/raid1/www/Hosts/bankrupt/TCR_Public/220606.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, June 6, 2022, Vol. 26, No. 156
Headlines
265 LAUREL AVENUE: July 27 Hearing on Disclosure Statement
265 LAUREL AVENUE: Rental Income to Fund Plan
4E BRANDS: Asks Court Okay to Recycle Entire Tainted Hand Sanitizer
626 HOSPICE: Hospice Agency Starts Subchapter V Case
A.G. DILLARD: June 16 Hearing on Cash Collateral Access
ABARTA OIL: Surety Says It's Singled Out in Plan
ADVANCED DRAINAGE: Moody's Rates New $500MM Unsecured Notes 'Ba2'
ADVANCED DRAINAGE: S&P Assigns 'B+' Rating on Sr. Unsecured Notes
AGILON ENERGY: Unsecureds' Recovery "Unknown" in Joint Plan
ALEXANDRIA HOSPITALITY: Byline Questions Sale Plan
ALL YEAR HOLDINGS: Remaining Unsecureds Will Get 11% to 17% in Plan
ALL YEAR HOLDINGS: Will Transfer Equity for $60 Million
ARMSTRONG FLOORING: Court OKs June Auctions for Assets
ART & ANTIQUES: Has Cash Collateral Access Thru June 25
BFCD PROPERTIES: Court Approves Disclosure Statement
BIOSTAGE INC: Raises $5M in Financing to Advance Clinical Trial
BOUCHARD TRANSPORTATION: Judge Backs $4.2M Fee for Losing Bidder
BRAZORIA HYDROCARBON: Ordered to File Motion to Modify Plan
BRIGHT MOUNTAIN: Delays Filing of First Quarter Form 10-Q
BUILDERS FIRSTSOURCE: Moody's Rates $600MM Unsecured Notes 'Ba2'
CAMBER ENERGY: Antilles Family Holds 9.99% Equity Stake
CAMBER ENERGY: Incurs $264.6 Million Net Loss in Q3 2021
CAMBER ENERGY: Posts $62.8 Million Net Income in Q2 2021
CANO HEALTH: All Four Proposals Passed at Annual Meeting
CARS.COM INC: S&P Alters Outlook to Positive, Affirms 'B+' ICR
CDK GLOBAL: Moody's Assigns B2 CFR & Rates New First Lien Loans B1
CDK GLOBAL: S&P Downgrades ICR to 'B+' on Leveraged Buyout
CHARMING CHARLIE: Amends Unsecured Claims Pay; Plan Hearing July 20
CNBX PHARMACEUTICALS: Effects 1-for-120 Reverse Stock Split
COLEMAN COMMERCIAL: Unsecureds to Get 100 Cents on Dollar in Plan
COMSTOCK RESOURCES: Moody's Ups CFR to B1, Outlook Remains Stable
CORP GROUP: Plan Deal Signed, Committee Objection Narrowed
CPE FEEDS: Creditors to Get Proceeds From Liquidation
CRUMP ENGINEERING: Case Summary & Three Unsecured Creditors
CTCW-WATERFORD: Case Summary & Four Unsecured Creditors
DIOCESE OF CAMDEN: Cross, Ava Law Update Advise 13 Abuse Claimants
EL JEBOWL: Bankruptcy Exit Plan Needs Creditors' Blessing
ENVIA HOLDINGS: Voluntary Chapter 11 Case Summary
FAIRPORT BAPTIST: U.S. Trustee Appoints Creditors' Committee
FIRST TO THE FINISH: Wins Cash Collateral Access Thru June 14
FLOOR-TEX COMMERCIAL: Wins Cash Collateral Access Thru June 9
FRONT SIGHT MANAGEMENT: $5MM DIP Loan from FS DIP LLC OK'd
GAMESTOP CORP: Appoints Nir Patel as Chief Operating Officer
GARUDA HOTELS: U.S. Trustee Unable to Appoint Committee
GARUDA HOTELS: Wins Interim Cash Collateral Access Thru June 28
GIRARDI & KEESE: California Supreme Court Disbarred Tom Girardi
GLS AUTO 2022-2: S&P Assigns Prelim BB- (sf) Rating on E Notes
GREENE TECHNOLOGIES: Unsecureds Will Get 5% of Claims in 60 Months
GT REAL ESTATE: In Chapter 11 as Panthers Cancel Rock Hill HQ
GT REAL ESTATE: June 9 Deadline Set for Panel Questionnaires
HELLO LIVING: Amends Mezz Lender Secured Claim Pay Details
HERTZ GLOBAL: Judge Balks at Wider Probe of Customer Arrests
HOME PRODUCTS: Case Summary & 30 Largest Unsecured Creditors
INFOW LLC: Reaches Deal With U.S. Trustee to Dismiss Bankruptcy
IRIS HOLDING: S&P Assigns Preliminary 'B' ICR, Outlook Negative
J & J CONSULTING: U.S. Trustee Appoints Creditors' Committee
JANE STREET: Fitch Assigns 'BB+' LongTerm Issuer Default Rating
JGR GROUP: Voluntary Chapter 11 Case Summary
KINETIK HOLDINGS: Fitch Assigns BB+ LongTerm Issuer Default Rating
KINETIK HOLDINGS: Moody's Gives First Time Ba1 Corp. Family Rating
KW EXCAVATION: Starts Chapter 11 Subchapter V Case
LTL MANAGEMENT: Examiner Gets in $952K Fee Cuts in Chapter 11
LUZERNE IRONWORKS: Case Summary & Eight Unsecured Creditors
MAGNETITE XXXIII: S&P Assigns Prelim BB-(sf) Rating on Cl. E Notes
MODERN LAND: Chapter 15 Case Summary
MODERN LAND: CN Developer Seeks US Recognition of Cayman Scheme
MOVIMIENTO PENTECOSTAL: Exclusivity Period Extended to June 16
MYOMO INC: MUST Asset, et al. Report 6.73% Equity Stake
NAIL CARE: Case Summary & Four Unsecured Creditors
NATIONAL CINEMEDIA: AMC, Multi-Cinema Acquire 6.8% Equity Stake
NERAM GROUP: Wins Interim Cash Collateral Access Thru Sept 30
NORDIC AVIATION: Norton Rose Advised Secured Creditors
OLYMPIA SPORTS: Unsecured Creditors Will Get 22% of Claims in Plan
ORGANIC GREEN LAWN: Files Case Pro Se; UST Seeks Dismissal
PARADISE REDEVELOPMENT: S&P Lowers ICR to 'CCC', Outlook Negative
PLAYER'S POKER: Exclusivity Period Extended to Aug. 4
QHC FACILITIES: Exclusivity Period Extended to June 27
QUANTUM CORP: Neuberger Berman Entities Report 18.46% Equity Stake
REHOBOTH PIPELINE: Exclusivity Period Extended to July 1
RUBY PIPELINE: Bondholders Frustrated by Slow Sale Process
SHYREX INVESTMENTS: Property Sale Proceeds to Fund Plan Payments
SILVER LAKES RESORT: Unsecured Creditors Will Get 100% in Plan
SKY INN OPERATION: Unsecureds to be Paid in Full in 60 Months
SLM FFELP: S&P Affirms B (sf) Ratings on Eight Classes of Notes
SLM STUDENT 2008-4: S&P Lowers Class B Notes Rating to CC (sf)
SOUTH TEXAS ELV: Case Summary & 20 Largest Unsecured Creditors
STRATEGIC IQ LLC: Unsecureds to Get Share of Income for 60 Months
SUNGARD AS: Committee Seeks to Hire Pachulski as Counsel
TALEN ENERGY: Chamberlain, Meyer Unkovic Advise Energy Brokers
TENET HEALTHCARE: Fitch Rates New First Lien Notes 'BB-'
TENET HEALTHCARE: Moody's Rates $1.8BB First Lien Notes 'B1'
THOMASBORO LANDCO: Unsecureds to be Paid in Full in 36 Months
TIDEWATER MIDSTREAM: S&P Lowers ICR to 'CCC' on Watch Developing
TPC GROUP: Cerberus Capital Battles SVP Over Bankrupt Company
TPC GROUP: June 7 Deadline Set for Panel Questionnaires
TPC GROUP: Milbank, Pachulski Advise Non-Consenting Bondholders
TPC GROUP: Paul Hastings, YCST Advise Supporting Noteholders
TRANSOCEAN LTD: Frederik Mohn Reports 12.2% Equity Stake
TRIDENT HOLDINGS: Amends Residential Mortgage Secured Claim Pay
VERTEX ENERGY: Board OKs Stock Option Grants to CEO, CFO
VOS CRE I: Amends Plan to Include Daniel J. Vosotas Trust Claim
VS DEVELOPING: Voluntary Chapter 11 Case Summary
WAYNE HEALTHCARE: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
WHITE RABBIT: Wins Cash Collateral Access Thru June 30
YUNHONG CTI: Incurs $7.6 Million Net Loss in 2021
ZOTEC PARTNERS: Moody's Lowers CFR & First Lien Debt to B3
ZZ HOME CARE: Files Emergency Bid to Use Cash Collateral
[^] BOND PRICING: For the Week from May 30 to June 3, 2022
*********
265 LAUREL AVENUE: July 27 Hearing on Disclosure Statement
----------------------------------------------------------
The Honorable Kathryn C. Ferguson will convene a hearing on the
adequacy of the Disclosure Statement explaining the Plan of 265
Laurel Avenue, LLC, for July 7, 2022 at 2:00 p.m. in Courtroom No.
2, Clarkson S. Fisher Courthouse, 402 East State Street, Trenton,
NJ 08608.
Written objections to the adequacy of the Disclosure Statement must
be filed and served no later than 14 days prior to the hearing
before this Court, unless otherwise directed by the court.
The Debtor filed a Chapter 11 Plan and a Disclosure Statement on
May 31, 2022. The Plan proposes to treat claims and interests as
follows:
* Wilmington Savings Funds Society, FSB, d/b/a Christiana Trust
has a secured claim in the amount of $401,453.35 secured by a lien
on real property commonly known as 265 Laurel Avenue, Lakewood,
County, New Jersey. The Debtor has applied for a loan modification
from Wilmington, the terms of which have yet to be provided. Once
received and agreed upon by the Debtor, funds for payments to
Wilmington shall be derived from the Debtor's rental income. In
the event of a shortfall from the rental proceeds, any additional
funds that are necessary will be provided as capital contributions
by the Debtor's sole member, Marcel Katz.
* Santander Bank has a claim in an unknown amount secured by a
lien on real property commonly known as 265 Laurel Avenue,
Lakewood, Ocean County, New Jersey. The real property securing
this claim is worth $400,000. The lien of Wilmington ($401,453) is
greater than the value of the Property and superior to the lien of
this creditor. The creditor has not filed a proof of claim. In
the event it does file a secured claim its claim will be modified
to an unsecured claim pursuant to 506(a) and (d) and the lien shall
be void.
* The Debtor shall retain ownership of his assets except to the
extent
provided in the Plan.
The funds needed to fulfill the Debtor's obligations under the Plan
will be derived from rental income from the Debtor's real property.
If the rental proceeds are insufficient to cover the loan payments
to Wilmington in accordance with the anticipated modification
agreement, the managing member has agreed to provide capital
contributions to cover any shortfall for the duration of the plan.
The Debtor is entitled to file a modified plan of reorganization
rather than liquidation whereby it shall attempt to restructure its
debts in accordance with agreements made with his secured
creditors.
About 265 Laurel Avenue
265 Laurel Avenue, LLC, is a Limited Liability Company formed for
the purpose of owning real estate properties.
265 Laurel Avenue previously filed a Chapter 11 bankruptcy petition
(Bankr. D.N.J. Case No. 19-10449) on Jan. 8, 2019.
265 Laurel Avenue again filed a Chapter 11 bankruptcy petition
(Bankr. D.N.J. Case No. 19-25648) on Aug. 13, 2019.
Unable to meet its obligations and facing a sheriff sale, 265
Laurel Avenue recently sought Chapter 11 protection (Bankr. D.N.J.
Case No. 22-11355) on Feb. 21, 2022. The Debtor disclosed under $1
million in both assets and liabilities.
Timothy P. Neumann, at Broege Neumann Fischer & Shaver, LLC, is
serving as counsel to the Debtor.
265 LAUREL AVENUE: Rental Income to Fund Plan
---------------------------------------------
265 Laurel Avenue, LLC, filed with the U.S. Bankruptcy Court for
the District of New Jersey a Disclosure Statement describing
Chapter 11 Plan dated May 31, 2022.
The Debtor is Limited Liability Company formed for the purpose of
owning real estate properties. The Debtor was unable to meet its
obligations and was facing a sheriff sale.
The Debtor has retained a realtor and proposes to market and sell
his real property.
Class 1 consists of the Secured Claim of Wilmington Savings Funds
Society, FSB, d/b/a Christiana Trust in the amount of $401,453.35
secured by a lien on real property commonly known as 265 Laurel
Avenue, Lakewood, County, New Jersey (the "Property").
The Debtor has applied for a loan modification from Wilmington, the
terms of which have yet to be provided. Once received and agreed
upon by the Debtor, funds for payments to Wilmington shall be
derived from the Debtor's rental income. In the event of a
shortfall from the rental proceeds, any additional funds that are
necessary will be provided as capital contributions by the Debtor's
sole member, Marcel Katz. In the event of default during or after
the trial period of the loan modification, the Debtor shall have 30
days to cure said default. If the Debtor has not cured the default
within 30 days Wilmington is free to exercise its state court
remedies.
Class 2 consists of the Unsecured Claim of Santander Bank in an
unknown amount secured by a lien on real property commonly known as
265 Laurel Avenue, Lakewood, Ocean County, New Jersey. The real
property securing this claim is worth $400,000. The lien of
Wilmington ($401,453.35) is greater than the value of the Property
and superior to the lien of this creditor. The creditor has not
filed a proof of claim. In the event it does file a secured claim
its claim will be modified to an unsecured claim pursuant to 506(a)
and (d) and the lien shall be void.
Class 3 consists of Debtor's ownership interests in his assets. The
Debtor shall retain ownership of his assets except to the extent
provided in the Plan.
The funds needed to fulfill the Debtor's obligations under the Plan
will be derived from rental income from the Debtor's real property.
If the rental proceeds are insufficient to cover the loan payments
to Wilmington in accordance with the anticipated modification
agreement, the managing member has agreed to provide capital
contributions to cover any shortfall for the duration of the plan.
The Debtor is entitled to file a modified plan of reorganization
rather than liquidation whereby it shall attempt to restructure its
debts in accordance with agreements made with his secured
creditors.
A full-text copy of the Disclosure Statement dated May 31, 2022, is
available at https://bit.ly/3NT3roq from PacerMonitor.com at no
charge.
Attorneys for Debtor-in-Possession:
Timothy P. Neumann, Esq.
Geoffrey P. Neumann, Esq.
Broege, Neumann, Fischer & Shaver, LLC
25 Abe Voorhees Drive
Manasquan, New Jersey 08736
Tel: (732) 223-8484
E-mail: timothy.neuman25@gmail.com
geoff.neumann@gmail.com
About 265 Laurel
265 Laurel Avenue, LLC, is a Limited Liability Company formed for
the purpose of owning real estate properties. The Debtor filed a
Chapter 11 petition (Bankr. D.N.J. Case No. 22-11355) on Feb. 21,
2022. The Debtor is represented by Timothy P. Neumann, Esq., of
BROEGE, NEUMANN, FISCHER & SHAVER LLC.
4E BRANDS: Asks Court Okay to Recycle Entire Tainted Hand Sanitizer
-------------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that 4E Brands Northamerica LLC
asked a Texas bankruptcy judge to approve its plan to destroy and
repurpose its entire inventory of tainted hand sanitizer, which
caused the company's collapse.
Getting rid of toxic hand sanitizer located in three different
Texas warehouses is a top priority for 4E Brands, which has been
given authority to borrow up to $3.6 million to dispose of the
inventory and finish liquidating its operations.
Under a proposal submitted to the U.S. Bankruptcy Court for the
Southern District of Texas on Tuesday, May 31, 2022, 4E Brands
would hire vendor Latitude Liquids to remove expired and unsellable
hand sanitizer.
About 4E Brands North America
4E Brands North America manufactured personal care and hygiene
products. Its brand name products include Blumen Hand Sanitizer,
Assured Hand Sanitizer, and various other hand sanitizers and hand
soaps. It is no longer operating.
4E Brands North America sought Chapter 11 bankruptcy protection
(Bankr. S.D. Tex. Case No. 22-50009) on Feb. 22, 2022. In the
petition filed by David Dunn as chief restructuring officer, 4E
Brands North America estimated assets up to $50,000 and liabilities
between $10 million and $50 million. The case is handled by
Honorable Judge David R. Jones. Matthew D. Cavenaugh, Esq., of
JACKSON WALKER, is the Debtor's counsel, and STRETTO is the claims
agent.
626 HOSPICE: Hospice Agency Starts Subchapter V Case
----------------------------------------------------
626 Hospice, Inc., filed for bankruptcy protection under Subchapter
V of Chapter 11 of the Bankruptcy Code in the District of Central
California.
626 Hospice is a hospice agency with an office located in Glendale,
CA, providing care within the Greater Los Angeles County area.
Hospice is in the healthcare industry, specifically in the business
of coordinating and providing patient care for individuals with a
terminal illness or other serious health problems and end-of-life
issues. Hospice may provide care and manage patient treatment
through visiting physicians, nurses, social workers, and/or
chaplains to provide comfort care to patients and their families
outside the hospital setting, wherever its patients reside.
The petition states that funds will not be available to unsecured
creditors.
The Debtor's Chapter 11 Plan Subchapter V is due by Aug. 23, 2022.
About 626 Hospice Inc.
626 Hospice Inc. is a hospital & health care company.
626 Hospice filed a petition for relief under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No.
22-12904) on May 25, 2022. In the petition filed by Natasha Gill
as CEO, 626 Hospice Inc. listed estimated liabilities between
$500,000 and $1 million.
The case is assigned to Honorable Bankruptcy Judge Ernest M.
Robles.
Yeznik O Kazandjian, of the Law Offices of Yeznik O Kazandjian, is
the Debtor's counsel.
Arturo Cisneros has been appointed as Subchapter V trustee.
A.G. DILLARD: June 16 Hearing on Cash Collateral Access
-------------------------------------------------------
A.G. Dillard, Inc. won continued access to cash collateral through
the hearing set for June 16, 2022, at 11 a.m.
The U.S. Bankruptcy Court for the Western District of Virginia,
Lynchburg Division, previously entered a Fourth Interim Order
allowing A.G. Dillard to use cash collateral on an interim basis
and provide adequate protection to Blue Ridge Bank through June 2,
2022. At Thursday's hearing, the Court directed the Debtor to
submit an interim order by June 13. Judge Rebecca B. Connelly will
hold a video conference on June 16.
Also on Thursday, the Debtor asked the Court to enter an order
approving bid procedures for
the sale of the Debtor's equity security; and authorizing and
scheduling an auction to sell the Debtor's equity security. The
Debtor hopes to receive stalking horse bids by June 13. If two or
more bids are received, the Debtor eyes a July 27 auction date.
In the Fourth Interim Order, the Court said the aggregate use of
cash collateral during the Fourth Interim Period will not exceed
$716,292 as set forth in the Budget. Should the Debtor's use of
cash collateral exceed $716,292, the Debtor's right to use cash
collateral will terminate absent the express written consent of the
Bank or further Court order.
As adequate protection, the Bank will have valid, enforceable and
perfected replacement liens on all of the Bank's post-petition date
collateral securing the obligations. The Replacement Liens will
remain effective and enforceable unless or until otherwise modified
by the Court.
The Replacement Liens will be perfected, enforceable, choate, and
effective without the necessity of the Bank taking any other action
to validate or perfect the security interests and Replacement Liens
granted to the Bank.
As further adequate protection to the Bank, the Debtor continue to
pay the Bank an amount equal to $4,000 per week.
Only to the extent the Adequate Protection is deemed to be
insufficient adequate protection under section 361 of the
Bankruptcy Code, the Bank will have a superpriority administrative
claim pursuant to sections 361 and 507(b) of the Bankruptcy Code,
for which the Bank has the burden of proof.
A copy of the order and the Debtor's budget for the period from May
5 to June 6, 2022 is available at https://bit.ly/38YBX20 from
PacerMonitor.com.
The budget attached to the Fourth Interim Order provides for total
operating expenses, on a weekly basis, as follows:
$71,712 for the week ending May 6, 2022;
$62,041 for the week ending May 13, 2022;
$65,541 for the week ending May 20, 2022;
$134,541 for the week ending May 27, 2022; and
$27,956 for the week ending June 3, 2022.
About A.G. Dillard, Inc.
A.G. Dillard, Inc. is an excavating contractor in Troy, Virginia.
It provides a wide variety of site construction services, including
site remodeling, clearing and demolition, pond repair/conversion,
excavating and grading, site concrete, and paving.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Va. Case No. 22-60115) on February 9,
2022. In the petition signed by Alan G. Dillard, III, president,
the Debtor disclosed up to $50 million in both assets and
liabilities.
Judge Rebecca B. Connelly oversee the case.
Robert S. Westermann, Esq., at Hirschler Fleischer, PC is the
Debtor's counsel.
Blue Ridge Bank, as lender, is represented by Michael D. Mueller,
Esq., at Williams Mullen.
ABARTA OIL: Surety Says It's Singled Out in Plan
------------------------------------------------
U.S. Specialty Insurance Company filed a limited objection to the
Disclosure Statement explaining Abarta Oil & Gas Co., LLC's Plan of
Liquidation.
According to Surety, if a plan or a provision of a plan is, on its
face, non-confirmable as a matter of law, then it is appropriate
for a court to disapprove the disclosure statement filed in support
of that plan. The Debtor has impermissibly singled out Surety as
part of its own class of creditors (Class 7). Accordingly, Surety
will receive no distribution in this case because, "The Debtor does
not believe any event has or will occur in the future that will
trigger or give rise to liability under the Contingent Bond
Claims." This is not an accurate classification. Moreover, as
Surety is deemed to reject the Plan, it will not be given a ballot
and not be able to affirmatively opt-out of any third party
releases in the Plan (though it appears that such a class is deemed
not to consent to any third party release).
Surety currently has non-contingent attorney fees that must be paid
pursuant to the Indemnity Agreement, and therefore at the very
least, part of Surety claims should be treated as Class 6 claims.
Moreover, by way of subrogation, Surety may become an unsecured or,
given that the beneficiaries of the Bonds are state authorities, a
secured creditor of the Debtor. Accordingly, Surety objects and
affirmatively opts out of any third party releases pursuant to the
Plan and/or requests a ballot to do so.
Counsel to the U.S. Specialty Insurance Company:
Gaston P. Loomis, Esq.
McELROY, DEUTSCH, MULVANEY & CARPENTER, LLP
300 Delaware Avenue, Suite 1014
Wilmington, DE 19801
Telephone: (302) 300-4510
Facsimile: (302) 654-4031
E-mail: gloomis@mdmc-law.com
About ABARTA Oil
ABARTA Oil & Gas Co., LLC is a Pittsburgh, Pa.-based independent
oil and gas exploration and production company operating under the
name ABARTA Energy.
ABARTA filed a petition for Chapter 11 protection (Bankr. W.D. Pa.
Case No. 21-22406) on Nov. 7, 2021, listing up to $10 million in
assets and up to $50 million in liabilities. James A. Taylor,
president and chief executive officer, signed the petition.
Judge Carlota M. Bohm oversees the case.
The Debtor tapped Campbell & Levine, LLC as legal counsel;
MorrisAnderson & Associates, Ltd. as financial advisor and
restructuring advisor; and Copper Run Capital, LLC as investment
banker.
ADVANCED DRAINAGE: Moody's Rates New $500MM Unsecured Notes 'Ba2'
-----------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to Advanced
Drainage Systems, Inc.'s (ADS) proposed $500 million senior
unsecured notes due 2030. Moody's expects the terms and conditions
of the proposed senior unsecured notes to be similar to its
existing senior unsecured notes due 2027. The unsecured notes are
pari passu. ADS's Ba1 Corporate Family Rating and all other ratings
are not impacted by the additional debt. The company's speculative
grade liquidity rating is maintained at SGL-1. The outlook is
stable.
Proceeds from the proposed notes will be used to term out revolver
borrowings, which were recently utilized for bolt-on acquisitions,
and for general corporate purposes. Moody's believes that ADS will
use excess cash for additional acquisitions and to repurchase its
shares under the company's $1.0 billion remaining authorization
program.
Moody's views the proposed transaction as credit positive since
liquidity is improving. With no borrowings at the closing of the
proposed transaction under the recently upsized and extended $600
million revolving credit facility ADS will have the most liquidity
ever, adding to ADS' financial flexibility. The increase in
incremental debt does not materially impact leverage. Moody's
projects adjusted debt-to-EBITDA improving to 1.9x on March 31,
2024 (fiscal year-end 2024) from pro forma 2.6x at fiscal year-end
2022.
"Low leverage and considerable liquidity are substantial credit
strengths," said Peter Doyle, Vice President at Moody's.
The following ratings are affected by the action:
Assignments:
Issuer: Advanced Drainage Systems, Inc.
Senior Unsecured Regular Bond/Debenture (Local Currency), Assigned
Ba2 (LGD5)
RATINGS RATIONALE
ADS' Ba1 CFR reflects Moody's expectation that the company will
continue to generate robust profitability, with EBITDA margin
sustained around 22% over the next two years versus 20.6% for
fiscal year 2022. High profitability should translate into low
leverage and good cash flow. Moody's projects adjusted
free-cash-flow-to-debt approaching 14.6% by early 2024. ADS will
benefit from expansion in the domestic construction industry. ADS
derives 49% of its revenue from commercial construction, which is
exhibiting relative long-term stability. Moody's also anticipates
good growth opportunities over the next two years for the US
Homebuilding sector, from which ADS earns 37% of its sales.
Stretched affordability due to robust home price appreciation and
rising interest rates, inflation pressures, reduced disposable
income and stock market volatility are risks that will contribute
to moderation in demand conditions for the domestic housing
sector.
ADS' SGL-1 Speculative Grade Liquidity Rating reflects Moody's view
that the company will maintain a very good liquidity profile over
the next two years, generating free cash flow throughout each year.
Moody's projects that ADS will generate in excess of $150 million
in free cash flow in fiscal years 2023 and 2024 ending March 31.
ADS has no material maturities over the next four years and access
to a sizeable $600 million revolving credit facility.
The stable outlook reflects Moody's expectation that ADS will
continue to benefit from ongoing demand in the domestic
construction market, the major contributor to the company's
revenue. A very good liquidity profile and conservative financial
policies further support the stable outlook.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade of ADS ratings could ensue if end markets remain
supportive of organic growth such that debt-to-EBITDA is below 2.0x
and EBITDA margin is near 25%. Upwards rating movement also
requires preservation of the company's very good liquidity profile,
a capital structure that ensures maximum financial flexibility and
continuing conservative financial policies.
A downgrade could occur if ADS's debt-to-EBITDA is above 3.5x or
the company experiences a permanent contraction in operating
performance. Negative rating pressures would also result if the
company adopts a more aggressive financial strategy, particularly
with respect to share repurchases and acquisitions, or experiences
a weakening of liquidity.
The principal methodology used in this rating was Manufacturing
published in September 2021.
ADVANCED DRAINAGE: S&P Assigns 'B+' Rating on Sr. Unsecured Notes
-----------------------------------------------------------------
S&P Global Ratings assigned its 'B+' issue-level rating to Advanced
Drainage Systems Inc.'s (ADS) proposed $500 million senior
unsecured notes. The 'B+' rating on its existing $350 million
senior unsecured notes is unchanged. The proposed notes will rank
pari passu with these notes. ADS will use the proceeds for general
corporate purposes and to pay down revolver borrowings. The 'BB+'
issue level rating on the company's first-lien term loan B due 2026
is unchanged.
ADS recently increased its revolving credit facility due in 2027 by
$250 million to $600 million (unrated).
S&P said, "Our 'BB+' issuer credit rating and positive outlook on
ADS are also unchanged. Despite the increased debt, we expect
credit metrics will remain in line with our expectations, including
debt to EBITDA in the 2x-3x range over the next 12 months supported
by strong earnings."
ISSUE RATINGS - RECOVERY ANALYSIS
Key analytical factors
-- S&P assesses recovery prospects based on a reorganization value
of approximately $1.24 billion, reflecting an emergence EBITDA of
$249 million and 5x multiple.
-- These assumptions consider a rebound in profitability following
the sharp cyclical downturn, leading to default. S&P's EBITDA
assumption does not represent a default-level EBITDA, which it
thinks could be substantially lower.
-- The 5x multiple is within the 5x-6x range S&P generally uses
for building products companies.
-- S&P's simulated default scenario considers a default in 2026
stemming from a downturn in Advanced Drainage's end markets
(infrastructure spending) and a combination of significantly
reduced state and local infrastructure maintenance budgets and
heightened competition, particularly by larger, better-capitalized
companies. Eventually, the company's liquidity and capital
resources become strained to the point it cannot continue to
operate absent a default, after which we would assume a
reorganization.
Simulated default assumptions
-- Year of default: 2026
-- EBITDA at emergence: about $249 million
-- Implied enterprise valuation (EV) multiple: 5x
-- Gross EV: $1.24 billion
Simplified waterfall
-- Net EV (after 5% administrative costs): about $1.18 billion
-- Total collateral value for secured claims: about $1.14 billion
-- Total secured claim: about $936 million
--Recovery expectation for term loan: 90%-100% (rounded
estimate: 95%)
-- Total value available for unsecured claims: $246 million
-- Total unsecured claims: $876 million
--Recovery expectation for notes: 10%-30% (rounded estimate:
25%)
-- Estimated claim amounts include about six months of accrued but
unpaid interest.
AGILON ENERGY: Unsecureds' Recovery "Unknown" in Joint Plan
-----------------------------------------------------------
Agilon Energy Holdings II, LLC, et al., submitted a Third Amended
Combined Disclosure Statement and Joint Chapter 11 Plan dated May
31, 2022.
The Plan has been amended to incorporate a settlement with the
Committee for the benefit of Holders of Allowed General Unsecured
Claims. As amended, the Committee now supports the Plan and urges
all Holders of Allowed General Unsecured Claims to vote in favor of
the Plan, or to change their vote against the Plan into a vote in
favor of the Plan.
Class 5 consists of General Unsecured Claims. Except to the extent
that the Holder of an Allowed General Unsecured Claim agrees to a
different treatment, such Holder, as a Litigation Trust
Beneficiary, shall receive, in full and final satisfaction,
settlement, release and discharge of, and in exchange for, such
Allowed General Unsecured Claim, a pro rata share of the Litigation
Trust Beneficial Interests, which shall entitle such Holder to a
pro rata Distribution from the Cash proceeds, if any, of the
Retained Claims and Causes of Action (net of Litigation Trust
Expenses), after the later of (a) the Effective Date, and (b) the
date such General Unsecured Claim becomes an Allowed Claim.
For the avoidance of doubt, each Holder of a Prepetition Senior
Secured Deficiency Claim shall share pro rata in the Litigation
Trust Beneficial Interests. To the extent that there are net Cash
proceeds of the Retained Claims and Causes of Action to distribute
from and after the Effective Date, the Litigation Trustee shall
distribute such Cash to the Plan Administrator to be held in trust
for, and promptly distributed ratably to, the Litigation Trust
Beneficiaries after receipt of any Cash for such purpose from the
Litigation Trustee.
The estimated recovery for General Unsecured Claims is "unknown at
this time."
Recoveries to Holders of Allowed General Unsecured Claims are
dependent on the outcome of net recoveries, if any, from the
Retained Claims and Causes of Actions. Such outcome is speculative
and uncertain at this time, according to a footnote in the
Disclosure Statement.
On the Effective Date, the Plan will be funded by the Cash
Collateral of the Prepetition Senior Secured Parties in accordance
with the Wind-down Budget, including the Distribution to the
Prepetition Senior Secured Parties of all Cash of the Debtors and
the Estates not otherwise allocated pursuant to the Wind-down
Budget, and the contribution by the Debtors and the Estates to the
Litigation Trust of the Litigation Trust Initial Cash and the
Retained Claims and Causes of Action otherwise subject to the
Adequate Protection Claims and liens of the Prepetition Senior
Secured Parties.
The Debtors propose a Distribution of the Residual Sale Proceeds
pursuant to a waterfall consistent with the priorities established
under the Bankruptcy Code and this Plan, which is further enhanced
by the Debtors' agreement to contribute the Retained Claims and
Causes of Action to the Litigation Trust for the benefit of the
Litigation Trust Beneficiaries, free and clear of liens securing
the Adequate Protection Claim of the Prepetition Senior Secured
Parties.
A continued hearing to consider the final approval of the
Disclosure Statement and confirmation of the Plan has been set for
June 7, 2022, at 2:30 p.m., in Courtroom 404, United States
Courthouse, 515 Rusk Street, Houston, Texas (the "Confirmation
Hearing").
Any objection to the modifications reflected in the Third Amended
Combined Disclosure Statement and Joint Chapter 11 Plan may be
filed on or before June 6, 2022, by 5:00 p.m.
A full-text copy of the Third Amended Combined Disclosure Statement
and Plan dated May 9, 2022, is available at https://bit.ly/3mfjj9e
from Stretto, the claims agent.
Attorneys for the Agilon Energy Holdings II LLC, et al.:
Elizabeth M. Guffy, Esq.
Simon R. Mayer, Esq.
LOCKE LORD LLP
600 Travis St., Suite 2800
Houston, TX 77002
Telephone: (713) 226-1200
Facsimile: (713) 223-3717
Email: eguffy@lockelord.com
simon.mayer@lockelord.com
About Agilon Energy Holdings II
Texas-based power producer Agilon Energy Holdings II, LLC, and its
affiliates, Victoria Port Power LLC and Victoria City Power LLC,
sought Chapter 11 protection (Bankr. S.D. Tex. Lead Case No.
21-32156) on June 27, 2021. At the time of the filing, Agilon had
between $100 million and $500 million in both assets and
liabilities.
Judge Marvin Isgur oversees the cases.
The Debtors tapped Locke Lord, LLP as legal counsel, Grant
Thornton, LLP as financial advisor and Hugh Smith Advisors, LLC as
restructuring advisor. Hugh Smith of Hugh Smith Advisors serves
as the Debtors' chief restructuring officer. Stretto is the claims
and noticing agent.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on July 30,
2021.
Pachulski Stang Ziehl & Jones, LLP serves as the committee's legal
counsel and Conway MacKenzie, LLC, its financial advisor.
ALEXANDRIA HOSPITALITY: Byline Questions Sale Plan
--------------------------------------------------
Byline Bank objects to Alexandria Hospitality Partners, LLC's
Amended Chapter 11 Disclosure Statement.
Byline objects to Debtor's Amended Disclosure Statement for several
reasons, including:
* The Amended Disclosure Statement is premised entirely on a
sale of the Property to a third party. However, once again, Debtor
fails to attach a sale contract, provide the material terms of the
proposed sale, or provide proof of financing from the proposed
buyer.
* The Debtor does not provide any details as to its marketing
efforts that have been ongoing for "quite some time" prior to the
filing of this case. In fact, Debtor has never even sought Court
approval to retain a broker to market the Property for sale.
* The Debtor fails to include sufficient information
demonstrating Debtor will be able to make the contemplated Plan
payments; Debtor understates the amounts due and owing to Byline
as, to the extent the sale results in proceeds in excess of
Byline's secured claim, Byline is further secured and ultimately
should be secured up to the balance of its Loan.
* The Amended Disclosure Statement states that the unsecured
portion of Byline's claim will be set off against any amount
recovered in Guarantors' Reconventional Demand pending against
Byline, and that any remainder shall be canceled. Debtor does not
provide any basis or authority for this provision, which would
obviously directly affect Byline's interests.
Attorneys for the Byline Bank:
Richard A. Rozanski, Esq.
RICHARD A. ROZANSKI, APLC
P.O. Box 13199
Alexandria, LA 71315-3199
Telephone: (318) 445-5600
E-mail: richard@rarlaw.net
About Alexandria Hospitality
Alexandria Hospitality Partners, L.L.C., was formed in 2013 to
purchase the hotel located at 2211 North MacArthur Drive,
Alexandria, Louisiana.
Alexandria Hospitality Partners filed a Chapter 11 petition (Bankr.
W.D. La. Case No. 21-80242) on June 23, 2021. In the petition
signed by Martin W. Johnson, managing member, the Debtor estimated
up to $50,000 in assets and $10 million to $50 million in
liabilities. The Hon. Stephen D. Wheelis is the case judge. THOMAS
R. WILLSON, led by Thomas R. Willson, is the Debtor's counsel.
ALL YEAR HOLDINGS: Remaining Unsecureds Will Get 11% to 17% in Plan
-------------------------------------------------------------------
All Year Holdings Limited filed with the U.S. Bankruptcy Court for
the Southern District of New York a Disclosure Statement for
Chapter 11 Plan of Reorganization dated May 31, 2022.
The Debtor was established and incorporated on September 17, 2014,
as a British Virgin Islands ("BVI") business company under the laws
of the BVI. The Debtor operates as a holding company that, through
its direct and indirect subsidiaries, focuses on the development,
construction, acquisition, leasing and management of residential
and commercial income producing properties in Brooklyn, New York.
The Debtor, through its subsidiaries, owns approximately 110
properties (including properties under development), consisting of
over 1,000 residential and commercial units in Bushwick,
Williamsburg, and Bedford-Stuyvesant. The Company's most valuable
assets include, without limitation, the William Vale hotel, a
luxury hotel in Williamsburg (the "William Vale"), and, until
recently, the Denizen, a luxury rental complex in Bushwick (the
"Denizen").
Following a robust sales and marketing effort, the Debtor entered
into an Investment Agreement, dated March 11, 2022 (as amended on
April 21, 2022 and May 27, 2022, and as may be further amended,
modified, or supplemented, and together with all schedules and
exhibits thereto, "Investment Agreement"), with Paragraph Partners
LLC (the "Sponsor"), among others, to implement a comprehensive
restructuring of the Debtor and present a path forward for the
Debtor's successful emergence from chapter 11. The Investment
Agreement is the cornerstone of, and is to be implemented pursuant
to, the Plan.
The Investment Agreement provides that, in exchange for one hundred
percent of the equity of the reorganized Debtor (the "Reorganized
Debtor"), the Sponsor will contribute $60,000,000 to the Debtor,
which is comprised of (a) $40,000,000 in cash and (b) promissory
notes in the aggregate amount of $20,000,000. The amount of (i) the
promissory notes will increase to $22,000,000 and (ii) the cash
contribution may increase by an additional $200,000, if the
Sponsor, or an affiliate of the Sponsor, consummates a transaction
involving the William Vale hotel.
Importantly, as part of the Investment Agreement, the Sponsor has
agreed to assume all unsecured claims against the Debtor other than
the Claims of holders of the Debtor's various series of notes (the
"Notes" and the holders thereof, "Noteholders") and certain other
discrete categories of Claims. Mishmeret Trust Company Ltd., as
trustee for the Noteholders(the "Notes Trustee"), is a party to
certain provisions of the Investment Agreement and has
preliminarily consented to the Debtor's entry into the Investment
Agreement.
Following confirmation of the Plan, the Debtor intends to seek
recognition of the Plan and the Confirmation Order in the Israeli
Recognition Proceeding. In addition, the Debtor will seek authority
from the BVI Court to implement a plan of arrangement (the "BVI
Plan of Arrangement") following which, and subject to the
occurrence of the Plan Effective Date, among other things, (i) the
existing Equity Interests in the Debtor will be cancelled, and (ii)
one hundred percent of the equity in the Reorganized Debtor will be
held by the Sponsor.
Class 3 consists of General Unsecured Claims. Except to the extent
that a holder of a General Unsecured Claim against the Debtor
agrees to less favorable treatment, the legal, equitable, and
contractual rights of the holders of Allowed General Unsecured
Claims are unaltered by the Plan. On and after the Effective Date,
the Reorganized Debtor shall continue to satisfy, dispute, pursue,
or otherwise reconcile General Unsecured Claims in the ordinary
course of business. This Class is unimpaired. This Class will
receive a distribution of 100% of their allowed claims.
Class 4 consists of Remaining Unsecured Claims. Each such holder
shall receive (i) on the Effective Date, from the Disbursing Agent
(on behalf of the Debtor), its Pro Rata Share of the Class 4 ED
Distribution, (ii) in the event the William Vale Purchase occurs
subsequent to the Effective Date, from the Disbursing Agent (on
behalf of the Debtor), its Pro Rata Share of any additional New
Notes issued, and (iii) on such other date(s) as determined from
time to time by the Plan Administrator, from Wind-Down Co, the
amounts recovered, if any, from the Excluded Assets (including, but
without limitation, from the prosecution of Avoidance Actions and
other Causes of Action) and any remaining Wind Down Cash Funding.
This Class is impaired. This Class will receive a distribution of
11-17% of their allowed claims.
Class 6 consists of Equity Interests. On or after the Effective
Date, and subject to consummation of the BVI Plan of Arrangement
and any other necessary approvals in the BVI Proceeding, all Equity
Interests in the Debtor shall be cancelled. The existing holder of
the Equity Interests in the Debtor shall neither receive nor retain
any property of the Debtor or interest in property of the Debtor on
account of such Equity Interest.
On the Effective Date, in accordance with the Plan and the
Investment Agreement, subject to the satisfaction or waiver of all
applicable conditions under the terms thereof, the Sponsor shall:
(i) provide the Sponsor Contribution; and (ii) be the sole
shareholder of the Reorganized Debtor, and on the Effective Date,
shall hold 100% of the NewCo Shares free and clear of all Claims
and Liens.
On the Effective Date, in accordance with the Plan and the
Investment Agreement, subject to the satisfaction or waiver of all
applicable conditions under the terms thereof, the Disbursing Agent
(on behalf of the Debtor) shall distribute Pro Rata the Class 4 ED
Distribution to (i) the holders of Remaining Unsecured Claims that
are Allowed as of the Effective Date, and (ii) the Disbursing
Agent, to be held in the Class 4 Disputed Claims Reserve, on behalf
of holders of Disputed Remaining Unsecured Claims.
A full-text copy of the Disclosure Statement dated May 31, 2022, is
available at https://bit.ly/3NTFM7m from PacerMonitor.com at no
charge.
Attorneys for the Debtor:
Gary Holtzer, Esq.
Jacqueline Marcus, Esq.
Matthew P. Goren, Esq.
Weil Gotshal & Manges, LLP
767 Fifth Avenue
New York, NY 10153
Tel: (212) 310-8000
Fax: (212) 310-8007
Email: gary.holtzer@weil.com
jacqueline.marcus@weil.com
matthew.goren@weil.com
About All Year Holdings
All Year Holdings Ltd. is a real estate development company founded
by American real estate developer Yoel Goldman. It operates as a
holding company, which, through its direct and indirect
subsidiaries, focuses on the development, construction,
acquisition, leasing and management of residential and commercial
income producing properties in Brooklyn, N.Y. The company's
portfolio includes approximately 1,648 residential units and 69
commercial units in Bushwick, Williamsburg, and
Bedford-Stuyvesant.
All Year Holdings sought Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 21-12051) on Dec. 14, 2021. At the time of the
filing, the Debtor listed $1 billion to $10 billion in assets and
liabilities. Judge Martin Glenn oversees the case.
Weil, Gotshal & Manges LLP, led by Matthew Paul Goren, Esq., is the
Debtor's legal counsel.
ALL YEAR HOLDINGS: Will Transfer Equity for $60 Million
-------------------------------------------------------
Daniel Gill of Bloomberg Law reports that All Year Holdings, a
bankrupt developer of Brooklyn luxury hotel The William Vale, filed
a Chapter 11 plan that centers on an investor group assuming
ownership of all equity shares for $60 million.
Paragraph Partners LLC, a special purpose company led by healthcare
executive Avi Philipson, will invest in $40 million in cash and $20
million in promissory notes, according to the disclosure statement
All Year filed May 31 in the U.S. Bankruptcy Court for the Southern
District of New York. The investment total could tick up if the
deal includes The William Vale hotel.
About All Year Holdings Ltd.
All Year Holdings Ltd. is a real estate development company founded
by American real estate developer Yoel Goldman. It operates as a
holding company, which, through its direct and indirect
subsidiaries, focuses on the development, construction,
acquisition, leasing and management of residential and commercial
income producing properties in Brooklyn, N.Y. The company's
portfolio includes approximately 1,648 residential units and 69
commercial units in Bushwick, Williamsburg, and
Bedford-Stuyvesant.
All Year Holdings sought Chapter 11 bankruptcy protection (Bankr.
S.D.N.Y. Case No. 21-12051) on Dec. 14, 2021. At the time of the
filing, the Debtor listed $1 billion to $10 billion in assets and
liabilities. Judge Martin Glenn oversees the case.
Weil, Gotshal & Manges LLP, led by Matthew Paul Goren, Esq., is the
Debtor's legal counsel. Meridian Capital Group LLC and its
broker-dealer affiliate, Tigerbridge Capital LLC d/b/a/ Meridian
Securities, is the Debtor's exclusive real estate finance broker.
ARMSTRONG FLOORING: Court OKs June Auctions for Assets
------------------------------------------------------
The Bankruptcy Court approved proposed bidding procedures for
Armstrong Flooring's assets, setting separate auctions for the
North American assets and the foreign assets.
On May 13, 2022, the Debtors filed a motion seeking, among other
things, (a) entry of an order approving the bidding procedures for
the sale or disposition of certain or all of the Debtors' assets in
one or more sale transactions pursuant to 11 U.S.C. Section 363;
(b) establishing procedures for the Debtors to designate a stalking
horse bidder and to enter into a stalking horse
agreement containing bid protections; (c) establishing certain
dates and deadlines for the sale process.
On May 31, 2022 the bankruptcy court for the district of Delaware
approved the proposed Bidding Procedures.
The Bidding Procedures provide interested parties with the
opportunity to qualify for and participate in an auction and to
submit competing bids for the Assets. The Debtors shall assist
Potential Bidders in conducting their respective due diligence
investigations and will accept bids (i) until June 14, 2022 at
11:59 p.m. (prevailing Eastern Time) for the North American Assets
and (ii) until June 23, 2022, at noon (prevailing Eastern Time) for
the assets or equity of the Debtors' affiliates in Australia and
China, separate and apart from the North American Assets.
June 16, 2022 is the auction for the North American Assets. June
22, 2022 at 2:30 p.m. EDT is the commencement of NA Sale Hearing.
June 27, 2022 at noon EDT is the auction for Australian or Chinese
Assets.
June 29, 2022 at 3:00 p.m. EDT is the commencement of AC Sale
Hearing.
The Debtors, as they may reasonably determine to be in the best
interests of their estates may select a Stalking Horse Bidder or
Stalking Horse Bidders for the Assets (or one or more subgroupings
of Assets) for the purposes of establishing one or more Stalking
Horse Bids. The Stalking Horse bidders will may be entitled to a
Break-Up Fee and Expense Reimbursement. The amount of any
consensual Break-Up Fee and the Expense Reimbursement Amount shall,
in the aggregate, not exceed 3% of the cash portion of the
applicable Transaction Purchase Price3 for such Stalking Horse
Bid.
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) is a global leader in the
design and manufacture of innovative flooring solutions that
inspire beauty wherever your life happens. Headquartered in
Lancaster, Pennsylvania, Armstrong Flooring continually builds on
its resilient, 150-year legacy by delivering on its mission to
create a stronger future for customers through adaptive and
inventive solutions. The company safely and responsibly operates
seven manufacturing facilities globally, working to provide the
highest levels of service, quality, and innovation to ensure it
remains as strong and vital as its 150-year heritage. On the Web:
http://www.armstrongflooring.com/
Armstrong Flooring Inc. sought Chapter 11 bankruptcy protection
(Bankr. D. Del. Lead Case No. 22-10426) on May 9, 2022. In the
petition filed by Michel S. Vermette, as president and chief
executive officer, Armstrong Flooring disclosed total assets
amounting to $517,000,000 and estimated total liabilities of
$317,800,000.
The case is assigned to Honorable Bankruptcy Judge Mary F.
Walrath.
The Company is represented in this matter by Skadden, Arps, Slate,
Meagher & Flom LLP as legal advisor, Houlihan Lokey Capital Inc. as
its investment bank, and Riveron RTS, LLC as financial advisor.
Groom Law Group, Chartered is the benefits counsel, Friedman Kaplan
Seiler & Adelman LLP is the conflicts counsel, and Robert A. Weber,
Esq. and Aidan T. Hamilton, Esq. are the efficiency counsel. Epiq
Corporate Restructuring, LLC, is the claims advisor.
ART & ANTIQUES: Has Cash Collateral Access Thru June 25
-------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Tennessee
authorized Art & Antiques Worldwide Media, LLC to use cash
collateral on a final basis in accordance with the budget, with a
10% variance from May 26 to June 25, 2022.
The Court held that the lien of WebBank c/o CAN Capital Bank, Inc.,
as Servicer, on the collateral securing the debt owed will extend
to the Debtor's postpetition assets to the same extent the lien
existed as of the Petition Date. Nothing in the Order will be
deemed to grant WebBank a post-petition lien on the types of
assets, if any, in which WebBank did not possess a valid,
perfected, enforceable, and otherwise non-avoidable pre-petition
lien(s). The post-petition lien and security interest provided will
survive the term of the Order to the extent that the pre-petition
lien was valid, perfected, enforceable, and non-avoidable as of the
Petition Date.
If any or all of the provisions of the Order are modified, vacated
or stayed by any subsequent order of the Bankruptcy Court or any
other court, such stay, modification or vacation will not affect
the validity or enforceability of any security interest, lien or
priority authorized or created prior to the effective date of such
modification, stay, vacation or final order to the extent that said
security interest, lien or priority is valid, perfected,
enforceable and otherwise non-avoidable as of the Petition Date.
The validity and enforceability of all security interests, liens
and priorities authorized or created in the Order will survive the
conversion of the case to a proceeding under Chapter 7 of the
Bankruptcy Code or the dismissal of the proceeding.
A copy of the order and the Debtor's 30-day budget is available at
https://bit.ly/3x5F1RR from PacerMonitor.com.
The Debtor projects $48,642 in total receipts and $51,423 in total
expenses.
About Art & Antiques Worldwide Media, LLC
Art & Antiques Worldwide Media, LLC sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. E.D.N.C. Case No.
22-00598-5) on March 18, 2022. In the petition signed by Phillip
Troy Linger, manager, the Debtor disclosed up to $100,000 in assets
and up to $1 million in liabilities.
Judge David M. Warren oversees the case.
George Mason Oliver, Esq., at The Law Offices of Oliver & Cheek,
PLLC is the Debtor's counsel.
BFCD PROPERTIES: Court Approves Disclosure Statement
----------------------------------------------------
Judge Henry W. Van Eck has entered an order approving the
Disclosure Statement of BFCD Properties, LLC.
July 26, 2022, at 9:30 AM in the Bankruptcy Courtroom, Third Floor,
The Ronald Reagan Federal Building, Third and Walnut Streets,
Harrisburg, Pennsylvania, is fixed for the hearing on confirmation
of the Plan.
July 6, 2022, is fixed as the last day for filing and serving
written objections to confirmation of the Plan.
July 6, 2022, is fixed as the last day for submitting written
acceptances or rejections of the Plan to Kara Gendron, Debtor's
counsel at the following address: Mott & Gendron Law, 125 State
Street, Harrisburg, PA 17101.
July 13, 2022, is fixed as the last day to file with the Court a
tabulation of ballots accepting or rejecting the Plan.
About BFCD Properties
BFCD Properties, LLC, sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. M.D. Pa. Case No. 21-01127) on May
18, 2021, listing $100,001 to $500,000 in both assets and
liabilities. Judge Henry W. Van Eck oversees the case. The Weiss
Law Group, LLC, and Mott & Gendron Law serve as the Debtor's legal
counsel.
BIOSTAGE INC: Raises $5M in Financing to Advance Clinical Trial
---------------------------------------------------------------
Biostage, Inc. has raised approximately $5.1 million from new and
existing investors in a private placement of its shares.
The funds will be used to accelerate the clinical development of
Biostage's lead product candidate, the Biostage Esophageal Implant,
or BEI. The FDA has approved a ten-patient phase one and phase two
clinical trial to study the repair of damage to the esophagus in
adults caused by cancer or injury. The FDA has indicated a
willingness to consider expanding this clinical trial to include
pediatric subjects with birth defects in the esophagus once the
safety of the implant is shown in adults. Hence, the Company
expects the repair of birth defects in the esophagus to be an
additional indication for which Biostage will seek FDA approval.
Biostage is also developing other uses of its technology such as
for treating cancer of the lung using the Biostage Bronchial
Implant. Similar to how the BEI could be used to regenerate the
esophagus, the Biostage Bronchial Implant would be used to
regenerate a bronchus that has been surgically removed to treat
bronchial cancer, injury or birth defects.
Biostage's Interim Chief Executive Officer, Director and Chairman,
David Green stated, "I am very pleased to welcome our new strategic
investors and to thank our existing investors for their continued
support. We look forward to making Biostage a success both for its
patients and shareholders."
Details of the Private Placement
On May 12, 2022, the Company entered into Securities Purchase
Agreements with certain investors pursuant to which the Investors
agreed to purchase in a private placement an aggregate of 854,771
shares of common stock and warrants to purchase 427,390 shares of
common stock, subject to adjustment as provided in the warrant
agreement, for the aggregate purchase price of $5.1 million with a
purchase price per unit of $5.92. Each unit consisted of one share
of common stock and a warrant to purchase one half of one share of
common stock, subject to adjustment, as provided in the Warrants.
The Company has received an aggregate of $4.8 million gross
proceeds from the Private Placement through May 12, 2022, and
expects to receive the remaining subscription amounts in the
aggregate of $260,000 promptly following such date.
The Warrants have an exercise price of $8.88 per share, subject to
adjustments, as provided under the terms thereof, and are
immediately exercisable. The Warrants are exercisable until five
years from the issuance date.
The Warrants have certain adjustment provisions, including
adjustments at the election of the holder that are triggered in the
event that the Company closes a registered public offering within
six months following the date of the warrants. If such public
offering includes warrants, then the holder of the Warrant can
elect to adjust the exercise price of the Warrant to match the
exercise price of the warrant issued in the public offering, and
the shares subject to the Warrant in relation to the warrant
coverage in the public offering. If such public offering does not
include warrants but is closed with a price per share lower than
the price per share in the Private Placement, then the holder of
the Warrant can elect to adjust the shares subject to the Warrant
pursuant to a formula utilizing the difference between the price
per share in the Private Placement and the price in the public
offering, as well as the Black-Scholes value of a certain warrant
at such time.
About Biostage
Holliston, Massachusetts-based Biostage, Inc. -- www.biostage.com
-- is a clinical-stage biotech company that uses cell therapy to
regenerate organs inside the human body to treat cancer, trauma and
birth defects. The Company has performed the world's first
regeneration of an esophagus in a human cancer patient. This
surgery was performed at Mayo Clinic and was published in August
2021.
Biostage reported a net loss of $7.98 million for the year ended
Dec. 31, 2021, compared to a net loss of $4.87 million for the year
ended Dec. 31, 2020. As of March 31, 2022, the Company had
operating cash on-hand of $0.7 million. The Company used net cash
in operations of $0.5 million during the quarter ended March 31,
2022.
Flushing, New York-based Wei, Wei & Co., LLP, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated March 31, 2022, citing that the Company has suffered
recurring losses from operations, has an accumulated deficit, uses
cash flows in its operations, and will require additional
financing
to continue to fund its operations. This raises substantial doubt
about the Company's ability to continue as a going concern.
BOUCHARD TRANSPORTATION: Judge Backs $4.2M Fee for Losing Bidder
----------------------------------------------------------------
Rick Archer of Law360 reports that a Texas bankruptcy judge is
backing a bankruptcy court order allowing a $4.2 million payment to
the losing bidder in the Chapter 11 auction of Bouchard
Transportation Co.'s oil barge fleet, saying its bid drove up the
final price and justified Bouchard's promise to pay the fee.
In a ruling Tuesday, May 31, 2022, District Court Judge Lee
Rosenthal said the evidence showed that the decision by Bouchard's
board of directors to accept a stalking horse bid from Hartree
Partners with the condition it pay a "breakup fee" and expense
reimbursements if Hartree lost the auction had resulted in more
money for creditors.
About Bouchard Transportation
Founded in 1918, Bouchard Transportation Co., Inc.'s first cargo
was a shipment of coal. By 1931, Bouchard acquired its first oil
barge. Over the past 100 years and five generations later, Bouchard
has expanded its fleet, which now consists of 25 barges and 26 tugs
of various sizes, capacities and capabilities, with services
operating in the United States, Canada and the Caribbean.
Bouchard and certain of its affiliates sought Chapter 11 protection
(Bankr. S.D. Tex. Lead Case No. 20-34682) on Sept. 28, 2020. At the
time of the filing, the Debtors estimated assets of between $500
million and $1 billion and liabilities of between $100 million and
$500 million.
Judge David R. Jones oversees the cases.
The Debtors tapped Kirkland & Ellis LLP, Kirkland & Ellis
International LLP and Jackson Walker LLP as their legal counsel;
Portage Point Partners, LLC as restructuring advisor; Jefferies LLC
as investment banker; Berkeley Research Group, LLC as financial
advisor; and Grant Thornton, LLP as tax consultant. Stretto is the
claims agent.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtors' cases. The committee tapped
Ropes & Gray LLP as bankruptcy counsel, Clyde & Co US LLP as
maritime counsel, and Berkeley Research Group LLC as financial
advisor.
BRAZORIA HYDROCARBON: Ordered to File Motion to Modify Plan
-----------------------------------------------------------
Judge Jeffrey Norman has entered an order denying the motions of
Brazoria Hydrocarbon, LLC, to approve its Disclosure Statement.
The Debtor is instructed to file a motion to modify the Chapter 11
Plan and self-calendar the same for hearing.
This is a confirmed Chapter 11 case that appears not to be
substantially consummated. While the Court did not hear evidence,
from a docket review of operating reports, the appearance is that
the debtor is failing to make the payments to creditors that are
required under the confirmed plan.
Such plan as modified under this subsection becomes the plan only
if circumstances warrant such modification and the court, after
notice and a hearing, confirms such plan as modified. The
proponent of a modification shall also comply with Section 1125 of
title 11.
The Court finds that the filed three pleadings fail to provide
sufficient information as to the circumstances that warrant the
modification and that the disclosures required by Section 1125 of
"adequate information" are insufficient. This does not require the
debtor to "reinvent the wheel" as a Chapter 11 Plan and Disclosure
Statement have already been approved by the Court. However, it
does require the debtor to file a Motion to Modify and then
indicate what has occurred since the plan was confirmed, what
circumstances that have changed, why these changed circumstances
warrant a modification, and to update any required financial
statements.
About Brazoria Hydrocarbon
Brazoria Hydrocarbon, LLC, is a private company in Hempstead,
Texas, in the hydrocarbon gases business.
Brazoria Hydrocarbon sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D. Tex. Case No. 19-32170) on April 17,
2019. At the time of the filing, the Debtor had estimated assets
of between $1 million and $10 million and liabilities of between $1
million and $10 million. The case has been assigned to Judge
Jeffrey P Norman. The Debtor is represented by The Law Office of
Margaret M. McClure.
No official committee of unsecured creditors has been appointed in
the Debtor's case.
BRIGHT MOUNTAIN: Delays Filing of First Quarter Form 10-Q
---------------------------------------------------------
Bright Mountain Media, Inc. filed a Form 12b-25 with the Securities
and Exchange Commission with respect to its Quarterly Report on
Form 10-Q for the period ended March 31, 2022.
The Company said its Form 10-Q could not be filed within the
prescribed time because additional time is required by the
Company's management and auditors to prepare certain financial
information to be included in such report. The Company is working
diligently to complete the necessary work and make such filing.
The Company has yet to file its Annual Report on Form 10-K for the
year ended Dec. 31, 2021.
About Bright Mountain
Based in Boca Raton, Fla., Bright Mountain Media, Inc. --
www.brightmountainmedia.com -- is an end-to-end digital media and
advertising services platform, efficiently connecting brands with
targeted consumer demographics. In addition to its corporate
website, the Company owns and/or manages 24 websites which are
customized to provide its niche users, including active, reserve
and retired military, law enforcement, first responders and other
public safety employees with products, information and news that
the Company believes may be of interest to them. The Company also
owns an ad network which was acquired in September 2017.
Bright Mountain reported a net loss of $72.71 million for the year
ended Dec. 31, 2020, a net loss of $4.17 million for the year ended
Dec. 31, 2019, and a net loss of $5.22 million for the year ended
Dec. 31, 2018. As of June 30, 2021, the Company had $31.58 million
in total assets, $31.26 million in total liabilities, and $315,466
in total shareholders' equity.
East Brunswick, New Jersey-based WithumSmith+Brown, PC, the
Company's auditor since 2021, issued a "going concern"
qualification in its report dated Dec. 23, 2021, citing that the
Company has suffered recurring losses from operations and has a net
capital deficiency that raise substantial doubt about its ability
to continue as a going concern.
BUILDERS FIRSTSOURCE: Moody's Rates $600MM Unsecured Notes 'Ba2'
----------------------------------------------------------------
Moody's Investors Service assigned a Ba2 rating to Builders
FirstSource, Inc.'s (BLDR) proposed $600 million senior unsecured
notes due 2032. Proceeds from the new notes and cash on hand will
be used to redeem the company's senior secured notes due 2027, at
which time the Ba1 rating on these notes will be withdrawn, and to
pay the call premium and other fees and expenses. Moody's expects
the terms and conditions of the proposed senior unsecured notes to
be similar to BLDR's existing senior unsecured notes. All the
unsecured notes are pari passu. BLDR's Ba1 Corporate Family Rating
and Ba1-PD Probability of Default Rating are not affected by the
proposed transaction. Also, the Ba2 ratings on BLDR's existing
unsecured notes are not impacted by the proposed transaction. The
company's speculative grade liquidity rating is maintained at
SGL-1. The outlook is stable.
Moody's views the proposed transaction as credit positive since
BLDR's debt maturity profile is improving in essentially a
leverage-neutral transaction. BLDR has no maturities over the next
four and a half years. The company's $1.8 billion asset based
revolving credit facility (unrated) expires in December 2026
followed by its senior unsecured notes due March 2030.
"Builders FirstSource has considerable financial flexibility with
an extended debt maturity profile," said Peter Doyle, Vice
President at Moody's. "The greatest risk facing the company today
is the inevitable contraction in the domestic homebuilding sector,"
added Doyle.
Assignments:
Issuer: Builders FirstSource, Inc.
Senior Unsecured Regular Bond/Debenture, Assigned Ba2 (LGD5)
RATINGS RATIONALE
BLDR's Ba1 CFR reflects Moody's expectation that the company will
continue to generate good profitability, with EBITDA margin
sustained at least in the range of 13% - 14% over the next two
years. High profitability should translate into low leverage, with
adjusted debt-to-EBITDA remaining low at 1.3x through 2023. As the
largest rated lumber distributor in North America BLDR will
continue to benefit from good growth opportunities over the next
two years for the US Homebuilding sector, from which BLDR derives
about 83% of its revenue.
However, stretched affordability due to robust home price
appreciation and rising interest rates, inflation pressures,
reduced disposable income and stock market volatility are risks
that will contribute to moderation in demand conditions for the
domestic housing sector. The domestic homebuilding industry
experienced significant cyclicality in the past, which is BLDR's
greatest credit challenge. Also, BLDR will continue to enhance
shareholder returns through share repurchases, which BLDR has about
$2 billion in remaining authorization. This is capital that could
otherwise be deployed towards enhancing liquidity for potential
acquisitions or for debt reduction.
BLDR's SGL-1 Speculative Grade Liquidity Rating reflects Moody's
view that the company will maintain a very good liquidity profile
over the next two years, generating free cash flow throughout each
year. Moody's projects that BLDR will generate in excess of $1.0
billion in free cash flow in each of the next two years. BLDR has
no near-term maturities and access to a sizeable revolving credit
facility.
The stable outlook reflects Moody's expectation that BLDR will
continue to benefit from ongoing demand in the US residential
construction market, the main driver of BLDR's revenue. A very good
liquidity profile and conservative financial policies further
support the stable outlook.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade of BLDR's ratings could ensue if end markets remain
supportive of organic growth such that debt-to-EBITDA is below 2.0x
and EBITDA margin is above 15%. Upwards rating movement also
requires preservation of the company's very good liquidity profile,
a capital structure that ensures maximum financial flexibility and
continuing conservative financial policies.
A downgrade could occur if BLDR's debt-to-EBITDA is above 3.0x.
Negative rating pressures would also result if the company
experiences a weakening of liquidity, or adopts a more aggressive
financial strategy, particularly with respect to share repurchases
and acquisitions.
The principal methodology used in this rating was Distribution &
Supply Chain Services Industry published in June 2018.
Builders FirstSource, Inc., headquartered in Dallas, Texas, is the
largest national distributor of lumber, trusses, millwork, and
other building products and a provider of construction services.
CAMBER ENERGY: Antilles Family Holds 9.99% Equity Stake
-------------------------------------------------------
Antilles Family Office, LLC disclosed in a Schedule 13G filed with
the Securities and Exchange Commission that as of May 12, 2022, it
beneficially owns 39,939,450 shares of common stock of Camber
Energy, Inc., representing 9.99 percent of the shares outstanding.
The reporting person holds 1,575 shares of Series C Preferred Stock
of the issuer, each of which is convertible into 10,000 shares of
common stock of the issuer. Pursuant to the Certificate of
Designations for the preferred, a Stock Purchase Agreement and a
Settlement Agreement with the issuer approved by an Order on Joint
Motion for Approval of Settlement entered by the United States
District Court for the Southern District of Texas, 4:22-CV-755 on
May 16, 2022, the reporting person cannot vote any common or
preferred shares except as requested by the board of directors of
the issuer, and the issuer may not issue common shares to the
reporting person that would result in the reporting person and its
affiliates beneficially owning more than 9.99% of all common stock
outstanding immediately after giving effect to such issuance. The
number of shares and percent of class stated above are calculated
based upon 399,794,291 total shares outstanding as of May 16,
2022.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/1309082/000121390022028555/ea160096-13gantilles_camber.htm
About Camber Energy
Based in Houston, Texas, Camber Energy -- http://www.camber.energy
-- is primarily engaged in the acquisition, development and sale of
crude oil, natural gas and natural gas liquids from various known
productive geological formations, including from the Hunton
formation in Lincoln, Logan, Payne and Okfuskee Counties, in
central Oklahoma; the Cline shale and upper Wolfberry shale in
Glasscock County, Texas; and Hutchinson County, Texas, in
connection with its Panhandle acquisition which closed in March
2018.
Camber Energy reported a net loss attributable to the company of
$169.68 million for the year ended Dec. 31, 2021, compared to a net
loss attributable to the company of $52.01 million for the nine
months ended Dec. 31, 2020. As of Dec. 31, 2021, the Company had
$46.40 million in total assets, $118.22 million in total
liabilities, and a total stockholders' deficit of $71.81 million.
Dallas, Texas-based Turner, Stone & Company, L.L.P., the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated May 19, 2022, citing that the Company has a
significant working capital deficiency, has incurred significant
losses and needs to raise additional funds to meet its obligations
and sustain its operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
CAMBER ENERGY: Incurs $264.6 Million Net Loss in Q3 2021
--------------------------------------------------------
Camber Energy, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
attributable to the company of $264.56 million on $103,191 of oil
and gas sales for the three months ended Sept. 30, 2021, compared
to a net loss attributable to the company of $19.99 million on
$57,458 of oil and gas sales for the same period in 2020.
For the nine months ended Sept. 30, 2021, the Company reported a
net loss attributable to the company of $246.50 million on $266,082
of oil and gas sales compared to a net loss attributable to the
company of $41.63 million on $180,046 of oil and gas sales for the
nine months ended Sept. 30, 2020.
As of Sept. 30, 2021, the Company had $32.78 million in total
assets, $198.31 million in total liabilities, and a total
stockholders' deficit of $165.53 million.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/Archives/edgar/data/1309082/000147793222003693/cei_10q.htm
About Camber Energy
Based in Houston, Texas, Camber Energy -- http://www.camber.energy
-- is primarily engaged in the acquisition, development and sale of
crude oil, natural gas and natural gas liquids from various known
productive geological formations, including from the Hunton
formation in Lincoln, Logan, Payne and Okfuskee Counties, in
central Oklahoma; the Cline shale and upper Wolfberry shale in
Glasscock County, Texas; and Hutchinson County, Texas, in
connection with its Panhandle acquisition which closed in March
2018.
Camber Energy reported a net loss attributable to the company of
$169.68 million for the year ended Dec. 31, 2021, compared to a net
loss attributable to the company of $52.01 million for the nine
months ended Dec. 31, 2020. As of Dec. 31, 2021, the Company had
$46.40 million in total assets, $118.22 million in total
liabilities, and a total stockholders' deficit of $71.81 million.
Dallas, Texas-based Turner, Stone & Company, L.L.P., the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated May 19, 2022, citing that the Company has a
significant working capital deficiency, has incurred significant
losses and needs to raise additional funds to meet its obligations
and sustain its operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
CAMBER ENERGY: Posts $62.8 Million Net Income in Q2 2021
--------------------------------------------------------
Camber Energy, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing net income
attributable to the company of $62.84 million on $97,238 of oil and
gas sales for the three months ended June 30, 2021, compared to a
net loss attributable to the company of $13.63 million on $33,689
of oil and gas sales for the three months ended June 30, 2020.
For the six months ended June 30, 2021, the Company reported net
income attributable to the company of $18.06 million on $162,891 of
oil and gas sales compared to a net loss attributable to the
company of $21.64 million on $122,588 of oil and gas sales for the
same period in 2020.
As of June 30, 2021, the Company had $25 million in total assets,
$55.45 million in total liabilities, and a total stockholders'
deficit of $30.45 million.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/Archives/edgar/data/1309082/000147793222003691/cei_10q.htm
About Camber Energy
Based in Houston, Texas, Camber Energy -- http://www.camber.energy
-- is primarily engaged in the acquisition, development and sale of
crude oil, natural gas and natural gas liquids from various known
productive geological formations, including from the Hunton
formation in Lincoln, Logan, Payne and Okfuskee Counties, in
central Oklahoma; the Cline shale and upper Wolfberry shale in
Glasscock County, Texas; and Hutchinson County, Texas, in
connection with its Panhandle acquisition which closed in March
2018.
Camber Energy reported a net loss attributable to the company of
$169.68 million for the year ended Dec. 31, 2021, compared to a net
loss attributable to the company of $52.01 million for the nine
months ended Dec. 31, 2020. As of Dec. 31, 2021, the Company had
$46.40 million in total assets, $118.22 million in total
liabilities, and a total stockholders' deficit of $71.81 million.
Dallas, Texas-based Turner, Stone & Company, L.L.P., the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated May 19, 2022, citing that the Company has a
significant working capital deficiency, has incurred significant
losses and needs to raise additional funds to meet its obligations
and sustain its operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
CANO HEALTH: All Four Proposals Passed at Annual Meeting
--------------------------------------------------------
Cano Health, Inc. held its 2022 annual meeting of stockholders at
which the stockholders:
(1) elected Dr. Lewis Gold, Barry S. Sternlicht and Solomon D.
Trujillo as Class I directors, each to serve on the Company's Board
of Directors for a three-year term and until their respective
successors are duly elected and qualified;
(2) approved on a non-binding advisory basis, the compensation
of the Company's named executive officers;
(3) approved, on an advisory, non-binding basis, a resolution to
hold future advisory vote on executive compensation every year;
and
(4) ratified the appointment of Ernst & Young LLP as the
Company's independent registered public accounting firm for the
year ending Dec. 31, 2022.
About Cano Health
Cano Health (NYSE: CANO) -- canohealth.com -- is a primary
care-centric, technology-powered healthcare delivery and population
health management platform designed with a focus on clinical
excellence.
Cano Health reported a net loss of $116.74 million in 2021, a net
loss of $71.06 million in 2020, and a net loss of $19.78 million in
2019. As of March 31, 2022, the Company had $2.17 billion in total
assets, $1.33 billion in total liabilities, and $837.78 million in
total stockholders' equity.
CARS.COM INC: S&P Alters Outlook to Positive, Affirms 'B+' ICR
--------------------------------------------------------------
S&P Global Ratings revised the outlook on Cars.com Inc. to positive
from stable and affirmed the 'B+' issuer credit rating. At the same
time, S&P affirmed its 'B+' issue-level rating on the company's
senior unsecured notes.
The positive outlook reflects S&P's view that Cars.com is
well-positioned to benefit from organic revenue and EBITDA growth
such that it could lower its leverage toward the mid-3x area in the
next 12 months, despite its appetite for share repurchases and
acquisitions.
The positive outlook reflects S&P's view that the company's S&P
Global Ratings-adjusted gross leverage could decline below the
upgrade threshold of 3.75x in the next 12 months.
Although recent acquisitions and earn-out considerations increased
leverage to 4.3x for the 12-month-period ended March 31, 2022, from
3.5x as of Dec. 31, 2021, we assume subsequent decline in leverage
to the mid-3x area in 2023 due to mandatory debt repayment and
continued EBITDA growth led by stable demand from car dealerships,
improved pricing, and moderate recovery to original equipment
manufacturer (OEM) and national advertising revenue.
S&P said, "We expect steady operating performance resulting from
increased demand for digital solutions by dealer customers offset
in part by economic headwinds and supply chain constraints. We
expect the company will exhibit steady revenue growth over the next
12 months from increased dealer count and rise in ARPD. Dealer
count of 19,500 as of March 31, 2022, exceeded its previous
watermark point of 19,300 dealers in March 31, 2019, which included
more than 3,000 affiliate dealer customers. Dealer customer count
is growing on the back of stable traffic to online marketplace over
the past few quarters while the number of unique visits has grown,
despite inventory shortage of new cars. We believe ARPD has grown
due to greater market penetration of the company's digital
offerings and increased cross-selling opportunities. We assume ARPD
will continue to grow as dealers continue to prioritize digital
offerings in a post-COVID-19 environment."
However, growth could be offset in part in an economic downturn due
to high macroeconomic uncertainty. OEM spending on marketing and
promotions has declined because of constrained new car production
stemming from supply-demand imbalance of semiconductor chips,
leading to advertising revenue from OEMs declining more than 20% in
the quarter ended March 31, 2022, compared with the quarter ended
March 31, 2020. S&P said, "Although we expect supply chain
constraints to alleviate in 2023, a recession could further delay
recovery in OEM national advertising revenue. A recession could
also weigh on consumer sentiment and propensity to spend on high
value items, though we believe car sales and Cars.com's marketplace
offerings to remain resilient from pent-up demand and high auto
pricing."
S&P said, "We expect strong cash flow generation to lead to
leverage improvement, despite the financial policy appetite for
share repurchases and acquisitions. The company repaid $120 million
of its term loan in 2021 leading to improvement in leverage to 3.5x
in 2021. The company's leverage for the last-12--month period as of
March 31, 2022, increased to 4.3x, reflecting additional earn-out
considerations for the Accu-Trade acquisition in February 2022. We
expect leverage to decline to about 4x in 2022 and to the mid-3x
area in 2023 from strong cash flow generation, EBITDA growth, and
continued debt paydown. We expect the company to generate about
$115 million to $130 million of reported free operating cash flow
(FOCF) in 2022 and 2023, similar to 2021 levels. However, we expect
the company to also deploy a portion of its excess cash to fund
share repurchases ($195 million remaining as of March 31, 2022,
under its $200 million share repurchase program authorized February
2022) and future acquisitions, like with CreditIQ and Accu-Trade."
Integration of digital acquisitions key priority over next 12
months although execution risks could pressure EBITDA margins.
Cars.com has grown to be a digital solution provider alongside
being a digital marketplace for its dealers over the past couple of
years. S&P said, "We assume the recent acquisitions of CreditIQ and
Accu-Trade along with established products like Dealer Inspire and
FUEL could generate recurring revenue for the company. We believe
integration of these digital acquisitions be a key priority this
year." However, these acquisitions introduce execution risk for the
company and could result in high technical and marketing spending
pressuring EBITDA margins for the period.
Cars.com participates in a fragmented and competitive industry,
though stickiness of dealers offset exposure to the cyclical new
car sales. Cars.com faces significant competition in a fragmented
industry with larger and better-capitalized players. The online
auto marketplaces include CarGurus, TrueCar, AutoTrader.com Inc.,
Edmunds, and online dealers such as Carvana Co. and Vroom. In
addition, eBay Inc. and Facebook Inc. provide broader horizontal
marketplaces with sizable communities of vehicle buyers and dealers
advertising on their platforms.
The company generates more than 88% of its revenue from its dealer
segment which includes its marketplace for new and used vehicles
and website platforms for dealerships that depend on subscription
relationships with dealers. The company has shifted to a SaaS model
that generates sticky revenue from dealerships and could offset the
volatility of revenue stream from the OEM and national segments
which are more exposed to economic cyclicality of auto sales.
S&P said, "The positive outlook reflects our view that Cars.com is
well-positioned to benefit from organic revenue and EBITDA growth
such that it could lower its leverage toward the mid-3x area in the
next 12 months, despite its appetite for share repurchases and
acquisitions."
S&P could revise the outlook to stable over the next 12 months if
leverage remains in the 4x area likely due to:
-- Dealer subscription losses and reduced website traffic stemming
from a weakening recessionary economic environment or increased
competition; or
-- Execution missteps from integrating recent acquisitions like
CreditIQ and Accu-Trade; or
-- Further decline in OEM national advertising; or
-- Large debt-financed acquisitions, share repurchases, or
dividends.
S&P could raise the rating on Cars.com over the next 12 months if:
-- The company continues to achieve healthy organic revenue and
EBITDA growth; and
-- Leverage declines and remains below 3.75x on a sustained basis,
including any impact to credit metrics from investments,
acquisitions, and share repurchases.
ESG credit indicators: E-2, S-2, G-2
ESG factors have no material influence on our credit rating
analysis of Cars.com.
CDK GLOBAL: Moody's Assigns B2 CFR & Rates New First Lien Loans B1
------------------------------------------------------------------
Moody's Investors Service assigned CDK Global, Inc. (new) (CDK) a
B2 corporate family rating and a B2-PD probability of default
rating. In addition, Moody's assigned a B1 rating to the company's
new senior secured first lien term loan and revolving credit
facility and a Caa1 rating to the company's new senior secured
second lien term loan and delayed draw term loan. Moody's also
downgraded the ratings of the company's unsecured note obligations
that remain outstanding following a tender offer in connection with
the LBO of the company to Caa1 from Ba1. This concludes Moody's
review for downgrade on those debt instruments that commenced on
April 8, 2022. Ratings for the existing CDK Global, Inc. rated
entity remain under review for downgrade and will be withdrawn
following the close of this transaction. The outlook is stable.
Proceeds from the first and second lien term loans together with
other first lien secured debt and over $3.4 billion of new sponsor
equity will fund the acquisition of CDK by Brookfield Business
Partners.
"CDK Global's debt-to-EBITDA will be very high following the LBO
and annual cash interest expense will exceed $300 million," said
Brian Silver, Vice President at Moody's. "However, we expect EBITDA
growth and debt repayment from more than $125 million of free cash
in fiscal 2023 will present opportunity to quickly reduce
leverage," continued Silver.
Assignments:
Issuer: CDK Global, Inc. (new)
Corporate Family Rating, Assigned B2
Probability of Default Rating, Assigned B2-PD
Senior Secured 1st Lien Term Loan, Assigned B1 (LGD3)
Senior Secured 2nd Lien Term Loan, Assigned Caa1 (LGD6)
Senior Secured 2nd Lien Delayed Draw Term Loan, Assigned Caa1
(LGD6)
Senior Secured Multi Currency Revolving Credit Facility, Assigned
B1 (LGD3)
Downgrades:
Issuer: CDK Global, Inc. (new)
Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1 (LGD6)
from Ba1 (LGD4)
Outlook Actions:
Issuer: CDK Global, Inc. (new)
Outlook, Assigned Stable
Governance is material factor in the ratings assignment as Moody's
expects CDK to operate with high financial leverage and employ an
active acquisition strategy to grow its business.
RATINGS RATIONALE
The rating reflect CDK's very high leverage. Pro forma debt-to-LTM
EBITDA at March 31, 2022 is high at 7.7 times assuming half of the
company's expected synergies are realized (6.9 times if all
expected synergies are realized). However, Moody's expects
debt-to-EBITDA to improve to around 6.0 times over the next 12-18
months driven by both EBITDA growth and debt repayment. Moody's
also expects CDK to remain acquisitive in search of future
value-added layered application offerings for its flagship CDK
Drive DMS.
CDK Global Inc.'s ratings also reflect its solid market position as
a provider of subscription-based technology and services to
automotive retail dealers via its dealer management systems ("DMS")
and complementary layered software applications. Although
concentrated in the mature North American auto dealership market
CDK's revenue base is broad representing more than 15,000 dealer
locations. Moody's expects CDK's revenue growth will be supported
by annual price escalators contained in subscription-based
multi-year DMS contracts as well as increased sales of layered
applications. Moody's also expects CDK's EBITDA margin to expand
from various margin improvement initiatives implemented by new
ownership following several years of increased investment in the
business that suppressed profitability but benefitted CDK
operationally.
Moody's expects CDK to have good liquidity, supported by over $125
million of free cash flow in FY2023 (June 30 fiscal year end) and
access to a new $650 million 5-year revolving credit facility that
will be undrawn at the close of the transaction.
The stable outlook reflects Moody's expectation that CDK's
profitability will grow, which together with debt repayment, will
reduce debt-to-EBITDA below 7 times by the end of FY2023.
The proposed first lien term loan is not expected to contain
financial maintenance covenants while the proposed revolving credit
facility will contain a springing maximum first lien net leverage
ratio to be set with at least a 40% cushion to credit agreement
defined consolidated EBITDA that will be tested when the revolver
is more than 40% drawn at the end of the quarter. The new credit
facilities are expected to contain aggressive covenant flexibility
that could adversely affect creditors, including the omission of
certain material lender protections.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if CDK continues to grow its size and
scale, is able to sustain debt-to-EBITDA below 5.5 times and
EBITA-to-interest above 3.0 times. CDK would also be expected to
maintain good liquidity for an upgrade.
The ratings could be downgraded if there is a decline in CDK's
dealership subscriber base, debt-to-EBITDA increases from pro-forma
levels, EBITA-to-interest falls below 1.5 times, or if the company
makes a large debt funded acquisition and/or dividend. In addition,
if liquidity weakens the ratings could be downgraded.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
CDK Global, Inc., (CDK) headquartered in Hoffman Estates, IL, is a
leading provider of integrated data and technology solutions to the
automotive, heavy truck, recreation and heavy equipment industries.
The company provides software solutions to original equipment
manufacturers and over 5,600 customers representing more than
15,000 dealer locations in North America. CDK's flagship dealer
management system software solutions provides enterprise resource
planning tools that help facilitate the sale of new and used
vehicles, consumer financing, repair and maintenance services, and
vehicle and parts inventory management.
CDK GLOBAL: S&P Downgrades ICR to 'B+' on Leveraged Buyout
----------------------------------------------------------
S&P Global Ratings lowered issuer credit rating on Hoffman Estates,
Ill.-based U.S. auto dealer information technology (IT) solutions
provider CDK Global Inc. to 'B+' from 'BB+'.
S&P said, "In addition, we lowered our unsecured notes issue-level
and recovery ratings to 'B-' and '6' respectively, from 'BB+' and
'3'. We assigned 'B+' and '3' issue-level and recovery ratings to
the new first-lien credit facility.
"The stable outlook reflects our expectation CDK will continue to
grow organic revenues in the mid-single-digit-percent area
annually. We forecast its EBITDA margins will expand toward the
mid-30% area, resulting in annual free operating cash flow
generation of about $150 million."
CDK will be acquired by Brookfield Business Partners for about $8
billion. The transaction will be funded with a new first-lien term
loan, other first-lien secured debt, a privately placed second-lien
term loan (not rated), and common equity.
S&P said, "The ratings downgrade reflects the significant increase
in financial leverage following the take-private transaction.
Following the leveraged buyout, S&P Global Ratings pro forma
adjusted leverage will rise and remain above 7x through 2023, from
about 3x. We forecast leverage will decline toward the high-6x area
in 2024 if the company successfully executes against its margin
improvement program, pricing, and service extension initiatives.
While we forecast some leverage improvement in the near term, we
expect leverage to remain high over our forecast period. Given the
company's modest organic revenue growth trajectory, its
deleveraging is primarily dependent on the successful realization
of the margin improvements identified.
"Our view of CDK's financial risk profile also reflects its
financial-sponsor ownership, and our observation that financial
sponsors often maintain elevated leverage levels to maximize their
investment returns.
"We believe CDK's margin improvement initiatives are likely to
drive a near-term increase in profitability; however, successful
execution of the business strategy is a key credit consideration.
We forecast CDK's adjusted EBITDA margins will expand by over 400
basis points to over 35% over the next two years as the company
streamlines its cost structure. We think the margin improvement
plan outlined is aggressive as it targets a significant portion of
the cost base. Nevertheless, the company's ability to execute on
the savings appears feasible. Prospects for successful realization
are supported by Brookfield's demonstrated record executing against
similar programs. The savings are primarily tied to headcount
reduction and offshoring, initiatives that we view as having
relatively low risks to execution."
S&P's ratings reflect the risk for potential deterioration in
customer service levels, which could limit CDK's ability to achieve
its base-case expectation for mid-single-digit-percent annual
organic revenue growth. Most of the planned margin improvements
target customer-facing functions. CDK's historical margin
improvement initiatives have preceded declines in net promoter
scores and site counts.
Elevated interest expense, costs to achieve savings, and ongoing
litigation-related expenses will weigh on CDK's cash flow going
forward. CDK's free operating cash flow (FOCF) credit metrics will
weaken significantly following the leveraged buyout. S&P forecasts
FOCF to debt will decline to about 3%-4% annually in 2023 and 2024,
from the mid-teens-percent area, as the company incurs incremental
annual interest expense of about $300 million, and expenses to
achieve its savings program. In addition, the company faces various
legal claims that could result in a material use of cash beyond our
base-case expectation.
Disruption in the traditional automotive dealership business model
will continue to drive dealership site consolidation; however, CDK
remains well positioned in the medium term. The North American auto
dealership market is likely to steadily consolidate over time as
the industry shifts toward a digital retailing model. S&P believes
CDK's focus on larger dealerships that drive consolidation through
the acquisition of smaller dealers should enable the company to
continue modest site growth. CDK has invested heavily to modernize
its offerings and solidify its leading market position among larger
dealerships. It has invested over $1 billion since 2018 to acquire
enhanced customer relationship management, digital retailing, data
analytics, and auto insurance technology solutions, and in its view
these investments support CDK's competitive standing relative to
peers Cox Automotive and Reynolds & Reynolds, which focus on
smaller dealerships. Faster growth among large dealerships could
increase the concentration of CDK's revenues among key customers
over time, however revenues currently remain well-diversified, and
no single customer contributes more than 4% of revenues.
S&P said, "The stable outlook reflects our expectation CDK will
continue to grow organic revenues in the mid-single digit area
annually despite modest dealership site consolidation. We forecast
its EBITDA margins will expand toward the mid-30% area, resulting
in annual free operating cash flow generation of about $150 million
and pro forma adjusted leverage reduction to about 7x over the next
12 months."
S&P could lower its ratings if CDK's competitive advantage
deteriorates, or if it maintains pro forma adjusted leverage above
7x or if free operating cash flow to debt declines below 3% This
could result if:
-- Operational missteps significantly delay realization of the
targeted margin improvements;
-- Adoption of Roadster is slower than expected because of
increased competition from traditional players and startups with
cloud-native solutions;
-- Higher investments are required to remain competitive;
-- CDK engages in debt-funded mergers and acquisitions that S&P
views as nonaccretive, or large debt-funded dividends; or
-- Acceleration in unfavorable shifts in the dealership model
reduce demand for CDK's offerings, resulting in sustained site
declines or lower revenue per site.
S&P could raise its rating on CDK if the company alters its
financial policy and sustains adjusted leverage below 5x. This
could occur if the company:
-- Successfully upsells applications resulting in mid- to
high-single-digit-percent organic revenue growth;
-- Repays debt using proceeds from additional asset sales;
-- Increases EBITDA margins ahead of S&P's expectations by
overachieving outlined margin improvements; or
-- Gains visibility into the new auto dealership model.
ESG credit indicators: E-2; S-2; G-3
Governance is a moderately negative consideration, as it is for
most rated entities owned by private-equity sponsors. S&P believes
the company's highly leveraged financial risk profile points to
corporate decision-making that prioritizes the interests of the
controlling owners. This also reflects private-equity sponsors'
generally finite holding periods and focus on maximizing
shareholder returns.
CHARMING CHARLIE: Amends Unsecured Claims Pay; Plan Hearing July 20
-------------------------------------------------------------------
Charming Charlie Holdings Inc., and its Debtor Affiliates submitted
a Disclosure Statement for the Amended Joint Chapter 11 Plan of
Liquidation dated May 31, 2022.
The Debtors believe that the Plan will enable them to accomplish
the objectives of an orderly liquidation of the Debtors' assets and
maximize creditor recoveries, and that acceptance of the Plan is in
the best interest of the Debtors' Estates and Holders of Claims.
Accordingly, the Debtors urge the Holders of Claims entitled to
vote to accept or reject the Plan to vote to accept the Plan.
Plan Transactions
On the Effective Date, or as soon as reasonably practicable
thereafter, the Debtors may take all actions as may be necessary or
appropriate to effect any transaction described in, approved by,
contemplated by, or necessary to effectuate the Plan (the "Plan
Transactions"), including: (a) the execution and delivery of any
appropriate agreements or other documents of merger, consolidation,
restructuring, conversion, disposition, transfer, dissolution, or
liquidation containing terms that are consistent with the terms of
the Plan, and that satisfy the requirements of applicable law and
any other terms to which the applicable Entities may agree;(b) the
execution and delivery of appropriate instruments of transfer,
assignment, assumption, or delegation of any asset, property,
right, liability, debt, or obligation on terms consistent with the
terms of the Plan and having other terms for which the applicable
parties agree; (c) rejection or assumption, or assumption and
assignment, as applicable, of Executory Contracts and Unexpired
Leases; (d) the filing of appropriate certificates or articles of
incorporation, reincorporation, merger, consolidation, conversion,
or dissolution pursuant to applicable state law; and (e) the
consummation of the transactions contemplated by the WARN
Settlement.
Class 4 consists of all General Unsecured Claims. Each Holder of an
Allowed General Unsecured Claim shall receive its Pro Rata share of
the General Unsecured Creditor Recovery up to payment in full of
such Holder's Allowed General Unsecured Claim. Claims in Class 4
are Impaired. The allowed unsecured claims total $76.5 million.
This Class will receive a distribution of 0.0% - 0.5% of their
allowed claims. Each Holder of a General Unsecured Claim will be
entitled to vote to accept or reject.
The Debtors' Cash on hand and any other Cash received or generated
by the Debtors or Plan Administrator, as applicable, shall be used
to fund the distributions to Holders of Allowed Claims against the
Debtors in accordance with the treatment of such Claims.
The Confirmation Hearing is scheduled to commence on July 20, 2022,
at 2:00 p.m. before the Honorable Judge Mary F. Walrath, in
Courtroom #4, 5th floor of the United States Bankruptcy Court for
the District of Delaware, 824 North Market Street, Wilmington,
Delaware 19801.
The deadline to vote to accept or reject the Plan is July 11, 2022,
at 4:00 p.m., (the "Voting Deadline"). All objections to the Plan
must be filed by July 11, 2022, at 4:00 p.m.
Co-Counsel to the Debtors:
Matt Murphy
Nathan S. Gimpel
Matthew Smart
PAUL HASTINGS LLP
71 South Wacker Drive, Suite 4500
Chicago, Illinois 60606
Telephone: (312) 499-6036
Facsimile: (312) 499-6100
Domenic E. Pacitti, Esq.
Michael W. Yurkewicz, Esq.
KLEHR HARRISON HARVEY BRANZBURG LLP
919 N. Market Street, Suite 1000
Wilmington, DE 19801
Tel: (302) 426-1189
Fax: (302) 426-9193
About Charming Charlie Holdings
Charming Charlie -- http://www.CharmingCharlie.com/ --is a
Houston-based specialty retailer focused on fashion jewelry,
handbags, apparel, gifts and beauty products. The Company
currently operates more than 375 stores in the United States and
Canada.
Charming Charlie Holdings Inc. and its affiliates sought Chapter 11
protection (Bankr. D. Del. Lead Case No. 17-12906) on Dec. 11,
2017.
Charming Charlie estimated assets of $50 million to $100 million
and debt of $100 million to $500 million.
Kirkland & Ellis LLP is serving as the Company's legal counsel,
AlixPartners LLP is serving as its restructuring advisor, and
Guggenheim Securities, LLC is serving as its investment banker.
Klehr Harrison Harvey Branzburg LLP is the Company's local
counsel.
Rust Consulting/OMNI Bankruptcy is the claims and noticing agent.
Joele Frank, Wilkinson Brimmer Katcher is the Company's
communications consultant. A&G Realty Partners, LLC's the
Company's real estate advisors.
Hilco Merchant Resources LLC is the Company's exclusive agent.
CNBX PHARMACEUTICALS: Effects 1-for-120 Reverse Stock Split
-----------------------------------------------------------
CNBX Pharmaceuticals Inc. filed a certificate of change with the
Secretary of State of the State of Nevada. Pursuant to the
Certificate, the Company (i) effectuated a 1:120 reverse split of
the issued and outstanding shares of common stock of the Company
without changing the par value of the stock and (ii) decreased its
authorized shares of preferred stock from 100,000,000 to 5,000,000.
The Corporate Actions took effect at 12:00 a.m., Nevada time, on
May 12, 2022.
Effective as of the opening of market trading on May 12, 2022, the
Company's common stock commenced trading on the OTCQB on a
post-split basis under the symbol CNBXD. The new CUSIP number for
the Company's common stock following the Reverse Split is
13764M209.
About CNBX Pharmaceuticals
CNBX Pharmaceuticals Inc. is a U.S. public company and a global
developer of cancer related cannabinoid-based medicine. The
Company's R&D is based in Israel, where it is licensed by the
Ministry of Health to conduct scientific and clinical research on
cannabinoid formulations and cancer. For more information, please
visit www.cannabics.com.
The Company reported a net loss of $3.19 million on zero revenue
for the year ended Aug. 31, 2021, compared to a net loss of $7.47
million on $7,157 of net revenue for the year ended Aug. 31, 2020.
As of Feb. 28, 2022, the Company had $1.14 million in total assets,
$1.79 million in total current liabilities, and a total
stockholders' deficit of $648,028.
Tel-Aviv, Israel-based Weinstein International. C.P.A., the
Company's auditor since 2019, issued a "going concern"
qualification in its report dated Nov. 25, 2021, citing that the
Company has incurred significant losses and needs to raise
additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
COLEMAN COMMERCIAL: Unsecureds to Get 100 Cents on Dollar in Plan
-----------------------------------------------------------------
Coleman Commercial Properties, Inc. filed with the U.S. Bankruptcy
Court for the District of Colorado a Small Business Plan of
Reorganization under Subchapter V dated May 31, 2022.
Since May of 2006, the Debtor has been operating as a sports bar
and grill in Aurora, Colorado. Debtor is owned and operated by
Edward Coleman. The debtor operates as McCarthy Sports Bar &
Grill, located off Smokey Hill Road and Chambers Road.
The ongoing health pandemic resulted in such a substantial loss of
revenue that debtor was unable to maintain its monthly commercial
lease obligation and fell substantially behind on rent with the
landlord. As the Debtor has been forced to pay for a substantial
number of repairs in order to remain open and in compliance with
health and safety requirements due to the age and condition of the
building, the relationship with the landlord was not productive to
working out any form of agreement to resolve the outstanding rents
due.
In January 2022, the landlord moved forward with eviction
proceedings. That prompted Debtor to retain undersigned counsel to
file for Chapter 11 protection under Subchapter 5. Since filing,
the Debtor has undertaken substantial efforts to reduce overhead,
and to make timely payments to creditors. Despite interruptions
with the Covid pandemic, and the closure of the business due to the
water damage, it has remained current with the following costs,
vendors and expenses.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 100 cents on the dollar. This Plan also provides
for the payment of administrative and priority claims.
The final Plan payment is expected to be paid on May 30, 2024.
Class 3 consists of Non-priority unsecured creditors:
* 3A Wells Fargo Bank. Wells Fargo Bank filed unsecured proof
of claim 1 on March 15, 2022 for $169,185.28. Debtor is in the
process of having this payroll protection loan forgiven. Debtor's
plan does not provide for repayment of this loan.
* 3B Shops at Shenandoah LLC. Shops at Shenandoah LLC filed
Proof of Claim 3 on March 24, 2022 for $598,174.32. Pre-petition
arrears of $94,835.37. An order granting Debtor's assumption of the
lease entered on April 14, 2022. Monthly rental payments of $15,404
will resume on April 1, 2022 and will continue until the current
lease expires. Debtor will pay an additional $3,951.50 per month,
commencing June 30, 2022, for a period of 24 months to cure the
$94,835.37 of pre petition arrears.
* 3C Xcel Energy. Xcel Energy filed proof of claim 2 on March
24, 2022 for $2,296.88. Debtor will pay the claim in full
concurrently with on or before May 30, 2022.
The Debtor assumes, and if applicable assigns, the following
executory contracts and unexpired leases as of the effective date:
Shops at Shenandoah.
A full-text copy of the Plan of Reorganization dated May 31, 2022,
is available at https://bit.ly/3PZIwC7 from PacerMonitor.com at no
charge.
Attorney for Debtor:
Stephen E. Berken, 14926
Berken Cloyes, PC
1159 Delaware Street
Denver, CO 80202
303-623-4359
stephenberkenlaw@gmail.com
About Coleman Commercial Properties
Since May of 2006, Coleman Commercial Properties, Inc., has been
operating as a sports bar and grill in Aurora, Colorado. The
company operates as McCarthy Sports Bar & Grill, located off Smokey
Hill Road and Chambers Road. It is owned and operated by Edward
Coleman.
Coleman Commercial Properties, Inc., filed a petition under Chapter
11, Subchapter V of the Bankruptcy Code (Bankr. D. Colo. Case No.
22-10666) on March 1, 2022, listing as much as $1 million in both
assets and liabilities. Mark David Dennis serves as the Subchapter
V trustee.
The Debtor tapped Berken Cloyes PC as legal counsel and Carl J.
Moser as accountant.
COMSTOCK RESOURCES: Moody's Ups CFR to B1, Outlook Remains Stable
-----------------------------------------------------------------
Moody's Investors Service upgraded Comstock Resources, Inc.'s
Corporate Family Rating to B1 from B2, Probability of Default
Rating to B1-PD from B2-PD and senior unsecured notes rating to B2
from B3. Comstock's Speculative Grade Liquidity (SGL) rating is
unchanged at SGL-2. The outlook remains stable.
"Comstock's ratings upgrade reflects debt reduction and our
expectation for further debt reduction and positive free cash flow
over the remainder of 2022 and 2023 supported by strong natural gas
prices and management's demonstrated commitment to debt reduction,"
commented Jonathan Teitel, a Moody's analyst.
Upgrades:
Issuer: Comstock Resources, Inc.
Corporate Family Rating, Upgraded to B1 from B2
Probability of Default Rating, Upgraded to B1-PD from B2-PD
Senior Unsecured Regular Bond/Debenture, Upgraded to B2 (LGD4)
from B3 (LGD4)
Outlook Actions:
Issuer: Comstock Resources, Inc.
Outlook, Remains Stable
RATINGS RATIONALE
Comstock's upgrade to a B1 CFR reflects declining financial
leverage and Moody's expectation of management following through on
further debt reduction and reaching its leverage targets before
increasing shareholder returns. The company's rating incorporates
its geographic concentration in the Haynesville Shale and natural
gas focus, and the benefits of good liquidity and a long-dated debt
maturity profile. Comstock is supported by its large acreage
position, low-cost production and very limited processing needs
because of its dry natural gas production. Comstock benefits from
proximity to Henry Hub which supports low basis differentials. It
also benefits from nearby natural gas demand in the Gulf Coast
region. Comstock's hedging activities improve cash flow visibility
and mitigate risks from natural gas price volatility. Comstock's
high proportion of proved undeveloped reserves provides a large
drilling inventory but requires significant investment to develop.
The company reduced its drilling and completion costs per lateral
foot over the past few years benefitting capital efficiency.
Comstock targets leverage below 1.5x before starting to pay
dividends to shareholders.
Comstock's SGL-2 rating reflects Moody's view that Comstock will
maintain good liquidity through 2023. Comstock has a revolving
credit facility with a $1.4 billion borrowing base that matures in
2024. As of March 31, 2022, the company had $150 million
outstanding on the facility and $12 million of cash on its balance
sheet. In May 2022, Comstock redeemed the remaining $244 million
senior unsecured notes due 2025 using borrowings on the revolver
and cash on the balance sheet. Moody's expects the company to repay
these borrowings out of free cash flow, allowing the revolver to be
paid off before year-end 2022 under current natural gas prices. The
revolver has two financial covenants comprised of a maximum
leverage ratio of 4x and minimum current ratio of 1x. Moody's
expects the company to maintain compliance with these covenants
through 2023.
Comstock's $1.25 billion senior unsecured notes due 2029 and $965
million senior unsecured notes due 2030 are rated B2, one notch
below the CFR, reflecting their effective subordination to the
secured revolver due 2024 (unrated).
The stable outlook reflects Moody's expectation that Comstock will
generate positive free cash flow and reduce leverage over the next
12-18 months while maintaining good liquidity.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Factors that could lead to an upgrade include substantial
additional debt reduction beyond expected repayment of revolver
borrowings; and retained cash flow (RCF) to debt above 35% at
mid-cycle natural gas prices to improve the company's ability to
maintain production and credit metrics through periods of much
weaker natural gas prices.
Factors that could lead to a downgrade include an inability to
generate consistent positive free cash flow and expected debt
reduction; RCF/debt below 25%; weakening liquidity; or aggressive
shareholder distributions.
Comstock, headquartered in Frisco, Texas, is a publicly-traded
independent exploration and production company with operations
focused on the Haynesville Shale. Jerry Jones owns a majority of
the company.
The principal methodology used in these ratings was Independent
Exploration and Production published in August 2021.
CORP GROUP: Plan Deal Signed, Committee Objection Narrowed
----------------------------------------------------------
The Official Committee of Unsecured Creditors of Corp Group Banking
S.A., et al., filed a limited objection to the Fifth Amended Joint
Plan of Liquidation of Corp Group Banking S.A. and its debtor
affiliates.
The Committee has focused from day one in the Chapter 11 cases on
maximizing value for the Debtors' unsecured creditors. In doing
so, the Committee keyed on (1) reviewing and contesting where
appropriate the Debtors' guarantee and pledge obligations in
support of non-Debtor affiliate primary obligors, and (2)
preserving potential estate causes of action, as well as direct
causes of action held by individual creditors, in connection with
significant (and numerous) prepetition transactions. Through
lengthy and contentious, albeit ultimately productive, settlement
negotiations with the Debtors and other parties, the Committee has
narrowed its Plan objections to a single issue: the deemed
Allowance of Non-Recourse Secured Claims held by Banco De Credito E
Inversiones S.A. ("BCI") and Deutsche Bank Trust Company Americas,
as collateral agent ("Collateral Agent").
According to Committee, since the filing of the first Joint Plan of
Liquidation of Corp Group Banking S.A. and its Debtor Affiliates on
Dec. 27, 2021, the Committee's efforts have proved instrumental in:
(a) prompting the Settling Parties to provide consideration for the
Debtors' proposed releases under the Plan, (b) the withdrawal of
the CGB Interhold Intercompany Payable Claim, which decreased the
aggregate unsecured creditors pool of CGB by over $72 million (thus
increasing pro rata recoveries to CGB Unsecured Notes Claims and
other unsecured creditors), (c) allowing creditors to preserve
direct causes of action by opting out of the Plan's third party
releases, and (d) ensuring that the Plan before the Court is
confirmable no matter the outcome of the Court's determination of
the Committee's Standing Motion (defined below) and related claim
objections. And with the Exclusivity Stipulation filed in February
2022, the Committee resolved its outstanding objections to the
treatment of Itau's secured claims under the Plan, thereby
narrowing further the Committee's issues subject to litigation at
Confirmation.
The Committee points out that on June 1, 2022, the Committee, Itau
and the Debtors entered into that certain Stipulation Regarding
Fifth Amended Plan of Liquidation and Related Matters (the "Plan
Stipulation") which, among other things, resolves all outstanding
issues and objections as between the Debtors, the Committee, Itau
and the Settling Parties. Specifically, the Plan Stipulation and
Plan provide for:
* An increase (by $2.5 million) in the principal amount of the
cash short term note provided by the Settling Parties under the SP
Settlement, as well as improved interest payment and other terms;
* Express language ensuring that the Plan releases will not be
used to limit, enjoin, and/or serve as a defense to an Opt-Out
Creditor's assertion of direct causes of action; and
* A settlement with Itau that resolves outstanding (and future)
issues as between Itau and the Committee, which provides for a
capped recovery for Itau from any distributions made from the
Litigation Trust.
The Committee further points out that the above comprehensive
settlement leaves this Limited Objection as the only remaining
matter to be resolved. The Committee believes the Plan should be
confirmed but should be modified to (1) preserve and transfer
colorable fraudulent transfer causes of action against BCI and
Collateral Agent to the Litigation Trust, and (2) deem the proofs
of claim of BCI and Collateral Agent as "Disputed" under the Plan.
Counsel for the Official Committee of Unsecured Creditors of Corp
Group Banking S.A., et al.:
Jamie L. Edmonson, Esq.
Ryan M. Messina, Esq.
ROBINSON & COLE LLP
1201 N. Market Street, Suite 1406
Wilmington, DE 19801
Telephone: (302) 516-1700
E-mail: jedmonson@rc.com
rmessina@rc.com
Rachel Jaffe Mauceri, Esq.
1650 Market Street, Suite 3030
Philadelphia, PA 19103
Telephone: (215) 398-0556
Email: rmauceri@rc.com
- and -
Glenn E. Siegel, Esq.
Jason R. Alderson, Esq.
MORGAN, LEWIS & BOCKIUS LLP
101 Park Ave.
New York, NY 10178
Telephone: (212) 309-6000
E-mail: glenn.siegel@morganlewis.com
jason.alderson@morganlewis.com
Andrew J. Gallo, Esq.
Christopher L. Carter, Esq.
One Federal Street
Boston, MA 02110-1726
Telephone: (617) 341-7700
Email: andrew.gallo@morganlewis.com
christopher.carter@morganlewis.com
About Corp Group Banking S.A.
Corp Group Banking SA, a Chilean financial holding company
controlled by billionaire Alvaro Saieh, and Inversiones CG
Financial Chile Dos SpA filed voluntary petitions for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
21-10969) on June 25, 2021. At the time of the filing, Corp Group
Banking disclosed $500 million to $1 billion in assets and $1
billion to $10 billion in liabilities.
Judge J. Kate Stickles oversees the cases.
The Debtors tapped Simpson Thacher & Bartlett, LLP and Young
Conaway Stargatt & Taylor, LLP as legal counsel. Prime Clerk, LLC
is the Debtors' claims and noticing agent and administrative
advisor.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors on July 20, 2021. The committee tapped Morgan,
Lewis & Bockius, LLP as lead bankruptcy counsel, Robinson & Cole
LLP as Delaware counsel, and NLD Abogados as special Chilean
counsel. FTI Consulting, Inc., serves as the committee's financial
advisor.
The Debtors filed their joint Chapter 11 plan of liquidation and
disclosure statement on Dec. 27, 2021.
CPE FEEDS: Creditors to Get Proceeds From Liquidation
-----------------------------------------------------
CPE Feeds, Inc., filed with the U.S. Bankruptcy Court for the
Northern District of Texas an Original Plan of Liquidation dated
May 31, 2022.
The Debtor is a Texas corporation who was primarily involved in the
business of processing seeds of various plants into both meal and
oil. The Debtor's primary operations immediately preceding the
petition was processing cotton seed, but the Debtor had, in the
past, processed sunflower and other seeds.
Following two devastating fires at its operational facilities, the
Debtor struggled to have sufficient cash flow to purchase the feed
stock (i.e. seed) necessary to economically conduct its operations.
Although the Debtor struggled along by acquiring seed on credit,
that business model ultimately failed.
The Debtor's current assets consist of three (3) parcels of real
property, the Rolling Stock, and various items of personal
property. The Debtor's current operations involve three sources of
revenue: (i) crushing cotton seed for a fee; (ii) storing
cottonseed meal; and (iii) selling oil generated as a by-product of
cotton seed crushing operations.
The Debtor believes that the cotton seed crushing will terminate
when the current load of uncrushed seed that has been delivered to
the Debtor (but remains the property of the Debtor's customer) has
been crushed. Current projections have the cotton seed crushing
ending by approximately June 30, 2022. When the current store of
cotton seed has been crushed, oil producing will likewise cease.
However, storage operations will continue until such time as
terminated by the customer.
Class 1 consists of Any Allowed Secured Claims of ABC Bank and/or
the Elevator Creditors. ABC Bank shall retain all legal, equitable
and contractual rights on account of its Allowed Class 1 Secured
Claim and such Claim shall remain unaltered by the Plan. ABC Bank's
Class 1 Claim shall be in the amount of $1,350,000.00 and ABC Bank
shall have a first position lien against the Real Property –
North Plant, the Real Property – South Plant, and the Remaining
Personal Property to secure its Class 1 Claim.
The Elevator Creditors shall retain all legal, equitable and
contractual rights on account of its Allowed Class 1 Secured Claim
and such Claim shall remain unaltered by the Plan. The Elevator
Creditors' Class 1 Claim shall be in the amount of $80,000.00 and
the Elevator Creditors shall have a first position lien against the
Real Property – Elevator to secure their Class 1 Claim.
Class 2 consists of Any Allowed Priority Non-Tax Claims. In full
and final satisfaction of its Allowed Class 2 Claim, each Holder of
an Allowed Class 2 Priority Non-Tax Claim shall be paid in full on
the Effective Date or as soon thereafter as funds become available
to the Debtor.
Class 3 consists of Any Allowed General Unsecured Claims. Holders
of Allowed Class 3 Claims shall receive a Pro Rata Share of the
Beneficial Interests and subsequent Distributions to the Holders of
Beneficial Interests in accordance with the Plan.
Class 4 consists of Interests in the Debtor. Interests in the
Debtor shall be extinguished.
Since this Plan contemplates the liquidation of the Debtor's
Estate, the Confirmation Order shall contain a provision providing
for the termination and dissolution of the Liquidating Debtor in
accordance with the Texas Business Organizations Code and the
expenses thereof be considered as an Administrative Claim.
A full-text copy of the Liquidating Plan dated May 31, 2022, is
available at https://bit.ly/3zcOU33 from PacerMonitor.com at no
charge.
Proposed Attorney for the Debtor:
Ryan C. Gentry, Esq.
McGowan & McGowan, PC
119 South 6th Street
Brownfield, TX 79316
Tel: (806) 637-7585
Email: Ryan@McGownPC.com
About CPE Feeds
CPE Feeds, Inc., is a privately held company in the animal food
manufacturing business. The company is based in Brownfield,
Texas.
CPE Feeds filed a petition for relief under Subchapter V of Chapter
11 of the Bankruptcy Code (Bankr. N.D. Tex. Case No. 22-50022) on
March 1, 2022, listing as much as $10 million in both assets and
liabilities. Scott M. Seidel serves as Subchapter V trustee.
Judge Robert L. Jones oversees the case.
Ryan C. Gentry, Esq., at McGowan and McGowan, PC, is the Debtor's
legal counsel.
CRUMP ENGINEERING: Case Summary & Three Unsecured Creditors
-----------------------------------------------------------
Debtor: Crump Engineering Inc.
1950 W Corporate Way, Ste 23851
Anaheim, CA 92801
Chapter 11 Petition Date: June 3, 2022
Court: United States Bankruptcy Court
Central District of California
Case No.: 22-10920
Judge: Hon. Scott C. Clarkson
Debtor's Counsel: Kevin Tang, Esq.
TANG & ASSOCIATES
17011 Beach Blvd
Suite 900
Huntington Beach, CA 92647
Tel: (714) 594-7022
Fax: (714) 594-7024
Email: kevin@tang-associates.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Charles Kibbee Crump as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's three unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/TO2HLMA/Crump_Engineering_Inc__cacbke-22-10920__0001.0.pdf?mcid=tGE4TAMA
CTCW-WATERFORD: Case Summary & Four Unsecured Creditors
-------------------------------------------------------
Debtor: CTCW-Waterford East LLC
601 North Mesa
Suite 1900
El Paso, TX 79901
Chapter 11 Petition Date: June 3, 2022
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 22-01989
Debtor's Counsel: Justin M. Luna, Esq.
LATHAM LUNA EDEN & BEAUDINE LLP
201 S. Orange Avenue
Suite 1400
Orlando, FL 32801
Tel: (407) 481-5800
Fax: (407) 481-5801
E-mail: jluna@lathamluna.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dan Kagey as authorized representative.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/BDHTIMI/CTCW-Waterford_East_LLC__flmbke-22-01989__0001.0.pdf?mcid=tGE4TAMA
DIOCESE OF CAMDEN: Cross, Ava Law Update Advise 13 Abuse Claimants
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In the Chapter 11 cases of The Diocese of Camden, New Jersey, the
law firms of Cross & Simon, LLC and AVA Law Group submitted a
second supplemental disclosure under Rule 2019 of the Federal Rules
of Bankruptcy Procedure, to disclose an updated list of Sexual
Abuse Survivor Claimants that they are representing.
Due to confidentiality, each Claimant has been identified by their
Survivor Proof of Claim number assigned by the Clerk of the Court.
The firms have identified 13 claimants with the following
designations:
* FLA-0082
* MKA-0079
* JBS-0063
* LAS-0002
* LEA-0869
* BIS-0125
* HAS-0872
* JBS-0301
* RBS-2900
* MAS-0460
* KAS-0717
* AIS-1364
* RBS-3169
The names and addresses of the confidential claimants are available
to permitted parties who have executed a confidentiality agreement
and have access to the Survivor Proof of Claim Forms.
Pursuant to the individual retainer agreements, AVA was
individually retained by each Claimant to pursue claims for damages
against the Debtor as a result of sexual abuse. This includes
representing and acting on behalf of each Claimant in these
bankruptcy proceedings.
Counsel for AVA Law Group, Inc. can be reached at:
CROSS & SIMON, LLC
Kevin S. Mann, Esq.
1105 North Market Street, Suite 901
Wilmington, DE 19801
Telephone: (302) 777-4200
Facsimile: (302) 777-4224
E-mail: kmann@crosslaw.com
- and -
Andrew Van Arsdale, Esq.
AVA Law Group, Inc.
3667 Voltaire Street
San Diego, CA 92106
Telephone: (866) 428-2529
E-mail: andrew@avalaw.com
A copy of the Rule 2019 filing is available at
https://bit.ly/3m8Rhfh 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.
EL JEBOWL: Bankruptcy Exit Plan Needs Creditors' Blessing
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Rick Carroll of Aspen Times reports that with the amount of money
it owes dwarfing the value of its assets, Bowlski's alley in El
Jebel has proposed a bankruptcy exit plan that hinges on it
remaining in business and receiving creditor approval.
"The Debtor (Bowlski's) believes that the Plan, as proposed, is
feasible," said the proposed plan. "The funding for the Plan will
come from the Debtor's continued operations."
A confirmation hearing for the plan is scheduled July 28 in Denver,
where certain creditors will vote on the plan that also would need
the court's blessing.
Bowlski's declared bankruptcy Jan. 2, 2022 in Denver after a
disagreement with its landlord, Crawford Properties. The Chapter 11
filing "was prompted by a mix of issues," the exit plan said. "The
COVID pandemic caused the shutdown of the business, followed by
operational restrictions, that caused cash flow issues for the
Debtor. The problem was compounded when the sprinkler system at the
Debtor's leased premises failed, causing the business to be shut
down for a period of time. The second shut down further compounded
the cash flow crisis. Moreover, the cash flow issues from the COVID
restrictions left the Debtor with limited cash to handle the shut
down caused by the issues with the leased premise's sprinkler
system."
Attorneys for Crawford Properties, however, have argued in court
filings that Bowlski's was behind on its rent before the pandemic
hit in the spring of 2020.
The proposed plan said Crawford Properties would be paid back
$75,000 over a period of three months, starting one month after the
agreement takes effect. Bowlski's lease with Crawford Properties
dates back to August 2016.
Bowlski's has been able to operate during the bankruptcy using
lender cash, which was court approved. That arrangement expires
July 31, and Bowlski's is seeking the bankruptcy court's approval
to continue another six months with more lender cash, according to
a motion filed Tuesday.
Creditors filing secured claims in the bankruptcy proceedings
include the Colorado Department of Revenue, for $27,922; Veritex
Community Bank, for $352,732; and the SBA, for $158,183, according
to bankruptcy records.
Bowlski's made payments to Veritex Community Bank and the revenue
department, which “during the pendency of the bankruptcy case …
reduced the amount owed to the taxing authority,” according to
the proposed plan.
The plan calls for Bowlski's paying Veritex over a period of 10
years at 6% per annum and paying the revenue department over 5
years at the statutory interest rate.
Bowlski's has just over $200,000 in assets that include machinery
and equipment comprising $183,850 of the sum, the plan said. The
bowling alley’s unsecured debt exceeds $500,000.
"The aggregate of these Secured Claims exceeds the value of the
Debtor’s collateral," the plan said. "Thus, there is no equity in
the Debtor’s assets if such assets were sold in a liquidation."
Unsecured claims against the Bowlski's estate amount to $161,518.
One month after the plan is approved, if that is the result,
Bowlski's will deposit 8% of its gross revenue into an unsecured
creditors account for the first year of the plan. That amount would
increase to 9% the next year, 11% the following year, 12% during
the fourth year and 15% during the fifth year. Creditors would be
paid on a quarterly basis under the plan.
Based on the plan's revenue projections for Bowlski's, the business
would chip away at the debt to unsecured creditors with $88,305 the
first year. That amount will climb annually to $132,111 by the
fifth year.
"The Projections show the Debtor will have sufficient income to
satisfy the payment to creditors after meeting its other expenses,"
the plan said.
Bowlski's has retained legal representation from Wadsworth Garber
Warner Conrardy PC and Law Offices of Kevin S. Neiman.
About El Jebowl LLC
El Jebowl LLC, doing business as Bowlski's, is a bowling aalley in
El Jebel, Colorado.
El Jebowl, LLC sought Chapter 11 protection (Bankr. D. Colo. Case
No. 22-10004) on Jan. 2, 2022, listing up to $100,000 in assets and
up to $500,000 in liabilities. Judge Thomas B. McNamara oversees
the case.
The Law Offices of Kevin S. Neiman, PC and Wadsworth Garber Warner
Conrardy, PC serve as the Debtor's bankruptcy counsels. Sumrall &
Bondy, PC is tapped to provide professional tax and accounting
services.
Veritex Community Bank, as lender, is represented by Markus
Williams Young & Hunsicker LLC.
ENVIA HOLDINGS: Voluntary Chapter 11 Case Summary
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Debtor: Envia Holdings, LLC
91 Norton Ave
San Jose, CA 95126-2908
Business Description: The Debtor is a Single Asset Real Estate (as
defined in 11 U.S.C. Section 101(51B)).
Chapter 11 Petition Date: June 2, 2022
Case No.: 22-50489
Court: United States Bankruptcy Court
Northern District of California
Judge: Hon. M. Elaine Hammond
Debtor's Counsel: Lars Fuller, Esq.
THE FULLER LAW FIRM, PC
60 N Keeble Ave
San Jose, CA 95126-2723
Tel: (408) 295-5595
E-mail: admin@fullerlawfirm.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Nathaniel Villareal as sole member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/AZ6SFCA/Envia_Holdings_LLC__canbke-22-50489__0001.0.pdf?mcid=tGE4TAMA
FAIRPORT BAPTIST: U.S. Trustee Appoints Creditors' Committee
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The U.S. Trustee for Region 2 appointed an official committee to
represent unsecured creditors in the Chapter 11 cases of Fairport
Baptist Homes and its affiliates.
The committee members are:
1. Hilda Thompson
1701 Brace Road
Victor, NY 14564
Phone: (585) 820-5240
Email: jot1248@hotmail.com
2. Philip L. Barcomb
41 Dewey Avenue
Fairport, NY 14450
Phone: (585) 377-8194
Email: philiplbarcomb@gmail.com
3. Denise DeVuyst
389 Kashong Rd.
Geneva, NY 14456
Phone: (585) 727-0247
Email: ddevuyst@rochester.rr.com
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About Fairport Baptist Homes
Fairport Baptist Homes and its affiliates, Fairport Baptist Homes
Adult Care Facility, Inc., FBH Community Ministries and FBH
Distinctive Living Communities, Inc., operate skilled nursing care
facilities.
Fairport Baptist Homes owns a New York-licensed 142-bed residential
health care facility at the FBH campus in Fairport, N.Y., and 42
independent living units known as Deland Acres.
On May 6, 2022, Fairport Baptist Homes and its affiliates sought
Chapter 11 bankruptcy protection (Bankr. W.D.N.Y. Lead Case No.
22-20220). In the petition filed by Fairport President Thomas H.
Poelma, Fairport Baptist Homes listed $1 million to $10 million in
assets and $10 million to $50 million in liabilities.
The Debtors tapped John A. Mueller, Esq., at Lippes Mathias, LLP as
legal counsel and Epiq Corporate Restructuring, LLC as claims and
noticing agent.
FIRST TO THE FINISH: Wins Cash Collateral Access Thru June 14
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Illinois
authorized Michael E. Collins, Chapter 11 Trustee for First to the
Finish Kim and Mike Viano Sports Inc., to use cash collateral on an
interim basis.
The Trustee requires the use of cash collateral to minimize the
disruption of the Debtor's business, operate the business in an
orderly manner, maintain business relationships with vendors,
suppliers, and customers, pay employees, and satisfy other
operational as well as working capital needs.
CNB Bank & Trust, N.A., Nike USA, Inc., and the Bank of Springfield
have asserted a perfected security interest in the Debtor's
bankruptcy estate.
Judge Laura K. Grandy approved the parties' stipulation, and
accordingly, authorized the Trustee to use the cash collateral for
the period through and including the termination date, solely in
accordance with the budget, with a 10% variance.
The termination date will be the earlier of (i) June 14, 2022 (ii)
the entry of an Order, on a "final" basis approving the Trustee's
use of cash collateral; (iii) five business days after notice by
any Secured Lender to the Trustee of any "Termination Event,"
unless within the five business day-period the Trustee has cured
the Termination Event or unless waived by that Secured Lender, (iv)
the date of the dismissal of the Debtor's bankruptcy case or the
conversion of the Debtor's bankruptcy case to a case under Chapter
7 of the Bankruptcy Code, (v) the date a sale of substantially all
of the Estate's assets is consummated after being approved by the
Court, (vi) the effective date of any confirmed chapter 11 plan.
As adequate protection, the Secured Lenders will be granted access
to examine the books and records of the Debtors and take inventory
of the bankruptcy estate assets. In addition, the Secured Lenders
are granted valid and perfected security interests in and lies,
including replacement liens, on all property of the estate, to the
extent of diminution in value of the Secured Lenders' interest in
the prepetition collateral. The Secured Lenders will also have
administrative expense claims against the Debtor's estate.
As further adequate protection, the Chapter 11 Trustee will take
reasonable steps to preserve any and all rights of the Estate in
FTTF Health Supply, LLC from the sale of personal protective
equipment and related items; and seek documentation regarding any
receivables held by FTTF Health Supply, Inc. The Trustee will
provide a copy of any such documentation to the Secured Lenders.
The liens and claims granted to the Secured Lenders are subject to
the carve-out of up to $100,000 for fees owed to the U.S. Trustee;
and fees and expenses incurred by the Case Trustee, his
professionals, and the Debtor's professionals.
The Adequate Protection Liens and the 507(b) claims are valid,
perfected, enforceable, and effective as of the Petition Date
without the need for any further action by the Trustee, the Secured
Lenders, or the necessity of execution or filing of any instruments
or agreements.
A final telephonic hearing on the matter is scheduled for June 9 at
10 a.m.
A copy of the order and the Debtor's budget for the period from
March to May 2022 is available for free at https://bit.ly/3aCt92n
from PacerMonitor.com.
The Debtor projects $225,000 in budgeted cash receipts and $240,589
in total cash disbursements for May 2022.
About First to the Finish Kim
and Mike Viano Sports Inc.
First to the Finish Kim and Mike Viano Sports Inc. sells sporting
goods, hobbies, and musical instruments.
First to the Finish Kim and Mike Viano Sports filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Ill. Case No. 20-30955) on October 7, 2020. The petition was
signed by Mike Viano, president. At the time of filing, the Debtor
estimated $1 million to $10 million in both assets and
liabilities.
Judge Laura K. Grandy oversees the case.
The Debtor is represented by Carmody MacDonald P.C.
The Chapter 11 Trustee, Michael E. Collins, is represented by
Manier & Herod, P.C.
CNB Bank & Trust, N.A., as secured lender, is represented by Silver
Lake Group, Ltd. Nike USA, Inc., also a secured lender, is
represented by A.M. Saccullo Legal, LLC.
FLOOR-TEX COMMERCIAL: Wins Cash Collateral Access Thru June 9
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The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, entered an order extending Floor-Tex Commercial
Flooring, LLC's access to cash collateral to June 9, 2022.
The Court said the Order Authorizing Use of Cash Collateral dated
May 17, 2022, is extended to June 9, 2022, due to the Debtor's
request to reschedule the plan confirmation hearing set for June
6.
The confirmation hearing for the bankruptcy-exit plan under
Subchapter V of Chapter 11 is reset and will occur electronically
on June 9 at 1:30 p.m.
The May 17 Order held that the Cash Collateral Lenders will
continue to have the same liens, encumbrances and security
interests in the cash collateral generated or created post filing,
plus all proceeds, products, accounts, or profits thereof, as
existed prior to the filing date.
A copy of the order is available at https://bit.ly/3alCuLM from
PacerMonitor.com.
About Floor-Tex Commercial Flooring, LLC
Floor-Tex Commercial Flooring, LLC specializes in residential and
commercial flooring contracting. The Debtor sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No.
21-33751) on November 19, 2021. In the petition signed by Chief
Executive Officer Doris Springer, the Debtor disclosed up to $10
million in assets and liabilities.
Judge Eduardo V. Rodriguez oversees the case.
Reese Baker, Esq., at Baker and Associates is the Debtor's
counsel.
FRONT SIGHT MANAGEMENT: $5MM DIP Loan from FS DIP LLC OK'd
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The U.S. Bankruptcy Court for the District of Nevada authorized
Front Sight Management LLC, dba Front Sight Firearms Training
Institute, to use cash collateral on an interim basis in accordance
with the budget and obtain post-petition financing from FS DIP,
LLC.
The Debtor to obtain post-petition financing not to exceed $600,000
on an interim basis. Advance provided for in the Interim Order will
terminate on June 24,2022, absent further Court order.
The rate of interest to be charged on the $600,000 DIP Financing
Advance authorized by the Interim Order shall be 9.5% per annum and
will accrue as payment in kind except the Lender's fees and costs,
which will be paid as set forth in the Loan Documents, or as
otherwise agreed by the parties as set forth in the Loan Documents.
The Debtor does not have sufficient available sources of working
capital and financing to carry on the operation of its business
without the DIP Financing and authorized use of cash collateral. As
a result of the Debtor's financial condition, the use of cash
collateral alone will be insufficient to meet the Debtor's
immediate postpetition liquidity needs.
As adequate protection, the Lender will have a superpriority
administrative expense claim against the Debtor, in an amount not
to exceed the amount of the Advance authorized under the Interim
Order, with priority in payment over any and all administrative
expenses, adequate protection claims, diminution claims and all
other claims against the Debtor.
As security for all DIP Obligations under the Interim Order, the
Lender is granted valid, priming, binding and fully perfected,
security interests in and liens upon all present and after-acquired
property of the Debtor.
The final hearing on the matter is scheduled for June 24 at 9:30
a.m.
A copy of the order is available at https://bit.ly/3x6sQp7 from
PacerMonitor.com.
About Front Sight Management LLC
Front Sight Management LLC specializes in providing courses in gun
training, self-defense martial arts training, and personal safety
-- with firearms or without. Front Sight sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Nev. Case No.
22-11824) on May 24, 2022. In the petition signed by Ignatius
Piazza, manager, the Debtor disclosed up to $50 million in both
assets and liabilities.
Steven T. Gubner, Esq., at BG Law LLP is the Debtor's counsel.
FS DIP, LLC, as DIP agent, is represented by Samuel A. Schwartz,
Esq., and Bryan A. Lindsey, Esq., at Schwartz Law, PLLC.
GAMESTOP CORP: Appoints Nir Patel as Chief Operating Officer
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GameStop Corp. has appointed Nir Patel to the role of chief
operating officer, effective May 31, 2022. Most recently, he was
chief executive officer at Belk, a privately-owned national
retailer with more than 300 stores across 16 states. He previously
held senior roles at Kohl's and Lands' End after beginning his
career at Target and Gap. He has approximately two decades of
experience in operations, merchandising, supply chain, and retail
and store operations.
In connection with his appointment as the Company's chief operating
officer, the Company entered into a letter agreement with Mr. Patel
on May 12, 2022 describing the basic terms of his employment. The
Letter Agreement provides that Mr. Patel's starting annualized base
salary will be $200,000 and that he will also be eligible to earn a
total of $3,400,000 in sign-on bonuses, to be paid in bi-weekly
installments over 24 months, subject to his continuous employment
with the Company through the payment date of the applicable
installment. Mr. Patel is also entitled to reimbursement of
substantiated relocation expenses up to $200,000 in connection with
his relocation to the Dallas/Fort Worth area.
The Letter Agreement also provides that, on the first business day
of the first calendar quarter that commences after the effective
date of his employment, Mr. Patel will be entitled to a grant of a
number of restricted stock units of the Company's Class A common
stock determined by dividing $14,000,000 by the average closing
price of the Common Stock for the 30 trading days immediately
preceding the Grant Date. The Initial Equity Award will vest as
follows: 10% on the first anniversary of the Grant Date, 20% on the
second anniversary of the Grant Date, and 23.333% on each of the
third, fourth, and fifth anniversaries of the Grant Date, subject
in each case to Mr. Patel's continuous service to the Company
through the applicable vesting date. As inducement to accept the
offer of employment and to buyout certain equity entitlements and
other compensation Mr. Patel is forfeiting from his current
employer, Mr. Patel will also be entitled to a grant of a number of
RSUs determined by dividing $21,000,000 by the average closing
pricing of the Common Stock for the 30 trading days immediately
preceding the Grant Date. The Buyout Equity Award will vest
one-third on each of the first, second and third anniversaries of
the Grant Date, subject in each case to Mr. Patel's continuous
service to the Company through the applicable vesting date.
The Letter Agreement also provides that Mr. Patel's employment is
conditioned on his execution of a restrictive covenant agreement
that includes covenants regarding non-competition, non-solicitation
and confidentiality.
Under the Letter Agreement, if Mr. Patel's employment is terminated
by the Company without Cause (as defined in the Letter Agreement),
he will be entitled to receive the following severance benefits:
(i) an amount equal to six months of his base salary, (ii) an
amount equal to six months of COBRA premiums for Mr. Patel and his
eligible dependents, (iii) any sign-on bonus installments which
then remain unpaid and (iv) the vesting of that portion of the
Initial Equity Award and Make-Whole Equity Award, if any, that was
otherwise scheduled to vest in the ordinary course during the six
month period immediately following his termination date. Mr.
Patel's eligibility for these severance benefits is subject to his
execution of a release of claims against the Company and his
compliance with any applicable post-employment covenants.
About GameStop
Grapevine, Texas-based GameStop Corp. is a specialty retailer
offering games and entertainment products through its E-Commerce
properties and thousands of stores.
GameStop reported a net loss of $381.3 million in 2021, a net loss
of $215.3 million in 2020, a net loss of $470.9 million in 2019,
and a net loss of $673 million in 2018. As of Jan. 29, 2022, the
Company had $3.49 billion in total assets, $1.89 billion in total
liabilities, and $1.6 billion in total stockholders' equity.
GARUDA HOTELS: U.S. Trustee Unable to Appoint Committee
-------------------------------------------------------
The U.S. Trustee for Region 2 disclosed in a court filing that no
official committee of unsecured creditors has been appointed in the
Chapter 11 case of Garuda Hotels, Inc.
About Garuda Hotels
Garuda Hotels, Inc. and its affiliate, Welcome Motels II, Inc.,
operate the Country Inn and Suites Hotel and the Econolodge Hotel
in Ithaca, N.Y., respectively. The Debtors also own the real
properties on which the hotels are located.
Garuda Hotels and Welcome Motels sought protection under Chapter 11
of the Bankruptcy Code (Bankr. N.D.N.Y. Case No. 22-30296 and
22-30297) on May 13, 2022. In the petition signed by Jay
Bramhandkar, president, Garuda Hotels disclosed up to $10 million
in both assets and liabilities.
Judge Wendy A. Kinsella oversees the cases.
Erica Aisner, Esq., at Kirby Aisner & Curley LLP, is the Debtors'
counsel.
GARUDA HOTELS: Wins Interim Cash Collateral Access Thru June 28
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of New York
authorized Garuda Hotels, Inc. and Welcome Motels II, Inc. to use
cash collateral on an interim basis in accordance with the budget,
with a 10% variance and provide adequate protection.
Absent further Court order or written consent of RSS Comm 201-LC15
NY GHI LLC, no payments of Cash Collateral will be made to insiders
or affiliates of the Debtors except for salary of $4,000 per month
from each of the Debtors to Jay Bramhandkar, which is included in
the Budget.
The Debtors assert RSS holds a duly perfected senior security
interest in all of their personal property, including the proceeds
thereof, by virtue of a Mortgage Note in the original principal
amount of $7,970,000, secured by, among other things, liens on the
Debtors' real and personal property pursuant to a Loan Agreement,
Mortgage and Assignment of Rents, each dated February 28, 2014 and
UCC-1 Financing Statements filed in connection therewith.
The Court said that, in addition to the existing rights and
interests of RSS and for the purpose of adequately protecting RSS
from diminution in value of the Collateral, RSS is granted
replacement liens in the cash collateral, to the extent the liens
were valid, perfected and enforceable as of the Petition Date and
in the continuing order of priority of the Pre-Petition Liens
without determination herein as to the nature, extent and validity
of said pre-petition liens and claims, and solely to the extent
Collateral Diminution occurs during the Bankruptcy Cases. The
replacement liens are subject to: (i) any United States Trustee
fees incurred by the Debtors pursuant to 28 U.S.C. Section 1930 and
interest thereon pursuant to 31 U.S.C. Section 3717; (ii) the
payment of any claim of any subsequently appointed Chapter 7
Trustee to the extent of $10,000; and (iii) estate causes of action
and the proceeds of any recoveries of estate causes of action under
Chapter 5 of the Bankruptcy Code. No portion of the cash collateral
may be used to challenge, attack or otherwise seek to avoid RSS's
liens under chapter 5 of the Bankruptcy Code or applicable
non-bankruptcy law.
As additional adequate protection, the Debtors will pay to RSS
monthly payments of interest-only, at the contract (non-default)
rate of interest (per diem of $1,056), as set forth in the RSS Loan
Documents.
To the extent the Replacement Liens fail to adequately protected
RSS for the diminution in the cash collateral, RSS reserves all
rights to request allowance of a superpriority administrative
expense claim to the extent provided in 11 U.S.C. section 07(b),
subject only to the Carve-Outs.
The Replacement Liens and security interests granted are
automatically deemed perfected upon entry of the Order without the
necessity of RSS having to take possession, file financing
statements, mortgages or other typical security documents.
The Debtors' authorization to use cash collateral will immediately
terminate without further Order on the earlier of: (a) June 28,
2022, at 5 p.m. EST; (b) the entry of and order granting any party
relief from the automatic stay with respect to any property of the
Debtors in which RSS claims a lien or security interest, whether
pursuant to this Order or otherwise; (c) the entry of an order
dismissing the Bankruptcy Cases or converting the proceedings to
cases under Chapter 7 of the Bankruptcy Code; (d) the entry of an
order confirming a plan or plans of reorganization; or (e) the
entry of an order by which the Order is reversed, revoked, stayed,
rescinded, modified or amended without the consent of RSS thereto.
A further hearing on the matter is scheduled for June 28 at 10
a.m.
A copy of the order is available at https://bit.ly/3NcOlKF from
PacerMonitor.com.
About Garuda Hotels, Inc.
Garuda Hotels, Inc. is the operator of a Country Inn and Suites
Hotel and owns the real property upon which the hotel is located,
110 Danby Road, Ithaca, NY. Welcome is the operator of an
Econolodge Hotel and owns the real property upon which the hotel is
located, 2303 Triphammer Road, Ithaca, NY.
Garuda sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. N.D.N.Y. Case No. 22-30296-5-wak) on May 13, 2022. In
the petition signed by Jay Bramhandkar, president, the Debtor
disclosed up to $10 million in both assets and liabilities.
Judge Wendy A. Kinsella oversees the case.
Erica Aisner, Esq., at Kirby Aisner & Curley LLP is the Debtor's
counsel.
GIRARDI & KEESE: California Supreme Court Disbarred Tom Girardi
---------------------------------------------------------------
Brandon Lowrey of Law360 reports that Thomas V. Girardi, one of the
nation's most revered personal injury lawyers before revelations in
2020 that he stole millions from clients' settlements, was
disbarred Wednesday, June 1, 2022, by the Supreme Court of
California in a largely symbolic ruling.
Girardi had practiced law in California since 1965 and went on to
found the once-bustling plaintiffs firm Girardi Keese in Los
Angeles, where he would win billions of dollars in judgments and
settlements over the course of his career. He rocketed to national
fame as one of the lawyers involved in a groundwater pollution case
that resulted in a $333 million settlement.
About Girardi & Keese
Girardi and Keese or Girardi & Keese was a Los Angeles-based law
firm founded in 1965 by lawyers Thomas Girardi and Robert Keese.
It served clients in California in a variety of legal areas. It
was known for representing plaintiffs against major corporations.
An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No.
20-21022) was filed in December 2020 against GIRARDI KEESE by
alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian,
Erika Saldana, Virginia Antonio, and Kimberly Archie.
The petitioners' attorneys:
Andrew Goodman
Goodman Law Offices, Apc
Tel: 818-802-5044
E-mail: agoodman@andyglaw.com
Elissa D. Miller, a member of the firm SulmeyerKupetz, has been
appointed as Chapter 7 trustee for GIRARDI KEESE. The Chapter 7
trustee can be reached at:
Elissa D. Miller
333 South Grand Ave., Suite 3400
Los Angeles, California 90071-1406
Telephone: (213) 626-2311
Facsimile: (213) 629-4520
E-mail: emiller@sulmeyerlaw.com
An involuntary Chapter 7 petition was also filed against Thomas
Vincent Girardi (Case No. 20-21020) on Dec. 18, 2020. The Chapter 7
trustee can be reached at:
Jason M. Rund
Email: trustee@srlawyers.com
840 Apollo Street, Suite 351
El Segundo, CA 90245
Telephone: (310) 640-1200
GLS AUTO 2022-2: S&P Assigns Prelim BB- (sf) Rating on E Notes
--------------------------------------------------------------
S&P Global Ratings assigned its preliminary ratings to GLS Auto
Receivables Issuer Trust 2022-2's automobile receivables-backed
notes series 2022-2.
The note issuance is an ABS securitization backed by subprime auto
loan receivables.
The preliminary ratings are based on information as of June 2,
2022. Subsequent information may result in the assignment of final
ratings that differ from the preliminary ratings.
The preliminary ratings reflect S&P's view of:
-- The availability of approximately 54.77%, 46.60%, 36.66%,
27.25%, and 22.72% of credit support for the class A, B, C, D, and
E notes, respectively, based on stressed cash flow scenarios
(including excess spread). These credit support levels provide
coverage of approximately 3.25x, 2.75x, 2.15x, 1.55x, and 1.27x our
16.25%-17.25% expected cumulative net loss for the class A, B, C,
D, and E notes, respectively.
-- The expectation that under a moderate ('BBB') stress scenario
(1.60x our expected loss level), all else being equal, S&P's rating
movements are within the limits specified by our credit stability
criteria.
-- The notes' underlying credit enhancement in the form of
subordination, overcollateralization, a reserve account, and excess
spread for the class A, B, C, D, and E notes.
-- The transaction's sequential pay structure, which provides
non-amortizing credit enhancement for the senior classes of notes.
-- S&P's analysis of more than eight years of origination static
pool and securitization performance data on Global Lending Services
LLC's 17 Rule 144A securitizations.
-- The collateral characteristics of the subprime automobile loans
securitized in this transaction, including the representation in
the transaction documents that all contracts in the pool have made
a least one payment.
-- The timely interest and principal payments made to the notes
under S&P's stressed cash flow modeling scenarios, which it
believes are appropriate for the assigned preliminary ratings.
Preliminary Ratings Assigned
GLS Auto Receivables Issuer Trust 2022-2
Class A-1, $76.30 million: A-1+ (sf)
Class A-2, $284.78 million: AAA (sf)
Class B, $88.85 million: AA (sf)
Class C, $87.71 million: A (sf)
Class D, $101.43 million: BBB- (sf)
Class E, $55.29 million: BB- (sf)
GREENE TECHNOLOGIES: Unsecureds Will Get 5% of Claims in 60 Months
------------------------------------------------------------------
Greene Technologies Incorporated filed with the U.S. Bankruptcy
Court for the Northern District of New York a Small Business Plan
of Reorganization dated May 31, 2022.
The Debtor is a corporation with operations located at Grand &
Clinton Streets, Greene, NY 13778. The Debtor is in the business
of manufacturing of fabricated metal products.
As of the Petition Date, the Debtor owed debts classified as
secured debts totaling $1,220,461.31, and unsecured debts totaling
$205,113.05. Debtor's petition listed 7 employees with priority
wage claims totaling $3,450.85, $3,487.43 owed to New York State
for priority unpaid payroll tax, and $60,310.46 priority debt to
the Internal Revenue Service for Withholding and unemployment.
With adjustments taking into account the Proofs of Claim that have
been filed, the secured debts total $1,280,863.03, priority debts
total $86,294.82, and unsecured nonpriority claims total
$225,153.35.
This Plan of Reorganization under Chapter 11 of the Code proposes
to pay creditors of the Debtor from Debtor's cash flow from
operations and future income.
The following lists all classes containing the Debtor's secured
prepetition Claims and their proposed treatment under the Plan:
* Class #1 includes Chenango County Real Property Tax claim
#9, receiving the full value of their claim as secured at 12%
interest paid monthly for 24 months with a balloon payment for the
outstanding balance by the end of the 24th month.
* Class #2 includes Axos Bank's claim #10, receiving partial
payment due to their security only partially covering their claim,
and being paid at 5% interest with monthly payments for 24 months
with a balloon payment for the remaining allowed secured claim by
the end of the 24th month, with any balance being paid as
unsecured.
* Class #3 includes Kevin Rosenkrantz's claim, receiving
partial payment due to their security only partially covering his
claim, and being paid at 5% interest over 120 months, with any
balance being paid as unsecured.
* Class #4 includes Byzfunder, CAN Capital's claim #12,
Cloudfund LLC, and National Funding. These creditors have UCC
filings against personal property for which previous UCC filings
(by Kevin Rosenkrantz) fully encumber the personal property. These
Class #4 creditors' claims will be paid as unsecured.
Class 6 consists of General Unsecured Claims. All Class 6 Claims
shall be paid as wholly unsecured claims. Debtor will pay an amount
equal to approximately five percent (5%) of all allowed Class 6
claims. Payment of Class 6 claims will begin on the first month
after the Effective Date and continue thereafter for sixty (60)
months or until paid 5% of their Claims.
Unsecured creditors, except those with total Plan payouts of $275
or less will receive a pro rata portion of the monthly payment
which will be $567.00. Allowed unsecured claims where Plan payout
of 5% equals $275 or less will be paid in full within 30 days after
the Effective Date. There will be a total payout of approximately
$35,644.00 to unsecured creditors.
Class 7 consists of Carol Rosencrantz as Equity Security Holder of
Debtor. Equity Interest holders shall receive 100% of the
shareholder interests in the reorganized Debtor.
The Plan will be implemented by the Debtor remitting payment to
creditors from the Debtor's cash flow derived from income from the
Debtor's regular business. In addition, by the 24th month following
confirmation of the Plan, the Debtor will sell its real property,
with proceeds to pay the remaining balance of the Property Taxes
and approved secured portion of the mortgage.
A full-text copy of the Plan of Reorganization dated May 31, 2022,
is available at https://bit.ly/3anfZ9o from PacerMonitor.com at no
charge.
Attorney for the Debtor:
Peter A. Orville, Esq.
Orville & McDonald Law, P.C.
30 Riverside Drive
Binghamton, NY 13905
Tel: (607) 770-1007
Email: peteropc@gmail.com
About Greene Technologies Incorporated
Greene Technologies is a metal fabricator and manufacturer based in
Greene, New York. Greene Technologies Incorporated filed a
Chapter 11 bankruptcy petition (Bankr. N.D.N.Y. Case No. 22-60118)
on Feb. 8, 2022.
The petition was signed by Carol M. Rosenkrantz, president. The
Debtor disclosed total assets of $617,665 and total liabilities of
$1,492,823.
Judge Diane Davis oversees the case.
Peter A. Orville, Esq., at Orville & McDonald Law, P.C., serves as
the Debtor's attorney.
GT REAL ESTATE: In Chapter 11 as Panthers Cancel Rock Hill HQ
-------------------------------------------------------------
The Charlotte Observer reports that GT Real Estate Holdings, LLC,
the company billionaire Panthers owner David Tepper established
specifically for the team's Rock Hill headquarters project, has
filed for Chapter 11 bankruptcy in Delaware, the company announced
Wednesday, June 1, 2022, night.
That filing officially ends the Panthers' pursuit of a headquarters
in Rock Hill, S.C., and comes a little more than a month after it
ended its agreement with the City of Rock Hill over the
construction of the nearly 700,000 square-foot facility. The
Panthers, Charlotte FC, and Tepper Sports & Entertainment will be
unaffected by the filing. The company insists those organizations
will operate uninterrupted.
"In recent weeks, GTRE has been confronted with various claims,
some valid and some not, from vendors, contractors and other third
parties, including York County, SC," the company said in a
statement. "GTRE is taking this action to ensure legitimate claims
are processed as fairly and expeditiously as possible under a
court-supervised process, and to achieve the project's orderly and
safe wind-down. GTRE intends to resolve its legitimate
obligations."
The Panthers intended to build a state-of-the-art headquarters on
the 240-acre land in Rock Hill. The project was supposed to be an
economic boost for both the city and South Carolina. It would have
been the largest such facility in the NFL and was intended to be a
sports and entertainment venue for events from soccer games to high
school sports championships and corporate events and concerts.
The Panthers broke ground on the site in 2020.
But in March, the company stopped construction on the property
after a disagreement between the city and GTRE. Tepper Sports said
in a statement at the time that Rock Hill has been "unable to
contribute (to) the agreed upon investment to fund the
construction" of the project.
The city insisted it had.
Regardless, the two sides failed to reach an agreement to continue
construction, and the company terminated the deal.
Tepper, who spoke to the media for the first time in more than a
year in April, declined to speak about the project.
The Charlotte Observer first reported in April that "the Rock Hill
deal is dead."
Though the Panthers will no longer pursue a headquarters in Rock
Hill, they likely will still look elsewhere. Charlotte is an
option, but Tepper could run into issues locally. A city councilman
told the Observer that the city has other priorities.
About GT Real Estate Holdings
GT Real Estate Holdings is a real estate company owned by David
Tepper. It was created to own and develop a mixed-use,
pedestrian-friendly community, sports, and entertainment venue,
that would also include a new headquarters and practice facility
for the Carolina Panthers, a National Football League team,
situated on a 234-acre site located in Rock Hill, South Carolina.
The company suspended further development of the Project in March
2022.
GT Real Estate Holdings sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Del. Case No. 22-10505) on June 2,
2022. In the petition filed by Jonathan Hickman, as chief
restructuring officer, the Debtor reports estimated assets and
liabilities between $100 million and $500 million each.
The Hon. Karen B. Owens is the case judge.
The Debtor tapped White & Case LLP as restructuring counsel; Farnan
LLP, as Delaware counsel; and Alvarez & Marsal as financial
advisor. Kroll Restructuring Administration LLC is the claims
agent.
GT REAL ESTATE: June 9 Deadline Set for Panel Questionnaires
------------------------------------------------------------
The United States Trustee is soliciting members for committee of
unsecured creditors in the bankruptcy case of GT Real Estate
Holdings, LLC.
If a party wishes to be considered for membership on any official
committee that is appointed, it must complete a questionnaire
available at https://bit.ly/3zq7kgy and return by email it to Jane
M. Leamy -- Jane.M.Leamy@usdoj.gov -- at the Office of the United
States Trustee so that it is received no later than 4:00 p.m., on
June 9, 2022.
If the U.S. Trustee receives sufficient creditor interest in the
solicitation, it may schedule a meeting or telephone conference for
the purpose of forming a committee.
About GT Real Estate Holdings
GT Real Estate Holdings, LLC was created to own and develop a
mixed-use, pedestrian-friendly community, sports, and entertainment
venue, that would also include a new headquarters and practice
facility for the Carolina Panthers, a National Football League
team, situated on a 234-acre site located in Rock Hill, South
Carolina. The Debtor suspended further development of the Project
in March 2022.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 22-10505) on June 1, 2022.
Hon. Karen B. Owens oversees the case.
In the petition signed by Jonathan Hickman as chief restructuring
officer, the Debtor disclosed $100 million to $500 million in
estimated assets and $100 million to $500 million in liabilities.
Farnan LLP serves as the Debtor's restructuring counsel. White &
Case LLP is the Debtor's general restructuring counsel. Alvarez &
Marsal acts as the Debtor's financial advisor. Kroll Restructuring
Administration LLC is the Debtor's claims and noticing agent and
administrative advisor.
HELLO LIVING: Amends Mezz Lender Secured Claim Pay Details
----------------------------------------------------------
Hello Living Developer Nostrand, LLC, submitted a Third Amended
Disclosure Statement describing Chapter 11 Plan dated May 31,
2022.
The Debtor owns 100% of the shares of stock of Hello Nostrand LLC.
Hello Nostrand owns and operates valuable real property located at
1580 Nostrand Avenue, Brooklyn, New York (the "Real Property").
The Debtor has made adjustments of approximately $3,000,000 in
improvements on the building rendered after the appraisal and an
additional adjustment based on the Lease entered into between Hello
Nostrand and its main Lessee providing for income of $3,200,000 per
annum. While it may be argued that the amount should not change the
appraised value, it can be equally argued that the increase in
expected income should increase the value of the Real Property.
Against these assets there exists secured and unsecured liabilities
of Hello Nostrand as follows: either $58,000,000 or $66,000,000
based upon statements made as of May 20, 2022 by Nostrand Senior
Lender in various pleading to this Court, and Nostrand Senior
Lender and Nostrand Mezz Lender alleges that in addition to these
amounts there exists a security interest in favor of Nostrand Mezz
Lender in the stock assets of the Debtor-holding company in the
approximate amount of $4,550,000.
Class 1 consists of the Allowed Secured Claims of Nostrand Mezz
Lender holding a claim alleged to be in the amount of approximately
$3,000,000 in unpaid principal which is alleged to be $4,500,000
presently which claim includes prepayment fees, forbearance fees,
exit fees, servicing fees and any other charged by this creditor.
Class 1 Creditor shall receive payment of 100% of its Allowed Claim
within 90 days after the Confirmation Date. The funds shall be
provided by Nostrand Debtor Investor who shall receive a 40%
investment interest in the Project on account of its investment.
The Debtor intends to seek a determination that the amount of
Nostrand Mezz Lender claim should be adjusted to accrue interest at
the interest rate of the then applicable non-default contract rate
of interest or 12% per annum for the period of March 2021 until
December 21, 2021 the date of the filing of the Chapter 11 case and
the rate thereafter to be determined by this Court.
Class 2 consists of any allowed unsecured claims in the approximate
amount of $1,625,000. Such claims shall be paid, pro rata, in full
plus interest at 4.5% interest from the confirmation date from the
funds received in connection with the project but not from Lease
Income as long as the claims of Nostrand Mezz Lender and Nostrand
Senior Lender have not been satisfied. This Class is impaired.
Class 3 consists of holders of the equity interest of the Debtor.
The equity holders shall be paid their investments in the Project.
Equity holders shall not be paid until Nostrand Mezz Lender and
Nostrand Senior Lender have been paid in full.
The Plan will provide for the payment of the Allowed secured claim
of Nostrand Mezz Lender, in full, within 90 days after the
confirmation date. Nostrand Debtor Investor shall provide the
payment. Nostrand Debtor Investor shall receive a 40% interest in
the equity of the project based on its investment and shall be paid
from that interest.
Subsidiary, Hello Nostrand, the Landlord of the Lease, agreed to
make monthly payments provided for under this Plan as evidenced by
its consent to the Plan and is bound to make such payments and is
not simply a discretionary item for Hello Nostrand to agree to pay
pursuant to the provisions of the Lease. This Lease is valid and
effective and is between a substantial entity, as Tenant, and Hello
Nostrand, as Landlord. The Master Tenant has confirmed that it
opended up an Escrow Amount in the amount of $600,000 for tenant
improvements.
A full-text copy of the Third Amended Disclosure Statement dated
May 31, 2022, is available at https://bit.ly/3xeOYxJ from
PacerMonitor.com at no charge.
Attorney for the Debtor:
Leo Fox, Esq.
630 Third Avenue – 18th Floor
New York, New York 10017
Telephone: (212) 867-9595
Facsimile: (212) 949-1857
E-mail: leo@leofoxlaw.com
About Hello Living Developer Nostrand
Hello Living Developer Nostrand, LLC, is a single asset real estate
debtor (as defined in 11 U.S.C. Section 101(51B)).
Hello Living filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No. 21-22696) on
Dec. 21, 2021, disclosing $50 million to $100 million in both
assets and liabilities. Eli Karp, manager, signed the
petition.
Judge Sean H. Lane oversees the case.
The Debtor tapped Leo Fox, Esq., a practicing attorney in New York,
to handle its bankruptcy case. Victor A. Worms, Esq., is tapped as
an associate attorney.
HERTZ GLOBAL: Judge Balks at Wider Probe of Customer Arrests
------------------------------------------------------------
Jeff Montgomery of Law360 reports that a Delaware bankruptcy judge
acknowledged Thursday, June 2, 2022, that "systemic" problems could
justify a finding that wrongly arrested Hertz auto rental customers
were entitled to actual notice of the company's bankruptcy, but the
judge balked at immediately approving expanded discovery by victim
attorneys.
Judge Mary F. Walrath told attorneys for both sides during a
half-day hearing that current proposals for probing the issue by
attorneys for false police report claimants are too broad and
potentially prejudicial to the reorganized company's estate.
About Hertz Global Holdings
Hertz Corp. and its subsidiaries -- http://www.hertz.com/--
operate a worldwide vehicle rental business under the Hertz,
Dollar, and Thrifty brands, with car rental locations in North
America, Europe, Latin America, Africa, Asia, Australia, the
Caribbean, the Middle East, and New Zealand. The Company also
operates a vehicle leasing and fleet management solutions
business.
On May 22, 2020, The Hertz Corporation and certain of its U.S. and
Canadian subsidiaries and affiliates filed voluntary petitions for
reorganization under Chapter 11 in the U.S. Bankruptcy Court
(Bankr. D. Del. Case No. 20-11218).
The Hon. Mary F. Walrath is the presiding judge.
White & Case LLP is serving as legal advisor, Moelis & Co. is
serving as investment banker, and FTI Consulting is serving as
financial advisor. Richards, Layton & Finger, P.A., is the local
counsel.
Prime Clerk LLC is the claims agent, maintaining the page
https://restructuring.primeclerk.com/hertz
HOME PRODUCTS: Case Summary & 30 Largest Unsecured Creditors
------------------------------------------------------------
Two affiliates that concurrently filed voluntary petitions for
relief under Chapter 11 of the Bankruptcy Code:
Debtor Case No.
------ --------
Home Products International, Inc. 22-06276
4501 W. 47th St.
Chicago, IL 60632
Home Products International - North America, Inc. 22-06283
4501 W. 47th Street
Chicago, IL 60632
Business Description: The Debtors are in the business of plastics
product manufacturing.
Chapter 11 Petition Date: June 2, 2022
Court: United States Bankruptcy Court
Northern District of Illinois
Judge: Hon. Janet S. Baer
Debtors' Counsel: Edward J. Green, Esq.
FOLEY & LARDNER LLP
321 North Clark Street
Suite 3000
Chicago, IL 60654
Tel: 312-832-4500
Fax: 312-832-4700
Email: egreen@foley.com
Home Products International's
Estimated Assets: $0 to $50,000
Home Products International's
Estimated Liabilities: $10 million to $50 million
Home Products International - North's
Estimated Assets: $10 million to $50 million
Home Products International - North's
Estimated Liabilities: $50 million to $100 million
The petitions were signed by James Auker as chief financial
officer.
Full-text copies of the petitions are available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/BV2CIMY/Home_Products_International_Inc__ilnbke-22-06276__0001.0.pdf?mcid=tGE4TAMA
https://www.pacermonitor.com/view/M6FO3TQ/Home_Products_International_-__ilnbke-22-06283__0001.0.pdf?mcid=tGE4TAMA
Consolidated List of Debtors' 30 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Braskem America, Inc. Trade Debt $2,993,500
1735 Market St FL 28
Philadelphia, PA 19103-7534
Contact: Clarissa Graziani
Tel: 267-908-0061
Email: clarissa.graziani@braskem.com
2. Material Difference Trade Debt $2,862,492
Technologies
1501 Sarasota Center Blvd
Sarasota, FL 34240
Contact: Scott Williford
Tel: 214-914-1922
Email: scottw@materialdifference
technologies.com
3. Pinnacle Polymers Trade Debt $1,870,905
One Pinnacle Avenue
Garyville, LA 70051
Contact: Ray Buckwalter
Tel: 908-635-4177
Email: ray.buckwalter@pinnaclepolymers.com
4. Blue Fin Steel Trade Debt $1,523,418
372 Bay Street
Suite 406
Toronto, ON M5H 2W9 Canada
Contact: Melina Garate
Tel: 416-640-0548 X1004
Email: melina@bluefinsteel.com
5. Jade Metals Corp. Trade Debt $633,088
9 Gladiola Court
Toronto, ON M3H 5X5
Canada
Contact: Stephen Margles
Tel: 416-569-3539
Email: stephen@jademetals.com
6. Chicago Mold Engineering Trade Debt $505,180
615 Stetson Ave
St. Charles, IL 60174
Contact: Jeff Oswald
Tel: 630-816-8365
Email: joswald@chicagomold.com
7. Riverview Steel Co., Ltd. Trade Debt $504,755
8165 Anchor Drive
Windsor, ON N8N 5B7
Canada
Contact: Michael Meloche
Tel: 519-979-8255 X247
Email: mmeloche@riverviewsteel.com
8. Kloeckner Metals US Trade Debt $490,165
Midwest Inc.
Receivables Corporation
75 Remittance Drive, Suite 6402
Chicago, IL 60675
Contact: Robert Schieman
Tel: 317-460-0961
Email: rob.schieman@kloeckner.com
9. Associated Steel Trading LLC Trade Debt $348,048
12187 E. Cortez Drive
Scottsdale, AZ 85259
Contact: Ian Epstein
Tel: 480-577-4904
Email: ijepstein@associatedsteeltrading.com
10. American Eagle Packaging Corp. Trade Debt $341,747
1645 Todd Farm Drive
Elgin, IL 60123
Contact: Tom O'Malley
Tel: 224-856-4817
Email: tomalley@aepkg.com
11. Dynegy Energy Services Trade Debt $295,613
27679 Network Place
Chicago, IL 60673
Contact: Customer Service
Tel: 833-241-4591
Email: descutcare@vistracorp.com
12. Westrock CP, LLC Trade Debt $289,454
3101 State Street
Columbus, IN 47201
Contact: Cheryl Cook
Tel: 770-326-8493
Email: cheryl.cook@westrock.com
13. Cooltex (ANHUI) Trade Debt $282,154
Manufacturing
No. 8 Jingyi Road
Toncheng, Anging, Anhui
231400
China
Contact: Randy Ren
Tel: +86-5566567678
Email: randy.ren@163.com
14. Blue Ridge Industries, Inc. Trade Debt $263,370
266 Arbor CT
Winchester, VA 22602
Contact: Natalie Miller
Tel: 540-662-3900 X232
Email: nmiller@blueridgeind.com
15. Green Bay Packaging Trade Debt $249,793
3601 N. Runge Avenue
Franklin Park, IL 60131
Contact: Joel Barta
Tel: 920-433-5116
Email: jbarta@gbp.com
16. RSM US LLP Trade Debt $220,455
5155 Paysphere Circle
Chicago, IL 60674
Contact: Bob Seifert
Tel: 847-413-6458
Email: bob.seifert@rsmus.com
17. CH Robinson/ABH Division - OCE Trade Debt $220,028
14701 Charlson Road
Eden Prarie, MN 55347-5076
Contact: Elizabeth Watson
Tel: 1-855-229-6128
Email: elizabeth.watson@chrobinson.com
18. Scott Steel LLC Trade Debt $212,875
Attn: John Scott
125 Clark St
Piqua, OH 45356
Contact: John Scott
Tel: 937-552-9670
Email: john.scott@scottsteelllc.com
19. Mill Steel Company Trade Debt $201,418
2905 Lucerne Dr SE
Grand Rapids, MI 49546
Contact: Tim Vanwingerden
Tel: 616-977-9056
Email: tim.vanwingerden@millsteel.com
20. Harvey Pallets Inc. Trade Debt $182,623
2200 138th St
Blue Island, IL 60406-3209
Contact: Manuel Tavarez
Tel: 708-293-1831
Email: manuel@harveypallets.com
21. Ube Machinery Inc. Trade Debt $181,727
5700 South State Street
Ann Arbor, MI 48108
Contact: Devin Hake
Tel: 734-741-7818
Email: dhake@ubemachinery.com
22. Pro-Met Steel, Inc. Trade Debt $172,321
20550 S. Lagrance Rd
Suite 300
Frankfort, IL 60423
Contact: Justin Egle
Tel: 773-995-0317
Email: prometjustin@att.net
23. Global Felt Technologies Trade Debt $156,754
541 Buffalo West Springs Hwy
Union, SC 29379-9603
Contact: Joey Duncan
Tel: 864-426-2047
Email: jduncan@dalcononwovens.com
24. TMS Sales & Marketing, Inc. Trade Debt $126,655
9950 West Lawrence Avenue,
Suite 400
Schiller Park, IL 60176
Contact: Curtis Matheney
Tel: 847-489-5318
Email: webinquiry@tmssalesinc.com
25. Talco Plastics, Inc. Trade Debt $114,282
1000 W. Rincon St.
Corona, CA 92878
Contact: Jack Shedd
Tel: 951-531-2001
Email: jack@talcoplastics.com
26. TNT Plastics Molding Trade Debt $110,127
725 East Harrison Street
Corona, CA 92879
Contact: Dennis Chadwick
Tel: 951-808-9700 X302
Email: dennis@tntplasticmolding.com
27. Forever Holdings Ltd. Trade Debt $109,816
Unit 507
5th Floor, Kowloon Plaza
Hong Kong 528322
Hong Kong
Contact: Vera Chan
Tel: +852-27825663
Email: verachan@forever-china.com
28. Metals USA Trade Debt $101,484
5750 Lower Valley Pike
Pittsburgh, PA 45502
Contact: Brian Schmidt
Tel: 330-264-8416 X203
Email: bscmidt@metlasusa.com
29. PAMCO Trade Debt $86,666
147 Seaboard LN
Franklin, TN 37067-8217
Contact: Scott Gallinger
Tel: 919-518-6288
Email: scott.gallinger@resourcelabel.com
30. Colors For Plastics Inc. Trade Debt $70,673
2245 Pratt Blvd.
Elk Grove Village, IL 60007
Contact: Robert Dalleska
Tel: 847-462-6071
Email: rdalleska@colorsforplastics.com
INFOW LLC: Reaches Deal With U.S. Trustee to Dismiss Bankruptcy
---------------------------------------------------------------
Daniel Gill of Bloomberg Law reports that InfoWars and two
affiliates tied to right-wing radio host Alex Jones struck a deal
with the Justice Department to dismiss their bankruptcy cases
pending in Texas.
Mr. Jones was criticized for abusing the bankruptcy system by
having his companies file for bankruptcy in April 2022 to limit
their liability after a defamation judgment against him and
InfoWars for making false statements about the Sandy Hook
Elementary School shooting. Mr. Jones and his main company with
assets, Free Speech Systems LLC, didn't file for bankruptcy.
The bankrupt companies' chief restructuring officer "determined
that it is in the best interest of the debtors' estates and their
creditors not to continue the Chapter 11 cases in light of the
dismissal with prejudice of the Debtors from the lawsuits against
them by the Texas and Connecticut plaintiffs," according to the
stipulation filed Wednesday in the U.S. Bankruptcy Court for the
Southern District of Texas.
The stipulation was signed by the debtors, a trustee overseeing the
case, and the U.S. Trustee, which is the Justice Department's
bankruptcy watchdog.
After Jones sought bankruptcy for his companies, the Sandy Hook
victim families who sued him in Connecticut and Texas for
defamation responded by dismissing his three bankrupt companies
from their lawsuits.
The families' move eliminated the automatic bankruptcy stay—which
had put the defamation damages litigation on pause—against Jones
and Free Speech Systems.
The companies' bankruptcy filings came shortly before the start of
trials to determine how much they would have to pay in damages.
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.
InfoW and affiliates, IWHealth, LLC and Prison Planet TV, LLC,
filed petitions under Chapter 11, Subchapter V of the Bankruptcy
Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April 18, 2022.
Melissa A. Haselden serves as Subchapter V trustee.
In the petition filed by W. Marc Scwartz, chief restructuring
officer, InfoW listed up to $50,000 in assets and up to $10 million
in liabilities.
Judge Christopher M. Lopez oversees the cases.
Kyung S. Lee, Esq., is the Debtor's legal counsel.
IRIS HOLDING: S&P Assigns Preliminary 'B' ICR, Outlook Negative
---------------------------------------------------------------
S&P Global Ratings assigned its 'B' preliminary issuer credit
rating to Iris Holding Inc., which reflects its pro forma view of
Intertape's high leverage and financial sponsor ownership on
completion of the acquisition.
S&P said, "We also assigned a 'B' preliminary issue-level rating
and '3' recovery rating (no notching) to Iris' proposed US$1.5
billion secured term loan; and 'CCC+' preliminary issue-level
rating and '6' recovery rating (two notches below Iris' ICR), to
the proposed US$400 million unsecured notes.
"The negative outlook reflects Iris' high estimated adjusted debt
to EBITDA this year, and the possibility that the company will not
generate sufficient earnings growth that we assume is required to
reduce leverage below 7x in 2023 due to increasing macro-economic
risks."
Clearlake Capital Group L.P. is expected to complete its proposed
acquisition of Intertape Polymer Group Inc. (Intertape; BB-/Watch
Neg/--) this year and recapitalize the company.
Clearlake plans to fund the acquisition primarily with debt, issued
by Iris Holding Inc., the ultimate borrower and holding company
that will indirectly own Intertape.
Debt leverage at Iris (Intertape) is expected to remain high in the
next few years; S&P assumes its financial sponsor ownership will
not pursue material debt reduction.
S&P said, "Our rating on Iris reflects our view of Intertape and
its pro forma capital structure following its expected acquisition
by Clearlake this year. We estimate Iris' adjusted debt to EBITDA
at over 7x at the end of fiscal years 2022 and 2023, which is well
above our previous estimates for Intertape (in the mid-2x area)
before the acquisition announcement. The increase reflects
incremental debt to be raised by Clearlake through its Iris
subsidiary to fund the acquisition, and results in our highly
leveraged financial risk assessment. The proposed debt includes a
US$1.5 billion secured term loan and US$400 million unsecured
notes, as well as a new US$250 million asset-based loan (ABL)
facility (undrawn at close). Clearlake will also add US$809 million
in new equity and US$100 million subordinated payment-in-kind (PIK)
note, which, together with new debt proceeds, will fund the
acquisition and repay all Intertape debt outstanding. On completion
of the takeover, we expect to withdraw our ratings on Intertape.
"Our 'B' preliminary ICR on Iris also incorporates its 100%
ownership by Clearlake, which we consider a financial sponsor.
Financial sponsors typically take ownership of companies by using a
high proportion of debt that focuses on maximizing equity returns
for the sponsor for a relatively short time (often about five
years). In our view, this is evident in Iris' high pro forma
leverage, which we assume will remain well above 5x. We believe
future acquisitions and/or shareholder returns are more likely uses
of Iris' future excess cash generation than debt repayment."
Leverage will likely remain high and limit financial flexibility.
S&P said, "We estimate Iris' leverage in the high-7x area at
end-2022 and about 7x in 2023, which we view as aggressive for the
rating. We assume EBITDA growth next year will lead to modest
deleveraging, and the company will generate positive free cash
flow. Our free cash flow estimates continue to incorporate
growth-related expenditures that should benefit future productivity
and help at least preserve margins. However, deleveraging over the
next few years is expected to be modest and dependent on continued
earnings improvement.
"Iris' prospective leverage is highly sensitive to relatively
modest changes in EBITDA and profitability, mostly on the downside.
For example, we estimate that, all else being equal, a
100-basis-point drop in our EBITDA margin assumption in 2023 would
lead to an increase in leverage of about 0.5x. Alternatively,
leverage remains above 5x in a scenario whereby Iris' EBITDA
margins are 200 basis points higher in tandem with a materially
higher rate of revenue growth relative to our estimates.
"We also believe Iris will be acquisitive and this could lead to an
increase in its prospective debt levels. Intertape had a long track
of acquisitions that contributed to its stronger earnings profile,
although most were modest in scale. The company participates in
certain highly fragmented markets that we assume could present
several potential targets. Under Clearlake's ownership, we believe
there will be a continuing focus on growth (or shareholder returns
in the absence of acquisitions) with greater tolerance for
continuing high leverage."
Positive industry demand and Iris' strong market position should
facilitate steady earnings growth, but risks are increasing.
S&P said, "We expect Iris will generate growth in earnings and cash
flow over the next few years, with higher volumes and prices that
mitigate near-term cost inflation. Revenues for water-activated
tape, protective packaging, and films rose sharply following the
onset of the COVID-19 pandemic, amid a surge in online purchasing.
We believe demand trends for the company's products will remain
positive, led by the core water-activated tape business where it
holds a leading market share by a large margin. The company
strengthened its backlog at end-2021, and we believe this should
underpin near-term growth in volumes. E-commerce should remain a
long-term growth driver for packaging customers, as consumers
continue to shift their purchases online. Moreover, continuing
market emphasis on sustainability and the reduction of packaging
waste should benefit Iris. We believe high levels of corrugated box
recycling (more than 90% in the U.S.) will continue, and the
company's water-activated tape is recyclable with each box. We
estimate Iris' EBITDA in the high-US$200 million area in 2022 and
expect further growth in 2023. We expect price increases that were
announced in late 2021 and effective this year will mitigate the
impact of inflationary and supply-chain pressures. In addition, the
company has a good track record of managing its exposure to higher
raw material costs through pass-throughs, and this should
continue.
"However, our estimates for 2023 have become increasingly sensitive
to weaker-than-expected economic growth. S&P Global Economics
recognizes that recession risks have increased as uncertainty about
the U.S. economic outlook has worsened, particularly next year due
to the lag in the impact of monetary policy. Although we still
expect demand growth (and the company likely has options to
mitigate the near-term impact of lower-than-expected volumes on
earnings and cash flow), modest underperformance in Iris' operating
results could keep leverage above 7x--above our threshold for the
rating.
"Our rating also incorporates Intertape's established position in
the tape market segment."
The company is the second-largest tape producer in North America,
albeit at a distant position behind 3M Co. Intertape holds strong
market shares in its core product end markets, primarily
e-commerce, manufacturing, and food packaging, among others. The
company's dominant share of the niche water-activated tape market
positions it to benefit from continued growth in e-commerce. S&P
said, "In addition, we believe Intertape's comprehensive product
offering provides a competitive advantage relative to that of
smaller industry participants as well as leading players in the
packaging industry such as 3M, which does not produce films or have
a major presence in water-activated tapes. In addition, we now view
the company's profitability as less volatile than we previously
envisioned; Intertape generated relatively stable margins and
return on capital last year despite sharply higher resin prices
(mainly polyethylene) and this is a key driver of our fair business
risk assessment. These positive factors are partially offset by
Intertape's modest scale (adjusted EBITDA of about US$240 million
in 2021) and limited geographic diversification (large majority of
revenue generated in the U.S.) relative to those of global rated
peers. In our view, this contributes to heightened sensitivity to
competitive pressures."
The negative outlook reflects Iris' high estimated adjusted debt to
EBITDA this year following Clearlake's acquisition of Intertape,
and the potential that leverage will stay above 7.0x in 2023. In
our view, increasing risks to the U.S. economy, inflationary
headwinds, and potential acquisitions are key risks that could
temper growth in the company's earnings and the pace of its
deleveraging.
S&P said, "We could consider a downgrade if, over the next 12
months, we expect the company's leverage to remain above 7.0x in
2023. We believe this could occur if EBITDA and cash flow
generation fall short of our estimates due to slower-than-expected
economic growth in the U.S. that constrains demand, and/or
increased input costs and heightened market competition that
pressure margins. Debt-financed acquisitions with poor prospects
for deleveraging, or weaker liquidity could also lead to a
downgrade.
"We could revise the outlook to stable if, over the next 12 months,
we believe Iris will generate leverage below 7.0x in 2023. In our
view, steady earnings growth and cash flow slightly ahead of our
estimates will likely facilitate sufficient improvement in
leverage, as we do not anticipate material debt reduction. We
believe this would require continuing favorable packaging demand
fundamentals and the company's ability to effectively manage
volatile raw material costs."
ESG credit indicators: E-2, S-2, G-3
S&P said, "Governance is a moderately negative consideration in our
credit rating analysis of Iris. Our assessment of the company's
financial risk profile as highly leveraged reflects corporate
decision-making that prioritizes the interests of the controlling
owners, in line with our view of the majority of rated entities
owned by private-equity sponsors. Our assessment also reflects
their generally finite holding periods and a focus on maximizing
shareholder returns."
J & J CONSULTING: U.S. Trustee Appoints Creditors' Committee
------------------------------------------------------------
The U.S. Trustee for Region 17 appointed an official committee to
represent unsecured creditors in the Chapter 11 cases of J & J
Consulting Services, Inc. and J and J Purchasing, LLC.
The committee members are:
1. James Bret Armatas
2976 The Peaks Lane
Las Vegas, NV 89138
Phone: (909) 489-8794
Email: barmatas@aol.com
2. Colony Lake, LLC
Attention: Brett Primack
33 Emerald Dunes Cir.
Henderson, NV 89052
Phone: (702) 858-4051
Email: brett@lvremodel.com
Counsel: Matthew Dushoff
Saltzman Mugan Dushoff
1835 Village Center Cir.
Las Vegas, NV 89134
Phone: (702) 405-8500
Email: mdushoff@nvbusinesslaw.com
3. Invest Edge, LLC
Attention: Dan Edgington
10813 Oak Shadow
Las Vegas, NV 89144
Phone: (702) 491-9562
Email: dan@edwatercustompods.com
Counsel: James Beckstrom
400 S. 4th St., #650
Las Vegas, NV 89101
Phone: (702) 300-0599
Email: jb@beckstromlaw.com
4. Muehle Capital, LLC
Attention: Eric Muehle
57 Isleworth Drive
Henderson, NV 89052
Phone: (702) 757-7481
Email: emuehle@comcast.net
Counsel: Samuel Schwartz
Schwartz Law PLLC
601 E. Bridger Avenue
Las Vegas, NV 89101
Phone: (702) 802-2207
Email: saschwartz@nvfirm.com
5. Bryce Mahonri Moriancumer Bussey
1277 S. 1050 W.
Payson, UT 84651
Phone: (909) 583-3774
Email: mahonri.bussey@gmail.com
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About J & J
A group of creditors, including Keith Ozawa, Anthony Bonifazio,
Brian Schumann, Darius Rafie and Martin Keevin Cordova, filed
involuntary petitions under Chapter 11 of the Bankruptcy Code
against J & J Consulting Services, Inc. and J and J Purchasing, LLC
(Bankr. D. Nev. Lead 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 cases.
The Debtors tapped Garman Turner Gordon, LLP as legal counsel and
Province, LLC as financial advisor. Peter Kravitz of Province
Partners, LLC is the Debtor's chief restructuring officer.
JANE STREET: Fitch Assigns 'BB+' LongTerm Issuer Default Rating
---------------------------------------------------------------
Fitch Ratings has assigned Jane Street Group, LLC a Long-Term
Issuer Default Rating (IDR) and senior secured debt rating of
'BB+'. The Rating Outlook is Stable. Fitch has also assigned a
senior secured debt rating of 'BB+' to JSG Finance, Inc. as
co-issuer of the group's $600 million senior secured notes.
KEY RATING DRIVERS
The ratings reflect Jane Street's strong, established market
position as a technology-driven market maker in the exchange traded
fund (ETF) market across various venues, its scale versus rated
peers, and its strong operating performance, appropriate leverage
and good track record of managing market and operational risks
since its inception in 2000.
Primary rating constraints include elevated operational risks
inherent in technology-driven trading, although Fitch believes the
firm has a robust risk control framework. Other constraints include
elevated market risk due to Jane Street's willingness to hold
positions longer than peer market makers, limited business
diversification outside of the liquidity provision space, reliance
on volatile transactional revenue streams and a fully secured
funding profile.
Fitch views Jane Street's focus on organic growth into adjacent
strategies and products favorably relative to peers engaged in
debt-financed acquisitions. However, the firm's expansion into new
geographies and/or asset classes, such as cryptocurrencies, could
result in higher market, balance sheet and funding risks over time.
The ratings also reflect Fitch's expectation that Jane Street will
maintain a prudent deployment process for its various new trading
strategies. Fitch believes Jane Street's heavy insider ownership
and compensation structures represent strong alignment and help to
mitigate the risks associated with expanding into new strategies
over the long term.
Jane Street's balance sheet exposures have grown materially over
the last 24 to 36 months, driven by strong market dynamics,
including continued fund flows into ETFs, where the firm is a
market leader. This, along with Jane Street's growth strategy in
other products and strategies, has supported meaningful revenue
growth and strong profitability.
Fitch expects Jane Street's profitability to remain elevated
relative to its historical average over the medium term. This is
due to its scalable business model and the build out of new
strategies over time, which should be supportive of more stable
revenue generation in a more subdued trading environment.
Jane Street's balance sheet leverage is relatively low, at 6.9x at
March 31, 2022, compared to Fitch's 'bb' category capitalization
and leverage benchmark range of 15x-20x for securities firms with
high balance sheet usage. Fitch expects member withdrawals to be
nominal in the context of earnings going forward, and expects
leverage will remain conservatively managed. While not expected,
Fitch would view a material increase in balance sheet leverage
at-or above 10x negatively, particularly if associated with more
substantial market risks and use of confidence-sensitive secured
borrowings.
Similar to peers, Jane Street's funding profile is viewed as
limited, given its fully-secured corporate debt profile and
reliance on confidence-sensitive secured broker-dealer facilities.
Corporate debt includes a $2.45 billion senior secured term loan
due in January 2028, and a $600 million senior secured note due in
November 2029.
Fitch views Jane Street's liquidity as generally adequate, as the
risks of its confidence-sensitive and predominantly secured funding
profile are partially offset by the largely liquid securities
inventory, which primarily consists of Level 1 financial
instruments. However, given its business model and strategy, Fitch
notes that Jane Street tends to hold relatively more Level 2 assets
as a percentage of total securities owned compared to peers, which
are not as liquid and could be subject to more material valuation
marks during a market dislocation. Jane Street has a $250 million
committed revolving line of credit with nothing currently drawn.
The Stable Rating Outlook reflects Fitch's expectations that Jane
Street will maintain strong operating performance, low balance
sheet leverage and sufficient liquidity in a less favorable market
environment. The Outlook also incorporates the expectation that
Jane Street's strong risk management and controls' framework will
remain effective and scalable in accordance with its overall growth
and broadening of operations.
The secured term loan rating is equalized with the IDR and reflects
the fully secured funding profile and average recovery prospects in
a stressed scenario.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Material operational or risk management failures that lead to
an outsized earnings loss;
-- An inability to maintain balance sheet leverage below 10.0x on
a net adjusted leverage basis;
-- Adverse legal or regulatory actions against Jane Street, which
results in a material fine, reputational damage, or alteration
in the business profile;
-- An inability to maintain its strong market position in the
face of evolving market structures and technologies; and/or
-- An idiosyncratic liquidity event.
Positive rating action is likely limited given the significant
operational risk inherent in technology-driven trading. However,
factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Consistent operating performance and minimal operational
losses over a longer time period;
-- Maintaining balance sheet leverage consistently at-or-below 5x
on a net adjusted leverage basis;
-- Increased funding flexibility, including demonstrated access
to third party funding through market cycles and the
introduction of an unsecured funding component.
The secured term loan rating is primarily sensitive to changes in
Jane Street's IDR, and secondarily, to material changes in its
capital structure and/or changes in Fitch's assessment of the
recovery prospects for the debt instrument.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Financial Institutions and
Covered Bond 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.
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
---- ------
Jane Street Group, LLC LT IDR BB+ New Rating
senior secured LT BB+ New Rating
JSG Finance, Inc.
senior secured LT BB+ New Rating
JGR GROUP: Voluntary Chapter 11 Case Summary
--------------------------------------------
Debtor: JGR Group, Inc.
9-19 38 Avenue
Long Island City, NY 11101
Business Description: JGR Group, Inc. is a privately held company
in the residential bilding construction
industry.
Chapter 11 Petition Date: June 3, 2022
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 22-10710
Debtor's Counsel: Leo Jacobs, Esq.
JACOBS PC
450 Lexington Avenue, 4th Floor
New York, NY 10017
Tel: (718) 772-8704
E-mail: leo@jacobspc.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Gennadiy Sadykov as president.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/RE7SUMQ/JGR_Group_Inc__nysbke-22-10710__0001.0.pdf?mcid=tGE4TAMA
KINETIK HOLDINGS: Fitch Assigns BB+ LongTerm Issuer Default Rating
------------------------------------------------------------------
Fitch Ratings has assigned a Long-Term Issuer Default Rating (IDR)
of 'BB+' to Kinetik Holdings LP (Kinetik LP) and a 'BB+'/'RR4'
rating to the partnership's proposed offering of senior unsecured
notes and senior unsecured credit facility. Kinetik LP is a
subsidiary of Kinetik Holdings Inc. (Kinetik).
Kinetik will use the proceeds from the notes offering primarily to
repay debt of subsidiaries of Kinetik LP, including but not limited
to term loans at BCP Raptor LLC (B/Stable) and BCP Raptor II, LLC
(B/Stable). At the closing of the notes' transaction and the
repayment of these rated term loans, Fitch expects to withdraw the
ratings of these two borrowers. The Rating Outlook for Kinetik LP
is Positive.
Kinetik's ratings are based on the company's large annual EBITDA,
segment diversity, customer diversity, a largely fee-based revenue
stream, and a measure of revenue-assurance features in contracts
that provide cash flow. The Permian basin location is a moderate
positive since similarly sized comparable companies also enjoy
basin diversity.
The legacy Raptor companies have posted reliable and steady volume
growth for the last 18 months and have benefited from contract
"wins", which demonstrated solid commercial acumen. However,
volumetric uncertainty is a key risk reflected in the ratings.
The Positive Outlook is based on steady volume growth that Fitch
expects to continue for the legacy Raptors and on customer drilling
and completion activity located in advantageous positions given the
Raptor's solidly built-out network. Kinetik as a whole will benefit
for the next large increment of volume growth from a high degree of
operating leverage. Fitch forecasts in 2023 leverage
(Fitch-defined) in the 3.7x-3.9x area, which positions the company
strongly in its rating category.
KEY RATING DRIVERS
Solid Gathering Territory with Connections to Demand Centers: An
approximately $800 million p.a. EBITDA company, Kinetik's scale is
strong for the rating category. Kinetik has a balanced profile
given its pairing of supply and demand territories. Approximately
two-thirds of EBITDA will come from Gathering and Processing (G&P)
operations in the Delaware basin. The Delaware basin has been the
faster-growing (percentage basis) of the Permian basin's two
sub-basins in recent years.
The Permian overall is the leading U.S. oil basin. Over half of all
oil-directed rigs working in the U.S. are located in the Permian
basin. Kinetik supplements its G&P business with a long-haul
pipeline business (via joint ventures). Its three biggest joint
venture pipelines each terminate in robust demand centers at
different points along the Texas coast. Fitch expects both segments
of Kinetik will continue to develop operations by capitalizing on
their geography and Kinetik's size.
Volumetric Risk: The largest segment by EBITDA at Kinetik is
Midstream Logistics (sometimes called gathering and processing).
Kinetik has very few minimum volume commitments in this segment.
The segment depends on customers with dedicated acreage to Kinetik
to drill and complete wells. The legacy BCP Raptor Holdco LP (BCP
Holdco) part of the segment is larger than legacy Altus Midstream
Company (Altus). The BCP Holdco Midstream Logistics part of Kinetik
has been outperforming the main county in which it operates, Reeves
County.
Fitch tracks Reeves County's production. The combined BCP Holdco
part of Kinetik's natural gas gathering has performed materially in
line with the county over a series of comparisons. This relative
performance serves as a foundation for Fitch's favorable long-term
expectations for BCP Raptor, LLC and BCP Raptor II, LLC. Fitch
considers the Delaware basin in which Reeves County is located to
have an average breakeven (an investment return metric) that places
the basin among the best oil regions in the U.S. However, Fitch
also believes that global forces could eventually cause even U.S.
regions as elite as the Delaware basin to be the site of volume
downside scenarios for Kinetik and its peers.
Natural Gas Pipeline Re-contracting Risk: Kinetik's planned
refinancing window coincides with the expirations of the base
contracts on Permian Highway pipeline and Gulf Coast Express
pipeline. Both pipelines are natural gas pipelines. Recent outcomes
at expirations for pipelines developed on 10-year contracts have
been challenging. Rockies region and Mid-continent region
expirations coincided with large write-downs when then-prevailing
prices and forecasted prices for transportation services did not
support the undepreciated book value of the pipeline.
While it is difficult to form a view almost a decade in advance,
basis differentials for the Waha-Katy locations (proxy for Permian
Highway service) are encouraging. Fitch expects Permian production
to grow materially, and if no other pipelines are built the basis
differentials should rise annually. Given the G&P side of the
business is Kinetik's main focus, a re-contracting downside case
scenario is not likely to lead to difficult refinancing.
Diverse oil producer customers, solid take-or-pay counterparties:
Only Apache (BBB-/Stable) is a major customer (i.e., will provide
10% or more of 2022 gross profit, where gross profit is defined to
include the flow from the joint venture pipelines). The take-or-pay
obligations running to the joint venture pipelines that are
expected to provide dividends do not include any large customers
that Fitch rates 'BB' or lower. Permian Highway (the largest joint
venture pipeline by dividend contribution to Kinetik) features a
large array of customers between 'A' or better and 'BB' or 'BB+'.
Leverage Policy: Kinetik has disclosed that its financial strategy
is targeting a leverage ratio (on management definition) of 3.5x or
less. Converting management's definition to Fitch's definition,
that policy translates into a policy of approximately 3.8x or less.
The financial policy, when achieved with corporate actions in
management's control, would position Kinetik strongly in its rating
category and could be grounds for an upgrade.
Kinetik's board has bolstered this policy by establishing a
dividend reinvestment program (DRIP), and the core shareholders
have committed to take 100% of dividends via the DRIP throughout
2022. Electing the DRIP by these shareholders gives management the
ability to commit to fully redeem the Series A Preferred Units in
2022. Fitch regards these units as 100% debt credit/0% equity
credit, so this program of actions is a strong indicator of
Kinetik's intent to reduce deemed debt with its meaningful surplus
of net cash flow from operations less capex.
Fitch's 2023 forecast for leverage (total debt with equity credit
over operating EBITDA) is in a range of 3.7x to 3.9x. Kinetik seeks
to fulfil its leverage policy (Fitch defined 3.8x) by year-end
2023. In the dynamic Permian midstream sector, the newly convened
Board of Directors may have to weigh opportunities, or,
potentially, respond to challenges. The company has set a dividend
growth policy starting in 2023 of at least 5% growth, and Fitch has
assumed that a growth rate of approximately 5% will be selected.
Fitch does not forecast Kinetik achieving leverage under 4.0x for
2022, partly because the company will need time to execute certain
integration plans.
DERIVATION SUMMARY
The best comparable for Kinetik is DT Midstream, Inc. (DTM;
BB+/Stable). Both companies have volumetric risk. Each company has
a large presence in regions that have had long-term fast-paced
growth, giving some assurance that the volumetric risk at each
company is bounded. Both companies have approximately 90% fee-based
business (i.e., taking title to hydrocarbons and selling them at
market prices is a small part of each company).
Kinetik has better counter-party risk than DTM when isolating
long-term take-or-pay payments. However, DTM's most salient
take-or-pay exposure is to a 'BB' company (unsecured rating), so a
contract rejection in bankruptcy is relatively unlikely. Fitch
estimates that DTM has a higher percentage of run-rate operating
cash flows coming from revenue-assurance-type contracts (i.e., take
or pay and minimum volume commitments).
Fitch calculated DTM's FY21 leverage at 4.4x, which is expected to
drop below 4.0x by 2023 and remain comfortably below 4.0x through
2025. Fitch expects Kinetik 2023 leverage to be in a range of 3.7x
to 3.9x (Fitch definition). While Fitch focused on 2023 when
assigning Kinetik's rating, its 2022 leverage will be comparable to
DTM's.
Relevant to volume risk, the two companies differ in terms of their
"focus hydrocarbons" in the regions in which they operate. While
Kinetik mainly is a gas gatherer (to focus on the wellhead side of
the business), the Delaware basin thus far has been explored in the
last decade for crude oil, not natural gas. DTM's two regions are
explored for the purpose for finding natural gas. Each hydrocarbon
has a different volumetric risk profile.
Over the last eight years, volumes for oil in the U.S. have shown
their strongest downward moves on OPEC+ actions (with the most
recent one being exacerbated by COVID-19). U.S. natural gas volumes
over the same period have shown vulnerability to warm U.S. winters
(especially consecutive warm winters, which is the case for the
winters 2020/2021 and 2021/2022). The U.S. LNG export volume has
reached a large enough size that winter weather in Europe and Asia
may be a factor in the future. Fitch expects these volume risk for
each hydrocarbon to generally have different cycles.
The companies are rated the same as they are similar on most
features, and the ones where Kinetik is superior (take or pay
counterparty risk), the difference is not highly significant.
KEY ASSUMPTIONS
-- Fitch price deck for oil and natural gas prices, e.g., 2023
West Texas Intermediate (WTI) crude oil $76 per barrel for
West Texas Intermediate, 2023 Henry Hub natural gas $3.25 per
thousand cubic feet, and 2023 Title Transfer Facility $10.00
per thousand cubic feet. For all the natural gas liquids but
ethane, the forecast is for the gallon prices to decline from
current prices in accordance with the Fitch price deck vis-a-
vis a moderately high correlation to WTI. For ethane, the same
statement, but with a high correlation to natural gas at Henry
Hub. Kinetik is assumed to perform some 2022 hedging soon at
values higher than the price deck;
-- Recent contract wins and transitions in old contracts boost
volumes. Apart from these lumpy elements, ongoing volumes in
2022 and 2023 rise in the high single digit percent year-over-
year;
-- Capital expenditures in accordance with management's
expectations;
-- The existing dividend rate will increase at and after 2023 by
5% p.a., which is at the floor level of guidance. (For 2022,
almost all shares are electing the dividend re-investment
plan.).
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Leverage (total debt with equity credit to operating EBITDA)
below 4.0x, together with an expectation that the leverage can
be sustained below 4.0x, while maintaing the existing level of
business risk.
-- Continual customer exploitation for a number of years of the
Alpine High property, together with the incremental
development of a pipeline network to serve that activity.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Leverage (total debt with equity credit to operating EBITDA)
expected to be sustained above 5.0x.
-- A cluster of large shippers on the joint venture pipelines
experiencing business shocks or radically changing financial
policy resulting in the cluster's credit quality falling to
'B'.
-- Underperformance and then a steady fall in gathering volumes
from the level that Fitch forecasts for 2022, such that
Kinetik's EBITDA would likely under-run if there was a sudden
commodity price deflation.
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: The new $1.25 billion revolving credit facility
is less than the aggregate amount of such facilities of the merging
parties. This is not problematic because (a) the facilities were
set at a time of peak capex (including multi-year committed capex),
and Fitch is now at a trough period; and (b) BCP Raptor used its
revolver as permanent debt, and this debt is being refinanced with
a portion of the $1 billion of unsecured notes and $2 billion term
loan A.
The contemplated revolving credit facility will be unsecured. It
will have a five-year term, and lenient covenants.
The two rated Raptors companies have demonstrated a predictable
liquidity schedule, performing well during the challenging
"COVID-stay-at-home-orders" and the February 2021 Texas cold snap.
The company has many dividends from joint ventures with take-or-pay
payments. The portion of dividends that may be allocated to IG
shippers (under about nine years-to-go contracts) comfortably are
greater than the sum of the obligations to pay interest expense,
expend funds on maintenance capex, and corporate overhead.
ISSUER PROFILE
Kinetik is a gathering and processing focused midstream company
handling natural gas, NGLs, and crude oil with assets primarily
focused in the Delaware Basin in the Permian.
SUMMARY OF FINANCIAL ADJUSTMENTS
Per Fitch's "Corporate Hybirds Treatment and Notching Criteria"
Fitch treats Kinetik's Series A preferred units with 0% equity
credit. Under Fitch's typical calculation of EBITDA, distributions
from investees accounted for under the equity method of accounting
are included in EBITDA, and equity earnings from these entities are
excluded.
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
---- ------ --------
Kinetik Holdings LP LT IDR BB+ New Rating
senior unsecured LT BB+ New Rating RR4
KINETIK HOLDINGS: Moody's Gives First Time Ba1 Corp. Family Rating
------------------------------------------------------------------
Moody's Investors Service assigned first-time ratings to Kinetik
Holdings LP, including a Ba1 Corporate Family Rating, Ba1-PD
Probability of Default Rating and Ba1 rating to its proposed $1
billion senior unsecured notes. Moody's also assigned an SGL-1
Speculative Grade Liquidity (SGL) rating. The outlook is stable.
Kinetik is a fully-owned subsidiary of Kinetik Holdings Inc. (NYSE:
KNTK), a midstream company in the Delaware Basin of Permian in
Texas. KNTK was formed by the combination of two midstream
companies in the Delaware Basin - Altus Midstream, previously a
publicly owned subsidiary of Apache Corporation (Ba1, Stable) and
BCP Raptor Holdco (Raptor, unrated) a private midstream company
owned by the private equity firm Blackstone Capital. Raptor owns
BCP Raptor LLC (B2, RUR-Up) and BCP Raptor II LLC (B2, RUR-Up)
along with other midstream assets.
Kinetik has proposed to issue $1 billion senior unsecured notes to
partially pay off debt at Raptor subsidiaries, debt at Altus
Midstream and partially redeem preferred notes at Kinetik
Midstream. Kinetik will also be using the proceeds from its new
$2.0 billion unsecured term loan A (unrated) to pay off its
existing debt. Proforma for the proposed financing transaction,
Kinetik's capital structure will consist of $1.25 billion unsecured
revolving credit facility, $2.0 billion of unsecured term loan A,
$1 billion of unsecured notes and approximately $500 million of
preferred notes.
Upon closing of the proposed transaction and full paydown of debt
at BCP Raptor LLC and BCP Raptor II LLC, all of their ratings will
be withdrawn.
"Kinetik's ratings reflect the company's scale, resilient asset
profile and low debt leverage somewhat offset by the company's
meaningful volume risk through its gathering and process segment
and basin concentration in the Delaware Basin," commented Sreedhar
Kona, Moody's Senior Analyst. "Kinetik's strong cash flow
visibility is underpinned by fee-based contracts that help the
company maintain its low debt leverage and good distribution
coverage, and the company's very good liquidity contribute to the
stable outlook."
Assignments:
Issuer: Kinetik Holdings LP
Corporate Family Rating, Assigned Ba1
Probability of Default Rating, Assigned Ba1-PD
Speculative Grade Liquidity Rating, Assigned SGL-1
Gtd. Senior Unsecured Regular Bond/Debenture, Assigned Ba1 (LGD4)
Outlook Actions:
Issuer: Kinetik Holdings LP
Outlook, Assigned Stable
RATINGS RATIONALE
Kinetik' Ba1 CFR reflects the company's diversified midstream
platform of considerable size in the prolific Delaware Basin, its
high proportion of fixed fee revenue with significant long-term
take-or-pay contracts underpinned by pipeline firm transportation
charges, and acreage dedications providing cash flow visibility.
The company has an integrated mix of long-haul pipelines and
gathering and processing facilities that provide resilience to
carbon transition risks. The company also benefits from a
diversified portfolio of customers with strong credit worthiness.
Kinetik will have low debt leverage at the closing of the
transaction and the company's modest capital spending plan will
help the company maintain low leverage. The company's significant
cash flow generation will provide strong distribution coverage.
The company's credit profile is constrained by volume risk through
its gathering and processing segment, and basin concentration in
the Delaware Basin. However, the prolific nature of the basin with
its low breakeven costs mitigates the risk to some extent. The
company's gathering and processing segment has some commodity price
risk from their percentage of proceeds contracts. Additionally, the
company derives a high percentage of its revenues from transporting
natural gas produced in a basin that is focused on developing oil
resources. The company's ownership structure is somewhat complex
with equity interests at different entities within the corporate
structure, however the company's board and the governance structure
prevent outsized influence or control of company's financial
policy.
Kinetik has moderate exposure to Environmental, Social and
Governance (ESG) risks. There is limited credit impact to date, but
there is potential for the carbon transition and demographic &
societal trend risk factors to cause greater future negative credit
impact over time. Kinetik has significant environmental risks due
to carbon transition, as the company's earnings are almost entirely
focused on oil & gas customers. Environmental risks are mainly
related to carbon transition risk and waste & pollution. The major
drivers are the carbon transition exposure as economies pivot away
from crude oil, and risks from spills of liquid hydrocarbons and
air emissions from natural gas processing facilities. Kinetik is
also exposed to high social risk mainly related to responsible
production and demographic & societal trends. The major drivers are
the opposition from local communities and indigenous populations,
and from increasing regulatory hurdles and public opposition to the
construction of new midstream projects. The company operates in
energy friendly state of Texas and its operations are not in
proximity to indigenous communities.
Governance considerations in assessing Kinetik's ratings include
the risks arising from its limited track record as a single
midstream system. Additionally, the company's limited public float
and concentrated ownership structure, albeit a robust Board of
Directors, also contribute to the governance factors considered in
the rating.
Kinetik' $1 billion senior unsecured notes (due in 2030) are rated
Ba1, the same as the company's CFR, because all the company's
long-term debt, which includes a $1.25 billion unsecured revolving
credit facility (unrated) maturing in June 2027 and $2.0 billion
unsecured term loan A due in June 2025, is unsecured.
Kinetik will have very good liquidity as reflected in its SGL-1
rating. Pro forma for the closing of the financing transaction,
the company will have nominal cash and no outstanding borrowings
under its $1.25 billion unsecured revolving credit facility
maturing five years from the closing. Kinetik' cash needs including
its debt service and, maintenance and growth capex needs will be
completely covered by take-or-pay cash flows from its Pipeline
Transportation segment. The revolving credit agreement and the term
loan credit agreement will have one financial covenant – a
maximum consolidated leverage ratio of 5x (and 5.5x with a
qualified acquisition). Kinetik will be in compliance with its
covenants. Kinetik capital structure does not include any secured
debt.
The stable outlook reflects Kinetik' strong cash flow visibility
underpinned by fee-based contracts that would help the company
maintain its low debt leverage and good distribution coverage. The
company's very good liquidity also contributes to the stable
outlook.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
While Moody's does not expect Kinetik's ratings to be upgraded in
the near-term based on Kinetik's current business profile, ratings
could be considered for an upgrade if the company increases its
scale to generate sustained EBITDA above $1 billion, while also
improving its business profile by reducing volumetric risk and
improving cash flow stability. The company must also maintain
Debt/EBITDA below 3.5x and good distribution coverage.
A downgrade of Kinetik is possible if the company engages in debt
funded acquisitions, aggressively increases shareholder returns, or
weakens its business profile. Debt/EBITDA above 4.5x could result
in a ratings downgrade.
Midland, Texas-based midstream company Kinetik Holdings Inc. (NYSE:
KNTK) provides gathering, transportation, compression, processing,
and treating services for companies that produce natural gas,
natural gas liquids, crude oil, and water.
The principal methodology used in these ratings was Midstream
Energy published in February 2022.
KW EXCAVATION: Starts Chapter 11 Subchapter V Case
--------------------------------------------------
KW Excavation, Inc., filed for bankruptcy protection under
Subchapter V of Chapter 11 of the Bankruptcy Code.
According to court filing, KW Excavation Inc. estimates between 1
and 49 unsecured creditors. The petition states that funds will be
available to unsecured creditors.
About KW Excavation Inc.
KW Excavation, Inc. provides utility system construction services.
KW Excavation previously sought Chapter 11 bankruptcy protection
(Bankr. D. Utah Case No. 07-24738) on Oct. 5, 2007. The case was
dismissed in January 2008.
KW Excavation Inc. filed a petition for relief under Subchapter V
of Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Utah Case No.
22-21925) on May 25, 2022. In the petition signed by Janeice
Whitaker, president/owner, the Debtor disclosed up to $100,000 in
assets and up to $10 million in liabilities.
Judge William T. Thurman oversees the case.
Knufe Rife, Esq., at Rife Law Office, is the Debtor's counsel.
Brian M. Rothschild has been appointed as Subchapter V trustee.
LTL MANAGEMENT: Examiner Gets in $952K Fee Cuts in Chapter 11
-------------------------------------------------------------
Vince Sullivan of Law360 reports that the examiner appointed to
keep watch over the fee and expense applications filed in the
Chapter 11 case of Johnson & Johnson's talc unit, LTL Management
told a New Jersey bankruptcy judge that he was able to achieve
$952,000 in reductions from the 17 firms retained in the
proceedings, and would support approval of their applications with
those cuts.
In a final report issued late Tuesday on the interim fee
applications made by the firms between October 2021, when the case
of LTL Management LLC began, and Jan. 31, 2022, fee examiner Robert
J. Keach of Bernstein Shur Sawyer & Nelson PA said.
About LTL Management
LTL Management, LLC, is a subsidiary of Johnson & Johnson (J&J),
which was formed to manage and defend thousands of talc-related
claims and oversee the operations of Royalty A&M. Royalty A&M owns
a portfolio of royalty revenue streams, including royalty revenue
streams based on third-party sales of LACTAID, MYLANTA/MYLICON and
ROGAINE products.
LTL Management filed a petition for Chapter 11 protection (Bankr.
W.D.N.C. Case No. 21-30589) on Oct. 14, 2021. The case was
transferred to New Jersey (Bankr. D.N.J. Case No. 21-30589) on Nov.
16, 2021. The Hon. Michael B. Kaplan is the case judge. At the
time of the filing, the Debtor was estimated to have $1 billion to
$10 billion in both assets and liabilities.
The Debtor tapped Jones Day and Rayburn Cooper & Durham, P.A., as
bankruptcy counsel; King & Spalding, LLP and Shook, Hardy & Bacon
LLP as special counsel; McCarter & English, LLP as litigation
consultant; Bates White, LLC as financial consultant; and
AlixPartners, LLP as restructuring advisor. Epiq Corporate
Restructuring, LLC, is the claims agent.
An official committee of talc claimants was formed in the Debtor's
Chapter 11 case on Nov. 9, 2021. On Dec. 24, 2021, the U.S. Trustee
for Regions 3 and 9 reconstituted the talc claimants' committee and
appointed two separate committees: (i) the official committee of
talc claimants I, which represents ovarian cancer claimants, and
(ii) the official committee of talc claimants II, which represents
mesothelioma claimants.
The official committee of talc claimants I tapped Genova Burns LLC,
Brown Rudnick LLP, Otterbourg PC and Parkins Lee & Rubio LLP as its
legal counsel. Meanwhile, the official committee of talc claimants
II is represented by the law firms of Cooley LLP, Bailey Glasser
LLP, Waldrep Wall Babcock & Bailey PLLC, Massey & Gail LLP, and
Sherman Silverstein Kohl Rose & Podolsky P.A.
About Johnson & Johnson
Johnson & Johnson is an American multinational corporation founded
in 1886 that develops medical devices, pharmaceuticals, and
consumer packaged goods. It is the world's largest and most
broadly based healthcare company.
Johnson & Johnson is headquartered in New Brunswick, New Jersey,
the consumer division being located in Skillman, New Jersey. The
corporation includes some 250 subsidiary companies with operations
in 60 countries and products sold in over 175 countries.
The corporation had worldwide sales of $82.6 billion in 2020.
LUZERNE IRONWORKS: Case Summary & Eight Unsecured Creditors
-----------------------------------------------------------
Debtor: Luzerne Ironworks, Inc.
711 W. Washington St
Eufaula, AL 36027
Business Description: The Debtor classifies its business as "Other
Fabricated Metal Product Manufacturing."
Chapter 11 Petition Date: June 2, 2022
Court: United States Bankruptcy Court
Middle District of Alabama
Case No.: 22-10501
Debtor's Counsel: J. Kaz Espy, Esq.
THE ESPY FIRM
326 N Oates St
PO Box Drawer 6504
Dothan, AL 36302-6504
Tel: 334-793-6288
Fax: 334-712-1617
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Richard D. Biddle as president of DWB
Investments, Inc.
A full-text copy of the petition containing, among other items, a
list of the Debtor's eight unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/X5JR6ZY/Luzerne_Ironworks_Inc__almbke-22-10501__0001.0.pdf?mcid=tGE4TAMA
MAGNETITE XXXIII: S&P Assigns Prelim BB-(sf) Rating on Cl. E Notes
------------------------------------------------------------------
S&P Global Ratings assigned its preliminary ratings to Magnetite
XXXIII Ltd.'s fixed- and floating-rate notes.
The note issuance is a CLO securitization governed by investment
criteria and backed primarily by broadly syndicated
speculative-grade (rated 'BB+' or lower) senior secured term loans.
The transaction is managed by BlackRock Financial Management Inc.
The preliminary ratings are based on information as of June 2,
2022. Subsequent information may result in the assignment of final
ratings that differ from the preliminary ratings.
The preliminary ratings reflect S&P's view of:
-- The collateral pool's diversification;
-- The credit enhancement provided through subordination, excess
spread, and overcollateralization;
-- The experience of the collateral manager's team, which can
affect the performance of the rated notes through portfolio
identification and ongoing management; and
-- The transaction's legal structure, which is expected to be
bankruptcy remote.
Preliminary Ratings Assigned
Magnetite XXXIII Ltd./Magnetite XXXIII LLC
Class A, $320.00 million: AAA (sf)
Class B-1, $53.00 million: AA (sf)
Class B-2, $7.00 million: AA (sf)
Class C (deferrable), $30.00 million: A (sf)
Class D (deferrable), $30.00 million: BBB- (sf)
Class E (deferrable), $20.00 million: BB-(sf)
Subordinated notes, $38.75 million: Not rated
MODERN LAND: Chapter 15 Case Summary
------------------------------------
Chapter 15 Debtor: Modern Land (China) Co., Limited
Cricket Square, Hutchins Drive
P.O. Box 2681
Grand Cayman, KY1-1111
Cayman Islands
Case No.: 22-10707
Business Description: Modern Land was established in 2000 and
is headquartered in Beijing. It was
listed on the Hong Kong Stock Exchange
in 2013 under the stock code 1107.HK.
The Group is a real estate developer
that independently develops and operates
green technology systems and
expansion systems, and builds the iconic
brand of green technology real estate in
China-"MOMΛ".
Foreign Proceeding: Scheme proceedings under section 86 of
the Cayman Islands Companies Act
Chapter 15 Petition Date: June 3, 2022
Court: United States Bankruptcy Court
Southern District of New York
Judge: Hon. Martin Glenn
Foreign Representative: Zhang Peng
No. 1 Xiang He Yuan Road
Dong Cheng, Beijing
People's Republic of China
Foreign
Representative's
Counsel: Anthony Grossi, Esq.
SIDLEY AUSTIN LLP
787 Seventh Avenue
New York, NY 10019
Tel: (212) 839-5599
Email: agrossi@sidley.com
- and -
Julina Hoffman, Esq.
SIDLEY AUSTIN LLP
2021 McKinney Avenue
Suite 2000
Dallas, Texas 75201
Tel: (214) 969-3581
Fax: (214) 981-3400
Estimated Assets: Unknown
Estimated Debt: Unknown
A full-text copy of the Chapter 15 is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/2LXWL6Q/Modern_Land_China_Co_Limited_and__nysbke-22-10707__0001.0.pdf?mcid=tGE4TAMA
MODERN LAND: CN Developer Seeks US Recognition of Cayman Scheme
---------------------------------------------------------------
Chinese property Modern Land (China) Co., Limited has filed a
Chapter 15 bankruptcy petition in the U.S. to seek recognition of
its restructuring in the Cayman Islands.
Modern Land and its bondholders have entered into a restructuring
support agreement, which sets out the terms on which the parties
would assist and facilitate the implementation of a restructuring
of existing notes via a scheme of arrangement in the Cayman Islands
and the Chapter 15 case.
Zhang Peng, executive director and president of the Debtor,
explains that a series of events have placed certain Chinese
property developers, including the Company, under financial stress
and created impediments to addressing certain payment maturities.
The financial restructuring effectuated through the Chapter 15 Case
and the corresponding Cayman Proceeding are a meaningful step to
right-size the Company's balance sheet and place it in a position
for long-term success to the benefit of the Company's employees,
creditors, customers, vendors, and all of its stakeholders.
16.77M sqm in Unsold Floor Area
The Company is a property developer focused on the development of
green, energy-saving, and eco-friendly residences in the People's
Republic of China. The Debtor is the ultimate holding company of a
group of companies comprising the Company and its subsidiaries,
including Great Trade Technology Ltd., a holding company
incorporated with limited liability in the British Virgin Islands,
the Modern Land HK Companies, and Jiu Yun Development Co., Limited,
a holding company incorporated with limited liability in Hong Kong
that carries out the business of real estate investment and
development in the PRC and the United States.
The Debtor's shares have been listed on the main board of the Stock
Exchange of Hong Kong Limited since July 12, 2013. As of December
31, 2021, the authorized share capital of the Debtor was US$80
million divided into eight billion ordinary shares of a nominal or
par value of US$0.01 each, of which 2.79 billion of the ordinary
shares were issued and fully paid.
The Company has a diversified product portfolio comprised of four
product lines: Modern MOMA; Modern Eminence MOMA; Modern Horizon
MOMA; and Modern City MOMA. Each of the four residential property
product lines are marketed under the Company's "MOMA" brand, which
the Company believes enjoys broad recognition among its customers
and has become one of the few brand names that is representative of
green building design and construction.
As of June 30, 2021, the Company, its joint ventures, and
associates had a contracted sales gross floor area of 2.08 million
square meters and aggregate unsold gross floor area of 16.77
million square meters in the PRC. During the first half of 2021,
the Company, its joint ventures, and associates purchased a total
of 20 new projects with an aggregate gross floor area of
approximately 3.56 million square feet.
$1.34 Billion of Existing Notes
As of June 30, 2021, the Company had a total indebtedness of
US$4.32 billion, including: (i) short-term borrowings of US$972.33
million; (ii) long-term borrowings of US$1.92 billion; and (iii)
bonds payable of US$1.42 billion. Additionally, as of June 30,
2021, the Company's contingent liabilities amounted to US$2.57
billion.
As part of the Company's US$1.42 billion of bonds payable, the
total principal amount outstanding under the Existing Notes is
US$1.34 billion, comprised of:
a) An aggregate principal amount of US$250 million in 12.85%
senior notes with a maturity date of October 25, 2021, issued
pursuant to an indenture dated April 25, 2019, between, the Debtor
and Citicorp International Limited, as the Existing Notes Trustee;
b) An aggregate principal amount of US$200 million in 11.8%
senior notes with a maturity date of February 26, 2022, issued
pursuant to an indenture dated February 26, 2020, between the
Debtor and Citicorp International Limited, as the Existing Notes
Trustee;
c) An aggregate principal amount of US$297 million in 11.5%
senior notes with a maturity date of November 13, 2022, issued
pursuant to an indenture dated July 13, 2020, between the Debtor
and Citicorp International Limited, as the Existing Notes Trustee;
d) An aggregate principal amount of approximately US$318.5
million in 9.8% senior notes with a maturity date of April 11,
2023, issued pursuant to an indenture dated January 11, 2021,
between the Debtor and Citicorp International Limited, as the
Existing Notes Trustee; and
e) An aggregate principal amount of approximately US$276
million in 11.95% senior notes with a maturity date of March 4,
2024, issued pursuant to an indenture dated March 4, 2020, between
the Debtor and Citicorp International Limited, as the Existing
Notes Trustee.
The Debtor is the issuer of the Existing Notes, which are the
subject of the Restructuring pursuant to the Scheme and the Chapter
15 Case. The remaining outstanding indebtedness is not being
restructured and will be unaffected by the Scheme and this Chapter
15 Case.
The principal assets of the Debtor include shares in these wholly
owned subsidiaries:
a) Great Trade, a holding company incorporated with limited
liability in the British Virgin Islands which, in turn, holds 100%
of the share capital in Jiu Yun, a holding company incorporated
with limited liability in Hong Kong;
b) Modern Land (HKNo. 2) Co., Limited, Modern Land (HKNo. 3)
Co., Limited, Modern Land (HKNo. 4) Co., Limited, Modern Land
(HKNo. 6) Co., Limited, Modern Land (HKNo. 7) Co., Limited, Modern
Land (HKNo. 8) Co., Limited, Modern Land (HKNo. 9) Co., Limited,
Modern Land (HKNo. 10) Co., Limited, Modern Land (HKNo. 11) Co.,
Limited, and Modern Land (HKNo. 12) Co., Limited, all of which are
holding companies incorporated with limited liability in Hong Kong;
and
c) Modern Land (HKNo. 5) Co., Limited, a holding company
incorporated with limited liability in Hong Kong which, in turn,
holds 99% of the share capital in Modern Land (HKNo. 1) Co.,
Limited, a holding company incorporated with limited liability in
Hong Kong.
Additionally, based on the Debtor's financial data, the Company's
current assets on a consolidated basis as of June 30, 2021,
amounted to approximately US$12.49 billion. The majority of the
Company's current assets cannot be collected or converted into cash
immediately. As of June 30, 2021, these assets were located in the
PRC and United States and certain of the assets were pledged to
secure certain banking and other facilities granted to the Company
and mortgage loans granted to buyers of sold properties.
As of June 30, 2021, key items of the Company's current assets
consist of:
a) inventory of approximately US$145.79 million;
b) properties under development for sale of approximately
US$6.92 billion;
c) properties held for sale of approximately US$895 million;
d) trade and other receivables of approximately US$1.78
billion;
e) amount due from related parties of approximately US$129.27
million;
f) restricted cash of approximately US$570.69 million; and
g) bank balances and cash of approximately US$2.06 billion.
Events Preceding the Restructuring
During the second half of 2021, Chinese property developers and the
capital markets that funded the growth and development of the
sector have experienced an inflection point. Reduced bank lending
for real estate development has resulted in reduced access by
property developers to PRC capital. In addition, reduced bank
lending for buyers seeking mortgage financing, as well as buyers'
concerns about the ability of property developers to complete
projects, has resulted in reduced property sales. Adverse reaction
to these PRC events by international capital markets has limited
the Company's funding sources to address upcoming maturities.
Since the beginning of 2022, the property sector in China has
continued to experience volatility. Reduced bank lending for real
estate development, coupled with the adverse impact of COVID-19
pandemic on macroeconomic conditions and certain negative credit
events, have intensified market concerns over the operations of
Chinese property developers. As a result, Chinese property
developers have encountered greater difficulty pre-selling their
inventory.
The Company has also experienced a noticeable decline in its
aggregate contracted sales in recent months. Against the backdrop
of the adverse market conditions, the Company experienced liquidity
pressures due to limited access to external capital to refinance
its existing indebtedness and reduced cash generated from
contracted sales. As a result, the repayment arrangements of the
principal amount of the October 2021 Notes and February 2022 Notes
and the accrued but unpaid interest thereon were not met upon the
respective maturity dates of Oct. 25, 2021 and Feb. 26, 2022.
These amounts remain unpaid.
Restructuring
The Company has been actively engaging with its customers,
suppliers, creditors, and shareholders in an attempt to stabilize
its credit lines and day-to-day operations. The Company commenced
discussions with the ad hoc group of holders of the Existing Notes
as constituted from time to time who are advised by Kirkland &
Ellis LLP in exploring a consensual resolution for the Existing
Notes Events of Default.
As the Debtor disclosed on Oct. 26, 2021, the Debtor appointed
Sidley Austin LLP as its legal advisor to review its potential
options and to assist the Debtor in its debt restructuring
negotiations with the holders of the Existing Notes. On Nov. 5,
2021, the Debtor announced the appointment of Houlihan Lokey
(China) Limited as its financial advisor and invited holders of the
Existing Notes to come forward and establish contact so the Debtor
could initiate consensual restructuring discussions.
Following extensive negotiations with the Ad Hoc Group (being a
representative group of certain Scheme Creditors), the Debtor and
its advisors determined the restructuring and implementation of the
Scheme was in the best interests of the Company and those with an
economic interest in the Company, including, in particular, the
Scheme Creditors. Accordingly, the Debtor entered into a
restructuring support agreement, dated as of Feb. 25, 2022, with
certain Scheme Creditors (i.e., certain holders of the Existing
Notes).
Under the terms of the RSA, the Debtor has undertaken to pay, or
procure the payment of, on or prior to the Restructuring Effective
Date, the RSA Fees (that only represent approximately 0.16% of the
aggregate outstanding principal amount of the Existing Notes) , in
cash, to the Scheme Creditors who are parties to the RSA.
Additionally, pursuant to the Scheme, the Debtor has agreed to pay
the AHG Work Fee and AHG Legal Fees to compensate the Ad Hoc Group
and their advisors for the work, time, and risks associated with
negotiating the Restructuring and assisting to formulate the Cayman
Scheme and the terms of the Restructuring. The total amount of the
AHG Work Fee and AHG Legal Fees are anticipated to represent less
than 0.4% of the aggregate outstanding principal amount of the
Existing Notes.
As of May 31, 2022, certain Scheme Creditors holding an aggregate
principal amount of approximately US$1,083,272,000 of the Existing
Notes (representing approximately 80.75% of the aggregate
outstanding principal amount of all Existing Notes) had acceded to
the RSA. Pursuant to the terms of the Restructuring Support
Agreement, Scheme Creditors that were not already party to the RSA
as of the RSA Fee Deadline may no longer accede to it in order to
receive the RSA Fee.
Each Scheme Creditor will be entitled to receive the distribution
of its pro rata share of the following consideration in accordance
with the terms of the Scheme:
(a) US$22.916 million of cash; and
(b) The New Notes, in an aggregate principal amount equal to
the sum of (i) c.98.3% of the outstanding principal amount of the
Existing Notes held by such Scheme Creditor as of the Record Time
and (ii) the accrued and unpaid interest on the Existing Notes up
to but excluding the Restructuring Effective Date.
Pursuant to the Scheme, the Company is restructuring its existing
obligations and indebtedness under the Existing Notes Documents.
The Debtor will also be issuing new notes on the Restructuring
Effective Date, including:
(a) Senior secured notes bearing interest at 7/9% due 2023 with
an original principal amount of US$80 million to be issued by the
Debtor, guaranteed by the Subsidiary Guarantors, with Citicorp
International Limited serving as the notes trustee;
(b) Senior secured notes bearing interest at 8/10% due 2024
with an original principal amount of US$180 million to be issued by
the Debtor, guaranteed by the Subsidiary Guarantors, with Citicorp
International Limited serving as the New Notes Trustee;
(c) Senior secured notes bearing interest at 9/11% due 2025
with an original principal amount of US$300 million to be issued by
the Debtor, guaranteed by the Subsidiary Guarantors, with Citicorp
International Limited serving as the New Notes Trustee;
(d) Senior secured notes bearing interest at 9/11% due 2026
with an original principal amount of US$400 million to be issued by
the Debtor, guaranteed by the Subsidiary Guarantors, with Citicorp
International Limited serving as the New Notes Trustee; and
(e) Senior secured notes bearing interest at 9/11% due 2027
with an original principal amount of US$520.01 million to be issued
by the Debtor, guaranteed by the Subsidiary Guarantors, with
Citicorp International Limited serving as the New Notes Trustee.
On the Restructuring Effective Date, subsequent to the completion
of, among other things, the distribution of the Scheme
Consideration and the issuance of the New Notes, all outstanding
Existing Notes will be cancelled and all guarantees in connection
with the Existing Notes will be released, including the Subsidiary
Guarantors' guarantee of the Debtor's obligations under the
Existing Notes, in accordance with the Scheme.
About Modern Land
Modern Land (China) Co., Limited, was established in 2000 and is
headquartered in Beijing. It was listed on the Hong Kong Stock
Exchange in 2013 under the stock code 1107.HK. The Group is a real
estate developer that independently develops and operates green
technology systems and expansion systems, and builds the iconic
brand of green technology real estate in China-"MOMΛ".
On April 14, 2022, Modern Land (China) filed a petition in the
Cayman Islands commencing scheme proceedings under section 86 of
the Cayman Islands Companies Act to pursue a restructuring pursuant
to the terms of a restructuring support agreement with holders of
existing notes. Modern Land is the subject of a restructuring
proceeding entitled In the Matter of Modern Land (China) Co.,
Limited, concerning a scheme of arrangement between the Debtor and
bondholders, currently pending before the Grand Court of the Cayman
Islands, Cause Number 96 of 2022 (ASCJ).
On June 3, 2022, Modern Land (China) Co. filed a Chapter 15
bankruptcy petition (S.D.N.Y. Case No. 22-10707) to seek U.S.
recognition of its Cayman proceedings. The Hon. Martin Glenn is
the case judge. Sidley Austin LLP, led by Anthony Grossi and
Julina Hoffman, is counsel in the U.S. case. Houlihan Lokey
(China) Limited serves as the Debtor's financial advisor.
An hoc group of holders of the Company's existing notes is advised
by Kirkland & Ellis LLP
MOVIMIENTO PENTECOSTAL: Exclusivity Period Extended to June 16
--------------------------------------------------------------
Movimiento Pentecostal Apostolico Cristiano Incorporado obtained an
order from the U.S. Bankruptcy Court for the District of Puerto
Rico extending to June 16 its exclusivity period to file a small
business plan and disclosure statement.
About Movimiento Pentecostal
Movimiento Pentecostal Apostolico Cristiano, Incorporado filed a
petition for Chapter 11 protection (Bankr. D.P.R. Case No.
21-02645) on Sept. 1, 2021, listing as much as $500,000 in both
assets and liabilities.
Judge Mildred Caban Flores oversees the case. The Debtor tapped
Almeida & Davila, P.S.C. and Tamarez CPA, LLC as legal counsel and
accountant, respectively.
MYOMO INC: MUST Asset, et al. Report 6.73% Equity Stake
-------------------------------------------------------
In a Schedule 13G/A filed with the Securities and Exchange
Commission, these entities and individuals reported beneficial
ownership of shares of common stock of Myomo, Inc. as of Dec. 31,
2021:
Shares Percent
Beneficially of
Reporting Person Owned Class
---------------- ------------ -------
MUST Asset Management Inc. 461,551 6.73%
MUST Holdings Inc. 461,551 6.73%
Dooyong Kim 461,551 6.73%
Eunmi Koo 461,551 6.73%
The percentages are calculated based upon total outstanding shares
of 6,859,803, as of Nov. 3, 2021, as set forth in the Issuer's Form
10-Q, filed on Nov. 10, 2021.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/1369290/000119312522153498/d320126dsc13ga.htm
About Myomo
Headquartered in Cambridge, Massachusetts, Myomo, Inc. --
http://www.myomo.com-- is a wearable medical robotics company that
offers expanded mobility for those suffering from
neurologicaldisorders and upper limb paralysis. Myomo develops and
markets the MyoPro product line. MyoPro is a powered upper limb
orthosis designed to support the arm and restore function to the
weakened or paralyzed arms of patients suffering from CVA stroke,
brachial plexus injury, traumatic brain or spinal cord injury, ALS
or other neuromuscular disease or injury.
Myomo reported a net loss of $10.37 million for the year ended Dec.
31, 2021, a net loss of $11.56 million for the year ended Dec. 31,
2020, a net loss of $10.71 million for the year ended Dec. 31,
2019, and a net loss of $10.32 million for the year ended Dec. 31,
2018. As of March 31, 2022, the Company had $17.98 million in
total assets, $5.11 million in total liabilities, and $12.87
million in total stockholders' equity.
NAIL CARE: Case Summary & Four Unsecured Creditors
--------------------------------------------------
Debtor: Nail Care Spa Salon, LLC
2133 Highway 20
Suite 200
Conyers, GA 30013
Business Description: The Debtor is nail salon in Conyers,
Georgia.
Chapter 11 Petition Date: June 3, 2022
Court: United States Bankruptcy Court
Northern District of Georgia
Case No.: 22-54228
Debtor's Counsel: Ian M. Falcone, Esq.
THE FALCONE LAW FIRM, P.C.
363 Lawrence Street
Marietta, GA 30060
Tel: (770) 426-9359
Fax: (770) 426-8968
Email: attorneys@falconefirm.com
Total Assets: $10,000
Total Liabilities: $1,948,651
The petition was signed by Vi To as member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/XKNPGQI/Nail_Care_Spa_Salon_LLC__ganbke-22-54228__0001.0.pdf?mcid=tGE4TAMA
NATIONAL CINEMEDIA: AMC, Multi-Cinema Acquire 6.8% Equity Stake
---------------------------------------------------------------
In a Schedule 13G filed with the Securities and Exchange
Commission, AMC Entertainment Holdings, Inc. and its wholly-owned
subsidiary, American Multi-Cinema, Inc., disclosed that as of April
13, 2022, they beneficially own 5,954,646 shares of common stock of
National CineMedia, Inc., representing 6.8 percent based on
81,754,381 shares of Issuer's outstanding Common Stock as reported
in Issuer's Quarterly Report on Form 10-Q, filed on May 9, 2022,
for quarterly period ended March 31, 2022. A full-text copy of the
regulatory filing is available for free at:
https://www.sec.gov/Archives/edgar/data/1377630/000110465922061951/tm2215844d1_sc13g.htm
About National CineMedia Inc.
National CineMedia (NCM) is a cinema advertising network in the
U.S. NCM's Noovie pre-show is presented exclusively in 50 leading
national and regional theater circuits including AMC Entertainment
Inc. (NYSE:AMC), Cinemark Holdings, Inc. (NYSE:CNK) and Regal
Entertainment Group (a subsidiary of Cineworld Group PLC, LON:
CINE). NCM's cinema advertising network offers broad reach and
audience engagement with over 20,700 screens in over 1,600 theaters
in 195 Designated Market Areas (all of the top 50). NCM Digital and
Digital-Out-Of-Home (DOOH) go beyond the big screen, extending
in-theater campaigns into online, mobile, and place-based marketing
programs to reach entertainment audiences. National CineMedia,
Inc. (NASDAQ:NCMI) owns a 47.4% interest in, and is the managing
member of, National CineMedia, LLC.
National Cinemedia reported a net loss attributable to the company
of $48.7 million for the year ended Dec. 30, 2021, compared to a
net loss attributable to the company of $65.4 million for the year
ended Dec. 31, 2020. The Company reported a net loss attributable
to the company of $25.2 million for the three months ended March
31, 2022. As of March 31, 2022, the Company had $821.6 million in
total assets, $1.24 billion in total liabilities, and a total
deficit of $421.4 million.
NERAM GROUP: Wins Interim Cash Collateral Access Thru Sept 30
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Santa Ana Division, authorized Neram Group, Inc. to use cash
collateral pursuant to the budget through September 30, 2022, or
such other later date as may be agreed upon in writing by the
Debtor's alleged secured creditors, as set forth in the Motion, or
as ordered by the Court.
As adequate protection, Han Tran will receive $1,000 in adequate
protection payments starting in the month of June 2022, which
payments will continue monthly through the end of the Budgeted
Period. The Debtor, the estate of the Debtor, and TRAN all reserve
their rights to contest, or defend, the validity, security, and
priority of TRAN's claim.
The extent, validity, security, and priority of the claims of all
of the alleged secured creditors will be determined by Court orders
in the future and are not determined therein.
To the extent they have legitimate secured claims, the alleged
secured creditors will be granted replacement liens in the Debtor's
post-petition assets to the same extent, validity, security, and
priority as their respective claims had in the pre-filing period of
time.
LEYVA is directed to file and serve a "Bench brief" within 30 days
of the hearing date set forth above on the effects of the
recordation of a "Notice of Pendency of Action" on lien
priorities.
A copy of the order is available at https://bit.ly/3PSTkSs from
PacerMonitor.com.
About Neram Group
Orange, Calif.-based Neram Group, Inc. is the fee simple owner of a
12-unit apartment building located at 1211 N. El Dorado Ave,
Ontario, Calif., having a comparable sale value of $2.5 million.
Neram Group filed a petition for Chapter 11 protection (Bankr. C.D.
Calif. Case No. 22-10268) on Feb. 16, 2022, listing $2,802,000 in
assets and $1,675,000 in liabilities. Humberto Perez Figuerola,
chief executive officer, signed the petition.
Judge Scott C. Clarkson oversees the case.
The Debtor tapped the Law Offices of Robert M. Yaspan as bankruptcy
counsel.
NORDIC AVIATION: Norton Rose Advised Secured Creditors
------------------------------------------------------
Global law firm Norton Rose Fulbright has advised an ad hoc group
of secured creditors on the US$6 billion debt restructuring of the
world's largest regional aircraft leasing company, Nordic Aviation
Capital DAC (NAC), which completed on the 1st June 2022.
The restructuring was implemented through a pre-arranged Chapter 11
process in the US Bankruptcy Court.
The group of creditors, with combined claims of approximately US$1
billion, included Deutsche Bank, MUFG, Development Bank of Japan,
Korea Development Bank, Investec, Export Development Canada, New
York Life and JP Morgan, as well as several other lenders under
syndicated facilities.
The firm worked on new financing structures for 118 aircraft - on
lease to a large number of airlines around the world -- previously
under multiple financing facilities. These included direct loans,
finance leases, JOLCO financings and Export Credit financings, with
some aircraft remaining within the NAC group on restructured terms
and other aircraft transitioning to the control of creditor groups
who elected to exit from the NAC business.
It also worked on negotiations and amendments to multiple other
facilities and structures, in line with the process negotiated in
the restructuring support agreement, which was signed in December
2021.
Duncan Batchelor, global head of aviation at Norton Rose Fulbright,
said: "As one of the largest US Chapter 11 bankruptcy proceedings
ever undertaken by an aircraft leasing company, this was a
fascinating case to work on. I am delighted that this restructuring
has come to a successful conclusion and that there is now a strong
foundation in place for future development and growth."
Norton Rose Fulbright's London and Paris offices provided the lead
advice on aviation finance and all related issues. Its New York,
Singapore, Luxembourg and Paris offices advised on local law
matters. Co-counsel Weil Gotschal & Manges advised on the
restructuring through its teams in London and New York, and Dillon
Eustace provided Irish law advice.
The firm's multi-award winning, global aviation practice holds 11
tier 1 rankings across the leading legal directories, Chambers and
Legal 500, based on the feedback of clients and peers.
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.
OLYMPIA SPORTS: Unsecured Creditors Will Get 22% of Claims in Plan
------------------------------------------------------------------
Olympia Sports, Inc., filed with the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania a Plan of Reorganization for Small
Business dated May 31, 2022.
Since 1980, the Debtor has been in the business of the retail sale
of athletic footwear.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $324,964.42. The final
Plan payment is expected to be paid on July 1, 2027.
This Plan of Reorganization proposes to pay creditors of the Debtor
from cash flow from operations, or future income.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 22 cents on the dollar. This Plan also provides
for the payment of administrative and priority claims.
Class 2 consists of the Secured Claim of Small Business
Administration with $150,000 claim to be paid pursuant to contract
with 3.75% interest and monthly payments of $731 per month.
Class 3 consists of Non-priority unsecured creditors. Unsecured
creditors to receive 22% of claims. The allowed unsecured claims
total $624,641.81.
Equity security holders shall retain interest.
A full-text copy of the Plan of Reorganization dated May 31, 2022,
is available at https://bit.ly/3NSfDG9 from PacerMonitor.com at no
charge.
Attorney for the Plan Proponent:
Robert Braverman, Esq.
McDowell Law, PC
46 West Main Street
Maple Shade, NJ 08052
Tel: (856) 482-5544
Fax: (856) 482-5511
Email: rbraverman@mcdowelllegal.com
About Olympia Sports
Olympia Sports, Inc., owns and operates a shoes and clothing retail
store. Olympia Sports sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Pa. Case No. 22-10535) on March
2, 2022. In the petition signed by Jae Ko, president, the Debtor
disclosed $426,214 in assets and $1,001,666 in liabilities.
Judge Ashely M. Chan oversees the case.
Robert N. Braverman, Esq., at McDowell Law, PC, is the Debtor's
counsel.
ORGANIC GREEN LAWN: Files Case Pro Se; UST Seeks Dismissal
----------------------------------------------------------
Organic Green Lawn LLC filed for chapter 11 protection in the
Northern District of Georgia. The Debtor elected to proceed under
Subchapter V of Chapter 11 of the Bankruptcy Code.
According to court documents, Organic Green Lawn estimates between
1 and 49 unsecured creditors. The petition states funds will not
be available to unsecured creditors.
The U.S. Trustee has immediately filed a motion to dismiss the
case.
The Debtor notes that the Petition was signed by "Greg Armstrong"
as a "member" of Debtor. No attorney signed the petition as
representative of the Debtor.
On the Petition, the Debtor indicates that it is a limited
liability company; as a result, it appears on the face of the
Petition that Debtor is an artificial entity and that it is not
represented by an attorney.
Because Debtor is an artificial entity, it cannot represent itself
in this proceeding, nor may its officers appear before this court
on its behalf unless they are licensed attorneys. Accordingly, the
U.S. Trustee asks the Court to dismiss the case, for cause,
pursuant to 11 U.S.C. Sec. 1112(b).
About Organic Green Lawn
Organic Green Lawn LLC is a lawn care service provider.
Organic Green Lawn sought protection under Chapter 11 under U.S.
Bankruptcy Code (Bankr. N.D. Ga. Case No. 22-53948) on May 25,
2022. In the petition signed by Greg Armstrong, as member, Organic
Green Lawn estimated assets between $100,000 and $500,000 and
liabilities between $500,000 and $1 million.
John Whaley has been appointed as Subchapter V trustee.
PARADISE REDEVELOPMENT: S&P Lowers ICR to 'CCC', Outlook Negative
-----------------------------------------------------------------
S&P Global Ratings lowered its long-term rating to 'CCC' from 'BB'
on Paradise Redevelopment Agency, Calif.'s series 2009 refunding
tax allocation bonds and removed it from CreditWatch with negative
implications, where it was placed on May 10, 2022. The outlook is
negative, reflecting that there is at least a one-in-three chance
that S&P will lower the rating by one or more notches within the
next year.
"The rating action reflects the agency's use of its debt service
reserve fund to pay its June 1, 2022 principal and interest debt
service payment due to insufficient pledged revenues generated from
the project area," said S&P Global Ratings credit analyst Li Yang.
"It also reflects an unwillingness on the part of management to use
any other resources, particularly settlement funds, to pay for debt
service on the series 2009 bonds. We view management's decision to
allocate settlement funds to other expenditures rather than debt
service payments as a risk management, culture, and oversight
governance risk that we capture under our environmental, social,
and governance factors, which is a key credit driver of the rating
action," he further said.
S&P's rating incorporates its view of elevated risk management
governance concerns that will likely continue to pressure the
rating during the next year, specifically management's
decision-making that is likely to lead to a draw on its debt
service reserve fund (DSRF). While the town has sufficient funds to
pay the upcoming debt service payment, it has decided to use
remaining resources for other purposes instead of ensuring debt
service is made in full and on time.
PLAYER'S POKER: Exclusivity Period Extended to Aug. 4
-----------------------------------------------------
Player's Poker Club, Inc. obtained an order from the U.S.
Bankruptcy Court for the Central District of California extending
its exclusivity periods to file a Chapter 11 plan and solicit
acceptances for the plan to Aug. 4 and Nov. 4, respectively.
The extension will give Player's Poker Club more time to determine
the proper treatment of its former landlord's potential claim,
which could exceed $1.2 million, according to its attorney, Michael
Kogan, Esq., at Kogan Law Firm, APC.
"In order to formulate and file a feasible plan of reorganization,
it is imperative that pending disputes concerning [Player's Poker
Club's] former lease be resolved," Mr. Kogan said in court papers.
Player's Poker Club does not anticipate having the lease issues
resolved until the earliest of July.
About Player's Poker Club
Ventura, Calif.-based Player's Poker Club, Inc. filed a petition
for Chapter 11 protection (Bankr. C.D. Calif. Case No. 21-10357) on
April 6, 2021, listing $3,061,422 in assets and $3,500,852 in
liabilities. Patrick Berry, general manager, signed the petition.
Judge Martin R. Barash oversees the case.
The Debtor tapped Kogan Law Firm, APC as bankruptcy counsel; Falk &
Sharp, APC as special counsel; and Kallman + Logan & Company, LLP
and RubinBrown, LLP as accountants.
QHC FACILITIES: Exclusivity Period Extended to June 27
------------------------------------------------------
Judge Anita Shodeen of the U.S. Bankruptcy Court for the Southern
District of Iowa extended to June 27 the period during which only
QHC Facilities, LLC and its affiliates can file a Chapter 11 plan
of reorganization.
The extension will give the companies more time to prepare their
plan and disclosure statement and to finalize the sale closing of
their facilities.
Much of the companies' attention and that of their counsel during
the first four months of their bankruptcy cases were devoted to the
sale of the facilities. At this time, the companies are in the
process of transferring the facilities through an orderly sale
process, according to their attorney, Krystal Mikkilineni, Esq., at
Bradshaw Fowler Proctor & Fairgrave, PC.
About QHC Facilities
Clive, Iowa-based QHC Facilities, LLC, operates eight skilled
nursing facilities. The facilities include Crestview Acres in
Marion as well as in Tama, Madison, Humboldt, Jackson, Webster and
Polk counties and two assisted living centers. Collectively, the
facilities have a maximum capacity of more than 700 residents. The
company employs roughly 300 full-time and part-time workers.
QHC Facilities and its affiliates filed petitions for Chapter 11
protection (Bankr. S.D. Iowa Lead Case No. 21-01643) on Dec. 29,
2021. The affiliates are QHC Management LLC, QHC Mitchellville LLC,
QHC Crestridge LLC, QHC Humboldt North LLC, QHC Winterset North
LLC, QHC Madison Square LLC, QHC Humboldt South LLC, QHC Villa
Cottages LLC, QHC Fort Dodge Villa LLC, and QHC Crestview Acres
Inc.
QHC Facilities reported $1 million in assets and $26.3 million in
liabilities as of the bankruptcy filing.
Judge Anita L. Shodeen oversees the cases.
The Debtors tapped Bradshaw Fowler Proctor & Fairgrave, PC and
Dentons Davis Brown, P.C. as bankruptcy counsels; Newmark Real
Estate of Dallas, LLC as investment banker; and Gibbins Advisors,
LLC as restructuring advisor.
The U.S. Trustee for Region 12 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on Jan. 24,
2022. Troutman Pepper Hamilton Sanders, LLP and Cutler Law Firm,
P.C. serve as the committee's lead bankruptcy counsel and local
counsel, respectively.
QUANTUM CORP: Neuberger Berman Entities Report 18.46% Equity Stake
------------------------------------------------------------------
In a Schedule 13G/A filed with the Securities and Exchange
Commission, these entities and individuals reported beneficial
ownership of shares of common stock of Quantum Corporation as of
April 30, 2022:
Shares Percent
Beneficially of
Reporting Person Owned Class
---------------- ------------ --------
Neuberger Berman Group LLC 16,687,039 18.46%
Neuberger Berman Investment Advisers LLC 16,687,039 18.46%
Neuberger Berman Equity Funds 7,453,714 8.25%
Neuberger Berman Intrinsic Value Fund 7,453,714 8.25%
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/709283/000156761922011364/doc1.htm
About Quantum Corp.
Based in San Jose, California, Quantum Corp. (NYSE:QTM) --
http://www.quantum.com-- provides technology and services that
stores and manages video and video-like data delivering streaming
for video and rich media applications, along with low cost, high
density massive-scale data protection and archive systems. The
Company helps customers capture, create and share digital data and
preserve and protect it for decades.
For the nine months ended Dec. 31, 2021, the Company reported a net
loss of $24.47 million. Quantum reported a net loss of $35.46
million for the year ended March 31, 2021, compared to a net loss
of $5.21 million for the year ended March 31, 2020. As of Dec. 31,
2021, the Company had $187.64 million in total assets, $310.42
million in total liabilities, and a total stockholders' deficit of
$122.78 million.
REHOBOTH PIPELINE: Exclusivity Period Extended to July 1
--------------------------------------------------------
Rehoboth Pipeline Construction Services, LLC obtained an order from
the U.S. Bankruptcy Court for the Western District of Pennsylvania
extending its exclusivity periods to file a Chapter 11 plan and
solicit acceptances for the plan to July 1 and Aug. 30,
respectively.
Rehoboth is still in the process of bidding new work, which will be
a source of funding for the plan, and needs additional time to gain
more specifics on how its future work will impact the plan,
according to its attorney, Aurelius Robleto, Esq., at Robleto
Kuruce, PLLC.
"Once the [company] has made more progress towards both negotiating
with certain of its largest creditors and has substantially more
information on the future work that will serve to fund the plan, it
will be able to file a detailed plan, which sets forth a specific
and certain path forward," Mr. Robleto said in court papers.
About Rehoboth Pipeline
Rehoboth Pipeline Construction Services, LLC is a Washington,
Pa.-based company that offers gas and oil construction services.
Rehoboth filed a petition for Chapter 11 protection (Bankr. W.D.
Pa. Case No. 21-22573) on Dec. 2, 2021, listing up to $50,000 in
assets and up to $10 million in liabilities. Christopher P. Walker,
managing member, signed the petition.
The Debtor tapped Renee Kuruce, Esq., at Robleto Kuruce, PLLC as
bankruptcy counsel and Springer & Steinberg, P.C. as special
counsel.
RUBY PIPELINE: Bondholders Frustrated by Slow Sale Process
----------------------------------------------------------
Ruby Pipeline LLC's bondholders, frustrated by the slow sale
process for the natural gas pipeline, are seeking to take more
control over the company's bankruptcy.
Ruby's owners -- Pembina Pipeline Corp. and Kinder Morgan Inc. --
have failed to make adequate progress toward selling the pipeline
and the company refuses to meaningfully engage with creditors on a
path forward, a group of bondholders said in a court papers filed
late last week. The investors want to file their own restructuring
plan, one that would hand them ownership of the pipeline, in the
event that the sale process fails to yield a buyer.
"Given the current status of negotiations and the complete lack of
progress
on the part of the Debtor, it is clear the Debtor's restructuring
has stalled for far too long. There is no reasonable basis to
exclude the Ad Hoc Group of Noteholders from filing a plan with the
overwhelming support of the only impaired third-party class in this
case and moving forward with it in parallel with the Debtor’s
marketing process. Failing to terminate exclusivity and continuing
to wait for the Debtor to run a still uninitiated sale process is
sure to result in but one, entirely avoidable, outcome: a waste of
dollars, time and opportunity," the Noteholders said in court
filings.
The Ad Hoc Group of Noteholders has joined in on a request by the
Official Committee of Unsecured Creditors to terminate the Debtors'
exclusivity or, in the alternative, to appoint a Chapter 11
trustee.
According to the Committee, the Debtor filed its Chapter 11
petition nearly two months ago and almost nothing substantive has
been done even though the case is not complicated.
The Committee notes that there are only three assets in the
estate:
* First, there is the Debtor's pipeline that transports natural
gas (bought from others) from Wyoming to Oregon (where it is sold
to others). It is, essentially, a large tube; it is not an organic
business enterprise; it is a "thing."
* Second, there is a large cash stockpile: $122 million as of
the end of April, entirely unencumbered.
* Third, there are causes of action. The Debtor's equity
sponsors, Kinder Morgan, Inc. and Pembina Pipeline Corporation
transferred vast sums from the Debtor to themselves ($450+ million
over the last four years), as the company was in financial distress
and fading fast, giving rise to prima facie claims sounding in
fraudulent transfer, unlawful dividend, breaches of fiduciary duty,
and other theories.
The Committee notes that besides a remarkably simple asset-base,
the Debtor's capital structure is even more streamlined. There is
really only one important line-item on the debt-side of the balance
sheet: the Debtor's outstanding $475 million in principal amount of
unsecured Notes. All other debt is de minimis (e.g., a slight
amount of trade) or insider-debt owned by the Equity Sponsors that
is contractually subordinated (with "turn-over" obligations) to the
Noteholders.
"Terminating exclusivity will move the Chapter 11 case forward. The
Ad Hoc
Group of Noteholders submitted a Chapter 11 plan term sheet to the
Special Committee prior to the Petition Date that provided for a
transition of ownership to the Noteholders if they were not paid in
full in cash by the Equity Sponsors, and had earlier made a similar
offer to the Equity
Sponsors. That plan term sheet received no response. Following
the Petition Date, the Ad Hoc Group of Noteholders sent a revised
plan term sheet that would have enabled the Debtor to run a
marketing process for the pipeline in parallel with plan
confirmation. Again, no response. Following repeated overtures,
the Special Committee finally did engage, but only to propose a
"case protocol" (which appeared designed to materially delay
resolution of the case), not a substantive response to the plan
term sheet," the Committee said in court filings.
"The Ad Hoc Group of Noteholders' plan is actionable and
confirmable and should be permitted to advance expeditiously. The
plan is both ready to be filed quickly and provides the Debtor with
everything that they say they need: (i) an opportunity to run a
marketing process; (ii) room to investigate the value of the
estate's fraudulent transfer claims; and (iii) the ability to
quickly pivot away from an equitization at any time before the
disclosure statement hearing and to instead repay the Notes in cash
in full if the marketing process shows that this is possible. Dual
tracking the plan and marketing processes shortens the duration of
the Chapter 11 case, therefore benefiting all parties to this case
and prejudicing no one. In contrast, the Debtor does not have a
path to confirming a Chapter 11 plan absent agreement with the
Noteholders -- the only potentially impaired, non-insider creditor
class."
About Ruby Pipeline
Ruby Pipeline, LLC, a Houston-based natural gas pipeline company,
sought Chapter 11 bankruptcy protection (Bankr. D. Del. Case No.
22-10278) on March 31, 2022. In the petition filed by Will W.
Brown, as commercial vice-president, Ruby Pipeline listed $500
million to $1 billion in both assets and liabilities.
Judge Craig T. Goldblatt oversees the case.
Richards, Layton & Finger, P.A., is the Debtor's bankruptcy counsel
while PJT Partners, LP is the investment banker. Kroll
Restructuring Administration, LLC, formerly known as Prime Clerk,
LLC, is the claims and noticing agent and administrative advisor.
Counsel to the Ad Hoc Group and Special Counsel to the Indenture
Trustee are Morris, Nichols, Arsht & Tunnell LLP, and Davis Polk &
Wardwell LLP.
SHYREX INVESTMENTS: Property Sale Proceeds to Fund Plan Payments
----------------------------------------------------------------
Shyrex Investments, LLC, filed with the U.S. Bankruptcy Court for
the Northern District of Georgia a Disclosure Statement with regard
to Chapter 11 Plan dated May 31, 2022.
Shyrex Investments, LLC is a single asset real estate company that
owns real property located at 1598 Olympian Circle, SW, Atlanta,
Fulton County, Georgia 30310 (the "Property"). Debtor filed the
Chapter 11 case to prevent a foreclosure of the Property and to
ensure all interest holders in the Property were properly
compensated.
No financials are attached to this Disclosure Statement, as the
Plan is a liquidating plan in which the Property will be sold and
the proceeds of that sale used to pay all allowed claims in full.
Debtor is proposing to sell the Property for $565,000.00, and the
total secured claims are estimated to be $367,196.50.
Debtor estimates the total priority claims to be $7,018.10. Total
administrative claims are estimated to be $10,000.00. Debtor will
receive any sales proceeds not paid to claimants through the Plan.
There will be sufficient funds to cover all allowed claims and
expenses of the sale.
Class 1 consists of the Secured Claims. On the Initial Distribution
Date or as soon as practicable after the Claim becomes an Allowed
Claim (and no later than the 30th day of the first month after the
Claim becomes Allowed), each Holder of an Allowed Class 1 Claim
shall receive Cash in the full amount of such Claim, with interest
from the Petition Date at the Contract Rate, except to the extent
that the Holder of the Allowed Claim in Class 1 agrees to payment
on deferred or other such terms. Class 1 is an unimpaired class.
Class 2 consists of the claims of holders of any general unsecured
claim. On the Initial Distribution Date or as soon as practicable
after the Claim becomes an Allowed Claim (and no later than the
30th day of the first month after the Claim becomes Allowed), each
Holder of an Allowed Class 2 Claim shall receive Cash in the full
amount of such Claim, with interest from the Petition Date at the
Contract Rate, except to the extent that the Holder of the Allowed
Claim in Class 2 agrees to payment on deferred or other such terms.
Class 2 is an unimpaired class.
Class 3 consists of the equity interests of the Debtor. The equity
interests holders of the Debtor will be entitled to all proceeds
from the sale of the Property after payment of Class 1 and Class 2
Claimants.
Funds necessary to pay Debtor's Plan payments will be provided from
the sales proceeds of the Property. A motion to sell the Property
is pending before the Court at the time of filing of this
Disclosure Statement.
A full-text copy of the Disclosure Statement dated May 31, 2022, is
available at https://bit.ly/3xcXc9r from PacerMonitor.com at no
charge.
Attorney for the Debtor:
Will B. Geer, Esq.
Geer Law Group, LLC
50 Hurt Plaza, SE, Suite 1150
Atlanta, GA 30303
Telephone: (678) 587-8740
Facsimile: (404) 287-2767
Email: wgeer@geerlawgroup.com
About Shyrex Investments
Shyrex Investments, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Ga. Case No. 22-51647) on Feb.
28, 2022, listing as much as $1 million in both assets and
liabilities. Will B. Geer, Esq., at Geer Law Group, LLC, serves as
the Debtor's legal counsel.
SILVER LAKES RESORT: Unsecured Creditors Will Get 100% in Plan
--------------------------------------------------------------
Silver Lakes Resort Lodge Interval Owner's Association filed with
the U.S. Bankruptcy Court for the Central District of California a
Disclosure Statement describing Chapter 11 Plan dated May 31,
2022.
For many years, more and more timeshare owners defaulted in paying
their assessments, causing the Debtor to fall behind in secured
property taxes and assessments owed to the master association. The
Debtor's settlement agreement with the master association required
the Debtor to sell the inn in a chapter 11 bankruptcy proceeding.
The Plan proposes to restructure the financial affairs of the
above-named Debtor.
The Inn at Silver Lakes was sold in a Section 363 sale, and all
secured claims were paid out of escrow.
Classes 1 and 2 Secured Claims (divided into subclasses 1A, 1B, 2A,
2B, etc.) consist of claims secured by Collateral (such as a
mortgage/deed of trust secured by a house, a car loan secured by
the car, or any other claim secured by a lien on property of the
bankruptcy estate), which generally are entitled to be paid in
full, over time, with interest. Class 1 is reserved for claims
secured only by real estate that is an individual Debtor's
principal residence. Class 2 contains all other secured claims.
Class 4 consists of general unsecured claims (claims that are not
entitled to priority under the Bankruptcy Code and that are not
secured by Collateral), which will receive, over time, 100% of
their claims. The allowed unsecured claims total $476,102.59.
Class 5 consists of Interest Holders. This class will remain
unchanged unless otherwise stated in the exhibits to the Plan or
this Disclosure Statement.
The Plan proponent believes it is feasible because, both on the
Effective Date and for the duration of the Plan, the proponent
estimates that Debtor will have sufficient cash to make all
distributions.
A full-text copy of the Disclosure Statement dated May 31, 2022, is
available at https://bit.ly/3zgNLHM from PacerMonitor.com at no
charge.
Attorney for Silver Lakes:
Teresa A. Blasberg (#105473)
BLASBERG & ASSOCIATES
920 Fordham Drive
Davis, CA 95616
Phone: (213) 239-0364
tablasberg@earthlink.net
About Silver Lakes Resort Lodge
Interval Owner's
Association
Silver Lakes Resort Lodge Interval Owners Association --
https://www.innatsilverlakes.com/ -- is an association of owners of
The Inn at Silver Lakes, a resort in Southern California that is
affiliated with RCI and Interval International.
Silver Lakes Resort Lodge Interval Owners Association sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D.
Cal. Case No. 19-16352) on July 20, 2019, listing as much as $10
million in both assets and liabilities. Judge Mark S. Wallace
oversees the case.
Teresa A. Blasberg, Esq., at Blasberg & Associates and Porter &
Lasiewicz CPAs are the Debtor's legal counsel and accountant,
respectively.
SKY INN OPERATION: Unsecureds to be Paid in Full in 60 Months
-------------------------------------------------------------
Sky Inn Operation, Inc., d/b/a Staybridge Suites Austin Airport and
Austin Airport Suites, LLC, filed with the U.S. Bankruptcy Court
for the Western District of Texas a Disclosure Statement in support
of the Joint Chapter 11 Plan of Reorganization dated May 31, 2022.
Austin Airport Suites, LLC, d/b/a Staybridge Suites Austin Airports
("AAS"), is a Texas limited liability company. Debtor AAS operates
and leases the Staybridge Hotel (the "Hotel") located on property
locally described as 1611 Airport Commerce Dr., Austin, Texas 78741
(the "Real Property"). Debtor Sky Inn Operation, Inc. ("SIO"), a
Texas corporation, owns the Real Property and improvements
comprising the Hotel.
This Bankruptcy Case was necessitated by a decline in operational
revenue during the 2020 and 2021 peaks of the COVID-19 pandemic.
With substantial declines during the global pandemic, the Debtors
were unable to timely pay their secured obligations to RSS
COMM2015-DC1-TX SIO, LLC and its predecessors in interest. The
Hotel was posted for a non-judicial foreclosure set to occur on
March 1, 2022.
The Plan contemplates payment in full to all classes of creditors.
The Plan will be funded from operations of the Debtors and cash on
hand. With respect to specific classes of creditors, the Plan
provides:
* all Allowed Administrative Claims shall be paid in full, in
Cash, on the Effective Date, or as otherwise agreed in writing
between the Debtors and any such administrative claimant agreeing
to a different treatment;
* full payment of all Allowed Priority Claims of Governmental
Entities, if any, in Cash, through regular Monthly Plan Payments,
or as otherwise agreed in writing, together with interest over a
period through the fifth anniversary of the Petition Date;
* full payment, in Cash, of all Allowed Non-Governmental
Priority Claims, if any, on the Effective Date;
* full payment of all Allowed Secured Claims of Governmental
Entities, if any, in Cash, through regular Monthly Plan Payments,
or as otherwise agreed in writing, together with interest over a
period through the fifth anniversary of the Petition Date;
* full payment of the Allowed Secured Claim of RSS COMM2015
DC1-TX SIO, LLC, together with interest at the Plan Interest Rate,
through 120 regular monthly installment payments commencing on the
Effective Date and continuing monthly thereafter;
* full payment of the Other Allowed Secured Claims, if any,
together with interest at the Plan Interest Rate, through 60
regular monthly installment payments commencing on the Effective
Date and continuing monthly thereafter;
* full payment of the Allowed General Unsecured Claims through
60 regular monthly installment payments commencing on the Effective
Date and continuing monthly thereafter;
* full payment of the Allowed Convenience Class Claims through
6 regular monthly installment payments commencing on the Effective
Date and continuing monthly thereafter;
* All Pre-Petition Membership Interests in each of the Debtors
shall be preserved provided, however, that holders of such
interests shall receive no payments, dividends, or distributions,
on account of the Pre-Petition Membership Interests unless and
until claims in Classes 6 and 7 are paid in full.
A full-text copy of the Disclosure Statement dated May 31, 2022, is
available at https://bit.ly/3xc1pdK from PacerMonitor.com at no
charge.
Attorneys for the Debtors:
Kell C. Mercer, Esq.
Kell C. Mercer, P.C.
901 S. MoPac Expressway, Building 1, Suite 300
Austin, TX 78746
Tel: (512) 627-3512
Email: kell.mercer@mercer-law-pc.com
- and -
C.Daniel Roberts
C. Daniel Roberts & Associates, P.C.
1602 East Cesar Chavez
Austin, TX 78702
Tel: (512) 494-8448
Fax: (512) 494-8712
Email: droberts@cdrlaw.net
About Sky Inn Operation and Austin Airport
Sky Inn Operation, Inc. owns real property locally known as the
Staybridge Hotel located at 1611 Airport Commerce Drive, Austin,
Texas. AAS is renting the hotel pursuant to a lease agreement dated
June 23, 2008.
Sky Inn Operation and its affiliate, Austin Airport Suites, LLC,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
W.D. Texas Lead Case No. 22-10134) on Feb. 28, 2022.
In their petitions, Sky Inn Operation disclosed up to $50 million
in assets and up to $10 million in liabilities while Austin Airport
disclosed up to $500,000 in assets and up to $10 million in
liabilities. Armando Batarse Cardenas, president of Sky Inn Hotels
& Suites and sole shareholder, signed the petitions.
Judge Tony M. Davis oversees the cases.
C. Daniel Roberts, PC and Kell C. Mercer PC serve as the Debtors'
legal counsel.
SLM FFELP: S&P Affirms B (sf) Ratings on Eight Classes of Notes
---------------------------------------------------------------
S&P Global Ratings affirmed its 'B (sf)' ratings on eight classes
from SLM Student Loan Trust's series 2007-2, 2008-6, 2008-7, and
2010-1 transactions.
Each series is a student loan ABS transaction backed by a pool of
student loans originated through the U.S. Department of Education's
(ED) Federal Family Education Loan Program (FFELP).
S&P said, "Our review considered the transactions' collateral
performance and liquidity position, overall stable credit
enhancement, and capital and payment structures. We also considered
secondary credit factors, such as credit stability, peer
comparisons, and issuer-specific analyses."
Rationale
S&P said, "We believe the collateral amortization's current pace is
not adequate to repay the senior notes by their respective legal
final maturity date, which could trigger an event of default under
the transactions' documents. The collateral pool factors range from
10.43% to 18.98% as of the transactions' most recent servicer
reports. The transactions have features that allow the servicer to
purchase either an additional 2% or 10% of the collateral pool (the
additional collateral purchase), which can be used to provide
liquidity and lower the pool factor to below 10%. When the pool
factor is below 10%, the collateral can be sold to the servicer or
through an auction (the clean-up call). The proceeds of the
clean-up call can then be used to repay the notes in full.
"The affirmations reflect our expectation that the optional
clean-up call will be executed after the pool factors fall below
10% through either collateral amortization or the use of the
optional additional collateral purchase."
Capital Structure
Each transaction consists of one senior note and one subordinate
note, with coupons based on a spread above a LIBOR index.
Payment Structure And Credit Enhancement
The transactions utilize a payment mechanism that defines a
principal distribution amount to be distributed to the noteholders.
Generally, once the principal distribution amount is paid,
available funds can be used to pay subordinated amounts and
replenish the reserve account (if necessary and required), before
they are released out of the trust. The principal payment amount is
allocated sequentially between the class A and B notes. Credit
enhancement includes overcollateralization (parity), subordination
(for certain classes), a reserve account, and excess spread.
Parity is in excess of 100% for all classes. The reserve account,
which is measured as greater of 0.25% of the pool balance and a
nonamortizing fixed amount, grows as the notes amortize and may be
used to make payment on a note's legal final maturity date.
Collateral
The transactions primarily comprise seasoned Stafford loans that
are supported by an ED guarantee of at least 97% of a defaulted
loan's principal and interest. Loans that have been serviced
according to the FFELP guidelines are supported by this guarantee
and, therefore, net losses are expected to be minimal.
Liquidity
S&P said, "Our ratings address the receipt of timely interest
payments and principal payments by the legal final maturity dates.
Over the past two years, the note principal pay down continued to
decline. We calculated a principal payment haircut using the
average note principal payment over the past 12 months, which
indicates the percentage decline a note can immediately withstand
and still be repaid by its legal final maturity date." A lower
haircut indicates that a note can withstand a smaller decline in
its principal payment amount than a higher haircut. A negative
haircut implies that a note will need to experience a sustained
increase in principal payments. This increase could occur due to
higher loan prepayments or defaults (which act as a prepayment due
to the government guarantee), or from a decrease in loans in
income-based repayment plans or other nonpaying statuses, such as
in-school or in-grace, deferment, and forbearance.
As of the transactions' most recent servicer reports, the principal
payment haircut calculations for the senior classes were negative.
The calculated haircuts for the subordinate classes are stronger
than those for the senior classes because the subordinated classes
have later maturity dates that allow the borrower to make more loan
payments before the each class' legal final maturity date.
S&P will continue to monitor the transactions' performance,
including the student loan receivables, the available credit
enhancement, and liquidity, and take ratings actions as we deem
appropriate.
Ratings Affirmed
SLM Student Loan Trust
Series 2007-2, class A-4: B (sf)
Series 2007-2, class B: B (sf)
Series 2008-6, class A-4: B (sf)
Series 2008-6, class B: B (sf)
Series 2008-7, class A-4: B (sf)
Series 2008-7, class B: B (sf)
Series 2010-1, class A: B (sf)
Series 2010-1, class B: B (sf)
SLM STUDENT 2008-4: S&P Lowers Class B Notes Rating to CC (sf)
--------------------------------------------------------------
S&P Global Ratings lowered its rating on SLM Student Loan Trust
2008-4's class A-4 and B notes to 'CC (sf)' from 'B (sf)'. At the
same time, S&P placed its rating on the class A-4 notes on
CreditWatch with negative implications and its rating on the class
B notes on CreditWatch with developing implications.
This is a student loan ABS transaction backed by the U.S.
Department of Education's (ED) Federal Family Education Loan
Program (FFELP) loans.
The CreditWatch negative placement indicates a 50% or higher
likelihood that the rating on the class A-4 notes will be lowered,
while CreditWatch developing placement indicates that the rating on
the class B notes may be raised, lowered, or affirmed. CreditWatch
developing is used for situations where potential future events are
unpredictable and differ so significantly that the rating could be
raised, lowered, or affirmed.
S&P said, "Our review considered the transaction's collateral
performance and liquidity position, overall stable credit
enhancement, and capital and payment structures. We also considered
secondary credit factors, such as credit stability, peer
comparisons, and issuer-specific analyses."
Rationale
The rating actions primarily reflect the liquidity pressure the
senior (A-4) class is experiencing and not the credit enhancement
levels available to the classes for ultimate principal repayment.
The pace of note principal payment has slowed, and class A-4 is at
risk of not being repaid by its legal final maturity date. The
class A-4 note balance as of the April 2022 distribution date is
$117.5 million, and principal payments on the notes totaled $3.47
million in first-quarter 2022. S&P does not believe the collateral
will generate enough cash to pay the remaining class A-4 note
balance on its July 2022 legal final maturity date. The rating on
the class A-4 notes reflects the virtual certainty that this class
will likely be repaid after its July 25, 2022, maturity date,
triggering an event of default under the transaction documents.
After an event of default, the trustee or noteholders can take
several courses of action, which may affect the amount and timing
of payments the class B notes will ultimately receive. For example,
the parties may allocate payments according to the pre-event of
default waterfall, vote to accelerate the notes and allocate
payments according to the post-event of default waterfall, or
decide to sell the trust estate. Senior expenses could also
increase because uncapped expenses could be allowed under the
transaction documents if they relate to the post-event of default
course of action.
S&P said, "The rating actions reflect the application of our
criteria for assigning 'CCC' and 'CC' ratings, which state that we
rate an issue 'CC' when we expect default to be a virtual
certainty, regardless of the time to default. Accordingly, the 'CC
(sf)' ratings on the notes reflect our view that, even under
optimistic collateral performance scenarios, we believe class A-4
will default on principal repayment at its legal final maturity and
an event of default will occur, which will impact class B."
CreditWatch
S&P will determine whether to raise, lower, or affirm our rating on
the class B notes, based on the trustee's and/or the noteholders'
actions after the event of default.
Ratings Lowered And Placed On CreditWatch
SLM Student Loan Trust 2008-4
Class A-4 to CC (sf)/Watch Neg from 'B (sf)'
Class B to CC (sf)/Watch Dev from 'B (sf)'
SOUTH TEXAS ELV: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: South Texas ELV, LLC
d/b/a Asset Recovery Management Services
388 EO Woods Rd
Zavalla, TX 75980
Case No.: 22-60027
Business Description: The Debtor is a merchant wholesaler of
machinery, equipment, and supplies.
Chapter 11 Petition Date: June 3, 2022
Court: United States Bankruptcy Court
Southern District of Texas
Judge: Hon. Christopher M. Lopez
Debtor's Counsel: Richard Lee Fuqua II, Esq.
FUQUA & ASSOCIATES, P.C.
8558 Katy Freeway
Suite 119
Houston, TX 77024
Tel: (713) 960-0277
Fax: (713) 960-1064
Email: RLFuqua@FuquaLegal.com
Total Assets: $4,010,071
Total Liabilities: $254,358
The petition was signed by Stephanie Southwell as manager.
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/VBWNSIQ/South_Texas_ELV_LLC__txsbke-22-60027__0003.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/6I7R6MA/South_Texas_ELV_LLC__txsbke-22-60027__0001.0.pdf?mcid=tGE4TAMA
STRATEGIC IQ LLC: Unsecureds to Get Share of Income for 60 Months
-----------------------------------------------------------------
Strategic iQ, LLC, filed with the U.S. Bankruptcy Court for the
Eastern District of Michigan a Subchapter V Plan of Reorganization
dated May 31, 2022.
Debtor is a Michigan limited liability company that performs
management contracting services. Debtor regularly employs five full
employees and various contractors to assist in performing its
services.
Debtor filed its chapter 11 bankruptcy for several reasons,
including, inter alia, to attempt to resolve state court litigation
that was causing financial pressure on Debtor's operations, which
would have impacted Debtor's ability to continue to operate and
service its customers.
General unsecured Claims are not secured by property of the estate.
These claims shall comprise Class GUC under this Plan. Debtor shall
commit its projected disposable income to be paid quarterly on a
pro-rata basis to Class 4 General Unsecured Creditors over 60
months. Such payments will be made by the Debtor directly, and may
be prepaid.
Donyati has not yet filed a proof of claim, however, once it does
so long as it is timely, Debtor shall commence pro-rata plan
payments to it subject to the claims allowance procedures. If
Debtor or any party in interest objects to Donyati's claim, no
payments shall be made on the claim until entry of a final non
appealable Order allowing its claim. The allowed unsecured claims
total $669,100.89.
David Pavlov and Ken Dowd are the sole equity security holders of
the Debtor, and their continued personal services provided to the
Debtor are essential to its successful operation, both during this
case and following confirmation. Notwithstanding anything else in
this Plan, they shall retain their equity interests in the
reorganized Debtor in the same manner, nature, and extent as prior
to the Petition Date.
On Confirmation of the Plan, all property of the Debtor, tangible
and intangible, including, without limitation, licenses, furniture,
fixtures and equipment, will revert, free and clear of all Claims
and Equitable Interests except as provided in the Plan, to the
Debtor. The Debtor expects to have sufficient cash on hand to make
the payments required on the Effective Date. All plan payments may
be prepaid without penalty.
The Debtor must commit all or such portion of the future earnings
or other future income of the Debtor as is necessary for the
execution of the Plan.
The Debtor's financial projections show that the Debtor anticipates
a 60-month plan with quarterly payments totaling $461,588. Of this
amount, approximately $6,000 will likely be paid to the Subchapter
V Trustee and Debtor's professionals, on account of their
respective administrative expense claims; and the remaining amount
of the $461,588 will be paid to general unsecured creditors, on a
pro-rata basis. The final Plan payment is expected to be paid on or
about 60 months after the Effective Date.
A full-text copy of the Subchapter V Plan dated May 31, 2022, is
available at https://bit.ly/3GMim1m from PacerMonitor.com at no
charge.
Attorney for Debtor:
Robert Bassel, Esq.
P.O. Box T
Clinton, MI 49236
Tel: (248) 835-7683
Email: bbassel@gmail.com
About Strategic iQ
Strategic iQ, LLC filed a petition under Chapter 11, Subchapter V
of the Bankruptcy Code (Bankr. E.D. Mich. Case No. 22-41595) on
March 2, 2022, listing up to $500,000 in both assets and
liabilities. Charles M. Mouranie serves as the Subchapter V
trustee.
Judge Thomas J. Tucker oversees the case.
The Debtor is represented by Robert N. Bassel, Esq., a practicing
attorney in Clinton, Mich.
SUNGARD AS: Committee Seeks to Hire Pachulski as Counsel
--------------------------------------------------------
The official committee of unsecured creditors of Sungard AS New
Holdings, LLC and its affiliated debtors seeks approval from the
U.S. Bankruptcy Court for the Southern District of Texas to hire
Pachulski Stang Ziehl & Jones, LLP as its counsel.
The firm's services include:
a. assisting, advising, and representing the committee in its
consultations with the Debtors regarding the administration of
these Cases;
b. assisting, advising, and representing the committee in
analyzing the Debtors' assets and liabilities, investigating the
extent and validity of liens and participating in and reviewing any
proposed asset sales, any asset dispositions, financing
arrangements, and cash collateral stipulations or proceedings;
c. assisting, advising, and representing the committee in any
manner relevant to reviewing and determining the Debtors' rights
and obligations under leases and other executory contracts;
d. assisting, advising, and representing the committee in
investigating the acts, conduct, assets, liabilities, and financial
condition of the Debtors, the Debtors' operations and the
desirability of the continuance of any portion of those operations,
and any other matters relevant to these cases or to the formulation
of a plan;
e. assisting, advising, and representing the committee in its
participation in the negotiation, formulation, and drafting of a
plan of liquidation or reorganization;
f. advising the committee on the issues concerning the
proposed sale of assets;
g. assisting, advising, and representing the committee in
understanding its powers and its duties under the Bankruptcy Code
and the Bankruptcy Rules and in performing other services as are in
the interests of those represented by the committee;
h. assisting, advising, and representing the committee in the
evaluation of claims and on any litigation matters, including
avoidance actions and claims against directors and officers and any
other party; and
i. providing such other services to the committee as may be
necessary or appropriate in these Cases.
The firm's current standard hourly rates are as follows:
Partners $945 - $1,775
Of Counsel $725 - $1,425
Associates $675 - $825
Paraprofessionals $460 - $495
Michael Warner, Esq., a partner at Pachulski, assured the court
that his firm is a disinterested person within the meaning of
Section 101(14) of the Bankruptcy Code.
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Mr.
Warner disclosed that:
-- Pachulski has not agreed to any variations from, or
alternatives to, its standard or customary billing arrangements for
this engagement;
-- No Pachulski professional included in the engagement has
varied his rate based on the geographic location of the bankruptcy
case;
-- Pachulski has not represented the committee in the 12
months prepetition; and
-- Pachulski anticipates that the committee's professional
fees will be initially governed by the debtor-in-possession
financing order and budget approved in these cases.
The firm can be reached through:
Michael D. Warner, Esq.
Pachulski Stang Ziehl & Jones, LLP
440 Louisiana Street, Suite 900
Houston, TX 77002
Tel: 713-691-9385
Fax: 713-691-9407
Email: mwarner@pszjlaw.com
About Sungard AS New Holdings
Sungard Availability Services is a Wayne, Pa.-based
information-technology services provider owned by Angelo Gordon,
Blackstone Credit, FS/KKR Advisor LLC and Carlyle Group Inc. It
provides disaster recovery services, colocation and network
services, cloud and managed services and workplace recovery to
customers in North America, Europe and Asia.
The company and its affiliates filed for Chapter 11 protection
twice in three years.
Sungard filed for Chapter 11 bankruptcy in 2019 with a prepackaged
plan that was approved by a New York bankruptcy court one day after
it was filed.
Sungard AS New Holdings, LLC and affiliates, including Sungard
Availability Services, LP, sought protection under Chapter 11 of
the Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-90018) on
April 11, 2022. Judge David R. Jones oversees the cases.
In the petition signed by Michael K. Robinson, chief executive
officer and president, Sungard AS disclosed up to $1 billion in
both assets and liabilities.
Sungard Availability Services (UK) Limited, an indirect subsidiary
of Holdings, entered into administration in the UK on March 25,
2022. Meanwhile, Sungard Canada filed an application for
recognition in Canada under the Companies Creditors' Arrangement
Act of its Chapter 11 case.
The Debtors tapped Akin Gump Strauss Hauer & Feld, LLP and Jackson
Walker as bankruptcy counsels; Cassels Brock & Blackwell, LLP as
Canadian legal counsel; DH Capital, LLC and Houlihan Lokey, Inc. as
investment bankers; and FTI Consulting, Inc. as financial and
restructuring advisor.
Alvarez & Marsal Canada Inc., serves as Canadian court-appointed
information officer and is represented by Bennett Jones, LLP as
counsel in connection with the Canadian proceedings.
Kroll Restructuring Administration, LLC serves as notice and claims
agent.
Proskauer Rose, LLP and Gray Reed & McGraw, LLP serve as counsel to
Acquiom Agency Services LLC, the Term Loan DIP agent, and Term Loan
DIP lenders.
PNC Bank, National Association, serves as administrative agent and
collateral agent, under the DIP ABL facility. PNC is represented
by Thompson Coburn Hahn & Hessen LLP as counsel.
On April 25, 2022, the U.S. Trustee for Region 7 appointed an
official committee of unsecured creditors in the Debtors' Chapter
11 cases. The committee is represented by Pachulski Stang Ziehl &
Jones, LLP.
TALEN ENERGY: Chamberlain, Meyer Unkovic Advise Energy Brokers
--------------------------------------------------------------
In the Chapter 11 cases of Dupont Street Developers LLC, the law
firms of Chamberlain, Hrdlicka, White, Williams & Aughtry, P.C. and
Meyer, Unkovic & Scott LLP submitted a verified statement under
Rule 2019 of the Federal Rules of Bankruptcy Procedure, to disclose
that they are representing the following parties:
a. Richards Energy Group, Inc.
c/o Peter Richards, President
781 S. Chiques Rd.
Manheim, PA 17545
b. URA, Inc., t/d/b/a Utility Rates Analysts
c/o Jesse Cantore
5010 E Trindle Rd., Suite 200
Mechanicsburg, PA 17050
c. Masonic Villages of the Grand Lodge
of Pennsylvania
c/o Patrick J. Sampsell, Esq.
General Counsel
1 Masonic Drive
Elizabethtown, PA 17022
d. Conestoga Wood Specialties Corporation
c/o Mike Vaughn
245 Reading Road
PO Box 158
East Earl, PA 17519
The Parties each hold disclosable economic interests against Talen
Energy Supply, LLC, et al. Richards and URA are energy brokers who
brokered with Talen to supply electricity to their customers at a
pre-determined price. Masonic Villages is in the business of
providing housing and services to senior citizens across the state
of Pennsylvania. Conestoga is in the business of manufacturing,
distributing, and supplying cabinetry, doors, and other wood
products across America. Masonic Villages and Conestoga have
engaged energy brokers, including Richards, for the procurement of
electricity.
The Parties are monitoring Debtors' cases, and are aware of and
have consented to the Group's representation of them collectively.
The Group holds no interest in Debtors or its estates. None of the
Parties’ disclosable economic interests have been assigned
subsequent to the commencement of Debtors' cases, and have not been
solicited for purchase by the Group.
Counsel for the Parties can be reached at:
CHAMBERLAIN, HRDLICKA, WHITE, WILLIAMS & AUGHTRY, P.C.
Jarrod B. Martin, Esq.
Tyler W. Greenwood, Esq.
1200 Smith Street, Suite 1400
Houston, TX 77002
Tel: 713-356-1280
Fax: 713-658-2553
E-mail: Jarrod.Martin@chamberlainlaw.com
E-mail: Tyler.Greenwood@chamberlainlaw.com
- and -
MEYER, UNKOVIC & SCOTT LLP
Robert E. Dauer, Jr., Esq.
535 Smithfield Street, Suite 1300
Pittsburgh, PA 15222
Tel: 412-456-2800
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/3aElErJ
About Talen Energy Supply, LLC
Talen Energy Supply, LLC, and its affiliates are energy and power
generation companies in North America, owning and/or controlling
approximately 13,000 megawatts of generating capacity in wholesale
U.S. power markets in the mid-Atlantic, Massachusetts, Texas, and
Montana. In addition to geographic diversity, the Company's
generation fleet reflects significant technological and fuel
diversity including nuclear, natural gas, oil, and coal, with
certain of the Company's facilities capable of utilizing multiple
fuel sources.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Tex. Case No. 22-90054) on May 9,
2022. In the petitions signed by Andrew M. Wright, general counsel
and secretary, the Debtors disclosed up to $50 billion in both
assets and liabilities on a consolidated basis.
Judge Marvin Isgur oversees the case.
The Debtors tapped Weil, Gotshal & Manges LLP as legal counsel,
Evercore Group, LLC as investment banker, Alvarez and Marsal North
America, LLC as financial advisor, and Kroll Restructuring
Administration, LLC as claims agent.
TENET HEALTHCARE: Fitch Rates New First Lien Notes 'BB-'
--------------------------------------------------------
Fitch Ratings has assigned a 'BB-'/'RR3' rating to the new senior
secured first lien notes offered by Tenet Healthcare. The Long-Term
Issuer Default Rating (IDR) for Tenet is 'B+' with a Stable
Outlook. The new notes will rank equally with Tenet's outstanding
senior secured first lien notes. Proceeds of the offering are
expected to fund the redemption of Tenet's outstanding 6.750%
senior unsecured notes due 2023.
The rating and outlook reflect Tenet's improving competitive
position as a healthcare provider and the durability of its
operational and financial results through the pandemic, with debt
leverage declining meaningfully in recent years albeit still at
high levels. Fitch expects gross leverage to remain below 5.5x
(based on Fitch-defined EBITDA) through the rating horizon, as is
appropriate for the rating, but notes risk to leverage levels
should Tenet's capital allocation decisions prove overly aggressive
through large, debt-funded acquisitions and its stated potential to
consider share repurchases beginning in 2023.
KEY RATING DRIVERS
Hospitals and ASCs Drive Operating Outlook: Tenet is one of the
largest for-profit operators of acute care hospitals and ambulatory
surgery centers (ASCs) in the U.S. In 2021, the hospital and
ambulatory care segments contributed 82% and 14% of revenue and,
notably, 55% and 34% of reported EBITDA, respectively. The ASC
business provides diversification in settings of care and payor
mix, and benefits from margins that were over 3x those in its
hospital segment in 2021. Fitch expects secular tailwinds to
continue to augment volume growth and acuity mix in the ASC
business over the rating horizon.
One of Tenet's stated goals is to increase the contribution of its
ASC business to 50% of reported EBITDA by YE 2023, with only 40%
from its hospital segment. Fitch expects Tenet to pursue this goal
by further refining its hospital operations via divestitures and
expanding its ASC business via acquisitions and de novo
development, with organic growth in the ASC business likely well
above that from its hospitals. Tenet's two major acquisitions of
ASC assets from SurgCenter Development (SCD) in December 2020 and
December 2021 (the latter including an option to partner with SCD
affiliates to develop at least 50 ASCs over five years), and its
purchases of nearly a dozen other ASCs and additional center-level
equity, mark a $2.5+ billion investment in the expansion of its
higher-margin, higher-growth ASC business.
Effects of Pandemic Remain Manageable: Fitch expects the negative
effects of the pandemic, including higher operating expenses and
lower volumes, to persist through 1H22 at the least. While volumes
have not fully recovered to pre-pandemic levels, they have
rebounded sharply from their lows in 2Q20 and stabilized at levels
where Tenet can support its current capitalization and ratings.
Lower volumes have been offset in part by accommodative payment
policies implemented by government payors, increases in acuity mix
and Tenet's reduction of operating costs. Relative to labor cost
pressures affecting acute care hospitals, inflation in Tenet's ASC
business has proven modest thus far, insulating its overall
results.
Margins Improving Amid Pandemic: Tenet has made significant
progress on its objectives to (i) improve operations, (ii)
rationalize its hospital footprint by exiting non-core assets and
(iii) expand its ASC business. With the contribution of its
high-margin ASC operations rising, pandemic patient volumes
subsiding to more tolerable levels, and Tenet capturing operating
efficiencies to manage COVID's labor cost challenges, Fitch-defined
operating EBITDA margin increased to nearly 15% in 2021. This marks
the highest level in five years, up from approximately 12% in
2016.
Margins should benefit if the pandemic recedes and as the
contribution of its ambulatory care segment increases via organic
growth and the continuing acquisitions and capital investment that
Fitch expects. However, inflationary pressures on labor, both in
terms of compensation increases and greater use of costly contract
labor, remain a notable headwind for all acute care hospital
operators. With the company's expanding ASC operations better
insulating Tenet's overall results from labor cost pressures to
date, Fitch expects recently-increased operating margins to be
sustainable and anticipates modest margin improvement over the
rating horizon.
Leverage Still High, But Moderating: Gross leverage as of YE 2021
was 5.5x (based on Fitch-defined EBITDA), notably improved from
levels well above 6.0x in recent years. With $700 million of senior
secured first lien notes retired using cash on hand in February
2022, Fitch expects Tenet to sustain leverage below 5.5x, with
potential for up to a turn of deleveraging, over the rating
horizon. The degree to which leverage improves further is likely to
reflect a still-dynamic operating environment amid the pandemic and
Tenet's capital allocation decisions, most notably its potential
pursuit of ASC acquisitions on a larger scale in 2022 and beyond
and its potential to consider share repurchases beginning in 2023.
DERIVATION SUMMARY
Tenet's 'B+' Long-Term IDR reflects its higher leverage relative to
that of its closest hospital industry peers HCA Healthcare Inc.
(HCA; BB+/Stable) and Universal Health Services Inc. (UHS;
BB+/Stable). While Tenet's operating and FCF margins also lag those
of HCA and UHS, Tenet has started to close the gap by reducing
costs, divesting lower-margin hospitals and expanding its
higher-margin ASC business.
Tenet has a stronger operating profile than lower-rated hospital
industry peers Prime Healthcare Services Inc. (B/Stable) and
Community Health Systems, Inc. (B-/Stable). In contrast to these
peers, but similar to higher-rated peers HCA and UHS, Tenet's
operations are primarily located in urban or large suburban
markets, which generally have more favorable organic growth
prospects.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case For The Issuer:
-- Revenue and operating EBITDA improve in 2022 and grow by 3%-6%
thereafter with some margin improvement as the EBITDA mix
shift towards the ASC business;
-- Operating cash flows negatively affected in 2022 as certain
benefits from the CARES Act are unwound (e.g. Medicare advance
repayments, deferred payroll taxes);
-- Capex approximating 4% of revenues annually and $500 million-
$750 million of acquisitions per year focused on expanding the
ASC business and offering higher-acuity hospital services;
-- No meaningful changes to gross debt beyond completed and
announced transactions;
-- Share repurchases of $200 million-$600 million annually
starting in 2023.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- An expectation of debt/EBITDA after associate and minority
dividends sustained below 4.5x; and
-- An expectation of FCF margins sustained above 5.0%.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- An expectation of debt/EBITDA after associate and minority
dividends sustained above 5.5x; and
-- An expectation of FCF margins sustained below 2.0%.
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
Solid Liquidity Profile: Tenet's sources of liquidity at YE 2021
included $2.4 billion of cash ($1.7 billion pro forma solely for
the Feb. 2022 redemption of $0.7 billion of the 7.500% senior
secured first lien notes due 2025, but not the March 2022
open-market repurchases of $103 million of its 6.750% senior
unsecured notes due 2023, which were disclosed with its 1Q22
results) and a recently-amended, undrawn $1.5 billion ABL facility
maturing in March 2027. While Tenet's cash balance should decline
near term after $1.0 billion of repayments of Medicare advance and
payroll tax deferral funds in 2022, Fitch expects annual FCF to
average nearly $1.0 billion over the rating horizon, all of which
Fitch assume will fund acquisitions and share repurchases, split
approximately 70% and 30%, respectively.
Pro forma for the refinancing of all outstanding 6.750% senior
unsecured notes due 2023 to be funded by the proposed bond
offering, Tenet's earliest debt maturity would be $1.4 billion of
senior secured first lien notes due in 3Q24. Fitch notes that Tenet
has sufficient debt covenant capacity to refinance these bonds
using senior secured first lien debt and expects Tenet is likely to
maintain access to such capital. Fitch also notes that Tenet's only
financial maintenance covenant is a 1.5x fixed-charge coverage
requirement applicable only in a liquidity event wherein available
ABL capacity falls below $150 million.
Debt Notching Considerations: The 'BB-'/'RR3' ratings for Tenet's
senior secured first lien notes reflect Fitch's expectation of a
recovery for this debt in the range of 51%-70% in a bankruptcy
scenario. While this is below the recovery Fitch expects for
Tenet's 'BB+'/'RR1'-rated ABL facility in the range of 91%-100%, it
is more favorable than the recovery Fitch expects for Tenet's
senior secured second lien notes and senior unsecured notes, both
rated 'B+'/'RR4', which Fitch expects to recover in the range of
31%-50%, in all cases within a bankruptcy scenario. This debt
notching and the recovery ranges below are calculated on a pro
forma basis for the proposed offering of senior secured first lien
notes refinancing senior unsecured debt, yet unchanged from those
based on the balance sheet as of YE 2021 pro forma for the $700
million redemption of all 7.500% senior secured first lien notes
due 2025 in February 2022.
Recovery Analysis: Fitch estimates an enterprise value (EV) on a
going-concern basis of $10.4 billion for Tenet after deducting 10%
for administrative claims assumed to accrue in restructuring. The
estimated EV reflects estimated post-reorganization EBITDA after
dividends to associates and minorities of $1.6 billion, up from
$1.4 billion previously, reflecting Fitch's view that EBITDA around
these levels is likely to trigger a default or restructuring amid
significant refinancing risk from negative FCF and high leverage.
The $1.6 billion EBITDA estimate is based on a scenario in which:
(i) hospital volumes turn negative, reflecting elevated pressure
from adverse secular shifts in the settings in which acute care is
provided, with declines in acuity mix and pricing further
pressuring revenue and compressing margins amid rising labor costs;
(ii) the ASC business expands at a much slower pace than that
assumed in Fitch's rating case; and (iii) the Conifer business sees
slower revenue growth, further pressuring consolidated margins.
The $10.4 billion EV further reflects Fitch's use of a 7.25x
EV/EBITDA multiple, up from 7.00x previously. This reflects (i) an
increasing share of the valuation attributable to an expanding ASC
business (especially as Fitch expects a default scenario to entail
material underperformance in the hospital business relative to the
ASC business) and (ii) mature ASCs garnering EV multiples well over
8.00x versus EV multiples for acute care hospitals in the 6.50x
area, reflecting the latter's lower margins and lower growth
prospects.
In estimating claims, Fitch assumes that Tenet would draw the full
amount available on the $1.5 billion ABL facility in a bankruptcy
scenario, and includes this amount and $0.2 billion of mortgages as
super-priority debt in the claims waterfall recovering first and in
full. The waterfall analysis also reflects (i) senior secured
claims consisting of $10.2 billion of senior secured first lien
notes and $1.5 billion of senior secured second lien notes, each
collateralized solely by the capital stock of Tenet's wholly-owned
guarantor subsidiaries that own or operate hospitals, and (ii) $2.9
billion of senior unsecured notes.
Fitch assumes the guarantor subsidiaries comprise 45% of the
distributable EV, down from 50% previously, reflecting (i) an
increasing share of the EV attributable to an expanding ASC
business garnering a higher share of Tenet's EBITDA and (ii)
Fitch's view that a default scenario is likely to entail material
underperformance in the hospital business relative to the ASC
business.
Fitch assumes the non-guarantor subsidiaries (the Conifer and ASC
businesses) comprise 55% of the remaining distributable EV, up from
50% previously, reflecting the foregoing and an increase from their
contribution of approximately 50% of EBITDA currently but below the
contribution of approximately 60% expected by YE 2023. Fitch
assumes the collateral attributable to the guarantor subsidiaries,
again valued at 45% of distributable EV, is recovered from first by
both the ABL and mortgage claims in full, and thereafter by the
senior secured first lien notes in part due to insufficient
remaining value, leaving the senior secured first lien notes with a
deficiency claim of $7.2 billion, and leaving the senior secured
second lien notes with no recovery from the collateral and a full
deficiency claim of $1.5 billion.
Fitch assumes these deficiency claims of $8.7 billion and the
senior unsecured note claims of $2.9 billion, together totaling
$11.6 billion in unsecured claims, receive a pro-rata recovery of
the remaining $5.7 billion of distributable EV attributable to the
non-guarantor subsidiaries, with unsecured claims thus recovering
in the 31%-50% range. The senior secured first lien notes, in
contrast, recover in the range of 51%-70%, as they further benefit
via partial recovery from the guarantor subsidiaries collateral.
Further hospital divestitures and/or continuing ASC investments
could narrow the notching between the senior secured first lien
notes and the senior unsecured notes and/or trigger rating
actions.
ISSUER PROFILE
Tenet is among the largest U.S. for-profit operators of acute care
hospitals and ASCs. Its operations include: 60 hospitals; 535 other
healthcare facilities, including 399 ASCs and 24 surgical
hospitals; and Conifer Health Solutions, which provides revenue
cycle management and value‑based care services.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch has removed the effects of certain portions of the CARES Act
from operating EBITDA and has reallocated changes in working
capital that are deemed non-recurring (i.e. grant monies) or
temporary (i.e. accelerated Medicare payments, deferred payroll
taxes) to non-operating lines.
ESG CONSIDERATIONS
Tenet has an ESG Relevance Score of '4' for Exposure to Social
Impacts due to societal and regulatory pressures to constrain
growth in healthcare spending in the U.S. 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.
DEBT RATING RECOVERY
---- ------ --------
Tenet Healthcare Corp.
senior secured LT BB- New Rating RR3
TENET HEALTHCARE: Moody's Rates $1.8BB First Lien Notes 'B1'
------------------------------------------------------------
Moody's Investors Service assigned a B1 rating to Tenet Healthcare
Corporation's offering of $1.8 billion of senior secured first lien
notes due 2030. All other ratings are unchanged including its B1
Corporate Family Rating, B1-PD Probability of Default Rating, B3
senior unsecured notes ratings and the SGL-1 Speculative Grade
Liquidity rating. The outlook remains stable.
Tenet intends to use the net proceeds from the sale of the notes,
after payment of fees and expenses, to finance, together with cash
on hand, the redemption of all $1.748 billion outstanding of its
6.750% senior notes due 2023. Moody's views the offering as credit
positive as it is leverage neutral and will lengthen Tenet's debt
maturity profile.
Assignments:
Issuer: Tenet Healthcare Corporation
Senior Secured 1st lien Notes at B1 (LGD3)
RATINGS RATIONALE
Tenet's B1 Corporate Family Rating reflects Moody's expectation
that the company will operate with moderately high financial
leverage over the next 12-18 months with adjusted debt/EBITDA
sustained in the low 5-times range. Debt/EBITDA as of March 31,
2022 was approximately 5 times. The B1 CFR rating also reflects
Moody's expectations that the company will generate free cash flow
in the $575-775 million range (after repayment of outstanding
Medicare advances and deferred payroll tax payments). The rating is
supported by Tenet's significant scale and good diversity. The
company is well diversified by state and payor though with some
concentration Moody's estimates around 60% of licensed beds are
located in Texas, Florida and California. Tenet's ambulatory
surgery and revenue cycle management businesses add business
diversity. The ambulatory surgery business in particular will
benefit from longer-term trends that favor services being done on
an outpatient basis, and has become a larger portion of the
company's revenues over the past few years.
The stable outlook reflects Moody's view that Tenet will continue
to operate with significant scale and diversity over the next 12-18
months while maintaining moderately high financial leverage. The
stable outlook also incorporates Moody's expectations that the
company is likely to utilize free cash flow to fund acquisitions,
at a pace consistent with past history.
ESG considerations are material to Tenet's credit profile. With
respect to governance, Tenet has generally exhibited aggressive
financial policies, marked by persistently high, though improving
financial leverage. As a for-profit hospital operator, Tenet also
faces high social risk. Beyond COVID-19, the affordability and
price transparency of hospitals and the practice of balance billing
have garnered substantial social and political attention.
Additionally, hospitals rely on Medicare and Medicaid for a
substantial portion of reimbursement. Any changes to reimbursement
to Medicare or Medicaid directly impacts hospital revenue and
profitability.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Tenet's ratings could be downgraded if the company's operating
performance weakens or if financial policies were to become more
aggressive though material debt-funded acquisitions or more
aggressive returns to shareholders. Quantitatively ratings could be
downgraded if debt/EBITDA was sustained above 5.75 times or if free
cash flow after non-controlling interest distributions were to
materially decline.
The ratings could be upgraded if Tenet can realize the additional
benefits from its recent cost and operating initiatives, including
increased profit margins. Further, the ratings could be upgraded if
Tenet sustains and improves its free cash flow generate and reduces
leverage. Quantitatively ratings could be upgraded if debt/EBITDA
was sustained below 5 times for an extended period.
Tenet, headquartered in Dallas, Texas, is one of the largest
healthcare providers by revenue in the US. The company operates 60
hospitals and operates or has an interest in approximately 550
other healthcare facilities including surgical hospitals,
ambulatory surgical centers imaging centers and other care sites
and clinics. Through Conifer Health Solutions the company provides
revenue cycle management and value-based care services. FY 2021
revenues exceeded $19 billion.
The principal methodology used in this rating was Business and
Consumer Services published in November 2021.
THOMASBORO LANDCO: Unsecureds to be Paid in Full in 36 Months
-------------------------------------------------------------
Thomasboro Landco, LLC filed with the U.S. Bankruptcy Court for the
Southern District of Alabama a First Amended Disclosure Statement
for the First Amended Plan of Reorganization dated May 31, 2022.
The Debtor owns 1,137.4 acres of land located in Brunswick County,
North Carolina (the "Thomasboro Property"). The Thomasboro Property
comprises approximately 2,500 entitled residential lots (the
"Entitled Lots"). Thomasboro will develop and sell a portion of the
Entitled Lots as part of its chapter 11 plan of reorganization.
Since the Petition Date, the Debtor has received interest in the
Thomasboro Property from parties other than DR Horton under a
variety of potential deal structures. At present, the Debtor
believes the highest and best use of the Thomasboro Property—and
the best return for the estate — involves the Debtor's
undertaking further development of the Thomasboro Property and
pursuing transactions with buyers other than DR Horton.
Since the Petition Date, the Debtors and DR Horton have been
engaged in settlement discussions to resolve various disputes
related to Galvin's Ridge, the Debtor, and the Thomasboro LPC. The
Debtors have reached a global settlement with DR Horton and filed
an Expedited Motion to Approve Compromise with D.R. Horton, Inc.
(the "Compromise Motion"). Through the Compromise Motion, the
Debtors will seek Court approval of a global settlement between the
Debtors and other non-debtor affiliates, on the one hand, and DR
Horton on the other hand (the "Settlement").
Moreover, subject to Court approval, the Debtor has obtained
debtor-in-possession financing from the DIP Lender in order to pay
off the Stone Farm Lenders and provide funding to develop and sell
the Entitled Lots.
The only unsecured creditor is Criteria Development, LLC which is
owed approximately $1,266,873.00.
The Plan will treat claims as follows:
* Class 1 consists of Priority Claims. Each Holder of an
Allowed Priority Claim will receive (a) on the Distribution Date,
an amount, in Cash, equal to the Allowed Amount of its Priority
Claim, in accordance with Section 1129(a)(9)(B) of the Bankruptcy
Code, (b) under such other terms as may be agreed upon by the
Holder of such Allowed Priority Claim and the Debtor or the
Reorganized Debtor, or (c) as otherwise ordered by Final Order.
Class 1 is Unimpaired.
* Class 2 consists of all Allowed Secured Claims of the Stone
Farm Lenders, which shall include post-petition interest and
reasonable attorneys' fees and costs. The Allowed Secured Claims of
the Stone Farm Lenders will be paid in full from the DIP Loan
proceeds. Such payment shall be in full satisfaction of the Allowed
Secured Claim of the Stone Farm Lenders. Class 2 is Unimpaired.
* Class 3 consists of DIP Loan Claims. The Reorganized Debtor
shall pay the DIP Loan Claims in full in accordance with the DIP
Loan Documents. The terms of the DIP Loan Documents shall remain in
full force and effect, and the DIP Lender shall retain all liens
and security interests in the Collateral provided for under the DIP
Loan Documents and the DIP Financing Order. Class 3 is Unimpaired.
* Class 4 comprises any Allowed Unsecured Claims not otherwise
classified under the Plan. Holders of Class 4 Allowed Unsecured
Claims shall receive payment in full, after payment of the DIP Loan
Claims in full, from net disposable income that the Reorganized
Debtor receives from the sale or disposition of Developed Lots
after the Effective Date. The Reorganized Debtor anticipates that
such proceeds will be sufficient to pay off the Holders of Class 4
Allowed Unsecured Claims within 36 months.Class 4 is Impaired.
* Class 5 comprises all Equity Interests in the Debtor. All
Holders of Equity Interests in the Debtor will retain their Equity
Interests in the Reorganized Debtor in the same proportion as such
interests were held on the Petition Date. Class 5 is Unimpaired.
The Plan provides for the payment of Allowed Claims from the DIP
Loan and the net disposable income that the Reorganized Debtor will
receive from the sale or disposition of Developed Lots after the
Effective Date.
A full-text copy of the First Amended Disclosure Statement dated
May 31, 2022, is available at https://bit.ly/3PSbUu5 from
PacerMonitor.com at no charge.
Counsel for the Debtor:
STICHTER, RIEDEL, BLAIN & POSTLER, P.A.
Edward J. Peterson
Alabama Bar No. 1848-E68E
110 East Madison Street, Suite 200
Tampa, Florida 33602
Telephone: (813) 229-0144
Email: epeterson@srbp.com
About Thomasboro Landco
Thomasboro Landco, LLC filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ala. Case No.
22-10260) on Feb. 11, 2022, listing as much as $50 million in both
assets and liabilities. J. Marion Uter, manager, signed the
petition.
Judge Henry A Callaway presides over the case.
Edward J. Peterson, Esq., at Stichter, Riedel, Blain & Postler,
P.A. and Manning, Fulton & Skinner, P.A. serve as the Debtor's
bankruptcy counsel and special counsel, respectively.
TIDEWATER MIDSTREAM: S&P Lowers ICR to 'CCC' on Watch Developing
----------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Tidewater
Midstream and Infrastructure Ltd., an Alta., Canada-based
diversified midstream and oil refining company, to 'CCC' from 'B-'
and maintained CreditWatch with developing implications.
The CreditWatch placement reflects the uncertainty around the
timing of Tidewater's refinancing of its $125 million senior
notes.
S&P said, "The downgrade reflects our expectation that Tidewater
may not be able to refinance its $125 million senior unsecured
notes prior to June 30, 2022, which will accelerate the RCF
maturity date to Aug. 23, 2022 from Aug. 18, 2024. In our view,
Tidewater will not have sufficient liquidity to repay the $397
million outstanding RCF balance in 2022.
"We project total liquidity sources to be C$195 million over the
next 12 months, which is below the C$397 million outstanding RCF
amount that Tidewater would have to pay in August 2022, if the
notes are not refinanced.
"The CreditWatch placement reflects the uncertainty around the
timing of Tidewater's refinancing of its $125 million notes due
December 2022. We could lower our rating further if we think that
the notes refinancing will not close before June 30, 2022.
Alternatively, if Tidewater improves its liquidity by completing a
refinancing transaction by June 30, 2022, we could raise our rating
by multiple notches."
TPC GROUP: Cerberus Capital Battles SVP Over Bankrupt Company
-------------------------------------------------------------
Steven Church of Bloomberg News reports that some of the biggest
names in distressed investing, including Cerberus Capital
Management and Strategic Value Partners are battling each other for
influence in the bankruptcy case of chemical maker TPC Group Inc.
Two competing groups of noteholders appeared in federal court
Thursday, June 2, 2022, fighting over whose debt TPC must pay
first. They also argued about who should be allowed to fund the
reorganization of the Houston-based company. The dispute threatens
to upend TPC's effort to slash $950 million in debt.
Strategic Value and its allies, including Redwood Capital
Management and Monarch Alternative Capital, are backing a
restructuring deal that would eliminate from the Company's balance
sheet over $950 million of the Company's approximately $1.3 billion
of secured funded debt.
Two bondholders, Bayside Capital, Inc., and Cerberus Capital
Management, L.P., are not supportive of the Plan and have formed an
Ad Hoc Group of Non-Consenting Noteholders.
About TPC Group
TPC Group, headquartered in Houston, is a producer of value-added
products derived from petrochemical raw materials such as C4
hydrocarbons, and provider of critical infrastructure and logistics
services along the Gulf Coast. The Company sells its products into
a wide range of performance, specialty and intermediate markets,
including synthetic rubber, fuels, lubricant additives, plastics
and surfactants. With an operating history of more than 75 years,
TPC Group has a manufacturing facility in the industrial corridor
adjacent to the Houston Ship Channel and operates product terminals
in Port Neches, Texas and Lake Charles, Louisiana.
TPC Group Inc. and its subsidiaries sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 22-10493) on June 1, 2022. TPC Group
estimated assets and debt of $1 billion to $10 billion to $10
billion.
The Hon. Craig T. Goldblatt is the case judge.
Baker Botts L.L.P. is the Debtors' counsel; Morris, Nichols, Arsht
& Tunnell LLP is the co-counsel; Moelis & Company LLC is the
investment banker; and FTI Consulting is the financial advisor.
Simpson Thacher & Bartlett LLP is the special finance counsel.
Kroll Restructuring Administration is the claims agent.
Eclipse Business Capital LLC is advised by Goldberg Kohn Ltd.
Paul Hastings LLP, and Stroock & Stroock & Lavan LLP are serving as
counsel to the Ad Hoc Noteholder Group that supports the Debtors'
restructuring. Evercore Group L.L.C. the Ad Hoc Noteholder Group.
The Supporting Noteholders are funds controlled by FIG LLC and
Fortress Capital Finance III(A)LLC, Monarch Alternative Capital
LP., PGIM Inc., Redwood Capital Management LLC, and Strategic Value
Partners LLC.
Milbank LLP, and Pachulski, Stang, Ziehl & Jones are serving as
counsel to an Ad Hoc Group of Non-Consenting Noteholders, led by
Bayside Capital, Inc., and Cerberus Capital Management, L.P.
TPC GROUP: June 7 Deadline Set for Panel Questionnaires
-------------------------------------------------------
The United States Trustee is soliciting members for committee of
unsecured creditors in the bankruptcy case of TPC Group, Inc. et
al.
If a party wishes to be considered for membership on any official
committee that is appointed, it must complete a Questionnaire
available at https://bit.ly/38P2COC and return by email it to Rosa
Sierra -- Rosa.Sierra-Fox@usdoj.gov -- at the Office of the United
States Trustee so that it is received no later than 4:00 p.m., on
June 7, 2022.
If the U.S. Trustee receives sufficient creditor interest in the
solicitation, it may schedule a meeting or telephone conference for
the purpose of forming a committee.
About TPC Group
TPC Group, headquartered in Houston, is a producer of value-added
products derived from petrochemical raw materials such as C4
hydrocarbons, and provider of critical infrastructure and logistics
services along the Gulf Coast. The Company sells its products into
a wide range of performance, specialty and intermediate markets,
including synthetic rubber, fuels, lubricant additives, plastics
and surfactants. With an operating history of more than 75 years,
TPC Group has a manufacturing facility in the industrial corridor
adjacent to the Houston Ship Channel and operates product terminals
in Port Neches, Texas and Lake Charles, Louisiana.
TPC Group Inc. and its subsidiaries sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 22-10493) on June 1, 2022. TPC Group
estimated assets and debt of $1 billion to $10 billion to $10
billion.
The Hon. Craig T. Goldblatt is the case judge.
Baker Botts L.L.P. is the Debtors' counsel; Morris, Nichols, Arsht
& Tunnell LLP is the co-counsel; Moelis & Company LLC is the
investment banker; and FTI Consulting is the financial advisor.
Simpson Thacher & Bartlett LLP is the special finance counsel.
Kroll Restructuring Administration is the claims agent.
Eclipse Business Capital LLC is advised by Goldberg Kohn Ltd.
Paul Hastings LLP, and Stroock & Stroock & Lavan LLP are serving as
counsel to the Ad Hoc Noteholder Group that supports the Debtors'
restructuring. Evercore Group L.L.C., is the Group's financial
advisor. Young Conaway Stargatt & Taylor, LLP is local counsel to
the Ad Hoc Noteholder Group. The Supporting Noteholders are funds
controlled by FIG LLC and Fortress Capital Finance III(A)LLC,
Monarch Alternative Capital LP., PGIM Inc., Redwood Capital
Management LLC, and Strategic Value Partners LLC.
Milbank LLP, and Pachulski, Stang, Ziehl & Jones are serving as
counsel to an Ad Hoc Group of Non-Consenting Noteholders, led by
Bayside Capital, Inc., and Cerberus Capital Management, L.P.
TPC GROUP: Milbank, Pachulski Advise Non-Consenting Bondholders
---------------------------------------------------------------
In the Chapter 11 cases of TPC Group Inc., et al., the law firms of
Milbank LLP and Pachulski, Stang, Ziehl & Jones submitted a
verified statement under Rule 2019 of the Federal Rules of
Bankruptcy Procedure, to disclose that they are representing the Ad
Hoc Group of Non-Consenting Noteholders.
In February 2022, the Ad Hoc Group of Non-Consenting Noteholders
retained Milbank as its counsel with respect to the Ad Hoc Group of
Senior Noteholders' holdings of the 10.5% senior secured notes due
2024 issued by TPC Inc., or one or more of its subsidiaries or
affiliates. The Ad Hoc Group of Non-Consenting Noteholders
Subsequently Retained Pachulski to Serve as its Delaware local
counsel in connection with the chapter 11 cases of TPC Group Inc.,
and its affiliated debtors.
As of May 31, 2022, members of the Ad Hoc Group of Non-Consenting
Noteholders and their disclosable economic interests are:
Bayside Capital, Inc.
1450 Brickell Ave, 31st Floor
Miami, FL 33131
* $47,000,000.00 of 10.5% Notes Claims
Cerberus Capital Management, L.P.
875 3rd Ave
New York, NY 10022
* $43,061,000.00 of 10.5% Notes Claims
The information contained herein is provided only for the purpose
of complying with Bankruptcy Rule 2019 and is not intended for any
other use or purpose.
Counsel reserves the right to amend this Verified Statement as may
be necessary in accordance with the requirements set forth in
Bankruptcy Rule 2019.
Counsel for the Ad Hoc Group of Non-Consenting Noteholders can be
reached at:
PACHULSKI, STANG, ZIEHL & JONES
Laura Davis Jones, Esq.
Timothy P. Cairns, Esq.
919 North Market Street, 17th Floor
P.O. Box 8705
Wilmington, DE 19899
Telephone: (302) 652-4100
Facsimile: (302) 652-4400
E-mail: ljones@pszjlaw.com
tcairns@pszjlaw.com
- and -
MILBANK LLP
Gerard Uzzi, Esq.
Nelly Almeida, Esq.
55 Hudson Yards
New York, NY 10001
Telephone: (212) 530-5000
Facsimile: (212) 530-5219
E-mail: guzzi@milbank.com
nalmeida@milbank.com
Aaron L. Renenger, Esq.
John P. Estep, Esq.
1850 K Street NW, Suite 1100
Washington, DC 20006
Telephone: (202) 835-7500
Facsimile: (202) 263-7586
E-mail: arenenger@milbank.com
jestep@milbank.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/3NNoadm and https://bit.ly/3aiUvKD
About TPC Group
TPC Group, headquartered in Houston, is a producer of value-added
products derived from petrochemical raw materials such as C4
hydrocarbons, and provider of critical infrastructure and logistics
services along the Gulf Coast. The Company sells its products into
a wide range of performance, specialty and intermediate markets,
including synthetic rubber, fuels, lubricant additives, plastics
and surfactants. With an operating history of more than 75 years,
TPC Group has a manufacturing facility in the industrial corridor
adjacent to the Houston Ship Channel and operates product terminals
in Port Neches, Texas and Lake Charles, Louisiana.
TPC Group Inc. and its subsidiaries sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 22-10493) on June 1, 2022. TPC Group
estimated assets and debt of $1 billion to $10 billion to $10
billion.
The Hon. Craig T. Goldblatt is the case judge.
Baker Botts L.L.P. is the Debtors' counsel; Morris, Nichols, Arsht
& Tunnell LLP is the co-counsel; Moelis & Company LLC is the
investment banker; and FTI Consulting is the financial advisor.
Simpson Thacher & Bartlett LLP is the special finance counsel.
Kroll Restructuring Administration is the claims agent. The
Supporting Noteholders are advised by Paul Hastings LLP and
Evercore.
Eclipse Business Capital LLC is advised by Goldberg Kohn Ltd.
TPC GROUP: Paul Hastings, YCST Advise Supporting Noteholders
------------------------------------------------------------
In the Chapter 11 cases of TPC Group Inc., et al., the law firms of
Paul Hastings LLP and Young Conaway Stargatt & Taylor, LLP
submitted a verified statement under Rule 2019 of the Federal Rules
of Bankruptcy Procedure, to disclose that they are representing Ad
Hoc Noteholder Group.
As of June 1, 2022, members of the Ad Hoc Group and their
disclosable economic interests are:
FIG LLC and Fortress Capital Finance III (A) LLC
1345 Avenue of the Americas 46 Fl
New York, NY 10105
* $3,971.552.00 of 10.875% Senior Secured Notes due 2024
* $47,750.000.00 of 10.5% Senior Secured Notes due 2024
Monarch Alternative Capital LP
535 Madison Avenue
New York, NY 10022
* $8,945.413.00 of 10.875% Senior Secured Notes due 2024
* $127,000.000.00 of 10.5% Senior Secured Notes due 2024
PGIM, Inc.
P.O. Box 32339
Newark NJ 07102
* $63,467.382.00 of 10.875% Senior Secured Notes due 2024
* $162,738.000.00 of 10.5% Senior Secured Notes due 2024
Redwood Capital Management, LLC
250 West 55th Street
26 Fl New York, NY 10019
* $66,144.439.00 of 10.875% Senior Secured Notes due 2024
* $270,343.000.00 of 10.5% Senior Secured Notes due 2024
Strategic Value Partners, LLC
100 West Putnam Avenue
Greenwich, CT 06830
* $45,752.428.00 of 10.875% Senior Secured Notes due 2024
* $137,949.000.00 of 10.5% Senior Secured Notes due 2024
Counsel to the Ad Hoc Noteholder Group can be reached at:
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Matthew B. Lunn, Esq.
Robert F. Poppiti, Jr., Esq.
1000 North King Street
Wilmington, DE 19801
Telephone: (302) 571-6600
Facsimile: (302) 576-3312
E-mail: mlunn@ycst.com
rpoppiti@ycst.com
- and -
Kristopher M. Hansen, Esq.
Kenneth Pasquale, Esq.
Erez E. Gilad, Esq.
Jonathan D. Canfield, Esq.
Gabriel E. Sasson, Esq.
PAUL HASTINGS LLP
200 Park Avenue
New York, NY 10166
Telephone: (212) 318-6000
Facsimile: (212) 319-4090
Email: krishansen@paulhastings.com
kenpasquale@paulhastings.com
erezgilad@paulhastings.com
joncanfield@paulhastings.com
gabesasson@paulhastings.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/3NdJZmz and https://bit.ly/3MdWNb6
About TPC Group
TPC Group, headquartered in Houston, is a producer of value-added
products derived from petrochemical raw materials such as C4
hydrocarbons, and provider of critical infrastructure and logistics
services along the Gulf Coast. The Company sells its products into
a wide range of performance, specialty and intermediate markets,
including synthetic rubber, fuels, lubricant additives, plastics
and surfactants. With an operating history of more than 75 years,
TPC Group has a manufacturing facility in the industrial corridor
adjacent to the Houston Ship Channel and operates product terminals
in Port Neches, Texas and Lake Charles, Louisiana.
TPC Group Inc. and its subsidiaries sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 22-10493) on June 1, 2022. TPC Group
estimated assets and debt of $1 billion to $10 billion to $10
billion.
The Hon. Craig T. Goldblatt is the case judge.
Baker Botts L.L.P. is the Debtors' counsel; Morris, Nichols, Arsht
& Tunnell LLP is the co-counsel; Moelis & Company LLC is the
investment banker; and FTI Consulting is the financial advisor.
Simpson Thacher & Bartlett LLP is the special finance counsel.
Kroll Restructuring Administration is the claims agent.
The Supporting Noteholders are advised by Paul Hastings LLP and
Evercore.
Eclipse Business Capital LLC is advised by Goldberg Kohn Ltd.
TRANSOCEAN LTD: Frederik Mohn Reports 12.2% Equity Stake
--------------------------------------------------------
In an amended Schedule 13D filed with the Securities and Exchange
Commission, these entities and individual reported beneficial
ownership of shares of common stock of Transocean Ltd. as of May
13, 2022:
Shares Percent
Beneficially of
Reporting Person Owned Class
---------------- ------------- -------
Frederik W. Mohn 82,831,418 12.2%
Perestroika AS 82,596,498 12.1%
Perestroika (Cyprus) Ltd. 67,696,498 9.94%
The percentages are based upon the 681,055,951 Shares outstanding
as of April 25, 2022, as disclosed by the Issuer in the Issuer's
Quarterly Report on Form 10-Q filed with the SEC on May 3, 2022.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/1451505/000110465922062018/tm2215860d1_sc13da.htm
About Transocean
Transocean Ltd. is an international provider of offshore contract
drilling services for oil and gas wells. The Company specializes in
technically demanding sectors of the offshore drilling business
with a particular focus on ultra-deepwater and harsh environment
drilling services.
Transocean reported a net loss of $591 million for the year ended
Dec. 31, 2021, a net loss of $568 million for the year ended Dec.
31, 2020, and a net loss of $1.25 billion for the year ended Dec.
31, 2019. As of March 31, 2022, the Company had $20.36 billion in
total assets, $1.35 billion in total current liabilities, $7.88
billion in total long-term liabilities, and $11.13 billion in total
equity.
* * *
As reported by the TCR on July 12, 2021, S&P Global Ratings raised
its issuer credit rating on Switzerland-based offshore drilling
company Transocean Ltd. to 'CCC' from 'CCC-'. S&P said, "Our 'CCC'
issuer credit rating reflects the potential that the company will
undertake additional distressed transactions over the next year.
Although Transocean has taken steps to improve its liquidity, it
still has significant debt maturities and high capital spending
requirements over the next two years."
TRIDENT HOLDINGS: Amends Residential Mortgage Secured Claim Pay
---------------------------------------------------------------
Trident Holdings LLC submitted a First Amended Plan of
Reorganization for Small Business dated May 31, 2022.
The Debtor is a limited liability company which has been in the
business of development of real estate. There is a prospective
health care tenant whose anticipated rent payments of approximately
$30,000 a month will assure a successful reorganization.
The Plan Proponent's financial projections show that the Debtor
will have projected disposable income of $240,000. The final Plan
payment is expected to be paid on September of 2027.
Class 2A consists of the Secured claim of Residential Mortgage Loan
Trust I. This claim of $1,683,494.89, as evidenced by the proof of
claim No. 7, shall be satisfied through monthly payments in the
amount of $9,296.32, which is the amount amortized over 30 years at
5.25%, with a balloon payment after 15 years.
Like in the prior iteration of the Plan, non-priority unsecured
creditors shall collectively receive and shall share, pro rata,
monthly disbursements by the Debtor in the amount of $4,000 a month
for a period of 60 months for a total of $240,000.
The Debtor shall lease the premises to an entity that has obligated
itself to a multi-year stabilized rents in the amount of $30,000.
In addition, as necessary, the members of the Debtor are willing to
make capital contributions.
A full-text copy of the First Amended Plan of Reorganization dated
May 31, 2022, is available at https://bit.ly/3zhNS5V from
PacerMonitor.com at no charge.
Attorney for the Plan Proponent:
David A. Riggi, Esq.
Riggi Law Firm
5550 Painted Mirage Rd. Suite 320
Las Vegas, NV 89149
Tel: (702) 463-7777
Fax: (888) 306-7157
Email: RiggiLaw@gmail.com
About Trident Holdings
Trident Holdings, LLC, filed a petition for Chapter 11 protection
(Bankr. D. Nev. Case No. 21-14872) on Oct. 8, 2021, listing as much
as $10 million in both assets and liabilities. James Ronald
Clark, managing member of Trident Holdings, signed the
petition.
Judge Natalie M. Cox oversees the case.
David A. Riggi, Esq., at Riggi Law Firm, is the Debtor's legal
counsel.
VERTEX ENERGY: Board OKs Stock Option Grants to CEO, CFO
--------------------------------------------------------
Effective May 12, 2022, the Board of Directors and Compensation
Committee of the Board of Directors of Vertex Energy, Inc., in
connection with the Company's annual equity compensation review,
approved:
(a) the grant of incentive stock options to (i) Benjamin P.
Cowart, the president and chief executive officer of the Company
(options to purchase 28,813 shares); and (ii) Chris Carlson, the
chief financial officer and secretary of the Company (options to
purchase 18,196 shares), in consideration for services rendered and
to be rendered to the Company; and
(b) the grant of incentive stock options to purchase an
aggregate of 197,925 shares of the Company's common stock to
twenty-seven non-executive employees of the Company, in
consideration for services rendered and to be rendered to the
Company.
The options were granted under the Company's 2019 Equity Incentive
Plan and the options (other than Mr. Cowart's options) had a term
of ten years; provided that Mr. Cowart's options had a term of five
years, subject in all cases to the terms and conditions of the Plan
and the award agreements to be entered into to evidence such
grants, and each officer's or employee's continued service with the
Company. The Options vest to each individual at the rate of 1/4th
of such awarded Options per year on each of May 12, 2023, 2024,
2025 and 2026. The options (other than Mr. Cowart's) had an
exercise price of $11.90 per share, the closing sales price of the
Company's common stock on the NASDAQ Capital market on May 12,
2022; provided that Mr. Cowart's Options had an exercise price of
$13.09 per share, representing 110% of the Market Price. The Plan
has been registered on a Form S-8 Registration Statement previously
filed by the Company with the Securities and Exchange Commission.
About Vertex Energy
Houston-based Vertex Energy, Inc. (NASDAQ: VTNR) is a specialty
refiner of alternative feedstocks and marketer of petroleum
products. Vertex is one of the largest processors of used motor oil
in the U.S., with operations located in Houston and Port Arthur
(TX), Marrero (LA) and Heartland (OH). Vertex also co-owns a
facility, Myrtle Grove, located on a 41-acre industrial complex
along the Gulf Coast in Belle Chasse, LA, with existing
hydro-processing and plant infrastructure assets, that include nine
million gallons of storage. The Company has built a reputation as
a key supplier of Group II+ and Group III Base Oils to the
lubricant manufacturing industry throughout North America.
Vertex Energy reported a net loss of $7.66 million for the year
ended Dec. 31, 2021, a net loss of $11.40 million for the year
ended Dec. 31, 2020, and a net loss of $5.49 million for the year
ended Dec. 31, 2019. As of Dec. 31, 2021, the Company had $266.06
million in total assets, $192.55 million in total liabilities,
$43.45 million in total temporary equity, and $30.07 million in
total equity.
VOS CRE I: Amends Plan to Include Daniel J. Vosotas Trust Claim
---------------------------------------------------------------
VOS CRE I, LLC, submitted a First Amended Small Business Plan of
Reorganization under Subchapter V dated May 31, 2022.
The Debtor filed this case because it suffered a liquidity crisis
from the freezing of the $8.5 million from the sale of the David
Whitney Building. With the access to that liquidity, as a result of
the Settlement Agreement, the Debtor would be able to pay its
liabilities, fund its litigation in connection with the Greystone
hotel, and make a meaningful distribution to the Holders of Allowed
Interests.
Class 2 consists of Allowed E-B5 Unsecured Claims. All claimants
who have asserted a claim based upon an E-B5 investment. These
Claims have been disallowed by the Court.
Class 3 consists of Insider Claim of VOS Holdings I, LLC. This
Claim shall be paid $25,000.00 in full satisfaction of any claim
against the Debtor.
Class 4 consists of Insider claims of Trans Inns Management, Inc.
This Claim shall be paid $5,000.00 in full satisfaction of any
claim against the Debtor.
Class 5 consists of Equity Interest Holders, except for the VOS
Holdings I LLC and Daniel Vosotas. Consistent with the Settlement
Agreement, these interests shall be extinguished.
Class 6 consists of VOS Holdings I LLC. This claim shall receive
$15,000.00 in return for the extinguishment of its equity in the
Debtor.
Class 7 consists of Daniel J. Vosotas Trust D/A/O Feb. 2, 1996 or
its assignee claim. This claim shall receive the remaining equity
in the Debtor.
On Confirmation of the Plan, all property of the Debtor, tangible
and intangible, including, without limitation, licenses, furniture,
fixtures and equipment, will revert, free and clear of all Claims
and Equitable Interests except as provided in the Plan, to the
Debtor. The Debtor expects to have sufficient cash on hand to make
the payments required on the Effective Date. The Debtor shall use
its portion of the funds from the Settlement Agreement to make the
payments required under the Plan.
A hearing on confirmation of the Plan is scheduled for July 13,
2022 at 2:00 P.M. in Courtroom No. B at the U.S. Bankruptcy Court
Flagler Waterview Building 1515 North Flagler Drive, 8th Floor
Courtroom: B West Palm Beach, FL 33401.
Objections to confirmation of the Plan must be filed by July 8,
2022, while ballots stating whether to accept or reject the Plan
must be filed by July 6, 2022.
A full-text copy of the First Amended Plan dated May 31, 2022, is
available at https://bit.ly/3PZWwMk from PacerMonitor.com at no
charge.
Counsel for the Debtor:
DGIM Law, PLLC
Isaac Marcushamer, Esq.
Florida Bar No. 0060373
Isaac@dgimlaw.com
Daniel Gielchinsky, Esq.
Florida Bar No. 97646
Dan@dgimlaw.com
2875 NE 191st Street, Suite 705
Aventura, FL 33180
Tel: (305) 763-8708
About VOS CRE I
Boca Raton, Fla.-based VOS CRE I, LLC filed its voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Fla. Case No. 21-21082) on Nov. 22, 2021, listing as much as $10
million in both assets and liabilities. James Vosotas, authorized
representative, signed the petition.
The Debtor tapped Isaac Marcushamer, Esq., at DGIM Law, PLLC as
legal counsel and Berkowitz Pollack Brant Advisors and CPAs as
financial advisor and tax accountant.
VS DEVELOPING: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: VS Developing LLC
4415 Priest Point Dr NW
Tutalip, WA 98271-6814
Business Description: VS Developing is a Single Asset Real Estate
(as defined in 11 U.S.C. Section 101(51B)).
Chapter 11 Petition Date: June 2, 2022
Court: United States Bankruptcy Court
Western District of Washington
Case No.: 22-10916
Debtor's Counsel: Benjamin Ellison, Esq.
SALISH SEA LEGAL PLLC
2212 Queen Anne Ave N., No. 719
Seattle, WA 98109
Tel: 206-257-9547
Email: salishsealegal@outlook.com
Total Assets: $1,400,000
Total Liabilities: $2,256,766
The petition was signed by Valentin Stelmakh as managing member.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/RRHARHA/VS_Developing_LLC__wawbke-22-10916__0001.0.pdf?mcid=tGE4TAMA
WAYNE HEALTHCARE: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable
------------------------------------------------------------------
Fitch Ratings has affirmed Wayne Healthcare's (WH) 'BB'+' Issuer
Default Rating (IDR) and the 'BB+' Long-Term rating assigned to
series 2019A hospital revenue bonds issued by Darke County (OH) on
behalf of WH.
The Rating Outlook is Stable.
SECURITY
The bonds are secured by a pledge of security interest on the gross
receipts of the obligated group, a mortgage lien on the hospital
and a debt service reserve fund.
ANALYTICAL CONCLUSION
The affirmation of the 'BB+' rating and Stable Outlook reflect WH's
successful navigation of pandemic related stresses to-date and the
completion of its patient tower project which opened last March.
Despite incurring additional debt for the tower project, and having
to address pandemic driven supply chain and labor cost challenges,
the hospital has continued to build up its unrestricted reserves
and generate cash flow more than sufficient to cover debt service
at maximum annual debt service (MADS).
While first quarter results YTD are more constrained, and WH
expects weaker near-term operating performance potentially through
fiscal years 2022 and 2023, which will restrain some of WH's
financial metrics. Fitch believes that WH will continue to manage
through the challenges and maintain an adequate balance sheet
cushion. With a sustained financial cushion and provided operating
performance either exceeds expectations or rebounds to recent
historical performance, WH will offer a case for positive rating
action over time.
While the 'bbb' financial profile assessment suggests a higher
long-term rating now, the 'BB+' rating also incorporates the
hospital's weak revenue defensibility and midrange operating risk
profile assessments. WH's payor mix is weak given its 30% combined
gross Medicaid and self-pay revenues. It also operates in a
relatively competitive rural and narrow service area. Additionally,
the 'BB+' rating considers the risk associated with WH's dependence
on a limited number of physicians for admissions and revenue, which
can introduce a higher risk of operational volatility.
The Stable Outlook reflects Fitch's expectation that WH will
maintain adequate leverage and liquidity metrics while it navigates
near-term operating disruptions associated with pandemic and post
pandemic related challenges. Fitch expects those to moderate over
time which will provide Fitch with the opportunity to reassess the
Outlook or rating level.
KEY RATING DRIVERS
Revenue Defensibility: 'bb'
Competitive and narrow market; Constrained Payor Mix
WH has a weak revenue defensibility due to a relatively competitive
market and a weak payor mix. Despite a leading PSA market position
of almost 38% in 2021, WH faces competition from other hospitals in
its broader service area, with four similarly sized hospitals and
two larger hospitals operating within 40 miles. WH also has a weak
payor mix, with a high but modestly improving concentration of
government payors and Medicaid and self-pay totaling an elevated
30% of 2021 gross revenues.
Operating Risk: 'bbb'
Robust Operating Profile Despite Near-Term Compression
WH's operating risk assessment is midrange. WH has seen some
volatility in operating performance over the last few years, but
managed well through the early stages of the pandemic and has
sustained very favorable operating performance through fiscal 2021.
Despite that with escalating labor and supplies costs operations
are expected to be stressed over the near term likely resulting in
operating EBITDA and EBITDA margins well below results for FY 2020
and FY 2021 potentially compressing to 5%-7% during the next two
fiscal years.
Nevertheless, Fitch expects that moderating inflation and organic
revenue growth to help WH to restore operating EBITDA margins to
between 7% and 9% over the next three to four fiscal years
particularly given that WH's capital spending plans have moderated
significantly now that the patient tower project is complete. Fitch
understands that planned capital spending will be mostly routine
over the next and capped at $1.5 million except for IT related
spending expected in FY 2023 and FY 2024 related to WH's Epic EHR
implementation and WH's supply chain and PACS software upgrades.
Financial Profile: 'bbb'
Through the Cycle
WH's is expected to maintain solid balance sheet metrics throughout
Fitch's forward-looking analysis despite expectations for near-term
margin compression and market volatility due to current economic
conditions. As expected, WH's financial position weakened following
the increase in debt and the equity contribution related to the new
patient tower but both unrestricted reserves and leverage improved
in FY 2021.
WH plans to use unrestricted reserves to pay off its $14.9 million
bank direct placement in July 2022 which will reduce days cash to
543 days by Fitch's calculation but will result in FY 2022
cash-to-adjusted debt exceeding 230% which is fully in-line with
the 'bbb' financial profile assessment. Following the payoff of
directly placed bank debt, WH will have $47 million of outstanding
debt of which 92% was fixed rate or synthetically fixed rate debt.
The swap was terminated on May 12, 2022 in anticipation of the
payoff of the bank direct placement this summer. Following the
payoff of the bank direct placement, WH's MADS will decline to
$2.91 million from $3.91 million. MADS coverage at FYE 2021 was
5.1x. With the expected compression of operating margins in FY 2022
(and inclusive of the reduction in MADS following the debt paydown)
MADS coverage for FY 2022 is expected to be approximately 2.5x.
Asymmetric Additional Risk Considerations
There are no asymmetric rating considerations.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Sustained operating EBITDA margins at or above 8% over time,
inclusive of expected near term financial performance, that
demonstrates and a demonstrated period of reduced operating
volatility;
-- Cash-to-adjusted debt that is sustained above 200% which,
while elevated relative to the minimum metric to achieve an
investment-grade rating incorporates WH's size, payor mix,
competitive position and narrow market;
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A significant decline in liquidity due to either an increase
in incremental debt or high capital spending without
commensurate growth in cash flow that leads to cash-to-
adjusted debt that is sustained below 100%;
-- A sustained weakening in operating EBITDA margins to below 7%
beyond the expected constrained operating performance during
FY 2022 and potentially FY 2023;
-- Although not expected, should economic conditions materially
weaken relative to Fitch's current outlook, or if there is
another infection wave that materially constrains financial
performance resulting in a materially more tepid recovery over
the next few years, WH could face negative rating pressure.
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
Wayne Hospital d/b/a as Wayne Healthcare is a 104 licensed bed (61
staffed) acute care hospital located in Greenville, OH,
approximately 50 miles northwest of Dayton, OH. In fiscal 2019, WH
had total operating revenues of approximately $76 million. The
obligated group consists WH and a professional services group, WHC
Professional Services LLC. Non-obligated affiliates are included
within WH's consolidated financial statements and are not
material.
As of April 2017, WH and Premier Health signed an affiliation
agreement for the purposes of collaboration between the two
entities. The intent of the collaboration is to enhance development
of resources for new facilities and programs, maintain and provide
medical services for the underserved, and to further collaboration
and integration between WH and Premier Health.
As part of the agreement, Premier Health purchased a 33.3%
ownership position in WH for $13 million and has the right to
appoint six of the 18 members on WH's board of directors. Premier
Health does not collect yearly earnings from WH. The affiliation
term was extended in 2020 and currently runs through April 2029 and
allows WH three options at the end of the term: become a party to
Premier Health's joint operating agreement; pursue another
agreement with Premier Health; or terminate the affiliation which
includes a fair market value buyout price to Premier Health.
Premier Health is not obligated on WH's debt and does not provide a
guarantee of the debt.
Fitch is cognizant that a termination by WH of its affiliation
agreement with Premier Health at the end of the current agreement
in 2029 would result in a repayment to Premier Health, but does not
view it at this time as an asymmetric risk. If WH elects to end
their affiliation with Premier Health a buyout price will be
negotiated based on a determined fair market value.
Revenue Defensibility
WH's payor mix is weak, with Medicaid accounting for an elevated
27.7% of the gross payor revenues and self-pay accounting for
another 2.6% as of as of March 2022. The payor mix is noted to have
heightened exposure to governmental payors, with 54.8% attributed
to Medicare. Fitch expects WH's combined Medicaid and self-pay
payor mix to remain above 30% for the foreseeable future.
WH participates in the Hospital Care Assurance Program (HCAP) which
provides for additional payments to hospitals that administer a
disproportionate share of uncompensated services to the indigent
and uninsured. Under HCAP, all Ohio not-for-profit hospitals
provide free care at or below the federal poverty guidelines. Net
amounts recorded by WH from HCAP totaled approximately $1.05
million in FY 2021 and are projected to be $1.148 million for FY
2022.
Operating Risk
WH's operating cost flexibility is assessed as midrange. While
operating EBITDA margins have averaged a solid 9.3% over the last
five fiscal years, there has been year to year volatility,
highlighting WH's sensitivity to swings in volume and reimbursement
programs. Operating EBITDA was solid in fiscal 2021 at 10.6%,
although moderately more constrained than FY 2020 due to reduced
Cares Act stimulus funding for FY 2021 and due to inflationary
pressures on labor and supplies.
After receiving about $10.9 million of Cares Act stimulus in FY
2020, WH received approximately $2.8 million for FY 2021 plus an
additional $102,000 of rural funding. WH opted not to take Medicare
Advance payments as the hospital's cash position was and remains
solid.
The effects of the pandemic, particularly the resulting
inflationary pressures are expected to continue to constrain WH's
operations over the next one to two years, consistent with
pressures facing hospitals sector wide. WH will almost certainly
show a considerable softening of margins in fiscal 2022, primarily
due to the elevated labor and supplies expense but also due to the
spike in Covid cases earlier in the year. Historically WH was able
to transfer its Covid patients to Premier, making WH a "Covid free"
hospital, but its ability to make those transfers was suspended in
November 2021.
Patient volumes are largely recovering from the pandemic although
have not yet been restored to pre- pandemic levels. Fitch expects
continued overall improvement over time, particularly absent
another Covid pause on elective procedures, particularly given the
new tower, better than projected orthopedic volumes, and from WH's
new pain management service line which is a 51% joint venture for
WH with Pain Management Group. Despite the expectation for
near-term margin compression, Fitch expects WH's operating
performance to rebound with operating EBITDA margins between 7%-9%
through the cycle.
Financial Profile
WH's financial profile assessment is midrange. WH has consistently
generated positive cash flows that have historically sustained
strong balance sheet metrics, as evidenced by cash to adjusted debt
averaging 252% from 2017-2021, albeit lower but still solid more
recently with a 175% cash-to-adjusted debt as of March 31, 2022.
Unrestricted cash declined with market volatility to $109 million
as of March 31, 2022 from $113 million at FYE 2021, but still
measured very strong at 604 days cash on hand (DCOH).
WH's balance sheet and leverage metrics remain solid through
Fitch's new base case and stress case scenarios that incorporate
Fitch's current estimates of a sharp decline in investment
portfolio holdings and financial stress from more constrained
operations in FY 2022. Fitch's analytic expectations are based on
the financial metrics which reflect balance sheet metrics that
still provide an adequate cushion above the thresholds for the
'bbb' financial profile assessment for a hospital with weak revenue
defensibility and a mid-range operating risk profile. The scenario
incorporates the expectation that WH pay off the 2019B bank direct
placement bonds with cash this July.
Asymmetric Additional Risk Considerations
There are no asymmetric risk considerations affecting the IDR and
revenue bond rating determination.
After the planned payoff of the $14.9 million of series 2019B
direct placement debt, WH's total long- term bonded debt will be
approximately $47 million. As noted WH terminated its swap on May
12 in anticipation of the debt payoff. The swap was terminated at a
cost of $1.17 million. The termination payment was funded from WH's
$1.7 million of lower volume hospital provider funds, eliminating
the need for WH to draw down cash.
At FYE WH's MADS was just under $4 million and the fiscal 2021 MADS
coverage ratio was 5.2X. After payoff of the series 2019B bonds
WH's MADS declines to $2.9 million. Projected MADS coverage for FY
2022 will decrease to 2.5x assuming weaker operating performance in
FY 2022. Projected days cash will decline, but remain very robust
at more than 540 days. WH's financial covenants of 1.2X MADS
coverage and 75 days DCOH are tested annually at YE.
In addition to the sources of information identified in Fitch's
applicable criteria specified below, this action was informed by
information from Lumesis.
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 PRIOR
---- ------ -----
Wayne Healthcare (OH) LT IDR BB+ Affirmed BB+
Wayne Healthcare (OH) LT BB+ Affirmed BB+
/General Revenues/1 LT
WHITE RABBIT: Wins Cash Collateral Access Thru June 30
------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Washington at
Vancouver authorized White Rabbit Ventures, Inc., dba Matrix
Roofing, and Home Solutions dba Matrix Roof+Home to use cash
collateral on a further interim basis in accordance with the budget
through June 30, 2022.
The U.S. Small Business Administration is granted a replacement
lien in the Debtor's post-petition assets, to the same extent,
validity, and priority it had in the Debtor's pre-petition assets,
excluding any security interests in avoidance actions pursuant to
sections 506(c), 544, 545, 547, 548, and 549 of the Bankruptcy
Code, and without prejudice to the ability of the Debtor or its
creditors to contest the amount, validity and priority of the
replacement lien.
A continued hearing on the matter is scheduled June 23 at 9 a.m. by
telephone.
A copy of the order and the Debtor's budget for June 2022 is
available at https://bit.ly/3GGs1H0 from PacerMonitor.com. The
Debtor projects $229,346 in total cost of goods and expenses.
About White Rabbit Ventures, Inc.
White Rabbit Ventures, Inc. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. W.D. Wash. Case No. 22-40173-MJH)
on February 14, 2022. In the petition signed by Wendy J. Marvin,
chief executive officer, the Debtor disclosed up to $1 million in
assets and up to $10 million in liabilities.
Judge Mary Jo Heston oversees the case.
Geoffrey Groshong, Esq., at Groshong Law PLLC is the Debtor's
counsel.
YUNHONG CTI: Incurs $7.6 Million Net Loss in 2021
-------------------------------------------------
Yunhong CTI Ltd. filed with the Securities and Exchange Commission
its Annual Report on Form 10-K disclosing a net loss of $7.55
million on $24.09 million of net sales for the 12 months ended Dec.
31, 2021, compared to a net loss of $4.30 million on $21.06 million
of net sales for the 12 months ended Dec. 31, 2020.
As of Dec. 31, 2021, the Company had $17.28 million in total
assets, $13.23 million in total liabilities, and a total
stockholders' equity of $4.05 million.
The Company has a cumulative net loss from inception to Dec. 31,
2021 in excess of $20 million. The accompanying financial
statements for the year ended Dec. 31, 2021 have been prepared
assuming the Company will continue as a going concern. The Company
said its cash resources may be insufficient to meet its anticipated
needs during the next twelve months. The Company may require
additional funding on acceptable terms to support it is planned
future operations. Management's plans include executing on its
business plan and raising external funds to the extent needed. If
the Company is not successful, there is substantial doubt about the
ability to continue as a going concern for one year from the
issuance of the accompanying consolidated financial statements.
The Company's primary sources of liquidity have traditionally been
comprised of cash and cash equivalents as well as availability
under a Credit Agreement. Until Sept. 30, 2021, that Credit
Agreement was with PNC, which began in December 2017 as an $18
million revolving credit facility and a $6 million term loan. The
Company encountered a series of challenges in meeting conditions of
that agreement, which added to liquidity issues and raised an issue
regarding its ability to continue as a going concern during that
period.
New York, NY-based RBSM LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated April
15, 2022, citing that the Company has suffered recurring losses
from operations and will require additional capital to continue as
a going concern. This raises substantial doubt about the Company's
ability to continue as a going concern.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1042187/000143774922009039/ctib20211231_10k.htm
About Yunhong CTI
Lake Barrington, Illinois-based Yunhong CTI Ltd. --
www.ctiindustries.com -- develops, produces, distributes and sells
a number of consumer products throughout the United States and in
over 30 other countries, and it produces film products for
commercial and industrial uses in the United States. Many of the
Company's products utilize flexible films and, for a number of
years, it has been a leading developer of innovative products which
employ flexible films including novelty balloons, pouches and films
for commercial packaging applications.
ZOTEC PARTNERS: Moody's Lowers CFR & First Lien Debt to B3
----------------------------------------------------------
Moody's Investors Service downgraded Zotec Partners, LLC Corporate
Family Rating to B3 from B2, and Probability of Default rating to
B3-PD from B2-PD. Moody's also downgraded the ratings on the
company's first-lien credit facilities to B3 from B2. The outlook
is stable.
The rating downgrades are driven by Zotec's weaker than expected
profitability and cash flow, following the implementation of a very
large client win announced in 2020. Zotec's operating performance
has been negatively impacted by rising labor costs and higher than
anticipated integration expenses. The downgrade reflects Moody's
expectations for softer credit metrics and weaker cash flow
generation over the next 12 to 18 months. Zotec's approaching debt
maturities are also a negative credit consideration. ESG
considerations were not a key driver of the rating action.
The following ratings/assessments are affected by the action:
Ratings Downgraded:
Issuer: Zotec Partners, LLC
Corporate Family Rating, Downgraded to B3 from B2
Probability of Default Rating, Downgraded to B3-PD from B2-PD
Senior Secured Bank Credit Facility, Downgraded to B3 (LGD3) from
B2 (LGD3)
Outlook Actions:
Issuer: Zotec Partners, LLC
Outlook, Remains Stable
RATINGS RATIONALE
Zotec's ratings reflect its small scale in a competitive industry,
with $292 million of revenue as of the twelve months ending March
2022. Zotec's revenue is relatively concentrated in niche
healthcare segments, compared to larger and more diversified peers
in the revenue cycle management ("RCM") market. The company has
been able to grow its target healthcare verticals through selective
M&A and new contracts, but over 40% of revenue is still generated
by radiology clients. Sizeable contract wins over the last two
years have contributed to very strong revenue growth, but have also
increased customer concentration and pressured profitability due to
higher than anticipated implementation costs. Debt/EBITDA is
expected to increase above 6x over the next 12 months. Higher
leverage and the expectation for negative free cash flow in 2022
(Moody's adjusted, net of dividend payments) weigh on the credit.
However, Moody's anticipates Zotec will be able to normalize
integration expenses and improve margins after 2022, leading to
long-term positive free cash flow and improving leverage metrics.
Zotec's approaching term loan maturity in February 2024 is a
negative credit consideration and increases refinancing risk in a
rising interest rate environment. The company is exposed to swings
in elective healthcare procedure volumes, which experienced high
volatility in 2020 due to the coronavirus pandemic.
Zotec competes in the healthcare RCM marketplace with leading
technology solutions. A relatively stable core revenue base,
afforded by exclusive contracts, as well as good profitability are
positive credit considerations. Favorable long-term dynamics in the
healthcare industry support long-term growth: increasing regulatory
and reimbursement complexity; shift to higher collections from
patients; and financial pressure on healthcare providers to cut
costs create demand for Zotec's solutions. The credit profile
includes the expectation for financial policies that will sustain
leverage below 7x.
The stable outlook reflects the expectation for long-term revenue
growth in the mid to high single-digit percentage range, following
a decline in 2022 due to the anticipated roll off of Zotec's
temporary contract with the state of Indiana. This contract boosted
revenue temporarily in 2021 by supporting the scheduling, tracking
and payment processing of the state's coronavirus-related
vaccination and testing program. Profitability is expected to
remain depressed over the next 12 months versus historical levels,
with EBITDA margins around 30% (Moody's adjusted), due to higher
than anticipated integration costs in connection with a large
contract implementation, plus the roll off of the highly profitable
contract with the state of Indiana. Moody's anticipates debt/EBITDA
(Moody's adjusted, including capitalized software costs as an
expense) will remain above 6x and free cash flow will be negative
in 2022, but credit metrics are expected to improve thereafter as
profitability recovers towards historical levels.
Zotec has adequate liquidity, supported by strong cash balances of
roughly $61 million as of March 2022 and the anticipation for
positive free cash flow after 2022. The company's large cash
balance will finance the expected free cash flow deficit in 2022
and the 1% annual term loan amortization rate. Zotec can also
manage its capitalized technology development costs to preserve
liquidity. Support from Zotec's $20 million undrawn revolving
credit facility is limited given its current maturity date in
February 2023. The approaching February 2024 maturity date of
Zotec's $315 million term loan is credit negative and could
pressure the credit if the loan becomes current. Moody's
anticipates the company will refinance the capital structure over
the next 12 months to push maturities out, but current market
conditions and rising interest rates elevate refinancing risk.
Capex related to PP&E is expected to normalize in 2022 after
elevated spend in 2021 linked to Zotec's new headquarters. Moody's
anticipates Zotec will remain in compliance with the credit
agreement covenants, including a 5.5x total net leverage ratio (per
the credit agreement definition).
The B3 rating on Zotec's senior secured credit facilities,
including the $20 million revolver maturing 2023 and the $315
million term loan maturing 2024, reflect both the B3-PD Probability
of Default rating and the Loss Given Default assessment of LGD3.
Because there is no other meaningful debt in the capital structure
to absorb potential losses, the senior secured facilities are rated
in line with the B3 corporate family rating. The rated term loan
and revolver benefit from secured guarantees of all existing and
subsequently acquired domestic subsidiaries. The credit agreement
allows for unrestricted subsidiaries to operate outside of the
restricted group, which increases the risk of asset leakage.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Moody's expects 1) sustained
revenue growth and improved profitability, with EBITDA margin
approaching 40%; 2) debt to EBITDA to remain below 5.5x; 3) free
cash flow to debt to remain above 5% (all metrics Moody's
adjusted); 4) good liquidity; and 5) balanced financial policies.
The ratings could be downgraded if 1) revenue, profits or free cash
flow do not grow as expected; 2) debt to EBITDA will be sustained
above 7.0x; 3) free cash flow to debt is expected to remain
negative; 4) Zotec's term loan becomes current; or 5) liquidity
deteriorates.
The principal methodology used in these ratings was Software
Industry published in August 2018.
Zotec Partners LLC, based in Carmel, Indiana, provides
technology-enabled revenue cycle management services and software
to the healthcare industry. Healthcare RCM is the process that
begins with scheduling a patient's appointment and ends with the
payment from the patient, insurer or government agency for the
health services provided. Zotec is owned primarily by its founder
and CEO, T. Scott Law, Sr. Over the twelve-month period ending
March 2022, Zotec generated $292 million in revenue.
ZZ HOME CARE: Files Emergency Bid to Use Cash Collateral
--------------------------------------------------------
ZZ Home Care, LLC asks the U.S. Bankruptcy Court for the Middle
District of North Carolina, Greensboro Division, for authority to
use cash collateral and provide adequate protection.
The Debtor seeks authority to use cash collateral through and
including (i) the effective date of a confirmed plan of
reorganization, (ii) a sale of substantially all assets of the
estate, or (iii) the conversion of the case to Chapter 7, whichever
may first occur; provided, however, without further notice and
hearing the Debtor may not use cash collateral for any purpose
other than (i) operations in the ordinary course of business, (ii)
adequate protection payments to the SBA, (iii) monthly payments on
executory contracts or leases, or (iv) payment of allowed
administrative fees, costs, or expenses.
The Debtor is dependent upon use of the cash collateral to pay
on-going costs of operating the business and insuring, preserving,
repairing, and protecting all its tangible assets, and thus has an
immediate need for the use of cash collateral.
The bankruptcy case was necessitated primarily due to historical
obligations and a temporary slowdown in business during the COVID
pandemic. There are several secured creditors in the case that
secure the real and personal property assets. The Debtor commenced
Chapter 11 proceedings to have an orderly liquidation and winddown
of its operations, including a sale of its franchise and transition
of current employees and patients.
In July 2020, the Debtor obtained an EIDL loan with the U.S. Small
Business Administration in excess of $150,000. As security for the
Loan, the Debtor executed a promissory note in favor of the SBA
covering all of the Debtor's tangible and intangible personal
property, including without limitation inventory, equipment,
instruments, chattel paper, documents, accounts, deposit accounts,
general intangibles and proceeds and products thereof.
The SBA filed a UCC-1 covering the SBA Collateral with the North
Carolina Secretary of State on July 7, 2020, bearing file number
20200100508K.
As of the Petition Date, the aggregate amount outstanding to the
SBA on the Loan is approximately $149,900.
On February 15, 2017, the Debtor and co-borrower Zurilla
Properties, LLC obtained a loan from American National Bank in the
amount of $1,309,000. As security for the ANB Loan, the Debtor
executed a Commercial Security Agreement in favor of ANB covering,
among other things, all of the Debtor's inventory. As of the
Petition Date, the aggregate amount outstanding to ANB on the ANB
Loan is approximately $760,000. The Debtor intends to treat the ANB
Claim as unsecured with respect to the ANB Collateral, other than
titled vehicles.
On February 16, 2017, the Debtor obtained a loan from Moorecare,
L.L.C. in the amount of $182,000. As security for the Moorecare
Loan, the Debtor executed a Security Agreement in favor of
Moorecare covering all of the Debtor's tangible and intangible
personal property. Moorecare filed a UCC-1 with the North Carolina
Secretary of State on February 27, 2017 bearing file number
20170019419F.
As of the Petition Date, the aggregate amount outstanding to
Moorecare is approximately $143,070. The Debtor intends to treat
the Moorecare Claim as unsecured.
The Debtor offers to provide the SBA with adequate protection for
the use of its cash collateral by:
a. Limiting the use of cash collateral as generally projected
in the proposed budget and as set forth in the proposed Interim
Order, or as may otherwise be approved by the Court after further
notice and hearing.
b. Providing the SBA with a continuing post-petition lien and
security interest in all property and categories of property of the
Debtor in which and of the same priority as the SBA held a similar,
unavoidable lien as of the Petition Date, and the proceeds thereof,
whether acquired pre-petition or post-petition, equivalent to a
lien granted under sections 364(c)(2) and (3) of the Bankruptcy
Code, but only to the extent of any diminution in the value of the
SBA Collateral from and after the Petition Date. The validity,
enforceability, and perfection of the aforesaid post-petition liens
on the Post-petition Collateral will not depend upon filing,
recordation, or any other act required under applicable state or
federal law, rule, or regulation.
c. To the extent that the protections described above fail to
adequately protect the SBA's interest in the cash collateral,
providing the SBA an allowed priority claim under Section 507(b) of
the Bankruptcy Code to the extent of any diminution in value of the
cash collateral from and after the Petition Date.
d. Providing to the SBA, the Bankruptcy Administrator (i)
evidence of adequate insurance in effect with respect to all
insurable property of the estate, and (ii) budget to actual reports
on a monthly basis by the 20th day of the following month, with the
first such report due by June 20, 2022, and (iii) such other
financial reports as may be reasonably requested from the Debtor by
such parties.
A copy of the motion and the Debtor's June 2022 budget is available
at https://bit.ly/3M1fqPC from PacerMonitor.com.
The Debtor projects $59,000 in sales and $58,731 in total expenses
for the month.
About ZZ Home Care, LLC
ZZ Home Care, LLC owns a home health care business based in
Burlington, North Carolina with a satellite office in Asheville,
North Carolina. ZZ Home Care sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. M.D.N.C. Case No. 22-10281) on May
31, 2022. In the petition signed by Michael Zurilla, member
manager, the Debtor disclosed up to $500,000 in assets and up to
$10 million in liabilities.
Rebecca F. Redwine, Esq., at Hendren, Redwine & Malone, PLLC is the
Debtor's counsel.
[^] BOND PRICING: For the Week from May 30 to June 3, 2022
----------------------------------------------------------
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KeyBank NA/Cleveland OH KEY 2.400 99.793 06/09/2022
Lannett Co Inc LCI 4.500 26.915 10/01/2026
MAI Holdings Inc MAIHLD 9.500 29.925 06/01/2023
MAI Holdings Inc MAIHLD 9.500 29.925 06/01/2023
MAI Holdings Inc MAIHLD 9.500 29.925 06/01/2023
MBIA Insurance Corp MBI 12.304 11.797 1/15/2033
MBIA Insurance Corp MBI 12.304 11.797 1/15/2033
Macquarie Infrastructure
Holdings LLC MIC 2.000 95.480 10/01/2023
Macy's Retail Holdings M 6.700 99.500 7/15/2034
Macy's Retail Holdings M 6.700 99.285 7/15/2034
Macy's Retail Holdings M 6.700 99.285 7/15/2034
Morgan Stanley MS 1.800 79.336 8/27/2036
Nine Energy Service Inc NINE 8.750 62.734 11/01/2023
Nine Energy Service Inc NINE 8.750 62.476 11/01/2023
Nine Energy Service Inc NINE 8.750 62.306 11/01/2023
OMX Timber Finance
Investments II LLC OMX 5.540 0.783 1/29/2020
Plains All American
Pipeline LP PAA 6.125 78.000 N/A
Renco Metals Inc RENCO 11.500 24.875 07/01/2003
Renewable Energy Group REGI 5.875 106.392 06/01/2028
Revlon Consumer Products REV 6.250 23.182 08/01/2024
Sears Holdings Corp SHLD 8.000 2.050 12/15/2019
Sears Holdings Corp SHLD 6.625 1.775 10/15/2018
Sears Holdings Corp SHLD 6.625 1.882 10/15/2018
Sears Roebuck Acceptance SHLD 7.000 1.124 06/01/2032
Sears Roebuck Acceptance SHLD 7.500 0.913 10/15/2027
Sears Roebuck Acceptance SHLD 6.500 0.808 12/01/2028
Sears Roebuck Acceptance SHLD 6.750 0.545 1/15/2028
TPC Group Inc TPCG 10.500 50.708 08/01/2024
TPC Group Inc TPCG 10.500 50.125 08/01/2024
TS Contrarian Bancshares TSCONT 7.400 91.453 06/01/2027
TS Contrarian Bancshares TSCONT 7.400 91.453 06/01/2027
Talen Energy Supply LLC TLN 9.500 61.000 7/15/2022
Talen Energy Supply LLC TLN 9.500 47.000 7/15/2022
Talen Energy Supply LLC TLN 6.500 52.500 9/15/2024
Talen Energy Supply LLC TLN 6.500 52.079 9/15/2024
TerraVia Holdings Inc TVIA 5.000 4.644 10/01/2019
Wayfair Inc W 0.375 98.150 09/01/2022
Wells Fargo & Co WFC 1.564 99.250 06/10/2022
Wesco Aircraft Holdings WAIR 8.500 52.633 11/15/2024
Wesco Aircraft Holdings WAIR 13.125 36.399 11/15/2027
Wesco Aircraft Holdings WAIR 8.500 53.533 11/15/2024
fuboTV Inc FUBO 3.250 32.500 2/15/2026
*********
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
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000.
*** End of Transmission ***