateral is terminated, such an
event will be a default under the 2022 Input Loan.
f. PNL and the Debtor will document the above terms in a loan
agreement to submit to the Court for review and approval.
A copy of the stipulation is available at https://bit.ly/3xIFlrB
from PacerMonitor.com.
About Kurncz Farms, Inc.
Kurncz Farms, Inc. is part of the cattle ranching and farming
industry. The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Mich. Case No. 21-02612) on November
30, 2021. In the petition signed by Peter J. Kurncz, president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge John T. Gregg oversees the case.
Susan M. Cook, Esq., at Warner Norcross and Judd, LLC is the
Debtor's counsel.
LAKEVIEW VILLAGE: Fitch Affirms BB+ Rating on 2017A/2018A Bonds
---------------------------------------------------------------
Fitch Ratings has affirmed the 'BB+' rating assigned to the
following City of Lenexa, KS Health Care Facility revenue bonds
issued on behalf of Lakeview Village, Inc. (Lakeview):
-- $16.3 million series 2017A;
-- $49 million series 2018A.
Fitch has also affirmed Lakeview's Issuer Default Rating (IDR) at
'BB+'.
The Rating Outlook is Stable.
SECURITY
The bonds are secured by a pledge of unrestricted receivables, a
leasehold interest on the existing facility and a debt service
reserve fund (DSRF).
ANALYTICAL CONCLUSION
The 'BB+' rating and Stable Outlook reflect Fitch's expectation
that Lakeview will continue to demonstrate balance sheet and
profitability metrics that are consistent with historical
performance. Similar to sector trends, Lakeview has experienced
staffing challenges resulting in community wide wage adjustments
and reduction of short-term rehabilitation services, which
pressured operating performance in 2021 (FYE Dec. 31). However,
Fitch expects Lakeview will show improvement towards its historical
averages, as management reports staffing pressures are beginning to
ease.
Lakeview's independent living unit (ILU) occupancy dipped in 2021,
which further pressured its operating results. However, Fitch
expects Lakeview's ILU occupancy to improve, as executed lifecare
contracts are exceeding budgeted expectations, and management is
reporting favorable market response to its repositioning of
outdated, smaller ILUs into larger, more modern units.
KEY RATING DRIVERS
Revenue Defensibility: 'bb'
Demand Remains Consistent Despite Competition
Lakeview's weak revenue defensibility assessment reflects ILU
occupancy consistently in the mid to low 80% range. Occupancy
dropped to 82% in 2021 from 84% in 2020, due to higher than average
attrition. However, Fitch expects occupancy will show improvement
towards historical averages, as executed lifecare contracts and
resultant move-ins are exceeding budgeted expectations.
AL occupancy also decreased to 78% compared to a prior three-year
average of around 94% representing roughly a decrease of two
unoccupied beds due to staffing pressures. SNF occupancy was about
78%, which is in line with the prior year.
Fitch believes that Lakeview will continue to improve marketing and
sales of its ILUs as they continue to reposition units. Lakeview
has strong relationships with a neighboring acute care provider,
which Fitch expects will support recovery in AL and SNF census.
This community is located in a highly competitive area with new
inventory coming on line throughout Johnson County. Fitch expects
that IL occupancy should remain at its current level with
incremental increases possible as management continues to
reposition older less desirable 4-plex cottage units to more
marketable single family and duplex structures.
Operating Risk: 'bbb'
Solid Cost Management and Adequate Capital Spending
Lakeview a type-A community is a solid operator for its rating
level. The community continues to post core operating results that
are consistent with a 'bbb' assessment of its operating risk.
Lakeview's five-year averages for operating ratio, net operating
margin (NOM) and NOM - adjusted are 99.9%, 6.8% and 100.7%,
respectively.
Lakeview's operating ratio deteriorated to 104.6% in 2021, due
primarily to staffing challenges and declines in ILU occupancy.
However, Fitch generally expects Lakeview's operating performance
will recover over the next year, as their staffing challenges are
beginning to ease and ILU occupancy is expected to improve.
In fiscal 2021, (FYE Dec 2021), Lakeview exceeded budget by closing
33 Lifecare contracts, resulting in $8.6 million in fees compared
to the 28 contracts and 6.7 million in collections that were
forecasted. However, in 2021, they experienced a vacate rate that
was higher than actuarial projections, with a lower than expected
turnover rate.
Lakeview's average age of plant is elevated at around 16.2. To
address this, management has focused its capex plans on renovating
and repositioning the community to meet rising market demands for
larger and more modern units.
Lakeview's capital-related metrics indicate that its long-term
liabilities are supportable based on its consistent operating
performance. Its five-year average for revenue-only MADS, MADS as a
percentage of revenue, and debt-to-net available are 0.8x, 12.3%,
and 6.3x.
Financial Profile: 'bb'
Steady Margins Drive Incremental Cash Growth
Lakeview's unrestricted cash and investments totaled about $38.6
million as of fiscal 2021, representing 66.4% cash-to-adjusted
debt, which remains at or above 52% during the period of economic
and operational volatility assumed in Fitch's stress case scenario.
Lakeview's five-year average MADS is solid at 1.9x, also displaying
stability during Fitch's stress case. As of FYE 2021, Lakeview had
333 days cash on hand (DCOH), which is neutral to Fitch's
assessment of its financial profile.
Asymmetric Additional Risk Considerations
There are no asymmetric risk factors affecting this rating
determination. All of Lakeview's outstanding debt is fixed rate and
fully-amortizing.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Improved ILU occupancy that is consistently around 90%;
-- Net operating margin adjusted (NOMA) that stays around 28%-
30%, leading to commensurate growth in liquidity.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- ILU occupancy to decline to sustained levels below 80%;
-- Sustained weakness in core operating metrics, resulting in net
operating margin (NOM) and operating ratio maintained at
levels of about 12%-15% and 103%-105%, respectively.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Sovereigns, Public Finance
and Infrastructure 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 three 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.
CREDIT PROFILE
Lakeview is located on a 96-acre campus in Lenexa, Kansas. The
community consists of 533 ILUs, 26 ALUs, a 120-bed SNF and 38
short-term rehab beds. All occupancy statistics are calculated on a
marketable unit basis. Lakeview has three affiliated entities
outside the obligated group (OG), including a foundation and two
independent living HUD properties. Fitch uses OG financials for its
analysis and all figures cited in this press release. Lakeview had
approximately $45.6 million in total revenues in 2021.
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.
LAMAR ADVERTISING: Egan-Jones Maintains BB- Sr. Unsecured Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company on March 31, 2022, maintained its 'BB-'
foreign currency and local currency senior unsecured ratings on
debt issued by Lamar Advertising Company.
Headquartered in Baton Rouge, Louisiana, Lamar Advertising Company
owns and operates outdoor advertising structures in the United
States.
LANAI LAND: Seeks Approval to Hire Tran Singh as Legal Counsel
--------------------------------------------------------------
Lanai Land Corporation seeks approval from the U.S. Bankruptcy
Court for the Southern District of Texas to hire Tran Singh, LLP to
serve as legal counsel in its Chapter 11 case.
The firm's services include:
(a) analyzing the financial situation and rendering legal
assistance to the Debtor;
(b) advising the Debtor with respect to its rights, duties and
powers in the case;
(c) representing the Debtor at all hearings and other
proceedings;
(d) preparing and filing schedules of assets and liabilities,
statements of affairs, motions and other legal papers;
(e) representing the Debtor at any meeting of creditors;
(f) representing the Debtor in all proceedings before the
bankruptcy court and in any other judicial or administrative
proceeding where its rights may be litigated or otherwise
affected;
(g) preparing and filing a disclosure statement, if required,
and Subchapter V plan of reorganization;
(h) assisting the Debtor in analyzing the claims of creditors
and in negotiating with such creditors; and
(i) assisting the Debtor in any matters relating to or arising
out of the case.
The firm's hourly rates are as follows:
Susan Tran Adams, Esq. $450 per hour
Brendon Dane Singh, Esq. $500 per hour
Mayur M. Patel, Esq. $400 per hour
The Debtor paid a retainer fee of $16,000 to the firm.
Brendon Dane Singh, Esq., the firm's attorney who will be providing
the services, disclosed in a court filing that he is a
"disinterested person" as the term is defined in Section 101(14) of
the Bankruptcy Code.
The firm can be reached at:
Susan Tran, Esq.
Brendon Dane Singh, Esq.
Tran Singh LLP
2502 La Branch Street
Houston, TX 77004
Tel: (832) 975-7300
Fax: (832) 975-7301
Email: stran@ts-llp.com
bsingh@ts-llp.com
About Lanai Land Corporation
Lanai Land Corporation, a utility services provider in Corpus
Christi, Texas, filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. S.D. Texas Case No. 22-20057 on March
8, 2022, listing as much as $10 million in both assets and
liabilities. Chris Quinn serves as Subchapter V trustee.
Judge David R. Jones oversees the case.
Susan Tran Adams, Esq., at Tran Singh, LLP serves as the Debtor's
legal counsel.
LEAR CAPITAL: Customers Want Official Committee
-----------------------------------------------
Rick Archer of Law360 reports that a group of customers claiming
they were duped into bad precious metal investments by a California
telemarketing firm are asking a Delaware bankruptcy judge to
appoint a committee to represent them and what they claim may be
thousands of other customers.
The customers of Lear Capital Inc., which filed for Chapter 11 in
March, argued in a motion filed Wednesday, April 20, 2022, that a
committee is needed to represent customers with legal claims
against the company, and that it needs to be in place before the
case's claims filing deadline closes at the end of April 2022.
About Lear Capital
Lear Capital Inc. is a silver and gold coin dealer based in Los
Angeles, Calif.
Lear Capital filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Del. Case No. 22-10165) on March 2,
2022, to weather possible future legal claims associated with its
sales practices as well as customer disclosures. Jami B. Nimeroff
serves as Subchapter V trustee.
As of Feb. 28, 2022, Lear Capital had assets of $34,449,619 against
liabilities of $22,355,066.
Judge Brendan Linehan Shannon oversees the case.
The Debtor tapped Shulman Bastian Friedman & Bui, LLP as general
bankruptcy counsel; Morris James, LLP as local counsel; Mitchell
Silberberg & Knupp, LLP as special litigation and corporate
counsel; Paladin Management Group as financial advisor; and Baker
Tilly US, LLP as accountant. BMC Group, Inc. is the claims,
noticing and administrative agent.
LINDSAY YORK: Unsecureds Will Get 26% to 32% of Claims in Plan
--------------------------------------------------------------
Lindsay York Fantaci, M.D., LLC filed with the U.S. Bankruptcy
Court for the Eastern District of Louisiana a Second Amended Plan
of Reorganization.
The Debtor is a single member limited liability corporation. The
member, Lindsay York Fantaci, MD, is a medical doctor, and the
business of the Debtor is the operation of a pediatrician office.
The Debtor filed for chapter 11 bankruptcy protection to address
litigation issues, to address outstanding tax issues, and to
provide a period of time to reorganize the Debtor's financial
operations.
The Debtor filed for bankruptcy protection to provide breathing
room for the Debtor to reorganize its financial operations. The
Debtor's practice has experienced a temporary reduction in patients
due to the Covid-19 pandemic. Most recently, the Debtor experienced
a loss of vaccines and had to stop seeing patients due to lack of
electricity to the office due to Hurricane Ida in August 2021.
This Plan of Reorganization proposes to pay creditors of the Debtor
from monthly net income.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of the Plan has valued
at approximately 26% to 32% based on the estimates of the allowed
claim amount. This Plan also provides for the payment of
administrative and priority claims as unclassified claims.
The Debtor anticipates that Plan payments will commence, December
30, 2022, and continue for three years, eight months making the
final Plan payment is expected to be paid in September 2026.
Class 1 consists of the Secured Claim of U.S. Small Business
Administration. Class 1 is unimpaired by this Plan. The Debtor will
pay the claim amount pursuant to the agreement at the contracted
interest rate for the SBA loan with payments contracted to commence
in May 2022. The principal amount of the loan is $500,000.00 and
the yearly payment is $30,204.00 or $2,517.00 per month.
Class 2 consists of All non-priority unsecured claims. To the
extent that there are available funds on December 31 of each year
during the Plan term, after the payment of ordinary business
expenses, including but not limited to, operations and Plan
payments ("Excess Funds"), all Excess Funds up to $75,000.00 will
be tendered to the Chapter 7 Trustee, until such time as this case
is converted to one under Chapter 7 or all creditors have been paid
in accordance with the Plan. Any Excess Funds that exceeds
$75,000.00 will be distributed to allowed Class 2 creditors, not to
exceed a 100% payment. The allowed unsecured claims total
$560,699.21 to $461,346.95.
Class 3 which consists solely of Lindsay York Fantaci, MD, and will
not be impaired by this Plan, which interest is subject to the
rights of Mr. Fantaci. The Class 3 member will continue to own 100%
of the reorganized Debtor.
This Plan will be funded by the ongoing operations of the Debtor.
The Debtor anticipates that Lindsay York Fantaci, MD who is an
insider of the Debtor, will continue in her position as sole member
of the Debtor. The compensation of $1,726.75 gross weekly will
continue for the remainder of 2022 and will increase to $2,200.00
gross weekly for 2023 forward, only if the Debtor has sufficient
cash flow for the increase. The Debtor will continue filing tax
returns as a pass-through entity.
To the extent there are any Excess Funds, any Excess Funds up to
$75,000 will be paid to the chapter 7 Trustee in In re Lindsay York
Fantaci, MD, case number 21-11127 ("Individual Case"). Any Excess
Funds in excess of $75,000.00 will be added as an additional
distribution to allowed Class 2 creditors, not to exceed a 100%
payment. If holders of allowed Class 2 claims are paid in full due
to excess distributions before the 3-year Plan term, the Debtor
will file a notice of payment in full with the Bankruptcy Court.
A full-text copy of the Second Amended Plan dated April 18, 2022,
is available at https://bit.ly/3rNNxTI from PacerMonitor.com at no
charge.
Counsel for the Debtor:
Greta M. Brouphy, Esq.
Michael E. Landis
Heller, Draper & Horn, LLC
215 N. Columbia Street
Covington, LA 70433
Phone: (504) 299-3300
Email: gbrouphy@hellerdraper.com
E-mail: mlandis@hellerdraper.com
About Lindsay York Fantaci MD
Lindsay York Fantaci, M.D., LLC, a Marrero, La.-based medical group
practice that specializes in pediatrics, filed its voluntary
petition for Chapter 11 protection (Bankr. E.D. La. Case No.
21-11186) on Sept. 30, 2021, listing up to $500,000 in assets and
up to $10 million in liabilities. Judge Meredith S. Grabill
oversees the case. Greta M. Brouphy, Esq., at Heller, Draper &
Horn, LLC, is the Debtor's legal counsel.
M 1 INDUSTRIES: Seeks to Hire Prager Metis as Accountant
--------------------------------------------------------
M 1 Industries Inc. seeks approval from the U.S. Bankruptcy Court
for the Eastern District of New York to hire Prager Metis CPAs, LLC
as its accountant.
The firm's services include:
a. assisting in the preparation of monthly operating reports:
b. preparing tax returns; and
c. furnishing other accounting services:
The hourly rates charged by the firm for its services are as
follows:
Partner/Principal $430 - $530
Manager $330
Staff Accountant $275
Corey Neubauer, CPA, member of Prager Metis, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Corey H. Neubauer, CPA
Prager Metis CPAs, LLC
401 Hackensack Avenue 4th Floor
Hackensack, NJ 07601
Phone: 201-342-7753
About M 1 Industries
M 1 Industries Inc. filed a petition under Chapter 11, Subchapter V
of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-70500) on March
22, 2022, listing up to $1 million in assets and up to $500,000 in
liabilities. Ronald J. Friedman, Esq., serves as Subchapter V
trustee.
Judge Louis A. Scarcella presides over the case.
Andrew M. Thaler, Esq., at Thaler Law Firm, PLLC and Prager Metis
CPAs, LLC serve as the Debtor's legal counsel and accountant,
respectively.
MACOM TECHNOLOGY: Moody's Ups CFR to B1 & Alters Outlook to Stable
------------------------------------------------------------------
Moody's Investors Service upgraded the ratings of MACOM Technology
Solutions Holdings, Inc, including the Corporate Family Rating to
B1 from B2, the Probability of Default Rating to B1-PD from B2-PD,
and the Senior Secured Term Loan (Term Loan) to Ba1 from Ba2. The
Speculative Grade Liquidity (SGL) rating is unchanged at SGL-2. The
outlook is stable.
The upgrade to the CFR reflects MACOM's improved operating
performance over the past year, with healthy revenue growth
supporting the increase in the EBITDA margin (Moody's adjusted) to
the upper 20s percent level. Moody's expect this solid operating
performance to be sustained. The high EBITDA margin, modest capital
intensity, and the reduced cash interest expense following last
March's issuance of the 0.25% Convertible Notes due 2026
(Convertible Notes) to fund repayments of the Senior Secured Term
Loan due 2024 (Term Loan), MACOM is generating consistent free cash
flow (FCF). MACOM's improved operating profile reflects the
strengthening end market demand over the past year and the positive
impact of MACOM's expense discipline following the operational
restructuring during the second half of 2019.
Upgrades:
Issuer: MACOM Technology Solutions Holdings, Inc.
Corporate Family Rating, Upgraded to B1 from B2
Probability of Default Rating, Upgraded to B1-PD from B2-PD
Senior Secured Bank Credit Facility, Upgraded to Ba1 (LGD2) from
Ba2 (LGD2)
Outlook Actions:
Issuer: MACOM Technology Solutions Holdings, Inc.
Outlook, Changed To Stable From Positive
RATINGS RATIONALE
The B1 CFR reflects MACOM's small scale, as MACOM competes against
a number of semiconductor firms that have much greater financial
resources and product breadth, such as Broadcom Inc. Moody's
believes this small scale places MACOM at a competitive
disadvantage and exposes the company to the risk of product
displacement. The CFR also reflects the high volatility of demand
in most of the end markets it serves. About 55% of MACOM's revenues
are generated from the volatile Telecom and Data Center end
markets. These end markets tend to experience significant surges
and pauses in demand driven by the capital expenditures of the
ultimate end market customers, which are comprised of a limited
number of very large telecommunications carriers and hyperscale
data center owners. Moreover, with about 35% of revenues generated
by sales through distributors, and most sales done through purchase
orders rather than under long term contracts, MACOM has limited
visibility into end market demand.
Although leverage is moderate at 3.6x debt to EBITDA (12 months
ended December 31, 2021, Moody's adjusted), cash interest expense
is modest, as the Convertible Notes (unrated) comprise the majority
of the debt. The low cash interest burden, strong EBITDA margins in
the upper 20 percent level (Moody's adjusted), and the low capital
intensity contribute to the consistent free cash flow (FCF)
generation. Over the next 12 to 18 months, Moody's expects that
revenues will grow in the mid single digits percent, driven by
continued healthy end market demand in the Telecom and Industrial &
Defense (I&D) end markets, with revenue growth in the mid to upper
single digits percent, and modest growth in the Data Center end
market. The increasing revenues and cost discipline should drive
further growth in EBITDA such that Moody's expects that financial
leverage will steadily improve, with debt to EBITDA (Moody's
adjusted) declining toward 3x over the next 12 to 18 months. The
I&D end market, which comprises about 46% of revenues, benefits
from generally longer product cycles, providing a base of more
stable revenues relative to MACOM's other two end markets.
MACOM's ESG Credit Impact Score is moderately negative (CIS-3). The
company has moderately negative environmental and governance risks
with low social risks in-line with the broader semiconductor
sector. MACOM's governance poses moderately negative risks. The
company pursues a prudent financial policy with low tolerance for
leverage and adheres to policies and standards of a listed company,
demonstrates a strong management track record, which partially
mitigate the concentrated voting rights of the Ocampo family, which
beneficially owned 26.6% of MACOM's common stock as of October 1,
2021.
The stable outlook reflects Moody's expectation that revenues will
grow in the mid single digits percent and that the EBITDA margin
(Moody's adjusted) will be maintained in the upper 20 percent
range. This will contribute to deleveraging, with debt to EBITDA
(Moody's adjusted) improving toward 3x over the next 12 to 18
months. With the increased EBITDA and the low cash interest burden,
Moody's expects that FCF to debt (Moody's adjusted) will be
maintained above the 20 percent level over the period.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if MACOM:
Significantly increases revenue scale and diversifies end market
demand to reduce the overall impact of segment revenue volatility
Sustains the EBITDA margin (Moody's adjusted) of above 30%
Maintains FCF to debt (Moody's adjusted) above 20%
Maintains a conservative financial policy
The ratings could be downgraded if:
Material revenue decline within one or more segmentsThe EBITDA
margin (Moody's adjusted) declines toward the low 20% level
FCF to debt (Moody's adjusted) declines toward 10%.
The Ba1 rating of the Term Loan reflects its seniority in the
capital structure, the collateral package, and the large cushion of
unsecured liabilities, including the unrated Convertible Notes.
Upon a future refinancing, where the first lien senior secured
would comprise a larger proportion of the debt, it is possible that
the Ba1 Term Loan rating would converge to the B1 CFR.
The Speculative Grade Liquidity (SGL) rating of SGL-2 reflects
MACOM's good liquidity profile. Moody's expects that MACOM will
keep at least $200 million of cash and short term investments and
will generate FCF of at least $130 million over the next year.
There are no financial maintenance covenants governing the Term
Loan.
MACOM Technology Solutions Holdings, Inc.(MACOM), based in Lowell,
Massachusetts, produces high performance analog communication
semiconductor products across the radiofrequency spectrum. These
include integrated circuits and discrete semiconductors used in
data center, telecommunications infrastructure, industrial, and
defense market applications, such as optical networking, telecom
backhaul, and RADAR. MACOM utilizes a fab-lite manufacturing model,
outsourcing a large portion of its semiconductor chip
manufacturing, which limits capital expenditures.
The principal methodology used in these ratings was Semiconductors
published in September 2021.
MARVIN KELLER: Case Summary & 16 Unsecured Creditors
----------------------------------------------------
Debtor: Marvin Keller Trucking, Inc.
1500 West Pointe Way
Sullivan, IL 61951
Business Description: The Debtor operates a nationwide commercial
trucking operation, with its headquarters
located in Sullivan, Illinois.
Chapter 11 Petition Date: April 22, 2022
Court: United States Bankruptcy Court
Central District of Illinois
Case No.: 22-90165
Judge: Hon. Mary P. Gorman
Debtor's Counsel: Sumner A. Bourne, Esq.
RAFOOL & BOURNE, P.C.
401 Main Street, Suite 1130
Peoria, IL 61602
Tel: (309) 673-5535
Fax: (309) 673-5537
Email: notices@rafoolbourne.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Joseph E. Keller, president and CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 16 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/XV4GKNI/Marvin_Keller_Trucking_Inc__ilcbke-22-90165__0001.0.pdf?mcid=tGE4TAMA
MAUSER PACKAGING: Moody's Hikes CFR to B3, Outlook Remains Stable
-----------------------------------------------------------------
Moody's Investors Service upgraded Mauser Packaging Solutions
Holding Company's corporate family rating to B3 from Caa1 and its
Probability of Default Rating to B3-PD from Caa1-PD. Moody's also
upgraded the ratings on the company's senior secured term loan and
senior secured notes due 2024 to B2 from B3 and its senior
unsecured notes due 2025 to Caa2 from Caa3. The rating outlook is
stable.
"The upgrade considers recovery in Mauser's profit, reflecting
progress in cost pass-throughs and volume recovery in its key
business segments," said Motoki Yanase, VP - Senior Credit Officer
at Moody's.
"As a result, leverage improved to 7.6x for 2021 from 10.1x in
2020, which we expect to improve below 7.0x within the next 12-18
months," added Yanase.
Moody's took the following actions:
Upgrades:
Issuer: Mauser Packaging Solutions Holding Company
Corporate Family Rating, Upgraded to B3 from Caa1
Probability of Default Rating, Upgraded to B3-PD from Caa1-PD
Senior Secured Bank Credit Facility, Upgraded to B2 (LGD3) from B3
(LGD3)
Senior Secured Regular Bond/Debenture, Upgraded to B2 (LGD3) from
B3 (LGD3)
Senior Unsecured Regular Bond/Debenture , Upgraded to Caa2 (LGD5)
from Caa3 (LGD5)
Outlook Actions:
Issuer: Mauser Packaging Solutions Holding Company
Outlook, Remains Stable
RATINGS RATIONALE
Mauser's sales increased by close to 30% to $4.7 billion in 2021,
supported by cost pass-throughs and higher volume in its North
American Large Packaging and International Packaging segments. A
corresponding increase in EBITDA supported leverage improvement in
2021. Moody's expects Mauser will manage to increase its sales and
profit for the next 12-18 months, as industrial customers' demand
gradually increase, and achieve leverage below 7.0x in 2022, under
the base case scenario. Negative impact from Russia-Ukraine
military conflict may slow profit improvement and deleveraging, but
Moody's still expects Mauser will be able to achieve below 7.0x
leverage around the end of 2023 after incorporating some downside.
Ongoing efforts to improve operating efficiencies and cut costs
will also help secure profit, partly offsetting higher labor,
freight and energy costs.
Mauser's CFR reflects the company's credit strengths, including its
competitive position and leading share in the relatively
consolidated US paints and coatings market. The company has
long-standing relationships with customers, including many
blue-chip names, which provides some revenue stability. Mauser also
caters to more stable end markets, including food and consumer
products, which accounted for around 16% of sales in 2021. Mauser
has greater scale and breadth of product line than many
competitors, and the high shipping costs for many products the
company sells create a barrier against imports.
These credit strengths are counterbalanced with the company's
credit weakness, including high leverage and most of its sales
originating from customers in industrial end markets (chemicals,
paints and coatings, and petrochemicals), which tend to have more
cyclical demand relative to that of food and household consumer
goods. The company has a leading position in paint cans and
plastic/steel pails, but it also operates in more competitive and
fragmented market for bulk shipping packaging products.
Moody's expects Mauser to have good liquidity over the next 12-18
months, supported by its cash on hand as of December 2021, $204
million availability asset-based revolver expiring in September
2024 and projected FCF generation. The asset-based revolver is
subject to borrowing base limitations and includes a $40 million
limit for letters of credit.
As an additional measures to secure short-term liquidity, Mauser
also maintains factoring facility with a financial institution,
which allows the company to sell qualifying trade receivable
invoices and obtain short-term financing. During 2021, cash
receipts on sold trade receivable amounted to about $1.1 billion.
The factoring facility expires in November 2023 unless extended.
The only financial covenant is a springing covenant with the ABL
revolver of 1.0x fixed-charge coverage ratio if availability is
less than the greater of (a) 10% of the lesser of the commitment
and the borrowing base and (b) $20 million. Moody's expects the
projected buffer under the financial covenant to remain sufficient
over the next 12 months.
Amortization on the term loan is 1.0% annually. Mauser's nearest
long-term debt maturity is the senior secured term loan that
matures on April 3, 2024. Mauser's non-US subsidiaries are excluded
from the guarantor group, which could provide some alternative
liquidity, if monetized. The company generated about 30% of revenue
from non-US operations in 2021.
The senior secured term loan and senior secured notes due April
2024 at Mauser Packaging Solutions Holding Company are rated B2,
one notch above the B3 CFR. The one-notch difference reflects these
facilities' senior position in the capital structure relative to
the unsecured notes, and collateral and guarantees that represent
the majority of the group's assets and EBITDA.
The term loan and secured notes are pari passu and guaranteed by
Mauser Packaging Solutions Intermediate Company, Inc., the direct
parent of the issuer, and each of the issuer's existing and future
direct and indirect wholly owned domestic subsidiaries are subject
to certain exceptions.
The term loan and secured notes are secured by first priority
security interest on substantially all of fixed assets of Mauser
Packaging Solutions Holding Company, Inc. and its subsidiaries, and
a second priority lien on all current assets of these entities,
which are securing the $275 million ABL revolving credit facility
(unrated).
The term loan has no financial covenants but there is an excess
cash flow sweep. The secured notes do not have financial covenant
or excess cash flow sweep. In 2021, the guarantors accounted for
about 70% of consolidated revenue.
The Caa2 rating on the senior unsecured notes due April 2025,
issued by Mauser Packaging Solutions Holding Company, reflects
subordination to the substantial amount of secured debt. The notes
are fully and unconditionally guaranteed on a senior unsecured
basis by the same domestic guarantors as the secured facilities.
The stable rating outlook reflects Moody's expectation that Mauser
will continue to improve high leverage and restore positive free
cash flow over the next 12-18 months, supported by its ongoing
effort to increase operating efficiencies and sales and recovering
demand from industrial customers.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade the ratings if Mauser sustainably improves
its credit metrics and liquidity with an improvement in the
cyclical end markets the company serves and without debt-financed
acquisitions or dividends. Specifically, the ratings could be
upgraded if debt/EBITDA is sustained below 6.0x, EBITDA/interest
expense is above 3.0x and FCF/debt is above 4% through various
phase of the economic cycle.
Moody's could downgrade the ratings if the company fails to improve
its credit metrics and FCF. Additionally, any material decline in
the end markets Mauser serves could drive a rating downgrade.
Specifically, the ratings could be downgraded if debt/EBITDA
increases above 7.0x, EBITDA/interest expense falls below 2.0x or
FCF turns negative or liquidity deteriorates.
Headquartered in Oak Brook, Illinois, Mauser Packaging Solutions
Intermediate Company, Inc. is a manufacturer and distributer of
rigid metal, plastic and fiber containers primarily to
manufacturers of industrial and consumer products for use as
packaging. The company is the reporting entity for the group and
the parent of Mauser Packaging Solutions Holding Company, the
borrower/issuer of the group's debt. The company generated about
$4.7 billion in revenue in 2021. The company has been owned by
Stone Canyon Holding Industries Holding, Inc. since 2016 and does
not publicly disclose financial information.
The principal methodology used in these ratings was Packaging
Manufacturers: Metal, Glass and Plastic Containers published in
December 2021.
MEDLINE BORROWER: Fitch Alters Outlook on 'B+' LT IDR to Negative
-----------------------------------------------------------------
Fitch Ratings has affirmed Medline Borrower, LP's (Medline)
Long-Term Issuer Default Rating (IDR) at 'B+'. The Rating Outlook
is revised to Negative from Stable.
The Outlook revision is primarily based on Fitch's expectation that
Medline's EBITDA growth will be slower than anticipated, and,
therefore, the company's leverage may remain significantly above
Fitch's prior expectations, which were set at gross leverage (gross
debt/EBITDA) of 6x or lower by YE 2023. In addition, leverage may
remain higher for a longer period of time if the company elects to
use FCF to make payments in 2022 and 2023 under a Management
Performance Unit (MPU) Plan in lieu of reducing debt. Fitch could
stabilize the Outlook and affirm the ratings if inflationary
pressures subside or if Medline is able to mitigate such
pressures.
The ratings applied to approximately $17 billion of debt as of Dec.
31, 2021.
Fitch has also assigned a 'B+' IDR to Mozart Holdings, LP with a
Negative Outlook. Mozart Holdings, LP is the parent of Medline
Borrower, LP and the reporting entity of the consolidated financial
statements. The IDRs are rated on a consolidated basis as discussed
in Fitch's Parent-Subsidiary Linkage Criteria using the weak
parent/strong subsidiary approach, open access and control factors
based on the entities operating as a single enterprise with strong
legal and operational ties.
KEY RATING DRIVERS
Leading Market Position for Medical/Surgical Products: Medline is a
market leader in the manufacturing and distribution of
medical/surgical products in the U.S. The company's vertical
integration of manufacturing and distribution capabilities and
global sourcing relationships helps to differentiate it from
leading competitors, such as Cardinal Health, Inc. and Owens &
Minor, Inc. Medline's profitability is enhanced by its ability to
maintain and grow relationships across a significant number of the
largest integrated delivery networks across the U.S. with Medline
branded products.
Consistently Solid Cash Flow: A combination of strong persistency
of existing customers and the ability to effectively penetrate both
the acute care and post-acute care health care market with private
label products produces a high level of profitability and cash
flow. Investments in new and existing capacity are expected to
remain relatively stable over the forecast horizon.
Leverage Profile is High: Pro forma for the acquisition of Medline
by Blackstone, Carlyle and Hellman & Friedman (the Sponsors), gross
leverage (gross debt/EBITDA) is above 7.0x and FCF/Debt is below
5%. Gross debt is expected to be reduced over the medium to long
term, however, the amount and timing of debt reduction will depend
largely on whether Medline uses FCF to reduce debt or to make
payments under an MPU Plan or to make acquisitions. Also, gross
leverage will depend heavily on revenue and EBITDA growth.
Inflationary headwinds are expected to persist over the medium
term, however, Medline is believed to have broad pricing power to
offset those headwinds. Implementation of price increases is
expected to generally lag rising costs.
Fitch's calculation of gross leverage includes an amount of
mortgage debt secured principally by Medline's manufacturing and
distribution facilities. Such debt is treated as a having a higher
priority of claim than all other senior secured and senior
unsecured debt.
Governance and Financial Policy: Following the acquisition of
Medline, the Mills family remains the single largest shareholder in
the company. However, the Mills family no longer controls the
company and will need to work with the Sponsors to undertaking
significant actions, such as entering into material M&A
transactions, issuance of debt or equity, or paying of material
dividends. Fitch believes two critical assumptions underpinning its
forecast for Medline are the ability of the Mills family and the
Sponsors to work together effectively and to reduce debt over the
near to medium term.
DERIVATION SUMMARY
Medline's 'B+'/Negative Long-Term IDR reflects its strong position
in the large and stable market for medical/surgical products. The
company has established a wide array of branded products for sale
to acute care, post-acute care, physician office and surgery center
markets. The company's vertical integration of manufacturing
capabilities, distribution network and global sourcing
relationships differentiates Medline from its principal
competition: Cardinal Health, Inc. (CAH; BBB/Stable), Owens &
Minor, Inc. (OMI; BB-/Stable) and McKesson Corporation (MCK;
BBB+/Stable). Medline's strategy of leading with manufactured
products helps to subsidize and win prime-vendor relationships with
large integrated delivery networks.
Private label products comprise a majority of Medline's revenue and
gross profits compared to significantly lower amounts for CAH and
OMI. While OMI, CAH and MCK focus on parts of the acute care,
post-acute care, physician office and surgery center markets, only
CAH has a comparable segment focus and level of price
competitiveness. The company's EBITDA margins are significantly
higher than other distributors (including AmerisourceBergen)
because of the amount of branded products that it sells. Fitch
believes that private label products offer higher margins, albeit
at lower price points.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
-- Revenue increases at a CAGR of approximately 5% over the
period 2021-2025 (the forecast period);
-- EBITDA margins are maintained at approximately 10.0%-10.5%
over the forecast period;
-- Working capital changes represent a use of cash of
approximately $150 million-$200 million each year over the
forecast period;
-- Capex of approximately $400 million per year;
-- Cash distributions made for equity investors' tax liabilities
of approximately $300 million-$350 million over the forecast
period;
-- FCF is used principally to fund MPU payments in 2022 and 2023
and thereafter to reduce debt; discretionary debt reduction is
used while maintaining cash balances of at least $200 million.
-- Secured mortgage debt of $2.230 billion is assumed to be
senior to all other senior secured and senior unsecured debt.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Expectation of sustaining gross debt/EBITDA (including secured
mortgage debt) at or below 5.0x by the end of fiscal 2023;
-- FCF of approximately $750 million-$1.0 billion/year is applied
to the reduction of debt over the next three years;
-- Operational strength demonstrated by customer retention and
market share growth leading to increasing CFO;
-- Expectation of EBITDA margins remaining above 13% and FCF/debt
remains consistently above 10%.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Expectation of sustaining gross debt/EBITDA (including secured
mortgage debt) at or above 6.0x by the end of fiscal 2023;
-- FCF is not used principally for debt reduction;
-- Total revenue growth rate declines to low-to-mid-single digits
as a result of customer turnover and price concessions;
-- Expectation of EBITDA margins falling below 10% and FCF/debt
remaining consistently below 5%.
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
Ample Liquidity: Fitch expects Medline's cash flow from operations,
together with its revolving credit facility (RCF), will be
sufficient to fund its long-term and short-term capex, working
capital and debt service requirements. The company's RCF has a
financial covenant that provides ample room to borrow in the event
of liquidity stress. Fitch expects modest use of the RCF to fund
working capital needs.
Cash and cash equivalents are expected to remain above $200 million
over the forecast period and interest coverage (operating
EBITDA/interest paid) is expected to remain above 2.5x.
Debt Maturities: The amortization of the term-loan B is expected to
be approximately $73 million/year through maturity in 2028 and all
debt maturities are at least five years or longer; hence,
refinancing risk remains low over the forecast period (through
2025). It remains to be determined whether Medline will apply most
of its FCF in 2022 and 2023 for MPU payments; thereafter, Fitch
assumes substantially all of the FCF is used to pay debt, except
for the application for "tuck-in" acquisitions.
Rating Recovery Assumptions
Fitch estimates an enterprise value (EV) on a going-concern basis
of approximately $10.125 billion for Medline, after deduction of
10% for administrative claims. The EV assumption is based on a
post-reorganization EBITDA of $1.5 billion and a 7.5x multiple;
neither assumption has not changed since Fitch's initial rating
assignment.
The post-reorganization EBITDA estimate is approximately 29% lower
than Fitch's 2021 adjusted EBITDA estimate. Fitch's estimate of the
post-reorganization EBITDA is premised on an EBITDA approximating
pre-pandemic levels, which assumes a significantly lower base of
revenues and, therefore EBITDA generation.
The 7.5x multiple employed for Medline reflects acquisition
multiples of healthcare distributors and trading ranges of Mozart's
peer group (CAH, OMI, MCK), which have fluctuated between 6x-12x in
the recent past.
Instrument ratings and RRs for Medline's debt instruments are based
on Fitch's Corporates Recovery Ratings and Instruments Ratings
Criteria. Fitch includes Medline's CMBS debt in its waterfall
(approximately $2.2 billion) that occupies a super-senior position.
The secured mortgage debt is assumed to be fully recovered before
the other senior secured and senior unsecured debt in the capital
structure and therefore is rated 'RR1'.
The waterfall analysis also includes secured credit facilities and
notes as follows: (1) a cash flow revolving credit facility
(assumed to be fully drawn on $1.0 billion capacity; Fitch's
initial rating recovery analysis assumed an 80% draw or $800
million), (2) secured term loans (approximately $7.8 billion USD
equivalent); and (3) other secured debt (approximately $4.5
billion). The secured debt is expected to recover in a range of
51%-70% and therefore is rated 'RR3'.
Medline's senior unsecured debt of $2.5 billion ranks below other
secured debt and is estimated to have a recovery in a range of
0%-10%; therefore, it is rated 'RR6'. Fitch has assumed 2% of the
recovery value available to senior creditors is allocated to the
senior unsecured debt.
ISSUER PROFILE
Medline is the largest U.S.-based privately held manufacturer and
distributor of health care supplies to hospitals, post-acute
settings, physician offices and surgery centers.
ESG CONSIDERATIONS
Medline has an ESG Relevance Score of '4' for Governance Structure,
because of the challenge of managing financial policy and capital
allocation objectives among the Mills family and the new major
shareholders. This has a negative impact on the credit profile and
is relevant to the rating in conjunction with other factors.
Medline has an ESG Relevance Score of '4' for Group Structure,
because of its complex capital structure and use of secured
mortgage debt to fund a material portion of the acquisition of the
company. This has a negative impact on the credit profile and is
relevant to the rating in conjunction with other factors.
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.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch adjusted reported EBITDA to remove non-recurring costs,
inventory normalization adjustments and non-operating
income/expense. In addition, for the forecast periods, Fitch's
leverage metrics include CMBS debt.
DEBT RATING RECOVERY PRIOR
--- ------ -------- -----
Medline Co-Issuer, Inc.
senior unsecured LT B- Affirmed RR6 B-
senior secured LT BB- Affirmed RR3 BB-
Mozart Holdings, LP LT IDR B+ New Rating
Medline Borrower, LP LT IDR B+ Affirmed B+
senior unsecured LT B- Affirmed RR6 B-
senior secured LT BB- Affirmed RR3 BB-
MID ATLANTIC PRINTERS: Expects to Pay Over 40% to Unsecureds
------------------------------------------------------------
Mid Atlantic Printers, Ltd., submitted a Fourth Amended Plan of
Reorganization dated April 18, 2022.
As of the date of this Plan, the Debtor is current with its post
petition tax filings and payroll tax deposits. The Debtor is also
current with its post-petition obligations. It appears that the
Debtor is operating profitably and will be able to fund its Plan of
Reorganization.
Class 2 consists of the Bank of the James Secured Claim. The Bank
of the James secured claim is secured by a first position blanket
lien on the Debtor's accounts receivable, inventory, equipment
(excluding the Debtor's Heidelberg printing presses), and general
intangibles, and also a first lien Deed of Trust on the Debtor's
real estate at 503 3rd Street in Altavista, Virginia. The Bank of
the James note requires monthly payments of approximately $2,400.00
per month until the note is paid in full. The balance on the note
as of the petition date was $175,331.00 according to Bank of the
James' proof of claim.
The Debtor is current in its payments to Bank of the James, having
made its October, November and December post-petition payments. The
Debtor and Bank of the James entered into a post-petition cash
collateral agreement, which has been approved by the Court, which
contemplates that the Debtor will continue to make its monthly
payments and will continue to maintain adequate insurance on all of
its property. The Class 2 Claim shall be treated as follows:
* The Debtor shall continue to make regular monthly payments
directly to Bank of the James in accordance with the secured
creditor's note and security documents.
* The Debtor shall continue to operate in accordance and in
compliance with the Cash Collateral Order.
* The Bank of the James shall retain its lien on the Debtor's
real and personal property.
Class 3 consists of Campbell County Secured and Priority Claims.
Campbell County, pursuant to its proofs of claim, asserts a secured
claim against the Debtor's personal property in the amount of
$24,730.00 and a priority claim in the amount of $2,204.00. The
Class 3 secured and priority claims shall be treated as follows:
* Upon the Effective Date of the Plan, the Debtor will
commence monthly payments to Campbell County sufficient to pay its
secured and priority claims in full over a period of 5 years with
an interest rate of 4 percent. This treatment shall be Campbell
County's treatment pursuant to its currently filed claim or any
amendments that Campbell County may file after the filing of this
4th Amended Plan. Although the Debtor reserves the right to object
to the Campbell County secured claim, provided the claim is allowed
in the amount of the proof of claim filed, the Debtor's monthly
payment to this Class 3 creditor will be $496.00.
* Post-petition, the Debtor will make the Campbell County
personal property tax claims on time as they become due.
* Campbell County shall retain its lien on the Debtor's
personal property.
Class 11 consists of General Unsecured Claims. As a result of a
review of its chapter 11 schedules and the claims that have been
filed in this case as of the claims bar date of January 5, 2022,
the Debtor estimates its general unsecured claims to be
approximately $650,000.00.
On a quarterly basis commencing the next calendar quarter after the
Effective Date, and for a period of 5 years following or the date
that all class 9 claims are paid in full, whichever is sooner, and
after paying outstanding Class 1 claims, the Debtor will commit all
of its disposable income to the Mid Atlantic Printers
Reorganization Fund. From the Mid Atlantic Printers Reorganization
Fund, the Debtor will make quarterly pro-rata distributions to
allowed General Unsecured Claims. The Debtor will fund its
obligation to the Mid Atlantic Printer Reorganization Fund with its
aggregate disposal income within 30 days from the end of each
quarter.
Thus, provided an Effective Date prior to September 30, 2022, the
first payment will be due October 30, 2022, thirty (30) days from
the end of the quarter that ends September 30, 2022. If the
Debtor's revenue and expenses projections are accurate, Class 11
creditors can expect to receive over 50% of their claims, even
without a recovery from the insurance claim or preference claims.
The Debtor will continue its operations as a commercial printer
servicing its customers in the ordinary course of business. Rob
Poindexter will continue in his role as Chief Operating Office of
the Debtor. His salary will be increased by $2,500.00 per month,
recognizing his greatly expanded role as he continues to serve as
plant manager, and now oversees all operations and financial
aspects of the company as chief operating officer.
The Debtor will pursue avoidable preferences and other avoidance
actions as it deems appropriate. Pursuant to its schedules, the
Debtor paid over $300,000.00 on its American Express credit card in
the 90 days prior to the petition date. According to proofs of
claim filed in the case, American Express was owed no more than
$45,000.00 as of the petition date.
A full-text copy of the Fourth Amended Plan dated April 18, 2022,
is available at https://bit.ly/36FCSDh from PacerMonitor.com at no
charge.
Counsel for the Debtor:
Andrew S. Goldstein, Esq.
Magee Goldstein Lasky & Sayers, P.C.
P.O. Box 404
Roanoke, VA 24003-0404
Tel: (540) 343-9800
Fax: (540) 343-9898
Email: agoldstein@mglspc.com
About Mid Atlantic Printers Ltd.
Mid Atlantic Printers, Ltd., is a full service commercial sheet fed
printer, with two production facilities and multiple sales offices.
The Altavista, Va.-based company offers commercial printing
services.
Mid Atlantic Printers filed a petition for Chapter 11 protection
(Bankr. W.D. Va. Case No. 21-61173) on Oct. 27, 2021, listing up to
$10 million in assets and up to $1 million in liabilities. Nancy
Edwards, president of Mid Atlantic Printers, signed the petition.
Andrew S. Goldstein, Esq., at Magee Goldstein Lasky & Sayers, P.C.,
serves as the Debtor's legal counsel.
MINNESOTA ATHLETIC: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------------
Debtor: Minnesota Athletic Apparel Inc.
5600 Felti Rd
Minnetonka, MN 55343-3931
Chapter 11 Petition Date: April 22, 2022
Court: United States Bankruptcy Court
District of Minnesota
Case No.: 22-40635
Debtor's Counsel: Joseph Dicker, Esq.
JOSEPH W. DICKER, P.A.
1406 W Lake St Ste 209
Minneapolis, MN 55408-2653
E-mail: joe@joedickerlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Steve Gnoza as president.
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/3G2GIPY/Minnesota_Athletic_Apparel_Inc__mnbke-22-40635__0001.0.pdf?mcid=tGE4TAMA
MINOTAUR ACQUISITION: Moody's Affirms 'B3' CFR, Outlook Stable
--------------------------------------------------------------
Moody's Investors Service affirmed Minotaur Acquisition, Inc.'s B3
corporate family rating, B2 backed senior secured first lien term
loan and revolving credit facility ratings and affirmed its Caa2
backed senior secured second lien term loan rating. Minotaur's
outlook remains stable. Minotaur is the debt-issuing entity of
Millennium Trust Company, LLC (Millennium). The rating action
follows the announcement that Millennium has signed a definitive
agreement to acquire PayFlex Holdings, Inc. (PayFlex), a provider
of health savings accounts (HSAs) and consumer-directed benefit
administration services, from CVS Health Corporation (CVS Health).
To fund the acquisition, Minotaur expects to issue a $485 million
add-on to its first lien term loan.
Affirmations:
Issuer: Minotaur Acquisition, Inc.
Corporate Family Rating, Affirmed at B3
Backed Senior Secured First Lien Revolving Credit Facility,
Affirmed at B2
Backed Senior Secured First Lien Term Loan, Affirmed at B2
Backed Senior Secured Second Lien Term Loan, Affirmed at Caa2
Outlook Actions:
Issuer: Minotaur Acquisition, Inc.
Outlook, remains Stable
RATINGS RATIONALE
Moody's said the ratings' affirmation reflects the sound rationale
for the PayFlex acquisition which mitigates additional credit risks
from the increase in leverage needed to fund the transaction. The
acquisition will add approximately 2.4 million customer accounts
and $4 billion in client assets. This will bring Minotaur's total
customer accounts to around 5 million and total client assets to
$47 billion. The transaction will extend Minotaur's custodial and
record-keeping services to the HSA market. Moody's expects the
economics of the PayFlex business to be very similar to Minotaur's
existing businesses, consisting of account fees and cash sweep
income earned on client cash balances. Additionally, in connection
with the acquisition, Minotaur will enter into a long-term
commercial relationship with affiliates of Aetna Inc. (Aetna), a
CVS Health company. Under the agreement, PayFlex will remain
Aetna's preferred provider of HSAs and certain other
consumer-directed benefit solutions for Aetna's existing and
prospective healthcare plan client base. This agreement is also an
important consideration underlying the ratings affirmation as it
will allow for a stable and consistent base of customers and
pipeline for new accounts at PayFlex.
Based on the number of accounts and client assets acquired, this
acquisition is sizeable. In addition, Minotaur is paying a sizeable
EBITDA multiple, and the purchase price will greatly exceed
available balance sheet cash. To fund the acquisition Minotaur
expects to issue a $485 million add-on to its first lien term loan,
$175 million of preferred equity and $65 million of common equity.
Although Minotaur has improved its trailing-12-months debt / EBITDA
ratio on a Moody's adjusted basis to around 4.9x at September 30,
2021, compared to 5.6x at December 31, 2020 and 6.3x at December
31, 2019, on a pro-forma basis which includes the proposed debt
issuance and added performance from PayFlex, Moody's expects
Minotaur's leverage ratio will return to around 6.2x at the end of
2022.
The ratings affirmation also reflects Minotaur's strong growth in
customer accounts and client cash, high EBITDA margin and market
leadership in the automatic rollover individual retirement account
(IRA) market. Minotaur takes a prudent approach to its cash sweep
program, which is laddered over a number of years and benefits from
fixed deposit arrangements across a number of partner banks.
Moody's expects that Minotaur will apply the same framework to the
deposits it acquires from PayFlex, where client cash has generated
relatively de minimis returns recently. The ratings also reflect
Minotaur's small scale, weak (albeit improving) pretax earnings,
sensitivity to interest rates, and its ownership by a financial
sponsor which could result in aggressive financial management
actions over time such as further increases in debt leverage.
Moody's also said the affirmation reflects the expectation for
higher interest rates throughout the rest of 2022 and 2023. The
Federal Reserve's rate hike cycle is underway with a 25 basis point
increase following its March 2022 meeting. Moody's currently
expects a series of rate increases in 2022 and 2023, assuming
interest rates will be increased in 25 bps increments. This will
benefit Minotaur's service and administrative fee revenue. Although
a large portion of Minotaur's high-yielding deposit contracts
expired in 2021, higher interest rates and strong account growth
will reduce the overall negative impact on this source of revenue.
Based on the laddering and expiration of Minotaur's existing cash
sweeps, Moody's still expects a modest decline in
interest-rate-linked revenue during 2022. However, Minotaur's
strong growth in customer accounts and client cash, as well as its
ability to generate positive operating leverage will eventually
offset these declines.
The stable outlook reflects the manageable execution risks
associated with this acquisition as well as improved prospects for
Minotaur's revenues from a changed interest rate environment,
Moody's expectation of continued growth in customer accounts and
client cash, and continued positive operating leverage.
In accordance with Moody's Loss Given Default (LGD) for
Speculative-Grade Companies methodology and model and the firm's
proposed capital structure, the B2 ratings on Minotaur's $595
million first lien term loan, $485 million first lien term loan
add-on and $90 million revolving credit facility reflect their
priority ranking in Minotaur's capital structure. The Caa2 rating
on Minotaur's $245 million second lien term loan reflects the
facility's secondary ranking in Minotaur's capital structure.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Minotaur's ratings could be upgraded should it expand its revenue
streams or develop new revenue sources within the self-directed IRA
or fund custody activities that would reduce reliance on interest
rates.
The demonstration of a more creditor-friendly financial policy,
such as paying-down debt or organically deleveraging to levels
below 5.0x on a sustained basis, could also result in an upgrade.
Minotaur's ratings could be downgraded should it demonstrate
increasingly aggressive financial policies through a significant
increase in debt leverage to fund shareholder dividends, the
PayFlex acquisition, or additional acquisitions.
Failure to properly integrate the planned acquisition of PayFlex,
or a reduction in accounts, client assets and related revenue at
PayFlex that reduces the combined entity's profits and margins
could lead to a downgrade.
The ratings could also be downgraded should interest rates remain
very low and result in significant profitability erosion not offset
by cost management or other revenue streams, or with indication
that the firm is willing to take on more interest rate risk.
A significant deterioration in franchise value from legal,
regulatory, compliance or other issues that would reduce revenue,
increase costs, and damage relations with record-keepers and plan
sponsors could also result in a downgrade.
The principal methodology used in these ratings was Securities
Industry Service Providers Methodology published in November 2019.
Minotaur Acquisition, Inc. is the acquisition vehicle through which
entities of Abry Partners acquired Millennium Trust Company, LLC,
which operates as a trust company under the laws of the state of
Illinois. Millennium is based in Oak Brook, Illinois and provides
administration and custodial services for retirement accounts to
individuals, advisors and institutions as well as other
institutional services.
MONTAUK CLIFFS: Files Amendment to Disclosure Statement
-------------------------------------------------------
Montauk Cliffs, LLC, submitted an Amended Disclosure Statement for
the Amended Chapter 11 Plan of Liquidation dated April 19, 2022.
The Plan is premised upon a Sale of the Property free and clear of
all liens, claims and encumbrances. The Debtor, through a broker to
be retained in the Chapter 11 Case, shall market the Property from
entry of the order authorizing the broker's retention until the
broker issues a call for offers. The Debtor, in consultation with
the Lender, has selected Hedgerow Exclusive Properties ("Hedgerow")
as the broker to market the Property.
Hedgerow will develop a marketing plan and work towards execution
of a contract with a purchaser for the highest price possible.
Hedgerow shall make a call for offers between the dates of June 30,
2022 and July 31, 2022, the precise date which shall be determined
by Hedgerow based upon Hedgerow's professional judgment and
pursuant to a marketing plan approved by the Debtor and the Lender.
The period from the date on which an Order is entered approving the
retention of Hedgerow and the date on which the foregoing call for
offers is made by Hedgerow shall be referred to as the "Marketing
Period."
At the conclusion of the Marketing Period, the Debtor shall file
the 363 Motion seeking entry of an order authorizing the sale of
the Property free and clear of all liens, claims and encumbrances.
If no contract satisfactory to the Lender is executed within such
Marketing Period (or such additional time as is agreed to by the
Lender in its sole and absolute discretion), the Sale Motion shall
seek an order approving a Sale to the Lender or its designee by
credit bid, which sale shall close on or before the 30th day
following the call for offers.
The Sale Expenses will be paid from the proceeds of the Sale. Any
Allowed Secured Real Estate Tax Claims shall also be paid at the
closing of the Sale. Pursuant to section 1146(a) of the Bankruptcy
Code, the Sale of the Property shall not be subject to any stamp,
transfer or similar tax. The remaining proceeds of the Sale shall
be paid as follows:
* In the event of a Sale in an amount of $28,000,000 or less
(net of all Sale Expenses and the Secured Real Estate Tax Claims),
title to the Property shall be transferred to the Lender or its
designee by way of credit bid or to the actual Cash bidder in the
sole and absolute discretion of the Lender. In the event that the
Property shall be transferred to the Lender or its designee by way
of credit bid, the current occupants of the Property, including,
without limitation, Eli Wilner, shall vacate the Property no later
than 30 days following the conclusion of the Marketing Period (the
"Deadline to Vacate"); provided however that should the Marketing
Period end through a call for offers prior to July 15, 2022, and
Lender or its designee is the successful bidder by way of credit
bid, then in no event shall the Deadline to Vacate occur prior to
August 15, 2022.
* In the event that the Property shall be transferred to an
entity other than the Lender or its designee by way of credit bid,
all current occupants of the Property, including Eli Wilner, shall
vacate the Property on or before the Deadline to Vacate, or such
other period as determined by and agreed to by such third-party
buyer (i.e., a purchaser other than the Lender or its designee).
Like in the prior iteration of the Plan, each holder of Class 4
General Unsecured Claim shall be paid pro rata from the Creditor
Carve Out and pro rata from the Excess Debtor Proceeds, up to the
full amount of their Claims. Creditors will recover 10% to 100% of
their claims.
Class 5 includes the holders of Equity Interests in the Debtor.
Such holders shall receive the remainder of the Sale proceeds after
payment of all Allowed Claims.
The Plan will be funded from the proceeds of the Sale. It is
anticipated that all creditors will receive a distribution from the
Sale proceeds.
A full-text copy of the Amended Disclosure Statement dated April
19, 2022, is available at https://bit.ly/3vaiRyb from
PacerMonitor.com at no charge.
Attorneys for the Montauk Cliffs, LLC:
Matthew G. Roseman, Esq.
Bonnie L. Pollack, Esq.
Michael Traison, Esq.
CULLEN & DYKMAN LLP
100 Quentin Roosevelt Boulevard
Garden City, NY11530
Tel: (516) 357-3700
About Montauk Cliffs
Montauk Cliffs LLC is a real estate company that owns the Montauk
Mansion in Montauk, New York.
Montauk Cliffs LLC sought Chapter 11 bankruptcy protection (Bankr.
E.D.N.Y. Case No. 70312) on Feb. 23, 2022. In the petition filed by
Eli Wilner as manager, Montauk CLiffs LLC listed estimated assets
between $10 million and $50 million and estimated liabilities
between $10 million and $50 million. The case is handled by
Honorable Judge Robert E. Grossman. Matthew G. Roseman, Esq.,
CULLEN AND DYKMAN LLP, is the Debtor's counsel.
NB HOTELS: Files Emergency Bid to Use Cash Collateral
-----------------------------------------------------
NB Hotels Dallas LLC asks the U.S. Bankruptcy Court for the
Northern District of Texas, Dallas Division, for authority to use
the cash collateral of:
-- Wells Fargo Bank, National Association as Trustee for
Morgan Stanley Capital I Trust 2019-L2 for the benefit of the
Commercial Mortgage Pass-Through Certificate Holders; and
-- the U.S. Small Business Administration,
and provide adequate protection.
The Debtor filed the Chapter 11 case having suffered through two
years of the COVID-19 pandemic. The loss of revenue as a result of
the pandemic placed the Debtor behind on certain payments.
The Debtor intends to rearrange its affairs and needs to continue
operating in order to pay its ongoing expenses, generate additional
income, and propose a plan in the case. Access to cash collateral
will allow the Debtors to continue ongoing operations.
The Debtor contends it can adequately protect the interests of the
Secured Lenders by providing them with post-petition liens, a
priority claim in the Chapter 11 bankruptcy case, and ultimately
cash flow payments.
The Debtor made its request on an emergency basis as it has no
outside sources of funding available to it and must rely on the use
of cash collateral to continue operations.
A copy of the motion is available at https://bit.ly/3jW04QM from
PacerMonitor.com.
About NB Hotels Dallas LLC
NB Hotels Dallas LLC owns and operates the Le Meridien Hotel Dallas
located at 13402 Noel Road, Dallas, Texas. The Debtor sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
N.D. Tex. Case No. 22-30681) on April 18, 2022. In the petition
signed by Nadir Badruddin, its president, the Debtor disclosed up
to $100 million in both assets and liabilities.
Judge Harlin Dewayne Hale oversees the case.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC is the
Debtor's counsel.
NORDIC AVIATION: Norton, et al. 2nd Update on Secured Lender Group
------------------------------------------------------------------
In the Chapter 11 cases of Nordic Aviation Capital Designated
Activity Company, et al., the law firms of Weil, Gotshal & Manges
LLP, Norton Rose Fulbright LLP, and McGuireWoods LLP submitted a
second supplemental verified statement under Rule 2019 of the
Federal Rules of Bankruptcy Procedure, to disclose an updated list
of ad hoc group of secured lenders that they are representing.
The Ad Hoc Group retained Counsel to represent it in connection
with a potential restructuring of the Debtors.
On December 20, 2021, Counsel filed with the Court in these chapter
11 cases the Verified Statement Regarding Ad Hoc Group of Secured
Lenders Pursuant to Bankruptcy Rule 2019. On February 27, 2022,
Counsel filed with the Court the Supplemental Verified Statement
Regarding Ad Hoc Group of Secured Lenders Pursuant to Bankruptcy
Rule 2019. Pursuant to Bankruptcy Rule 2019(d), this Second
Supplemental Verified Statement supplements the information
provided in the First Supplemental Verified Statement.
Other than NRF's representation of Wells Fargo Bank, N.A., Wells
Fargo Trust Company, N.A., Wilmington Trust Limited, and DVB Bank
SE, London Branch, Counsel represents only the Ad Hoc Group and
does not represent or purport to represent any entities other than
the Ad Hoc Group in connection with the Debtors' chapter 11 cases.
In addition, each member of the Ad Hoc Group is acting for its own
interest, and does not purport to act, represent, or speak on
behalf of any other entities, including other affiliated entities
that may hold claims against the Debtors, in connection with the
Debtors' chapter 11 cases.
As of April 18, 2022, members of the Ad Hoc Group and their
disclosable economic interests are:
Allstate Investments, LLC
3075 Sanders Road
Northbrook, Illinois, 60062
with Copy to:
Allstate Investments
444 West Lake Street, Suite 4500
Chicago, Il 60606
* NAC 8 Senior Facility: $18,558,558
* NAC 29 Financing Arrangements: $8,254,533
Apple Bank for Savings
122 East 42nd Street, 9th Floor
New York, NY 10168
* NAC 8 Senior Facility: $19,765,338
* NAC 27 Facility: $22,575,518
Barings LLC
300 South Tryon, St., Suite 2500
Charlotte, NC 28202
* NAC 8 Senior Facility: $39,085,198
* NAC 29 Financing Arrangements: $108,111,542
Cairn Capital Limited
62 Buckingham Gate
London SW1E 6AJ
* NAC 31 JOLCO Facility: $12,874,266
* NAC 32 JOLCO Facility: $13,270,787
* NAL 27 JOLCO Facility: $17,655,111
* NAL 28 JOLCO Facility: $25,232,806
Citigroup Financial Products Inc.
1209 Orange Street
Wilmington, DE, 19801
Citibank Europe PLC
1 North Wall Quay
Dublin 1, Ireland
Citigroup Global Markets Limited
Citigroup Centre, Canada Square
London E14 5LB
* NAC 8 Senior Facility: $1,607,409
* NAC 27 Facility: $8,376,717
* NAC 25 Facility: $5,000,000
* NAC 29 Financing Arrangements: $30,666,587
Credit Industriel et Commercial
Financement d'Actifs
4 rue Gaillon,
Paris, France, 75002
Attn: Stephane Bisiaux-Outeiral
Damien Wolff, and Julien Natrella
* NAC 27 Facility: $22,575,518
Development Bank of Japan Inc.
Otemachi Financial City South Tower
9-6, Otemachi 1-chome, Chiyoda-ku,
Tokyo 100-8178, Japan
* NAL 18 JOLCO Facility: $1,945,609
* NAL 20 JOLCO Facility: $2,056,335
* NAL 21 JOLCO Facility: $2,114,337
* NAL 22 JOLCO Facility: $3,872,102
* NAL 23 JOLCO Facility: $4,245,850
* NAL 24 JOLCO Facility: $4,280,328
Export Development Canada
150 Slater Street
Ottawa, ON, Canada K1A 1K3
* EDC Facilities: $344,602,190
Investec Bank PLC
30 Gresham Street
London EC2V 7QP
United Kingdom
* NAC 8 Senior Facility: $32,643,842
Invesco Senior Secured Management, Inc.
225 Liberty Street
New York NY 10281
* NAC 8 Junior Facility: $29,640,627
Ironshield Capital Management LLP
7-8 Stratford Place
London W1C 1AY, United Kingdom
* NAC 27 Facility: 4,035,573
* NAC 29 Facility Agreements: $1,000,000
* NAC 33 Facility: $16,391,845
* NAC 34 Facility: $4,649,558
J.P. Morgan Securities PLC
25 Bank Street, 4th Floor,
London E14 5JP, United Kingdom
* NAC 31 JOLCO Facility: $8,079,694
* NAC 32 JOLCO Facility: $8,328,568
* NAL 27 JOLCO Facility: $11,080,090
* NAL 28 JOLCO Facility: $15,835,744
* NAC 29 Financing Arrangements: $37,910,643
* Facility Y Financing Arrangements: $18,715,635
Mizuho Leasing Company, Limited
1-2-6 Toranomon, Minato-ku
Tokyo 105-0001, Japan
* NAC 27 Facility: $21,041,508
MUFG Bank Ltd.
Ropemaker Place
25 Ropemaker Street
London, EC2Y 9AN
* NAC 33 Facility: $43,780,848
* NAC 34 Facility: $12,543,318
* NAL 18 JOLCO Facility: $3,891,219
* NAL 20 JOLCO Facility: $4,112,669
* NAL 21 JOLCO Facility: $4,228,674
* NAL 22 JOLCO Facility: $3,872,102
* NAL 23 JOLCO Facility: $4,245,850
* NAL 24 JOLCO Facility: $4,280,327
New York Life Insurance Company; and
New York Life Insurance and Annuity Corporation
51 Madison Avenue, 2nd Floor
New York, NY 10010
Attn: Structured Finance Group
* NAC 8 Senior Facility: $39,085,084
* NYL Financing Arrangements: $91,396,746
The Korea Development Bank
GranTokyo North Tower 36F, 1-9-1
Marunouchi, Chiyoda-ku
Tokyo, 100-6736
Japan
* NAL 18 JOLCO Facility: $3,891,219
* NAL 20 JOLCO Facility: $4,112,669
* NAL 21 JOLCO Facility: $4,228,674
* NAL 22 JOLCO Facility: $3,872,102
* NAL 23 JOLCO Facility: $4,245,850
* NAL 24 JOLCO Facility: $4,280,327
The Tokyo Star Bank, Limited
2-3-5 Akasaka, Minato-ku
Tokyo 107-8480, Japan
* NAC 29 Facilities Group: $17,241,472
* NAC 31 JOLCO Facility: $1,378,191
* NAC 32 JOLCO Facility: $1,420,635
* NAC 33 Facility: $4,878,356
* NAC 34 Facility: $1,383,749
* NAL 27 JOLCO Facility: $1,889,985
* NAL 28 JOLCO Facility: $2,701,178
Co-Counsel for the Ad Hoc Group of Secured Lenders can be reached
at:
K. Elizabeth Sieg, Esq.
Sarah B. Boehm, Esq.
McGUIREWOODS LLP
Gateway Plaza
800 East Canal Street
Richmond, VA 23219
Telephone: (804) 775-1000
Facsimile: (804) 775-1061
E-mail: bsieg@McGuireWoods.com
sboehm@McGuireWoods.com
Matthew S. Barr, Esq.
Kelly DiBlasi, Esq.
David J. Cohen, Esq.
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, NY 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
E-mail: Matt.Barr@weil.com
Kelly.DiBlasi@weil.com
DavidJ.Cohen@weil.com
- and -
Steve Dollar, Esq.
David Rosenzweig, Esq.
Anthony Lauriello, Esq.
NORTON ROSE FULBRIGHT US LLP
1301 Avenue of the Americas
New York, NY 10019
Telephone: (212) 318-3000
E-mail: steve.dollar@nortonrosefulbright.com
david.rosenzweig@nortonrosefulbright.com
anthony.lauriello@nortonrosefulbright.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/37DuXXH and https://bit.ly/3vjdfSx
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.
OCEANEERING INT'L: Egan-Jones Maintains 'B-' Unsec. Debt Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on March 29, 2022, maintained its 'B-'
foreign currency and local currency senior unsecured ratings on
debt issued by Oceaneering International, Inc. EJR also maintained
its 'B' rating on commercial paper issued by the Company.
Headquartered in Houston, Texas, Oceaneering International, Inc.
provides engineering services.
OPTIV INC: Moody's Upgrades CFR & 1st Lien Secured Term Loan to B3
------------------------------------------------------------------
Moody's Investors Service upgraded Optiv Inc.'s Corporate Family
Rating to B3 from Caa1 and Probability of Default Rating to B3-PD
from Caa1-PD. Concurrently, Moody's upgraded the company's first
lien senior secured term loan to B3 from Caa1 and second lien
senior secured term loan to Caa2 from Caa3. The outlook is stable.
The upgrade reflects Optiv's improving performance and credit
metrics and Moody's expectation of continued growth in security
products and security services revenue and EBITDA. Gross Revenue
grew 13% in 2021 and leverage excluding certain one-time costs
improved to around 7x from around 9x in 2019. Free cash flow (FCF)
has been positive for the last few years.
RATINGS RATIONALE
The B3 CFR is driven by Optiv's high, but improving, leverage and
low margins. Optiv ratings benefit from the company's leading
position as a provider of security solutions and in-house security
service offerings. Optiv is one of the largest value added
resellers of security software and hardware with likely the
broadest sales and engineering coverage in the US. Debt to EBITDA
excluding certain one-time charges was around 7x for the twelve
month period ending December 31, 2021 (and over 7.5x including
those costs). The company has the potential to de-lever to around
6x over the next 12-18 months in the absence of debt funded
acquisitions. EBITDA margins are expected to remain in the mid 4%
range of gross revenue reflecting the relative size and nature of
the company's distribution model.
The stable outlook reflects Moody's expectation for continued high
single digit or better sales and EBITDA growth, with the potential
for leverage to decline to around 6x and free cash flow to debt to
be sustained in the mid-single digit range over the next 12 to 18
months in the absence of debt funded acquisitions. The stable
outlook accommodates a moderate increase in acquisition activity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company is able to sustain
leverage below 6x and free cash flow to debt greater than 5%. The
ratings could be downgraded if revenues decline and margins
deteriorate or leverage is greater than 8x on other than a
temporary basis. The ratings could also be downgraded if liquidity
is constrained.
Optiv's liquidity is good, supported by $53 million of cash as of
December 31, 2021, and a $200 million receivables based revolving
credit facility due April 2024. Availability under the revolver was
approximately $190 million as of December 31, 2021. Additionally,
Moody's expects the company to generate positive free cash flow
over the next 12 to 18 months. Other than outstanding letters of
credit there were no borrowings under the ABL as of year-end but
the company uses its ABL to fund working capital throughout any
given quarter.
Upgrades:
Issuer: Optiv Inc.
Corporate Family Rating, Upgraded to B3 from Caa1
Probability of Default Rating, Upgraded to B3-PD from Caa1-PD
Senior Secured 1st Lien Term Loan, Upgraded to B3 (LGD4) from Caa1
(LGD3)
Senior Secured 2nd Lien Term Loan, Upgraded to Caa2 (LGD5) from
Caa3 (LGD5)
Outlook Actions:
Issuer: Optiv Inc.
Outlook, Changed To Stable From Positive
Optiv is a value-added-reseller of cyber security technology and
provider of cyber security services. The company headquartered in
Denver, CO, had gross revenues of about $2.9 billion for the twelve
months ended December 31, 2021. The company was acquired by private
equity firm KKR in 2017.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
OUTCOMES GROUP: Moody's Affirms B3 CFR & Rates First Lien Loan B3
-----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of Outcomes Group
Holdings, Inc. parent company of Paradigm Acquisition Corp.,
including the B3 Corporate Family Rating, the B3-PD Probability of
Default Rating and the Caa2 second lien senior secured rating. At
the same time, Moody's downgraded the first lien senior secured
rating to B3 from B2 reflecting the higher quantum of first lien
debt within the new capital structure. Moody's also assigned a B3
rating to the company's proposed incremental first lien senior
secured term loan, and a Caa2 rating to the company's incremental
second lien senior secured term loan. The proceeds from the credit
facilities, will fund a shareholder dividend, repay all outstanding
amount of the revolver, and pay transaction fees and expenses. The
rating outlook is stable.
The ratings affirmation reflects Paradigm's strong operating
performance, including during the coronavirus pandemic, and ample
cash flow generation. While leverage will increase to 6.5x pro
forma for the proposed debt-funded dividend and acquisition of
HomeCare Connect, Moody's expects earnings growth and debt
repayment that will allow leverage to improve to below 6.0x within
12-18 months.
Ratings affirmed:
Outcomes Group Holdings, Inc.
Corporate Family Rating, at B3
Probability of Default Rating, at B3-PD
Senior secured second lien term loan, at Caa2, to (LGD6) from
(LGD5)
Ratings downgraded:
Outcomes Group Holdings, Inc.
Senior secured first lien bank credit facility, downgraded to B3
(LGD3) from B2 (LGD3)
Ratings assigned:
Outcomes Group Holdings, Inc.
New Senior secured first lien term loan, assigned B3 (LGD3)
New Senior secured second lien term loan, assigned Caa2 (LGD6)
New Senior secured first lien revolving credit facility, assigned
B3 (LGD3)
The rating outlook is stable.
RATINGS RATIONALE
Paradigm's B3 rating is constrained by high financial leverage. Pro
forma for the debt-funded shareholder distribution, the company's
adjusted debt/EBITDA is 6.5x. However, with earnings growth,
Moody's forecasts leverage to decline to 6.2x by the end of 2022,
and 5.5x in 2023 in the absence of M&A and/or shareholder returns.
The rating also reflects the company's relatively high customer
concentration. The rating is supported by the company's leading
market position, high barriers to entry and solid earnings growth
prospects as it expands its service offerings. Further, Paradigm
has a good track record of organic revenue growth (even during the
pandemic) and managing the underwriting risk within its contracts.
Moody's expects that the company will generate solid free cash flow
despite its high debt/EBITDA.
In its stable outlook, Moody's expects Paradigm's operating
performance will remain robust, leading to solid cash generation
which will help reduce leverage to below 6.0x within 12 to 18
months. The stable outlook also reflects Moody's expectation that
Paradigm will maintain very good liquidity.
Moody's expect Paradigm to have very good liquidity over the next
12 to 18 months. Moody's expect annual free cash flow of at least
$70 million over the next 12-18 months. The company will have close
to $60 million of cash at close of the refinancing. There are no
near-term debt maturities and mandatory debt amortization is
modest, at 1% of the first lien term loan, or $6 million per year.
Liquidity is further supported by a $50 million revolver that will
expire in April 2025 (after 18-month extension). There is a
springing covenant on the revolver (8.15x first lien net leverage)
triggered upon 35% revolver utilization.
As proposed, the new credit facilities are expected to provide
covenant flexibility that if utilized could negatively impact
creditors. The credit facility contains incremental debt capacity
up to the greater of $89.7 million and 100.0% of consolidated
EBITDA, plus unlimited amounts so long as the secured net leverage
ratio does not exceed 5.30x (if pari passu secured), No portion of
the incremental debt may be incurred with an earlier maturity than
the initial first lien term loans.
Collateral leakage is permitted through transfers of assets to
unrestricted subsidiaries. Only subsidiaries that are wholly-owned
must act as subsidiary guarantors; dividends or transfers of
partial ownership interests could jeopardize guarantees, with no
explicit protective provisions limiting such releases.
The proposed terms and the final terms of the credit agreement may
be materially different.
ESG CONSIDERATIONS
ESG considerations are material to the ratings. Positive social
considerations include the growing demand from payors to improve
the value of care while controlling their costs. In this respect,
Paradigm has a strong track record of managing catastrophic
worker's compensation cases at a significantly lower cost than many
insurers and PPO networks. With respect to governance, private
equity ownership increases the risk of shareholder friendly actions
that come at the expense of creditors. The company also has shown
aggressive financial policy in the past with regards to sustained
elevated leverage.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded if the company's operating
performance deteriorates, if it becomes increasingly aggressive
with respect to dividends or acquisitions or if liquidity weakens.
Ratings could also be downgraded if free cash flow turns negative,
or if the company sustains debt to EBITDA above 7.0x.
The ratings could be upgraded if the company achieves greater scale
and customer diversification as well as maintain very good
liquidity. Further, if the company uses free cash flow to repay
debt or earnings grow such that debt to EBITDA is sustained below
6.0x, Moody's could upgrade the ratings.
Paradigm is a national provider of outsourced catastrophic worker's
compensation case management services. Under both risk-based and
fee-based contracts, the company provides services to insurance
companies and self-insured employers to improve medical outcomes
and reduce the costs associated with low frequency, high severity
work-related injuries. The company is privately owned by Ontario
Municipal Employees Retirement System ("OMERS") and generates
roughly $960 million in revenue.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
OUTFRONT MEDIA: Egan-Jones Retains CCC Sr. Unsecured Ratings
------------------------------------------------------------
Egan-Jones Ratings Company on March 31, 2022, maintained its 'CCC'
foreign currency and local currency senior unsecured ratings on
debt issued by OUTFRONT Media Inc. EJR also maintained its 'C'
rating on commercial paper issued by the Company.
Headquartered in New York, New York, OUTFRONT Media Inc. leases
advertising space on out-of-home advertising structures and sites.
OUTTA CONTROL: Seeks to Hire Famulari & Butto as Special Counsel
----------------------------------------------------------------
Outta Control Sportfishing, Inc. seeks approval from the U.S.
Bankruptcy Court for the Southern District of Florida to hire
Famulari & Butto, PLLC as its special counsel.
The firm's services include:
(a) advising the Debtor with respect to admiralty law
matters;
(b) continuing to represent the Debtor in the case styled
L.E.T. Holding of Hollywood, LLC v. M/V American Patriot and Ralph
Hawkins, Case No. 2:22-cv-89-JLB-NPM, which is pending in the U.S.
Middle District of Florida;
(c) assisting in the preparation of legal documents; and
(d) representing the Debtor in negotiation with its creditors
as they may relate to admiralty legal matters.
Famulari & Butto charges an hourly fee of $300 for its work. The
firm holds a retainer in the amount of $1,800.
Gino Butto, Esq., a partner at Famulari & Butto, disclosed in a
court filing that his firm is disinterested as required by Section
327(a) of the Bankruptcy Code.
The firm can be reached through:
Gino J. Butto, Esq.
Famulari & Butto, PLLC
2332 Galiano St., 2nd Floor
Coral Gables, FL 33134
Phone: (321) 749-4582
Email: gbutto@NauticalLawyers.com
About Outta Control Sportfishing
Outta Control Sportfishing, Inc., a company in Hollywood, Fla.,
filed a petition under Chapter 11, Subchapter V of the Bankruptcy
Code (Bankr. S.D. Fla. Case No. 22-12081) on March 16, 2022,
listing up to $500,000 in assets and up to $10 million in
liabilities. Tarek Kirk Kiem serves as Subchapter V trustee.
Judge Peter D. Russin presides over the case.
Richard R. Robles, Esq., at the Law Offices of Richard R. Robles,
P.A. and Famulari & Butto, PLLC serve as the Debtor's bankruptcy
counsel and special counsel, respectively.
OWENS & MINOR: Egan-Jones Retains BB- Sr. Unsecured Debt Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on March 29, 2022, maintained its 'BB-'
foreign currency and local currency senior unsecured ratings on
debt issued by Owens & Minor, Inc.
Headquartered in Virginia, Owens & Minor, Inc. distributes medical
and surgical supplies throughout the United States.
RCP VEGA: S&P Raises Issuer Credit Rating to 'B-', Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings raised all its ratings, including issuer credit
ratings on U.S.-based integrated payment and software solutions
provider for post-secondary education institutions RCP Vega Inc.
(doing business as Transact) and Transact Holdings Inc. by one
notch. The issuer credit ratings are 'B-', and its issue-level
rating on the company's first-lien debt is 'B'. The recovery rating
is '2'.
S&P said, "The stable outlook reflects our expectation that
Transact will reduce its leverage during 2022 while maintaining a
similar level of cash flow as 2021. We expect solid revenue and
earnings growth to continue as digital payment adoption and other
services grow on campus.
"Transact demonstrated resilient operating performance during the
pandemic and we expect the shift to digital payments on campus to
continue. The company grew its revenues from SmartPay and other
payment services related to tuition, fees, and room and board by
21% in 2021. Payments revenue represents 60% of the company's total
revenue and we expect continued business momentum into 2022.
Currently, about 50% of tuition payments in the U.S. are paid with
checks, and we expect Transact to benefit as more students and
parents change their payment habits to pay for these bills online
(specifically with debit or credit cards). Transact receives an
average of 1% in net transaction processing fees (after paying an
average of 1.75% to merchant acquirers) for facilitating payments
primarily though its SmartPay solution. Tuition amounts continue to
increase, which benefits the company's revenues. According to a
September 2021 U.S. News report, the average tuition and fees at
private ranked colleges increased by 1% for the 2021-2022 academic
year, and the average price for both in-state and out-of-state
tuition and fees at ranked public schools increased by around 1% to
2%. The company benefits from more usage on its SmartPay solution,
as well as adding new university customers. Despite the relatively
stagnant number of higher education institutions in the US, we
estimate that Transact has about a 15% share by number of
institutions it offers payment solutions to, which leaves room for
expansion. During 2021, management stated new customers drove a
third of SmartPay's revenue growth. We note the market for payment
services is highly competitive and primarily comes from companies
such as Nelnet and TouchNet (the latter is owned by Global
Payments). However, once a university signs on with a payments
vender, the relationship is usually very sticky with support from
long-term contracts.
"The stable outlook on Transact reflects our expectation that
despite its small niche scale, continued electronic payment
adoption, new customer wins, and increasing level on-campus
activities as more students return will lead to revenue growth in
the high-single-digits over the next year. We also expect the
company to maintain its current profitability, such that leverage
gradually decreases to the high-6x area by the end of the year with
annual FOCF of about $20 million."
A higher rating would require:
-- Continued revenue growth with a track record of increasing
market penetration and EBITDA margin expansion resulting in
leverage below 6x;
-- Sustained generation of positive free cash flows such that free
cash flow to debt ratio is in the mid to high single digit
percentage area; and
-- Low risk of re-leveraging the balance sheet for shareholder
dividends or acquisitions.
S&P said, "We could lower the rating if the company is unable to
maintain positive FOCF or leverage increases materially, such that
we consider its capital structure to be unsustainable. This could
occur if the company experiences major customer losses or a
deterioration in profitability through cost overruns. We could also
lower the rating if we envision potential risk of a financial
covenant breach."
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 RCP Vega Inc.'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."
REAL GRANITE: Unsecureds to Get Share of Income for 36 Months
-------------------------------------------------------------
Real Granite, Inc., filed with the U.S. Bankruptcy Court for the
Western District of Texas a Plan of Reorganization dated April 18,
2022.
The Debtor is a Texas corporation governed by the Article of
Incorporation of Real Granite, Inc., dated December 6, 1999.
The Debtor filed this case to preserve and maximize the value of
its assets and provide an appropriate repayment plan for the
benefit of all creditors and stakeholders. In this Plan, the Debtor
proposes to reorganize and pay existing debts from future income
generated from operations. The Debtor believes the terms of this
Plan will maximize distributions to the creditors of and interest
holders in the Debtor to emerge from bankruptcy with the ability to
meet future ongoing obligations.
Class 10 consists of the general unsecured creditors of the Estate.
The general unsecured claims are to be paid on a pro-rata basis for
the period of 36 months from the confirmation of the Plan based
upon the monthly disposable income, less a reasonable hold back for
capital items necessary for the Debtor's operations. The monthly
payments are to begin on the first day of the monthly following the
effective date of the Plan. The Class 10 creditors are impaired and
entitled to vote on the Plan.
Class 11 consists of Interest Holders. Holders of interests in the
Debtor will retain the same proportional interests in tge Debtor as
existed at the filing of the case. Roland Martinez is the President
and 100% owner of the Debtor. The Class 11 creditors is
unimpaired.
On the effective date, all assets of the Debtor will be vested in
the Reorganized Debtor. The assets will be vested in the
Reorganized Debtor free and clear of all Liens, Claims, rights,
Interests, and charges, except as expressly provided in this Plan.
The obligations under the Plan will be funded by the operation of
the Reorganized Debtor's business.
A full-text copy of the Plan of Reorganization dated April 18,
2022, is available at https://bit.ly/3v9BAtP from PacerMonitor.com
at no charge.
Attorneys for the Debtor:
David S. Gragg, Esq.
William R. Davis, Jr., Esq.
Langley & Banack, Inc.
745 E. Mulberry, Suite 700
San Antonio, TX 78212
Telephone: (210) 736-6600
Facsimile: (210) 735-6889
Email: wrdavis@langleybanack.com
About Real Granite Inc.
Real Granite, Inc., specializes in commercial tile and stone
installation, residential granite, marble and stone fabrication and
installation. The company is based in San Antonio, Texas.
Real Granite filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. W.D. Texas Case No. 22-50050) on
Jan. 18, 2022, listing $2,596,812 in assets and $2,843,279 in
liabilities. Roland Martinez, president of Real Granite, signed
the petition.
Judge Craig A. Gargotta presides over the case.
David S. Gragg, Esq., and William R. Davis Jr., Esq., at Langley &
Banack, Inc., serve as the Debtor's attorneys.
RECEPTION MEZZANINE: Fitch Assigns First-Time 'B+' IDR
------------------------------------------------------
Fitch Ratings has assigned a first-time 'B+' Issuer Default Rating
(IDR) to Reception Mezzanine Holdings, LLC dba STG Logistics, Inc
and Reception Purchaser, LLC. Fitch has also assigned a 'BB-'/'RR3'
issuance rating to Reception Purchaser, LLC's senior secured
revolver and term loan. The Rating Outlook is Stable.
KEY RATING DRIVERS
End Market Diversity & Market Leadership Positions: STG combines
the top U.S. warehouse network (28 facilities nationwide, serving
eight of the top 10 ports) with the #3 intermodal and drayage
provider. As a vertically integrated port-to-door servicer, it can
service regional and national accounts more effectively than its
smaller competitors.
Combining the STG and XPOI businesses captures some margin, which
had previously leaked to third parties. Further margin improvements
are expected to be driven by enhanced network effects. Revenue is
diversified by service (Drayage 40%, Rail 32%, Import/Export 11%,
Transportation 11%, Warehousing 6%) and end market
(Retail/E-Commerce 35%, Automotive 15%, Logistics & Transportation
15%, Industrial/Manufacturing 12%, remainder 24%).
Positive Industry Tailwinds: The acceleration of e-commerce and
supply chain changes are driving demand for import, export, and
warehousing services. Compared to trucking, intermodal freight
movement uses less fuel and fewer drivers, leading to significant
environmental and cost advantages. Global container volumes grew
9.3% in 2021 following a depressed 2020; the company expects growth
at a ~5% annual rate, twice as fast as U.S. real GDP growth.
Pricing power is supported by constraints in the supply chain, and
contracts that include cost-escalation mechanisms. After a
favorable pricing environment in 2021, and the first several months
of 2022, Fitch expects some moderation in the second half of 2022
and into 2023. Intermodal transport is more time consuming and less
flexible than truck-based JIT delivery, which could present a
headwind if present trends reverse.
Leveraged Capital Structure: The sponsors' relatively large equity
contribution somewhat moderates leverage, which Fitch expects to
fall from 4.0x at YE 2022 to the low-3x range over the next three
to four years. On a lease-adjusted basis, Fitch estimates YE 2022
leverage of 5.2x, declining to the high-4x range. Deleveraging is
driven mostly by EBITDA improvements, as well as some moderate debt
reduction from the ECF sweep.
Broad Customer Base: STG's customer base of 6,900 is well
diversified (T1 5%, T10 19%), with the top 10 averaging tenure of
20 years. Growth is driven by medium-term contracts with high
renewal rates (STG legacy 96%). Larger customers tend to favor
market leaders when evaluating transportation solutions, which
positions STG favorably amongst competitors in a relatively
fragmented industry. Prior STG management failed to implement a
pricing strategy in 2018; managing this aspect of the business will
continue to be a key focus for the new management team.
Asset-Light, Flexible Cost Structure: STG's largest costs are
partly variable, accounting for 45% of COGS. Labor accounts for 15%
of COGS, and fuel around 9%. STG's facilities are exclusively
leased, as is the majority of its fleet (1,980 of 2,000 truck
chassis; 9,050 of 11,000 53' containers; 2,850 of 3200 rail
chassis). Accordingly, Fitch expects capex spend to be modest at
around 1% of revenue annually. This structure allows the company to
scale appropriately in response to changes in the demand
environment, and also to preserve cash flow and margin during a
time of stress.
Integration Risk: While acknowledging the large size and
transformative nature of the XPOI acquisition, Fitch views
integration risk as moderate. The transaction is not predicated on
achievement of large synergies. The XPOI business will run largely
as a standalone entity, and key XPOI management will remain in
place in the combined business. STG's CEO is familiar with the XPOI
business, having served as COO of the predecessor business Pacer.
Both management and the sponsors have emphasized no M&A for at
least the first 12 months, and minimal focus on M&A after that
point. AlixPartners is advising on the integration. XPOI comes with
an agreement to use its existing customer and operational systems,
and a six-month TSA period is in place.
Degree of Resiliency Through Downturns: The legacy STG business
cycled down 11% in 2020 before rebounding 37% in 2021; XPOI
business cycled down 7% in 2020 before rebounding 33% in 2021.
While 2020 performance was affected in part due to depressed
volumes and supply chain constraints, these same constraints led to
pricing power in 2021 even as volume constraints remained. Fitch
expects the shift in consumer preferences towards e-commerce to
persist as the effects of the pandemic subside, while recognizing
fundamental shifts in global trade flows triggered by a downturn or
recession remain a risk for the company.
Adequate FCF & Liquidity: Fitch expects STG to generate FCF of
around $120 million-$140 million yearly, on FCF margins in the mid
to high single digit range. This cash flow is expected to
supplement liquidity, which is tight for the rating category at $20
million cash and $35 million revolver availability.
DERIVATION SUMMARY
STG's rating reflects the company's scale within the U.S. (#3
intermodal, #1 inland distribution), with diversification by
geography, end market, and customer. These strengths are balanced
by its leveraged financial structure, marginal liquidity, exposure
to labor and fuel cost inflation, dependence on global trade flows,
and degree of integration risk. Fitch expects STG's expanded
capabilities to better position the company within a highly
fragmented and competitive industry.
The company generates moderately strong cashflow from its
well-diversified long-term contracted relationships. Fitch expects
the company to focus primarily on integration for at least the
first 12 months-18 months post-close. Risk factors include the
relatively low margin nature of the business, limited track record
of operating as an integrated entity, and high degree of
competition from other service providers.
The logistics industry is highly fragmented, but it also has a
number of large dominant players such as FedEx, Detsche Post AG
(BBB+/Stable) and XPO Logistics, Inc. Relative to FedEx, Detsche
Post AG and XPO, STG's scale is considerably smaller and less
diversified. STG has similar profitability but has a more leveraged
financial profile than peers.
Compared to a mid-size peer GXO Logistics, Inc (BBB/Negative), STG
has smaller size, better profitability but higher leverage which
represents a weight on its rating.
KEY ASSUMPTIONS
-- Revenue growth in 2022 is driven by price increases at both
STG and XPOI, as well as volume improvements at STG and XPOI.
Growth to 2023 is expected to be flat, as the industry
processes several years of price increases and congestion at
ports alleviates. Beyond 2023, growth is estimated in line
with the medium-term industry growth rate projection. No M&A
activity is included in the projection;
-- Margins expansion in 2021 reflects the impact of price
increases; 2022 margins reflect continued pricing power, as
well as the partial achievement of synergies. Margins decline
in 2023 as synergy realization is more than offset by cost
inflation as supply chain congestion alleviates and the
pricing environment normalizes;
-- EBITDA increases in 2022 due to the merger, and then scales
with margins in the outer years of the forecast;
-- Capex is forecast to grow through the projection period from a
base of $13 million in line with revenue growth. Most capacity
increases to the container fleet are funded via leases;
-- Cashflow remains positive through the projection period, with
a Fitch-calculated FCF ranging from $120 million to $140
million in 2023 and beyond;
-- Fitch projects the cash balance to build through the
projection period, primarily a result of FCF generation. Fitch
expects some debt prepayment activity through the ECF
mechanism, as well as limited voluntary prepayments;
-- Fitch expects Total / Lease adjusted leverage to decline from
4.0x/5.2x at YE 2022 to 3.5x/4.9x at YE 2024.
The recovery analysis assumes that STG would be reorganized as a
going concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim.
Fitch estimates STG's GC EBITDA at $150 million. This reflects pro
forma adjustments for cash flows added via acquisitions. The GC
EBITDA estimate reflects Fitch's view of a sustainable,
post-reorganization EBITDA level, which is Fitch's basis for the
enterprise valuation. This estimate reflects a potential weakening
of the economy leading to disruption in the intermodal logistics
market and/or the loss of several significant customers. It also
reflects corrective measures taken in the reorganization to offset
the adverse conditions that triggered default, such as cost
cutting, contract repricing and industry recovery.
Fitch assumes STG would receive a GC recovery multiple of 4.0x in
this scenario. This multiple is applied to the GC EBITDA to
calculate a post-reorganization enterprise value (EV). Ultimately
STG's 4.0x multiple is driven by the company's size and scale and
by comparable EV valuations among logistics providers. It also
considers the 6.25x multiple underpinning the March/22 XPOI
acquisition.
Fitch's recovery scenario assumes STG's revolver is fully drawn.
These assumptions generate a 'BB-' rating, and an 'RR3' Recovery
Rating for the senior secured debt.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- A material increase in size, scale, and business model which
reduces cyclical risks to cashflow;
-- A sustained decrease in total adjusted debt/EBITDAR leverage
below 4.0x;
-- An increase in fixed charge coverage to 2.5x or greater.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A sustained increase in Total Adjusted Debt/EBITDAR leverage
above 5.0x;
-- A decrease in fixed charge coverage to 1.5x or lower;
-- Changes in the competitive environment which result in EBITDA
margins falling below 10%, or FCF margins falling below 5%.
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: At close, STG is expected to have $35 million
in revolver availability with a $20 million cash balance for
combined liquidity of $55 million. This represents less than 4% of
LTM revenue, which is low for the rating category. Liquidity will
be supported by positive free cash flow and low capex
requirements.
Debt Structure: The $60 million revolver and $725 million Term Loan
rank pari-passu and share in the same security.
ISSUER PROFILE
STG combines the #1 US inland distribution and warehouse network
(28 facilities nationwide, serving 8 of the top 10 ports) with the
#3 US intermodal and drayage service provider.
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. For more information on Fitch's ESG
Relevance Scores, visit www.fitchratings.com/esg.
DEBT RATING RECOVERY
---- ------ --------
Reception Mezzanine Holdings, LLC LT IDR B+ New Rating
Reception Purchaser, LLC LT IDR B+ New Rating
senior secured LT BB- New Rating RR3
RIVERBED HOLDINGS: Moody's Assigns 'Caa1' CFR, Outlook Negative
---------------------------------------------------------------
Moody's Investors Service assigned a Caa1 Corporate Family Rating
and Caa1-PD Probability of Default Rating to Riverbed Holdings,
Inc. ("Riverbed" or "the company"). Concurrently, Moody's assigned
a Caa1 debt instrument rating to Riverbed Technology LLC's (the
debt issuing and primary operating subsidiary of Riverbed Holdings,
Inc.) senior secured term loan.
The rating action follows Riverbed's emergence from Chapter 11
Bankruptcy on December 7, 2021. As part of the process, Riverbed
was recapitalized with a new term loan, preferred stock, and
additional cash to support the company's liquidity position. The
outlook for both Riverbed Holdings, Inc. and Riverbed Technology
LLC is negative.
RATINGS RATIONALE
Riverbed's Caa1 CFR reflects the high leverage, weak cash flow, and
challenges the company continues to face in reversing revenue
declines. Although Riverbed emerged from its Chapter 11
restructuring with a significantly reduced debt load, challenges
offsetting the declining WAN Optimization business remain. The
company retains a leading position in the WAN Optimization market
despite the upheaval in the corporate networking industry driven by
new software architectures. Riverbed also has a leading position in
the high growth network performance management software market as
well as a strong niche position in the fast growing application
performance management market. Although Riverbed has solid
positions in these markets, the company has significantly lagged
industry revenue growth rates.
Financial leverage for the fiscal year ended December 31, 2021, was
approximately 9x on a cash adjusted EBITDA basis, pro forma for
restructuring and transaction related charges (and around 12x
including restructuring charges). Over the next 12-18 months,
Moody's expects leverage to remain elevated due to constraints on
EBITDA growth and the paid- in-kind interest component of the term
loan.
Though WAN Optimization is still a critical function, demand has
declined at double digit levels as customers evaluate their
application acceleration needs as more applications and
infrastructure migrate to the cloud and SD-WAN ramps up as a
disruptive technology. Riverbed's application and network
monitoring product lines have the potential to offset the declines
in the legacy WAN Optimization lines, though the timing of any
stabilization of revenues remains uncertain. Without a
stabilization of overall revenues, it will be difficult for
Riverbed to support the current capital structure. Riverbed should
benefit from the shift to working remotely which has highlighted
the challenges of efficiently running and monitoring cloud and
on-premise applications outside of traditional network walls
without degradation in performance.
Riverbed's liquidity is adequate, but limited, based on $61 million
of cash and cash as of December 31, 2021 and Moody's expectations
that free cash flow will be breakeven-to-negative over the next
12-18 months. The company does not currently have a revolving
credit facility. Moody's trailing twelve month free cash flow as of
December 31, 2021 was estimated to be negative, pro forma for the
new capital structure and excluding Chapter 11 and related
expenses.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The negative outlook reflects the risk that revenue and EBITDA
declines will continue if network and application monitoring growth
does not offset WAN Optimization declines, and free cash flow
remains negative.
The ratings could be upgraded if Riverbed stabilizes revenue,
leverage declines to below 8x on a Cash Adjusted EBITDA basis, and
if the company is able to meaningfully improve liquidity including
obtaining a committed revolving credit facility. The ratings could
be downgraded if revenues continue to decline or if free cash flow
does not approach breakeven or better levels.
Similar to other software providers, Riverbed has low environmental
risk. Social risks are low to moderate, in line with the software
sector, mainly stemming from social issues linked to data security,
diversity in the workplace and access to highly skilled workers.
Riverbed is principally owned by a group of funds led by Apollo
Global Management and several other institutional investors which
comprised the November 2021 pre-bankruptcy lender group. Although
the new owners will likely focus on reviving growth and improving
the valuation of the business, Moody's expects leverage will remain
very elevated.
Assignments:
Issuer: Riverbed Holdings, Inc.
Corporate Family Rating, Assigned Caa1
Probability of Default Rating, Assigned Caa1-PD
Issuer: Riverbed Technology LLC
Gtd Senior Secured Term Loan, Assigned Caa1 (LGD4)
Outlook Actions:
Issuer: Riverbed Holdings, Inc.
Outlook, Assigned Negative
Issuer: Riverbed Technology LLC
Outlook, Assigned Negative
Headquartered in San Francisco, CA, Riverbed is a leading provider
of Wide Area Network (WAN) Optimization and performance and
application monitoring products and services. Riverbed is
principally owned by a group of institutional investors, with
Apollo Global Management holding a majority position through its
various managed funds. Revenues were approximately $575 million for
the year ended December 31, 2021.
The principal methodology used in these ratings was Software
Industry published in August 2018.
SALLY HOLDINGS: Moody's Upgrades CFR & Senior Secured Notes to Ba1
------------------------------------------------------------------
Moody's Investors Service upgraded the corporate family rating of
Sally Holdings LLC to Ba1 from Ba2 and its probability of default
rating to Ba1-PD from Ba2-PD. Concurrently, Moody's upgraded the
rating of the company's senior secured term loan to Baa3 from Ba1,
upgraded the rating of its senior secured notes to Ba1 from Ba2 and
upgraded the rating of its senior unsecured notes to Ba2 from Ba3.
The outlook is stable and the company's speculative grade liquidity
rating remains SGL-1.
"Governance is a key driver of the upgrade as the company's
financial strategies have been prudent reflected by its meaningful
debt repayment and very good liquidity", Moody's Vice President
Mickey Chadha stated. "Although we expect some volatility in
earnings due to unprecedented macro and inflationary pressures
putting stress on the company's core customer, Sally's overall
operating performance has been quite steady through past economic
cycles and credit metrics are expected to remain strong as
concentration in somewhat less discretionary hair products is a
positive in the long run", Chadha added.
Upgrades:
Issuer: Sally Holdings LLC
Corporate Family Rating, Upgraded to Ba1 from Ba2
Probability of Default Rating, Upgraded to Ba1-PD from Ba2-PD
Gtd Senior Secured Bank Credit Facility, Upgraded to Baa3 (LGD2)
from Ba1 (LGD2)
Gtd Senior Secured 2nd Lien Regular Bond/Debenture, Upgraded to
Ba1 (LGD3) from Ba2 (LGD3)
Gtd Senior Unsecured Regular Bond/Debenture, Upgraded to Ba2
(LGD5) from Ba3 (LGD5)
Outlook Actions:
Issuer: Sally Holdings LLC
Outlook, Remains Stable
RATINGS RATIONALE
Sally Holdings LLC's Ba1 corporate family rating reflects its good
market position in the professional beauty supply market, typically
steady performance through economic cycles, geographic diversity,
and strong merchandising focus which has historically benefitted
the company's margins. The rating also reflects Sally Holding's
improved credit metrics. Prior to the coronavirus pandemic Sally
had a history of maintaining high debt levels but during the
pandemic it shifted its focus to debt reduction. The company repaid
the $395 million it had drawn down under its revolver as an
abundance of caution during the peak of the pandemic and also
repaid over $400 million in additional debt including its $200
million 2023 senior notes and about $213 million of its outstanding
fixed rate term loan using its significant cash balances in fiscal
2021. Sally Holding's lower debt burden coupled with good operating
performance has resulted in debt/EBITDA improving to 2.7 times at
December 31, 2021 from 4.0 times at December 31, 2020. Moody's
expects leverage to increase modestly as inflationary and supply
chain issues could pressure topline and operating margins, but
still remain moderate at around 3.0 times in 2022. The rating is
constrained by a highly challenging business environment, the
company's relatively small scale and continued need to execute its
business transformation plans.
The stable outlook reflects Moody's expectation that credit metrics
will not deteriorate meaningfully from current levels and company
will continue to implement strategies to improve top line results.
The outlook takes into account that the company will maintain a
disciplined approach to shareholder returns and acquisitions.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
A ratings upgrade will require well articulated and clear financial
policies that support credit metrics and a capital structure
consistent with an investment grade rating, including a largely
unsecured capital structure. A higher rating would also require
very good liquidity with strong free cash flow generation,
consistent revenue growth and margin expansion, improving position
of its e-commerce business, and adjusted debt to EBITDA sustained
below 2.5 times and EBIT/interest sustained above 5.5 times.
Ratings could be downgraded if operating performance were to
sustainably weaken, financial policies were to become more
aggressive, or the company is unable to maintain at least good
liquidity. Specific metrics that could lead to a downgrade include
adjusted debt to EBITDA sustained above 3.5 times, or EBIT/interest
sustained below 3.5 times.
The principal methodology used in these ratings was Retail
published in November 2021.
Sally Beauty Holdings, Inc. is an international specialty retailer
and distributor of professional beauty supplies with revenues of
approximately $3.9 billion for the LTM period ended 12/31/21.
Through the Sally Beauty Supply and Beauty Systems Group
businesses, the Company sells and distributes through 4,893 stores,
including 133 franchised units, and has operations throughout the
United States, Puerto Rico, Canada, Mexico, Chile, Peru, the United
Kingdom, Ireland, Belgium, France, the Netherlands, Spain and
Germany.
SERVICE KING: Nears Out-Of-Court Deal to Ease Debt
--------------------------------------------------
Rachel Butt and Katherine Doherty of Bloomberg News reports that
Blackstone's Service King, suffering from rising costs and labor
shortages, is nearing an out-of-court deal to ease its debt load
ahead of a looming bond maturity, according to people with
knowledge of the situation.
The proposal calls for bondholders led by Clearlake Capital Group
to take control and inject around $100 million, said the people,
who asked not to be identified because the talks are private.
Clearlake, based in Santa Monica, California, and Service King's
majority owner, New York-based Blackstone Inc., declined to
comment.
About Service King Collision Repair
Service King Collision Repair -- https://www.serviceking.com/ -- is
a national automotive collision repair company operating in 24
states and the District of Columbia across the U.S. It was founded
in 1976 by Eddie Lennox in Dallas. The Carlyle Group purchased
majority ownership of Service King in 2012. After growing the
chain from 49 Texas locations to more than 175 locations in 20
states, it sold a majority stake to Blackstone in July 2014.
Carlyle has maintained a minority stake. In 2017, Bloomberg
reported that Blackstone and Carlyle explored a sale of the chain
for as much as $2 billion.
SIMPLY FIT: Unsecured Creditors to Split $40.2K over 60 Months
--------------------------------------------------------------
Simply Fit, LLC, filed with the U.S. Bankruptcy Court for the
Middle District of Florida an Amended Plan of Reorganization for
Small Business dated April 18, 2022.
The Debtor owns and operates an Anytime Fitness franchise gym in
Largo, Florida. The Debtor provides its members with 24-hour
access to its state-of-the-art fitness facilities and more than
4,700 additional locations worldwide, as well as optional fitness
consultants, team workouts, and personal training.
The Debtor opened its doors for the first time on March 6, 2020,
and was forced to shut down on March 20, 2020, due to the COVID
pandemic. The Debtor reopened in May 2020; however, revenue
generation has been a slow process because: (1) the Debtor is a
start-up; (2) many people were apprehensive to resume normal
operations post reopening; and (3) the plaza where the Debtor is
located is not fully occupied.
After evaluating alternatives, the Debtor determined that a
Subchapter V Chapter 11 filing would provide a venue in which to
effectively address its current debts and best serve the interests
of its creditors, customers, and employees. The Debtor will utilize
the Chapter 11 process to reorganize its business and make
distributions to creditors efficiently and effectively.
The Debtor's financial projections show that the Debtor will be
able to distribute projected disposable income to the holders of
allowed administrative, priority tax, secured, and unsecured
creditors. The Debtor anticipates that the Plan will be confirmed
in April of 2022, distributions to administrative and secured
creditors will begin on the Effective Date.
Payments to Class 4 unsecured creditors shall be made monthly
commencing in or about the 1st day of the month following the entry
of the Confirmation Order and ending on the 60th month following
the entry of the Confirmation Order. The Debtor projects that total
distributions to unsecured creditors will be approximately $40,200.
The distributions under the Plan will be derived from (i) existing
cash on hand on the Effective Date, (ii) revenues generated by
continued business operations; and (iii) net proceeds from the sale
of excess equipment.
This Plan of Reorganization proposes to pay creditors of Simply
Fit, LLC from its net disposable income.
Class 2 consists of the claim of United Community Bank ("UCB"),
which is secured by a lien on the majority of the Debtor's assets
as more particularly described in the loan documents and UCC-1
filing. UCB filed a secured claim, Claim No. 3, in the amount of
$31,263. For purposes of the Plan, the Debtor proposed to treat
UCB's claim as $175,263.00.15.
The Debtor shall make 60 monthly payments, due on the 15th of each
month, in an amount that is equal to the Aggregate Collateral Value
amortized over 15 years at 5.75 percent, in which the remainder
shall balloon on the last day of the 60th month. If the Aggregate
Collateral Value is the maximum amount permitted under the
respective mortgages and Equipment Collateral.
Class 3 consists of all non-priority unsecured claims. The Debtor
estimates that Class 11's claims will total approximately $40,200.
Every holder of a non-priority unsecured claim against the Debtor
shall receive its pro-rata share of the Debtor's projected
disposable income after payment of operating expenses, including
rent, and administrative, priority tax, secured claims, and all
payments due under the Plan. Payments shall be made monthly
commencing on the 15th day of the month following the entry of the
Confirmation Order and terminating on the 60th month following
entry of the Confirmation Order. The Debtor projects that total
distributions to unsecured creditors will be approximately
$40,200.00. Class 3 is impaired by the Plan.
Class 4 consists of all equity security interests in the Debtor.
Class 4 is comprised of all equity interests in the Debtor, which
are owned by Tyrone Joy (85%) and Mark Joy (15%). Tyrone Joy and
Mark Joy will retain their equity interests in the Debtor. No
distributions will be made to Tyrone Joy or Mark Joy until the
distributions to Class 3 have been made. Class 4 is unimpaired by
the Plan.
Payments required under the Plan will be funded from (i) existing
cash on hand on the Effective Date and (ii) revenues generated by
continued operations.
A full-text copy of the Amended Plan of Reorganization dated April
18, 2022, is available at https://bit.ly/39hQXrL from
PacerMonitor.com at no charge.
Attorneys for Debtor:
Mark F. Robens
Florida Bar No. 108910
Stichter Riedel Blain & Postler, P.A.
110 East Madison Street, Suite 200
Tampa, Florida 33602
Telephone: (813) 229-0144
Email: mrobens@srbp.com
About Simply Fit LLC
Simply Fit, LLC, filed a Chapter 11 bankruptcy petition (Bankr.
M.D. Fla. Case No. 21-04636) on Sept. 8, 2021, disclosing under $1
million in both assets and liabilities. The Debtor is represented
by STICHTER, RIEDEL, BLAIN & POSTLER, P.A.
SIX FLAGS: Egan-Jones Hikes Sr. Unsecured Debt Ratings to CCC+
--------------------------------------------------------------
Egan-Jones Ratings Company, on March 29, 2022, upgraded the foreign
currency and local currency senior unsecured ratings on debt issued
by Six Flags, Inc. to CCC+ from CCC-. EJR also upgraded the rating
on commercial paper issued by the Company to B from C.
Headquartered in Arlington, Texas, Six Flags, Inc. owns and
operates theme parks.
SM ENERGY: Egan-Jones Cuts Senior Unsecured Debt Ratings to B
-------------------------------------------------------------
Egan-Jones Ratings Company, on March 29, 2022, downgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by SM Energy Company to B from CCC+.
Headquartered in Denver, Colorado, SM Energy Company is an
independent energy company that explores for and produces natural
gas and crude oil.
SOUTHWESTERN ENERGY: Egan-Jones Hikes Sr. Unsecured Ratings to B
----------------------------------------------------------------
Egan-Jones Ratings Company, on March 30, 2022, upgraded the foreign
currency and local currency senior unsecured ratings on debt issued
by Southwestern Energy Company to B from B-.
Headquartered in Houston, Texas, Southwestern Energy Company is an
independent energy company.
TD SYNNEX: Egan-Jones Maintains BB+ Unsecured Debt Ratings
----------------------------------------------------------
Egan-Jones Ratings Company, on March 31, 2022, maintained its 'BB+'
foreign currency and local currency senior unsecured ratings on
debt issued by TD SYNNEX Corp.
Headquartered in Fremont, California, TD SYNNEX Corp provides
information technology supply chain services.
TEGNA INC: Egan-Jones Retains CCC+ Senior Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company, on March 31, 2022, maintained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by TEGNA Inc. EJR also maintained its 'B' rating on
commercial paper issued by the Company.
Headquartered in Tysons, Virginia, TEGNA Inc. is a broadcasting,
digital media and marketing services company.
TOYS "R" US: Creditors' Trust Can't Claw Back the $12 Mil. From UPS
-------------------------------------------------------------------
Matthew Santoni of Law360 reports that the trust representing
creditors for the Toys R Us bankruptcy estate can't claw back $12
million that the retailer had paid UPS, after a Virginia bankruptcy
judge ruled that the 2018 settlement wrapping up the chain's
operations had released avoidance claims against other creditors.
The creditors' trust had claimed that the settlement didn't apply
to UPS because it had gotten paid in full before the deal took
effect and that it hadn't suffered any loss in the bankruptcy, but
U. S. Bankruptcy Judge Keith L. Phillips held on Thursday that the
settlement release covered creditors past and present.
About Toys "R" Us
Toys "R" Us, Inc., was an American toy and juvenile-products
retailer founded in 1948 and headquartered in Wayne, New Jersey, in
the New York City metropolitan area. Merchandise was sold in 880
Toys "R" Us and Babies "R" Us stores in the United States, Puerto
Rico and Guam, and in more than 780 international stores and more
than 245 licensed stores in 37 countries and jurisdictions.
Merchandise was also sold at e-commerce sites including Toysrus.com
and Babiesrus.com.
On July 21, 2005, a consortium of Bain Capital Partners LLC,
Kohlberg Kravis Roberts, and Vornado Realty Trust invested $1.3
billion to complete a $6.6 billion leveraged buyout of the
company.
Toys "R" Us became a privately owned entity but still filed with
the U.S. Securities and Exchange Commission as required by its debt
agreements.
Toys "R" Us, Inc., and certain of its U.S. subsidiaries and its
Canadian subsidiary voluntarily filed for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Va. Lead Case No. Case No.
17-34665) on Sept. 19, 2017. In addition, the Company's Canadian
subsidiary voluntarily commenced parallel proceedings under the
Companies' Creditors Arrangement Act ("CCAA") in Canada in the
Ontario Superior Court of Justice. The Company's operations outside
of the U.S. and Canada, including its 255 licensed stores and joint
venture partnership in Asia, which are separate entities, were not
part of the Chapter 11 filing and CCAA proceedings.
The Company's consolidated balance sheet showed $6.572 billion in
assets, $7.891 billion in liabilities, and a stockholders' deficit
of $1.319 billion as of April 29, 2017.
Judge Keith L. Phillips presides over the Chapter 11 cases.
In the Chapter 11 cases, Kirkland & Ellis LLP and Kirkland & Ellis
International LLP serve as the Debtors' legal counsel. Kutak Rock
LLP serves as co-counsel. Toys "R" Us employed Alvarez & Marsal
North America, LLC as its restructuring advisor; and Lazard Freres
& Co. LLC as its investment banker. It hired Prime Clerk LLC as
claims and noticing agent. Consensus Advisory Services LLC and
Consensus Securities LLC, serve as sale process investment banker.
A&G Realty Partners, LLC, serves as its real estate advisor.
On Sept. 26, 2017, the U.S. Trustee for Region 4 appointed an
official committee of unsecured creditors. The Committee retained
Kramer Levin Naftalis & Frankel LLP as its legal counsel; Wolcott
Rivers, P.C., as local counsel; FTI Consulting, Inc., as financial
advisor; and Moelis & Company LLC as investment banker.
Grant Thornton is the monitor appointed in the CCAA case.
UNIENERGY TECHNOLOGIES: Mayer, HCMP Update on Committee Members
---------------------------------------------------------------
In the Chapter 11 cases of UniEnergy Technologies, LLC, the law
firms of Mayer Brown LLP and Hillis Clark Martin & Peterson P.S.
submitted a supplemental verified statement under Rule 2019 of the
Federal Rules of Bankruptcy Procedure, to disclose an updated list
of Ad Hoc Creditors' Committee members that they are representing.
The Ad Hoc Creditors' Committee was formed at the instance of
member Mahi Pai LLC, which contacted each current member and
inquired about its interest in forming a group to work together in
response to UniEnergy Technologies, LLC's failure to satisfy its
ordinary course debts and other contractual obligations.
Specifically, each member holds an unsecured claim against the
Debtor that remains unpaid; the collective amount of these claims
exceeds $700,000, as detailed further below. While individual
members of the Ad Hoc Creditors' Committee act independently, they
are united by a desire to see the Debtor satisfy its obligations
and unpaid debts, rather than evade them through a series of sham
transactions whereby the Debtor "went dark" without satisfying it
obligations to creditors and its assets were fraudulently
transferred to insiders, necessitating the filing of this Chapter
11 Case. Forever Energy Inc. also took a lead role in administering
the formation of the Ad Hoc Creditors' Committee and has agreed to
be responsible for the payment of most of the Ad Hoc Creditors'
Committee's expenses, including legal fees.
Five members of the Ad Hoc Creditors' Committee, Aggreko, LLC,
California Energy Storage Alliance, DAH Corporation d/b/a
ISOutsource, Mahi Pai LLC and Zephyr LLC, filed the involuntary
petition against the Debtor filed on October 14, 2021, initiating
the Chapter 11 Case. Farm ACW joined the petition on March 15,
2022.
The address and the nature and amount of each disclosable economic
interest of each member of the Ad Hoc Creditors' Committee as of
the date the Ad Hoc Creditors' Committee was formed is as follows:
a. Aggreko, LLC: 4607 West Admiral Doyle Drive, New Iberia,
LA 70650. Aggreko, LLC holds a claim for unpaid amounts
due in the amount of $146,370.51 as of October 14, 2021.
b. California Energy Storage Alliance: 2150 Allston Way,
Berkeley, CA 94704. CESA holds a claim for unpaid
membership fees in the amount of $14,500.00 as of October
14, 2021.
c. DAH Corporation d/b/a ISOutsource: 19119 North Creek
Parkway, Bothell, WA 98011. ISOutsource holds a claim for
unpaid IT products and services in the amount of
$16,364.53 as of October 14, 2021.
d. Farm ACW: 40147 Call Roxanne, Fallbrook, CA 92028. Farm
ACW holds a claim for unpaid amounts due in the amount of
$468,158.00.
e. Forever Energy Inc.: 10900 NE 4th Street, 23rd Floor,
Bellevue, WA 98004. Forever Energy Inc. holds a claim for
breach of contract, among other things, under a
prepetition assignment agreement in an unliquidated amount
as of October 14, 2021. Forever Energy Inc. also holds a
claim acquired from DHL Global Forwarding for unpaid
amounts due in the amount of $13,129.07.
f. Mahi Pai LLC: 818 5th Street, Kirkland, WA 98033. Mahi Pai
LLC holds a claim for unpaid consulting fees in the amount
of $47,338.42.
g. Zephyr LLC: 8360 NE Meadow Ridge Road, Pineville, OR
97754. Zephyr LLC holds a claim for unpaid consulting fees
in the amount of $35,178.86.
Each member of the Ad Hoc Creditors' Committee does not purport to
act, represent or speak on behalf of any creditor, party in
interest or any other entity in connection with the Chapter 11 Case
other than itself.
The members of the Ad Hoc Creditors' Committee each retained common
counsel to represent them in this Chapter 11 Case, Mayer Brown LLP
and Hillis Clark Martin & Peterson P.S.
The Ad Hoc Creditors' Committee reserves the right to supplement
and amend this statement, as necessary, and as required under FRBP
2019(d).
Counsel to the Ad Hoc Creditors' Committee can be reached at:
MAYER BROWN LLP
Douglas Spelfogel, Esq.
Derek Wright, Esq.
1221 Avenue of the Americas
New York, NY 10020
Telephone: (212) 506-2500
E-mail: dspelfogel@mayerbrown.com
dwright@mayerbrown.com
- and -
HILLIS CLARK MARTIN & PETERSON P.S.
Bradley R. Duncan, Esq.
Amit D. Ranade, Esq.
999 Third Avenue, Suite 4600
Seattle, WA 98104
Tel: (206) 623-1745
E-mail: bradley.duncan@hcmp.com
amit.ranade@hcmp.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/3KcbtGR
About UniEnergy Technologies
UniEnergy Technologies, LLC, manufactures megawatt-scale energy
storage systems for utility, commercial, and industrial customers.
UniEnergy Technologies was subject to an involuntary Chapter 11
bankruptcy petition (Bankr. W.D. Wash. Case No. 21-11903-CMA) filed
on Oct. 14, 2021. The alleged creditors who signed the petition
are Aggreko, LLC, California Energy Storage Alliance, DAH
Corporation, Mahi Pai LLC, and Zephyr LLC.
HILLIS CLARK MARTIN & PETERSON P.S., led by Bradley R. Duncan, and
Douglas E. Spelfogel, serve as counsel to the petitioners.
US AIRWAYS: Customers to Appeal Bankruptcy Merger Row to 2nd Cir.
-----------------------------------------------------------------
Vince Sullivan of Law360 reports that a group of airline customers
signaled Thursday, April 21, 2022, their intention to appeal a New
York federal judge's ruling upholding a 2013 merger between
American Airlines and US Airways up to the Second Circuit Court of
Appeals, extending the long-running antitrust battle that arose
from American's bankruptcy.
The plaintiffs group -- consisting of travel agents and direct
purchasers of airline tickets from the two airlines -- filed a
notice of appeal of the New York district court's order from last
month that upheld a 2019 bankruptcy court decision approving the
merger.
About US Airways
US Airways -- http://www.usairways.com/-- along with US Airways
Shuttle and US Airways Express, operates more than 3,000 flights
per day and serves more than 190 communities in the U.S., Canada,
Mexico, Europe, the Middle East, the Caribbean, Central and South
America.
Under a Chapter 11 plan declared effective on March 31, 2003, USAir
emerged from bankruptcy with the Retirement Systems of Alabama
taking a 40% equity stake in the deleveraged carrier in exchange
for $240 million infusion of new capital.
US Airways and its subsidiaries filed another Chapter 11 petition
(Bankr. E.D. Va. Case No. 04-13820) on Sept. 12, 2004. Brian P.
Leitch, Esq., Daniel M. Lewis, Esq., and Michael J. Canning, Esq.,
at Arnold & Porter LLP, and Lawrence E. Rifken, Esq., and Douglas
M. Foley, Esq., at McGuireWoods LLP, represented the Debtors in
their restructuring efforts. The USAir II bankruptcy plan became
effective on September 27, 2005. The Debtors completed their merger
with America West on the same date.
VENCHUR INVESTMENTS: Wins Cash Collateral Access Thru June 2
------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Orlando Division, authorized Venchur Investments, LLC to:
-- use cash collateral on an interim basis in accordance with
the budget through June 2, 2022, and
-- provide adequate protection to Celtic Bank Corporation and,
to the extent necessary, Supersonic Funding.
The Debtor is permitted to pay amounts expressly authorized by the
Court, including payments to the U.S. Trustee for quarterly fees,
the current and necessary expenses set forth in the budget, and
additional amounts as may be expressly approved in writing by
Celtic Bank.
Celtic Bank and Supersonic will have a perfected post-petition lien
against the cash collateral to the same extent and with the same
validity and priority as the pre-petition lien, without the need to
file or execute any documents as may otherwise be required under
applicable non-bankruptcy law.
The Debtor will also maintain insurance coverage for its property
in accordance with the obligations under the loan and security
documents with Secured Creditors.
A continued preliminary hearing on the matter is scheduled for June
2 at 1:30 p.m.
A copy of the order and the Debtor's budget for the period from
March to August 2022 is available for free at
https://bit.ly/3L9svqq from PacerMonitor.com.
The Debtor projects $265,000 in gross sales and $140,200 in total
operating expenses for the period.
About Venchur Investments, LLC
Venchur Investments, LLC operates a restaurant, bar, and event
space at its principal location at premises located at 3231
Edgewater Drive, Orlando, Florida 32804.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 6:22-bk-00539) on
February 15, 2022. In the petition signed by Pasquale Semeraro,
managing member, the Debtor disclosed up to $50,000 in assets and
up to $500,000 in liabilities.
Judge Grace Robson oversees the case.
Jeffrey S. Ainsworth, Esq., at BransonLaw, PLLC, represents the
Debtor as counsel.
VERACODE INC: Fitch Lowers Rating on $815MM First Lien Loan to B+
-----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings of
'B' for Mitnick Parent, L.P. and Mitnick Corporate Purchaser, Inc.
(collectively dba Veracode, Inc.). The Rating Outlook is Stable.
Fitch has upgraded Veracode's $75 million super-priority secured
revolving credit facility (RCF) to 'BB'/'RR1' from 'BB-'/'RR2'.
Fitch has also downgraded the upsized $815 million first-lien
secured term loan to 'B+'/'RR3' from 'BB-'/'RR2'. Mitnick Corporate
Purchaser, Inc. is the issuer of the 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. The rating actions
reflect the change in capital structure elevating the revolver to
super senior and the elimination of second-lien debt.
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.
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 fire
walls 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+/Negative).
Veracode has smaller revenue scale and lower EBITDA margins than
NortonLifeLock. 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:
-- Organic revenue growth in the high-single-digits;
-- EBITDA margins stable in the 30s;
-- Capex intensity remaining at approximately 3% of revenue;
-- Debt repayment limited to mandatory amortization;
-- Aggregate acquisitions of $100 million through FY 2026.
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 FY 2022 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 enterprise value (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 'RR3' 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 super senior 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 $815 million of secured first-lien
debt due 2029. 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 over
applications 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.
DEBT RATING RECOVERY PRIOR
---- ------ --------- -----
Mitnick Corporate Purchaser, Inc. LT IDRB Affirmed B
super senior LT BB Upgrade RR1 BB-
senior secured LT B+ Downgrade RR3 BB-
Mitnick Parent, L.P. LT IDRB Affirmed B
VERACODE: Moody's Lowers New Sr. Secured Term Loan to B3
--------------------------------------------------------
Moody's Investors Service downgraded Mitnick Corporate Purchaser,
Inc.'s (dba Veracode) proposed senior secured term loan to B3 from
B2. At the same time, Moody's upgraded the proposed super-priority
revolver to Ba3 from B2. All other ratings remain unchanged,
including the B3 Corporate Family Rating and B3-PD Probability of
Default Rating. The outlook remains stable.
The downgrade of the senior secured term loan reflects the change
in the capital structure with the senior secured term loan
increased to $815 million from $580 million, representing the
majority of the capital structure as the initially proposed second
lien term loan (unrated) is being eliminated. The upgrade of the
$75 million super-priority revolver reflects its relatively modest
size and most senior position in the capital structure, ahead of
the term loan. The ratings are subject to the receipt and review of
final documentation.
Upgrades:
Issuer: Mitnick Corporate Purchaser, Inc.
Gtd Senior Secured Super Priority Revolving Credit Facility,
Upgraded to Ba3 (LGD1) from B2 (LGD3)
Downgrades:
Issuer: Mitnick Corporate Purchaser, Inc.
Gtd Senior Secured Term Loan, Downgraded to B3 (LGD4) from B2
(LGD3)
RATINGS RATIONALE
Veracode's B3 CFR reflects the company's high pro-forma leverage of
around 8x debt/cash EBITDA (Moody's adjusted, including the change
in deferred revenue and stock based compensation, and the expensing
of capitalized sales commissions and software development costs),
small business scale, and exposure to the fragmented and highly
competitive application security market. Moody's anticipates that
Veracode's private equity owner will pursue aggressive financial
policies, a key ESG consideration, that will sustain high leverage
levels. Moody's also expects that Veracode will be looking to
expand its product portfolio through M&A and seek out consolidation
opportunities that result in elevated integration risks and
increased debt levels.
The rating is supported by Veracode's leading position in the
application security market and its comprehensive portfolio of
application security testing services. The company benefits from
strong organic growth potential driven by secular factors, such as
the increasing number of enterprise applications and rising
cybersecurity concerns. However, Moody's expects that given
Veracode's focus on profitable growth, overall revenue growth will
be in the high single to low teens percentage range over the next
12-18 months, slower than the double digit rate growth over the
last 3 years. The majority of the company's revenue is generated on
a recurring SaaS and subscription basis, which coupled with solid
gross retention rates provide good revenue and cash flow
predictability.
Veracode's liquidity is expected to be good, supported by $20
million of cash at the close of the transaction, full availability
under the proposed $75 million revolver, and Moody's expectation
for $40 - $45 million of free cash flow over the next 12 months.
Veracode's cash flow exhibits some seasonality as a significant
portion of company's renewals occur in December and March quarters
(fiscal Q3 and Q4, respectively). Capital expenditures are modest
while the annual term loan amortization is $8.15 million. The
proposed revolver is expected to contain a maximum first lien net
leverage ratio financial covenant set at 12.5x, which springs at
40% utilization.
The stable outlook reflects Moody's expectation for organic revenue
and earnings growth in the high single to low teens digit
percentage range over the next 12-18 months, with leverage
declining to around 7x debt/cash EBITDA and free cash flow to debt
in the mid-single digit range.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Veracode continues to grow revenue
organically and maintains more conservative financial policy with
leverage sustained below 7x debt/cash EBITDA and free cash flow to
debt exceeding 5%.
The ratings could be downgraded if revenue or EBITDA decline,
liquidity weakens or free cash flow is expected to be negative on
other than a temporary basis.
The principal methodology used in these ratings was Software
Industry published in August 2018.
Headquartered in Burlington, MA, Veracode is a global provider of
application security software and services. The company offers
solutions across static, dynamic, software composition and
interactive testing, serving over 2,600 customers across a wide
range of industries. Veracode is being acquired by TA Associates
from Thoma Bravo for a total purchase price of $2.5 billion. For
the LTM period ended December 31, 2021 the company generated $272
million of revenue.
VERMILION ENERGY: Fitch Gives 'BB-' Rating to $400MM Unsec. Notes
-----------------------------------------------------------------
Fitch Ratings has assigned 'BB-'/'RR4' ratings to Vermilion Energy
Inc.'s USD400 million senior unsecured note offering maturing May
2030. Net proceeds from the offering, expected to be approximately
CAD494 million, will be used to partially repay drawings on the
company's revolver. Upon issuance of the notes, the commitment
level of Vermilion's revolving credit facility is decreasing from
CAD2.1 billion to CAD1.6 billion, and the facility's maturity is
being extended to 2026 from 2024.
Vermilion's ratings reflect the diversification of its asset base,
exposure to higher priced European oil and gas indices compared to
North American peers, related FCF forecast and a track record of
defending its credit profile. The ratings also consider the
company' smaller production size for its rating category and lack
of scale in most plays outside of North America.
KEY RATING DRIVERS
Reducing Absolute Revolver Draw: Vermilion's revolver draw was
reduced from CAD1.555 billion at YE 2020 to CAD1.273 billion at YE
2021. Excluding FCF generation year to date, cash from the CAD494
net proceeds from Vermilion's USD400 million eight-year senior
unsecured notes will approximately offset the CAD477 million cash
purchase price of Vermilion's Leucrotta acquisition, with both
expected to close in 2Q22. Under Fitch's base case, 2022 FCF is
expected to approach the approximately CAD1 billion cash component
costs for Vermilion's Corrib and Leucrotta acquisitions, providing
visibility on net revolver reduction from the senior unsecured
proceeds, with further upside at strip pricing.
Vermilion has some risk mitigation to a higher revolver balance,
including being a non-borrowing base loan, which eliminates the
risk of redeterminations and the lack of springing liens.
Vermilion's level of revolver reliance has historically been
atypical for an E&P company, and application of the issuances
proceeds to revolver debt helps reduce this.
European Pricing Exposure: Proforma the Corrib and Leucrotta
acquisitions, Vermilion's European gas and Brent oil exposure will
be approximately 38% of total production. Price advantaged oil and
gas exposure, including record European natural gas prices relating
to geopolitical turmoil in Europe, support Vermilion's historically
strong cash netbacks, which are a credit differentiator compared to
similar gas-to-oil weighted North American E&P producers. FCF
benefits from current gas price exposure in Europe should provide
Vermilion with an opportunity to expediate its debt reduction
goals.
Trending Up Headroom: Strong EBITDA results during 2021, and the
rolling off of more heavily pandemic-impacted results during 2020,
have materially improved headroom under both Vermilion's total and
senior debt to EBITDA covenants by over two EBITDA turns for each.
At YE 2021, Vermilion's 4x total debt to EBITDA covenant had
improved to 1.61x from 3.48x at YE 2020, relieving all covenant
tightness. Further leverage reduction is expected through forecast
EBITDA growth, and from Vermilion's plans to apply FCF towards debt
reduction with a target of CAD1.2 billion net debt before any
further share buybacks or dividend increases.
Diversified Asset Base: Vermilion has a unique asset profile among
peers given the high level of geographic diversification relative
to its size. Its asset base is focused on three main regions: North
America, Europe and Australia. 2021 production is split between
Canada (61%), France (10%), the Netherlands (9%), Ireland (6%), the
U.S. (6%), Australia (4%), Germany (4%), and the remainder in
Central and Eastern Europe.
International weighting is expected to increase in 2022, supported
by the acquisition of an additional 36.5% of Corrib interest in
Ireland, which increases Vermilion's operating interest to 56.5%,
before falling modestly in 2023, once the expected Leucrotta
acquisition's assets production increases to 13Mboepd.
Vermilion's geographic diversification is linked to the company's
philosophy of seeking the highest return projects regardless of
location. Geologically, many of the plays tend to be shallow, lower
cost conventional resource plays (France, Netherlands) or lower
cost fracking plays (Williston Basin in Southeast Saskatchewan).
Challenges to Scaling Up: A downside of Vermilion's heavily
diversified portfolio is a limited ability to organically scale up
in most of its plays outside of North America properties. Growth
prospects for its international portfolio vary significantly,
ranging from regions in decline such as Corrib Ireland, to areas
with good geology and well perspectivity, but challenging
permitting environments (Germany and Netherlands).
The Leucrotta acquisition provides additional North American growth
prospects, as Vermilion expects to increase this asset's production
to 28Mboepd over the next few years. 2022 midpoint guidance of
87Mboepd is at the bottom end of the general 'BB' rating range,
where production typically ranges between 75Mboepd-175Mboepd.
Hedging Program: Vermilion targets 25%-50% hedging over a rolling
four quarters with natural gas hedged more than oil. For 2022,
around 55% of European natural gas, 30% of North American natural
gas, and 30% of projected oil production is hedged with
approximately 10% of 2023 projected production also hedged.
Vermilion's hedge program is generally unchanged from prior years,
in contrast to some E&P companies that have reduced hedging
practices. Additionally, current commodity prices have allowed
Vermilion to enter into hedges that lock in meaningful unit
profits.
DERIVATION SUMMARY
Vermilion's positioning against high-yield oil and gas peers is
mixed. In terms of geographic diversification, it is peer-leading
with operations in North America, Europe and Australia. However,
overall production size is on the low end of the 'BB-' level, with
only Vermilion's Canadian operations of 52Mboepd in 2021
contributing to meaningful scale. At a 4Q21 average of 84.4Mboepd,
Vermilion is smaller than 'BB-' rated E&P peer Civitas Resources
(BB-/Stable) at 153.5Mboepd. Vermilion's size is more in line with
Canadian peers Baytex Energy (B+/Stable) and MEG Energy
(B+/Stable), which averaged 80.8Mboepd and 100.1Mboepd in 4Q21,
respectively.
Vermilion's unit economics are positioned well against Canadian
peers, including those with a higher liquid weighting, due to
Vermilion's exposure to Brent-linked premiums for international
oil, as well as higher international pricing for natural gas. For
2021, Vermilion had a 55% liquids weighting and generated an
unhedged cash netback of USD32.5/bbl. This compares to Baytex (81%
liquids) and MEG (100% liquids), which had unhedged cash netbacks
of USD25.1 and USD23.2, respectively. Compared to 'B+' rated
Matador Resources, Vermilions' netbacks trail 'B+' rated Matador
Resources' USD38.9 due to Matador's positioning in the oil-weighted
Permian.
KEY ASSUMPTIONS
-- WTI (USD/bbl) of $95 in 2022, $76 in 2023, $57 in 2024, and
$50 in 2025 and longer term;
-- Henry Hub natural gas (USD/mcf) of $4.25 in 2021, $3.25 in
2023, $2.75 in 2024, and $2.50 in 2024 and longer term;
-- TTF/mcf natural gas of USD20 in 2022, USD10 in 2023, USD7 in
2024 and USD5 in 2025 and longer term;
-- Production increases to approximately 100Mboepd in 2023
inclusive of Leucrotta, increasing by high single digits
annually in 2024 and 2025;
-- Excess cash is applied to revolving credit facility/credit
facility funds cash requirements;
-- Shareholder dividend increase once debt targets achieved;
-- Leucrotta acquisition net cash purchase price of CAD477
million and USD400 million (net proceeds of approximately
CAD494 million) close in 2Q22.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Production approaching 150Mboepd;
-- Increased scale in existing positions, with greater drilling
inventory, a higher reserve life and the ability to develop
new inventory while maintaining high margins;
-- Improved financial flexibility;
-- Mid-cycle debt/EBITDA below 2.0x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Loss of operational momentum with organic production trending
below 70Mboepd or materially increasing production costs.
-- Impaired financial flexibility;
-- Mid-cycle debt/EBITDA above 3.0x;
-- Deviation from a financial policy that emphasizes debt
reduction before Vermilion's stated targets are met.
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
Extending and Reducing Revolver: Contingent on the success of
Vermilion's USD400 million notes offering maturing 2030, the
commitment level on its revolving credit facility will be reduced
from CAD2.1 billion to CAD1.6 billion. At YE 2021 Vermilion's
revolving facility was CAD1.274 billion. Proforma the approximately
CAD494 million proceeds from the USD400 million senior unsecured
issuance this results in a CAD780 million draw and a 49%
utilization rate.
In May 2022, Vermilion is expected to close on its Leucrotta
acquisition for cash consideration of CAD477 million, which
Vermilion expects to fund with 2022 FCF. Additionally, in 2H22 the
Corrib acquisition is closing for consideration of approximately
CAD600 million. Under Fitch's Base Case, FCF in 2022 nearly covers
the cash purchase prices of these acquisitions.
Vermilion's credit facility maturity will be extended from 2024 to
2026 upon closing of its USD400 million issuance, at which point
its first maturity is its 5.625% notes due in 2025.
Vermilion has re-introduced a quarterly $0.06/share dividend after
cancelling its dividend in 2020 to conserve liquidity. This
dividend is modest in relation to forecast FCF generation, and
along with potential share buybacks or a special dividend, may be
increased once the company's CAD1.2 billion net debt target is
met.
ISSUER PROFILE
Vermilion Energy Inc. (NYSE/TSE: VET) is a small-to-medium sized
diversified international E&P company with producing properties
primarily in North America, Europe, and Australia. Total production
averaged 85,408 boepd during 2021 with the largest amount of
production in Canada.
ESG CONSIDERATIONS
Vermilion Energy Inc. has an ESG Relevance Score of '4' for
Exposure to Social Impacts due to Vermilion's small-to medium-sized
production profile, offshore production, and operations in Europe
where there exists a more stringent climate-related regulatory
framework and increase social resistance. This has a negative
impact on the credit profile and is relevant to the ratings in
conjunction with other factors.
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.
VERMILION ENERGY: Moody's Rates New Senior Unsecured Notes 'B3'
---------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Vermilion Energy
Inc.'s proposed issuance of senior unsecured notes. The company's
existing ratings, including its B1 corporate family rating, were
not affected by this offering and the outlook remains stable.
"The notes issuance will repay revolver borrowings that will
increase following the C$477 million net cash acquisition of
Leucrotta, a Montney focused oil & gas producer," commented Paresh
Chari Moody's analyst. "Vermilion will generate significant free
cash flow in 2022, which will be directed to further reducing
revolver borrowings modestly lowering debt levels from 2021."
Assignments:
Issuer: Vermilion Energy Inc.
Senior Unsecured Regular Bond/Debenture, Assigned B3 (LGD5)
LGD Adjustment:
Issuer: Vermilion Energy Inc.
LGD Senior Unsecured Regular Bond/Debenture, Adjusted to (LGD5)
from (LGD6)
RATINGS RATIONALE
In accordance with Moody's Loss Given Default (LGD) for
Speculative-Grade Companies Methodology, the senior unsecured notes
are rated B3, two notches below the B1 CFR. This two notch
difference from the CFR reflects the C$1.6 billion secured
revolving credit facility that ranks ahead of Vermilion's unsecured
notes in its capital structure.
Vermilion's CFR is challenged by: 1) increasing production costs
that results in a higher breakeven price and reduces portfolio
durability; 2) regulatory pressure on oil and gas extraction
throughout Europe where a material portion of the company's assets
are located; and 3) a relatively small production and reserves base
compared to B1 and Ba3 peers. The rating is supported by: 1)
exposure to strong international commodity prices that will
increase to over one-third of total production by the purchase of
additional working interest in Corrib (increasing Vermilion's
interest to 56.5%); 2) a diversified portfolio of assets with low
decline rates that reduces capital intensity; and 3) good
liquidity, supported by Moody's expectation under Moody's medium
term price assumptions (US$50 to US$70/bbl oil) that Vermilion will
generate material free cash flow in 2022 which it will mostly use
to fund acquisitions.
Vermilion has good liquidity (SGL-2). Pro forma for the new notes
issuance and Leucrotta close, we expect minimal cash and about
C$500 million available under its C$1.6 billion revolving credit
facility which matures in May 2026. Moody's expects free cash flow
of around C$1 billion through mid-2023. The company will need to
fund the US$434 million Corrib acquisition in the second half of
2022 and use existing liquidity. The company has no upcoming debt
maturities. Moody's expects Vermilion will remain in compliance
with the three financial covenants under its revolving credit
facility over the next 12 months. Alternate sources of liquidity,
if needed, are good as the company could sell up to C$210 million
worth of assets without needing consent from its banks.
The stable outlook reflects Moody's view that Vermilion's 2022 debt
balances will remain largely stable and that it will maintain good
liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The ratings could be upgraded if production grows organically,
while RCF/debt is sustained above 35% and the leveraged full-cycle
ratio is above 1.5x.
The ratings could be downgraded if production declines, RCF/debt is
sustained below 20%, if the leveraged full-cycle ratio is sustained
below 1x under a worsening cost structure, or liquidity
deteriorates.
Vermilion is a Canadian independent exploration and production
company that operates a range of onshore and offshore light oil and
natural gas assets.
The principal methodology used in this rating was Independent
Exploration and Production published in August 2021.
VISTA GLOBAL: S&P Affirms B+ Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' issuer credit rating on
private jet operator Vista Global Holding Ltd. and 'B-' issue
ratings on its existing senior unsecured notes. S&P also assigned
its 'B-' issue rating to Vista Global's proposed five-year senior
unsecured notes.
S&P said, "The stable outlook reflects our expectation that Vista
Global's EBITDA expansion will offset its debt increase so that its
S&P Global Ratings-adjusted funds from operations (FFO) to debt
will sustainably improve to above 12% over the next 12 months,
while operating cash flow generation remains sufficient to cover
debt service and maintenance capital expenditure (capex).
"We expect that Vista Global's credit metrics will be only
moderately weaker than we previously forecast after the partially
debt-funded acquisitions. Vista Global plans to fund both
acquisitions with a combination of its own liquidity and $500
million of new unsecured notes. The company expects to close both
acquisitions in second-quarter 2022. When reflecting additional
debt assumed related to aircraft debt, operating leases, and
deferred purchase consideration from both acquisitions, we assume
that Vista Global's S&P Global Ratings-adjusted debt will increase
to about $3.9 billion in 2022, compared with our previous (January
2022) forecast of about $2.5 billion. That said, we assume that the
acquired companies will contribute about $250 million of EBITDA on
a pro forma basis in 2022, meaning we now forecast pro forma
adjusted EBITDA of $700 million-$750 million for Vista Global in
2022, up from our January 2022 forecast of $450 million-$500
million. According to our base case, Vista Global's adjusted
debt-to-EBITDA ratio will be toward the higher end of the 5.0x-5.5x
range in 2022, slightly weaker than our previous forecast of close
to 5.0x. We also forecast that its adjusted FFO to debt, which is
impacted by higher cash interest payments from the increase in
debt, will be 13%-14% in 2022, slightly lower than our previous
base case of 14%-15%. Based on our assumption that demand prospects
for private aviation will remain strong, we forecast that Vista
Global's adjusted leverage could subsequently reduce to below 5.0x
in 2023 and its adjusted FFO to debt could rise to about 16%,
though this will also depend on its financial policy regarding
growth capex and potential further complementary acquisitions."
The acquisitions support Vista Global's competitive position,
growth strategy, and service offerings. The acquisitions of Air
Hamburg, a Europe- and Middle East-focused private jet operator,
and Jet Edge, a U.S.-focused private jet operator, will strengthen
Vista Global's position as one of the largest operators in the
highly fragmented global private aviation market. Vista Global will
gain 44 aircraft from Air Hamburg and at least 41 aircraft from Jet
Edge, leading to a significantly larger total fleet of
approximately 250 aircraft. The additional fleet capacity also
allows the company to fulfill already secured demand from its
existing VistaJet and XO International customers, enabling it to
sustain its strong growth trajectory. In this context, there is a
significant opportunity for Vista Global to convert the mostly
wholesale revenue that Air Hamburg and Jet Edge generate from other
jet operators and brokers into higher yielding retail revenue from
its Vista Global membership program and on-demand clients. The
acquisitions also provide Vista Global with in-house aircraft
maintenance capabilities.
S&P said, "We expect Vista Global will maintain sound liquidity.
While Vista Global's available cash will reduce after the funding
of acquisitions, we expect this temporary dilutive impact on its
available liquidity will be partly offset by additional
availability on its larger undrawn revolving credit facility (RCF)
and additional FFO from the acquired companies. We estimate pro
forma liquidity sources to uses higher than 2.5x for the 12 months
from March 31, 2022. We note that Vista's absolute yearly lease
repayments remain material at about $300 million-$350 million
including repayments for Air Hamburg.
"The stable outlook reflects our expectation that Vista Global's
EBITDA expansion will offset its debt increase so that its adjusted
FFO to debt will sustainably improve to above 12% over the next 12
months, while operating cash flow generation remains sufficient to
cover debt service and maintenance capex."
Downside scenario
S&P said, "We could lower our rating if the group's EBITDA
significantly lags our base case and, in particular, does not
increase sufficiently to offset the expected debt increase, such
that adjusted FFO to debt remains below 12% or liquidity weakens.
This could occur if fleet utilization deteriorates sharply or
yields soften, resulting in weaker-than-expected cash flow that is
insufficient to cover annual finance lease repayments. This could
also result from the group not adjusting its fleet expansion should
EBITDA growth fall short of our projections, or from a more
aggressive financial policy than expected."
Upside scenario
S&P said, "We could raise the ratings if Vista Global's EBITDA
significantly increases, leading to adjusted FFO to debt
sustainably improving to over 16%, and the group continues to
generate positive free cash flow after making financial lease
repayments. This could occur if the customer base and plane
utilization rates expand substantially more than expected and the
group maintains a conservative financial policy and applies
discipline to capex, acquisitions, and shareholder returns."
ESG credit indicators: E-3, S-3, G-2
VOLUNTEER ENERGY: Seeks to Hire GlassRatner as Financial Advisor
----------------------------------------------------------------
Volunteer Energy Services, Inc. seeks approval from the U.S.
Bankruptcy Court for the Southern District of Ohio to hire
GlassRatner Advisory & Capital Group, LLC as its financial
advisor.
The firm's services include:
a. reviewing the Debtor's strategic options;
b. assisting the Debtor in developing financial projections,
liquidity projections, cash management and related reporting;
c. negotiating with various stakeholders;
d. implementing potential operational or strategic
enhancements;
e. assisting the Debtor with first-day order data collection;
f. assisting the Debtor with financial reporting;
g. assisting the Debtor in complying with the statutory
reporting requirements, including statements of financial affairs,
bankruptcy schedules and monthly operating reports;
h. assisting in the preparation of reports for, and
communications with, the court, creditors and any other
constituents;
i. reviewing, evaluating and analyzing the financial
ramifications of proposed transactions for which the Debtor may
seek court approval;
j. providing financial advice to the Debtor in connection with
a sale transaction;
k. assisting the Debtor in developing and supporting a
proposed plan of reorganization;
l. rendering testimony; and
m. any other duty or task which falls within the customary
responsibilities of a financial advisor.
The firm will charge these hourly fees:
Tom Buck Senior, Managing Director $695
Other Staff $225 ‒ $695
As disclosed in court filings, GlassRatner is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Tom Buck
GlassRatner Advisory & Capital Group, LLC
dba B. Riley Advisory Services
200 Vesey Street, 25th Floor
New York, NY 10281
Phone: (212) 457-3322
Email: tbuck@brileyfin.com
About Volunteer Energy Services
Volunteer Energy Services, Inc., an electric power provider based
in Pickerington, Ohio, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Ohio Case No. 22-50804) on March 25,
2022. In the petition signed by David Warner, chief financial
officer, the Debtor disclosed up to $100 million in both assets and
liabilities.
Judge C. Kathryn Preston oversees the case.
McDermott Will & Emery, LLP and Isaac Wiles and Burkholder, LLC
serve as the Debtor's lead bankruptcy counsel and local counsel,
respectively. GlassRatner Advisory & Capital Group, LLC, doing
business as B. Riley Advisory Services, is the Debtor's financial
advisor.
VOLUNTEER ENERGY: Taps Isaac Wiles & Burkholder as Local Counsel
----------------------------------------------------------------
Volunteer Energy Services, Inc. seeks approval from the U.S.
Bankruptcy Court for the Southern District of Ohio to hire Isaac
Wiles & Burkholder, LLC as its local counsel.
The firm's services include:
a. advising the Debtor with respect to its powers and duties
in the continued management and operation of its business and
properties;
b. advising and consulting on the conduct of the case,
including all of the legal and administrative requirements of
operating in Chapter 11;
c. attending meetings and negotiating with representatives of
the Debtor's creditors, creditors committee, the Office of the U.S.
Trustee, and other parties in interest;
d. taking all necessary actions to protect and preserve the
Debtor's estate, including prosecuting actions on the Debtor's
behalf, defending any action commenced against the Debtor, and
representing the Debtor in negotiations concerning litigation in
which it is involved, including objections to claims filed against
the estate;
e. preparing legal papers;
f. advising the Debtor in connection with any potential sale
of its assets;
g. appearing before the bankruptcy court and any appellate
courts;
h. advising the Debtor regarding insurance matters;
i. negotiate, prepare and seek approval of a disclosure
statement and confirmation of a Chapter 11 plan; and
j. performing all other necessary legal services for the
Debtor as local counsel.
The hourly rates charged by the firm for its services are as
follows:
David M. Whittaker, Partner $500
Philip K. Stovall, Associate $350
Partners $350 - $500
Associates $175 - $350
Paraprofessionals/Legal Assistants $75 - $125
David Whittaker, Esq., a partner at Isaac Wiles, disclosed in a
court filing that his firm is a "disinterested person" as such term
is defined in Bankruptcy Code Section 101(14).
The firm can be reached through:
David M. Whittaker, Esq.
Isaac Wiles & Burkholder LLC
Two Miranova Place, Suite 700
Columbus, OH 43215
Phone: 614-221-2121
Fax: 614-365-9516
Email: dwhittaker@isaacwiles.com
About Volunteer Energy Services
Volunteer Energy Services, Inc., an electric power provider based
in Pickerington, Ohio, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Ohio Case No. 22-50804) on March 25,
2022. In the petition signed by David Warner, chief financial
officer, the Debtor disclosed up to $100 million in both assets and
liabilities.
Judge C. Kathryn Preston oversees the case.
McDermott Will & Emery, LLP and Isaac Wiles and Burkholder, LLC
serve as the Debtor's lead bankruptcy counsel and local counsel,
respectively. GlassRatner Advisory & Capital Group, LLC, doing
business as B. Riley Advisory Services, is the Debtor's financial
advisor.
VOLUNTEER ENERGY: Taps McDermott Will & Emery as Bankruptcy Counsel
-------------------------------------------------------------------
Volunteer Energy Services, Inc. seeks approval from the U.S.
Bankruptcy Court for the Southern District of Ohio to hire
McDermott Will & Emery, LLP to serve as legal counsel in its
Chapter 11 case.
The firm's services include:
a. advising the Debtor with respect to its powers and duties
in the continued management and operation of its business and
properties;
b. advising and consulting on the conduct of the case,
including all of the legal and administrative requirements of
operating in Chapter 11;
c. attending meetings and negotiating with representatives of
the Debtor's creditors and other parties in interest;
d. taking all necessary actions to protect and preserve the
Debtor's estate, including prosecuting actions on the Debtor's
behalf, defending any action commenced against the Debtor, and
representing the Debtor in negotiations concerning litigation in
which it is involved, including objections to claims filed against
the estate;
e. preparing legal papers;
f. advising the Debtor in connection with any disposition of
assets;
g. appearing before the bankruptcy court and any appellate
courts;
h. advising the Debtor regarding tax matters;
i. advising the Debtor regarding insurance and regulatory
matters;
j. negotiate, prepare and seek approval of a disclosure
statement and confirmation of a Chapter 11 plan; and
k. performing all other necessary legal services for the
Debtor.
The hourly rates charged by the firm's attorneys and
paraprofessionals are as follows:
Darren Azman, Partner $1,170
Stacy Lutkus, Employee Counsel $1,020
Gregg Steinman, Associate $940
Daniel Thomson, Associate $905
Natalie Rowles, Associate $870
Partners $950 - $1,305
Employee Counsel $525 - $1,020
Associates $580 - $940
Paraprofessionals $70 - $435
Darren Azman, Esq., a partner at McDermott, disclosed in a court
filing that the firm is a "disinterested person" as such term is
defined in Bankruptcy Code Section 101(14).
The firm can be reached through:
Darren Azman, Esq.
Natalie Rowles, Esq.
McDermott Will & Emery, LLP
One Vanderbilt Avenue
New York, NY 10017-3852
Tel: (212) 547-5400
Fax: (212) 547-5444
Email: dazman@mwe.com
nrowles@mwe.com
About Volunteer Energy Services
Volunteer Energy Services, Inc., an electric power provider based
in Pickerington, Ohio, sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Ohio Case No. 22-50804) on March 25,
2022. In the petition signed by David Warner, chief financial
officer, the Debtor disclosed up to $100 million in both assets and
liabilities.
Judge C. Kathryn Preston oversees the case.
McDermott Will & Emery, LLP and Isaac Wiles and Burkholder, LLC
serve as the Debtor's lead bankruptcy counsel and local counsel,
respectively. GlassRatner Advisory & Capital Group, LLC, doing
business as B. Riley Advisory Services, is the Debtor's financial
advisor.
WEI SALES: Moody's Lowers CFR to B2 & First Lien Term Loan to B3
----------------------------------------------------------------
Moody's Investors Service downgraded WEI Sales LLC's Corporate
Family Rating to B2 from B1 and Probability of Default Rating to
B2-PD from B1-PD. In addition, Moody's also downgraded the rating
on WEI's first lien term loan due 2025 to B3 from B2. The outlook
is stable.
The downgrade reflects Moody's view that operating profits will
remain weak in the next 12 to 18 months as inflationary costs
pressures, such as diary, freight, and labor, continue to challenge
the company's operations. WEI ended fiscal 2021 with Moody's
adjusted debt/EBITDA of approximately 5x on an LTM basis, excluding
the effect of unusually large equity compensation revaluation.
Although the company is announcing price increases to offset
inflationary headwinds, Moody's believes that WEI's LTM debt/EBITDA
is likely to remain above 5x in the next 12 to 18 months.
WEI is continuing to execute its strategy to shift to higher growth
products and the resulting investment along with distributions and
working capital needs continue to lead to negative free cash flow.
Moody's views WEI's continued shift in focus away from its lower
margin private label business (54% of sales in FY21) as a credit
positive, although inflationary headwinds in the next 12 to 18
months are likely to offset any operating margin improvement as a
result of the shift in business mix. Over the last few years, WEI
has made a number of investments (organic and through acquisitions)
to increase its mix of higher growth branded and novelty ice cream
sales. These investments have proven beneficial to the company's
revenues, particularly in 2021 as novelty ice cream category sales
grew 6.3% in 2021 compared to 2020 while packaged ice cream sales
declined 6.5% as a category during that same time period according
to Nielsen data.
Moody's expects WEI's EBITDA to remain relatively flat in fiscal
2022 and fiscal 2023 compared to fiscal 2021, despite a low single
digit increase in revenues, as inflationary headwinds are likely to
continue to impact operating profits, at least through the first
half of fiscal 2023. In fiscal 2022, Moody's is forecasting WEI to
incur a free cashflow deficit of approximately $80-85 million, as
the company funds capital expenditures of approximately $85
million, working capital needs, and pays a dividend of
approximately $14 million. However, in fiscal 2023, Moody's
believes that WEI could generate break-even free cashflow, even
while funding $70-80 million in capital expenditures and paying a
dividend of approximately $14 million, as lower equity based
non-cash compensation expenses and working capital improvements
lead to higher cash from operations in fiscal 2023. Moody's expects
debt to EBITDA leverage to remain relatively flat over the next two
fiscal years as higher debt levels, as a result of negative free
cash flow in fiscal 2022, offset any improvements in EBITDA in
fiscal 2023.
The following ratings/assessments are affected by the action:
Downgrades:
Issuer: WEI Sales LLC
Corporate Family Rating, Downgraded to B2 from B1
Probability of Default Rating, Downgraded to B2-PD from B1-PD
Senior Secured 1st Lien Bank Credit Facility, Downgraded to B3
(LGD4) from B2 (LGD4)
Outlook Actions:
Issuer: WEI Sales LLC
Outlook, Changed To Stable From Negative
RATINGS RATIONALE
WEI's B2 CFR reflects its participation in the low growth and
highly competitive ice cream industry and modest scale relative to
the two global ice cream market leaders, Nestlé, and Unilever. The
company's credit profile also reflects high financial leverage with
debt to EBITDA of 5x as of last-twelve-months ending January 1,
2022. Leverage is elevated as inflationary cost pressures and a
decline in packaged ice cream sales have negatively impacted
EBITDA. Moody's projects debt-to-EBITDA leverage will remain around
5x in the next 12 to 18 months. Additionally, WEI's practice of
distributing the bulk of operating cash flow less capital
expenditures to shareholders is aggressive and diminishes financial
flexibility. The company benefits from solid niche positions in
both private label and branded ice cream for novelty and packaged
ice cream products.
WEI's adequate liquidity reflects Moody's expectation that free
cash flow will be negative in fiscal 2022, in the range of $80-90
million, and close to flat in fiscal 2023. Liquidity is supported
by a $225 million ABL revolving credit facility that expires in
2025, which had less than $1 million drawn as of January 1, 2022.
In addition, the company had approximately $22 million in cash as
of January 1, 2022. Moody's estimates that the company will have to
draw on its revolver in Fiscal 2022 to fund capital expenditures of
approximately $80 million and dividends of approximately $14
million. WEI doesn't have any significant debt maturities until
2025. The cash sources provide good coverage for the $6.1 million
in mandatory annual term loan amortization.
ESG CONSIDERATIONS
WEI has neutral to low exposure to physical climate risk, carbon
transition and water management. The company is moderately
negatively exposed to some other environmental risks. Waste and
pollution is moderately negative reflecting the waste created from
consumer food packaging materials that often are not or cannot be
recycled. The moderately negative exposure to natural capital
reflects the risks around the environmentally sustainable
procurement of raw materials.
WEI, like the overall packaged food sector is moderately exposed to
social risks related to responsible production, health and safety
standards, and customer relations. The company is moderately
exposed to responsible production which reflects the sourcing of a
number of raw materials. The company must cost-effectively manage a
supply chain to ensure sufficient flow of raw materials to meet
production schedules. In addition, the company has moderately
negative exposure to health and safety and customer relations, like
other food companies that face risks around proper labeling,
contamination or product recalls.
In terms of governance, Moody's views WEI's financial policy as
aggressive. This is supported by the company's debt funded
acquisitions and investments, family ownership, aggressive
shareholder distributions, and negative free cash flow generation.
Of note, payouts on the company's multi-year equity-based
compensation have also contributed to negative free cash flow. The
aggressive financial policy is also evident in the current
financial leverage of 5.0x. Family ownership also has favorable
operating influences. The current CEO, Michael Wells, is the
grandson of Fred H. Wells, who founded the business in 1913. The
family's heritage creates a long-term investment orientation that
supports solid plant operation, product quality and customer
relationships, which are ultimately beneficial to operating cash
flow generation.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectations that WEI will
benefit from price increases that the company has already taken,
and operating margins will improve in the second half of fiscal
2022 and in Fiscal 2023. In addition, the stable outlook also
assumes that the company will maintain adequate liquidity to fund
operating needs in 2022 including capital spending and working
capital, and that the company will not incur a free cash flow
deficit in fiscal 2023.
Ratings could be upgraded if the company maintains stable operating
performance including positive organic growth, improves the EBITDA
margin, generates sustained and comfortably positive free cash
flow, and maintains good liquidity. Debt to EBITDA would need to be
sustained below 4x to be considered for an upgrade.
Ratings could be downgraded if WEI's market position erodes,
revenue declines, the EBITDA margin contracts further, or if
acquisitions and investments fail to translate into meaningful
earnings growth that reduces leverage. Ratings could also be
downgraded if liquidity deteriorates, financial policy turns more
aggressive, or if debt to EBITDA is sustained above 5.5x.
Headquartered in Le Mars, Iowa, family-owned Wells Enterprises,
Inc. manufactures ice cream for sale to customers throughout the
United States. The company sells both branded products and private
label products. The company manufactures its products in four
facilities located in Iowa, New York and New Jersey, and Nevada,
providing it with national manufacturing capabilities. Annual sales
were $1.6 billion for the last-twelve-months ending January 1,
2022.
The principal methodology used in these ratings was Consumer
Packaged Goods Methodology published in February 2020.
ZARA MANAGEMENT: Loan Proceeds, and/or Property Sale, to Fund Plan
------------------------------------------------------------------
Zara Management, LLC, filed with the U.S. Bankruptcy Court for the
Eastern District of Michigan a Combined Plan of Reorganization and
Disclosure Statement dated April 18, 2022.
Zara Management, LLC, is a Michigan limited liability company. The
Debtor has two members, Dr. Iqbal Nasir (99%) and Shahida Nasir
(1%). The Debtor owns a parcel of real estate located at 13840 King
Road, Riverview, Michigan 48193.
Debtor's sole business is to own the land and building and act as a
landlord to a nursing home owned by Sana Nasir, Inc. (known as
Aerius Health Center). The only significant obligation of the
Debtor was owed to JPMorgan Chase Bank, N.A., pursuant to a
guaranty on a loan to such tenant.
The intervention of the Covid pandemic then made it virtually
impossible for the nursing home to obtain refinancing of the Chase
loan. As the restrictions are being lifted, it is anticipated that
there is again a lending market for nursing homes. It will be the
proceeds of a loan and/or a sale of the nursing home that will fund
this Chapter 11 Plan.
Class 1 shall consist of the Allowed Secured Claim of Fund
Investment 141, LLC. Class 1 Creditor Fund Investment 141, LLC's
claim is unimpaired. The Debtor guaranteed a loan from JPMorgan
Chase Bank, N.A. to Sana Nasir, Inc., which loan is secured by a
mortgage on the Debtor's property. Sana Nasir, Inc. is an affiliate
of the Debtor, is the Debtor's tenant and owns and operates a
nursing home known as Aerius. Chase assigned the loan and security
documents to Fund Investment 141, LLC (the "Fund").
Beginning on the Effective Date, Debtor will pay to the Fund an
amount equal to an interest only payment of 4.416% percent of the
Allowed Secured Claim in the amount of $5,484.12 on a monthly
basis, which will be applied to the outstanding principal and
interest on the loan. One hundred twenty days after the
adjudication of the amount of Fund's Allowed Secured Claim, the
Debtor's property and or the property of its affiliate Sana Nasir,
Inc. will be sold or refinanced in an amount sufficient to pay the
Allowed Secured Claim in full. All real estate taxes have been and
shall continue to be paid when due and the Debtor shall maintain
insurance on the property and provide that the secured creditor is
an insured beneficiary of its interest in its collateral. This
Creditor will retain its mortgage lien on the property until paid
in full.
Class 2 shall consist of all allowed non-priority unsecured claims
against the Debtor, including but not limited to, penalties and
interest on penalties for any general priority tax claim. The Class
2 Creditors are unimpaired under the Plan. The General Unsecured
Creditors shall receive the full amount of their claims on the
Effective Date.
Class 3 shall consist of all unsecured claims of Debtor's insiders,
Dr. Iqbal Nasir and his wife, Shahida Nasir ("Insider Claims").
Class 3 Creditors, Debtor's insiders, Dr. Iqbal Nasir and his wife,
Shahida Nasir ("Insider Claims") are impaired. The Insider Claims
shall be subordinated to all other Claims and shall be paid only
after all Superior Claims have been paid in full.
Debtor's assets shall remain the Debtor's possession and control.
The Debtor has heretofore guaranteed a loan from JPMorgan Chase
Bank, N.A. to Sana Nasir, Inc., its affiliate and tenant, which
loan is secured by a mortgage on the Debtor's property. Chase
assigned the loan and security documents to Fund Investment 141,
LLC (the "Fund"). The Fund asserts that the Debtor's obligations to
it also secures a separate loan made by Chase to SN Management,
LLC, a separate and distinct entity in the original amount of
$4,492,823.
It is the Debtor's position that it has never executed a note or a
guaranty for any amount borrowed by SN Management, LCC from Chase
that is now held by Fund and that the mortgage held by the Fund
against Debtor does not secure the debt of SN Management, LLC. The
Debtor will file an objection to the claim of the Fund to the
extent it is based upon any obligation the Debtor arising out of
the loan to SN Management, LLC.
The Debtor's tenant will pay as rent an amount equal to the monthly
interest payment due the Fund under this plan and shall provide all
insurance on the property and pay all real estate taxes until the
claim of the Fund is allowed and paid in full under the terms of
this Plan. One hundred twenty days after the adjudication and
allowance of the amount of Fund's Allowed Secured Claim against the
Debtor, the Debtor's property and/or the property of its affiliate
tenant Sana Nasir, Inc. will be sold or refinanced in an amount
sufficient to pay the Allowed Secured Claim in full. Immediately
upon such sale or refinance, the Fund's Allowed Secured Claim shall
be paid in full.
A full-text copy of the Combined Plan and Disclosure Statement
dated April 18, 2022, is available at https://bit.ly/3vaodt6 from
PacerMonitor.com at no charge.
Debtor's Attorney:
Jerome D. Frank, Esq.
Tami R. Salzbrenner, Esq.
Frank & Frank, PLLC
30833 Northwestern Hwy. Suite 205
Farmington Hills, MI 48334
Phone: (248) 932-1440
Fax: (248) 932-1443
Email: mfrank@frankfirm.com
tami@frankfirm.com
About Zara Management
Zara Management, LLC, a company based in Riverview, Mich., sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. E.D.
Mich. Case No. 21-49032) on Nov. 17, 2021. Dr. Iqbal Nasir,
managing member, signed the petition.
As of Dec. 31, 2020, the Debtor had $5,267,008 in assets and
$1,653,308 in liabilities.
Jerome D. Frank, Esq., and Tami R. Salzbrenner, Esq., at Frank &
Frank, PLLC are the Debtor's bankruptcy attorneys.
ZOHAR FUNDS: Tilton Sued for Mishandling Sale of Dura Automotive
----------------------------------------------------------------
Jef Feeley of Bloomberg News reports that a bankruptcy trustee for
car-parts company Dura Automotive said in a lawsuit that
distressed-debt investor Lynn Tilton mishandled the proposed sale
of Dura Automotive Systems and cost investors "hundreds of millions
of dollars" in losses, a bankruptcy trustee for the car-parts
company said in a lawsuit.
Tilton and Dura Chief Financial Officer Kevin Grady harmed Dura "in
an effort to benefit" themselves by scuttling the sale, according
to a Delaware Chancery Court suit unsealed Thursday, April 21,
2022.
The complaint was filed by Dura bankruptcy trustee Jeoffrey Burtch,
who alleged alleged Tilton scuttled a potential $875 million sale
of Dura in 2019 because “the expected net proceeds would not have
been enough.
About the Zohar Funds
New York-based Patriarch Partners, LLC, is a private equity firm
specializing in acquisition, buyouts, and turnaround investment in
distressed American companies and brands. Patriarch Partners was
founded by Lynn Tilton in 2000. Lynn Tilton and her affiliates held
substantial equity stakes in portfolio companies, which include
iconic American manufacturing companies with tens of thousands of
employees.
The Zohar funds were created to raise money through selling a form
of notes called collateralized loan obligations to investors that
was then used to extend loans to dozens of distressed mid-size
companies, often in connection with the acquisition of those
companies out of bankruptcy.
Patriarch bought "distressed" companies via funding from a series
of collateralized loan obligations (CLOs) marketed through
Patriarch via its $2.5 billion "Zohar" funds. Tilton placed the
funds into bankruptcy in 2018 in an attempt to keep Patriarch's
portfolio from being liquidated by Zohar creditors including bond
insurer MBIA, which insured $1 billion worth of Zohar notes.
Combined debt of the funds is estimated at $1.7 billion.
Zohar CDO 2003-1, Zohar CDO 2003-1 Corp., Zohar II 2005-1, Limited,
Zohar II 2005-1 Corp., Zohar III, Limited, and Zohar III, Corp.
(collectively, the "Zohar Funds"), sought protection under Chapter
11 of the Bankruptcy Code (Bankr. D. Del. Case Nos. 18-10512 to
18-10517) on March 11, 2018. In the petition signed by Lynn Tilton,
director, the Debtors were estimated to have $1 billion to $10
billion in assets and $500 million to $1 billion in liabilities.
Young Conaway Stargatt & Taylor, LLP, is the Debtors' bankruptcy
counsel.
[^] BOND PRICING: For the Week from April 18 to 22, 2022
--------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
AT&T Inc T 3.600 100.174 7/15/2025
AT&T Inc T 4.050 101.731 12/15/2023
Accelerate Diagnostics Inc AXDX 2.500 70.234 3/15/2023
Assabet Valley Bancorp AVBANC 5.500 91.205 08/01/2027
Assabet Valley Bancorp AVBANC 5.500 91.205 08/01/2027
BPZ Resources Inc BPZR 6.500 3.017 03/01/2049
Basic Energy Services Inc BASX 10.750 3.268 10/15/2023
Basic Energy Services Inc BASX 10.750 3.268 10/15/2023
Buffalo Thunder
Development Authority BUFLO 11.000 50.000 12/09/2022
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 6.625 21.993 8/15/2027
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 6.625 21.722 8/15/2027
EnLink Midstream Partners ENLK 6.000 75.500 N/A
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 65.210 1/15/2023
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 65.210 1/15/2023
Energy Conversion Devices ENER 3.000 7.875 6/15/2013
Enterprise Products
Operating LLC EPD 4.875 90.635 8/16/2077
Exela Intermediate LLC /
Exela Finance Inc EXLINT 11.500 40.332 7/15/2026
Exela Intermediate LLC /
Exela Finance Inc EXLINT 10.000 66.250 7/15/2023
Exela Intermediate LLC /
Exela Finance Inc EXLINT 11.500 42.017 7/15/2026
Exela Intermediate LLC /
Exela Finance Inc EXLINT 10.000 66.750 7/15/2023
Federal Home Loan Banks FHLB 2.125 99.453 4/29/2022
GNC Holdings Inc GNC 1.500 0.185 8/15/2020
GTT Communications Inc GTTN 7.875 10.000 12/31/2024
GTT Communications Inc GTTN 7.875 8.250 12/31/2024
General Electric Co GE 4.000 76.608 N/A
Goodman Networks Inc GOODNT 8.000 89.556 05/11/2022
IntelGenx Technologies IGXT 8.000 92.000 6/30/2022
Lannett Co Inc LCI 4.500 28.152 10/01/2026
MAI Holdings Inc MAIHLD 9.500 29.469 06/01/2023
MAI Holdings Inc MAIHLD 9.500 29.469 06/01/2023
MAI Holdings Inc MAIHLD 9.500 29.469 06/01/2023
MBIA Insurance Corp MBI 12.304 11.795 1/15/2033
MBIA Insurance Corp MBI 12.304 11.795 1/15/2033
Macquarie Infrastructure
Holdings LLC MIC 2.000 95.093 10/01/2023
Morgan Stanley MS 1.800 79.029 8/27/2036
Nine Energy Service Inc NINE 8.750 65.405 11/01/2023
Nine Energy Service Inc NINE 8.750 64.277 11/01/2023
Nine Energy Service Inc NINE 8.750 64.209 11/01/2023
OMX Timber Finance
Investments II LLC OMX 5.540 0.752 1/29/2020
Plains All American
Pipeline LP PAA 6.125 85.000 N/A
Renco Metals Inc RENCO 11.500 24.875 07/01/2003
Revlon Consumer Products REV 6.250 32.105 08/01/2024
Sears Holdings Corp SHLD 8.000 2.050 12/15/2019
Sears Holdings Corp SHLD 6.625 2.247 10/15/2018
Sears Holdings Corp SHLD 6.625 2.163 10/15/2018
Sears Roebuck Acceptance SHLD 6.500 0.956 12/01/2028
Sears Roebuck Acceptance SHLD 7.000 1.123 06/01/2032
Sears Roebuck Acceptance SHLD 6.750 1.051 1/15/2028
Sears Roebuck Acceptance SHLD 7.500 0.877 10/15/2027
TPC Group Inc TPCG 10.500 33.935 08/01/2024
TPC Group Inc TPCG 10.500 35.181 08/01/2024
Talen Energy Supply LLC TLN 6.500 35.756 06/01/2025
Talen Energy Supply LLC TLN 10.500 35.245 1/15/2026
Talen Energy Supply LLC TLN 9.500 59.910 7/15/2022
Talen Energy Supply LLC TLN 9.500 58.410 7/15/2022
Talen Energy Supply LLC TLN 10.500 35.770 1/15/2026
Talen Energy Supply LLC TLN 6.500 32.370 9/15/2024
Talen Energy Supply LLC TLN 6.500 32.370 9/15/2024
Talen Energy Supply LLC TLN 10.500 36.307 1/15/2026
Talos Petroleum LLC SGY 7.500 95.606 5/31/2022
TerraVia Holdings Inc TVIA 5.000 4.644 10/01/2019
Trousdale Issuer LLC TRSDLE 6.500 33.000 04/01/2025
Wayfair Inc W 0.375 86.833 09/01/2022
Wesco Aircraft Holdings WAIR 13.125 42.874 11/15/2027
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., 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.
This material is copyrighted and any commercial use, resale or
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re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
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e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000.
*** End of Transmission ***