/raid1/www/Hosts/bankrupt/TCR_Public/220608.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, June 8, 2022, Vol. 26, No. 158
Headlines
121 SOURCING: Plan of Reorganization Confirmed by Judge
141 TROUTMAN: Unsecureds Owed $92K to Get $25K in Plan
1933 ASSOCIATES: Unsecureds Owed $10K to be Paid in Full in Plan
2123 PARTNERS: Unsecureds Owed $11K to be Paid in Full in Plan
27646 TG: Troublesome Creek Property Confirms Plan
5 STAR JETS: Unsecured Creditors Will Get 8.39% Dividend in Plan
65 TEAM LLC: Files Chapter 11 Petition Pro Se
7910 MAIN STREET: Files for Chapter 11 Bankruptcy
AFAB SOLUTIONS: Unsecureds Will be Paid in Full in Plan
AFFINITY KITH: Rental Income to Fund Plan Payments
AMERICAN ROCK: S&P Alters Outlook to Negative, Affirms 'B' ICR
AMMON ANALYTICAL: Case Summary & 20 Largest Unsecured Creditors
APEX CONVEYOR: Case Summary & 16 Unsecured Creditors
ARCHDIOCESE OF ST. JOHN'S: RCECSJ Converted to CCAA Case
ARMSTRONG FLOORING: Seeks to Hire Riveron Management, Appoint CTO
ARMSTRONG FLOORING: Seeks to Hire Skadden as Bankruptcy Counsel
ARMSTRONG FLOORING: Taps Borden Ladner Gervais as Canadian Counsel
ARMSTRONG FLOORING: Taps Chipman Brown Cicero & Cole as Co-Counsel
ARMSTRONG FLOORING: Taps Epiq as Administrative Advisor
ARMSTRONG FLOORING: Taps Friedman as Special Conflicts Counsel
ARMSTRONG FLOORING: Taps Groom Law as Employee Benefits Counsel
ARMSTRONG FLOORING: Taps Houlihan Lokey as Financial Advisor
ASPIRA WOMEN'S: Falls Short of Nasdaq Minimum Bid Price Requirement
ATLAS MIDCO: S&P Alters Outlook to Stable, Affirms 'B-' ICR
BACKYARD ACQUIRECO: S&P Places 'B' ICR on CreditWatch Positive
BACKYARD MIDCO: Moody's Puts 'B1' CFR Under Review for Upgrade
BITNILE HOLDINGS: Files Preferred Stock Certificate of Designation
BMW NATIONWIDE: Security Provider Files Subchapter V Case
BOY SCOUTS: Owns $10 Billion Worth of Land That Developers Want
BROWN BIDCO: S&P Affirms 'B+' Issuer Credit Rating, Outlook Stable
BROWNIE'S MARINE: Incurs $444K Net Loss in First Quarter
BUCKHARDT TECHNOLOGIES: Wins Cash Collateral Access Thru July 2
CARDINAL LOCAL SD: Moody's Upgrades Issuer & GOULT Ratings to Ba1
CAREERBUILDER LLC: S&P Downgrades ICR to 'CCC', Outlook Negative
CARVER BANCORP: Steven Bussey Quits as Director
CHICK LUMBER: Seeks Cash Collateral Access Thru Sept 2022
CINEMA SQUARE: Court Oks Wilmington Trust Cash Collateral Deal
CLEARWATER COLLECTION: Bid to Use Cash Collateral Denied
COGENT COMMUNICATIONS: Moody's Rates $450MM Unsecured Notes 'B3'
COGENT COMMUNICATIONS: S&P Rates New $450MM Sr. Unsec. Notes 'B'
COINBASE: CLO Says Crypto Assets Safe From Bankruptcy
COLORTEK COLLISION: Files Emergency Bid to Use Cash Collateral
CONNECT TRUCKING: Files Chapter 11 Subchapter V Case
CREATD INC: Closes $4 Million Private Placement
CURO GROUP: S&P Affirms 'B-' Issuer Credit Rating, Outlook Stable
CVENT INC: Moody's Withdraws 'B1' CFR Following Debt Repayment
CYTODYN INC: Reports Unregistered Sales of Equity Securities
CYTOSORBENTS CORP: Transfers Headquarters to Princeton, N.J.
DAYBREAK OIL: Needs More Time to File Form 10-K
DEPENDABLE MACHINE: Case Summary & Six Unsecured Creditors
DIOCESE OF CAMDEN: Unsecureds Owed $1.5M to Get 75% Dividend
DOMUS BWW: Seeks to Hire Gateley Plc as English Insolvency Counsel
DOMUS BWW: Seeks to Hire Landis Rath as Local Litigation Counsel
DOMUS BWW: Taps Perkins Coie as Special Litigation Counsel
DR. R'KIONE BRITTON: Files Subchapter V Case, Mulls 90-Month Plan
FINANCE OF AMERICA: Moody's Alters Outlook on B2 CFR to Negative
FINMARK STRATEGY: Files Chapter 11 Subchapter V Case
FIRSTLIGHT HOLDCO: S&P Affirms 'B-' Rating on First-Lien Debt
FREDDIE MAC: Single-Family Division Head Steps Down
GAMESTOP CORP: Incurs $157.9 Million Net Loss in First Quarter
GENOCEA BIOSCIENCES: Dr. Ali Behbahani Quits as Director
GENOCEA BIOSCIENCES: Voluntarily Withdraws Nasdaq Stock Listing
GREAT ATLANTIC: Taps Griffin Hamersky as Special Counsel
GREENWAY HEALTH: S&P Alters Outlook to Negative, Affirms 'B-' ICR
GROM SOCIAL: Falls Short of Nasdaq Minimum Bid Price Requirement
GRUBHUB INC: S&P Downgrades ICR to 'CCC+', Outlook Developing
GT REAL ESTATE: $20MM DIP Loan from DT Sports Has Interim OK
H & H INVESTMENTS: Hits Chapter 11 Bankruptcy Protection
HOFFMASTER GROUP: S&P Downgrades ICR to 'CCC' on Refinancing Risk
HORSE CARRIAGE: Files for Chapter 11 Pro Se, UST Seeks Dismissal
IBEC LANGUAGE: Unsecureds to Recover 10% via Quarterly Payments
IMERYS TALC: Fineman, et al. Update on Talc Injury PI Claimants
INNOVATIVE BUILDING: Wins Cash Collateral Access Thru July 31
IRONSTONE PROPERTIES: Board OKs Conversion of CEO Debt Into Equity
IVEDIX INC: Wins Cash Collateral Access Thru Sept 30
J AND M SUPPLY: Gets Court Nod to Use Cash Collateral
JASPER PELLETS: Files for Chapter 11 to Stop USB Takeover
JOG'S LLC: Files Chapter 11 Subchapter V Case
JOHNSON & JOHNSON CONSTRUCTION: Files Chapter 11 Subchapter V Case
JONES SODA: Signs Employment Contract With CEO
JOYFUL CARE: Seeks Court Nod on Cash Deal with SBA
KENAN ADVANTAGE: Moody's Alters Outlook on 'B3' CFR to Positive
KNOW LABS: Expands Leadership Team, Adds Two Senior Execs
KOFAX PARENT: S&P Alters Outlook to Negative, Affirms 'B' ICR
KOPIN CORP: All Four Proposals Passed at Annual Meeting
LCN PARTNERS: Seeks to Hire Verna & Associates as Accountant
LEXARIA BIOSCIENCE: All Four Proposals Passed at Annual Meeting
MERLIN ACQUISITION: Frontmatec Deal No Impact on Moody's B3 CFR
MICROSTRATEGY INC: Stockholders Elect Five Directors
NANO MAGIC: Sells Majority Interest in Applied Nanotech
NB HOTELS: Court OKs Deal on Cash Collateral Access
NEXTPLAY TECHNOLOGIES: Business Combinations Delay Form 10-K Filing
NORTHERN ENERGY: Seeks Cash Collateral Access
NRP LEASE: Unsecured Creditors to Split $600K in Plan
NUTRIBAND INC: Incurs $690K Net Loss in First Quarter
OAKVIEW FARMS: Voluntary Chapter 11 Case Summary
OREGON TOOL: Moody's Cuts CFR to B3 & Alters Outlook to Negative
PARKERVISION INC: To Sell $760K Unsecured Promissory Notes
PREMIER MODERN: Case Summary & Nine Unsecured Creditors
PROJECT LEOPARD: Moody's Assigns B3 CFR & Rates First Lien Debt B2
QHC FACILITIES: Resident-Care Issues Scuttle Nursing Home Sale
QUALITAT DRYWALL: Drywall Contractor Files Subchapter V Case
RALSTON-LIPPINCOTT: Seeks Cash Collateral Access
RCO INC: Files Emergency Bid to Use Cash Collateral
REAL GRANITE: Unsecured Creditors to Split $250K in 3 Years
RED RIVER: July 1 Hearing on Disclosure Statement
REDWOOD EMPIRE: Wins Cash Collateral Access Thru July 31
REGIONAL HEALTH: Adjourns Special Meeting Until July 25
REGIONAL HEALTH: Receives Noncompliance Notice From NYSE
REGIONAL HEALTH: Reports $2.9 Million Net Loss for First Quarter
RELMADA THERAPEUTICS: All Four Proposals Passed at Annual Meeting
REVLON INC: Starts Talks With Lenders Prior to Debt Deadlines
ROCKALL ENERGY: Committee Taps Mani Little as Special Counsel
RUBY PIPELINE: Committee Taps Benesch as Delaware Counsel
RUBY PIPELINE: Committee Taps Brown Rudnick as Legal Counsel
SABRE HOLDINGS: Moody's Affirms Ba3 CFR & Alters Outlook to Stable
SAVVA'S RESTAURANT: Taps Maltz Auctions as Real Estate Broker
TD HOLDINGS: Inks Deal to Sell $11.4 Million Worth of Common Shares
THERMA BUILDERS: July 27 Plan Confirmation Hearing Set
THOMASBORO LANDCO: Court Approves Amended Disclosure Statement
TPC GROUP: Bankruptcy Filing Reveals Need for More Safeguards
TPC GROUP: Moody's Lowers CFR to 'C' Following Bankruptcy Filing
TRIPLET LLC: Unsecured Creditors Will Get 15% of Claims in 5 Years
TWO'S COMPANY: Unsecureds to Get 12 Cents on Dollar in Plan
UBER TECHNOLOGIES: S&P Alters Outlook to Positive, Affirms 'B' ICR
VAL PROPERTIES: WesBanco Bank Says Disclosures Insufficient
VBI VACCINES: Gets UK MHRA Marketing Authorization for PreHevbri
VIDEO DISPLAY: Incurs $2.6 Million Net Loss in FY Ended Feb. 28
VISION ADELANTE: Has Deal with Coastal Capital on Collateral Access
VOIP-PAL.COM INC: Issues 475K Preferred Shares to CEO Malak
VTV THERAPEUTICS: Inks Collaboration and License Deal With G42
WEBER INC: S&P Downgrades ICR to 'B', Outlook Negative
WISECARE LLC: Wins Cash Collateral Access Thru Aug 1
WOLVERINE WORLD: Moody's Affirms Ba1 CFR & Alters Outlook to Neg.
YUNHONG CTI: Falls Short of Nasdaq Minimum Bid Price Requirement
*********
121 SOURCING: Plan of Reorganization Confirmed by Judge
-------------------------------------------------------
Judge Natalie M. Cox has entered findings of fact, conclusions of
law and order approving Second Disclosure Statement and confirming
Second Plan of Reorganization of 121 Sourcing & Supply LLC.
Article 7 of the Plan and various other provisions of the Plan
specifically provide, in sufficient detail, adequate and proper
means for the implementation of the Plan, including among (i)
providing the Reorganized Debtor with the amount of Cash required
for a reserve fund for future tax and maintenance contingencies,
(ii) paying administrative claims, (iii) the vesting of all of the
property of the Estate with the Reorganized Debtor; (vi) the
preservation and retention of Causes of Action by the Reorganized
Debtor. As a result thereof, the requirements of section 1123(a)(5)
of the Bankruptcy Code have been satisfied.
Article 4 of the Plan provides adequate means for the Plan's
implementation, including the sale of property of the estate as
suggested by 11 U.S.C. § 1123(a)(5)(D) as long as the Class 1
claim, Class 3, and Class 5 are paid in accordance with the
respective Stipulations. In this case, satisfies the requirement of
11 US.C. § 1123(a)(5).
The proposal of the Plan is consistent with the objectives and
purposes of the Bankruptcy Code and was made with honesty and good
intentions and with a basis for expecting that, under the
circumstances, it was the best means for maximizing any recovery by
creditors of the Debtor. Therefore, the Plan has been proposed in
good faith, not by any means forbidden by law, and complies with
section 1129(a)(3).
The Plan provides for the most efficient and economical means of
distributions of the DIP loan proceeds and the future sale proceeds
of the debtor's property. Conversion of this chapter 11 case to a
chapter 7 liquidation case would result in additional delay and
expense and would reopen the bar date for filing claims. This would
diminish the value of the Estate and make zero Proceeds available
for distribution to other creditors. Accordingly, under the Plan,
any recovery by creditors will exceed that which would occur in a
chapter 7 liquidation. Therefore, the Plan satisfies the best
interest of creditors test of 11 U.S.C. § 1129(a)(7).
A full-text copy of the Confirmation Order dated June 02, 2022, is
available at https://bit.ly/3GSfNuI from PacerMonitor.com at no
charge.
Attorney for Debtor:
Steven L. Yarmy, Esq.
7464 W Sahara Ave, Suite 8
Las Vegas, Nevada 89117
Tel: (702) 586-3513
Fax: (702) 586-3690
E-mail: sly@stevenyarmylaw.com
About 121 Sourcing & Supply
Based in Las Vegas, Nevada, 121 Sourcing & Supply LLC filed a
voluntary petition under Chapter 11 of Title 11, United States Code
(Bankr. D. Nev. Case No. 18-17558) on Dec. 27, 2018, estimating
under $1 million in both assets and liabilities. Steven L. Yarmy
is the Debtor's counsel.
141 TROUTMAN: Unsecureds Owed $92K to Get $25K in Plan
------------------------------------------------------
141 Troutman LLC, 243 Suydam LLC, and Union Residence LLC submitted
a Disclosure Statement explaining their Chapter 11 Plan.
As emphasized throughout the Plan, the Debtors' preferred treatment
of its secured mortgage debt is the reinstatement thereof based
upon a total proposed cure payment of $1,147,837 plus reasonable
attorney's fees. The cure of the mortgage debt will enable the
Debtors to maintain ownership of their respective walk-up
residential buildings located at 141 Troutman Street, 243 Suydam
Street and 555-557 Union Street (each a "Property"). The
Properties collectively house one to two bedroom residential
apartments, most of which are currently occupied as provided on the
attached rent rolls which can be found at https://bit.ly/3me7nEy
The mortgage debt of approximately $14 million of principal (which
covers all of the Properties under a spreader agreement) (the
"Mortgage") is currently held by Wells Fargo Bank, National
Association, as trustee for the Registered Holders of CSAIL
2019-C15 Commercial Mortgage Trust, Commercial Mortgage
Pass-Through Certificates, Series 2019-C15 (the "Secured
Creditor"). The Mortgage went into default as result of the
Covid-19 pandemic, which triggered a drop in rental income by
roughly 50%. Pre-Covid, the Debtors were current with the Mortgage,
but collections dropped to approximately $50,000 per month during
Covid. For much of 2020 and into 2021, the Debtors paid net cash
flow to the Secured Creditor under various informal forbearance
arrangements in contemplation of receiving a new restructured
mortgage. Negotiations, however, came to an impasse and the net
cash flow payments ended as of November 2021.
Since the Properties appear to be undersecured, the Secured
Creditor is not entitled to post-petition default interest under 11
U.S.C. Section 506(a). The Plan recognizes that default interest
began to accrue prepetition when net cash flow payments stopped.
However, it is the Debtors' position that prepetition default
interest is not properly owed from July 6, 2020 through Oct. 31,
2021 when net cash flow payments were being made to the Secured
Creditor.
Besides payment of certain default interest, to augment the
proposed cure and reinstatement, the Debtors' Principals have
committed to make a principal pay-down of $1.5 million to reduce
the outstanding principal debt to approximately $12.5 million.
While there is no legal obligation under 11 U.S.C. Section 1124 for
a principal pay-down, the fact that the principal debt is being
reduced accomplishes 2 purposes. First, the infusion of capital
reconfirms the Principals' commitment to maintain ownership of the
Properties and addresses any new value issues that could possibly
arise. Second, the reduction of the principal debt helps to
alleviate any feasibility issues that may be lodged by the Secured
Creditor regarding the Debtors' ability to service the reinstated
debt in the future.
While the Debtors believe that the proposed principal pay-down of
$1.5 million is beneficial to the overall interests of the Secured
Creditor and should be welcome news, nevertheless, to the extent
that the Secured Creditor alleges that the pay-down is not
permitted without a defeasance penalty, then the Debtors reserve
the right to reallocate the pay-down as a potential reserve in
whole or in part. In the Debtors' view, the principal pay-down is a
very positive aspect of the Plan (particularly in the face of
rising market interest rates), but the Debtors have no intention of
opening the door to potential additional claims and costs for
defeasement and will proceed with the pay-down only with the
consent of the Secured Creditor. Again, the Debtors are not
obligated to make a principal pay-down under 11 U.S.C. Section 1124
and are prepared to do so on a voluntary basis in an effort to
facilitate better relations with the Secured Creditor. Hopefully,
this goal can be accomplished on a consensual basis.
As a back-up, the Debtors are also proposing a "toggle" under the
Plan, whereby the Debtors will proceed with a sale of the
Properties in the event that the Debtors' preferred treatment of
cure and reinstatement is not permitted. Should that occur, the
Debtors will then pursue a sale of the Properties under a
conventional auction sale format (the "Auction"), free and clear of
all liens, claims and adverse interests pursuant to 11 U.S.C.
Section 363(b) and (f). As necessary, the Auction shall be
conducted pursuant to a separate bidding procedure motion, which
will take into account all of the intricacies in selling multiple
buildings.
Regardless of which treatment is ultimately employed relating to
the Secured Creditor, the Plan provides for payment of allowed
Administrative Claims and Priority Claims, plus a pro rata
distribution to each holder of an allowed non-insider general
unsecured claim from the General Unsecured Creditor Fund.
Under the Plan, Class 3 Unsecured Claims total $92,000. Each
holder of an Allowed Class 3 Unsecured Claim will receive a pro
rata dividend of approximately 50% from the General Unsecured
Creditor Fund in full and final satisfaction of such holder's
allowed Unsecured Claim. Class 3 is impaired.
The Plan will be funded through the New Value Contributions of the
Debtors' Principals to be deposited into escrow with the Disbursing
Agent at least 1 day prior to the start of the Confirmation
Hearing. The New Value Contribution shall be used to fund payments
due under the Plan itemized as follows:
a. Administrative Expense Claims $150,000
b. Priority Claims $2,217
c. Cure to Secured Creditor $1,147,837
d. General Unsecured Creditor Fund $50,000
e. Principal Pay-Down $1,500,000
f. Miscellaneous $150,000
----------
Total $3,000,054
Attorneys for the Debtors:
Kevin J. Nash, Esq.
GOLDBERG WEPRIN FINKEL GOLDSTEIN LLP
1501 Broadway, 22nd Floor
New York, NY 10036 By
A copy of the Disclosure Statement dated June 3, 2022, is available
at https://bit.ly/3Q11ZSX from PacerMonitor.com.
About 141 Troutman, et al.
141 Troutman, LLC, 243 Suydam, LLC, and Union Residence, LLC, are
owners of residential buildings in Brooklyn, New York,
141 Troutman filed a petition for Chapter 11 protection (Bankr.
E.D.N.Y. Lead Case No. 22-40337) on Feb. 24, 2022, listing
$2,372,944 in total assets and $14,537,068 in total liabilities.
243 Suydam filed for Chapter 11 protection (Bankr. E.D.N.Y. Case
No. 22-40339) on Feb. 24, 2022, listing $4,605,790 in total assets
and $14,675,136 in total liabilities.
Union Residence filed for Chapter 11 protection (Bankr. E.D.N.Y.
Case No. 22-40342) on Feb. 24, 2022, listing $6,758,667 in assets
and $14,536,870 in liabilities.
The Debtors' cases are jointly administered.
Chaim Lefkowitz, manager, signed the petitions.
Judge Nancy Hershey Lord oversees the cases.
Goldberg Weprin Finkel Goldstein, LLP, serves as the Debtors' legal
counsel.
1933 ASSOCIATES: Unsecureds Owed $10K to be Paid in Full in Plan
----------------------------------------------------------------
1933 Associates, LP, submitted an Amended Plan of Reorganization.
Under the Plan, Class 3 shall consist of creditors holding
unsecured claims to the extent that such claims are allowed by the
Court. The Internal Revenue Service filed a general unsecured
claim in the amount of $26,578 consisting almost all in penalties,
although no tax is owed. The Debtor intends to object to this
claim. City of Philadelphia/School District of Philadelphia filed
a general unsecured claim in the amount of $4,211. The Debtor
scheduled 11 general unsecured claims of tenants for security
deposits, Philadelphia Electric Company for electric services, and
Philadelphia Gas Works for gas services. One former tenant filed a
claim, Nicole Groff in the amount of $1,900. Those claims total
$10,471. All allowed Class 3 claims will be paid in full on the
Effective Date, or if the Debtor objects to any Class 3 claim, the
day of a final order allowing the claim. This class is unimpaired
and is not entitled to vote for or against the Plan.
The proceeds necessary for the satisfaction of Claims will come
from a Plan Contribution in the Debtor by Myron Berman estimated to
be $700,000 if the Debtor reinstates the mortgage or a payment of
cash to create sufficient equity in the 1933 Property and the 1919
Property to allow the Debtor to refinance the properties to pay
Sterling's allowed claim in full, as well as all the other allowed
claims. As set forth in detail in the Debtor's Disclosure
Statement, Myron Berman has a net worth in excess of $15 million
and is in contract to sell one of his real estate interests where
he will receive at least $5 million and as much as $10 million.
That money together with third party financing will be used to
reinstate the mortgage held by Sterling or be used towards paying
in full the allowed amount of Sterling's claim and to pay all the
other allowed claims against the Debtor in full. The Debtor has
obtained two letters from mortgage brokers that state that will be
able to find lenders to refinance the 1933 Property and the 1919
Property. At the hearing on confirmation, the Debtor will have a
term sheet from a lender the terms on which the lender will give
the refinancing. The Debtor shall continue in possession of all of
its property. If this Court finds that the Debtor may reinstate
the mortgage held by Sterling, all future payments to Sterling will
be paid from the rental income of the 1933 Property and the 1919
Property. The payment of the loan when due will come from a
refinance of the Property. The Debtor's attorneys shall act as
Disbursing Agent for the payment of all Claims. The Debtor will
pay all United States Trustee fees and file all operating reports
for so long as the case is open. The managing partner of the
Debtor shall continue to be Corey Berman, who does not receive a
salary from the Debtor.
A copy of the Plan dated June 3, 2022, is available at
https://bit.ly/3zcMjpM from PacerMonitor.com.
About 1933 Associates
1933 Associates LP, a company that is primarily engaged in renting
and leasing real estate properties, filed its voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y.
Case No. 21-42981) on Nov. 30, 2021, listing $3,021,000 in total
assets and $1,547,467 in total liabilities. Corey M. Berman, sole
partner, signed the petition. Judge Jil Mazer-Marino oversees the
case. Rosenberg, Musso & Weiner, LLP serves as the Debtor's
counsel.
2123 PARTNERS: Unsecureds Owed $11K to be Paid in Full in Plan
--------------------------------------------------------------
2123 Partners, LP submitted an Amended Plan of Reorganization.
Under the Plan, Class 3 shall consist of those creditors holding
Unsecured Claims to the extent that such Claims are allowed by the
Court. The Internal Revenue Service filed a general unsecured
claim in the amount of $32,787 consisting almost all in penalties,
although no tax is owed. The Debtor intends to object to this
claim. City of Philadelphia/School District of Philadelphia filed
a general unsecured claim in the amount of $2,510. The Debtor
scheduled eleven general unsecured claims of tenants for security
deposits, Philadelphia Electric Company for electric services, and
Philadelphia Gas Works for gas services. No former tenants filed
claims. Those claims total $11,322. All allowed Class 3 claims
will be paid in full on the Effective Date, or if the Debtor
objects to any Class 3 claim, the day of a final order allowing the
claim. This class is unimpaired and is not entitled to vote for or
against the Plan.
The proceeds necessary for the satisfaction of claims will come
from a Plan contribution in the Debtor by Myron Berman estimated to
be approximately $1,250,000 if the Debtor reinstates the mortgage
or a payment of cash to create sufficient equity in the 1933
Property and the 1919 Property to allow the Debtor to refinance the
properties to pay Sterling's allowed claim in full, as well as all
the other allowed claims. As set forth in detail in the Debtor's
Disclosure Statement, Myron Berman has a net worth in excess of $15
million and is in contract to sell one of his real estate interests
where he will receive at least $5 million and as much as $10
million. That money together with third party financing will be
used to reinstate the mortgage held by Sterling or be used towards
paying in full the allowed amount of Sterling's claim and to pay
all the other allowed claims against the Debtor in full. The
Debtor has obtained two letters from mortgage brokers that state
that will be able to find lenders to refinance the 2123 Property,
the 2125 Property and the 1909 Property. At the hearing on
confirmation, the Debtor will have a term sheet from a lender the
terms on which the lender will give the refinancing. The Debtor
shall continue in possession of all of its property. If this Court
finds that the Debtor may reinstate the mortgage held by Sterling,
all future payments to Sterling will be paid from the rental income
of the 2123 Property, the 2125 Property and the 1909 Property. The
payment of the loan when due will come from a refinance of the
Property. The Debtor's attorneys shall act as Disbursing Agent for
the payment of all Claims. The Debtor will pay all United States
Trustee fees and file all operating reports for so long as the case
is open. The managing partner of the Debtor shall continue to be
Corey Berman, who does not receive a salary from the Debtor.
A copy of the Plan dated June 3, 2022, is available at
https://bit.ly/3mdJgG3 from PacerMonitor.com.
About 2123 Partners
2123 Partners LP, a company that is primarily engaged in renting
and leasing real estate properties, filed its voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y.
Case No. 21-42983) on Nov. 30, 2021, listing $5,533,000 in total
assets and $3,046,630 in total liabilities. Corey M. Berman, sole
partner, signed the petition. Judge Nancy Hershey Lord oversees
the case. Rosenberg, Musso & Weiner, LLP, serves as the Debtor's
counsel.
27646 TG: Troublesome Creek Property Confirms Plan
--------------------------------------------------
Judge Joseph G. Rosania, Jr., has entered an order confirming the
Amended Plan of Reorganization of 27646 T.G., LLC.
The Plan has been accepted in writing by the creditors whose
acceptance is required by law; and alternatively the standards for
confirmation under 11 U.S.C. Section 1129(b) have been met.
As reported in the TCR, the Debtor has filed a PLan that provides
that the Debtor will satisfy the secured debt against its property
through a sale of the Property or a refinance of the debt. The
Property will be listed at a price of $738,000 which is an amount
the Debtor and Dream Maker Real Estate Ltd dba The
McWilliams Group, have agreed to based upon demand, current market
conditions and available properties in Evergreen Colorado. The
Plan provides that the Debtor will have through and including
October 31, 2022, to repay the secured debts owed to Citywide Banks
and the Jefferson County Treasurer through sale or refinance. If
the secured debts are not paid by October 31, 2022, both Citywide
Banks and the Jefferson County Treasurer are granted relief to
pursue their lien remedies through foreclosure. Harry C. Elder,
holder of 100% of the Membership Interests in the Debtor, will
retain his membership interests. There are no unsecured creditors
in the case.
A full-text copy of the Amended Disclosure Statement dated April
19, 2022, is available at https://bit.ly/3v6Tayt from
PacerMonitor.com at no charge.
About 27646 T. G.
27646 T. G., LLC, is a Colorado limited liability company which was
formed on February 12, 2014. The LLC was formed to take ownership
of the 1.8 acres of undeveloped real property located at 27646
Troublesome Gulch Road, Lot 2, Evergreen, Colorado 80439 in
Jefferson County, Colorado. The Property is located just outside
Kittredge Colorado, is approximately 2 miles northeast of Evergreen
Colorado, and has frontage on the Troublesome Creek. The sole
owner and member of the company is Harry C. Elder, also known as
Harrison Elder.
27646 T. G., LLC, filed a petition for Chapter 11 protection
(Bankr. D. Colo. Case No. 21-15421) on Oct. 27, 2021, listing as
much as $500,000 in both assets and liabilities. Judge Joseph G.
Rosania Jr. oversees the case. The Debtor tapped the Law Office of
Bonnie Bell Bond, LLC, as legal counsel.
5 STAR JETS: Unsecured Creditors Will Get 8.39% Dividend in Plan
----------------------------------------------------------------
5 Star Jets, LLC, submitted an Amended Disclosure Statement
describing Plan of Reorganization dated June 2, 2022.
The business has not been operating for several years so there are
no relevant prepetition financial records as to operating revenue
or expenses. It is anticipated the revenues will be between $5,000
and $7,500 per month with expenses approximately 1/3 of that amount
and the balance to pay executive salaries. There is insufficient
time for there to be any meaningful post petition financial records
both as to revenue and expenses.
The purpose of the Plan is to pay at confirmation, pro rata $25,000
to the unsecured creditor(s) and to pay in full all administrative
and priority creditors.
Class II consists of Allowed Unsecured Creditors of the Debtor.
Class II consists of the unsecured claims of: Aeromarsil, LLC
($40,868.92); Basketball Properties, Ltd. ($ 78,456.72); Dennis
Freeman ($2,500.00); Dumont Aircraft Charter, LLC ($24,342.10);
GLFSTRM, LLC ($12,907.50); and World Fuel Services, Inc.
($172,156.53). Claims in this Class shall be paid their pro rata
share of $25,000.00 at confirmation.
The bar date of May 23, 2022 has already passed. Based on scheduled
undisputed claims and claims filed to date, which total
$298,098.12, the dividend to unsecured creditors will be 8.39%.
Payments and distributions under the Plan will be funded by the
infusion of $25,000.00 from Ramon Salinas in exchange for which he
will be given a 50% interest in the Debtor.
The Post-Confirmation Manager of the Debtor will be Javier Salinas.
He will receive an initial salary of $3,000.00 per month presuming
funds are available to pay same. Unpaid salary will accrue and be
paid when funds are available.
A full-text copy of the Amended Disclosure Statement dated June 02,
2022, is available at https://bit.ly/3mfmMVg from PacerMonitor.com
at no charge.
Attorney for the Debtor:
Stan L. Riskin, Esq.
Advantage Law Group, P.A.
20801 Biscayne Blvd., Ste. 506
Aventura, FL 33180
Tel: 305-936-8844
Fax: 305-627-3831
Email: stan.riskin@gmail.com
About 5 Star Jets
5 Star Jets, LLC, filed a petition for Chapter 11 protection
(Bankr. S.D. Fla. Case No. 22-12009) on March 14, 2022, listing up
to $50,000 in assets and up to $500,000 in liabilities. Javier
Salinas, manager, signed the petition.
Judge Laurel M. Isicoff oversees the case.
The Debtor tapped Advantage Law Group, P.A., as legal counsel.
65 TEAM LLC: Files Chapter 11 Petition Pro Se
---------------------------------------------
65 Team LLC filed a bare-bones Chapter 11 petition in the Southern
District of Florida. The petition indicates that the Debtor is not
represented by an attorney.
Its schedules of assets and liabilities and statement of financial
affairs are due June 10, 2022.
According to court documents, 65 Team LLC estimates between 1 and
49 unsecured creditors. The petition states that funds will be
available to unsecured creditors.
About 65 Team LLC
65 Team LLC is Single Asset Real Estate (as defined in 11 U.S.C.
Sec. 101(51B)).
65 Team LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 22-14201) on May 27,
2022. In the petition filed by The Debtor reports assets and
liabilities between $500,000 and $1 million each.
The case is overseen by Honorable Bankruptcy Judge Peter D. Russin.
7910 MAIN STREET: Files for Chapter 11 Bankruptcy
-------------------------------------------------
7910 Main Street Property, LLC, filed for chapter 11 protection in
Los Angeles, California, saying that it was facing the loss of
valuable property.
According to court filing, 7910 Main Street Property estimated
assets between 1 and 49 unsecured creditors. The petition states
funds will be available to unsecured creditors.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for July 5, 2022 at 1:00 P.M.
About 7910 Main Street Property
7910 Main Street Property LLC is a Single Asset Real Estate (as
defined in 11 U.S.C. § 101(51B)).
7910 Main Street Property sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No. 22-10877) on May
27, 2022.
The case is assigned to Honorable Bankruptcy Judge Scott C
Clarkson.
Eric Bensamochan, of The Bensamochan Law Firm, Inc., is the
Debtor's counsel.
AFAB SOLUTIONS: Unsecureds Will be Paid in Full in Plan
-------------------------------------------------------
AFAB Solutions, LLC, submitted a Plan and a Disclosure Statement.
The Debtor's primary assets are its fleet of commercial trucks and
trailers. The trucks and trailers are worth approximately $32,000
and are encumbered by a purchase money loan from Arlington Auto
Sales, LLC. The Debtor does not own any real property.
The Plan proposes to pay all allowed Unsecured Creditor Claims in
full whereas should this case be converted to a case pending under
Chapter 7, the amount unsecured creditors would receive after
considering reduced auction value and deducting Chapter 7 trustee
statutory fees and estimated professional costs of disposition, is
estimated to be only $13,387.50 -- on a pro-rata basis.
Counsel for Plan Proponent:
Thomas C. Adam, Esq.
ADAM LAW GROUP, P.A.
326 N. Broad Street #208
Jacksonville, FL 32202
Tel: (904) 329-7249
Fax: (904) 615-6561
E-mail: tadam@adamlawgroup.com
A copy of the Disclosure Statement dated June 3, 2022, is available
at https://bit.ly/3Ml4oVF from PacerMonitor.com.
About Afab Solutions, LLC
Afab Solutions, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 3:22-bk-00110-JAB) on
January 18, 2022. In the petition signed by Alexis Rengel, owner,
the Debtor disclosed up to $100,000 in assets and up to $500,000 in
liabilities.
Judge Jacob Brown oversees the case.
Thomas C. Adam, Esq., at The Adam Law Group P.A., is the Debtor's
counsel.
AFFINITY KITH: Rental Income to Fund Plan Payments
--------------------------------------------------
Affinity Kith, LLC, filed with the U.S. Bankruptcy Court for the
Western District of Oklahoma a Disclosure Statement describing
Chapter 11 Plan dated June 6, 2022.
Debtor's owner, Bartley Industries, Inc. filed Chapter 11
bankruptcy on September 25, 2021, case no. 21-12565 SAH.
Subsequent events determined that this Debtor was a subsidiary of
Bartley Industries, Inc., and the exclusive owner of certain real
property which is the only asset in this case. The Plan is for the
purpose of reinstating a mortgage on the real property for the
benefit of Bartley Industries, Inc.
Class 2 consists of Secured Creditors:
* Valliance Bank No. 1, $1,288,589.11 (includes current
payment and arrearage component). Payment shall be $8,705.38
current per month principal and interest for 60 months beginning
the first day of the month following confirmation.
* Valliance Bank No. 1 arrearage component from claim totals
$73,933.63. Payment shall be $1,232.23 for 60 months equal
installments beginning the first day of the month following
confirmation.
Debtor contends there is no general unsecured debt.
The Debtor intends to make the payments required under the Plan
from the following sources:
* Available cash. Debtor receives $10,500 per month commencing
July 1, 2022, from its tenant Bartley Industries, Inc., and
projects cash will be available on the Effective Date sufficient to
pay administrative claims previously approved or allowed, and
unpaid, and UST fees, if any. Funds will be parked in the DIP
account of Bartley Industries, Inc., Case no. 21-12565 SAH, a
related case.
* Future disposable income. Debtor estimates that projected
monthly income available for the 5-year period following
confirmation will be no less than $10,500.00 per month. Debtor has
not previously maintained any cash flow operations, but solely owns
the real property herein for the purpose of collecting rent, and
passing it back to its affiliate corporation Bartley Industries,
Inc. for the purpose of paying mortgage payments (Debtor does not
have a checking account independent of Bartley Industries, Inc.
Upon written request, a statement which will, in simplicity, show
$10,500 per month rent collected, and no expenses.
The Debtor estimates that the Debtor will have sufficient cash on
hand on the Effective Date to pay all claims and expenses entitled
to be paid in cash on such date.
A full-text copy of the Disclosure Statement dated June 6, 2022, is
available at https://bit.ly/3xbKjvf from PacerMonitor.com at no
charge.
Attorney for Debtor:
B. David Sisson, Esq.
Law Offices of B. David Sisson
305 E Comanche St. /P O Box 534
Norman, OK 73070-0534
Telephone: 405.447.2521
Fax: 405.447.2552
Email sisson@sissonlawoffice.com
About White Rabbit Ventures, Inc.
White Rabbit Ventures, Inc. sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. W.D. Okla. Case No. 22-10777) on
April 21, 2022. In the petition signed by Donna J. Bartley,
president, the Debtor disclosed up to $10 million in assets and
liabilities.
The Debtor tapped the Law Offices of B. David Sisson as legal
counsel.
AMERICAN ROCK: S&P Alters Outlook to Negative, Affirms 'B' ICR
--------------------------------------------------------------
S&P Global Ratings revised its outlook to negative from stable and
affirmed its 'B' issuer credit rating on Mount Morris, N.Y.-based
salt producer American Rock Salt Co. LLC.
S&P said, "The 'B' issue level rating and associated '3' recovery
rating on the first-lien term loan and the 'CCC+' issue-level
rating and associated '6' recovery rating on the second-lien term
loan remain unchanged.
"The negative outlook reflects the potential for lower ratings
within the next 12 months if the weakness in earnings persists
without any recovery in sight such that we continue to expect that
adjusted leverage is sustained above 7x.
"We expect flat sale prices and rising production costs will lead
to a small contraction in EBITDA margins in FY2022. We expect
margins to contract in FY2022 as sales prices remain flat and
production and transportation costs increase significantly as a
result of inflationary pressures. This is partly offset by an
8%-10% increase in tons sold due to higher volume commitments from
customers. The negative impact of inflation on logistics and
transportation costs throughout the first half of FY2022 was partly
mitigated by higher locked-in pre-season prices and certain fuel
price pass-through mechanisms embedded in some of American Rock
Salt's sales contracts. However, American Rock Salt competes on
prices, and the flat selling prices seen in the first half of
FY2022 reflect its response to increasing competitive threats
within some markets, which limited its ability to increase prices
in exchange for higher tonnage. However, we expect selling prices
to improve significantly during the 2022-2023 bidding season to
reflect current market conditions. American Rock Salt's EBITDA
previously declined by about 9% in FY2021 compared to FY2020
primarily due to rising production costs due to an unfavorable
sales location mix, where a greater percentage of sales were from
remote stockpiles instead of the Hampton Corner's mine. This
contraction occurred despite marginal improvement in revenue and
lower operating expenses.
"We expect EBITDA will remain flat in FY2022, compared to FY2021,
before potentially improving by 12%-15% in FY2023. Consequently, we
expect adjusted leverage will remain in the 8x-9x range in FY2022
underpinned by the lower earnings before recovering to the 7x-8x
range or better. American Rock Salt's S&P Global Ratings' adjusted
leverage spiked to 8.4x in FY2021, compared to our prior
expectation of about 6.5x. This was driven by a combination of
weaker-than-expected earnings and increased debt load following a
debt-financed distribution of $235 million to its sole shareholder
in 2021.
"We expect American Rock Salt's free operating cash flow (FOCF)
will remain positive, supported by the nondiscretionary nature of
de-icing salt and the mine's low maintenance capital requirements.
We project FOCF will decline but remain positive in FY2022 due to
increasing capital expenditure. American Rock Salt plans to invest
in new equipment and various expansion projects over the next 12-24
months that will improve mining operations, capacity, and reduce
costs. The nondiscretionary nature of highway de-icing salt ensures
constant demand for the product though volumes may fluctuate
depending on the frequency of snowfall. We also expect the company
will maintain sufficient liquidity to meet its current obligations,
supported by high levels of cash on the balance sheet ($43 million)
and availability under its undrawn $70 million revolving credit
facility as of March 31, 2022. We also expect EBITDA interest
coverage ratio just below 2x in FY2022 but will improve to 2.2x in
FY2023 along with our assumption of a partial recovery of EBITDA.
"The negative outlook reflects the potential for a lower rating
within the next 12 months if the weakness in earnings persists with
no recovery in sight such that adjusted leverage is sustained above
7x."
Such weakness in earnings could persist if:
-- Aggressive competitive threats continue to limit American Rock
Salt's ability to get favorable pricing to combat rising
transportation and production costs; and/or
-- Milder winter weather results in volumes below our base case
assumption.
S&P said, "We could lower our ratings on American Rock Salt if
adjusted leverage is sustained above 7x and/or EBITDA interest
coverage is sustained below 2x due to a protracted period of
earnings weakness. This could occur if there is weakness in demand,
loss of market share, unfavorable pricing, and/or higher production
and transportation costs.
"We could revise our outlook on American Rock Salt to stable if it
sustains adjusted leverage below 7x. This could occur following a
recovery in earnings due to favorable selling prices during the
2022-2023 bidding season and/or a reduction in its debt."
ESG credit indicators: E-3 S-2 G-3
S&P said, "Environmental factors are a moderately negative
consideration in our credit analysis of American Rock Salt (ARS)
Co. LLC. ARS operates a single mine, which makes it susceptible to
physical risks such as earthquakes disrupting operations.
Furthermore, salt mining involves considerable energy intensity and
GHG emissions. However, we consider salt mining less harmful to the
environment than coal and other forms of mining and, as such,
subject to less stringent environmental laws and regulations. Salt
also has no known long-term health risk associated with its
extraction. Governance factors are a moderately negative
consideration due to the considerable overlap of the board of
directors and management, which compromises management's
independence."
AMMON ANALYTICAL: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Ammon Analytical Laboratories, LLC
35 East Blancke Street
Linden, NJ 07036
Business Description: Ammon Analytical offers clinical laboratory
services.
Chapter 11 Petition Date: June 7, 2022
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 22-14534
Judge: Hon. Stacey L. Meisel
Debtor's Counsel: Erin J. Kennedy, Esq.
FORMAN HOLT
365 Passaic Street, Suite 400
Rochelle Park, NJ 07662
Tel: (201) 845-1000
Email: mholt@formanlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Stephen Haupt as managing member and
CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/TQNUPAY/Ammon_Analytical_Laboratories__njbke-22-14534__0001.0.pdf?mcid=tGE4TAMA
APEX CONVEYOR: Case Summary & 16 Unsecured Creditors
----------------------------------------------------
Debtor: Apex Conveyor Systems, Inc.
27455 Bostik Court
Ternecula, CA 92590
Business Description: The Debtor is part of the miscellaneous
manufacturing industry.
Chapter 11 Petition Date: June 6, 2022
Court: United States Bankruptcy Court
Central District of California
Case No.: 22-12152
Judge: Hon. Magdalena Reyes Bordeaux
Debtor's Counsel: Robert B. Rosenstein, Esq.
ROSENSTEIN & ASSOCIATES
28600 Mercedes Street
Suite 100
Temecula, CA 92590
Tel: 951-296-3888
E-mail: robert@thetemeculalawfirm.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Greg S. King as president.
A copy of the Debtor's list of 16 unsecured creditors is available
for free at PacerMonitor.com at:
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/QVCVAAY/APEX_CONVEYOR_SYSTEMS_INC__cacbke-22-12152__0001.0.pdf?mcid=tGE4TAMA
ARCHDIOCESE OF ST. JOHN'S: RCECSJ Converted to CCAA Case
--------------------------------------------------------
The Supreme Court of Newfoundland and Labrador ordered and declared
that the Roman Catholic Episcopal Corporation of St. John's
("Company") is a company to which the Companies' Creditors
Arrangement Act applies. The Court authorized the Company to file
a plan of compromise and arrangement.
On March 16, 2018, the Court rendered a judgment in John Doe
(G.E.B. 25) v. The Roman Catholic Episcopal Corporation of St.
John's involving claims by four plaintiffs for abuse by Christian
Brothers during their childhood while living at Mount Cashel
Orphanage in the late 1940's and 1950's. The Court found no basis
for liability against the RCECSJ and dismissed the claims. The
Court went on to provide an assessment of damages that would have
been due to the four plaintiffs and assessed damages in the total
amount of C$2,611,114.
On July 28, 2020, the Newfoundland and Labrador Court of Appeals
overturned the trial court decision and held that RCECSJ was
vicariously liable for the sexual abuse perpetrated by Christian
Brothers at the Mount Cashel orphanage. The Court of Appeal also
modified the pre-judgment interest award.
On April 15, 2021, the four plaintiffs involved in the Mount of
Cashel Action filed a judgement at the Sheriff's Office totaling
$2,395,312.
Since the filing of the Judgment, the RCECSJ has received claims
from four separate solicitors based in St. John's, NL who advise
that they collectively represent in excess of 100 men who intend to
file claims against the RCECSJ and that these claims are expected
to exceed $50 million.
On Dec. 21, 2021, the RCECSJ filed a notice of intention to make a
proposal pursuant to Sec. 50.4(1) of the Bankruptcy and Insolvency
Act, RSC, 1985, c B-3 ("NOI Proceedings"). Ernst & Young Inc. was
appointed as proposal trustee in the NOI proceedings.
The NOI proceedings was converted to a stay of proceedings under
the CCAA pursuant to an order of the Court dated May 11, 2022, and
effective May 17, 20222. Ernst & Young Inc. was appointed as the
monitor of the RCECSJ.
E&Y can be reached at:
Ernst & Young Inc.
Attn: George Kinsman
RBC Waterside Centre
1871 Hollis Street, Suite 500
Halifax, NS B3J 0C3
Fax: (902) 420-0503
Tel: (902) 421-6282
Email: george.c.kinsman@parthenon.ey.com
CCAA proceedings is available on the Monitor's website at
http://www.ey.com/ca/rcecsj
About RCECSJ
Roman Catholic Episcopal Corporation of St. John --
https://rcsj.org/ -- is located at Pastoral Centre, 200 Military
Road, St. Johns', NL A1C 2E8. The RCECSJ is a body corporate duly
incorporated under the laws of the Province of Newfoundland and
Labrador in Canada for the purpose of holding lands and property of
the Roman Catholic Archdiocese of St. Johns. The RCECSJ holds all
of the property of 34 parishes within the Archdiocese of St.
Johns.
The RCECSJ is a not-for-profit charitable organization which
depends on donations and assistance from supporters of the Roman
Catholic faith to assist it in meeting its ongoing operating cash
requirements.
ARMSTRONG FLOORING: Seeks to Hire Riveron Management, Appoint CTO
-----------------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Riveron
Management Services, LLC to provide interim management services and
appoint Dalton Edgecomb, the firm's senior managing director, as
their chief transformation officer.
The firm's services include:
(a) assisting the Debtors and their investment banker in the
Debtors' ongoing asset sale process;
(b) providing additional temporary staff to assist with
financial and business plan projections;
(c) preparing data and analyses necessary to meet the
requirements and requests of management related to the Debtors'
restructuring;
(d) supervising the preparation of, reviewing, evaluating, and
revising the Debtors' 13-week cash flow budget and borrowing base
projection;
(e) assisting the Debtors with reporting requirements relative
to financial covenants set forth in the December 2021 Credit
Agreements;
(f) assisting the Debtors with working capital and
profit-enhancement initiatives;
(g) assisting the Debtors in managing the Debtors' cash and
ensuring compliance with the Debtors' credit agreements;
(h) assisting the Debtors and other advisors in communications
with key constituents;
(i) evaluating the short-term cash flows and financing
requirements of the Debtors;
(j) assisting the Debtors in managing their day-to-day
business activities, including disbursements, sales, personnel, and
other operational matters;
(k) assisting in obtaining court approval for use of cash
collateral or other financing;
(l) assisting in compiling and formatting data and analyses
necessary to meet the financial reporting requirements mandated by
the Bankruptcy Code and the Office of the U.S. Trustee;
(m) preparing analyses and data required under the Debtors'
financing documents;
(n) assisting the Debtors with respect to analyses and
reconciliation of claims against the Debtors and bankruptcy
avoidance actions;
(o) assisting the Debtors and their counsel in the preparation
for court hearings, the argument of motions, complaints and
objections to be filed by the Debtors, and providing expert
testimony;
(p) assisting the Debtors in the preparation of analyses in
support of, and preparation of, a plan of reorganization and
disclosure statement;
(q) assisting the Debtors with communications and negotiations
with other constituents critical to the successful execution of the
bankruptcy proceedings;
(r) assisting the Debtors to assess any offers made pursuant
to bankruptcy court-approved sale procedures.
The hourly rates charged by the firm for its services are as
follows:
Chief Transformation Officer $815
Senior Managing Director $815 - $1420
Managing Director / ED $650 - $960
Directors $520 - $920
Senior Associate / Analyst $505 - $650
Paraprofessional $200
As disclosed in court filings, Riveron Management does not hold an
interest adverse to the Debtors' estates.
The firm can be reached through:
Dalton Edgecomb
Riveron Management Services, LLC
461 Fifth Avenue, 12th Floor
New York, NY 10017
Tel: 646-585-9050/203.253.1862
Email: dalton.edgecomb@riveron.com
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ARMSTRONG FLOORING: Seeks to Hire Skadden as Bankruptcy Counsel
---------------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Skadden,
Arps, Slate, Meagher & Flom, LLP to serve as legal counsel in their
Chapter 11 cases.
The firm's services include:
(a) advising the Debtors with respect to their powers and
duties in the continued management and operation of their
businesses and properties;
(b) advising the Debtors in connection with their potential
sale under a Chapter 11 plan of reorganization or pursuant to
Bankruptcy Code Section 363;
(c) advising the Debtors with respect to the analysis of their
pre-bankruptcy and post-petition credit agreements;
(d) attending meetings and negotiating with representatives of
creditors and other concerned parties, and consulting on the
conduct of the cases, including all of the legal and administrative
requirements of operating in Chapter 11;
(e) taking all necessary actions to protect and preserve the
Debtors' estates, including the prosecution of actions on the
Debtors' behalf, the defense of actions commenced against the
Debtors' estates, negotiations concerning litigation in which the
Debtors may be involved, and objections to claims filed against the
Debtors' estates;
(f) preparing legal papers;
(g) negotiating and preparing a plan of reorganization,
disclosure statement and all related documents, and taking any
necessary action on behalf of the Debtors to obtain confirmation of
the plan;
(h) appearing before the bankruptcy court, any appellate
courts and the Office of the U.S. Trustee; and
(i) performing all other necessary legal services for the
Debtors.
The firm's attorneys will be paid at hourly rates as follows:
Associates $550 - $1,275
Counsel $1,300 - $1,495
Partners $1,465 - $1,980
The firm received a retainer in the amount of $5.91 million.
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Skadden
disclosed that:
-- It has not agreed to any variations from, or alternatives
to, its standard or customary billing arrangements for this
engagement.
-- No Skadden professional included in the engagement has
varied his rate based on the geographic location of the bankruptcy
cases.
-- Skadden represented the Debtors in the 12 months prior to
their bankruptcy filing. During that representation, on Jan. 1,
2022, Skadden raised its billing rates, as it does customarily from
time to time.
-- The Debtors filed an approved 45-day cash flow budget,
which included a line item for "Professional Fees," including
Skadden's fees.
The firm can be reached through:
Ron E. Meisler, Esq.
Skadden, Arps, Slate, Meagher & Flom LLP
155 N. Wacker Drive
Chicago, ILs 60606
Tel: 312-407-0700
Fax: 312-407-0411
Email: ron.meisler@skadden.com
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ARMSTRONG FLOORING: Taps Borden Ladner Gervais as Canadian Counsel
------------------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Borden
Ladner Gervais, LLP as their special Canadian counsel.
The firm's services include:
a. advising the Debtors regarding their rights and duties
under Canadian law;
b. commencing, on the Debtors' behalf, the ancillary
proceeding under the Companies' Creditors Arrangement Act;
c. preparing legal documents;
d. advising the Debtors regarding issues of Canadian law
arising during the course of the operation of their business; and
e. performing all other necessary legal services for the
Debtors.
The hourly rates charged by the firm for its services are as
follows:
Partners $417 - $1,013 per hour
Associates $444 per hour
Paralegals $313 per hour
As disclosed in court filings, Borden 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, Borden
disclosed that:
-- it has not agreed to any variations from, or alternatives
to, its standard or customary billing arrangements for this
engagement;
-- no Borden professional included in the engagement has
varied his rate based on the geographic location of the bankruptcy
cases;
-- the billing rates and material terms of the pre-bankruptcy
engagement are the same as the rates and terms proposed by the
firm; and
-- the Debtors have approved or will be approving a
prospective budget and staffing plan for Borden's engagement for
the post-petition period as appropriate.
The firm can be reached through:
Roger Jaipargas
Borden Ladner Gervais LLP
Centennial Place, East Tower
520 3rd Avenue SW, Suite 1900
Calgary, AB
Phone: 1 855-660-6003
Fax: 403-266-1395
Email: RJaipargas@blg.com
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ARMSTRONG FLOORING: Taps Chipman Brown Cicero & Cole as Co-Counsel
------------------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Chipman
Brown Cicero & Cole, LLP as co-counsel with Skadden, Arps, Slate,
Meagher & Flom, LLP.
The firm's services include:
a. advising the Debtors with respect to their powers and
duties in the continued management and operation of their
businesses and properties;
b. attending meetings and negotiating with representatives of
creditors and other concerned parties, and consulting on the
conduct of the Debtors' Chapter 11 cases, including all of the
legal and administrative requirements of operating in Chapter 11;
c. taking all necessary actions to protect and preserve the
Debtors' estates, including the prosecution of actions on their
behalf, the defense of actions commenced against the estates,
negotiations concerning litigation in which the Debtors may be
involved, and objections to claims filed against the Debtors or
their estates;
d. preparing legal papers;
e. advising the Debtors in connection with the sale of any
assets;
f. appearing before the bankruptcy court, any appellate
courts, and the Office of the U.S. Trustee; and
g. performing all other necessary legal services for the
Debtors.
The hourly rates charged by the firm's attorneys and paralegals are
as follows:
Robert A. Weber $700
Mark Desgrosseilliers $700
Mark D. Olivere $525
Aidan T. Hamilton $350
Renae M. Fusco $275
Partners $500 - $750
Associates $275 - $350
Paralegals $200 - $275
As disclosed in court filings, Chipman 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, Chipman
disclosed that:
-- it has not agreed to any variations from, or alternatives
to, its standard or customary billing arrangements for this
engagement;
-- none of the professionals included in the engagement vary
their rate based on the geographic location of the bankruptcy
cases;
-- the firm has not represented the Debtors in the 12 months
prepetition; and
-- a preliminary prospective budget and staffing plan for the
post-petition period that includes the firm as well as the other
advisors has been approved by the Debtors.
Chipman can be reached through:
Michel S. Vermette, Esq.
Chipman Brown Cicero & Cole, LLP
1313 N. Market Street, Suite 5400
Wilmington, DE 19801
Tel: 302-414-8906
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ARMSTRONG FLOORING: Taps Epiq as Administrative Advisor
-------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Epiq
Corporate Restructuring, LLC as their administrative advisor.
The firm's services include:
(a) assisting in the solicitation, balloting and tabulation of
votes, and preparing any appropriate reports in support of
confirmation of the Debtors' plan of liquidation or
reorganization;
(b) generating an official ballot certification and
testifying, if necessary, in support of the ballot tabulation
results;
(c) responding to requests for documents;
(d) gathering data for, and assisting in the preparation of,
the Debtors' schedules of assets and liabilities and statements of
financial affairs;
(e) assisting the Debtors in reconciling claims;
(f) providing the Debtors with standard reports (as well as
consulting and programming support for reports that the Debtors
request), program modifications, database modifications, and other
features;
(g) providing a confidential data room, if requested; and
(h) managing and coordinating any distributions pursuant to a
confirmed plan of reorganization or liquidation or otherwise.
The firm will be paid at hourly rates as follows:
Clerical/Administrative Support $25 - $55
IT / Programming $65 - $85
Project Managers/Consultants/ Directors $54 - $170
Solicitation Consultant $165
Executive Vice President, Solicitation $175
Executives No Charge
The firm received a retainer in the amount of $25,000.
Kathryn Tran, consulting director at Epiq, disclosed in court
filings that her firm is a "disinterested person" within the
meaning of Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Kathryn Tran
Epiq Corporate Restructuring, LLC
777 Third Avenue, 12th Floor
New York, NY 10017
Phone: +1 714 394 6998
Email: ktran@epiqglobal.com
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ARMSTRONG FLOORING: Taps Friedman as Special Conflicts Counsel
--------------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Friedman
Kaplan Seiler & Adelman, LLP as their special conflicts counsel.
Friedman will represent the Debtors in matters adverse or
potentially adverse to certain "secured parties," including their
motion filed on May 9 for interim and final orders approving use of
cash collateral and debtor-in-possession facility.
The hourly rates charged by the firm's attorneys and paralegals are
as follows:
Edward A. Friedman $1,900 per hour
Robert J. Lack $1,450 per hour
Jeffrey C. Fourmaux $1,050 per hour
Geoffrey Cajigas $750 per hour
Bria D. Delaney $650 per hour
Philip J. Biegler $650 per hour
Attorneys $600 - $1,900 per hour
Paralegals $275 - $365 per hour
Friedman Kaplan received a $350,000 retainer.
As disclosed in court filings, Friedman 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,
Friedman disclosed that:
-- The firm has not agreed to any variations from, or
alternatives to, its standard or customary billing arrangements for
this engagement.
-- No Friedman professional included in the engagement has
varied his rate based on the geographic location of the bankruptcy
cases.
-- The firm represented the Debtors from April 27 to May 7,
2022, and received a fixed retainer in the total amount of $350,000
for its pre-bankruptcy work. The firm will be compensated on an
hourly fee basis for its post-petition work.
-- The firm and the Debtors expect to develop a specific
prospective budget and staffing plan to comply with the U.S.
Trustee's requests for information and additional disclosures, and
any orders of the court.
The firm can be reached through:
Edward A. Friedman, Esq.
Friedman Kaplan Seiler & Adelman LLP
7 Times Square
New York, NY 10036-6516
Tel: 212-833-1100
Fax: 212-373-7902
Email: efriedman@fklaw.com
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ARMSTRONG FLOORING: Taps Groom Law as Employee Benefits Counsel
---------------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates received approval from
the U.S. Bankruptcy Court for the District of Delaware to hire
Groom Law Group, Chartered as their employee benefits counsel.
The Debtors need the firm's legal advice on these matters:
(i) legal issues associated with the retirement income plan
for Armstrong Flooring's employees and welfare benefit program for
its retirees (OPEB plan);
(ii) termination of the retirement income plan;
(iii) elimination of medical, prescription drug and dental
benefits, and life insurance benefits under the OPEB plan;
(iv) issues related to the Debtors' obligations under ERISA,
the Internal Revenue Code of 1986, as amended, and the Bankruptcy
Code with respect to the retirement income plan and OPEB plan;
(iv) any investigations, inquiries, or claims made by the
Department of Labor, the Internal Revenue Service, the Pension
Benefit Guaranty Corporation, or the U.S. Trustee with respect to
the retirement income plan and OPEB plan;
(v) claims by plan participants or beneficiaries that relate
to the retirement income plan or OPEB plan; and
(vi) any proceedings, including litigation, before the
bankruptcy court, any appellate court, or any other court of
competent jurisdiction relating to the retirement income plan or
OPEB plan.
The firm received retainer payments in the total amount of
$199,875.
As disclosed in court filings, Groom Law Group 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, Groom
Law Group disclosed that:
-- it has not agreed to any variations from, or alternatives
to, its standard or customary billing arrangements for this
engagement;
-- no Groom Law Group professional included in the engagement
has varied his rate based on the geographic location of the
bankruptcy cases;
-- it has represented the Debtors since March 2022 per the
terms of the Engagement Agreement; and
-- the firm and the Debtors have not developed a budget and
staffing plan.
The firm can be reached through:
Katherine B. Kohn
Groom Law Group, Chartered
Pennsylvania Avenue NW
Washington, DC 20006
Phone: 202-857-0620/202-861-2607
Email: kkohn@groom.com
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ARMSTRONG FLOORING: Taps Houlihan Lokey as Financial Advisor
------------------------------------------------------------
Armstrong Flooring, Inc. and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Delaware to hire Houlihan
Lokey Capital, Inc. as their financial advisor and investment
banker.
The firm's services include:
(a) reviewing the Debtors' financial condition and business;
(b) assisting the Debtors in soliciting, coordinating and
evaluating indications of interest and proposals regarding a
transaction from current or potential lenders, equity investors,
acquirers and strategic partners;
(c) assisting the Debtors in negotiating financial aspects of
a transaction, including participating in negotiations with
creditors and other parties involved in the transaction;
(d) providing expert advice and testimony regarding financial
matters related to any transaction, if necessary;
(e) presenting financial analyses to the Debtors and their
Board of Directors or any appropriate committee thereof, from time
to time, and otherwise assisting in keeping the Board informed
regarding the status of any transaction;
(f) attending meetings of creditor groups, official
constituencies and other interested parties, as the Debtors and
Houlihan Lokey mutually agree;
(g) providing strategic advice with regard to various
alternatives being considered by the Debtors;
(h) reviewing and providing an analysis of any transaction
structuring analysis proposed by the Debtors or any other party
and, if requested, performing a transaction structuring analysis of
the Debtors or their assets;
(i) providing testimony;
(j) assisting in the preparation of information memorandum (or
similar document) describing the Debtors; and
(k) such other financial advisory and investment banking
services as may be agreed upon by Houlihan Lokey and the Debtors.
The firm will be compensated as follows:
(i) Initial Fee: Upon the execution of their agreement, the
Debtors will pay Houlihan a nonrefundable cash fee of $450,000
(signing fee);
(ii) Monthly Fees: Starting April 1, 2022, and on every monthly
anniversary thereof during the term of the agreement, the Debtors
will pay Houlihan in advance, without notice or invoice, a
nonrefundable cash fee of $150,000.
(iii) Transaction Fees: Houlihan will receive transaction fees
as follows:
a. Sale Transaction Fee. Upon the closing of the sale
transaction, Houlihan shall be paid directly from the gross
proceeds of such transaction a cash fee based upon aggregate gross
consideration (AGC), calculated as follows:
- For AGC up to $150 million: $3,450,000, plus
- For AGC from $150 million to $175 million: 3.5
percent of such incremental AGC, plus
- For AGC in excess of $175 million: 4.5 percent of
such incremental AGC.
If more than one sale transaction is consummated, Houlihan shall be
compensated based on the AGC from all sale transactions.
b. Financing Transaction Fee. Upon the closing of each
financing transaction, Houlihan shall be paid directly from the
gross proceeds of such transaction a cash fee equal to the sum of:
(I) 1.5 percent of the gross proceeds of any indebtedness raised or
committed that is senior to other indebtedness of the Company,
secured by a first priority lien and unsubordinated, with respect
to both lien priority and payment, to any other obligations of the
Company; (II) 3.0 percent of the gross proceeds of any indebtedness
raised or committed that is secured by a lien (other than a first
lien), or is unsecured and/or is subordinated; and (III) 5.0
percent of the gross proceeds of all equity or equity-linked
securities (including, without limitation, convertible securities
and preferred stock) placed or committed. Any warrants issued in
connection with the raising of debt or equity capital shall, upon
the exercise thereof, be considered equity for the purpose of
calculating the financing transaction fee, and such portion of the
financing transaction fee shall be paid upon such exercise and from
the gross proceeds thereof, regardless of any prior termination or
expiration of this Agreement. It is understood and agreed that if
the proceeds of any such financing transaction are to be funded in
more than one stage, Houlihan shall be entitled to its applicable
compensation hereunder upon the closing date of each stage. The
financing transaction fee(s) shall be payable in respect of any
sale of securities whether such sale has been arranged by Houlihan,
by another agent or directly by Armstrong Flooring or any of its
affiliates. Any non-cash consideration provided to or received in
connection with the financing transaction (including but not
limited to intellectual or intangible property) shall be valued for
purposes of calculating the financing transaction fee as equaling
the number of securities issued in exchange for such consideration
multiplied by (in the case of debt securities) the face value of
each such Security or (in the case of equity securities) the price
per Security paid in the then current round of financing. The fees
set forth herein shall be in addition to any other fees that the
Debtors may be required to pay to any investor or other purchaser
of Securities to secure its financing commitment.
Notwithstanding the foregoing, any financing transaction fee
payable shall be subject to a $1,000,000 minimum financing
transaction fee payable upon the closing of the transaction;
provided that the financing transaction fee payable for any
debtor-in-possession financing that is provided by existing lenders
to the Debtors shall be subject to a total cash fee not to exceed
$750,000.
c. Restructuring Transaction Fee. Upon the earlier to
occur of: (I) in the case of an out-of-court restructuring
transaction, the closing of such transaction; and (II) in the case
of an in-court restructuring transaction, the effective date of a
plan of reorganization or liquidation under Chapter 11 or Chapter 7
of the Bankruptcy Code pursuant to an order of the bankruptcy
court, Houlihan shall be paid a cash fee of $3,450,000.
Jeffrey Lewis, managing director at Houlihan, disclosed in a court
filing that his firm is a "disinterested person" within the meaning
of Section 101(14) of the Bankruptcy Code.
Houlihan can be reached at:
Jeffrey Lewis
Houlihan Lokey Capital, Inc.
10250 Constellation Blvd., 5th Floor
Los Angeles, CA 90067
Phone: 310-553-8871
Fax: 310-553-2173
About Armstrong Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a global manufacturer of
flooring products. Headquartered in Lancaster, Pa., Armstrong
Flooring operates eight manufacturing facilities globally.
Armstrong Flooring and its affiliates sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. D. Del. Lead Case No.
22-10426) on May 8, 2022. In its petition, Armstrong Flooring
listed $100 million to $500 million in both assets and liabilities.
Michel S. Vermette, president and chief executive officer, signed
the petition.
Judge Mary F. Walrath oversees the cases.
The Debtors hired Skadden, Arps, Slate, Meagher & Flom, LLP and
Chipman Brown Cicero & Cole, LLP as bankruptcy counsels; and
Houlihan Lokey Capital, Inc. as financial advisor and investment
banker. The Debtors also tapped Riveron Consulting, LP to provide
interim management services and designated Dalton Edgecomb of
Riveron as their chief transformation officer.
Meanwhile, Friedman Kaplan Seiler & Adelman, LLP, Groom Law Group,
Chartered and Borden Ladner Gervais LLP serve as the Debtors'
special counsels. Epiq Corporate Restructuring, LLC is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors in the Debtors' Chapter 11 cases
on May 18, 2022. The committee is represented by Cole Schotz P.C.
ASPIRA WOMEN'S: Falls Short of Nasdaq Minimum Bid Price Requirement
-------------------------------------------------------------------
Aspira Women's Health Inc. received a deficiency letter from the
Listing Qualifications Department of the Nasdaq Stock Market
notifying the Company that, for the preceding 30 consecutive
business days, the closing bid price for the Company's common stock
was below the minimum $1.00 per share requirement for continued
inclusion on The Nasdaq Capital Market pursuant to Nasdaq Listing
Rule 5550(a)(2). In accordance with Nasdaq rules, the Company has
been provided an initial period of 180 calendar days, or until
Nov. 28, 2022, to regain compliance with the Bid Price Requirement.
If, at any time before the Compliance Date, the closing bid price
for the Company's common stock is at least $1.00 for a minimum of
10 consecutive business days, the Staff will provide the Company
written confirmation of compliance with the Bid Price Requirement.
If the Company does not regain compliance with the Bid Price
Requirement by the Compliance Date, the Company may be eligible for
an additional 180 calendar day compliance period. To qualify, the
Company would need to provide written notice of its intention to
cure the deficiency during the additional compliance period, by
effecting a reverse stock split, if necessary, provided that it
meets the continued listing requirement for the market value of
publicly held shares and all other initial listing standards for
The Nasdaq Capital Market, with the exception of the Bid Price
Requirement.
If the Company does not regain compliance with the Bid Price
Requirement by the Compliance Date and is not eligible for an
additional compliance period at that time, the Staff will provide
written notification to the Company that its common stock will be
subject to delisting. At that time, the Company may appeal the
Staff's delisting determination to a Nasdaq Hearing Panel. There
can be no assurance that the Company will regain compliance or
otherwise maintain compliance with any of the other listing
requirements.
The Company intends to monitor the closing bid price of its common
stock and may, if appropriate, consider available options to regain
compliance with the Bid Price Requirement.
About Aspira Women's Health
ASPIRA formerly known as Vermillion, Inc. --
http://www.aspirawh.com-- is transforming women's health with the
discovery, development and commercialization of innovative testing
options and bio-analytical solutions that help physicians assess
risk, optimize patient management and improve gynecologic health
outcomes for women. OVA1 plus combines its FDA-cleared products
OVA1 and OVERA to detect risk of ovarian malignancy in women with
adnexal masses. ASPiRA GenetiXSM testing offers both targeted and
comprehensive genetic testing options with a gynecologic focus.
With over 10 years of expertise in ovarian cancer risk assessment
ASPIRA has expertise in cutting-edge research to inform its next
generation of products. Its focus is on delivering products that
allow healthcare providers to stratify risk, facilitate early
detection and optimize treatment plans.
Aspira Women's reported a net loss of $31.66 million for the year
ended Dec. 31, 2021, a net loss of $17.91 million for the year
ended Dec. 31, 2020, a net loss of $15.24 million for the year
ended Dec. 31, 2019, and a net loss of $11.37 million for the year
ended Dec. 31, 2018. As of March 31, 2022, the Company had $30.86
million in total assets, $9.12 million in total liabilities, and
$21.74 million in total stockholders' equity.
ATLAS MIDCO: S&P Alters Outlook to Stable, Affirms 'B-' ICR
-----------------------------------------------------------
S&P Global Ratings revised its outlook on the ratings on U.S.-based
provider of contact center and workforce optimization software
Atlas Midco Inc. (Alvaria) and its wholly owned borrowing entity,
Atlas Purchaser Inc. to stable from positive and affirmed its 'B-'
issuer credit ratings.
The stable outlook reflects S&P's expectation that Alvaria will
return to low-single-digit-percent pro forma revenue growth in 2022
helped by investments in its sales and customer success functions,
while EBITDA margins will remain in the low- to mid-30% area in
2022, resulting in leverage of just below 7x.
S&P Said, "Organic growth investments and some sales disruptions
will result in slower deleveraging than we initially expected. The
outlook revision is driven by our updated view on Alvaria's
near-term deleveraging prospects following the secondary buyout of
Aspect Software and merger with Noble Systems in May 2021. We now
expect leverage to decline to just below 7x in 2022 compared to our
initial expectations of the 6x area. In particular, the company has
decided to reinvest some of its cost synergies in strengthening
internal functions to support greater organic revenue growth and
revenue retention rates. At the same time, the combined company has
been experiencing weaker-than-expected bookings, especially
regarding on-premise licenses, partly due to sales disruptions
related to the Noble integration and some changes in its internal
processes. We believe the company's sales execution should steadily
improve toward the end of 2022 and onwards.
"The stable outlook reflects our expectation that Alvaria will
return to low-single-digit-percent pro forma revenue growth in
2022, helped by investments in its sales and customer success
functions, while the company is able to successfully manage its CEO
transition and weaker sales execution in the first half of the
year. We expect EBITDA margins to remain in the low- to mid-30%
area in 2022, resulting in leverage of just below 7x."
S&P could raise its rating if:
-- S&P believes Alvaria will maintain sustained pro forma revenue
growth supported by a return to significant bookings growth from
effective sales execution and ongoing strong demand for cloud
products and cross-selling activities;
-- EBITDA margins are maintained well above 30% with the company
maintaining adequate cost discipline while investing to support
organic growth; and
-- S&P expects leverage to stay below 6.5x or free operating cash
flow (FOCF) to debt above 5%, even after accounting for potential
acquisitions or shareholder distributions.
S&P could lower its rating if it considers Alvaria's capital
structure as unsustainable, which could be signaled by:
-- Significant revenue declines, perhaps because of weak customer
demand, increased customer churn, or poor sales execution;
-- Elevated spending on organic or inorganic growth investments
that drain liquidity or have less-than-expected contributions to
revenues and EBITDA; or
-- Expectations of sustained negative FOCF.
ESG credit indicators: E-2, S-2, G-3
BACKYARD ACQUIRECO: S&P Places 'B' ICR on CreditWatch Positive
--------------------------------------------------------------
S&P Global Ratings placed all its ratings on U.S.-based vinyl and
aluminum fencing and railing provider Backyard Acquireco Inc.,
doing business as Barrette Outdoor Living, including its 'B' issuer
credit rating, on CreditWatch with positive implications.
The CreditWatch placement indicates that the proposed transaction
could potentially benefit the company's credit quality since it is
being acquired by a much larger and higher-rated company. S&P said,
"On a stand-alone basis, the company's performance and credit
measures remain in line with our expectations helped by strong
demand from residential end markets. Furthermore, while ongoing
inflationary pressures and potentially slower demand from
macroeconomic concerns could depress earnings, we believe the
company's credit measures contain sufficient cushion. As such, we
expect adjusted leverage to be stay below 5x."
CreditWatch
S&P said, "We expect to resolve the CreditWatch placement once the
transaction closes, likely in the second half of 2022. We will
likely discontinue our ratings if the company's debt is retired.
Alternatively, we could raise our ratings if its debt remains
outstanding, to that of the 'BBB+' issuer credit rating on CRH. The
rating outlook on CRH is stable."
BACKYARD MIDCO: Moody's Puts 'B1' CFR Under Review for Upgrade
--------------------------------------------------------------
Moody's Investors Service placed the B1 corporate family rating,
B1-PD probability of default rating and B1 senior secured first
lien term loan rating of Backyard Midco, Inc. (Barrette Outdoor
Living) on review for upgrade.
This action follows the announcement on June 3, 2022 that CRH plc
(Baa1 stable) had reached an agreement to acquire Barrette for $1.9
billion. The transaction is targeted to close in the second half of
2022 and is subject to regulatory approval.
On Review for Upgrade:
Issuer: Backyard Midco, Inc.
Corporate Family Rating, Placed on Review for Upgrade, currently
B1
Probability of Default Rating, Placed on Review for Upgrade,
currently B1-PD
Senior Secured 1st Lien Bank Credit Facility, Placed on Review for
Upgrade, currently B1 (LGD4)
Outlook Actions:
Issuer: Backyard Midco, Inc.
Outlook, Changed To Rating Under Review From Stable
RATINGS RATIONALE / FACTORS THAT COULD LEAD TO AN UPGRADE OR
DOWNGRADE OF THE RATINGS
Moody's review will consider the ultimate fate of Barrette's first
lien term loan upon the close of the acquisition by CRH, which
could include the term loan remaining an obligation of CRH, being
exchanged for CRH debt, being refinanced, or being repaid. If
Barrette's debt is retired, Moody's will withdraw its ratings upon
repayment. If Barrette's debt is not retired following the closing
of the acquisition, Moody's ability to maintain the company's
ratings will consider where in the corporate structure Barrette's
debt will reside, any guarantees of Barrette's debt by CRH plc, and
the financial and operational disclosures available with respect to
Barrette Outdoor Living.
Barrette's B1 Corporate Family Rating reflects the company's solid
financial profile, including strong EBITA margins, low leverage and
high interest coverage. The rating is further supported by
favorable fundamentals that support investment in home improvement,
including the desire to increase home values. These factors are
offset by the company's reliance on The Home Depot and Lowe's,
which collectively represent over 35% of revenues, as these
retailers are high-volume purchasers with strong bargaining power,
which could negatively impact the company's sales volumes or
margins. Moody's ratings also consider Barrette's exposure to new
housing construction, where demand tends to be more volatile
through cycles. Finally, raw material cost inflation of resin and
aluminum places some downward pressure on margins.
Absent the acquisition by CRH, the ratings could be upgraded if
Barrette operates with debt / EBITDA sustained below 3.5x and free
cash flow/ debt approaching 7.5%. An upgrade would also reflect an
expanded scale while maintaining a conservative financial policy
and ongoing positive trends in end markets continuing to support
growth.
Given the rating under review for upgrade, a negative rating action
is not considered likely in the near term. However, absent the
acquisition by CRH the ratings could be downgraded if the company's
debt / EBITDA is sustained above 4.5x or if EBITA / interest
expense remains below 2.0x. A negative rating action would also
reflect a failure to generate meaningful levels of free cash flow
or the execution of a sizable debt-financed acquisition.
The principal methodology used in these ratings was Manufacturing
published in September 2021.
Barrette Outdoor Living, headquartered in Ohio, is a leading
manufacturer and distributor of wood-alternative fence and railing,
with a growing presence in decking and other outdoor living
products. For the twelve months ended April 2, 2022, the company
generated roughly $873 million in revenue.
BITNILE HOLDINGS: Files Preferred Stock Certificate of Designation
------------------------------------------------------------------
BitNile Holdings, Inc. filed a Certificate of Designation, Rights
and Preferences on May 25, 2022, with the Secretary of State of the
State of Delaware to establish the preferences, voting powers,
limitations as to dividends or other distributions, qualifications,
terms and conditions of redemption and other terms and conditions
of the Company's 13.00% Series D Cumulative Redeemable Perpetual
Preferred Stock.
To the extent the Company issues its Series D Preferred Stock, the
ability of the Company to declare or pay dividends on, or purchase,
redeem or otherwise acquire, shares of its common stock, par value
$0.001 per share, or any shares of other stock of the Company that
rank junior to or on parity with the Series D Preferred Stock
either as to the payment of dividends and/or as to the distribution
of assets upon the liquidation, dissolution or winding up of the
Company will be subject to certain restrictions in the event that
the Company does not declare and pay (or set aside) dividends on
the Series D Preferred Stock.
The Series D Preferred Stock will, as to dividend rights and rights
as to the distribution of assets upon the Company's liquidation,
dissolution or winding-up, rank: (1) senior to all classes or
series of Common Stock and to all other equity securities issued by
the Company other than equity securities referred to in clauses (2)
and (3); (2) on parity with any future class or series of the
Company's equity securities expressly designated as ranking on
parity with the Series D Preferred Stock, including the Company's
Series A Cumulative Redeemable Perpetual Preferred Stock and Series
C Convertible Redeemable Preferred Stock; (3) junior to the
Company's Series B Convertible Preferred Stock and all equity
securities issued by the Company expressly designated as ranking
senior to the Series D Preferred Stock; and (4) junior to all the
Company's existing and future indebtedness.
To the extent the shares of Series D Preferred Stock are issued,
the Company will pay cumulative cash dividends on the Series D
Preferred Stock when, as and if declared by its board of directors
(or a duly authorized committee of its board of directors), only
out of funds legally available for payment of dividends. Dividends
on the Series D Preferred Stock will accrue on the stated amount of
$25.00 per share of the Series D Preferred Stock at a rate per
annum equal to 13.00% (equivalent to $3.25 per year), payable
monthly in arrears.
The Series D Preferred Stock is redeemable by the Company under
certain circumstances. Holders of shares of the Series D Preferred
Stock generally will have no voting rights, except as required by
law and as provided in the Certificate of Designation. Voting
rights for holders of the Series D Preferred Stock exist primarily
with respect to material and adverse changes in the terms of the
Series D Preferred Stock and the creation of additional classes or
series of preferred stock that rank senior to the Series D
Preferred Stock.
Further, unless the Company has received the approval of two-thirds
of the votes entitled to be cast by the holders of Series D
Preferred Stock, the Company will not effect any consummation of a
binding share exchange or reclassification of the Series D
Preferred Stock or a merger or consolidation of the Company with
another entity, unless (a) the shares of Series D Preferred Stock
remain outstanding or, in the case of a merger or consolidation
with respect to which the Company is not the surviving entity, the
shares of Series D Preferred Stock are converted into or exchanged
for preference securities, or (b) such shares remain outstanding or
such preference securities are not materially less favorable than
the Series D Preferred Stock immediately prior to such
consummation.
About BitNile Holdings
BitNile Holdings, Inc. (formerly known as Ault Global Holdings,
Inc.) is a diversified holding company pursuing growth by acquiring
undervalued businesses and disruptive technologies with a global
impact. Through its wholly and majority-owned subsidiaries and
strategic investments, the Company owns and operates a data center
at which it mines Bitcoin and provides mission-critical products
that support a diverse range of industries, including
defense/aerospace, industrial, automotive, telecommunications,
medical/biopharma, and textiles. In addition, the Company extends
credit to select entrepreneurial businesses through a licensed
lending subsidiary. BitNile's headquarters are located at 11411
Southern Highlands Parkway, Suite 240, Las Vegas, NV 89141;
www.BitNile.com.
BitNile reported a net loss of $23.97 million for the year ended
Dec. 31, 2021, a net loss of $32.73 million for the year ended Dec.
31, 2020, a net loss of $32.94 million for the year ended Dec. 31,
2019, and a net loss of $32.98 million for the year ended Dec. 31,
2018. As of March 31, 2022, the Company had $518.92 million in
total assets, $93.74 million in total liabilities, $116.73 million
in redeemable noncontrolling interests in equity of subsidiaries,
and $308.46 million in total stockholders' equity.
BMW NATIONWIDE: Security Provider Files Subchapter V Case
---------------------------------------------------------
BMW Nationwide Security Inc. filed for bankruptcy protection in Los
Angeles, California, seeking relief under Subchapter V of Chapter
11 of the Bankruptcy Code.
BMW Nationwide was started in March 2017 by Leo S. Gilbert. The
Debtor offers security guard services throughout Southern
California for special events such as concerts, football, soccer
and other game events, carnivals, conventions, meetings, Coachella,
and Stagecoach.
The Debtor does not own any real property assets. The Debtor's
personal property assets total $586,643 and include $117,143 in
cash in the Debtor's bank accounts, $464,000 from accounts
receivable, and $5,000 in office furniture.
The Debtor's secured creditors are the U.S. Small Business
Administration for $2 million claim and Wells Fargo Vendor
Financial Services for an equipment lease for the Debtor's copiers
and printers.
The Debtor has no priority unsecured creditors and the Debtor's
general unsecured creditors include two pending lawsuits by Delores
Ward and Staff Pro, Inc., against the Debtor and US Bank PPP loan
for an estimated $521,245.
The events that precipitated the filing of the Chapter 11
bankruptcy were the pending lawsuits against the Debtor.
The Debtor is optimistic that it will be able to resolve the
pending lawsuits and enter into plan treatment stipulations with
its creditors. Without question, the Covid pandemic has negatively
impacted the country's economy and devastated certain sectors of
the economy. The Debtor's operations have been impacted by the
pandemic as well. However, the Debtor currently has a number of
booked events and is confident that it can generate the income
necessary to support a feasible reorganization plan.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for June 24, 2022 at 01:30 p.m.
About BMW Nationwide Security
BMW Nationwide Security Inc. primarily operates in the Guard
Services business.
BMW Nationwide Security sought protection under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Case No.
22-12988) on May 28, 2022.
In the petition signed by Leo S.Gilbert, as president, BMW
Nationwide Security estimated assets and liabilities between
$500,000 and $1 million each. BMW Nationwide estimates between 1
and 49 unsecured creditors. The petition states funds will be
available to unsecured creditors.
The case is overseen by Honorable Bankruptcy Judge Vincent P
Zurzolo.
Michael Jay Berger, of Law Offices of Michael Berger, is the
Debtor's counsel.
BOY SCOUTS: Owns $10 Billion Worth of Land That Developers Want
---------------------------------------------------------------
The Associated Press reports that bankrupt Boy Scouts of America
may have $10 billion in land that developers want.
As the financially struggling Boy Scouts sell off a growing number
of campgrounds — conservationists, government officials and
others are scrambling to find ways to preserve them as open space.
The land sales are filling the gap of declining enrollment and
helping fund a proposed national bankruptcy settlement designed to
pay thousands of victims of child sexual abuse. It’s unclear how
much land belongs to the Boy Scouts, partly because it's owned by
local scout councils.
But evidence in the Scouts' bankruptcy trial indicate there are
about 2,000 properties that could be worth as much as $10 billion,
and some of which is being sought by developers.
For over a century the Scouts and their local councils have
acquired properties across the country where generations have
learned to appreciate the outdoors through camping, swimming and
canoeing.
Councils in states including Arizona, Connecticut, Illinois, Maine,
Michigan, Missouri, New York, New Jersey, Pennsylvania and
Wisconsin have all recently sold or announced plans to sell camps.
Critics say selling camps to developers goes against the tenants of
an organization that is supposed to teach environmental
stewardship.
About Boy Scouts of America
The Boy Scouts of America -- https://www.scouting.org/ -- is a
federally chartered non-profit corporation under title 36 of the
United States Code. Founded in 1910 and chartered by an act of
Congress in 1916, the BSA's mission is to train youth in
responsible citizenship, character development, and self-reliance
through participation in a wide range of outdoor activities,
educational programs, and, at older age levels, career-oriented
programs in partnership with community organizations. Its national
headquarters is located in Irving, Texas.
The Boy Scouts of America and affiliate Delaware BSA, LLC, sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on
Feb. 18, 2020, to deal with sexual abuse claims.
Boy Scouts of America was estimated to have $1 billion to $10
billion in assets and at least $500 million in liabilities as of
the bankruptcy filing.
The Debtors have tapped Sidley Austin LLP as their bankruptcy
counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel,
and Alvarez & Marsal North America, LLC, as financial advisor. Omni
Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed a tort claimants' committee
and an unsecured creditors' committee on March 5, 2020. The tort
claimants' committee is represented by Pachulski Stang Ziehl &
Jones, LLP, while the unsecured creditors' committee is represented
by Kramer Levin Naftalis & Frankel, LLP.
BROWN BIDCO: S&P Affirms 'B+' Issuer Credit Rating, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings affirmed its 'B+' issuer credit rating on
Orlando, Fla.-based aviation services provider Brown Bidco Ltd.
(doing business as Signature Aviation).
S&P said, "We also assigned our 'B+' and '3' issue-level and
recovery ratings to the new term loan B-2 and affirmed our 'B+'
issue-level rating on the company's existing term loan B, revolver,
and senior secured notes. The recovery rating on the debt remains
'3'.
"The stable outlook reflects our expectation that healthy demand
for private air travel will support Signature's earnings growth,
resulting in adjusted leverage declining to the low-6x area by
year-end 2022, from 7.1x at transaction close.
"We affirmed the ratings because we believe that Signature's
entrenched market leadership position and resilient demand for
private air travel will enable it to service its higher debt
burden. Following the transaction, Signature's funded debt will
increase by $1.1 billion to over $3 billion. Despite the additional
debt, we expect Signature will continue its healthy earnings growth
trajectory and reduce leverage over time because business and
general aviation flight movements remain healthy at the airports at
which Signature operates. Following steep declines early in the
COVID-19 pandemic, general aviation flight operations swiftly
recovered and are now 20% above 2019 levels while commercial flight
operations have not yet returned to pre-pandemic levels. This
strong rebound has been partially driven by commercial route
consolidation and commercial pilot shortages, as well as the
relative safety of private travel during the COVID-19 pandemic, the
proliferation of fractional ownership and charter customers, and
rising individual net worth.
"Although revenue growth should normalize, we expect Signature will
generate healthy EBITDA growth driving leverage toward the low-6x
in 2022, and to the high-5x area in 2023, from 7.1x at transaction
close."
The TAC Air acquisition is high priced in relation to its
incremental EBITDA contribution, but it will reinforce Signature's
market leadership and enhance its economies of scale. S&P believes
the acquisition will provide meaningful competitive benefits.
Signature operates the largest network of fixed-base operations
(FBO) services providers in North America, and following the
transaction, its North American FBO footprint (excluding private
hangars) will expand to 151 locations, including TAC Air's 14
sites. The acquisitions will increase Signatures' presence on the
most trafficked runways in North America, which should improve the
stability and predictability of its revenue and earnings.
Large FBOs benefit from significant economies of scale for fuel and
insurance purchases and pilot incentive programs, and Signature is
significantly larger than its competitors. These include Atlantic
Aviation, the second-largest North American network with 93
locations, and many much smaller providers. S&P views Signature's
market position as highly defensible given its long-dated airport
leases (pro forma 17-year weighted average) and the inherent
limitations on runway space, which provide a natural barrier to
competition.
S&P said, "Despite the incremental interest expense and elevated
capital investments, we forecast healthy cash flow conversion. Pro
forma for the transaction, the company's run-rate interest expense
will increase by about $60 million. In addition, we forecast
Signature will invest roughly $200 million annually in capital
expenditure (capex) in 2022 and 2023 as it develops hangar space on
and near its existing leases to meet rising demand for hangar
rental services. These investments will limit Signature's free
operating cash flow generation after lease payment to about 2%-3%
of debt, but should be accretive to EBITDA margins over time, as
rising business jet original equipment manufacturer backlogs
support demand for higher-margin hangar lease rental services.
These expenditures are ultimately discretionary and could be
reduced in the short-term, but we generally view Signature's
airport development capex as critical to its lease renewal
initiatives and the maintenance of its competitive advantage.
"The stable outlook reflects our expectation that healthy demand
for private air travel will support Signature's earnings growth
resulting in adjusted leverage declining to the low-6x area by
year-end 2022, from 7.1x at transaction close.
"We could lower the rating if Signature underperformed our
forecast, resulting in weaker FOCF than we expected, combined with
increasing leverage." In particular, S&P could lower the rating if
it expected:
-- Adjusted leverage will rise and remain sustainably above 7.5x;
-- Negligible FOCF after lease payments; or
-- The company's financial policy proves more aggressive than
expected, including large debt-funded returns to shareholders.
S&P could consider an upgrade if it believed adjusted debt to
EBITDA would fall and remain below 5.5x. An upgrade is contingent
on the owners' commitment to maintain a financial policy that would
support such improved ratios on a sustained basis.
ESG credit indicators: To E2, S2, G2; From E2, S3, G2
S&P said, "ESG factors have an overall neutral impact on our
ratings for Signature. Social factors are no longer a moderately
negative consideration in our credit rating analysis. While the
COVID-19 pandemic continues to impair air travel, the private jet
segment was only temporarily affected and has fully recovered to
2019 levels. Social-distancing measures and health concerns have
supported demand for private air services."
BROWNIE'S MARINE: Incurs $444K Net Loss in First Quarter
--------------------------------------------------------
Brownie's Marine Group, Inc. filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $444,092 on $1.97 million of total net revenues for the three
months ended March 31, 2022, compared to a net loss of $440,981 on
$950,769 of total net revenues for the three months ended March 31,
2021.
As of March 31, 2022, the Company had $4.92 million in total
assets, $2.20 million in total liabilities, and $2.72 million in
total stockholders' equity.
Chris Constable, CEO of Brownie's Marine Group, Inc., stated, "We
continue to grow across all business segments and are pleased so
far with our Q1-2022 results in comparison to where we were a year
ago. Our growth continues to be supercharged by our Blu3 division,
so much so, that we decided to front load into Q1 the investments
necessary to continue that pace of growth throughout the rest of
the year." Mr. Constable continued, "making those aggressive
expenditures in expanding brand recognition this quarter swung us
towards a small loss, but we think it's well worth it to facilitate
the pace of growth that we are having in that division in
particular."
Going Concern
Browne's Marine stated, "We have a history of losses, and an
accumulated deficit of $14,988,696 as of March 31, 2022. Despite a
working capital surplus of $1,702,817 at March 31, 2022, the
continued losses and cash used in operations raise substantial
doubt as to the Company's ability to continue as a going concern.
The Company's ability to continue as a going concern is dependent
upon the Company's ability to continue to increase revenues,
control expenses, raise capital, and continue to sustain adequate
working capital to finance its operations. The failure to achieve
the necessary levels of profitability and cash flows would be
detrimental to the Company. We are continuing to engage in
discussions with potential sources for additional capital, however,
our ability to raise capital is somewhat limited based upon our
revenue levels, net losses and limited market for our common stock.
If we fail to raise additional funds when needed, or if we do not
have sufficient cash flows from operations, we may be required to
scale back or cease certain of our operations."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1166708/000149315222015467/form10-q.htm
About Brownie's Marine
Headquartered in Pompano Beach, Florida, Brownie's Marine Group,
Inc., is the parent company to a family of innovative brands with a
unique concentration in the industrial, and recreational diving
industry. The Company, together with its subsidiaries, designs,
tests, manufactures, and distributes recreational hookah diving,
yacht-based scuba air compressors and nitrox generation systems,
and scuba and water safety products in the United States and
internationally. The Company has three subsidiaries: Trebor
Industries, Inc., founded in 1981, dba as "Brownie's Third Lung";
BLU3, Inc.; and Brownie's High-Pressure Services, Inc., dba LW
Americas. The Company is headquartered in Pompano Beach, Florida.
Brownie's Marine reported a net loss of $1.59 million for the year
ended Dec. 31, 2021, compared to a net loss of $1.35 million for
the year ended Dec. 31, 2020. As of Dec. 31, 2021, the Company had
$4.67 million in total assets, $2.05 million in total liabilities,
and $2.63 million in total stockholders' equity.
Boynton Beach, Florida-based Liggett & Webb, P.A., the Company's
auditor since 2018, issued a "going concern" qualification in its
report dated April 22, 2022, citing that the Company has
experienced net losses and has an accumulated deficit. These
factors raise substantial doubt about the Company's ability to
continue as a going concern.
BUCKHARDT TECHNOLOGIES: Wins Cash Collateral Access Thru July 2
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized Buckardt Technologies, Inc., dba
Konsultek, to use cash collateral on an interim basis in accordance
with the budget through July 2, 2022.
Prior to the Petition Date, the Debtor borrowed from BMO Harris
Bank. As of the Petition Date, the Debtor owed the Secured Lender
$381,719, including principal and interest.
The other potential lien holders are Funding Circle, Small Business
Administration, Internal Revenue Service, and Ingram Micro, Inc.
In return for the Debtor's continued interim use of cash
collateral, and for any diminution in value of the Prepetition
Secured Lender's interest in the cash collateral from and after the
Petition date, the Prepetition Secured Lender will receive an
administrative expense claim.
In further return for the Debtor's continued interim use of cash
collateral, the Prepetition Secured Lender is granted a replacement
lien in substantially all of the Debtor's assets.
The Prepetition Secured Lender and all other subordinate lien
holders are granted replacement liens, attaching to the Collateral,
but only to the extent of their prepetition liens and only to the
extent of priority that existed on the date of filing.
The liens granted will be valid, perfected, and enforceable without
any further action by the Debtor and/or the Prepetition Secured
Lender and need not be separately documented.
The further hearing on the matter is scheduled for June 30 at 11
a.m.
A copy of the order is available at https://bit.ly/398EFlF from
PacerMonitor.com.
About Buckardt Technologies, Inc.
Buckardt Technologies, Inc. is an information and security
technology consulting firm. Buckardt sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Cal. Case No.
22-04420) on April 18, 2022. In the petition signed by Judith A.
Buckardt, president, the Debtor disclosed up to $50,000 in assets
and up to $10 million in liabilities.
Judge Lashonda A. Hunt oversees the case.
Richard G. Larsen, Esq., at SpringerLarsenGreene, LLC is the
Debtor's counsel.
CARDINAL LOCAL SD: Moody's Upgrades Issuer & GOULT Ratings to Ba1
-----------------------------------------------------------------
Moody's Investors Service has upgraded to Ba1 from Ba2 the issuer
and general obligation unlimited tax (GOULT) ratings of Cardinal
Local School District, OH. The outlook has been revised to stable
from positive. The issuer rating reflects the district's ability to
repay debt and debt-like obligations without consideration of any
pledge, security, or structural features. The district currently
has $670,000 in outstanding GOULT debt.
RATINGS RATIONALE
The upgrade to Ba1 reflects the district's improved operating
performance which has contributed to a better financial profile,
though overall reserves and liquidity remain relatively narrow. The
rating also factors below average per capita wealth, average
resident incomes, declining student enrollment, an uneven election
history, and above average long-term leverage.
The Ba1 GOULT rating is equivalent to the issuer rating based on
the district's general obligation full faith and credit pledge as
well as an unlimited property tax that is dedicated to debt
service.
RATING OUTLOOK
The stable outlook reflects the district's improved financial
operations and moderate buildup of fund balance and liquidity. Near
term financial performance will be influenced by the results of a
November 2022 levy renewal, the passage of which could contribute
additional credit strengthening.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATINGS
- Stable to growing student enrollment trend
- Sustained strengthening of operating fund balance and liquidity
- Demonstrated voter support for new and renewed operating levies
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATINGS
- Pronounced, persistent declines to student enrollment
- Material narrowing to operating fund balance or liquidity
LEGAL SECURITY
Outstanding rated bonds are general obligations of the district
supported by its full faith and credit and pledge and authority to
levy ad valorem property taxes to pay debt service without limit as
to rate or amount.
PROFILE
Cardinal Local School District encompasses 85 square miles in
Geauga County (Aa1), approximately 35 miles southeast of the City
of Cleveland (A1 stable). It provides kindergarten through twelfth
grade education to just under 850 students within the village of
Middlefield and several surrounding towns.
METHODOLOGY
The principal methodology used in these ratings was US K-12 Public
School Districts Methodology published in January 2021.
CAREERBUILDER LLC: S&P Downgrades ICR to 'CCC', Outlook Negative
----------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on
CareerBuilder LLC to 'CCC' from 'B-'. The outlook is negative. In
addition, S&P lowered the rating on the senior secured debt to
'CCC+' from 'B+'. The recovery rating on this debt remains '2'.
The negative outlook reflects the risk that prolonged operating
challenges could cause the company to generate negative cash flows
and further drain liquidity, such that the company will be unable
to refinance its first-lien term loan prior to its maturity.
Elevated refinancing risks and weak liquidity associated with the
debt becoming current puts pressure on CareerBuilder to navigate an
increasingly uncertain business environment.
The downgrade and negative outlook reflect the increased risk that
the company will be unable to refinance its first-lien term loan
prior to its maturity. The first-lien term loan matures on July 31,
2023 ($175.6 million was outstanding as of March 31, 2022) and will
likely become current. The $50 million revolving credit facility
(undrawn as of March 31, 2022) matures on July 31, 2022. S&P said,
"We expect CareerBuilder will increasingly depend on cash from the
balance sheet ($63 million as of March 31, 2022) to finance
operations. Regardless of the company's existing liquidity
position, we estimate that internal sources will be insufficient to
service debt repayment and other expected uses in full over the
next 12 months without the company completing a refinancing,
meaningful maturity extension, or executing on a strategic
alternative such as potential asset sales. These factors support an
assessment of weak liquidity and unsustainable capital structure
that could lead the company to pursue a financial restructuring or
distressed exchange that we would view as equivalent to a
default."
S&P said, "We expect CareerBuilder's cash flow will remain under
pressure in 2022. The company continues to face operating
challenges, even as the labor market has largely recovered from the
COVID-19 pandemic. High turnover rates among its sales force have
limited the company's ability to generate more transaction-related
revenue. While we expect revenue and EBITDA to improve over the
next 12 months from significant declines in 2021, we do not expect
this will be sufficient to refinance the current capital structure
at par. The company will use cash on its balance sheet to fund
ongoing cash flow deficits and increased marketing spend for
growth. As a result, we expect the company will continue to have
free operating cash flow (FOCF) deficits until late 2022."
The negative outlook on CareerBuilder reflects the risk that
continued operating challenges will cause it to generate negative
cash flows and drain liquidity. The outlook also reflects the risk
that prolonged cash burn and capital market volatility will inhibit
its ability to refinance its first-lien term loan prior to
maturity.
S&P said, "We could lower our rating on CareerBuilder if we believe
the company will be unable to execute on its strategy and deplete
its liquidity sources, such that we anticipate a payment default or
a debt restructuring in the next six months. This could occur if
demand for job postings declines significantly due to a slowdown in
the labor market, resulting in lower subscription renewals and
transaction revenue. This could also occur if a combination of
increased competitive pressures in the company's job advertising
segment and lower growth in its other businesses keep FOCF
significantly negative, depleting surplus cash.
"We could raise our rating if the company is able to refinance its
first-lien term loan such that we view a payment default or
distressed exchange as unlikely over the next 12 months."
ESG credit indicators: E-2, S-2, G-3
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis of CareerBuilder, as it
is for most rated entities owned by private-equity sponsors. We
believe the company's highly leveraged financial risk profile
points to corporate decision-making that prioritizes the interests
of controlling owners. This also reflects private-equity sponsors'
generally finite holding periods and focus on maximizing
shareholder returns."
CARVER BANCORP: Steven Bussey Quits as Director
-----------------------------------------------
Steven C. Bussey, a member of the Boards of Directors of Carver
Bancorp, Inc. and Carver Federal Savings Bank, announced his
resignation from his positions with the company and the bank,
effective as of the close of business on May 31, 2022.
The Company stated there were no disagreements between Mr. Bussey
and the Company or the Bank.
The Boards of Directors of the Company and the Bank each appointed
Kenneth J. Knuckles as a member of the Finance and Audit Committee,
effective June 1, 2022.
About Carver Bancorp
Headquartered in New York, Carver Bancorp, Inc., is the holding
company for Carver Federal Savings Bank, a federally chartered
savings bank. The Company conducts business as a unitary savings
and loan holding company, and the principal business of the Company
consists of the operation of its wholly-owned subsidiary, Carver
Federal. Carver Federal was founded in 1948 to serve
African-American communities whose residents, businesses and
institutions had limited access to mainstream financial services.
The Bank remains headquartered in Harlem, and predominantly all of
its seven branches and four stand-alone 24/7 ATM centers are
located in low- to moderate-income neighborhoods.
Carver Bancorp reported a net loss of $3.89 million for the year
ended March 31, 2021, a net loss of $5.42 million for the year
ended March 31, 2020, and a net loss of $5.94 million for the year
ended March 31, 2019. As of Dec. 31, 2021, the Company had $722.81
million in total assets, $665.11 million in total liabilities, and
$57.70 million in total equity.
CHICK LUMBER: Seeks Cash Collateral Access Thru Sept 2022
---------------------------------------------------------
Chick Lumber, Inc. asks the U.S. Bankruptcy Court for the District
of New Hampshire for authority to use up to $1,943,247 of cash
collateral to pay post-petition costs and expenses incurred in the
ordinary course of business to the extent provided for in the
budget during the period between July 1 to September 30, 2022.
Based on a UCC Lien Report and the Debtor's books of account and
business records, the Debtor concluded preliminarily that only BFG
Corporation and Amex Bank hold or may hold a lien on or interest in
the cash collateral.
The Debtor says adequate protection payments will be made only to
the Cash Collateral Record Lienholders and the other secured
creditors named in the Budget that hold Record Liens on property
that the Debtor plans to retain. The Debtor decided preliminarily
not to treat these Record Lienholders and other creditors known to
assert a lien on cash collateral as Cash Collateral Record
Lienholders:
-- RBS Citizens, N.A. (no effective Financing Statement);
-- Herget Building Supply (no Financing Statement); and
-- Great American Financial Services Corporation and Merchant
Cash and Capital, LLC (Corporation Service Company, Financing
Statement Agent), both of which were paid in full according to the
Debtor's books of account.
As adequate protection for the Debtor's use of cash collateral, the
Debtor will make these adequate protection payments on or before
the last day of each month during the Use Term:
(i) $482 to Jeldwen, Inc.;
(ii) $25 to BFG Corporation (H2H NC Paint Tinter);
(iii) $38 to Great America Financial Services Corp.;
(iv) $0.00 to Citizens One Auto Finance;
(v) $227 to Citizens One Auto Finance;
(vi) $212 to Citizens One Auto Finance;
(vii) $40 to Wells Fargo Equipment Finance, Inc. -- Forklift;
(viii) $63 to Wells Fargo Equipment Finance, Inc. -- Moffett
Machine;
(ix) $82 to Hitachi Capital Financial; and
(x) $1,198 to an Escrow account for Citizens Financial Group,
Inc. and American Express Bank, FSB.
The Debtor satisfied the claim secured by the Record Lien held by
Ford Motor Credit during January 2022.
The Debtor will grant all Record Lienholders with valid, binding,
enforceable and automatically perfected liens on the Debtor's
postpetition property of the same kinds, types and description in,
to and on which a Record Lienholder held valid and enforceable,
perfected liens on the Petition Date.
The Proposed Order includes a "winding down" proviso under which
the Court reserves the right to enter further orders as may be
necessary regarding the use of cash collateral to provide for
payment of any administrative claims for wage and trade creditors
who have supplied goods or services to the debtor during the period
of operation under the order (and any stipulation) which remain
unpaid at the time of termination of authorized cash collateral
usage, and which goods or services have created additional
collateral for the secured claimant.
A copy of the motion is available at https://bit.ly/3xd6S3T from
PacerMonitor.com.
About Chick Lumber
Chick Lumber, Inc. -- https://www.chicklumber.com/ -- is a dealer
of lumber, plywood, steel beams, engineered wood, trusses, steel
and asphalt roofing, windows, doors, siding, trim, stair parts, and
finish materials. It also offers drafting and design, installation,
delivery, outside sales, and plan reading and estimating services.
The Debtor sought Chapter 11 protection (Bankr. D.N.H. Case No.
19-11252) on Sept. 9, 2019, in Concord. In the petition signed by
Salvatore Massa, president, the Debtor disclosed between $1 million
and $10 million in both assets and liabilities.
Judge Bruce A. Harwood oversees the case.
William S. Gannon PLLC is the Debtor's legal counsel.
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on Oct. 3, 2019. The Committee is represented by
Goldstein & McClintock, LLLP as its legal counsel.
CINEMA SQUARE: Court Oks Wilmington Trust Cash Collateral Deal
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Northern Division, approved the stipulation between Cinema Square,
LLC and Wilmington Trust, National Association, as Trustee, for the
benefit of the Holders of COMM 2016-DC2 Mortgage Trust Commercial
Mortgage Pass Through Certificates, Series 2016-DC2, authorizing
the Debtor to use cash collateral.
As previously reported by the Troubled Company Reporter, the
parties agree that the Debtor may continue using cash collateral
until the earlier of September 30, 2022, or entry of an order
dismissing the case, or until termination as set forth in paragraph
9 of the Cash Collateral Stipulation dated June 22, 2021.
All other terms and conditions of the Cash Collateral Stipulation
remains unchanged.
A copy of the order is available at https://bit.ly/3th5Otz from
PacerMonitor.com.
About Cinema Square, LLC
Cinema Square, LLC is the owner of a small shopping center located
at 6917 El Camino Real, Atascadero, CA 93422. There are several
tenants, the primary tenant is a movie theater, the Galaxy
Theater.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 21-10634) on June 14,
2021. In the petition signed by Jeffrey C. Nelson, president, the
Debtor disclosed up to $50 million in assets and up to $10 million
in liabilities.
Judge Deborah J. Saltzman oversees the case.
William C. Beall, Esq., at Beall & Burkhardt, APC is the Debtor's
counsel.
CLEARWATER COLLECTION: Bid to Use Cash Collateral Denied
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado denied as
moot the Motion for Interim Authority to Use Cash Collateral filed
by Clearwater Collection 15, LLC and Clearwater Plainfield 15, LLC
on April 29, 2022.
At the Evidentiary Hearing via Zoom on June 2, the Court confirmed
the May 27 withdrawal of the Debtors' Motion to Compel Receiver to
Comply with Bankruptcy Code Section 543 filed April 29. Having
received no objection, the Court granted the Motion to Excuse
Receiver from Compliance with 11 U.S.C. Sec. 543(b) filed by RSS
WFCM 2015-LC22-FL, LLC on May 11. Therefore, the Court ruled that
the Debtors' Motion for Interim Authority to Use Cash Collateral
filed April 29 is denied as moot.
The Court set an objection deadline of 12:00 PM (MT) on June 8,
2022, on RSS WFCM 2015-LC22-FL CC15, LLC's motion/stipulation for
relief from stay. The Court set a hearing on the motion/stipulation
for relief from stay at 1:00 PM (MT) on June 9, 2022, in Courtroom
B, by Zoom.
As previously reported by the Troubled Company Reporter, the
Debtors sought authority to use cash collateral to pay the
necessary operating expenses of the Debtors' shopping center.
The Debtors maintain a secured loan whose lien arising therefrom
could encumber the Debtor's "cash collateral" as the term is
defined in Bankruptcy Code section 363. The lien is generally
described as: RSS WFCM 2015-LC22-FL CC15, LLC, successor to Rialto
Capital, pursuant to pursuant to a loan agreement dated on August
12, 2015. On September 29, 2020, the Bank filed its UCC-1 asserting
a lien on substantially all assets of the Debtor.
The Bank asserts it is owed approximately $17,500,000. The Debtors
dispute this amount.
A copy of the order is available at https://bit.ly/3Q2Vn6E from
PacerMonitor.com.
About Clearwater Collection 15, LLC
Clearwater Collection 15, LLC is an 82.52% owner of a shopping
center located at 21688 Highway 19 N, Clearwater, FL 3376.
Clearwater Plainfield 15, LLC is the other owner.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Colo. Case No. 22-11320) on April 18,
2022. In the petition signed by Gary Dragul, president, GDA
Clearwater Management and GDA Real Estate Management.
Judge Joseph G. Rosania Jr. oversees the case.
Aaron A. Garber, Esq., at Wadsworth Garber Warner Conrardy, P.C. is
the Debtor's counsel.
COGENT COMMUNICATIONS: Moody's Rates $450MM Unsecured Notes 'B3'
----------------------------------------------------------------
Moody's Investors Service has assigned a B3 rating to Cogent
Communications Group, Inc.'s announced $450 million senior
unsecured notes due 2027. The net proceeds from this offering will
be primarily used to finance the redemption of all outstanding
existing unsecured notes, with any remaining proceeds used for
general corporate purposes and/or to repurchase Cogent's common
stock or to pay special or recurring dividends to its
stockholders.
Assignments:
Issuer: Cogent Communications Group, Inc.
Senior Unsecured Regular Bond/Debenture, Assigned B3 (LGD5)
RATINGS RATIONALE
Pro forma for the transaction, Moody's expects limited impact to
leverage (including Moody's adjustments) for the latest 12 months
ending March 31, 2022. Moody's expects leverage to fall below 5x by
year end 2022 supported by continued steady revenue growth and
margin expansion.
Cogent has a simple strategy that focuses primarily on selling high
speed internet access to on-net customers, typically by leasing
dark fiber between its network and its customers' locations, with
limited pursuit of off-net solutions for specific customer needs.
Cogent's focus on internet service allows for a streamlined cost
structure and uniform network architecture. Technology trends
continue to be favorably aligned with Cogent's architecture, as
enterprise and net-centric customers' networking and transit needs
still remain heavily reliant upon dedicated internet access. Older,
complex network IT architectures face obsolescence risks in favor
of low cost IP networks. This trend continues to benefit Cogent and
will continue to support its growth.
The stable outlook is based on Moody's view that while Cogent's
earnings and cash flow will continue to grow, equity stakeholder
returns – in the form of dividends and share buybacks -- will
increase in tandem. Moody's expects the company will maintain
sufficient liquidity while debt levels remain relatively constant.
Cogent's low cost structure and niche sales approach, in
conjunction with its aggressive equity stakeholder return policy,
will prevent the company from generating meaningful positive free
cash flow for the near future.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
Moody's could upgrade Cogent's ratings if leverage is sustained
below 4x (Moody's adjusted) and free cash flow is positive. Moody's
could downgrade Cogent's ratings if leverage is sustained above 5x
(Moody's adjusted) or if liquidity weakens or fails to improve.
Cogent Communications Holdings, Inc., with headquarters in
Washington, DC, is a multinational Tier 1 internet service
provider. The company offers dedicated internet access and data
transport over its fiber optic, IP network to corporate and
net-centric customers. Cogent is among the top five largest
carriers of internet traffic in the world.
The principal methodology used in this rating was Communications
Infrastructure published in February 2022.
COGENT COMMUNICATIONS: S&P Rates New $450MM Sr. Unsec. Notes 'B'
----------------------------------------------------------------
S&P Global Ratings assigned its 'B' issue-level and '5' recovery
ratings to Washington, D.C.-based high-speed internet service
provider Cogent Communications Group Inc.'s proposed $450 million
senior secured notes due 2027. The '5' recovery rating indicates
our expectation for modest (10%-30%; rounded estimate: 15%)
recovery in the event of a payment default. Cogent will use the
proceeds from these notes to redeem its €350 million (about $375
million) of 4.375% senior unsecured notes due 2024. S&P expects any
remaining proceeds will be used for general corporate purposes,
which could include special or recurring dividends to
shareholders.
S&P said, "Despite the increase in debt, we believe the recovery
prospects for Cogent's existing secured lenders are not affected by
the transaction. As part of our recovery analysis, we increased the
company's default valuation to about $630 million from about $600
million, on solid business growth over the past 12 months (reported
EBITDA growth of 7%), which outpaced our previous estimate.
"Our 'B+' issuer credit rating and stable outlook on Cogent are
unchanged. While we expect the company's S&P Global
Ratings-adjusted gross leverage to increase slightly to about 5.3x
from 5.1x as of March 31, 2022, we expect it to reduce leverage to
5x by the end of the year, which is below the 5.25x threshold for
the rating. Our base-case forecast assumes mid- to
high-single-digit percent EBITDA growth supported by 3%-5% top-line
growth and continued gross margin expansion."
Issue Ratings--Recovery Analysis
Key analytical factors
-- S&P's simulated default scenario envisions increased
competition from broadband and transport service providers that
leads to price compression despite the company's volume growth.
These factors contribute to lower profit margins that ultimately
strain its liquidity and lead to a payment default.
-- S&P said, "We have valued the company on a going-concern basis
using a 5.5x multiple of our projected emergence EBITDA. Generally,
we use a multiple of 5x-6x for fiber infrastructure companies. Our
default EBITDA multiple estimate is based on the company's
ownership of the majority of its fiber under long-term indefeasible
rights-of-use agreements, which we view more favorably than
short-term leases. That said, Cogent derives most of its revenue
from long-haul traffic, which we view less favorably than metro
fiber service providers."
Simulated default assumptions
-- Simulated year of default: 2026
-- EBITDA at emergence: $115 million
-- EBITDA multiple: 5.5x
Simplified waterfall
-- Net enterprise value (after 5% administrative costs): $600
million
-- Valuation split (obligors/nonobligors): 78%/22%
-- Collateral value available to secured creditors: $554 million
-- Senior secured debt: $509 million
--Recovery expectations: 90%-100% (rounded estimate: 95%)
-- Total value available to unsecured claims: $91 million
-- Senior unsecured debt and pari passu claims: $460 million
--Recovery expectations: 10%-30% (rounded estimate: 15%)
Note: All debt amounts include six months of prepetition interest.
COINBASE: CLO Says Crypto Assets Safe From Bankruptcy
-----------------------------------------------------
Biorepwatch reports that after confidence in the major
cryptocurrency exchange Coinbase has plummeted recently, chief
legal officer Paul Grewal is now confirming that investor funds are
safe on the trading platform.
In May it was from the documents of the US Securities and Exchange
Commission SEC appeared, that users' crypto assets stored on
Coinbase "may be considered as part of bankruptcy ownership in the
event of bankruptcy proceedings." Cryptocurrency exchange clients
will automatically become "uninsured creditors."
This information received special attention after Coinbase reported
losses of $430 million in the first quarter of 2022 and a 27%
year-over-year decline in revenue. In addition, the value of
Coinbase's bonds dropped significantly at the same time.
All of these developments were quickly left on social media rumors
about the possible bankruptcy of a US cryptocurrency exchange,
which is why CLO Grewal felt compelled to do so yesterday to
clarify that investors' money would be safe anyway.
As Grewal says, the trading platform has also changed its terms and
conditions for private investors so that they have the same
protections in the event of bankruptcy as institutional investors.
At the same time, the chief legal officer reiterates that the
crypto company does not handle users' funds in any way unless they
give their explicit consent. This includes both crypto-asset
lending for lending or any other commercial activities undertaken
by traditional banks.
In addition to Writes Grewal tweeted that the cryptocurrency
exchange is "financially strong" with more than $6 billion in
assets, so the alleged bankruptcy is just "panic."
Co-founder and CEO Brian Armstrong had previously commented on the
speculation. The CEO also emphasized that there is "no risk of
bankruptcy" for Coinbase and that the wording in question is just a
standard requirement of the SEC. In any case, users will be
legally protected.
About Coinbase Global
Coinbase Global, Inc., branded Coinbase, is an American company
that operates one of the largest online cryptocurrency exchanges in
the world. Coinbase is building the cryptoeconomy -- a more fair,
accessible, efficient, and transparent financial system enabled by
crypto. The company started in 2012 with the radical idea that
anyone, anywhere, should be able to easily and securely send and
receive Bitcoin. Today, Coinbase offers a trusted and easy-to-use
platform for accessing the broader cryptoeconomy.
COLORTEK COLLISION: Files Emergency Bid to Use Cash Collateral
--------------------------------------------------------------
Colortek Collisions and Customs Inc. asks the U.S. Bankruptcy Court
for the Eastern District of North Carolina, Fayetteville Division,
for authority to use cash collateral on an emergency basis in
accordance with the proposed budget until June 30, 2022.
The Debtor requires the use of cash collateral to continue its
ongoing operations.
The bankruptcy estate has an interest in revenues from the
operation of its business. This revenue may constitute the cash
collateral of certain creditors within the meaning of section 363
of the Bankruptcy Code.
The Debtor is aware of these possible lienholders of its cash
collateral:
Method of
Creditor Perfection Filing Date Balance owed
-------- ---------- ----------- ------------
FC Marketplace UCC 8/9/2018 $55,037
FC Marketplace UCC 3/29/2019 $28,348
SBA (Truist
Truist Bank) UCC 5/30/2020 $62,000
The Debtor proposes adequate protection to the Secured Creditors in
the form of replacement liens in after-acquired revenue to the same
extent as they had prior to the bankruptcy.
The Debtor also requests the Court to schedule a hearing for June
9, 2022 at 1 p.m.
A copy of the order and the Debtor's June 2022 budget is available
at https://bit.ly/3tedmNM from PacerMonitor.com.
The Debtor projects $45,800 in total available cash and $36,699 in
total expenses.
About Colortek Collisions and Customs Inc.
Colortek Collisions and Customs Inc. operates an autobody shop in
Lindon, North Carolina. The Debtor sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. E.D.N.C. Case No.
22-01178-5-PWM) on June 1, 2022. In the petition signed by Stephen
Beasley, president, the Debtor disclosed up to $500,000 in both
assets and liabilities.
Travis Sasser, Esq., at Sasser Law Firm is the Debtor's counsel.
CONNECT TRUCKING: Files Chapter 11 Subchapter V Case
----------------------------------------------------
Connect Trucking, LLC, has sought bankruptcy protection in the
Middle District of Tennessee. The company filed as a small
business debtor seeking relief under Subchapter V of Chapter 11 of
the Bankruptcy Code.
According to court documents, Connect Trucking LLC estimates
between 1 and 49 unsecured creditors. The petition states that
funds will be available to unsecured creditors.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for June 30, 2022 at 10:30 A.M.
About Connect Trucking
Connect Trucking, LLC, is a licensed and bonded freight shipping
and trucking company running freight hauling business from
Nashville, Tennessee.
Connect Trucking sought protection under Subchapter V of Chapter 11
of the U.S. Bankruptcy Code (Bankr. M.D. Tenn Case No. 22-01713) on
May 31, 2022. In the petition filed by Eric Jordan, owner, Connect
Trucking estimated assets up to $50,000 and liabilities between
$100,000 and $500,000.
The case is overseen by Honorable Bankruptcy Judge Marian F.
Harrison.
Steven L. Fefrovitz, of LEFKOVITZ AND LEFKOVITZ, PLLC, is the
Debtor's counsel.
Glen Coy Watson has been appointed as the Subchapter V trustee.
CREATD INC: Closes $4 Million Private Placement
-----------------------------------------------
Creatd, Inc. has closed its previously discussed private placement
with an aggregate principal amount of $4 million.
This financing was executed concurrently with the ongoing review by
the Securities and Exchange Commission of the Company's
registration statement for its previously announced $40MM Rights
Offering. Based on the SEC review, the Company will announce the
record date for and commence said Rights Offering in the coming
weeks.
Pursuant to the Rights Offering, the Company intends to distribute
two subscription rights for each share of common stock or share
which may be acquired via conversion or exercise of preferred
stock, warrants, or options. Each subscription right would entitle
the holder to purchase one Unit at a subscription price of $2.00
per Unit. Each Unit would consist of: (i) one share of common
stock, (ii) one publicly tradable 5-year warrant exercisable for $3
per share, and (iii) one publicly tradable 5-year warrant
exercisable for $6 per share. The Company wishes to clarify that
both warrants are publicly tradable.
The aforementioned Rights Offering is to be made pursuant to the
Company's registration statement on Form S-1, which has not yet
been declared effective by the SEC. The prospectus relating to and
describing the terms of the Rights Offering has been filed with the
SEC on May 27, 2022, and is available on the SEC's website at EDGAR
Entity Landing Page (sec.gov).
About Creatd Inc.
Headquartered in Fort Lee, NJ, Creatd, Inc. -- https://creatd.com
-- is a company whose mission is to provide economic opportunities
to creators by multiplying the impact of platforms, people, and
technology. The Company operates four main business segments:
Creatd Labs, Creatd Partners, Creatd Ventures, and Creatd Studios.
Creatd reported a net loss of $37.38 million for the year ended
Dec. 31, 2021, compared to a net loss of $24.21 million for the
year ended Dec. 31, 2020. The Company reported a net loss of $8.04
million for the year ended Dec. 31, 2019. As of March 31, 2022,
the Company had $9.34 million in total assets, $6.23 million in
total liabilities, and $3.11 million in total stockholders' equity.
CURO GROUP: S&P Affirms 'B-' Issuer Credit Rating, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings affirmed its 'B-' issuer credit rating on Curo
Group Holdings Corp. The outlook remains stable.
S&P said, "At the same time, we affirmed our 'CCC+' rating on the
company's senior secured notes. The recovery rating remains '5',
indicating our expectation of modest recovery (10%-30%, rounded
estimate: 10%) in a simulated default scenario.
"We affirmed our 'B-' rating on Curo after the company announced it
would sell its legacy U.S. direct lending business and acquire
First Heritage Credit. On May 19, 2022, Curo entered in a
definitive agreement to sell its legacy U.S. direct lending
business for $345 million and acquire First Heritage Credit, a
near-prime consumer lender, for $140 million. Upon closing, almost
half of Curo's pro forma U.S. loan portfolio will have annual
percentage rates of 36% and below, with no remaining exposure to
single-pay loans, which we view favorably. The pro forma U.S.
direct lending business will have about 509 branches across 13
Southern and Midwestern states. First Heritage's core product
includes near-prime consumer loans of $1,000-$5,000 with terms of
18-36 months.
"Despite ongoing state regulations that limit interest rates
charged by consumer finance companies, we expect Curo to be better
positioned post-transaction than other companies that rely on
short-term payday loans. While Curo will continue to have
regulatory exposure, we believe it is better positioned with its
receivable composition than other high-cost, short-term lenders. As
a result, we are revising Curo's business risk position to weak
from vulnerable.
"The announced transaction will likely weaken the company's
earnings in 2022.For the first quarter of 2022, Curo's EBITDA
interest coverage was 1.6x. We expect the transaction will likely
weaken this metric, as the legacy U.S. direct lending business was
more profitable than First Heritage. For the 12 months ended March
31, 2022, the legacy U.S. direct lending business generated $329
million of net revenue, compared with $90 million for First
Heritage. In addition, earnings and profitability could be
negatively impacted by weakening consumer credit quality or further
interest rate hikes. As with most acquisitions, there is also some
integration risk. While earnings will likely be pressured over the
next few quarters, we expect Curo's earnings and interest coverage
to stabilize starting in 2023 as its loan book continues to grow
and Flexiti (a point-of-sale lender that Curo acquired in 2021)
becomes profitable. The expected weakening in earnings is also
somewhat offset by the less risky nature of the company's U.S. loan
portfolio post-transaction, in our view.
"We expect Curo to maintain adequate liquidity.Pro forma, Curo will
have over $300 million of available liquidity, composed of
unrestricted cash and undrawn capacity on revolving credit
facilities and borrowing base levels. This amount includes the
sizable net cash gain from the announced transaction.
"The stable outlook reflects our view that over the next 12 months,
Curo will maintain EBITDA interest coverage of 1.0x-2-0x and have
no material integration risk related to its acquisition. We also
believe the company will have adequate liquidity, sufficient
covenant cushion, and no imminent refinancing risk.
"We could lower the ratings over the next 12 months if EBITDA
interest coverage is sustained below 1.0x, Curo faces material
integration risk related to its acquisition, liquidity weakens
materially, regulatory changes significantly impact the company's
business, or the covenant cushion meaningfully erodes. We could
also lower the ratings if the company buy backs debt at distressed
levels, which we could view as de facto restructuring tantamount to
default."
An upgrade is unlikely over the next 12 months.
CVENT INC: Moody's Withdraws 'B1' CFR Following Debt Repayment
--------------------------------------------------------------
Moody's Investors Service has withdrawn all of its ratings for
Cvent, Inc. including the B1 Corporate Family Rating and B1-PD
Probability of Default Rating.
The following ratings/assessments are affected by the action:
Ratings Withdrawn:
Issuer: Cvent, Inc.
Corporate Family Rating, Withdrawn, previously rated B1
Probability of Default Rating, Withdrawn, previously rated B1-PD
Speculative Grade Liquidity Rating, Withdrawn, previously rated
SGL-1
Senior Secured Bank Credit Facility, Withdrawn, previously rated
B1 (LGD3)
Outlook Actions:
Issuer: Cvent, Inc.
Outlook, Changed To Rating Withdrawn From Stable
RATINGS RATIONALE
Moody's has withdrawn the ratings due to the obligations being
redeemed following a privately placed refinancing transaction.
Cvent, based in Tyson's Corner, VA and publicly traded but
controlled by Vista, provides cloud-based enterprise event
management software and services to marketers, event and meeting
planners and venues, mostly in North America.
CYTODYN INC: Reports Unregistered Sales of Equity Securities
------------------------------------------------------------
CytoDyn Inc. disclosed with the Securities and Exchange Commission
that, as of May 24, 2022, its unregistered sales of equity
securities that were not previously reported, in the aggregate,
exceeded 1% of the shares of its Common Stock outstanding as of May
23, 2022.
Private Placement of Common Stock and Warrants through Placement
Agent
As of May 31, 2022, the Company has received binding subscription
agreements for an estimated total of approximately 34.6 million
units from accredited investors in a private offering through a
placement agent. Each unit consists of one share of Common Stock
and three-quarters of a warrant to purchase one share of Common
Stock. The warrants will have a five-year term and will be
exercisable in full when issued.
The aggregate gross proceeds received under the executed
subscription agreements as of May 31, 2022, are $8,834,500. The
final purchase price per unit and the exercise price of the
warrants will be equal to 85% of the intraday volume weighted
average price of the Common Stock on April 29, 2022, or the date of
the final closing of the Offering, whichever is lower.
Pursuant to the subscription agreements, the Company has agreed to
use commercially reasonable efforts to prepare and file with the
Securities and Exchange Commission, and cause the SEC to declare
effective, within 90 days following the final closing of the
Offering, a registration statement under the Securities Act
covering the resale of all of the shares and warrants to purchase
shares of Common Stock sold in the Offering.
As a fee to the placement agent, the Company has agreed to pay a
cash fee equal to 13% of the gross proceeds received from qualified
investors in the Offering, as well as a one-time non-accountable
expense fee of $50,000 in the aggregate for all closings in the
Offering. The Company also agreed to issue to the placement agent
or its designees warrants with a 10-year term to purchase 13% of
the total number of shares of Common Stock, including shares
subject to warrants, sold to qualified investors in the Offering.
The Company is relying on the exemption provided by Rule 506 of
Regulation D and Section 4(a)(2) of the Securities Act in
connection with the Offering.
Issuance of Shares to Former Executive Officer
The Company issued to a former executive officer a total of 23,651
shares of Common Stock to satisfy its obligation to make a
severance payment of $8,042 for the payroll period ended May 15,
2022, net of payroll deductions and withholding taxes. The number
of shares issued was based on the closing price of the Common Stock
on that date. The Company relied on the exemption from
registration afforded by Section 4(a)(2) of the Securities Act in
connection with the issuance of the shares.
About CytoDyn Inc.
Headquartered in Vancouver, Washington, CytoDyn Inc. --
http://www.cytodyn.com-- is a late-stage biotechnology company
focused on the clinical development and potential commercialization
of leronlimab (PRO 140), a CCR5 antagonist to treat HIV infection,
with the potential for multiple therapeutic indications.
Cytodyn reported a net loss of $154.67 million for the year ended
May 31, 2021, compared to a net loss of $124.40 million for the
year ended May 31, 2020. As of Nov. 30, 2021, the Company had
$103.70 million in total assets, $116.40 million in total
liabilities, and a total stockholders' deficit of $12.70 million.
Birmingham, Alabama-based Warren Averett, LLC, the Company's
auditor since 2007, issued a "going concern" qualification in its
report dated July 30, 2021, citing that the Company incurred a net
loss of approximately $154,674,000 for the year ended May 31, 2021
and has an accumulated deficit of approximately $511,294,000
through May 31, 2021, which raises substantial doubt about its
ability to continue as a going concern.
CYTOSORBENTS CORP: Transfers Headquarters to Princeton, N.J.
------------------------------------------------------------
Effective June 1, 2022, CytoSorbents Corporation moved its
headquarters and principal place of business to 305 College Road
East, Princeton, N.J.
About CytoSorbents
Based in Monmouth Junction, New Jersey, CytoSorbents Corporation is
engaged in critical care immunotherapy, specializing in blood
purification. Its flagship product, CytoSorb, is approved in the
European Union with distribution in more than 70 countries around
the world as an extracorporeal cytokine adsorber designed to reduce
the "cytokine storm" or "cytokine release syndrome" seen in common
critical illnesses that may result in massive inflammation, organ
failure and patient death.
Cytosorbents reported a net loss of $24.56 million for the year
ended Dec. 31, 2021, a net loss of $7.84 million for the year
ended
Dec. 31, 2020, a net loss of $19.26 million for the year ended Dec.
31, 2019, and a net loss of $17.21 million for the year ended Dec.
31, 2018. As of March 31, 2022, the Company had $83.27 million in
total assets, $27.84 million in total liabilities, and $55.43
million in total stockholders' equity.
DAYBREAK OIL: Needs More Time to File Form 10-K
-----------------------------------------------
Daybreak Oil and Gas, Inc. filed a Form 12b-25 with the Securities
and Exchange Commission with respect to its Annual Report on Form
10-K for the year ended Feb. 28, 2022.
Daybreak Oil was unable to file, without unreasonable effort and
expense, its Annual Report because it needs additional time to
complete a final review of its financial statements and other
disclosures in the Form 10-K. The Company currently expects to
file the Form 10-K within the fifteen-day extension period provided
under Rule 12b-25 of the Securities Exchange Act of 1934, as
amended.
About Daybreak
Daybreak Oil and Gas, Inc. is an independent crude oil and natural
gas company currently engaged in the exploration, development and
production of onshore crude oil and natural gas in the United
States. The Company is headquartered in Spokane Valley, Washington
with an operations office in Friendswood, Texas. Daybreak owns a
3-D seismic survey that encompasses 20,000 acres over 32 square
miles with approximately 6,500 acres under lease in the San Joaquin
Valley of California. The Company operates production from 20 oil
wells in our East Slopes project area in Kern County, California.
Daybreak reported a net loss of $512,265 for the 12 months ended
Feb. 28, 2021, compared to a net loss of $754,644 for the 12 months
ended Feb. 29, 2020.
Houston, Texas-based MaloneBailey, LLP, the Company's auditor since
2006, issued a "going concern" qualification in its report dated
May 27, 2021, citing that the Company has suffered recurring losses
from operations and has a net capital deficiency that raises
substantial doubt about its ability to continue as a going concern.
DEPENDABLE MACHINE: Case Summary & Six Unsecured Creditors
----------------------------------------------------------
Debtor: Dependable Machine Company, Inc.
1846 E. 30th Street
Indianapolis, IN 46218
Business Description: Dependable Machine is a provider of
precision machining services.
Chapter 11 Petition Date: June 7, 2022
Court: United States Bankruptcy Court
Southern District of Indiana
Case No.: 22-02191
Judge: Hon. James M. Carr
Debtor's Counsel: Jeffrey Hester, Esq.
HESTER BAKER KREBS LLC
One Indiana Sq Suite 1330
Indianapolis, IN 46204
Tel: 317-833-3030
Email: jhester@hbkfirm.com
Total Assets: $2,189,630
Total Liabilities: $3,007,363
The petition was signed by Cory Lowe, owner.
A full-text copy of the petition containing, among other items, a
list of the Debtor's six unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/BCH32RA/Dependable_Machine_Company_Inc__insbke-22-02191__0001.0.pdf?mcid=tGE4TAMA
DIOCESE OF CAMDEN: Unsecureds Owed $1.5M to Get 75% Dividend
------------------------------------------------------------
The Diocese of Camden, New Jersey, submitted an Eighth Amended
Disclosure Statement.
The Plan classifies Abuse Claims into two classes: Class 5 Abuse
Claims Other Than Unknown Abuse Claims, and Class 6 Unknown Abuse
Claims. All Abuse Claims are classified into Class 5 unless the
claim was not filed by the Bar Date and is held by an individual
meeting certain criteria such that the individual was not required
to file a claim prior to the Bar Date.
The Plan proposes to create a Trust to fund payments for Class 5
and Class 6 Claims pursuant to the guidelines in the Plan and Trust
Agreement. The Trust will be funded by $87,500,000 in cash from
the Debtor and Other Catholic Entities. As of the date of this
Disclosure Statement, 324 non-duplicative Class 5 Claims have been
filed, which will share collectively in the funds contributed to
the Trust in accordance with the Trust Distribution Protocols. In
exchange for this contribution, the Plan proposes that the Abuse
Claims against the Diocese and the Other Catholic Entities, other
than accused perpetrators of Abuse, will be channeled to the Trust
and released in accordance with the terms of the Plan and the Trust
Distribution Protocols, and all currently pending and future causes
of action against these parties will be forever barred.
Notwithstanding the foregoing, Abuse Claims will not be released or
enjoined against the Covered Parties for any Abuse that may be
covered under Non-Settling Insurer Policies until such claims are
settled with the Covered Parties and their Non-Settling Insurers,
or are fully adjudicated, resolved, and subject to Final Order.
In addition to the Diocese and Other Catholic Entity contribution,
the Plan provides that the proceeds of the Diocese's insurance
policies shall be assigned to the Trust for the benefit of Holders
of Class 5 and Class 6 Claims. The Trust will then have the
responsibility for litigating the claims against the Non-Settling
Insurers at its sole cost and expense. There is no guarantee that
the Trust will be successful in this litigation in light of the
defenses that the insurance companies assert they have to these
claims.
Under the Plan, Class 3 General Unsecured Claims total $1,500,000.
The Diocese shall pay Allowed Class 3 Claims a 75% dividend within
5-years, payable as follows:
* A 15% payment shall be made upon the later of: (i) 60 days of
the Effective Date; or (ii) 15 days of the determination of a Claim
being an Allowed Claim, as applicable;
* On the first anniversary of the Effective Date, a 15% payment
shall be made;
* On the second anniversary of the Effective Date, a 15% payment
shall be made;
* On the third anniversary of the Effective Date, a 15% payment
shall be made;
* On the fourth anniversary of the Effective Date, a final 15%
payment shall be made.
Allowed Class 3 Claimants shall have the option to forego the 75%
payment within 5-years and instead elect to receive a payment of
50% of their Allowed Claim in full satisfaction of their Allowed
Claim upon the later of: (i) 60 days after the Effective Date; or
(ii) 5 business days after the Claim is deemed Allowed, as
applicable. Such election may be made through the Ballot or
otherwise in writing to Debtor's counsel within 20 days of
Confirmation. Class 3 is impaired.
Effective as of the date the Confirmation Order is entered, the
Trust shall be established in accordance with the Trust Documents
for the purposes of assuming liability of Covered Parties and
Settling Insurers for Channeled Claims and receiving, liquidating
and distributing Trust Assets in accordance with the Plan and the
Trust Distribution Plan.
The Trust shall be funded with: (i) $87.5 million by the Debtor and
the Other Catholic Entities; (ii) any proceeds held by the Debtor
or the Reorganized Debtor on account of Insurance Settlement
Agreements as set forth in this Section 7.2; and (iii) the
Transferred Insurance Interests.
Counsel to The Diocese of Camden, New Jersey:
Richard D. Trenk, Esq.
Robert S. Roglieri, Esq.
TRENK ISABEL SIDDIQI & SHAHDANIAN P.C.
290 W. Mt. Pleasant Ave., Suite 2350
Livingston, NJ 07039
Telephone: (973) 533-1000
E-mail: rtrenk@trenkisabel.law
rroglieri@trenkisabel.law
Counsel to the Official Committee of Tort Claimant Creditors:
Jeffrey D. Prol, Esq.
Michael A. Kaplan, Esq.
Brent Weisenberg, Esq.
LOWENSTEIN SANDLER LLP
One Lowenstein Drive
Roseland, NJ 07068
Telephone: (973) 597-2500
Email: jprol@lowenstein.com
mkaplan@lowenstein.com
bweisenberg@lowenstein.com
A copy of the Disclosure Statement dated June 1, 2022, is available
at https://bit.ly/3Q1rl2U from Kroll, the claims agent.
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.
DOMUS BWW: Seeks to Hire Gateley Plc as English Insolvency Counsel
------------------------------------------------------------------
Domus BWW Funding, LLC seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Pennsylvania to hire Gateley Plc
as its special English insolvency counsel.
The firm's services include:
(a) finalizing negotiation and implementation of a settlement
with the joint administrators of BridgeStreet Accommodations London
Limited with respect to the dispute between the Debtor and the
administrators regarding:
i. the validity of the Debtor's guarantee claim against
BridgeStreet and the security granted by BridgeStreet to the Debtor
in light of its insolvency;
ii. the entitlement of the Debtor to receive
distributions in the insolvency of BridgeStreet and the basis for
those distributions;
iii. the allocation between BridgeStreet, the Debtor and
other parties of a receivable due under an agreement dated Jan. 25,
2016 between BridgeStreet Corporate Housing LLC (now known as HCB
(2020), LLC), Brookfield Global Relocation Services, LLC and other
related entities; and
(b) advising on the entitlement of the Debtor to recover under
its guarantee claims and related security granted by:
i. BridgeStreet Accommodations Ltd. (in creditors'
voluntary liquidation) and
ii. Domus BWW UK Holdings Limited (in creditors'
voluntary liquidation) including advising on the validity of the
guarantees and security and liaising with the liquidator of the
relevant companies to agree on the basis and entitlement of the
Debtor to receive distributions in the insolvency of these
entities.
Gateley will be paid as follows:
Stuart Tait, Partner GBP575
Andrew Horton, Associate GBP360
Mark Wilson, Partner GBP575
Jenna King, Senior Associate GBP425
Kady Upton, Trainee GBP158
As disclosed in court filings, Gateley neither holds nor represents
any interest adverse to the Debtor.
The firm can be reached through:
Stuart Tait
Gateley Plc
111 Edmund Street,
Birmingham,
West Midlands,
B3 2HJ, England
Phone: +44 (0) 121 234 0000
Email: stuart.tait@gateleylegal.com
About Domus BWW Funding
Domus WWW Funding, LLC is an affiliate of 1801 Admin, LLC, a
sub-advisor providing various services in support of private
investment funds as its client may request or require and is a
registered investment advisor with the SEC under the Investment
Advisers Act of 1940.
Domus BWW Funding and 1801 Admin sought Chapter 11 bankruptcy
protection (Bankr. E.D. Pa. Lead Case No. 22-11162) on May 4, 2022.
At the time of the filing, the Debtors listed up to $500,000 in
assets and up to $50,000 in liabilities.
Judge Eric L. Frank oversees the cases.
The Debtors tapped Aris J. Karalis, Esq., at Karalis PC as
bankruptcy counsel. Perkins Coie LLP, Gateley Plc and Landis Rath &
Cobb LLP serve as the Debtors' special counsels.
DOMUS BWW: Seeks to Hire Landis Rath as Local Litigation Counsel
----------------------------------------------------------------
Domus BWW Funding, LLC and 1801 Admin, LLC seek approval from the
U.S. Bankruptcy Court for the Eastern District of Pennsylvania to
hire Landis Rath & Cobb, LLP as local litigation counsel.
The Debtors require legal assistance in connection with a pending
litigation in Delaware whose outcome will influence heavily the
resolution of their Chapter 11 cases.
The hourly rates charged by the firm for its services are as
follows:
Partners $750 - $1075 per hour
Associates $410 - $550 per hour
Paraprofessionals $295 - $350 per hour
Rebecca Butcher, Esq., a partner at Landis, disclosed in a court
filing that her firm neither represents nor holds any interest
adverse to the Debtors or to their estates with respect to the
Delaware litigation.
The firm can be reached through:
Rebecca L. Butcher, Esq.
Landis Rath & Cobb LLP
919 Market Street, Suite 1800
Wilmington, DE 19801
Phone: 302.467.4400
Fax: 302.467.4450
Email: butcher@lrclaw.com
info@lrclaw.com
About Domus BWW Funding
Domus WWW Funding, LLC is an affiliate of 1801 Admin, LLC, a
sub-advisor providing various services in support of private
investment funds as its client may request or require and is a
registered investment advisor with the SEC under the Investment
Advisers Act of 1940.
Domus BWW Funding and 1801 Admin sought Chapter 11 bankruptcy
protection (Bankr. E.D. Pa. Lead Case No. 22-11162) on May 4, 2022.
At the time of the filing, the Debtors listed up to $500,000 in
assets and up to $50,000 in liabilities.
Judge Eric L. Frank oversees the cases.
The Debtors tapped Aris J. Karalis, Esq., at Karalis PC as
bankruptcy counsel. Perkins Coie LLP, Gateley Plc and Landis Rath &
Cobb LLP serve as the Debtors' special counsels.
DOMUS BWW: Taps Perkins Coie as Special Litigation Counsel
----------------------------------------------------------
Domus BWW Funding, LLC and 1801 Admin, LLC seek approval from the
U.S. Bankruptcy Court for the Eastern District of Pennsylvania to
employ Perkins Coie, LLP as special litigation counsel.
The Debtors need the firm's legal assistance in connection with the
following cases: (i) Case No. 2022-01817, 01819, filed in the
Supreme Court of the State of New York, Appellate Division; (ii)
Adversary No. 22-02028-CMB, filed in the U.S. Bankruptcy Court for
the Western District of Pennsylvania; (iii) Case No. 20-12600-KHK,
filed in the U.S. Bankruptcy Court for the Eastern District of
Virginia; and (iv) a case titled as Doums BWW Funding, LLC, et al.,
v. CIM Group, L.P., et al., filed in the Supreme Court of the State
of New York, County of New York.
The hourly rates charged by the firm's attorneys and paralegals are
as follows:
Partners $900 per hour
Counsels $774 per hour
Associates $562 per hour
Paralegals $288 to $310 per hour
In addition, the firm will seek reimbursement for its out-of-pocket
expenses.
David Daniels, Esq., a partner at Perkins Coie, disclosed in a
court filing that his firm is a "disinterested person" as the term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
David Daniels, Esq.
Perkins Coie LLP
700 13th Street, NW Suite 800
Washington, DC 20005-3960
Office: (202) 654-6200
Direct: (202) 654-6364
Fax: (202) 654-6211
Email: DDaniels@perkinscoie.com
About Domus BWW Funding
Domus WWW Funding, LLC is an affiliate of 1801 Admin, LLC, a
sub-advisor providing various services in support of private
investment funds as its client may request or require and is a
registered investment advisor with the SEC under the Investment
Advisers Act of 1940.
Domus BWW Funding and 1801 Admin sought Chapter 11 bankruptcy
protection (Bankr. E.D. Pa. Lead Case No. 22-11162) on May 4, 2022.
At the time of the filing, the Debtors listed up to $500,000 in
assets and up to $50,000 in liabilities.
Judge Eric L. Frank oversees the cases.
The Debtors tapped Aris J. Karalis, Esq., at Karalis PC as
bankruptcy counsel. Perkins Coie LLP, Gateley Plc and Landis Rath &
Cobb LLP serve as the Debtors' special counsels.
DR. R'KIONE BRITTON: Files Subchapter V Case, Mulls 90-Month Plan
-----------------------------------------------------------------
Dr. R'Kione Britton Chiropractic Corporation filed for chapter 11
protection in the District of Central California. The Debtor filed
as a small business debtor seeking relief under Subchapter V of
Chapter 11 of the Bankruptcy Code.
The Debtor offers chiropractic and other health-related services.
In order to survive the Covid-19 pandemic, the Debtor took out an
SBA emergency loan and once the pandemic business restrictions were
partially lifted, the Debtor took out merchant cash advance loans.
Unfortunately business income has not rebounded sufficient to cover
the payments on, especially, the brutally expensive merchant cash
advances.
The bankrutpcy case was precipitated by the Debtor's inability to
service the merchant cash adn SBA EIDL loans. Additionally, the
Debtor has been sued by creditors Fundfi and Ace Funding Source,
LLC. Prior to the bankruptcy filing, Fundfi attempted to divert or
put a hold on the Debtor's payroll account, merchant services
account, and bank accounts.
The Debtor intends to file a repayment plan which provides for a
term of 90 months to pay off claims. Administrative expenses are
to be paid out in months 1 through 24. Secured equipment purchases
are paid out in months 1 through 24 at $1,416 per month. After the
administrative expenses are paid off, the payment is increased to
$3,708 per month in months 25 through 48. UCC 1 liens are paid out
in months 48 through 84. Unsecured creditors are projected to
receive $0.02 on the dollar and are paid out in months 84 through
90.
According to court documents, Dr. R'Kione Britton Chiropractic
Corp. estimates between 1 and 49 unsecured creditors. The petition
states funds will be available to unsecured creditors.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for June 21, 2022 at 9:15 A.M.
About Dr. R'Kione Britton Chiropractic Corp.
Dr. R'Kione Britton Chiropractic Corp. is a healthcare company
offering chiropractic, spinal and joint care; neuropathy treatment;
spinal decompression; soft tissue rehabilitation and pain relief;
muscle and joint injury rehabilitation; chronic pain relief care;
posture restoration; laser therapy; peak performance and sports
injury treatment; and scar tissue treatment.
Dr. R'Kione Britton Chiropractic Corporation sought protection
under Subchapter V of Chapter 11 of the U.S. Bankruptcy Code
(Bankr. C.D. Cal. Case No. 22-13004) on May 31, 2022. In the
petition signed by Dr. R'Kione Britton, as president, the Debtor
estimated assets between $100,000 and $500,000 and liabilities
between $1 million and $10 million.
The case has been assigned to Honorable Bankruptcy Judge Deborah J.
Saltzman.
Steven E. Cowen, Esq., of S.E. COWEN LAW is the Debtor's counsel.
Susan K Seflin has been appointed as Subchapter V trustee.
FINANCE OF AMERICA: Moody's Alters Outlook on B2 CFR to Negative
----------------------------------------------------------------
Moody's Investors Service has affirmed the B2 corporate family
rating and B3 senior unsecured debt rating of Finance of America
Funding LLC (FOA). FOA's outlook was changed to negative from
stable.
Affirmations:
Issuer: Finance of America Funding LLC
LT Corporate Family Rating, Affirmed at B2
Senior Unsecured Regular Bond/Debenture, Affirmed at B3
Outlook Actions:
Outlook, Changed to Negative from Stable
RATINGS RATIONALE
The affirmation of FOA's B2 CFR reflects the benefits to creditors
from FOA's growing franchise in the US residential mortgage,
reverse mortgage and commercial mortgage markets. The company is
one of the top three largest originators of reverse mortgages, a
top 20 retail originator of residential mortgages, and a leading
originator of fix-and-flip residential and single-family investor
mortgages.
FOA's outlook was changed to negative from stable because Moody's
expects the challenging operating conditions in the mortgage sector
will continue to pressure the company's profitability and result in
a modest decrease in its capitalization over the next 12-18
months.
Moody's said FOA reported weak profitability as measured by net
income to average managed assets (ROA) of -1.2% for the first
quarter of 2022 attributed to negative fair value marks due to
spread widening, lower originations and lower gain on sale margins;
ROA was 0.8% for the full year 2021 and 2.8% for full year 2020.
Over the next 12 to 18 months, Moody's expects FOA's and its
sector's profitability to be constrained as higher interest rates
will result in materially lower origination volumes and industry
excess capacity will keep gain-on-sale margins low.
The company's leverage is high as measured by tangible common
equity to tangible assets, even after adjusting for the low risk
the company retains on its reverse mortgage securitizations. This
adjusted measure was 7.8% at December 31, 2021. In addition, the
company's liquidity position is somewhat weaker than other rated
peers given its exposure to non-agency and non-government loans,
which are less liquid during periods of market stress than agency
and government insured mortgages. Moreover, virtually all of the
company's assets are encumbered, reducing its ability to access
alternative funding sources.
FOA's B3 senior long-term unsecured rating is based on the
application of Moody's Loss Given Default (LGD) for
Speculative-Grade Companies methodology and model, which
incorporate their priority of claim and strength of asset coverage.
The B3 senior unsecured rating is a notch below FOA's B2 CFR
because the unsecured debt is subordinate to FOA's senior secured
revolving credit facility.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Given the negative outlook, it is unlikely that upward rating
pressure will occur over the next 12 to 18 months. However, the CFR
and unsecured bond ratings could be upgraded if the company's
financial performance improves materially. This could be evidenced
by net income (excluding mortgage servicing rights (MSR) fair value
marks) to Moody's calculated risk-weighted assets increasing
sustainably above 3.0% and tangible common equity to Moody's
calculated risk-weighted tangible assets increasing sustainably
above 15.0%.
The ratings could be confirmed at their existing levels and the
company's outlook returned to stable if it returns to solid
profitability and reduces its leverage. This could be evidenced by
demonstrating sustained profitability with net income (excluding
MSR fair value marks) to Moody's calculated risk-weighted assets
above 1.5% and tangible common equity to Moody's calculated
risk-weighted tangible assets above 10.0%. In addition, increasing
the level of unencumbered assets, back-up committed liquidity, and
the 364-day tenor of its warehouse facilities would be viewed
positively.
The CFR and unsecured bond ratings could be downgraded if the
company's financial performance deteriorates. This could be
evidenced by net income (excluding MSR fair value marks) to Moody's
calculated risk-weighted assets below 1.0%, tangible common equity
to Moody's calculated risk-weighted assets below 8.0% or tangible
common equity to tangible assets below 2.0%. Downward rating
pressure could also develop if there is a deterioration in the
quality of originated loans. The unsecured debt rating could be
downgraded if the ratio of secured corporate debt to unsecured
corporate debt increase above 50% from the current level of around
40%.
The principal methodology used in these ratings was Finance
Companies Methodology published in November 2019.
FINMARK STRATEGY: Files Chapter 11 Subchapter V Case
----------------------------------------------------
Finmark Strategy Partners, LLC, filed for chapter 11 protection in
the Middle District of Florida, without stating a reason. The
Debtor filed as a small business debtor seeking relief under
Subchapter V of Chapter 11 of the Bankruptcy Code.
According to court filing, Finmark Strategy estimates between 1 and
49 unsecured creditors. The petition that states funds will be
available to unsecured creditors.
Augie K. Fabella II owns 90% of the membership interests in the
Debtor while Kathleen Fabela owns the remainder.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for June 30, 2022 at 10:00 A.M.
About Finmark Strategy Partners
Finmark Strategy Partners LLC provides management, scientific,and
technical consulting services.
Finmark Strategy Partners sought protection under Subchapter V of
Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No.
22-00580) on May 31, 2022. In the petition filed by Miguel
Castillo, as manager, Finmark Strategy Partners listed estimated
assets between $1 million and $10 million and estimated liabilities
between $1 million and $10 million.
Justin M. Luna, Esq., of LATHAM LUNA EDEN & BEAUDINE LLP, is the
Debtor's counsel.
Michael C Markham has been appointed as Subchapter V trustee.
FIRSTLIGHT HOLDCO: S&P Affirms 'B-' Rating on First-Lien Debt
-------------------------------------------------------------
S&P Global Ratings assigned its 'B-' rating and '3' recovery rating
to Albany, N.Y.-based fiber infrastructure provider Firstlight
Holdco Inc.'s non-fungible $50 million incremental add-on to its
term loan B due 2025 (total of $528 million). The '3' recovery
rating indicates S&P's expectation of meaningful (50%-70%; rounded
estimate: 55%) recovery in the event of a payment default. It
expects the company to use proceeds from the add-on to partially
paydown the outstanding $70 million balance on its revolving credit
facility and for general corporate purposes.
S&P said, "In addition, we affirmed our 'B-' rating on Firstlight's
existing first-lien debt facilities. The '3' recovery rating is
unchanged. The company's revolving credit facility was upsized to
$110.6 million from $75 million, and the maturity date was extended
to April 2025 from July 2023.
"Despite the incremental first-lien debt, we believe the recovery
prospects for Firstlight's first-lien lenders are relatively
unaffected due to the increase in our default valuation under our
simulated default scenario. We modestly raised our default
valuation of Firstlight to about $365 million from about $320
million, primarily due to the increase in asset value driven by
elevated capital investment (capex-to-revenue of about 65%) in the
company's network over the period.
"Because the transaction is leverage neutral, our 'B-' issuer
credit rating and stable outlook on Firstlight are unchanged. That
said, we view the transaction favorably because it will improve the
company's liquidity position by increasing its revolver
availability and extending the maturity. While Firstlight's
annualized adjusted debt to EBITDA remains elevated at 7.6x pro
forma the acquisition of KINBER, we believe it has good prospects
for reducing its leverage to the low-7x area by the end of
fiscal-year 2022 via earnings growth of 14%-16%."
Key analytical factors
-- S&P said, "Our simulated default scenario contemplates
speculative capital spending and economic pressure that lead to
customer churn. This would cause the company's cash flow to decline
to the point that it is unable to cover its fixed charges (interest
expense, required amortization, and maintenance capex), eventually
leading to a default in 2024."
-- S&P said, "We have valued Firstlight on a going-concern basis
using a 5.5x multiple of our projected emergence EBITDA. Generally,
we use a multiple in the 5x-6x range for the fiber infrastructure
companies we rate. We chose a 5.5x multiple to reflect the
company's ratio of owned to leased fiber network assets relative to
those of its fiber infrastructure peers."
Simulated default assumptions
-- Simulated year of default: 2024
-- EBITDA at emergence: $67 million
-- EBITDA multiple: 5.5x
Simplified waterfall
-- Net enterprise value (after 5% administrative costs): $348
million
-- Valuation split (obligors/nonobligors): 100%/0%
-- Collateral value available to first-lien secured creditors:
$348 million
-- Secured first-lien debt: $617 million
--Recovery expectations: 50%-70% (rounded estimate: 55%)
-- Collateral value available to second-lien secured creditors:
$0
-- Secured second-lien debt: $105 million
--Recovery expectations: 0%-10% (rounded estimate: 0%)
Note: All debt amounts include six months of prepetition interest.
FREDDIE MAC: Single-Family Division Head Steps Down
---------------------------------------------------
Freddie Mac (formally the Federal Home Loan Mortgage Corporation)
entered into a Separation Agreement and General Release (Agreement
and Release) with Donna Corley in connection with her stepping down
from her position as head of Freddie Mac's Single-Family division.
The Agreement and Release provides that during the transition
period, Ms. Corley's employment will continue at the same
compensation (including deferred salary and employee benefits,
subject to the terms of the applicable plans and agreements). In
addition, the parties have agreed to a mutual non-disparagement
covenant.
The Agreement and Release further provides that on or within seven
days after Nov. 25, 2022, (the Separation Date), or any date on
which Ms. Corley resigns earlier than the Separation Date, Ms.
Corley will execute a Second Separation Agreement and General
Release. This Second Agreement and Release incorporates the terms
of the first Agreement and Release, and provides no additional
payments or consideration. Together, both Agreement and Release
documents apply the terms and conditions thereof to the entire
period of employment, and integrate the terms and conditions of
Freddie Mac's Restrictive Covenant and Confidentiality Agreement.
About Freddie Mac
Federal National Mortgage Association (Freddie Mac) is a GSE
chartered by Congress in 1970. The Company's public mission is to
provide liquidity, stability, and affordability to the U.S. housing
market. Freddie Mac does this primarily by purchasing residential
mortgage loans originated by lenders. In most instances, it
packages these loans into guaranteed mortgage-related securities,
which are sold in the global capital markets and transfer
interest-rate and liquidity risks to third-party investors. In
addition, the Company transfers mortgage credit risk exposure to
third-party investors through its credit risk transfer programs,
which include securities- and insurance-based offerings. The
Company also invests in mortgage loans and mortgage-related
securities. The Company does not originate loans or lend money
directly to mortgage borrowers.
Since September 2008, Freddie Mac has been operating under
conservatorship with FHFA as Conservator. The support provided by
Treasury pursuant to the Purchase Agreement enables the company to
maintain access to the debt markets and have adequate liquidity to
conduct its normal business operations. The amount of funding
available to Freddie Mac under the Purchase Agreement was $140.2
billion at Dec. 31, 2021.
Pursuant to the Purchase Agreement, Freddie Mac will not be
required to pay a dividend to Treasury on the senior preferred
stock until it has built sufficient capital to meet the capital
requirements and buffers set forth in the Enterprise Regulatory
Capital Framework. As a result, the company was not required to
pay a dividend to Treasury on the senior preferred stock in
December 2021. As the company builds capital during this period,
the quarterly increases in its Net Worth Amount have been, or will
be, added to the aggregate liquidation preference of the senior
preferred stock. The liquidation preference of the senior
preferred stock increased to $100.7 billion on March 31, 2022 based
on the $2.7 billion increase in the Net Worth Amount during the
fourth quarter of 2021, and will increase to $104.4 billion on June
30, 2022 based on the $3.7 billion increase in the Net Worth Amount
during the first quarter of 2022.
GAMESTOP CORP: Incurs $157.9 Million Net Loss in First Quarter
--------------------------------------------------------------
GameStop Corp. filed with the Securities and Exchange Commission
its Quarterly Report on Form 10-Q disclosing a net loss of $157.9
million on $1.38 billion of net sales for the three months ended
April 30, 2022, compared to a net loss of $66.8 million on $1.28
billion of net sales for the three months ended May 1, 2021.
As of April 30, 2022, the Company had $3.13 billion in total
assets, $1.67 billion in total liabilities, and $1.45 billion in
total stockholders' equity.
The Company ended the period with cash and cash equivalents of
$1.035 billion as well as no debt other than a low-interest,
unsecured term loan associated with the French government's
response to COVID-19.
During the three months ended April 30, 2022, cash flows from
operating activities were an outflow of $303.9 million, compared
with an outflow of $18.8 million during the same period last year.
Cash used in operating activities was primarily due to a $179.8
million decrease in trade payables and customer liabilities for the
pay down of merchandise inventory purchases. Cash used in
operating activities during the three months ended May 1, 2021 was
primarily impacted by the $17.8 million make-whole premium related
to the early redemption of the outstanding balance of the 2023
Senior Notes, and stock-based compensation.
Cash flows from investing activities were an inflow of $66.1
million during the three months ended April 30, 2022 compared to an
outflow of $14.7 million during the same period last year. Cash
provided by investing activities during the three months ended
April 30, 2022 was primarily attributable to proceeds from the sale
of digital assets, partially offset by technological investments,
and investments in two new fulfillment centers. Cash used in
investing activities during the three months ended May 1, 2021 was
primarily attributable to higher capital expenditures.
Cash flows from financing activities were an outflow of $1.1
million during the three months ended April 30, 2022 compared to an
inflow of $169.3 million during the comparable prior year period.
Cash used in financing activities during the three months ended
April 30, 2022 was primarily attributable to settlement of
stock-based awards. Cash provided by financing activities during
the three months ended May 1, 2021 was due to $551.7 million in
aggregate proceeds from the sale of shares of common stock in the
ATM Offering (net of approximately $5.0 million of commissions).
The Company completed the voluntary redemption of its then
outstanding 2023 Senior Notes for an aggregate of $234.2 million
(inclusive of a $17.8 million make-whole premium) and repaid $73.2
million to retire at maturity its then outstanding 2021 Senior
Notes. The Company also repaid $25.0M of its then outstanding
borrowing under the 2022 Revolver.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1326380/000132638022000072/gme-20220430.htm
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.
GENOCEA BIOSCIENCES: Dr. Ali Behbahani Quits as Director
--------------------------------------------------------
Dr. Ali Behbahani notified Genocea Biosciences, Inc. of his desire
to resign from the Board of Directors of the Company, effective
immediately.
Dr. Behbahani has served on the Board since 2018. Dr. Behbahani's
resignation was not a result of or caused by any disagreement with
the Company, as disclosed in a Form 8-K filed with the Securities
and Exchange Commission.
About Genocea Biosciences
Headquartered in Cambridge, Massachusetts, Genocea --
http://www.genocea.com-- is a biopharmaceutical company
developing
personalized cancer immunotherapies. The Company uses its
proprietary discovery platform, ATLAS, to profile CD4+ and CD8+T
cell (or cellular) immune responses to tumor antigens.
Genocea reported a net loss of $33.20 million for the year ended
Dec. 31, 2021, compared to a net loss of $43.71 million for the
year ended Dec. 31, 2020. As of Dec. 31, 2021, the Company had
$55.97 million in total assets, $28.89 million in total
liabilities, and $27.07 million in total stockholders' equity.
Boston, Massachusetts-based Ernst & Young LLP, the Company's
auditor since 2009, issued a "going concern" qualification in its
report dated March 18, 2022, citing that the Company has suffered
recurring losses from operations, has limited financial resources,
and has stated that substantial doubt exists about the Company's
ability to continue as a going concern.
GENOCEA BIOSCIENCES: Voluntarily Withdraws Nasdaq Stock Listing
---------------------------------------------------------------
Genocea Biosciences, Inc. filed with the Securities and Exchange
Commission a Form 25 notifying the voluntary withdrawal of the
Company's Common Stock, par value $0.001 per share, from listing
and registration on the Nasdaq Capital Market.
About Genocea Biosciences
Headquartered in Cambridge, Massachusetts, Genocea --
http://www.genocea.com-- is a biopharmaceutical company
developing
personalized cancer immunotherapies. The Company uses its
proprietary discovery platform, ATLAS, to profile CD4+ and CD8+T
cell (or cellular) immune responses to tumor antigens.
Genocea reported a net loss of $33.20 million for the year ended
Dec. 31, 2021, compared to a net loss of $43.71 million for the
year ended Dec. 31, 2020. As of Dec. 31, 2021, the Company had
$55.97 million in total assets, $28.89 million in total
liabilities, and $27.07 million in total stockholders' equity.
Boston, Massachusetts-based Ernst & Young LLP, the Company's
auditor since 2009, issued a "going concern" qualification in its
report dated March 18, 2022, citing that the Company has suffered
recurring losses from operations, has limited financial resources,
and has stated that substantial doubt exists about the Company's
ability to continue as a going concern.
GREAT ATLANTIC: Taps Griffin Hamersky as Special Counsel
--------------------------------------------------------
The Great Atlantic & Pacific Tea Company, Inc. and its affiliates
seek approval from the U.S. Bankruptcy Court for the Southern
District of New York to employ Griffin Hamersky, LLP as special
counsel.
The Debtor needs the firm's legal assistance to prosecute claim
objections against McKesson Corporation, McKesson Pharmacy Systems,
or McKesson Specialty Care Distribution Corp., and all claims and
counterclaims that the McKesson entities might assert against the
Debtors.
Griffin will be paid 50 percent of all sums billed by the firm to
the Debtors and will be reimbursed for its out-of-pocket expenses.
Michael Hamersky, Esq., a partner at Griffin, disclosed in a court
filing that his firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Michael D. Hamersky, Esq.
Griffin Hamersky LLP
420 Lexington Avenue, Suite 400
New York, NY 10170
Tel: 646-998-5580/646-998-5578
Fax: 646-998-8284
Email: mhamersky@grifflegal.com
About The Great Atlantic &
Pacific Tea Company
Based in Montvale, New Jersey, The Great Atlantic & Pacific Tea
Company, Inc., and its affiliates are one of the nation's oldest
leading supermarket and food retailers, operating approximately 300
supermarkets, beer, wine, and liquor stores, combination food and
drug stores, and limited assortment food stores across six
Northeastern states. The primary retail operations consist of
supermarkets operated under a variety of well known trade names, or
"banners," including A&P, Waldbaum's, SuperFresh, Pathmark, Food
Basics, The Food Emporium, Best Cellars, and A&P Liquors.
Then with 429 stores, A&P and its affiliates filed Chapter 11
petitions (Bankr. S.D.N.Y. Case No. 10-24549) on Dec. 12, 2010, and
in 2012 emerged from Chapter 11 bankruptcy as a privately held
company with 320 supermarkets.
On July 19, 2015, with 300 stores, A&P and 20 affiliated debtors
each filed a Chapter 11 petition (Bankr. S.D.N.Y. Case No.
15-23007) after reaching deals for the going concern sales of 120
stores. As of Feb. 28, 2015, the Debtors reported total assets of
$1.6 billion and liabilities of $2.3 billion. Judge Robert D. Drain
of the U.S. Bankruptcy Court for the Southern District of New York
presides over the 2015 cases.
The Debtors tapped Weil, Gotshal & Manges LLP as counsel, Evercore
Group L.L.C., as investment banker, FTI Consulting, Inc., as
financial advisor, Hilco Real Estate, LLC, as real estate advisor,
and Prime Clerk LLC, as claims and noticing agent.
GREENWAY HEALTH: S&P Alters Outlook to Negative, Affirms 'B-' ICR
-----------------------------------------------------------------
S&P Global Ratings revised its ratings outlook on Tampa, Fla.-based
health care software company Greenway Health LLC to negative from
stable and affirmed its 'B-' long-term issuer rating.
S&P's negative outlook reflects refinancing risk and the
possibility that the capital structure is unsustainable if efforts
to increase EBITDA are insufficient to cover rising interest
expense.
S&P said, "The rating action reflects our view of Greenway's
challenging business prospects, rising interest rates, and a
looming debt maturity. We think the confluence of these
uncertainties increases the possibility that the capital structure
is unsustainable. Our rating also reflects our base case
expectation for 2022 of adjusted debt to EBITDA of around 11x to
12x and single-digit free cash flow, excluding the $26 million
settlement payment, based on a single-digit revenue decline and 300
basis point compression in EBITDA margin. Our base case for 2023 is
for flat revenue and 350 basis point expansion in EBITDA margins,
resulting in a debt to EBITDA improvement to 9x-10x and about $10
million in free cash flow before mandatory debt repayment.
"We view the business as generally weaker due to protracted
turnaround efforts, potential lingering reputational damage,
intensifying competition, and rising wages. These factors increase
uncertainty in our 2023 and 2024 expectations for revenue and
EBITDA. We believe there is an elevated risk that customer
retention rates and relationship growth are less favorable than
expected. Although the pandemic has limited sales and marketing
efforts for Greenway, it has also reduced the same for its
competition and may have helped Greenway retain customers during
the remediation after 2019. The company could still lose customers
as contracts expire, and competition is intensifying as more
software providers have solid electronic health records (EHR) and
revenue cycle management (RCM) offerings focused on the outpatient
setting, including athenahealth Group Inc.
Although switching costs are high, outpatient health care providers
are less complex than hospital, so software displacement occurs
more frequently. S&P's near flat revenue growth expectations for
Greenway demonstrate a lower retention rate compared to many other
health care software companies including EHR providers, like
PointClickCare Technologies Inc., that can grow in the high-single
digits or low-double digits organically with little new client
growth. The recent allegations of wrongdoing and settlement with
the Department of Justice (DOJ) will likely contribute to a
continued lower growth rate, despite having migrated all clients to
compliant systems. At the same time, Greenway has not focused on
acquiring new customers in recent years, and the market has matured
significantly with more large, end-to-end software providers.
Additionally, rising wages and a very tight labor market could lead
to higher expenses or lower customer satisfaction. Software
engineers are amongst the most-in-demand employees and Greenway's
compensation expense, even for contractors, could rise more than
expected. If the company has difficulty filling positions, its
service levels could suffer and hurt customer satisfaction. Also,
the company's recent cost optimization could also hurt customer
satisfaction if support is not of the same quality.
Greenway also offers two distinct core platforms, which adds
greater expenses compared to peers operating a single platform.
Greenway's Prime Suite is a legacy platform still preferred by some
clients, but Greenway will likely look to only maintain its next
generation platform Intergy over time. If more clients migrate off
Prime Suite, Greenway could realize additional expenses (although
temporary) and potentially lose clients during the transition
period, which could occur in the next 2-5 years.
S&P said, "Rising interest rates are a key risk due to the
company's thin cash flow. By 2023, we expect interest expense could
rise by $15 million (300 basis points of interest rate) or more
annually compared to 2021 due to a rising base rate and the need to
refinance 2024 maturities, which will likely result in a wider
spread than current facilities. In 2022, we expect single-digit
free cash flow, excluding the $26 million cash settlement payment,
so the rising interest expense could lead to cash flow deficits if
EBITDA does not increase as much as expected. We expect operating
results to improve in 2023 but see risk that revenue and EBITDA may
not grow as fast as expected, making it more difficult to cover the
increasing fixed charge. Greenway's impending maturity also
increases refinancing risk, given the challenging market conditions
and our view the Greenway's business position has weakened over the
past few years.
"Our base case is for Greenway's revenue and EBITDA to improve
across 2022 and into 2023. We think Greenway's revenue has
flattened at an annualized amount that is about 20% below the peak
in 2015, following a gradual degradation. With the $57 million DOJ
False Claims Act and the $26 million class action settlements now
fully paid and its customers migrated to compliant systems,
Greenway can focus again on growing its existing relationships and
marketing to prospective clients. Additionally, health care
providers are now accustomed to operating amid the COVID-19
pandemic and are more likely to consider implementing new or
additional software systems, after a period focused on surviving
the early stages of the pandemic. Greenway is also launching new
product updates and modules to improve the customer experience,
which should lead to some incremental revenue. We also think
expenses will decline by an annual run rate of approximately $10
million in 2022, primarily from the capture of duplicative costs
from a multiyear cost optimization plan. The company could also
have more expense flexibility as it brings its products into
compliance and completes its five-year Corporate Integrity
Agreement with the DOJ in early 2024.
"As a result, our base case forecast for 2022 is for revenue to
decline 4% from 2021 and adjusted EBITDA margins to contract 300
basis points from 2021. We previously expected essentially flat
revenue in 2022. In 2023, we think the lower expense base should
lead to adjusted EBITDA margins to expand 350 basis points on
limited revenue growth.
"Our negative outlook reflects the heightened risk to our base case
that operating results will improve from a combination of better
client retention, greater new product sales, and cost optimization.
We think Greenway's business improvement could be insufficient to
offset rising interest expenses. This risk is compounded by the
looming debt maturity in February 2024.
"We could lower the rating within the next 12 months if we believe
the capital structure is likely unsustainable or the company is
unable refinance its debt. In this scenario, we would expect
sustained cash flow deficits, resulting from the company
underperforming our expectations. We think this could occur if
customer retention rates are worse than expected (resulting in
lower revenue expectations) or the company does not capture cost
reductions as much as projected.
"We could revise the outlook to stable if Greenway successfully
refinances its term loan, and we believe the company will generate
sufficient cash flow to cover its fixed charges with some
cushion--likely free cash flow in the $10 million area. In this
scenario, we would expect some revenue growth and improving
margins."
ESG credit indicators: E-2, S-2, G-3
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis. 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 the generally finite holding periods and a focus on
maximizing shareholder returns.
"Our governance assessment also reflects the company's $57.25
million payment to resolve the DOJ's allegations under the False
Claims Act and a $26 million payment to settle related class action
claims. The allegations included claims that the company
misrepresented its capabilities in acquiring its Health and Human
Services certification. Greenway has a new management team since
the settlement and has spent significant capital to bring its
products into compliance. We think the allegations and subsequent
settlement have worsened the company's credit risk from the cash
payments, increased operating expenses, and reputational damage."
GROM SOCIAL: Falls Short of Nasdaq Minimum Bid Price Requirement
----------------------------------------------------------------
Grom Social Enterprises, Inc. received a deficiency letter from the
Listing Qualifications Department of The Nasdaq Stock Market LLC on
May 24, 2022, notifying the Company that, based upon the closing
bid price of the Company's common stock, par value $0.0001 per
share, for the last 30 consecutive business days, the Company is
not currently in compliance with the requirement to maintain a
minimum bid price of $1.00 per share for continued listing on The
Nasdaq Capital Market, as set forth in Nasdaq Listing Rule
5550(a)(2).
The Notice has no immediate effect on the continued listing status
of the Company's Common Stock on The Nasdaq Capital Market, and,
therefore, the Company's listing remains fully effective.
The Company is provided a compliance period of 180 calendar days
from the date of the Notice, or until Nov. 21, 2022, to regain
compliance with Nasdaq Listing Rule 5550(a)(2). If at any time
before Nov. 21, 2022, the closing bid price of the Company's Common
Stock closes at or above $1.00 per share for a minimum of 10
consecutive business days, subject to Nasdaq's discretion to extend
this period pursuant to Nasdaq Listing Rule 5810(c)(3)(G), Nasdaq
will provide written notification that the Company has achieved
compliance with the Minimum Bid Requirement, and the matter would
be resolved.
If the Company does not regain compliance with the Minimum Bid
Requirement during the initial 180 calendar day period, the Company
may be eligible for an additional 180 calendar day compliance
period. To qualify, the Company would be required to meet the
continued listing requirement for market value of publicly held
shares and all other initial listing standards for The Nasdaq
Capital Market, with the exception of the Minimum Bid Requirement,
and would need to provide written notice of its intention to cure
the deficiency during the second compliance period, by effecting a
reverse stock split, if necessary.
The Company will continue to monitor the closing bid price of its
Common Stock and seek to regain compliance with all applicable
Nasdaq requirements within the allotted compliance periods. If the
Company does not regain compliance within the allotted compliance
periods, including any extensions that may be granted by Nasdaq,
Nasdaq will provide notice that the Company's Common Stock will be
subject to delisting. The Company would then be entitled to appeal
that determination to a Nasdaq hearings panel.
The Company intends to actively monitor the closing bid price of
the Common Stock and will evaluate available options to regain
compliance with the Minimum Bid Requirement. However, there can be
no assurance that the Company will regain compliance with the
Minimum Bid Requirement during the 180-day compliance period,
secure a second period of 180 days to regain compliance or maintain
compliance with the other Nasdaq listing requirements.
If the Common Stock ceases to be listed for trading on the Nasdaq
Capital Market, the Company would expect that the Common Stock
would be traded on one of the three tiered marketplaces of the OTC
Markets Group.
About Grom Social
Boca Raton, Florida-based Grom Social Enterprises, Inc. --
www.gromsocial.com -- is a media, technology and entertainment
company focused on delivering content to children under the age of
13 years in a safe secure Children's Online Privacy Protection Act
("COPPA") compliant platform that can be monitored by parents or
guardians.
Grom Social reported a net loss of $10.22 million for the year
ended Dec. 31, 2021, a net loss of $5.74 million for the year ended
Dec. 31, 2020, and a net loss of $4.59 million for the year ended
Dec. 31, 2019. As of March 31, 2022, the Company had $37.46
million in total assets, $9.90 million in total liabilities, and
$27.56 million in total stockholders' equity.
GRUBHUB INC: S&P Downgrades ICR to 'CCC+', Outlook Developing
-------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating to 'CCC+' from
'B-' and its issue-level rating on U.S. food delivery company
Grubhub Inc.'s $500 million senior unsecured notes to 'B-' from
'B'. The '2' recovery rating is unchanged.
The developing outlook reflects that S&P could affirm, raise or
lower the rating depending on Just Eat Takeaway.com's (JET)
willingness to provide support over the next 12 months and
Grubhub's ability to improve profitability and cash flow
generation.
In its first-quarter 2022 trading update, Grubhub's parent, JET
announced that management and its advisers are exploring strategic
options for Grubhub. This could result in a strategic partner
and/or the partial or full sale of Grubhub.
S&P said, "The downgrade reflects our view that JET will not
support Grubhub in all foreseeable circumstances, and on a
standalone basis, Grubhub's capital structure is unsustainable. In
its first-quarter 2022 trading update, JET revised its comments
regarding strategic alternatives for Grubhub to include a partial
or full sale of the company. As a result, we revised our view of
the extent of long-term commitment of support from JET. We now
believe Grubhub is only moderately strategic to JET, and JET is
unlikely to provide financial support to Grubhub beyond the next 12
months.
"As such, our issuer credit rating on Grubhub reflects our view of
the company on a standalone basis, without the previous one-notch
rating uplift from JET. The rating reflects Grubhub's
less-than-adequate liquidity and persistent free operating cash
flow deficits. We still expect JET to provide financial support in
2022 as it weighs its strategic options. In the first quarter of
2022, JET provided a $100 million cash injection to Grubhub, and we
think there is a reasonable chance JET will make additional
contributions in 2022.
"With its tight liquidity, we expect Grubhub to shift its operating
strategy toward profitability from substantial investments in
growing its market share. Grubhub had $144 million of cash on its
balance sheet at March 31, 2022, and while the company has access
to JET's multicurrency revolving credit facility, JET agreed not to
draw on it during 2022 to receive a waiver from its financial
covenants. On its first-quarter trading update, JET indicated a
shift in strategy to focus on improving profitability in 2022 and
pull back certain investments in market share growth. We believe
this strategy extends to Grubhub. While we expect this shift will
improve Grubhub's profitability in 2022, we still forecast negative
EBITDA and free operating cash flow generation. We also believe
lower growth investments along with a normalization of order
volumes as COVID-19 restrictions ease will result in volume
declines in 2022. We believe this strategic shift could hurt
operating performance and market share over the next few years as
better capitalized competitors prioritize growth over profitability
in Grubhub's markets.
"In our updated forecast, we expect 2022 free operating cash flow
deficits of about $125 million to $150 million, which is an
improvement from our prior forecast of deficits above $200
million.
"Fee caps in Grubhub's key New York City market continue to weigh
on profitability and cash flow. At the onset of the COVID-19
pandemic, local governments in key Grubhub markets enacted
commission fee caps to protect restaurants' sustainability. New
York, Grubhub's largest market, made fee caps permanent in August
2021, and we believe the company has lost more than $300 million of
EBITDA since the start of the pandemic due to these fee caps. We
assume fee caps will remain in place in our forecast, though
Grubhub and its peers are challenging rulings in New York and San
Francisco."
There is an uncertain path to positive free operating cash flow
generation. While a favorable ruling to eliminate or revise fee
caps in New York City could provide over $100 million of annual
incremental EBITDA, the outcome and timing of a ruling are out of
Grubhub's control.
Additionally, the shift in strategy to focus on profitability over
market share growth could result in better-than-expected operating
performance if the company is able to maintain relatively stable
order volumes. Still, S&P believes there is a significant risk of
an unfavorable ruling in New York City or an inability to execute
on its strategic shift to drive a meaningful improvement in
profitability which would likely result in persistent negative free
operating cash flow generation.
S&P said, "The developing outlook reflects that we could affirm,
raise, or lower the rating on Grubhub depending on the company's
ability to improve profitability and cash flow generation.
"We could lower the rating if we believe JET is unwilling or unable
to provide financial support to cover Grubhub's cash flow deficits,
resulting in Grubhub's total liquidity falling below $75 million,
and we expect a default within 12 months.
"We could raise the rating if a shift in strategy toward
profitability from market share growth results in positive free
operating cash flow or if fee caps in New York City are modified or
lifted such that Grubhub's cash flow and profitability turn
positive."
ESG credit indicators: E-2, S-4, G-2
S&P said, "Social factors are now a more negative consideration in
our rating analysis of Grubhub. Through the COVID-19 pandemic, many
local governments capped the fees that third-party delivery
companies could charge restaurants, including those in Grubhub's
largest markets, New York City and San Francisco. Fee caps have
impaired EBITDA by more than $300 million since the second quarter
of 2020. Fee caps will continue to hurt profitability if not
reversed through lawsuits or lobbying efforts.
"In addition, the concept of gig economy contractors has provoked
legal and regulatory challenges following criticism that drivers
make less than minimum wage and are not afforded certain labor
rights or benefits of full-time employees. Because most of
Grubhub's operating expenses cover employee-related costs, changes
to employment laws could reduce profitability."
GT REAL ESTATE: $20MM DIP Loan from DT Sports Has Interim OK
------------------------------------------------------------
GT Real Estate Holdings, LLC sought and obtained interim authority
from the U.S. Bankruptcy Court for the District of Delaware to,
among other things, obtain postpetition financing and provide liens
and super-priority claims with respect to the financing.
GT Real Estate Holdings has secured a $20 million delayed-draw term
loan facility from its direct parent, DT Sports Holding, LLC. The
Debtor said the loan will enable it, in the first instance, to
undertake essential maintenance on the real estate project site,
and will also allow it to maintain its insurance, utilities service
and security detail on an ongoing basis.
The DT Sports is a secured superpriority debtor-in-possession
credit facility with the aggregate principal amount of up to $20
million, which includes (i) $16.8 million available in multiple
draws as set forth in, and subject to the terms and conditions of,
the DIP Credit Agreement, of which $2 million will be made
available upon entry of the Interim DIP Order, and (ii) a roll-up
loan facility, pursuant to which the DIP Lender will be deemed to
make a loan under the Roll-Up DIP Facility, which Roll-Up DIP Loan
will be in an aggregate principal amount equal to the Debtor's
outstanding obligations under a second promissory note and
guaranty, which is no less than $3.2 million, and will be deemed
used to satisfy and discharge those obligations.
GT Real Estate Holdings was created to own and a develop a
mixed-use, pedestrian-friendly community, sports, and entertainment
venue, that would also include a new headquarters and practice
facility for billionaire David Tepper's Carolina Panthers
professional football team, situated on a 240-acre site located in
Rock Hill, South Carolina. To realize this vision, the Debtor
acquired a site for the Project and entered into various agreements
with the City of Rock Hill, York County, South Carolina, and other
parties.
The Debtor's access to the DIP Facility is vital to the achievement
of its principal objectives in the chapter 11 case: ensuring the
safety and security of the Project, preserving and maximizing the
value of its assets for the benefit of its stakeholders, and
administering a fair, efficient and timely process for resolving
the claims arising from the demise of the Debtor's development
project.
The Debtor has secured debt outstanding under two secured
promissory notes issued to DT Sports: the first, in the principal
amount of $4 million and, the second, in the principal amount of
$3.2 million.
As security for its obligations thereunder, the Debtor pledged its
membership interests in non-debtor Waterford Golf Club, LLC.
Waterford guarantees the Prepetition Secured Notes and granted a
mortgage on the Mortgaged Property to the Prepetition Secured
Lender.
The Project is subject to statutory mechanic's and materialmen's
liens under applicable local law, which secure the Debtor's
obligations to contractors, sub-contractors, and vendors for work
in progress and materials supplied. The amount of unpaid claims
secured by valid, perfected and unavoidable statutory liens is
unknown at this time. However, the Debtor estimates that the
Secured Trade Obligations could total as much as $90 million.
All loan proceeds will be used solely for (i) fees, costs, and
expenses (including any fees, costs, and expenses related to the
DIP Facility) in relation to the Chapter 11 Case, (ii) payment of
amounts due to the independent manager or managers of the Debtor,
(iii) costs and expenses incurred or to be incurred by the Borrower
in connection with the Project, and (iv) working capital and other
general corporate purposes of the Borrower, in each case in
accordance with, and subject to the limitations set forth in the
DIP Credit Agreement and the DIP Order.
The Borrower agrees to comply with these milestones, unless
otherwise agreed to in writing by the DIP Lender:
a. On or before the third Business Day after the Petition
Date, the Interim DIP Order will have been entered, and such order
will not have been reversed, modified, amended, stayed or vacated;
b. On or before the 30th day after the entry of the Interim
DIP Order, the Final DIP Order will have been entered, and such
order will not have been reversed, modified, amended, stayed or
vacated;
c. On or before July 31, 2022, Borrower will have filed with
the Bankruptcy Court an Acceptable Plan;
d. On or before September 30, 2022 (or such later date as
agreed to by the DIP Lender in its sole discretion), the
Confirmation Order will have been entered; and
e. On or before October 31, 2022 (or such later date as agreed
to by the DIP Lender in its sole discretion), an Acceptable Plan
will have been substantially consummated (as such term is used in
section 1101 of the Bankruptcy Code).
As adequate protection, the DIP Lender will be granted valid,
binding, continuing, enforceable, fully perfected, and
non-avoidable first priority senior security interests in and liens
upon all DIP Collateral and valid, binding, continuing,
enforceable, fully perfected security interests and liens upon DIP
Collateral encumbered by Permitted Liens, which security interests
and liens will be subject and subordinate to the Permitted Liens
and the Carve-Out.
The Carve-Out means the sum of: (i) all fees required to be paid to
the Clerk of the Court and all statutory fees payable to the U.S.
Trustee under 28 U.S.C. Section 1930(a), together with the
statutory rate of interest; (ii) all reasonable fees and expenses
up to $50,000 incurred by a trustee under Section 726(b) of the
Bankruptcy Code; and (iii) the Allowed Professional Fees of the
Professionals incurred on and after the first business day
following the Carve-Out Trigger Date in an aggregate amount not to
exceed $1 million.
The Court will hold a final hearing on the request on June 29
before the Honorable Karen B. Owens. Objections are due June 22.
A copy of the motion is available at https://bit.ly/3az7vff from
PacerMonitor.com.
About GT Real Estate Holdings, LLC
GT Real Estate Holdings, LLC sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. D. Del. Case No. 22-10505) on June
1, 2022. In the petition signed by Jonathan Hickman, chief
restructuring officer, the Debtor disclosed up to $500,000 in both
assets and liabilities.
Judge Karen B. Owens oversees the case.
The Debtor tapped Farnan LLP as Delaware restructuring counsel,
White and Case LLC as restructuring counsel, Alvarez and Marsal as
financial advisor, and Kroll Restructuring Administration LLC as
claims and noticing agent and administrative advisor.
H & H INVESTMENTS: Hits Chapter 11 Bankruptcy Protection
--------------------------------------------------------
H & H Investments, LLC, filed for chapter 11 protection in the
District of Central California.
According to court filings, H & H Investments LLC estimates between
1 and 49 unsecured creditors. The petition states that funds will
be available to unsecured creditors.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for June 27, 2022 at 09:00 A.M.
About H & H Investments
H & H Investments LLC engages in the construction of industrial
buildings and warehouses.
H & H Investments sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Case No. 22-12998) on May 30,
2022. In the petition filed by Jessie Laiken, as agent, H & H
Investments estimated assets between $500,000 and $1 million and
estimated liabilities between $100,000 and $500,000.
The case is assigned to Honorable Bankruptcy Judge Barry Russell.
Michael D Kwasigroch, of The Law Offices of Michael D Kwasigroch,
is the Debtor's counsel.
HOFFMASTER GROUP: S&P Downgrades ICR to 'CCC' on Refinancing Risk
-----------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on U.S.-based
paper and tissue-based disposable tableware company Hoffmaster
Group Inc. to 'CCC' from 'CCC+'.
S&P said, "At the same time, we lowered our issue-level rating on
the company's first-lien secured credit facilities to 'CCC' from
'CCC+'. The recovery rating remains '3', indicating our expectation
for meaningful (50%-70%; rounded estimate: 65%) recovery of
principal in the event of a payment default.
"We also lowered our issue-level rating on the company's
second-lien term loan to 'CC' from 'CCC-'. The recovery rating
remains '6', indicating our expectation for negligible (0%-10%;
rounded estimate: 0%) recovery of principal in the event of a
payment default.
"The negative outlook reflects the risk that the company could
pursue a distressed exchange or restructuring that we view as
tantamount to default.
"We believe Hoffmaster faces heightened refinancing risk given its
looming debt maturities. Hoffmaster faces significant debt
maturities in 2023, with its revolving credit facility due May 22,
2023 and its first-lien term loan due Nov. 21, 2023. Significant
cost pressures, beginning in second half of 2021, weakened earnings
and led to a sizeable increase in net working capital in 2021. The
$32 million free cash flow deficit was funded primarily with cash
and borrowings under its revolving credit facility. Through the
first quarter, the company continued to utilize its revolving
credit facility for its seasonal working capital requirement and
debt service. As of Mar. 31, 2022 there was approximately $23
million drawn on its revolving credit facility and $404 million
outstanding under its first-lien term loan. We believe the company
must refinance its capital structure to avoid defaulting on these
commitments. Despite our expectation for improved financial
performance in 2022, we believe the company's elevated leverage and
tight liquidity increase the likelihood of a distressed exchange
offer or redemption below par within the next 12 months."
S&P expects the continued recovery in foodservice, resilient
consumer demand, and pricing actions to spur revenue growth in
2022. Full-year sales increased nearly 20% in 2021 following
unprecedented COVID-19-related lockdowns during 2020 which
adversely affected retail and full service restaurants. Over the
last 12 months, Hoffmaster experienced strong demand recovery
across both its foodservice and consumer segments. Foodservice
sales rebounded as restaurants continued to recover, and sales
growth is expected in the double-digits, despite the anniversary of
the one-time benefit related to face shield sales which did not
repeat in 2021. Furthermore, Hoffmaster believes its performance
through the pandemic and subsequent recovery has resulted in market
share gains given its high service levels and ability to meet
strong demand. During 2021, consumer sales returned to pre-pandemic
levels driven by volume growth in its club and e-commerce channels.
However, recent paperboard and labor constraints have presented
challenges in meeting customer demand and growth is expected to
slow in 2022.
In response to rising costs, Hoffmaster completed profitability
analyses on its product portfolio and customers and implemented
targeted pricing actions to improve earnings. Despite the solid
rebound in sales in 2021, S&P Global Ratings-adjusted EBITDA
margins remained flat due to global supply chain constraints and
material and freight inflation. In the second half of 2021, a
significant rise in the cost of raw materials and freight depressed
profitability. To offset accelerating cost inflation, Hoffmaster
executed several price initiatives. Although it began to realize
the benefit of these actions in the fourth quarter of 2021, it will
recognize the majority in 2022. Hoffmaster estimates it will
achieve more than $25 million of pricing above projected inflation
in 2022 as a result of implemented and recognized price actions.
S&P forecasts meaningful margin expansion over the next 12 months
as input cost inflation moderates and the company recognizes the
benefit from its price initiatives.
The negative outlook reflects the risk that the company could
pursue a distressed exchange or restructuring that S&P views as
tantamount to default.
S&P could lower its rating on Hoffmaster if:
-- S&P believes a payment default or distressed restructuring is
inevitable within the next six months.
S&P could raise its rating on Hoffmaster if:
-- The company refinances its upcoming debt maturities and
strengthens its liquidity through a transaction in which the
lenders receive the full value of the securities as originally
promised; and
-- It generates sufficient free cash flow to cover its debt
service, capital spending requirements, and intrayear working
capital needs.
ESG credit indicators: E-2, S-2, G-3
S&P said, "Health and safety factors have improved in our view and
are now a neutral consideration in our credit analysis. As a
result, we changed our social credit indicator to S‐2 from S‐3.
Governance is a moderately negative consideration in our credit
rating analysis of Hoffmaster Group Inc. This is the case for most
rated entities owned by private-equity sponsors. We believe
Hoffmaster's highly leveraged financial risk profile points to
corporate decision-making that prioritizes the interests of the
controlling owners. This also reflects the generally finite holding
periods and a focus on maximizing shareholder returns."
HORSE CARRIAGE: Files for Chapter 11 Pro Se, UST Seeks Dismissal
----------------------------------------------------------------
Horse Carriage Enterprises, LLC, commenced a bankruptcy case on May
27, 2022, by filing a voluntary petition under chapter 11 of the
United States Bankruptcy Code.
The Debtor filed the petition without a lawyer.
The U.S. Trustee immediately filed a motion to dismiss the case.
The UST notes that the Debtor failed to identify the name and/or
names of any attorney(s) designated to represent the Debtor on its
petition. Instead, Debtor indicates that it is not represented by
an attorney in this proceeding and is proceeding pro se.
According to the UST, a corporation cannot appear personally on its
own behalf before this Court and must, therefore, be represented by
counsel. Without legal counsel, the Debtor will be unable to comply
with the
requirements for the successful prosecution of its case pursuant to
11 U.S.C. Sec. 101 et seq. The Debtor also failed to file a
corporate resolution evidencing that the agent signing the Petition
was authorized to file the Petition on behalf of the Debtor.
About Horse Carriage Enterprises
Horse Carriage Enterprises LLC is a Single Asset Real Estate (as
defined in 11 U.S.C. Sec. 101(51B)).
Horse Carriage Enterprises sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. E.D. Pa. Case No. 22-11370) on May
27, 2022.
The case is assigned to Honorable Bankruptcy Judge Patricia M.
Mayer.
In the petition signed by Lupe Amy Gonzalez, as managing member,
Horse Carriage Enterprises estimated assets and liabilities of up
to $50,000. According to court filings, Horse Carriage Enterprises
estimates between 1 and 49 unsecured creditors. The petition
states funds will be available to unsecured creditors.
IBEC LANGUAGE: Unsecureds to Recover 10% via Quarterly Payments
---------------------------------------------------------------
IBEC Language Institute, Inc., filed with the U.S. Bankruptcy Court
for the Southern District of New York a Disclosure Statement for
Small Business Chapter 11 Plan of Reorganization dated June 2,
2022.
For 27 years, the Debtor has offered courses on American culture
and business English communication skill development to Japanese
business-people and their families in New York City.
However, the COVID-19 Pandemic devastated the Debtor. The shutdown
precluded in-person classes and international travel came to a
halt. The Debtor took several measures to stay alive. It pivoted to
on line classes, which are producing revenue, but certainly not at
pre-COVID levels.
The Debtor also vacated its expensive NYC office and moved its
principal location to the Debtor's Principal's home in Rockland
County, New York. The NYC landlord sued the Debtor for rent
accruing through the surrender date, allegedly in the amount of
approximately $280,000. An additional blow came in May 2021, when
the Debtor's lender, Citibank NA, called its revolving loan and
demanded payment in full in the approximate amount of $93,000.
The Debtor and Kazuo Endo (the Debtor's Principal) have reached an
agreement with its prior landlord. Additionally, the Debtor has
been successful in avoiding and reclassifying Citibank NA and NYC
Department of Finance's claims, and the Debtor is poised to move
forward with its Plan of Reorganization.
Class 2 consists of holders of Allowed General Unsecured Claims.
The Debtor estimates that Class 2 Claims total approximately
$309,307.17. The Debtor shall pay to holders of Class 2 General
Unsecured Claims an aggregate 10% distribution on account of
Allowed Class 2 Unsecured Claims, payable in 12 quarterly
installments without interest, commencing on the Effective Date.
Allowed Class 2 Claims are impaired under this Plan and holders of
such Claims shall be entitled to vote to accept or reject the
Plan.
Class 3 consists of the General Unsecured Claims of Kazuo Endo, the
principal of the Debtor, and Chieko Endo, the wife of the principal
of the Debtor, as reflected in the Schedules in the amount of
$760,818.71. The holders of the Class 3 Claims have agreed to waive
their rights to a distribution on account of such claim. The Class
3 Claim is impaired under the Plan and the holders of such Claims
shall be deemed to reject the Plan.
Class 4 consists of Kazuo Endo and Chieko Endo, the holders of
Interests in the Debtor. Class 4 Interest holders shall retain
their interests in the Debtor and are not expected to receive any
monetary distributions under the Plan. Class 4 Interests are
unimpaired and deemed to accept the Plan.
The Plan shall be funded with the Debtor's Cash and net operating
proceeds and shall be distributed by the Debtor.
A full-text copy of the Disclosure Statement dated June 02, 2022,
is available at https://bit.ly/3zkVCnI from PacerMonitor.com at no
charge.
Attorneys for the Debtor:
KIRBY AISNER & CURLEY, LLP
700 Post Road, Suite 237
Scarsdale, New York 10583
Tel: (914) 401-9500
Dawn Kirby, Esq.
dkirby@kacllp.com
About IBEC Language
IBEC Language Institute, Inc., has offered courses on American
culture and business English communication skill development to
Japanese business people and their families in New York City.
IBEC Language filed a Chapter 11 bankruptcy petition (Bankr.
S.D.N.Y. Case No. 21-22455) on Aug. 6, 2021. The Debtor was
estimated to have less than $100,000 in assets and less than
$500,000 in liabilities as of the bankruptcy filing. The Debtor is
represented by Dawn Kirby, Esq. of KIRBY AISNER & CURLEY LLP.
IMERYS TALC: Fineman, et al. Update on Talc Injury PI Claimants
---------------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
the law firms of Fineman Krekstein & Harris PC, KTBS Law LLP and
Aylstock, Witkin, Kreis & Overholtz, PLLC, submitted a supplement
verified statement to disclose an updated list of AWKO Plaintiffs
that they are representing in the Chapter 11 cases of Imerys Talc
America, Inc., et al.
Each of the AWKO Plaintiffs has, individually, retained AWKO to
represent him or her as counsel in connection with, among other
things, Talc Personal Injury Claims against one or more of the
above-captioned debtors or certain of their subsidiaries and
affiliates.
On or about April 14, 2021, AWKO retained KTBS Law LLP as special
bankruptcy counsel. On or about April 19, 2021, AWKO retained
Fineman Krekstein & Harris PC as Delaware special bankruptcy
counsel.
AWKO does not represent the AWKO Plaintiffs as a "committee" or a
"group" and does not undertake to represent the interests of, and
is not a fiduciary for, any creditor, party in interest, or other
entity that has not signed a retention agreement with AWKO.
As of June 3, 2022, each of the AWKO Plaintiffs and their
disclosable economic interests are:
Sharifa
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Mary
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Chavonne
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Virginia
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Leslie
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Laura
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Mary
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Maria
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Catherine
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Tammy
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Diana
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Milagros
* Nature of Claim: Talc Personal Injury
* Amount of Claim: Unliquidated
Counsel to the AWKO Plaintiffs can be reached at:
FINEMAN KREKSTEIN & HARRIS PC
Deirdre M. Richards, Esq.
1300 North King Street
Wilmington, DE 19801
Telephone: (302) 538-8331
Facsimile: (302) 394-9228
Email: drichards@finemanlawfirm.com
- and -
KTBS LAW LLP
Michael L. Tuchin, Esq.
Robert J. Pfister, Esq.
Samuel M. Kidder, Esq.
1801 Century Park East, 26th Floor
Los Angeles, CA 90067
Telephone: (310) 407-4000
Facsimile: (310) 407-9090
E-mail: mtuchin@ktbslaw.com
rpfister@ktbslaw.com
skidder@ktbslaw.com
- and -
AYLSTOCK, WITKIN, KREIS & OVERHOLTZ, PLLC
Justin Witkin, Esq.
17 East Main Street, Suite 200
Pensacola, FL 32502
Telephone: (850) 202-1010
E-mail: jwitkin@awkolaw.com
A copy of the Rule 2019 filing is available at
https://bit.ly/3tk2cXL at no extra charge.
About Imerys Talc America
Imerys Talc America, Inc. and its subsidiaries --
https://www.imerys-performance-additives.com/ -- are in the
business of mining, processing, selling and distributing talc. Its
talc operations include talc mines, plants and distribution
facilities located in Montana (Yellowstone, Sappington, and Three
Forks); Vermont (Argonaut and Ludlow); Texas (Houston); and
Ontario, Canada (Timmins, Penhorwood, and Foleyet). It also
utilizes offices located in San Jose, Calif., and Roswell, Ga.
Imerys Talc America and its subsidiaries, Imerys Talc Vermont,
Inc., and Imerys Talc Canada Inc., sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 19-10289) on Feb. 13, 2019. The
Debtors were estimated to have $100 million to $500 million in
assets and $50 million to $100 million in liabilities as of the
bankruptcy filing.
Judge Laurie Selber Silverstein oversees the cases.
The Debtors tapped Richards, Layton & Finger, P.A., and Latham &
Watkins LLP as their legal counsel, Alvarez & Marsal North America,
LLC, as financial advisor, and CohnReznick LLP as restructuring
advisor. Prime Clerk, LLC, is the claims agent.
The U.S. Trustee for Region 3 appointed an official committee of
tort claimants in the Debtors' Chapter 11 cases. The tort
claimants' committee is represented by Robinson & Cole, LLP.
INNOVATIVE BUILDING: Wins Cash Collateral Access Thru July 31
-------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Idaho authorized
Innovative Building and Remodeling to use cash collateral in the
ordinary course of business in accordance with the budget for the
period from the Petition Date through July 31, 2022.
Prior to the filing of the Debtor's bankruptcy petition, the Debtor
entered into a Note and a First Modification of Note with the U.S.
Small Business Administration per the EIDL program in the total
loan amount of $500,000 plus interests and costs. The Notes are
secured. The Debtor entered into a Security Agreement and an
Amended Security Agreement in favor of the SBA, and the SBA filed a
UCC-1 financing statement with the Idaho Secretary of State. The
Debtor also entered into a Loan Authorization Agreement and Amended
Loan Authorization Agreement.
As of the Petition Date, the Debtor owed the SBA not less than
$520,271. The Debtor acknowledges and agrees the SBA has a blanket
lien in and on all property, which among other things, includes all
the Debtor's personal property.
As adequate protection for the use of cash collateral, the secured
parties identified are granted a replacement perfected security
interest and liens in and to all of the Debtor's assets (a)
acquired after the Petition Date, (b) now-existing, and (c)
hereafter acquired, (d) including proceeds, to the same extent and
with the same priority as the secured parties had security
interests immediately before the bankruptcy petition was filed in
the case.
The replacement liens and security interests granted to the SBA are
automatically deemed perfected upon the entry of the Order, without
the necessity of the SBA taking possession, filing financing
statements, mortgages, or other documents.
To the extent the adequate protection provided for proves
insufficient to protect the SBA's interest in and to the cash
collateral, the SBA will have a superpriority administrative
expense claim, pursuant to Bankruptcy Code Section 507(b), senior
to any and all claims against the Debtor under Section 507(b),
whether in this proceeding or in any superseding proceeding.
A copy of the order is available at https://bit.ly/3mgpfyw from
PacerMonitor.com.
About Innovative Building & Remodeling
Innovative Building & Remodeling is a family owned and operated
construction company in Meridian, Idaho, that specializes in custom
design and build projects.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Idaho Case No. 22-00071) on March 4,
2022. In the petition signed by Dustin Collins, its managing
member, the Debtor disclosed $496,400 in assets and $1,218,331 in
liabilities.
Judge Noah G. Hillen oversees the case.
Luke Gordon, Esq., at Gordon, Delic and Associates is the Debtor's
counsel.
IRONSTONE PROPERTIES: Board OKs Conversion of CEO Debt Into Equity
------------------------------------------------------------------
The Ironstone Properties Board of Directors approved the conversion
of debt held by William R. Hambrecht, CEO to Ironstone Properties,
Inc. common stock. William R. Hambrecht abstained from voting.
This transaction was executed on May 27, 2022 where a total of
$824,269 in loans and accrued interest were converted to 404,054
common shares at a price of $2.04 per share. The conversion price
was determined by using the trailing 90 day average stock price.
About Ironstone Properties
Ironstone Properties, Inc.'s main assets are investments in
non-marketable securities of TangoMe Inc., and Buoy Health, Inc.,
and marketable securities of Arcimoto Inc. There can be no
assurance that a market will continue to exist for these
investments.
Ironstone Properties reported a net operating loss of $523,401 for
the 12 months ended Dec. 31, 2021, compared to a net operating loss
of $301,658 for the 12 months ended Dec. 31, 2020. As of March 31,
2022, the Company had $5.48 million in total assets, $3.90 million
in total liabilities, and $1.58 million in total stockholders'
equity.
IVEDIX INC: Wins Cash Collateral Access Thru Sept 30
----------------------------------------------------
The U.S. Bankruptcy Court for the Western District of New York
authorized IVEDiX, Inc. to use cash collateral on an interim
basis.
The Debtor and the U.S. Small Business Administration, as
prepetition secured lender, stipulate that:
1. Prior to the Petition Date, the Debtor was indebted to the
SBA pursuant to a $150,000 Note dated May 21, 2020, executed and
delivered by the Debtor in the outstanding amount of $150,000 plus
any applicable interest or fees.
2. The Debtor's indebtedness to the SBA under the Note is
secured by a security interest and lien in "all tangible and
intangible personal property, including, but not limited to: (a)
inventory, (b) equipment, (c) instruments, including promissory
notes (d) chattel paper, including tangible chattel paper and
electronic chattel paper, (e) documents, (f) letter of credit
rights, (g) accounts, including health-care insurance receivables
and credit card receivables, (h) deposit accounts, (i) commercial
tort claims, (j) general intangibles, including payment intangibles
and software and (k) as-extracted collateral as such terms may from
time to time be defined in the Uniform Commercial Code. Prepetition
Secured Lender asserts a security interest in cash collateral of
the Debtor.
3. Subject to the terms and conditions of the Order, the
Debtor may use the cash collateral and will pay from any proceeds
thereof any operating expenses.
4. In addition to the existing rights and interests of the SBA
in the cash collateral and for the purpose of providing adequate
protection for the SBA's interests, the Debtor:
(a) grants the SBA a valid, perfected and enforceable
post-petition security interest in and upon the Debtor's Collateral
that existed on the Petition Date; provided that, the Rollover Lien
will be (i) limited to the same extent, applicable only to the same
types of property, and in the same relative priority as the
security interest held by the SBA prior to the Petition Date, (ii)
deemed granted only to the extent of the actual diminution in value
of the Collateral on and after the Petition Date resulting from the
Debtor's use of the Collateral as approved by the Court, and (iii)
subject to any existing liens as of the date of the Order; and
(b) will pay to the Prepetition Secured Lender $731 per
month commencing as of August 2, 2021, and continuing until
September 30, 2022.
e. On or before September 30, 2022, the parties will enter
into a new Stipulated Order that covers the time period October 1,
2021, through December 31, 2022, if no chapter 11 plan has been
confirmed in the case.
f. The terms set forth constitute adequate protection of the
Prepetition Secured Lender's interest in the Collateral.
g. The Prepetition Secured Lender grants to Bond, Schoeneck &
King, PLLC, attorneys for the Debtor in the captioned Chapter 11
Case, a carve-out from the Prepetition Secured Lender's security
interests and liens in the Collateral, for Carve-Out Expenses.
"Carve-Out Expenses" means allowed but unpaid fees and expenses
incurred on and after the Petition Date by BS&K. The Prepetition
Secured Lender's security interests and liens in the Collateral are
made subject to the payment of Carve-Out Expenses with such
Carve-Out Expenses not to exceed $45,000.
As adequate protection, the Debtor will grant to the Prepetition
Secured Lender, effective as of the Petition Date, perfected
replacement security interests in and valid, binding, enforceable
and perfected liens on all Postpetition Collateral subject only to
(i) the Carve-Out, and (ii) all fees required to be paid to the
Clerk of the Court and to the Office of the United States Trustee
under 28 U.S.C. section 1930(a) plus interest at the statutory
rate, and (iii) fees and expenses of up to $5,000 incurred by a
trustee under section 726(b) of the Bankruptcy Code.
In the absence of a further Court order, the Debtor's authorization
to use Cash Collateral will cease after the earlier to occur of (i)
September 30, 2022, and (ii) the date upon which any of these
events occurs:
a. The Debtor's failure to comply with any of the terms or
provisions of the Order, and the failure of the Debtor to cure such
breach within 10 days of receiving notice of same;
b. Any stay, reversal, vacatur or rescission of the terms of
the Order;
c. Entry of an order by the Court dismissing any of the
Debtor's Chapter 11 Case or converting any of the Debtor's Chapter
11 Case to a case under chapter 7 of the Bankruptcy Code;
d. The trustee's exercise of his rights following removal of
the Debtor in Possession under section 1185 of the Bankruptcy Code
or the appointment of an examiner with enlarged powers in the
Debtor's Chapter 11 Case unless such appointment is approved by the
Prepetition Secured Lender; or
e. Any liens pursuant to the Prepetition Loan Documents or
Adequate Protection Liens with respect to the Prepetition
Collateral or Postpetition Collateral that were valid, binding and
perfected, first priority liens on the Petition Date or any liens
granted pursuant to the Order will cease to be valid, binding and
perfected, first priority liens.
A further interim hearing on the matter is scheduled for September
30 at 10 a.m.
A copy of the order is available at https://bit.ly/3xhZ15l from
PacerMonitor.com.
About IVEDiX, Inc.
IVEDiX, Inc. sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D.N.Y. Case No. 21-20453) on July 23,
2021. In the petition signed by Rajesh Kutty, chief executive
officer, the Debtor disclosed up to $1 million in assets and up to
$10 million in liabilities.
Judge Paul R. Warren oversees the case.
Curtis A. Johnson, Esq., at Bond, Schoeneck & King, PLLC is the
Debtor's counsel.
The U.S. Small Business Administration, as prepetition secured
lender, is represented by Kevin D. Robinson, Esq., of the United
States Attorney's Office.
J AND M SUPPLY: Gets Court Nod to Use Cash Collateral
-----------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of North
Carolina authorized J and M Supply of the Carolinas, LLC to use
cash collateral on an interim basis for its post-petition,
necessary and reasonable operating expenses.
The Debtor requires the use of cash collateral to maintain existing
operations and reorganize its obligations in the Chapter 11 case.
The entities that assert an interest in the Debtor's cash
collateral are Pearl Delta Funding, LLC, Cloudfund, LLC, ROC
Funding Group, LLC, and ROC Funding Group, LLC.
The Court ruled that the Secured Creditors will not retain a
continuing and replacement post-petition lien and security interest
in all property, receivables and assets of the Debtor and the
proceeds thereof, whether acquired pre-petition or post-petition.
A further hearing on the matter is scheduled for July 21, 2022 at
11 a.m.
A copy of the order is available at https://bit.ly/3GMsJm3 from
PacerMonitor.com.
About J and M Supply
J and M Supply of the Carolinas, LLC operates a sporting goods
retail store in Leland, N.C. It is a licensed Federal Firearms
dealer and specializes in the sale of firearms, ammunition and
related equipment. The company also provides firearm and first aid
training classes and is a North Carolina certified firearms
instructor.
J and M filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. E.D.N.C. Case No. 22-00536) on March 11,
2022, listing as much as $500,000 in both assets and liabilities.
Jennifer Bennington serves as the Subchapter V trustee.
Judge David M. Warren oversees the case.
Richard P. Cook, Esq., at Richard P. Cook, PLLC is the Debtor's
legal counsel.
JASPER PELLETS: Files for Chapter 11 to Stop USB Takeover
---------------------------------------------------------
Jasper Pellets, LLC, filed for chapter 11 protection in the
District of South Carolina.
The Debtor immediately commenced an adversary proceeding against
U.S. Bank Trust Company, N.A.
The Debtor operated a facility in Jasper County, South Carolina
manufacturing wood pellet biomass for use as fuel in certain
European markets. The Debtor ceased operations 7 months ago.
In order to acquire its assets and fund its operations, in December
2018, the Debtor entered into a loan agreement and two promissory
notes in the amount of $12.5 million. US Bank was appointed to
serve as the indenture trustee for the bonds.
US Bank asserts that it acquire a lien on the equity owners'
ownership interests in the Debtor to secured the bonds. USB also
asserts a first priority mortgage lien on the real property owned
by the Debtor, and all the Debtor's machinery and equipment.
According to the Debtor, the equity owners to not have personal
guarantees, and the Debtor is the only entity liable for the
bonds.
In addition to the bonds, the Debtor has $2 million in unsecured
trade and tax debt.
Further, the Debtor is party to a contract with CM Biomass Partners
A/S for the sale and purchase of wood pellet biomass production at
prices substantially below market. The Debtor's relationship with
CM has caused the Debtor's financial problems and ultimately led to
the filing for bankruptcy. The Debtor has filed with the Court a
motion to reject the contract. The Debtor expects a claim for
prepetition damages and rejection damages but believes it has
counterclaims and defenses.
On May 17, 2022, the Debtor's equity owners received a notice from
USB stating that the Debtor was in default on the bonds and
demanding payment in full of the outstanding balance due on the
bonds. The equity owners received a separate notice from USB
stating that USB would be selling the owners' equity interests in
the Debtor on May 31, 2022.
Accordingly, the Debtor has filed with the Bankruptcy Court an
adversary proceeding against USB seeking, among other things, a TRO
and preliminary injunction.
According to the Debtor, if USB is allowed to exercise its right to
sell the ownership interests, the Debtor could suffer a
postpetition change in ownership and management, which would
jeopardize the Debtor's reorganization efforts and harm the
unsecured creditors. Further, if USB is allowed to credit bid at
the sale, it is very likely that the new owners of the Debtor will
also be its secured creditor. As a result, it is in the best
interests of unsecured creditors for the equity owners to remain
the owners and managers of the Debtor until such time as the assets
may be sold pursuant to 11 U.S.. Sec. 363 or a plan of
reorganization can be confirmed.
About Jasper Pellets LLC
Jasper Pellets LLC is a wood pellet manufacturing plant in
Ridgeland, North Carolina.
Jasper Pellets, LLC, sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D.S.C. Case No. 22-01409) on May 27, 2022.
The case is assigned to Judge David R. Duncan. Michael M. Beal,
of Beal, LLC, is the Debtor's counsel.
* * *
The Petition states funds will be available to Unsecured
Creditors.
The Sec. 341(a) meeting of creditors will be held on July 8, 2022,
at 9:30 AM at Telephone - 341. Proofs of claim are due by Oct. 6,
2022.
JOG'S LLC: Files Chapter 11 Subchapter V Case
---------------------------------------------
JOG'S LLC filed a petition under the provisions of Subchapter V of
Chapter 11 of the Bankruptcy Code in Puerto Rico.
According to court filings, JOG's LLC estimates between 1 and 49
unsecured creditors. The petition states funds will be available to
unsecured creditors.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for June 27, 2022 at 3:30 P.M.
About JOG'S LLC
JOG'S LLC, doing business as Panaderia Jogs and Coffee Shop, is a
breakfast and brunch restaurant.
JOG'S LLC sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D.P.R. Case No. 22-01525) on May 27, 2022. In the
petition signed by Yamilka J. Gonzalez Torres, as president, listed
estimated assets and liabilities between $50,000 and $100,000 each.
CARMEN D CONDE TORRES, of C. Conde & Associates, is the Debtor's
counsel.
Carlos G Garcia Miranda is the Subchapter V trustee.
JOHNSON & JOHNSON CONSTRUCTION: Files Chapter 11 Subchapter V Case
------------------------------------------------------------------
Johnson & Johnson Construction Company Corp. filed for chapter 11
protection without stating a reason. The Debtor filed a petition
seeking relief under Subchapter V of Chapter 11 of the Bankruptcy
Code.
The Debtor's schedules of assets and liabilities and statement of
financial affairs are due June 13, 2022.
According to court filings, Johnson & Johnson Construction Co.
Corp. estimates between 1 and 49 unsecured creditors. The petition
states that funds will be available to unsecured creditors.
The Meeting of Creditors under 11 U.S.C. Sec. 341(a) is slated to
be held on June 29, 2022, at 12:00 PM by TELEPHONE. The Deadline
to File a Complaint to Determine Dischargeability of Certain Debts
is Aug. 29, 2022. Proofs of claim are due by Aug. 8, 2022.
About Johnson & Johnson Construction
Johnson & Johnson Construction Co. Corp. is a Florida-based
construction company.
Johnson & Johnson Construction Company Corp. filed a petition for
relief under Subchapter V of Chapter 11 of the U.S. Bankruptcy Code
(Bankr. S.D. Fla. Case No. 22-14226) on May 30, 2022. In the
petition, the Debtor disclosed assets of $500,000 to $1 million and
liabilities of at least $1 million.
The case is assigned to Honorable Bankruptcy Judge Robert A Mark.
Brian K. McMahon, of Brian K. McMahon, PA, is the Debtor's
counsel.
Linda Marie Leali has been named as Subchapter V trustee.
JONES SODA: Signs Employment Contract With CEO
----------------------------------------------
Jones Soda Co. entered into an employment agreement with Mark
Murray, the Company's chief executive officer and president.
Under the terms of the Employment Agreement, Mr. Murray is entitled
to receive an annual base salary of $330,000 and is eligible to
receive an annual cash bonus of at least $100,000 in the event that
the Company achieves annual revenues in any full fiscal year of at
least $19,900,441 (calculated in accordance with Generally Accepted
Accounting Principles in the United States) and at least ($495,066)
in annual adjusted EBITDA (as calculated in a manner consistent
with the calculation of adjusted EBITDA in the previous fiscal
year). The Annual Bonus is to be adjusted upward by $2,500 for
each 1% that the Company's actual annual revenues and adjusted
EBITDA exceed the Revenue Target and the EBITDA Target, up to a
maximum of $50,000 (the total Annual Bonus paid in any given year
shall not exceed $150,000). The amount of the Annual Bonus shall
be calculated based on the financial results of the Company's soda
business that is currently being conducted by the Company as of the
effective date of the Employment Agreement and will not include the
financial results of any acquired entities or the businesses of any
successor entity to the Company.
Additionally, pursuant to the terms of the Employment Agreement,
the Company granted Mr. Murray 1,800,000 restricted stock units
which will vest as follows with a Feb. 15, 2022 vesting
commencement date, in each case subject to Mr. Murray's continued
service through the applicable time vesting date: (1) 600,000 of
the RSUs will vest on the six month anniversary of the Vesting
Commencement Date, (2) 600,000 of the RSUs will vest on the 15
month anniversary of the Vesting Commencement Date, and (3) the
remaining 600,000 of the RSUs shall vest on the 30 month
anniversary of the Vesting Commencement Date. All RSUs shall
immediately vest upon the occurrence of a "Change in Control" as
defined in the Company's 2022 Omnibus Equity Incentive Plan.
If Mr. Murray's employment is terminated by the Company "Without
Cause" or if Mr. Murray resigns for "Good Reason" (each as defined
in the Employment Agreement), he will be entitled to receive in
addition to all earned and unpaid base salary and accrued but
unused vacation, severance benefits consisting of 12 months of his
then current base salary, and reimbursement for continuation of his
health insurance coverage, as permitted by the Consolidated Omnibus
Budget Reconciliation Act, for 12 months following termination, in
each case subject to Mr. Murray executing a separation agreement
and general release.
About Jones Soda
Headquartered in Seattle, WA, Jones Soda Co. -- www.jonessoda.com
-- develops, produces, markets and distributes premium beverages
primarily in the United States and Canada through its network of
independent distributors and directly to its national and regional
retail accounts. The Company also sells products in select
international markets. The Company's products are sold in grocery
stores, convenience and gas stores, on fountain in restaurants, "up
and down the street" in independent accounts such as delicatessens,
sandwich shops and burger restaurants, as well as through its
national accounts with several large retailers.
Jones Soda reported a net loss of $1.81 million for the year ended
Dec. 31, 2021, a net loss of $3 million for the year ended Dec. 31,
2020, and a net loss of $2.78 million for the year ended Dec. 31,
2019. As of March 31, 2022, the Company had $19.02 million in
total assets, $6.51 million in total liabilities, and $12.51
million in total shareholders' equity.
JOYFUL CARE: Seeks Court Nod on Cash Deal with SBA
--------------------------------------------------
Joyful Care Caregiving Services, Inc. asks the U.S. Bankruptcy
Court for the Central District of California to approve a
stipulation the Debtor entered into with the U.S. Small Business
Administration regarding the Debtor's use of cash collateral. The
stipulation expires on October 1, 2022.
The SBA has a blanket lien on all of the Debtor's assets, including
income, on account of the $150,000 Economic Injury Disaster Loan
(EIDL) the Debtor obtained from the SBA.
The first stipulation extended from June 30, 2021 to October 1,
2021. However, due to inadvertence, no new stipulation to extend
the original stipulation was entered into and filed. The Debtor and
SBA have now entered into the Second Stipulation, which covers the
period retroactively from October 2, 2021 to October 1, 2022.
At the time of the first stipulation, payments on the Loan were not
due yet and were set to commence on September 25, 2021, with
monthly payments set at $731. However, at this time, the Debtor has
proposed to pay the Loan under its Chapter 11 plan and the hearing
to confirm Debtor's plan is set for July 21, 2022. If the plan is
confirmed, the Debtor will commence payments under the confirmed
plan.
The Second Stipulation provided that the Debtor may use the SBA's
cash collateral, pursuant to the budget, from the date of the
Stipulation through September 1, 2022.
As adequate protection, the Debtor will make regular monthly
payments to the SBA in the aggregate amount of not less than $731.
Retroactive to the Interim Order, the SBA will receive a
replacement lien on all post-petition revenues of the Debtor to the
same extent, priority and validity that its lien attached to the
cash collateral. The scope of the replacement lien is limited to
the amount (if any) that cash collateral diminishes post-petition
as a result of the Debtors post-petition use of cash collateral.
The replacement lien is valid, perfected and enforceable and will
not be subject to dispute, avoidance, or subordination, and this
replacement lien need not be subject to additional recording.
If the protection granted is insufficient to satisfy in full the
SBA's claims, the Debtor says the SBA will be granted an allowed
claim under Section 503(b) of the Bankruptcy Code for the amount of
any such deficiency. The claim will have the superpriority under
Section 507(b) of the Bankruptcy Code, subject to fees payable to
the U.S. Trustee and fees or costs owing to the Clerk of Court.
The Debtor will keep the prepetition collateral insured, pursuant
to the Loan and the U.S. Trustee Guidelines.
A copy of the motion, along with the stipulation and the budgets
for June to August 2022, is available for free at
https://bit.ly/3tgbFPB from PacerMonitor.com.
The Debtor projects $379,448 in sales and $343,849 in total
expenses for June 2022.
Judge Erithe A. Smith will consider the request at a hearing on
July 14 at 10:30 a.m.
About Joyful Care Caregiving Services
Joyful Care Caregiving Services, Inc. sought protection for relief
under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No.
21-11648) on June 30, 2021, disclosing total assets of up to
$50,000 and total liabilities of up to $500,000. Judge Erithe A.
Smith presides over the case. Khang & Khang, LLP represents the
Debtor as legal counsel.
KENAN ADVANTAGE: Moody's Alters Outlook on 'B3' CFR to Positive
---------------------------------------------------------------
Moody's Investors Service changed the outlook for Kenan Advantage
Group, Inc. to positive from stable. Moody's also affirmed the
company's B3 corporate family rating, B3-PD probability of default
rating, the B2 rating on the company's senior secured 1st lien
credit facilities and the Caa2 rating on its senior secured 2nd
lien term loan.
The positive outlook reflects Moody's expectation that Kenan's
improved credit metrics and adequate liquidity will be sustained.
Moody's expects that the company will continue to diversify its
geographic footprint and product offering, maintain conservative
financial policy, including operating with financial leverage as
measured by debt-to-EBITDA below 5.5x and generate solid free cash
flow. Continued strong demand in its end markets during 2022 will
also support Kenan's operating performance.
Ratings Affirmed:
Issuer: Kenan Advantage Group, Inc.
Corporate Family Rating, Affirmed B3
Probability of Default Rating, Affirmed B3-PD
Gtd Senior Secured Revolving Credit Facility, Affirmed B2 (LGD3)
Gtd Senior Secured First Lien Term Loan B, Affirmed B2 (LGD3)
Gtd Senior Secured Second Lien Term Loan, Affirmed Caa2 (LGD6)
from (LGD5)
Ratings Affirmed:
Issuer: Kenan Canada GP
Gtd Senior Secured Term Loan B1, Affirmed B2 (LGD3)
Outlook Actions:
Issuer: Kenan Advantage Group, Inc.
Outlook, Changed To Positive From Stable
RATINGS RATIONALE
The ratings reflect Kenan's position as a leading truck-transporter
of liquid bulk products across the U.S. and Canada. Their leading
market share makes them competitively well positioned, based on
size, end market diversity and geographic spread, although the
company remains exposed to the underlying demand for the products
it hauls (gasoline, liquid chemicals and food grade products).
Moody's believes that Kenan's fuels delivery business and food
sector transportation services make it less susceptible to economic
down cycles relative to other trucking companies. Moody's expects
debt-to-EBITDA (inclusive of Moody's standard adjustments) to end
2022 at about 5.0x and decline further and remain in the 4.5x to
5.0x range over the next 12 to 24 months. Additionally, EBITA
margin is expected to remain around 7%, due to higher volumes and
utilizing technology to gain efficiencies that lower overall route
costs. Those efforts, together with significant investments in the
truck fleet over the past two years have enabled Kenan to expand
margins and bolster cash flow.
Kenan is exposed to the environmental risk that emission
regulations are becoming more stringent, which could result in
higher costs for conversion to more fuel-efficient tractors, as an
operator of heavy-duty trucks with diesel engines. Lastly, the
company faces corporate governance risks given private equity
ownership and its acquisitive nature, which could further constrain
the metrics if acquisitions are funded with debt.
Kenan's adequate liquidity is supported by positive free cash flow,
cash balances of $49 million and about $80 million availability
(net of outstanding L/C's) under its $150 million revolver as of
March 31, 2022. Moody's expects free cash flow will support
acquisition funding, lessening the dependence on revolver
borrowings for bolt-on acquisitions. Moody's further expects free
cash flow to adjusted debt of at least 5.0% over next year.
However, Kenan's free cash flow is volatile due to seasonal working
capital needs and capital expenditure requirements every few years
to modernize and expand its truck fleet.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded with sustained earnings growth that
results in stronger credit metrics, including maintaining
debt-to-EBITDA below 5.5x, while sustaining performance in an
environment of potential declines in fuel consumption due to rising
gas prices. Upward rating pressure could also result from a prudent
acquisition strategy and financial policies that take into account
the impact on credit metrics, greater stability in the company's
end markets, and sustained positive free cash flow with free cash
flow-to-debt around 6%.
The ratings could be downgraded with deterioration of the company's
liquidity, including expectations of negative free cash flow or
inability to generate enough cash to cover debt amortization and
capital lease payments. A deterioration in business conditions and
earnings declines, such that leverage is expected to be sustained
above 6.5x could also drive downward rating pressure. Acquisitions
or shareholder returns that increase leverage could also result in
a downgrade.
The principal methodology used in these ratings was Surface
Transportation and Logistics published in December 2021.
Kenan is a provider of liquid bulk transportation and logistics
services to the fuels, chemicals, liquid food and merchant gas
markets. Kenan offers transportation services throughout the U.S.
and in Canada using primarily a dedicated contract carriage model.
Revenue was approximately $1.9 billion for the year ended December
31, 2021. Kenan is owned by OMERS Private Equity, a manager of the
private equity investments of Canadian pension fund, Ontario
Municipal Employees Retirement System (OMERS).
KNOW LABS: Expands Leadership Team, Adds Two Senior Execs
---------------------------------------------------------
Know Labs, Inc. announced the addition of two senior executives,
each of whom will play a pivotal role in guiding the company toward
its goal of delivering the first FDA-cleared non-invasive glucose
monitor.
Steven Kent joins the company as chief product officer and Peter
Conley as chief financial officer and SVP, Intellectual Property.
They join Ron Erickson (Chairman), Phil Bosua (chief executive
officer), Dr. James Anderson (chief medical officer), Leo Trautwein
(chief marketing officer), and Masanori King Takee (SVP Software
Engineering) as members of Know Labs' executive leadership team.
"Pete and Steve bring tremendous expertise that will help us refine
and execute our IP strategy, product innovation, and machine
learning progress," said Phil Bosua, Know Labs CEO. "By
strengthening our executive leadership team, we are better
positioned to tackle the milestones needed for the FDA clearance
process."
"It is exciting to witness our organization grow," said Dr. James
Anderson, Know Labs chief medical officer. "I've been through this
process several times in my career. As we get closer to FDA
submission and clearance, the amount of work increases across
multiple disciplines; and this requires expertise in each
discipline. Having experienced and highly qualified individuals is
critical for our success."
Peter Conley, chief financial officer and SVP Intellectual Property
(IP) - Pete brings over 34 years of corporate finance and equity
capital markets experience, more than $5B in equity transactions,
and over 20 years of specialization in strategic IP analysis, IP
development and IP monetization to Know Labs, joining the company
as chief financial officer and SVP, Intellectual Property. He most
recently served as senior managing director and Head of
Intellectual Property Banking at Boustead Securities, where he
provided equity financing and M&A advisory services to small-cap
public companies with promising disruptive technologies and strong
intellectual property. Prior to Boustead, Pete was a co-founder
and chief operating officer of ipCreate, a global IP development
and innovation services company serving large multinational
companies. He also served as managing director of ipCapital Venture
Group, where he provided IP strategy and venture advisory services.
During his career, Pete has held leadership roles at MDB Capital
Group, The Analytiq Group / RDEX Research, Roth Capital Partners,
and Lehman Brothers. He was on the founding team and Head of
Equity Capital Markets at E*Offering, the investment bank of
E*Trade.
Steven Kent, chief product officer – Steve joins Know Labs as
chief product officer, where he will be responsible for product
development and clinical testing. He brings more than ten years of
experience as an inventor, entrepreneur, and leader in medical and
health-focused consumer systems. He most recently served as Head
of Health Partnerships and Corporate Strategy at Oura, a health
technology company, supporting the company's foundational strategy,
research, development, and partnerships with leading healthcare
institutions around the world, from early stage to a global,
multi-billion-dollar valuation. Previously, Steve was the founder
and CEO of Invicta Medical, a medical technology company focused on
sleep apnea treatment. He attended the University of Southern
California where he studied economics and entrepreneurship.
Leo Trautwein, chief marketing officer – Leo joined Know Labs in
February of 2021 and he has led the company's marketing, business
strategy functions, and regulatory efforts. With the addition of
the new members to the executive team, he will prioritize the
marketing role in preparation for a commercial launch. Leo has 20
years of experience in corporate strategy, marketing, and
e-commerce, leading multiple initiatives for Rivian Automotive, as
well as Fortune 500 companies including Jarden Corporation and
Vista Outdoor Inc. He holds an MBA from Tuck School of Business at
Dartmouth College and a bachelor's degree in mechanical engineering
from the University of São Paulo.
Masanori King Takee, SVP Software Engineering – King joined Know
Labs in 2018 and leads the company's software engineering,
artificial intelligence, and machine learning activities. He has
20 years of experience creating software for technology and
healthcare companies. King holds a bachelor's degree in computer
science from DigiPen Institute of Technology.
"Our team has accomplished a lot in the past few years. It was
time to add new members to the team so we can do more," said Ron
Erickson, Know Labs Chairman. "Collectively, these four talented
individuals bring decades of experience and knowledge that will
strengthen the company. 2022 and 2023 are pivotal years for Know
Labs, and I look forward to working together to achieve what we
believe will be the world's first non-invasive glucose monitoring
devices."
About Know Labs
Know Labs, Inc., was incorporated under the laws of the State of
Nevada in 1998. Since 2007, the Company has been focused primarily
on research and development of proprietary technologies which can
be used to authenticate and diagnose a wide variety of organic and
non-organic substances and materials. The Company's Common Stock
trades on the OTCQB Exchange under the symbol "KNWN."
Know Labs reported a net loss of $25.36 million for the year ended
Sept. 30, 2021, a net loss of $13.56 million for the year ended
Sept. 30, 2020, and a net loss of $7.61 million for the year ended
Dec. 31, 2019. As of March 31, 2022, the Company had $12.66
million in total assets, $5.36 million in total current
liabilities, $570,435 in total non-current liabilities, and $6.73
million in total stockholders' equity.
KOFAX PARENT: S&P Alters Outlook to Negative, Affirms 'B' ICR
-------------------------------------------------------------
S&P Global Ratings revised its outlook on the rating on U.S.-based
provider of business process and document management software Kofax
Parent Ltd. to negative from stable and affirmed its 'B' issuer
credit rating. S&P also assigned its 'B' issuer credit rating to
Project Leopard Holdings Inc., a wholly owned borrowing entity, its
'B' issue-level rating to the proposed first-lien term loans, and
its 'CCC+' rating to the second-lien term loan.
S&P said, "The negative outlook reflects our expectation of flat
revenues and our assumption of a slight decline in S&P Global
Ratings' adjusted EBITDA margins to about 40% in 2022 due to an
accelerated transition toward term and subscription licenses from a
perpetual license model. In addition to a greater debt burden, we
expect leverage to increase to the low-7x area and free operating
cash flow (FOCF) to debt to decrease to the mid-3% area."
Kofax is being acquired by Clearlake Capital and TA Associates in a
secondary buyout that will increase its outstanding debt by more
than $300 million, resulting in closing leverage of about 7.1x
based on 2021 EBITDA.
S&P said, "The transition to a more recurring revenue model and
related investments will limit near-term deleveraging prospects
after the buyout.The outlook revision reflects the greater debt
burden, with leverage rising slightly above 7x from Kofax's recent
operating range of about 6x, and potential execution risks related
to the recurring revenue transition. We expect Kofax's strategy to
accelerate its recurring revenue model to also constrain revenue
growth over the next few years due to a marked reduction in
perpetual license revenues. The company plans to invest in its
customer success and experience teams to support the transition,
which we expect to contribute to a slight EBITDA margin reduction
in 2022. As a result, we expect leverage to remain in the low-7x
area.
"Increased interest payments are likely to reduce FOCF generation,
but liquidity should remain sufficient. With the greater debt
balance under the new capital structure and likely rising interest
rates, we expect cash interest to increase by $25 million-$30
million in 2022. As a result, we expect FOCF to decrease to $55
million-$60 million. However, we believe the company's liquidity
should remain sufficient, supported by a pro forma cash balance of
about $50 million and new $150 million revolving credit facility
(RCF) with a five-year term.
"The negative outlook reflects our expectation of flat revenues and
our assumption of a slight decline in S&P Global Ratings' adjusted
EBITDA margins to the 40% area in 2022 due to an accelerated
transition toward term and subscription licenses from a perpetual
license model. In addition to a greater debt burden, we expect
leverage to increase to the low-7x area and FOCF to debt to
decrease to the mid-3% area. We also note the execution risks
associated with the transition."
S&P could lower its rating within the next 12 months if:
-- Kofax experiences worse than expected revenues or EBITDA margin
declines, perhaps because of weak customer demand, competitive
pressures, or impaired sales execution around its recurring revenue
transition; or
-- S&P does not see a path for adjusted leverage to decrease to
below 7x within 18-24 months after transaction close, or it expects
any increase in leverage above the low-7x area.
S&P could revise the outlook to stable if:
-- S&P believes Kofax is on track to successfully execute its
transition to more recurring revenues while avoiding significant
revenue declines or EBITDA margin declines; and
-- S&P considers the company able to improve and maintain leverage
below 7x and FOCF to debt above the low-single-digit percent area,
as well as a financial policy that supports these metrics.
KOPIN CORP: All Four Proposals Passed at Annual Meeting
-------------------------------------------------------
Kopin Corporation held its annual meeting of stockholders at which
the stockholders:
(1) elected John C.C. Fan, Scott L. Anchin, James K. Brewington,
David E. Brook, Chi Chia Hsieh and Jill J. Avery to serve as
directors of the Company each for a term expiring at the Company's
2023 Annual Meeting and until their successors are duly elected and
qualified;
(2) ratified an amendment to the Company's 2020 Equity Incentive
Plan to increase the number of shares authorized for issuance under
the 2020 Equity Incentive Plan from 5,500,000 to 10,000,000;
(3) ratified the appointment of RSM US LLP as the independent
registered public accounting firm of the Company for the current
fiscal year; and
(4) approved, on an advisory basis, the compensation of the
Company's named executive officers.
About Kopin
Kopin Corporation -- http://www.kopin.com-- is a developer and
provider of innovative display and optical technologies sold as
critical components and subassemblies for military, industrial and
consumer products. Kopin's technology portfolio includes
ultra-small Active Matrix Liquid Crystal displays (AMLCD), Liquid
Crystal on Silicon (LCOS) displays and Organic Light Emitting Diode
(OLED) displays, a variety of optics, and low-power ASICs.
Kopin reported a net loss of $13.47 million for the year ended Dec.
25, 2021, a net loss of $4.53 million for the year ended Dec. 26,
2020, and a net loss of $29.37 million for the year ended Dec. 28,
2019. As of Dec. 25, 2021, the Company had $63.01 million in total
assets, $23.38 million in total liabilities, and $39.63 million in
total stockholders' equity.
LCN PARTNERS: Seeks to Hire Verna & Associates as Accountant
------------------------------------------------------------
LCN Partners, Inc. seeks approval from the U.S. Bankruptcy Court
for the Eastern District of Pennsylvania to employ Verna &
Associates as its accountant.
The Debtor requires an accountant to provide bookkeeping and tax
compliance services during the pendency of its Chapter 11 case.
Verna & Associates will be paid $650 per month and will be
reimbursed for its out-of-pocket expenses. The retainer fee is
$1,700.
Ria Murrani, a partner at Verna & Associates, disclosed in a court
filing that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Ria Murrani
Verna & Associates
105 Jessup Rd Ste 100
West Deptford, NJ 08086
Tel: (856) 384-8400
About LCN Partners
LCN Partners, Inc. filed a petition for Chapter 11 protection
(Bankr. E.D. Pa. Case No. 22-10665) on March 17, 2022, listing up
to $1 million in assets and liabilities. Joseph E. Robbins,
president, signed the petition.
Judge Ashely M. Chan oversees the case.
The Debtor tapped Ciardi Ciardi & Astin as legal counsel and Verna
& Associates as accountant.
LEXARIA BIOSCIENCE: All Four Proposals Passed at Annual Meeting
---------------------------------------------------------------
Lexaria Bioscience Corp. held its annual shareholder meeting at
which the shareholders:
(a) elected Chris Bunka, John Docherty, Nicholas Baxter, Ted
McKechnie, and Albert Reese Jr. as directors;
(b) ratified the appointment of Davidson & Company LLP as
auditors;
(c) approved, on a non-binding, advisory basis, the compensation
of the Company's named executive officers issued for the 2021
fiscal year; and
(d) ratified the lawful actions of the directors for the past
year.
The next advisory vote on the executive compensation will take
place at the Company's 2025 annual meeting where the Company's
shareholders will also be given an opportunity to vote on the
frequency of executive compensation approval.
About Lexaria
Lexaria Bioscience Corp. -- http://www.lexariabioscience.com-- is
a global innovator in drug delivery platforms. Its patented
DehydraTECH drug delivery technology changes the way Active
Pharmaceutical Ingredients enter the bloodstream, promoting
healthier ingestion methods, lower overall dosing, and higher
effectiveness for lipophilic active molecules. DehydraTECH
increases bio-absorption, reduces time of onset, and masks unwanted
tastes for orally administered bioactive molecules, including
cannabinoids, vitamins, non-steroidal anti-inflammatory drugs
(NSAIDs), nicotine, and other molecules. Lexaria has licensed
DehydraTECH to multiple companies in the cannabis industry for use
in cannabinoid beverages, edibles and oral products and to a
world-leading tobacco producer for the development of smokeless,
oral-based nicotine products. Lexaria operates a licensed
in-houseresearch laboratory and holds a robust intellectual
property portfolio with 16 patents granted and over 60 patents
pending worldwide.
Lexaria Bioscience reported a net loss and comprehensive loss of
$4.19 million for the year ended Aug. 31, 2021, a net loss and
comprehensive loss of $4.08 million for the year ended Aug. 31,
2020, and a net loss and comprehensive loss of $4.16 million for
the year ended Aug. 31, 2019. As of Feb. 28, 2022, the Company had
$11.41 million in total assets, $194,623 in total liabilities, and
$11.22 million in total stockholders' equity.
MERLIN ACQUISITION: Frontmatec Deal No Impact on Moody's B3 CFR
---------------------------------------------------------------
Moody's Investors Service said that Merlin Acquisition
Corporation's B3 corporate family rating is unaffected by the
company's decision to acquire Frontmatec. On May 24, Merlin
Acquisition Corporation (d/b/a Bettcher Industries) signed a
definitive agreement to purchase Frontmatec from private equity
firm Axcel. The acquisition will expand scale and enhance product
offerings, but elevate integration risk.
Headquartered in Birmingham, Ohio, Merlin Acquisition Corporation
is the parent company of Bettcher Industries, Inc. and is owned by
private equity firm Kohlberg Kravis Roberts & Co. L.P. (KKR). The
Bettcher portfolio includes the following: Bettcher, a designer and
manufacturer of handheld trimmers, tools, and cutting consumables
for all protein applications; Cantrell-Gainco, a manufacturer of
processing equipment and yield enhancement and yield tracking
systems for various protein operations; ICB Greenline, an
aftermarket replacement parts and services company focused on
poultry processing; and, Exsurco Medical, a medical device company
that provides products and services to improve surgical grafting,
debridement, and recovery outcomes for patients with burn and
trauma wounds. The company generated approximately $200 million of
revenue in 2021.
MICROSTRATEGY INC: Stockholders Elect Five Directors
----------------------------------------------------
MicroStrategy Incorporated held its 2022 Annual Meeting of
Stockholders at which the stockholders:
(1) elected Michael J. Saylor, Stephen X. Graham, Jarrod M.
Patten, Leslie J. Rechan, and Carl J. Rickertsen as directors for
the next year;
(2) ratified the selection of KPMG LLP as the Company's
independent registered public accounting firm for the fiscal year
ending Dec. 31, 2022.
About MicroStrategy
MicroStrategy is an enterprise analytics software and services
company. Since its founding in 1989, MicroStrategy has been
focused on empowering organizations to leverage the immense value
of their data. MicroStrategy pursues two corporate strategies in
the operation of its business. One strategy is to acquire and hold
bitcoin and the other strategy is to grow its enterprise analytics
software business.
MicroStrategy reported a net loss of $535.48 million for the year
ended Dec. 31, 2021, and a net loss of $7.52 million for the year
ended Dec. 31, 2020. For the nine months ended Sept. 30, 2021, the
Company reported a net loss of $445.50 million. As of March 31,
2022, the Company had $3.64 billion in total assets, $2.78 billion
in total liabilities, and $863 million in total stockholders'
equity.
* * *
As reported by the TCR on June 15, 2021, S&P Global Ratings
assigned its 'CCC+' issuer credit rating to Tysons Corner,
Va.-based MicroStrategy Inc. S&P said, "The stable outlook reflects
our expectation that MicroStrategy's operating results will remain
consistent over the next 12 given its good recurring revenue base
and the low interest expense on its convertible debt, which will
allow it to maintain good EBITDA interest coverage and generate
positive free operating cash flow. We expect these factors to
enable the company to sustain its capital structure over the
subsequent 12 months."
NANO MAGIC: Sells Majority Interest in Applied Nanotech
-------------------------------------------------------
Nano Magic Holdings, Inc. announced the sale of its majority
interest in Applied Nanotech, Inc. to the employees of that
subsidiary.
Jacque Soptick, an employee for over 20 years, became the majority
owner of Applied Nanotech. She stated: "We are excited for this
new chapter of Applied Nanotech as a woman-owned business. After
more than two decades, the time has finally arrived to take
ownership of its future."
Dr. Richard Fink, the other purchaser who is continuing as the
chief scientist explained: "After decades of commitment to Applied
Nanotech, Jacque and I can now call it our own. I look forward to
continuing my collaboration with Jacque to expand and grow the
contract research and specialized product sales, capitalizing on
our technology."
For Nano Magic, Tom Berman, President, noted: "This lets Nano Magic
sharpen its focus on brand development and our own product
portfolio while still retaining minority ownership in Applied
Nanotech and its future. This is a true win-win transaction."
On May 26, 2022 David Sherbin was elected to the Nano Magic board.
Mr. Sherbin retired in April 2021 from from his position as the
senior vice president, general counsel, chief compliance officer
and secretary at Aptiv PLC (formerly Delphi Automotive). He joined
that company in 2005 and served as General counsel & Chief
Compliance Officer. Prior to that, Mr. Sherbin served Pulte Group,
Federal Mogul Corporation and Heller Financial Inc. in legal and
compliance roles. He is a graduate of Oberlin College and Cornell
Law School. He is 62 years old. Tom Berman commented: "We are
elated to have someone of David's caliber and experience join our
Board. He has worked virtually his entire career with public
reporting companies and brings to our Board a wealth of legal,
business, and compliance experience that will strengthen our
team."
About Nano Magic
Headquartered in Madison Heights, Michigan Nano Magic --
www.nanomagic.com -- develops, commercializes and markets consumer
and industrial products powered by nanotechnology that solve
everyday problems for customers in the optical, transportation,
military, sports and safety industries.
Nano Magic reported a net loss of $1.57 million for the year ended
Dec. 31, 2021, compared to a net loss of $781,055 for the year
ended Dec. 31, 2020. As of March 31, 2022, the Company had $3.91
million in total assets, $2.32 million in total liabilities, and
$1.59 million in total stockholders' equity.
Sterling Heights, Michigan-based UHY LLP, the Company's auditor
since 2019, issued a "going concern" qualification in its report
dated March 30, 2022, citing that the Company has recurring losses
from operations, negative cash flow from operations, and an
accumulated deficit. These conditions raise substantial doubt
about the Company's ability to continue as a going concern.
NB HOTELS: Court OKs Deal on Cash Collateral Access
---------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Dallas Division, approved the stipulation among:
* debtor NB Hotels Dallas LLC,
* Wells Fargo Bank, National Association as Trustee for Morgan
Stanley Capital Trust 2019-22 for the benefit of the Commercial
Mortgage Pass-Through Certificate Holder, and
* the U.S. Small Business Association,
authorizing the Debtor to use cash collateral on an interim basis
in accordance with the budget, with a 10% variance.
As previously reported by the Troubled Company Reporter, the Debtor
filed the Chapter 11 case having suffered through two years of the
COVID-19 pandemic. The loss of revenue as a result of the pandemic
placed the Debtor behind on certain payments.
The Debtor intends to rearrange its affairs and needs to continue
operating in order to pay its ongoing expenses, generate additional
income, and propose a plan in the case. Access to cash collateral
will allow the Debtors to continue ongoing operations.
On February 8, 2019, Morgan Stanley Bank N.A. made a $42,840,000
loan to the Debtor. The Secured Noteholder claims the Loan is
evidenced by, among other things: (i) a promissory note dated
February 8, 2019, and (ii) a loan agreement between the Debtor as
borrower and the Original Lender as lender, also dated February 8,
2019.
As adequate protection, the Secured Lender and the SBA were granted
replacement security interests and liens on all the Debtor's
assets and property.
The final hearing on the matter is scheduled for June 27, 2022 at
1:30 p.m.
A copy of the order is available at https://bit.ly/3PVL0S1 from
PacerMonitor.com.
About NB Hotels Dallas LLC
NB Hotels Dallas LLC owns and operates the Le Meridien Hotel Dallas
located at 13402 Noel Road, Dallas, Texas. The Debtor sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
N.D. Tex. Case No. 22-30681) on April 18, 2022. In the petition
signed by Nadir Badruddin, its president, the Debtor disclosed up
to $100 million in both assets and liabilities.
Judge Harlin Dewayne Hale oversees the case.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC is the
Debtor's counsel.
Counsel to lender, Wells Fargo Bank, National Association as
Trustee for Morgan Stanley Capital Trust 2019-22 for the benefit of
the Commercial Mortgage Pass-Through Certificate Holder:
Bruce J. Zabarauskas, Esq.
Holland & Knight LLP
1722 Routh Street, Suite 1500
Dallas, TX 75201
Email: bruce.zabarauskas@hklaw.com
NEXTPLAY TECHNOLOGIES: Business Combinations Delay Form 10-K Filing
-------------------------------------------------------------------
NextPlay Technologies, Inc. filed with the Securities and Exchange
Commission a Form 12b-25 notifying the delay in the filing of its
Annual Report on Form 10-K for the year ended Feb. 28, 2022.
NextPlay has determined that it is unable to file its Annual Report
within the prescribed time period without unreasonable effort or
expense. The delay is due primarily to recent business
combinations which resulted in a reverse acquisition of the Company
in June 2021 and the expansion of the Company's business into new
industries and different geographical regions.
On July 23, 2020, the Company (then known as Monaker Group, Inc.)
entered into a Share Exchange Agreement with HotPlay Enterprise
Limited and the stockholders of HotPlay. Pursuant to the Share
Exchange Agreement, Monaker exchanged shares of its common stock
for 100% of the issued and outstanding capital of HotPlay, with
HotPlay continuing as a wholly-owned subsidiary of Monaker. The
acquisition of HotPlay and Monaker closed on June 30, 2021. After
the acquisition, Monaker changed its name to "NextPlay
Technologies, Inc." The HotPlay acquisition was accounted for as a
reverse acquisition, with HotPlay being deemed the acquiring
company for accounting purposes.
On Jan. 15, 2021, the Company (then known as Monaker) entered into
a Founding Investment and Subscription Agreement with Reinhart
Interactive TV AG, a company organized in Switzerland, and Jan C.
Reinhart, the founder of Reinhart. Pursuant to the Investment and
Subscription Agreement, on March 31, 2021, the Company purchased
51% of the outstanding equity interests of Reinhart, resulting in
Reinhard becoming a majority-owned subsidiary of the Company.
On July 21, 2021, the Company completed the acquisition of Next
Bank International, a Puerto Rico corporation licensed as an Act
273-2012 international financial entity (formerly IFEB), pursuant
to which the NextBank became a wholly-owned subsidiary of the
Company.
Not only did the foregoing Acquisitions result in the Company
having to consolidate the financial information of the businesses
acquired into its financial statements and notes related thereto,
but the Acquisitions also resulted in a number of significant
operational changes for the Company, including changes in the
industries, geographies and currencies in which the Company
operates, as well as changes in its management structure. This is
the first annual report that certain operational information,
including the results of operations of those business acquired in
connection with the Acquisitions, will be reflected in the
Company's audited financial statements and notes thereto, as well
as other portions of the Annual Report.
For the foregoing reasons, the Company requires additional time to
complete the procedures relating to its year-end reporting process,
including the completion of the Company's financial statements and
the audit thereof, updating relevant disclosures to reflect changes
to the Company's business as a result of the Acquisitions, and
completion of the procedures relating to management's assessment of
the effectiveness of internal controls, and the Company is
therefore unable to file the Annual Report by May 31, 2022, the
prescribed filing due date. The Company is working diligently to
complete the necessary work. The Company expects to file the
Annual Report within the extension period provided under Rule
12b-25 under the Securities Exchange Act of 1934, as amended.
About NextPlay Technologies
NextPlay Technologies, Inc. (formerly known as Monaker Group Inc.)
-- nextplaytechnologies.com -- is a technology solutions company
offering games, in-game advertising, crypto-banking, connected TV
and travel booking services to consumers and corporations within a
growing worldwide digital ecosystem. NextPlay's engaging products
and services utilize innovative AdTech, Artificial Intelligence and
Fintech solutions to leverage the strengths and channels of its
existing and acquired technologies.
The Company reported a net loss of $16.51 million for the year
ended Feb. 28, 2021, compared to a net loss of $9.45 million for
the year ended Feb. 29, 2020. As of Nov. 30, 2021, the Company had
$120.96 million in total assets, $31.01 million in total
liabilities, and $89.95 million in total stockholders' equity.
Sugar Land, Texas-based TPS Thayer, LLC, the Company's auditor
since 2020, issued a "going concern" qualification in its report
dated June 7, 2021, citing that the Company has suffered recurring
losses from operations and has stockholders' deficit that raise
substantial doubt about its ability to continue as a going concern.
NORTHERN ENERGY: Seeks Cash Collateral Access
---------------------------------------------
Northern Energy Solutions, LLC asks the U.S. Bankruptcy Court for
the District of New Jersey in Newark for authority to use cash
collateral and provide adequate protection.
The Debtor requires the use of cash collateral to fund payroll and
payroll taxes, maintain its relations with vendors and suppliers,
or pay for inventory, supplies, overhead, insurance and other
necessary expenses.
The U.S. Small Business Administration holds or might assert a lien
or security interest in the Debtor's cash, receivables, deposit
accounts, and other cash equivalents.
In May 2020, the Debtor applied for an Economic Injury Disaster
Loan through the SBA. The SBA approved and provided financing to
the Debtor and holds a UCC lien, asserting a security interest in
the Debtor's personal property. The SBA is owed approximately
$475,000 as of the petition date.
The value of the Debtor's tangible personal property has been
appraised at $36,300. The total of the Debtor's deposits as of the
petition date is approximately $12,166; its total collectable
accounts receivable as of the petition date is $40,511. Thus,
under Bankruptcy Code Sec. 506(a), the SBA's secured claim is
secured by the cash collateral to the extent of the value of the
cash collateral.
The Debtor proposes to provide adequate protection to the SBA for
its use of cash collateral by (1) making monthly payment to the SBA
in the amount of $1,450, and (2) granting a replacement lien to the
SBA on all of the Debtor's present and after acquired property, to
the extent of any diminishment of the value of the cash collateral
after the petition date.
The replacement liens granted as adequate protection will be junior
in priority only to any fees payable to the clerk of the court or
to the United States Trustee pursuant to 28 U.S.C. Sec. 1930.
It will be an event of default if (1) the Debtor fails to honor any
duty or obligation imposed upon it by the cash collateral order, or
has otherwise violated any condition of its use of cash collateral,
(2) the Debtor moves to dismiss or convert the case to one under
chapter 7, or (3) entry of an order vacating the automatic stay as
to the collateral covered by the replacement lien(s).
A copy of the motion is available at https://bit.ly/3GMhBp8 from
PacerMonitor.com.
About Northern Energy Solutions, LLC
Northern Energy Solutions, LLC operates an electrical installation,
management and maintenance business located at 79 4th Avenue,
Hawthorne, New Jersey 07506. The Debtor does not own the real
property.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. N.J. Case No. 22-14449) on June 3, 2022.
In the petition filed by Evangelo G. Petropoulos, owner and
president, the Debtor disclosed up to $100,000 in assets and up to
$1 million in liabilities.
Brian G. Hannon, Esq., at Norgaard, O'Boyle & Hannon is the
Debtor's counsel.
NRP LEASE: Unsecured Creditors to Split $600K in Plan
-----------------------------------------------------
NRP Lease Holdings, LLC, and its debtor-affiliates filed with the
U.S. Bankruptcy Court for the Middle District of Florida a
Disclosure Statement describing Plan of Reorganization dated June
2, 2022.
NRP Holdings is a leader in the regional family entertainment
center business. Through its operating subsidiaries, NRP Holdings
manages eleven parks in Florida, North Carolina, New York, Kansas,
Ohio, Texas and Missouri.
The Debtors has proposed the Plan as a means for dealing with its
debt burden. The Plan is intended to ensure that all creditors
receive as much or more than they would receive in a liquidation of
the Debtors' assets.
The Debtors have historically operated as a single economic unit
for administrative purposes, raising the specter of whether these
cases should be substantively consolidated.
As a result of the compromise and settlement of substantive
consolidation issues contained in the Plan, and only for purposes
of distributions under the Plan, except as otherwise provided in
the Plan, (a) all property of the Estate of each Debtor shall be
deemed to be property of the consolidated Estates; (b) all Claims
against each Estate shall be deemed to be Claims against the
consolidated Estates, any Proof of Claim filed against one or more
of the Debtors shall be deemed to be a single claim filed against
the consolidated Estates, and all duplicate Proofs of Claim for the
same claim filed against more than one Debtor shall be deemed
expunged; and (c) except as otherwise provided in the Plan, no
distributions under the Plan shall be made on account of
intercompany Claims.
Class 12 consists of General Unsecured Claims. Allowed Unsecured
Claims will share pro rata in a one-time distribution of $600,000
to be made within ninety (90) days of the Effective Date. In the
event the PPP Loans are forgiven, the Debtors shall also make eight
quarterly distributions of $22,500 each to Class 12 Claimants
beginning the first full calendar quarter after the PPP Loans are
forgiven.
There shall be no distribution on account of any Disputed Claim
until such objection or dispute is resolved by Final Order. The
Debtors shall, however, reserve funds to make the proportionate
distribution to such creditors until such time as all claim
objections have been finally determined. All funds reserved on
account of Disallowed Claims shall be distributed pro-rata to the
holders of Allowed Unsecured Claims at the conclusion of the claim
objection process. The Debtors may in their sole discretion, delay
making the initial distribution if it expects resolution of a
Disputed Claim within a reasonable time.
Class 13 consists of Equity Interests. All equity interests in the
Debtors shall be retained, and all rights and privileges of the
equity interest holders shall remain unaltered. This Class is
unimpaired.
The Plan will be funded from funds accumulated during the pendency
of these cases and from the continued operation of the Debtors'
business. Distributions to creditors shall be handled internally by
the Debtors on a consolidated basis as though the cases has been
substantively consolidated. No disbursing agent will be appointed.
Following the Effective Date, the Debtors shall (a) administer the
Plan, including without limitation, prosecuting and settling all
Recovery Actions and objecting to, or settling, any type or
Classification of Claims and Interests; (b) make Cash distributions
to the holders of Allowed Claims in accordance with the priorities
set forth herein; and (c) take such steps as are reasonably
necessary to accomplish such purposes, all as more fully provided
in, and subject to the terms and provisions herein and the
Confirmation Order.
According to the Debtors' records, unsecured claims currently total
$5,705,205 inclusive of the MCA Claims. However, in a liquidation
scenario, the unsecured creditors pool will likely increase by at
least $1,081,709 for deficiency claims assertable by Live Oak,
Betson and American Express following the liquidation of their
collateral.
Thus, if the cases were converted to Chapter 7, there would be no
distribution to prepetition unsecured creditors. The Plan, on the
other hand, proposes to pay all Administrative and Priority Claims
in full, plus an immediate payment of $600,000 to General Unsecured
Creditors, which translates to a distribution of approximately 17%
without further dilution.
A full-text copy of the Disclosure Statement dated June 02, 2022,
is available at https://bit.ly/3PYdpad from PacerMonitor.com at no
charge.
Attorneys for the Debtors:
Richard R. Thames, Esq.
Thames Markey & Heekin, P.A.
50 North Laura Street, Suite 1600
Jacksonville, FL 32202
Phone: (904) 358-4000
E-mail: rrt@tmhlaw.net
About NRP Lease Holdings
NRP Lease Holdings, LLC, and its debtor-affiliates are privately
held companies based in Jacksonville Beach, Florida.
NRP Lease Holdings and its affiliates that have filed voluntary
petitions seeking relief under Chapter 11 of the Bankruptcy Code
(Bankr. M.D. Fla. Lead Case No. 19-04607) on Dec. 5, 2019. The
petition was signed by Henry P. Woodburn III, manager. At the time
of filing, NRP Lease and Adventure Holdings each estimated $50,000
in assets and $1 million to $10 million in liabilities.
Richard R. Thames, Esq. at THAMES MARKEY & HEEKIN, P.A., is serving
as counsel to the Debtors.
NUTRIBAND INC: Incurs $690K Net Loss in First Quarter
-----------------------------------------------------
Nutriband Inc. filed with the Securities and Exchange Commission
its Quarterly Report on Form 10-Q disclosing a net loss of $689,989
on $477,922 of revenue for the three months ended April 30, 2022,
compared to a net loss of $315,057 on $433,488 of revenue for the
three months ended April 30, 2021.
As of April 30, 2022, the Company had $11.98 million in total
assets, $904,375 in total liabilities, and $11.08 million in total
stockholders' equity.
As of April 30, 2022, the Company had $4,010,644 in cash and cash
equivalents and working capital of $3,918,855, as compared with
cash and cash equivalents of $4,898,868 and working capital of
$4,686,112 as of Jan. 31, 2022. The Company received proceeds of
approximately $8.5 million from the completion of its public
offering, exercise of warrants and the sale of common stock during
the year ended Jan. 31, 2022.
For the three months ended April 30, 2022, the Company used cash of
$744,257 in its operations. The principal adjustments to its net
loss of $689,989 were depreciation and amortization of $77,475,
offset by changes in operating assets and liabilities of $146,728.
For the three months ended April 30, 2022, the Company used cash in
investing activities of $43,803 primarily for the purchase of
equipment.
For the three months ended April 30, 2022, the Company used cash in
financing activities of $93,164 primarily from the purchase of
treasury stock of $89,196.
"Management has prepared estimates of operations for fiscal year
2022 and 2023 believes that sufficient funds will be generated from
operations to fund its operations for one year from the date of the
filing of these condensed consolidated financial statements, which
indicates improved operations and the Company's ability to continue
operations as a going concern. The impact of COVID-19 on the
Company's business has been considered in these assumptions;
however, it is too early to know the full impact of COVD-19 or its
timing on a return to more normal operations," Nutriband said.
"Management believes the substantial doubt about the ability of the
Company to continue as a going concern is alleviated by the above
assessment," the Company said.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1676047/000121390022030469/f10q0422_nutribandinc.htm
About Nutriband
Nutriband Inc. -- www.nutriband.com -- is primarily engaged in the
development of a portfolio of transdermal pharmaceutical products.
Its lead product under development is an abuse deterrent fentanyl
patch incorporating its AVERSA abuse deterrence technology. AVERSA
technology can be incorporated into any transdermal patch to
prevent the abuse, misuse, diversion, and accidental exposure of
drugs with abuse potential.
Nutriband reported a net loss of $6.18 million for the year ended
Jan. 31, 2022, a net loss of $2.93 million for the year ended Jan.
31, 2021, a net loss of $2.72 million for the year ended Jan. 31,
2020, and a net loss of $3.33 million for the year ended
Jan. 31, 2019. As of Oct. 31, 2021, the Company had $15.43 million
in total assets, $1.11 million in total liabilities, and $14.32
million in total stockholders' equity.
OAKVIEW FARMS: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: Oakview Farms, LLC
5555 Fellowship Ln
Spring, TX 77379
Chapter 11 Petition Date: June 7, 2022
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 22-31588
Judge: Hon. Eduardo V. Rodriguez
Debtor's Counsel: Susan Tran Adams, Esq.
TRAN SINGH, LLP
2502 La Branch St.
Houston, TX 77004
Email: stran@ts-llp.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Travis Hudson, president of Manager, The
Texas Mortgage Group, Inc.
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/OMWLTPA/Oakview_Farms_LLC__txsbke-22-31588__0001.0.pdf?mcid=tGE4TAMA
OREGON TOOL: Moody's Cuts CFR to B3 & Alters Outlook to Negative
----------------------------------------------------------------
Moody's Investor Service downgraded Oregon Tool Holdings, Inc.'s
ratings including its Corporate Family Rating to B3 from B2 and its
Probability of Default Rating to B3-PD from B2-PD. Moody's also
downgraded the secured bank credit facility to B2 from B1 and
unsecured notes to Caa2 from Caa1. The outlook has changed to
negative from stable.
"The ratings downgrade and negative outlook are driven by Oregon
Tool's high leverage as a result of margin pressure from elevated
steel prices and freight costs. Weaker than expected margins and
working capital use has reduced liquidity to where Moody's no
longer believe the company will meaningfully reduce debt in 2022 or
2023," says Justin Remsen, Assistant Vice President at Moody's.
Downgrades:
Issuer: Oregon Tool Holdings, Inc.
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 B2 (LGD3) from
B1 (LGD3)
Senior Unsecured Regular Bond/Debenture, Downgraded to Caa2 (LGD5)
from Caa1 (LGD5)
Outlook Actions:
Issuer: Oregon Tool Holdings, Inc.
Outlook, Changed to Negative from Stable
RATINGS RATIONALE
Oregon Tool's B3 CFR reflects Moody's expectation that over the
next 18 months the company will maintain very high leverage
exceeding 7.5x debt/EBITDA. Moody's forward view assumes the
company's profitability will continue to be challenged by steel and
ocean container costs rising beyond price increases. Moody's
expects breakeven free cash flow in 2022 given pressured margins,
high interest burden, and working capital use with higher inventory
costs and growing receivables.
The rating also reflects historically low growth in the company's
primary end markets (forestry and agriculture). The forestry
segment has demonstrated stable growth historically, but demand for
lumber can be impacted by the cyclical housing market. Strengths
include the company's dominant global market share along with
strong brand recognition, and good channel diversification. Oregon
Tool generates a high percentage of revenue from consumable
products such as chainsaw bars and chains and lawnmower blades that
must be replaced frequently providing a recurring revenue stream.
Moody's forecasts that Oregon Tool will have adequate liquidity
over the next 12 to 18 months. Liquidity is supported by cash on
hand on December 31, 2021 of about $38 million. The company's
$150 million asset-based lending (ABL) revolver had $35 million
outstanding and $53 million additional borrowing available on
December 31, 2021. The company also has an undrawn $50 million
cash flow revolver. Both the $150 million ABL and $50 million
cash flow revolver are due October 2026. Moody's anticipates
breakeven cash flow in 2022 and free cash flow of $25 million in
2023, with margin and working capital improvements leading to a
modest recovery in cash flow.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company reduces debt/EBITDA to
below 6x, EBITA/interest above 2x, and strengthens liquidity with
free cash flow to debt above 5% and reduced revolver borrowings.
The ratings could be downgraded if debt/EBITDA is above 7x,
EBITA/interest falls below 1.0x, or liquidity deteriorates
including negative cash flow.
The principal methodology used in these ratings was Manufacturing
published in September 2021.
Oregon Tool Holdings, Inc., headquartered in Portland, Oregon, is a
global manufacturer and distributor of professional-grade,
consumable parts and attachments for use in forestry, lawn and
garden, agriculture and concrete cutting applications. Platinum
Equity, through its affiliates, is the owner of Oregon Tool.
PARKERVISION INC: To Sell $760K Unsecured Promissory Notes
----------------------------------------------------------
ParkerVision, Inc. entered into a securities purchase agreement
with accredited investors which provides for the sale of unsecured
convertible promissory notes with an aggregate face value of
$760,000. The Notes are convertible at any time and from time to
time by the Holders into shares of Common Stock at a fixed
conversion price of $0.13 per share. Any unconverted, outstanding
principal amount of the Notes is payable on June 2, 2027, unless
otherwise extended. The proceeds from the sale of the Notes will
be used to fund the Company's operations.
Interest accrues at a rate of 8% per annum on the Notes, and is
payable quarterly either in cash, shares of Common Stock, or a
combination thereof at the Company's option, subject to certain
equity conditions, on the 15th of April, July, October, and January
of each year during the five year term of the Note commencing with
the first Interest Payment Date following effective date of
registration of the underlying shares.
The Notes provide for events of default that include (i) failure to
pay principal or interest when due, (ii) any breach of any of the
representations, warranties, covenants or agreements made by the
Company in the Purchase Agreement, (iii) events of liquidation or
bankruptcy, and (iii) a change in control. In the event of
default, the interest rate increases to 12% per annum and the
outstanding principal balance of the Notes plus all accrued
interest due may be declared immediately payable by the holders of
a majority of the outstanding principal balance of the Notes.
The Company also entered into a registration rights agreement with
the Holders pursuant to which the Company will register the shares
of Common Stock underlying the Notes. The Company has committed to
file the registration statement by Aug. 11, 2022 and to cause the
registration statement to become effective by the 120th calendar
day following the issuance date. The Convertible Notes
Registration Rights Agreement provides for liquidated damages upon
the occurrence of certain events including failure by the Company
to file the registration statement or cause it to become effective
by the deadlines set forth above. The amount of the liquidated
damages is 1.0% of the aggregate subscription amount paid by the
Holders for the Notes upon the occurrence of the event, and monthly
thereafter, up to a maximum of 6%.
The Notes were offered and sold solely to accredited investors on a
private placement basis under Section 4(a)(2) of the Securities Act
of 1933, as amended, and Rule 506 promulgated thereunder.
About Parkervision
Headquartered in Jacksonville, Florida, ParkerVision, Inc.
(http://www.parkervision.com)has designed and developed
proprietary radio-frequency (RF) technologies that enable advanced
wireless solutions for current and next generation wireless
communication products. ParkerVision is engaged in a number of
patent enforcement actions in the U.S. to protect patented rights
that it believes are broadly infringed by others.
Parkervision reported a net loss of $12.33 million for the year
ended Dec. 31, 2021, a net loss of $19.58 million for the year
ended Dec. 31, 2020, and a net loss of $9.45 million for the year
ended Dec. 31, 2019. As of March 31, 2022, the Company had $2.41
million in total assets, $45.96 million in total liabilities, and a
total shareholders' deficit of $43.55 million.
Fort Lauderdale, Florida-based MSL, P.A., the Company's auditor
since 2019, issued a "going concern" qualification in its report
dated March 29, 2022, 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.
PREMIER MODERN: Case Summary & Nine Unsecured Creditors
-------------------------------------------------------
Debtor: Premier Modern Commercial Printing Company
Bass Printing Company
4620 S. Edgewood Terrace
Forth Worth, TX 76119
Business Description: Premier Modern is a printing company
specializing in digital printing, offset
printing, and wide-format inkjet UV-Led
printing.
Chapter 11 Petition Date: June 7, 2022
Court: United States Bankruptcy Court
Northern District of Texas
Case No.: 22-41296
Judge: Hon. Edward L. Morris
Debtor's Counsel: Michael S. Mitchell, Esq.
DEMARCO MITCHEL, PLLC
1255 West 15th St., 805
Plano, TX 75075
Tel: (972) 578-1400
Email: mike@demarcomitchell.com
Total Assets: $402,241
Total Liabilities: $3,664,976
The petition was signed by Alrick V. Warner, president and CEO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's nine unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/3XHYEKY/Premier_Modern_Commercial_Printing__txnbke-22-41296__0001.0.pdf?mcid=tGE4TAMA
PROJECT LEOPARD: Moody's Assigns B3 CFR & Rates First Lien Debt B2
------------------------------------------------------------------
Moody's Investors Service assigned Project Leopard Holdings, Inc.
(NEW) (dba Kofax) a B3 Corporate Family Rating and B3-PD
Probability of Default Rating. Concurrently, Moody's assigned a B2
rating to the proposed senior secured first lien credit facilities
($1,346 million term loan and $150 million revolver) and a Caa2
rating to the proposed $348 million senior secured second lien term
loan. The outlook is stable.
Net proceeds from the first lien and second lien term loans and
cash equity from private equity firms TA Associates and Clearlake
Capital will be used to acquire Kofax from Thoma Bravo for $2.3
billion.
Upon the full repayment of debt at the close of the transaction,
the CFR, PDR and existing debt instrument ratings for the company
under Thoma Bravo ownership will be withdrawn.
Assignments:
Issuer: Project Leopard Holdings, Inc. (NEW)
Corporate Family Rating, Assigned B3
Probability of Default Rating, Assigned B3-PD
Senior Secured 1st Lien Term Loan, Assigned B2 (LGD3)
Senior Secured 1st Lien Revolving Credit Facility, Assigned B2
(LGD3)
Senior Secured 2nd Lien Term Loan, Assigned Caa2 (LGD6)
Outlook Actions:
Issuer: Project Leopard Holdings, Inc. (NEW)
Outlook, Assigned Stable
RATINGS RATIONALE
Kofax's B3 CFR is constrained by the company's high pro forma
leverage of 7.3x debt/EBITDA as of December 31, 2021 (Moody's
adjusted), projected limited free cash flow generation and
expectation for aggressive financial policies, a key ESG
consideration. In addition, Kofax operates in mature and highly
competitive capture and print management markets that in Moody's
view have limited organic growth potential. The company is
undergoing a transition to a subscription based model from
perpetual license sales, which Moody's believes will put additional
pressure on Kofax's organic revenue growth over the next two to
three years. Moody's projects increased operating expenses required
to support the transition will reduce Kofax's profitability and
sustain leverage in the mid-7x range. Moody's also projects Kofax's
free cash flow generation to be weak over the next 12 to 18 months,
in the low single digits of debt, due primarily to the above
transition, increased debt load and rising interest rates.
Kofax benefits from its leading position in the multi-channel
capture and financial process automation software markets,
consistent maintenance renewal rates, and good geographic
diversification. Kofax will also experience greater revenue and
cash flow visibility as the proportion of its subscription license
and SaaS sales continues to grow.
Kofax's liquidity is good supported by a cash balance of $50
million at the close of the transaction and Moody's expectation for
free cash flow of around $20-25 million over the next 12 months.
Liquidity is also supported by a proposed $150 million revolver.
The revolver is expected to contain a 9.25x first lien net leverage
covenant, springing at 35% utilization. Kofax's cash flow exhibits
some seasonality as the company bills a significant portion of its
new perpetual licenses and maintenance contracts in December and
collects cash during the January through March period. The
company's capital expenditures are modest at about 1% of sales.
The stable outlook reflects Moody's expectation that Kofax's
subscription license and SaaS revenue will continue to show strong
growth and will largely offset the decline in perpetual license
sales as the company transitions to a recurring revenue model.
Moody's also expects that Kofax's leverage will remain in the
mid-7x range in the next 12 to 18 months with free cash flow to
debt in the low single digit percentage.
Similar to most security software providers, Kofax has limited
environmental risk. Social risks are considered moderate, in line
with the software sector. Broadly the main credit risks stemming
from social issues are linked to reputational risk, data security,
diversity in the workplace, and access to highly skilled workers.
Kofax will be privately held and will not have an independent Board
of Directors. Moody's expects financial policies will be aggressive
under private equity ownership as evidenced by the high leverage at
closing of the acquisition.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings for Kofax could be upgraded if organic revenue grows at
least low-to-mid single digits, leverage is expected to be
sustained under 6.5x, and free cash flow to debt approaches 5%. The
ratings could be downgraded if Kofax experiences revenue and
earnings decline such that free cash flow is negative or leverage
is sustained over 8x.
The proposed $1,346 million senior secured first lien term loan due
2029 and $150 million senior secured revolving credit facility due
2027 are rated B2, one notch above the B3 CFR, reflecting the
debt's most senior position in the capital structure ahead of the
$348 million senior secured second lien term loan (Caa2).
As proposed, the new credit facility is expected to provide
covenant flexibility that if utilized could negatively impact
creditors. Notable terms include the following:
Incremental debt capacity up to the greater of $242 million and
100% of pro forma consolidated EBITDA, plus unused capacity
reallocated from the general debt basket, plus unlimited amounts
subject to 5.5x pro forma first lien net leverage or leverage
neutral incurrence if incurred in connection with a permitted
acquisition or investment (if pari passu secured).
Amounts up to the greater of $484 million and 200% of pro forma
consolidated EBITDA may be incurred with an earlier maturity date
than the initial term loans.
There are no express "blocker" provisions which prohibit the
transfer of specified assets to unrestricted subsidiaries; such
transfers are permitted subject to carve-out capacity and other
conditions.
Non-wholly-owned subsidiaries are not required to provide
guarantees; dividends or transfers resulting in partial ownership
of subsidiary guarantors could jeopardize guarantees, with no
explicit protective provisions limiting such guarantee releases.
There are no express protective provisions prohibiting an
up-tiering transaction.
The credit facilities allow 200% of the restricted payments
capacity under the general carve-outs, ratio-based carve-outs,
management buyback carve-out along with 100% of the builder basket
capacity to be reallocated to increase debt incurrence capacity.
The credit facilities include EBITDA uncapped add-backs for
increased pricing or volume initiatives or expected new customer
agreements, as well as for any COVID-19 related costs.
The proposed terms and the final terms of the credit agreement may
be materially different.
The principal methodology used in these ratings was Software
Industry published in August 2018.
Project Leopard Holdings, Inc. (NEW) is a leading provider of
multi-channel capture and business process management software. The
company generated revenue of $554 million in 2021. The company is
being acquired by TA Associates and Clearlake Capital from Thoma
Bravo for $2.3 billion.
QHC FACILITIES: Resident-Care Issues Scuttle Nursing Home Sale
--------------------------------------------------------------
Clark Kauffman of Iowa Capital Dispatch reports that the planned
sale of a troubled Iowa nursing home chain to an East Coast
developer has been scuttled partly due to quality-of-care issues.
QHC Facilities, which owns eight skilled-nursing facilities and two
assisted-living centers in Iowa, filed for bankruptcy in late
December 2021. The previous owner of the company, Jerry Voyna, died
last year. His wife, Nancy, took over the company and filed for
bankruptcy soon after. She died in January, leaving the company to
her son, who began pursuing a sale of the company and all of its
assets.
In early March, a federal bankruptcy court judge approved the sale
of QHC to Cedar Health Group, a holding company based in Lakewood,
N.J. Cedar is part of a network of companies run by real estate
developer Mark Tress, who specializes in acquiring distressed
properties.
The sale, however, ran aground when Cedar Health began raising
questions about quality-of-care issues that could impact the
licenses for QHC’s care facilities.
In newly filed court records, Cedar Health says it inquired about
the possibility of purchasing some or all of the assets of QHC, but
backed out when it learned the sale would be conducted by auction.
QHC claims that “almost literally within one or two hours” of
the March 4 auction, a QHC broker urged Cedar Health to bid on the
chain, even though Cedar Health had not completed all of the
pre-bid requirements. Cedar Health says it agreed to participate in
the auction, which resulted in the only competing bidder, Blue
Diamond, objecting due to the pre-bidding requirements not being
met.
According to Cedar Health, QHC waived the pre-bidding requirements
for Cedar Health because it was "keen on having more than one
bidder." Cedar Health then emerged as the high bidder at $12.1
million, and it quickly turned over a deposit of $605,000.
By March 22, 2022, however, the sale appeared to be at risk. Court
records show that legal counsel for Cedar Health wrote to QHC’s
representatives, explaining that Cedar Health was trying to
“determine whether any of the facilities are in imminent danger
of decertification” due to quality-of-care issues. The attorney
also noted that two of the QHC homes had been designated Special
Focus Facilities by the federal government, indicating a long,
uncorrected pattern of serious violations.
In addition, the legal counsel said, Cedar Health had yet to
determine whether quality-of-care citations issued by regulators
were going to "endanger the licensure of the facilities."
QHC’s representatives wrote back, pointing out the time to
perform that sort of due diligence was before the auction, not
after, and that qualified bidders had agreed that if they submitted
the winning bid, they would take over management of the nursing
home chain no later than March 18, 2022.
"We are now past that deadline however with no signed management
agreement or firm commitment," QHC's lawyer told Cedar Health. "We
would like to see this transaction go forward still and want to
work with you … However, we have the health, safety, and welfare
of residents and patients to think about. As such, if signed
management agreements and a commitment to wire $500,000 today is
not received by noon CST today, we have no choice but to file an
emergency motion with the court to request a hearing on this
matter, which will include approval to move forward with the backup
bidder."
Cedar Health then offered QHC $250,000 and asked for more time so
that it could gather information on the regulatory issues. QHC
refused, and then went to court to secure an emergency order
allowing the chain to be sold to Blue Diamond, the backup bidder.
The court agreed to QHC's request, and on March 24, Judge Anita L.
Shodeen ruled that due to "the current financial instability" of
the QHC nursing homes and the lack of a completed management
agreement, she was authorizing the sale of the chain to Blue
Diamond.
The “unknown status of the transaction” with Cedar Health, she
ruled, “endangers the health, safety and welfare of the
residents” of the QHC facilities. Cedar Health is now seeking the
return of its deposit, and QHC is resisting.
Still to be determined is the fate of a wrongful death claim made
by the family of Gladys Van Sickle, who died after allegedly
sustaining broken bones in a fall at QHC’s Winterset North
facility in Madison County. A trial in that case is scheduled for
October 2023, but the bankruptcy court may first have to deal with
the status of QHC’s insurance once the sale to Blue Diamond is
completed.
QHC’s 10 Iowa care facilities have a combined capacity of almost
750 residents. The facilities are: QHC Mitchellville, QHC Winterset
North, QHC Winterset South, QHC Madison Square, QHC Fort Dodge
Villa, QHC Crestridge, QHC Crestview Acres in Marion, QHC Humboldt
North, QHC Humboldt South and QHC Villa Cottages of Fort Dodge.
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.
Bradshaw Fowler Proctor & Fairgrave, PC and Dentons Davis Brown,
P.C. are the Debtors' bankruptcy counsels. Newmark Real Estate of
Dallas, LLC, and Gibbins Advisors, LLC, serve as the Debtors'
investment banker and restructuring advisor, respectively.
The U.S. Trustee for Region 12 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases. Troutman
Pepper Hamilton Sanders, LLP and Cutler Law Firm, P.C. serve as the
committee's lead bankruptcy counsel and local counsel,
respectively.
QUALITAT DRYWALL: Drywall Contractor Files Subchapter V Case
------------------------------------------------------------
Qualitat Drywall, LLC, filed for bankruptcy protection, seeking
relief under Subchapter V of Chapter 11 of the Bankruptcy Code.
The Debtor is a licensed California drywall installer. The Debtor
disclosed total assets of $215,243 against liabilities of
$1,126,218 as of March 31, 2022.
According to court documents, Qualitat Drywall estimates between 1
and 49 unsecured creditors. The petition states that funds will be
available to unsecured creditors.
A telephonic meeting of creditors under 11 U.S.C. Section 341(a) is
slated for June 28, 2022 at 9:30 A.M.
A status conference on the Debtor's Chapter 11 petition is
scheduled for July 7, 2022, at 2:00 p.m.
About Qualitat Drywall
Qualitat Drywall LLC -- https://qualitatdrywall.com/ -- is a
drywall contractor in Southern California.
Qualitat Drywall sought protection under Subchapter V of Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D. Cal. Case No. 22-01405) on
May 27, 2022. In the petition filed by Heriberto Gonzalez, as
managing member, Qualitat Drywall estimated assets between $100,000
and $500,000 and estimated liabilities between $500,000 and $1
million.
Jean Goddard has been appointed as Subchapter V trustee.
The Debtor's counsel:
Steven E. Cowen
S.E. Cowen Law
Tel: (619) 202-7511
E-mail: cowen.steve@secowenlaw.com
RALSTON-LIPPINCOTT: Seeks Cash Collateral Access
------------------------------------------------
Ralston-Lippincott-Hasbrouck-Ingrassia Funeral Home, Inc. and CKI,
LLC ask the U.S. Bankruptcy Court for the Southern District of New
York for authority to use cash collateral and provide adequate
protection.
CKI owns improved real estate located at 4 Oak Street, Greenwood
Lake, New York 10925. The Greenwood Lake Property is rented to
non-debtor affiliate Caitant, Inc., dba Strong Basile Funeral Home,
which operates that property as a funeral home affiliated with
RLHI.
During the 30-day interim postpetition period, CKI projects net
revenue before debt service of approximately $5,835, and RLHI
projects net revenue before debt service of approximately $11,090.
Debtor CKI seeks to use the rents from the Greenwood Lake Property
to pay necessary business expenses, including the necessary
carrying costs of the Greenwood Lake Property.
Debtor RLHI seeks to use the proceeds from the operation of its
funeral business to pay necessary business expenses and expenses of
administration.
The Debtors are (some of) the Borrowers and OBT is the Lender under
a series of consolidated loan agreements1 evidenced by a series of
underlying Notes and Mortgages for each of the Debtors' locations,
as consolidated, modified and extended by a series of
Consolidation, Extension & Modification Agreements dated February
28, 2013. The Notes, Mortgages, Assignments of Rents and the
Agreements provide for a consolidated real estate loan facility.
As participants in the Loan, each of the Debtors guaranteed the
obligations of the others, and pledged their property as further
collateral for their guarantees.
At the time of the consolidation and during the prior jointly
administered chapter 11 cases, there were four borrowers: lead
debtor RLHI, Case No. 17-35114; and its three affiliated debtors,
Lippincott-Ingrassia Funeral Home, Inc., Case No. 17-35115;
Lippincott Funeral Chapel, Inc., Case No. 17-35116; and CKI, Case
No. 17-35117.
The four debtors filed their Debtors' Joint Plan of Reorganization
and then confirmed the Prior Plan (17-35114, ECF No. 109, filed and
entered 4/6/18).
The Prior Plan called for, inter alia, the sale of the real
properties owned by Lippincott-Ingrassia Funeral Home, Inc. and
Lippincott Funeral Chapel, Inc., payment of the net proceeds of
sale, to be followed by the recasting of the Loan to reflect the
pay down from each sale.
Both properties were sold and the net proceeds of sale from each
closing were paid to OBT. It is unclear whether OBT recast the Loan
after each sale. Accordingly, the Debtors are unable to determine
the balance remaining on the Loan at this time.
In connection with the Loan, OBT filed UCC Financing and
Continuation Statements with the New York Department of State with
respect to rights asserted in Debtor RLHI, which rights, on
information and belief, purport to extend to all of that Debtor’s
personal property, tangible and intangible.
As adequate protection of OBT's security interest in and to
Debtor’s rents and operating revenue on an interim basis, and
pending determination of the remaining Loan balance and a final
hearing on the use of cash collateral, the Debtor seeks (i) the
Court's approval for use of OBT's cash collateral in consideration
of replacement lien(s) granted pursuant to Bankruptcy Code section
361(2) to the extent of such liens before the Petition Date; (ii)
the current payment of postpetition taxes and insurance on the
Debtors' two remaining properties; and (iii) financial reporting in
the form of the Debtor's monthly operating reports as required by
the Office of the United States Trustee, when filed.
A hearing on the matter is scheduled for June 28, 2022 at 9 a.m.
via zoom.gov.
A copy of the motion is available at https://bit.ly/3zdcXi3 from
PacerMonitor.com.
About Ralston-Lippincott-Hasbrouck-Ingrassia
Funeral Home, Inc.
Ralston-Lippincott-Hasbrouck-Ingrassia Funeral Home, Inc.,
Lippincott-Ingrassia Funeral Home, Inc., Lippincott Funeral Chapel,
Inc., and CKI, LLC, filed Chapter 11 petitions (Bankr. S.D.N.Y.
Case Nos. 22-35340 and 4:22-bk-35339, respectively) on May 19,
2022. Anthony Ingrassia, president, signed the petitions.
Ralston-Lippincott-Hasbrouck-Ingrassia disclosed $10 million in
both assets and liabilities.
The Debtors are represented by Mike Pinsky, Esq., at Hayward,
Parker, O'Leary & Pinsky.
RCO INC: Files Emergency Bid to Use Cash Collateral
---------------------------------------------------
RCO, Inc. asks the U.S. Bankruptcy Court for the District of
Nebraska to use the cash collateral of the U.S. Small Business
Administration in accordance with the proposed budget, with a 15%
variance and provide adequate protection.
The Debtor requires the use of cash collateral to sustain
sufficient working capital to finance its ongoing post-petition
business operations until it confirms a plan of reorganization.
Emergency relief is warranted under the circumstances as the Debtor
has ongoing operations and jobs. In the event the Debtor is unable
to operate and pay its ordinary course expenses, including payroll,
the Debtor would likely be forced to shutter its doors.
As with millions of businesses throughout the U.S. in the past
three years, the COVID-19 pandemic has taken its toll on the
Debtor's operations. This is particularly true given the Debtor's
business is heavily reliant on the construction supply chains and
labor forces to obtain materials and manpower. While the pandemic
has had a tremendous and largely negative impact on the
construction industry, hope remains that the construction will
continue and rebound as a result of high demand for construction
related services. Juxtaposed against this hope is ongoing labor
shortages, supply chain delays, project delays, material cost
increases, and the like. Yet, Debtor has remained.
Nevertheless, the Debtor has found itself faced with approximately
seven lawsuits from disgruntled customers and several other
financial pressure points that made operations unsustainable under
the current circumstances. In an effort to maintain operations,
reduce debt, and put an end to expensive litigation, the Debtor,
after having weighed a number of alternatives, made the decision to
file the instant case.
As of the Petition Date, all or substantially all of the assets of
the Debtor, subject to 11 U.S.C. sections 506, 552, are subject to
the liens and security interests of the SBA, who filed a UCC-1
financing statement with the Nebraska Secretary of State at Filing
9820197269-1 on June 13, 2020. In addition, the Debtor has entered
into several prepetition loan documents with the SBA including:
a. Loan Authorization Agreement dated June 5, 2020, as Loan
Number 8509657806;
b. Promissory Note dated June 5, 2020
c. Security Agreement dated June 5, 2020;
d. Amended Loan Authorization Agreement dated February 1,
2022;
e. 1st Modification to Note dated February 1, 2022; and
f. Amended Security Agreement dated February 1, 2022.
In addition, all or substantially all of the assets of the Debtor,
subject to 11 U.S.C. sections 506, 552, are subject to the liens
and security interests of a number of entities, including:
a. DLR Inc., who filed a UCC-1 financing statement with the
Nebraska Secretary of State at Filing 9818037754-2 on March 20,
2018. Debtor believes this is an unreleased lien and Debtor does
not owe any funds to DLR;
b. Arbor Bank who filed a UCC-1 financing statement with the
Nebraska Secretary of State at Filing 9820214799-6 on August 22,
2020. Debtor believes this is an unreleased lien and Debtor does
not owe any funds to Arbor Bank;
c. The Nebraska Enterprise Fund, who filed a UCC-1 financing
statement with the Nebraska Secretary of State at Filing
9820229401-1 on October 29, 2020;
d. Creditor 1, who filed, through an agent called First
Corporate Solutions, as representative, a UCC-1 financing statement
with the Nebraska Secretary of State at Filing 9721271282-2 on June
22, 2021. The Debtor has not been able to identify the name of the
creditor for whom this UCC-1 was filed;
e. The IRS, who filed tax liens with the Nebraska Secretary of
State at Filings 2111001053-8, 2112000108-9 on November 19, 2021,
and December 2, 2021, respectively;
f. CFG Merchant Solutions, who filed a UCC-1 financing
statement with the Nebraska Secretary of State at Filing
9721319839-8 on December 29, 2021;
g. White Road Capital LLC, Series: 58766, D/B/A: GFE Holdings,
who filed a UCC-1 financing statement with the Nebraska Secretary
of State at Filing 9721320266-6 on December 30, 2021; and
h. The IRS, who filed a tax lien with the Nebraska Secretary
of State at Filing 2203000891-1 on March 15, 2022.
As adequate protection, the Debtor proposes to provide the SBA
continuing, valid, binding, enforceable, non-avoidable, and
perfected postpetition security interests in and liens on the
Prepetition Collateral.
The SBA's liens and security interests in the Prepetition
Collateral will continue to attach to the Debtor's post-petition
assets of the same kind and to the same extent the liens were
effective or valid with respect to the Prepetition Collateral.
A copy of the motion and the Debtor's budget for the period from
June to September 2022 is available at https://bit.ly/3Q0ORwX from
PacerMonitor.com.
The Debtor projects $328,283 in total income and $281,026 in total
expenses for the period.
About RCO Inc.
RCO Inc. is a multipurpose general contractor that engages in
residential and commercial construction operations. The Debtor
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. D. Neb. Case No. 22-80398) on May 26, 2022. In the petition
filed by Chad Trout, president, the Debtor disclosed up to $500,000
in assets and up to $10 million in liabilities.
Judge Brian S. Kruse oversees the case.
Patrick R. Turner, Esq., at Turner Legal Group, LLC is the Debtor's
counsel.
REAL GRANITE: Unsecured Creditors to Split $250K in 3 Years
-----------------------------------------------------------
Real Granite, Inc., submitted an Amended Plan of Reorganization
dated June 2, 2022.
The Debtor filed this case to preserve and maximize the value of
its assets and provide an appropriate repayment plan for the
benefit of all creditors and stakeholders. In this Plan, the Debtor
proposes to reorganize and pay existing debts from future income
generated from operations. The Debtor believes the terms of this
Plan will maximize distributions to the creditors of and interest
holders in the Debtor to emerge from bankruptcy with the ability to
meet future ongoing obligations.
Class 3 consists of the Allowed Secured Claims of Frost Bank. The
combined claims of Frost total the amount of $1,273,207.43 (as of
January 18, 2022) and will be repaid through monthly payments of
principal and interest (7.5%) based upon a 15 year amortization
with a 3 year balloon, in the projected amount of $11,800.00. The
Debtor's 100% owner (Roland Martinez) owns real property which is
also pledged to Frost and listed for sale, which when sold will be
used to pay down the secured claims of Frost.
The Debtor's 100% owner, Roland Martinez, also has his own secured
loans with Frost which are cross-collateralized with the Debtor's
collateral. The combined debt of the Debtor and Roland Martinez to
Frost is approximately $2,200,000.00. Mr. Martinez has been
exploring the options of selling and/or refinancing the real
property (office building), in an effort to assist the Debtor with
its operations/reorganization efforts in this Chapter 11 bankruptcy
case, as well as satisfy his obligations to Frost.
The Debtor and Mr. Martinez are not sure that this is the best way
to go. Alternatively, Mr. Martinez is looking into refinancing the
real property, which is projected to generate between $1.8-$1.9
million, all of which would be payable to Frost on its secured
claims. Under either scenario, a much smaller balance will remain
owing to Frost to be paid in full through the Plan. Suretec has a
lien that is secondary to Frost, and which does not appear will
receive any proceeds based on the prior lien of Frost. Mr. Martinez
hopes to have this matter completed in the next 6 months.
Any remaining balance owing to Frost under this Plan will be
repaid. The net effect of whether the real property is sold or
refinanced is fairly equal, and should have no real impact on the
available cash flow going forward under the Plan. If Mr. Martinez
sells the office building the cost of the leaseback is
approximately $18,000.00/month. If the real property is refinanced,
the projected payments will be in the amount of $13,000.00 plus
taxes and insurance, which will be similar to the lease payments.
Additionally, under either scenario, a much smaller balance of
between $200,000.00 - $400,000.00 is projected to still be owing to
Frost, and will need to be paid pursuant to the payment provisions
set forth in the repayment terms.
Class 10 consists of general unsecured creditors of the Estate. The
total amount of Class 10 total the amount of $12,345,913.00, which
is projected to be reduced significantly based upon the estimated
unliquidated claims of Hunt (6,267,420.00) and Suretec
($4,859,672.09) which amount should drop significantly upon their
respective claims being liquidated.
The general unsecured claims are to be paid on a pro-rata basis for
period of 3 years from the confirmation of the Plan based upon the
monthly disposable income. Based upon the Debtor's projections,
Class 10 general unsecured creditors will receive approximately
$250,000.00 over the life of the Plan, with such payments being
divided among Class 1 unsecured creditors on a pro-rata basis. The
Class 10 general unsecured creditors is impaired.
The obligations under the Plan will be funded by the operation of
the Reorganized Debtor's business.
A full-text copy of the Amended Plan of Reorganization dated June
02, 2022, is available at https://bit.ly/3tlSq7l from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
David S. Gragg, Esq.
William R. Davis, Jr., Esq.
Langley & Banack, Inc.
745 E. Mulberry, Suite 700
San Antonio, TX 78212
Telephone: (210) 736-6600
Facsimile: (210) 735-6889
Email: wrdavis@langleybanack.com
About Real Granite Inc.
Real Granite, Inc., specializes in commercial tile and stone
installation, residential granite, marble and stone fabrication and
installation. The company is based in San Antonio, Texas.
Real Granite filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. W.D. Tex. Case No. 22-50050) on
Jan. 18, 2022, listing $2,596,812 in assets and $2,843,279 in
liabilities. Roland Martinez, president of Real Granite, signed
the petition.
Judge Craig A. Gargotta presides over the case.
David S. Gragg, Esq., and William R. Davis Jr., Esq., at Langley &
Banack, Inc., serve as the Debtor's attorneys.
RED RIVER: July 1 Hearing on Disclosure Statement
-------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas will
convene a hearing on July 1, 2022 at 9:30 a.m. (Prevailing Central
Time), to consider conditional approval of the Disclosure Statement
of Red River Waste Solutions, LP. The deadline to object to the
Disclosure Statement will be on June 29, 2022.
Red River Waste Solutions filed a motion seeking an order:
(a) Approving the Disclosure Statement for the First Amended
Chapter 11 Plan for Red River Waste Solutions, LP (as may be
amended, supplemented, or otherwise modified from time to time, the
"Disclosure Statement"), filed contemporaneously with the Motion;
(b) Establishing procedures for the solicitation and tabulation
of votes to accept or reject the First Amended Chapter 11 Plan for
Red River Waste Solutions filed contemporaneously with the Motion;
(c) Scheduling a hearing on the confirmation of the Plan for
August 11, 2022, at 9:30 a.m. (prevailing Central Time) or such
other time as is convenient for the Court;
(d) Establishing voting and objection deadlines in connection
with the Plan;
(e) Approving forms of ballot, notices, and a Solicitation
Package;
(f) Approving the Debtor's proposed procedures for noticing,
balloting, solicitation of votes, and voting; and g) Authorizing
the Debtor to include a letter of the Committee in support of the
Plan in the Solicitation Package.
The Debtor requests that the Court schedule:
-- a confirmation hearing for August 11, 2022, at 9:30 a.m.
(prevailing Central Time), or such other time as is convenient to
the Court.
-- a deadline of August 2, 2022, at 5:00 p.m. (prevailing
Central Time) for objections to confirmation of the Plan.
-- a voting deadline of 5:00 p.m. (prevailing Central Time) on
August 2, 2022.
-- Replies, if any, and brief in support of the Plan by not
later than August 8, 2022.
-- A "Voting Record Date" of June 29, 2022.
The Debtor asks that if a creditor files a motion seeking to have
its Claim temporarily allowed for voting purposes, the Court set
the deadline for filing and serving 3018 Motions as July 15, 2022.
The deadline for filing objections to the 3018 Motions, if any, as
July 29, 2022.
Counsel for the Debtor:
Marcus A. Helt, Esq.
Jane A. Gerber, Esq.
MCDERMOTT WILL & EMERY LLP
2501 North Harwood Street, Suite 1900
Dallas, Texas 75201
Tel: (214) 210-2821
Fax: (972) 528-5765
E-mail: mhelt@mwe.com
jagerber@mwe.com
About Red River Waste Solutions
Red River Waste Solutions LP is a company in Dripping Springs,
Texas, that provides waste management services. It also offers
solid waste and garbage pickup, recycling, industrial waste
collection, disposal, and landfill management services.
Red River Waste Solutions sought Chapter 11 protection (Bankr. N.D.
Texas Case No. 21-42423) on Oct. 14, 2021, listing up to $50
million in assets and up to $100 million in liabilities. James
Calandra, chief restructuring officer of Red River Waste Solutions,
signed the petition.
Judge Morris oversees the case.
Marcus Alan Helt, Esq., at McDermott Will & Emery LLP, is the
Debtor's legal counsel. Stretto, Inc. is the claims and noticing
agent.
The Debtor's official committee of unsecured creditors tapped
Womble Bond Dickinson (US) LLP as legal counsel and Rock Creek
Advisors, LLC as financial advisor.
REDWOOD EMPIRE: Wins Cash Collateral Access Thru July 31
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona authorized
Redwood Empire Lodging, LP to use cash collateral on an interim
basis in accordance with the budget and provide adequate protection
through July 31, 2022.
The Debtor is permitted to use cash collateral to pay postpetition
expenses only in the amounts, and only for the purposes, specified
in the budgets, subject to a 10% allowed line-item variance.
The Court ruled that the Debtor will not make any payment to any
professional employed under Bankruptcy Code section 327 before
interim or final (as applicable) approval of such professional's
application for payment of such fees and costs. The Debtor,
however, may pay any fees owed to the Office of the United States
Trustee, without regard to any amount set forth in the Operating
Budgets.
In addition to the replacement liens granted to the Debtor's
Lenders under the previous Interim Cash Collateral Orders entered
by the Court, the Lenders are granted as adequate protection, valid
and perfected security interests in the Debtor's postpetition
assets of the same type and to the same extent and priority (if
any) as existed prior to the Petition Date.
During the pendency of the Interim Order, the Debtor will maintain
insurance on the Lenders' physical collateral and will provide
proof of insurance to its secured creditors in addition to what the
Debtor provided on June 25, 2021, promptly following a written
request.
The Debtor will segregate all proceeds from each of the Hotels in
separate operating accounts and will not commingle funds in the
Savings Account with the operating accounts as provided in the
Order (I) Authorizing, But Not Directing (A) Continued Use of
Debtor's Cash Management System, And (B) Continued Use of Debtor's
Existing Bank Accounts, And (II) Granting Related Relief.
With respect to the cash collateral relating to the Page Hotel, the
Debtor will maintain at all times a minimum aggregate balance of
the Page Hotel's bank accounts of $116,000, and any funds needed to
pay for expenses of the Page Hotel that would otherwise cause the
aggregate balance to fall below $116,000 will be funded from the
Debtor's "savings account" consisting of funds that are not cash
collateral of any secured creditor in the Bankruptcy Case. If the
aggregate balance of the Page Hotel's bank accounts at any time
falls below $116,000, the Debtor will cause funds to be deposited
into such bank accounts to replenish such accounts to at least
$116,000.
These events constitute an "Event of Default:"
a. The Debtor is in breach of its agreements or undertakings,
provided that with respect to any report that any Lender claims has
not been provided, the Lender will provide written notice to the
Debtor relating to such report and the Debtor will have two
business days to cure;
b. The Debtor furnishes or knowingly makes any false,
inaccurate, or incomplete representation, warranty, certificate,
report or summary in connection with or under the Order;
c. The appointment of a trustee in the Debtor's Bankruptcy
Case;
d. The dismissal of the Debtor's Bankruptcy Case;
e. Except as permitted, the use of Cash Collateral under
Bankruptcy Code section 363(c) without the Lenders' prior written
consent;
f. Best Western International, Inc. or any of its affiliates
obtains a final order granting relief from the automatic stay
applicable under Bankruptcy Code section 362 in the Debtor's
Bankruptcy Case to exercise any of their rights under or terminate
the membership agreements between Best Western and the Debtor (and
then cash collateral will cease as to the affected Hotel);
g. Any person or entity obtains a final order granting relief
from the automatic stay with respect to the Lenders' collateral
(and then cash collateral will cease as to the affected Hotel);
h. A further interim order approving the Debtor's use of cash
collateral is not entered by the Court on or the expiration of the
Second Interim Period;
i. The Debtor's Bankruptcy Case is converted to a case under
Chapter 7 of the Bankruptcy Code;
j. The Debtor will sell either of its Hotels without either
(i) the applicable secured creditor's written consent (and in its
sole and absolute discretion), or (ii) Court order after notice and
a hearing;
k. The Debtor's filing of a motion to abandon its interest in
either of the Hotels;
l. The Debtor's failure to maintain insurance in amounts and
types as may be required under applicable loan and security
documents, subject to 10 business days' written notice and
opportunity to cure; or
m. The Debtor's failure to cause all applicable sales and bed
taxes to be paid on or before their due dates, or the Debtor's
failure to provide the Lenders with evidence thereof subject to
five business days written notice from the Lender and opportunity
to cure.
The Court has not determined if or to what extent the Lenders hold
valid security interests in the cash collateral or any other
collateral. In this regard, the Debtor fully reserves all of its
rights to challenge any of the security interests that may be
asserted by the Lenders, and the Lenders fully reserve all of their
rights to assert alleged claims and liens in the cash collateral
(and any other property). The Debtor has confirmed the authenticity
of Pacific Premier's, Poppy's, and S&K's loan documents, which
confirmation will be binding on the Debtor.
The next hearing on the matter is scheduled for June 15 at 1:30
a.m.
A copy of the order and the Debtor's 12-week budget is available at
https://bit.ly/3maeazf from PacerMonitor.com.
The budget provides for total expenses, on a weekly basis, as
follows:
$132,992 for Week 1;
$68,350 for Week 2;
$86,090 for Week 3;
$98,647 for Week 4;
$99,050 for Week 5;
$68,600 for Week 6;
$96,259 for Week 7;
$105,284 for Week 8;
$139,599 for Week 9;
$28,120 for Week 10;
$141,147 for Week 11; and
$109,719 for Week 12.
About Redwood Empire Lodging, LP
Redwood Empire Lodging, LP owns and operates two hotels: the Best
Western Plus located at 208 N Lake Powell Boulevard, Page, Arizona
86040, and the Best Western Sonoma Winegrower's Inn, located at
6500 Redwood Drive, Rohnert Park, California 94928.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case No. 21-04678) on June 16,
2021. In the petition signed by Debra Heckert, member, the Debtor
disclosed up to $50 million in both assets and liabilities.
Judge Eddward P. Ballinger Jr. is assigned to the case.
Isaac M. Gabriel, Esq., at Quarles & Brady LLP is the Debtor's
counsel.
REGIONAL HEALTH: Adjourns Special Meeting Until July 25
-------------------------------------------------------
Regional Health Properties, Inc. convened its special meeting of
holders of its 10.875% Series A Cumulative Redeemable Preferred
Shares and holders of its common stock, no par value, on May 31,
2022. At the Special Meeting, the holders of Series A Preferred
Stock and the holders of Common Stock, voting together as a single
class, approved the adjournment of the Special Meeting for the
purpose of soliciting additional votes for the approval of the
Required Proposals (as defined in the Proxy Statement/Prospectus),
and the Special Meeting was adjourned.
The Special Meeting will be reconvened on Monday, July 25, 2022 at
10:00 a.m., Eastern Time, at Sonesta Gwinnett Place Atlanta,
located at 1775 Pleasant Hill Road, Duluth, Georgia. The record
date for determination of the holders of Series A Preferred Stock
and the holders of Common Stock entitled to notice of, and to vote
at, the reconvened Special Meeting remains the close of business on
Feb. 24, 2022.
Any proxies previously submitted by the holders of Series A
Preferred Stock and the holders of Common Stock with respect to the
Special Meeting convened and adjourned on May 31, 2022 will
continue to be counted. Such holders need not submit a new proxy
for their votes to be counted. The holders of Series A Preferred
Stock and the holders of Common Stock may revoke their proxies as
set forth in the Proxy Statement/Prospectus.
As previously announced, the Company commenced an offer to exchange
any and all of its outstanding Series A Preferred Stock for newly
issued shares of the Company's 12.5% Series B Cumulative Redeemable
Preferred Shares. The Company is extending the expiration date for
the Exchange Offer from 5:00 p.m., New York City time, on May 31,
2022 to 5:00 p.m., New York City time, on July 25, 2022 to allow
additional time for the holders of Series A Preferred Stock to
tender their shares of Series A Preferred Stock in the Exchange
Offer. As of 5:00 p.m., New York City time, on May 31, 2022,
2,307,609 shares of Series A Preferred Stock had been properly
tendered (and not validly withdrawn) in the Exchange Offer.
Morrow Sodali LLC is acting as the Information Agent in connection
with the Exchange Offer and as the Proxy Solicitor in connection
with the Special Meeting, and Continental Stock Transfer & Trust
Company, the Company's transfer agent, is acting as the Exchange
Agent in connection with the Exchange Offer.
The complete terms and conditions of the Exchange Offer are set
forth in the Proxy Statement/Prospectus that are filed with the
U.S. Securities and Exchange Commission under cover of Schedule
TO/13E-3 and were sent to holders of the existing Series A
Preferred Stock and Common Stock, as applicable. The Proxy
Statement/Prospectus and the notice of the Special Meeting were
mailed to holders of record of Series A Preferred Stock and holders
of record of Common Stock as of the close of business on Feb. 24,
2022 beginning on or about Feb. 28, 2022. Free copies of the Proxy
Statement/Prospectus, the related Letter of Transmittal and all
other documents containing important information about RHE and the
Exchange Offer can be obtained through the SEC's website at
www.sec.gov or by contacting the Information Agent and Proxy
Solicitor, Morrow Sodali LLC, at (203) 658-9400 for banks and
brokers (collect) and (800) 662-5200 for all other callers (toll
free).
About Regional Health Properties
Regional Health Properties, Inc. (NYSE American: RHE) (NYSE
American: RHEpA) -- http://www.regionalhealthproperties.com-- is a
self-managed healthcare real estate investment company that invests
primarily in real estate purposed for senior living and long-term
healthcare through facility lease and sub-lease transactions.
Regional Health a net loss of $1.18 million for the year ended Dec.
31, 2021, and a net loss of $688,000 for the year ended Dec. 31,
2020. As of Dec. 31, 2021, the Company had $105.70 million in
total assets, $95.30 million in total liabilities, and $10.40
million in total stockholders' equity.
REGIONAL HEALTH: Receives Noncompliance Notice From NYSE
--------------------------------------------------------
Regional Health Properties, Inc. received an official notice of
noncompliance from NYSE American LLC on May 24, 2022, stating that
the Company is not in compliance with the Exchange's continued
listing standards under the timely filing criteria outlined in
Section 1007 of the Exchange's Company Guide because the Company
failed to timely file its Quarterly Report on Form 10-Q for the
period ended March 31, 2022, which was due to be filed with the
Securities and Exchange Commission no later than May 23, 2022.
For the reasons previously disclosed in its Form 12b-25 filed with
the SEC on May 17, 2022, the Company has not timely filed the
Delayed Form 10-Q because additional time is needed to finalize the
Delayed Form 10-Q and furnish the XBRL Interactive Data File
exhibits required by Item 601(b)(101) of Regulation S-K. The
Company is actively working to complete the Delayed Form 10-Q and
intends to file the Delayed Form 10-Q under the Securities Exchange
Act of 1934, as amended, within the next 30 days.
As a result of the foregoing, the Company has become subject to the
procedures and requirements of Section 1007 of the Company Guide.
During the six-month period from the date of the Filing
Delinquency, the Exchange will monitor the Company and the status
of the Delayed Form 10-Q and any subsequent reports until the
Filing Delinquency is cured. If the Company fails to cure the
Filing Delinquency within the Initial Cure Period, the Exchange
may, in its sole discretion, allow the Company's securities to be
traded for up to an additional six-month period, depending on the
Company's specific circumstances. If the Exchange determines that
an Additional Cure Period is not appropriate, suspension and
delisting procedures will commence in accordance with the
procedures set forth in Section 1010 of the Company Guide.
Notwithstanding the foregoing, however, the Exchange may in its
sole discretion decide (i) not to afford the Company any Initial
Cure Period or Additional Cure Period, as the case may be, at all
or (ii) at any time during the Initial Cure Period or Additional
Cure Period, to truncate the Initial Cure Period or Additional Cure
Period, as the case may be. Furthermore, the Exchange may
immediately commence suspension and delisting procedures if the
Company is subject to delisting pursuant to any other provision of
the Company Guide, including if the Exchange believes, in its sole
discretion, that continued listing and trading of the Company's
securities on the Exchange is inadvisable or unwarranted in
accordance with Sections 1001-1006 of the Company Guide.
In the interim, the Company's securities will continue to be listed
on the Exchange, subject to the Company's compliance with other
continued listing requirements, and the Company's common stock and
preferred stock will continue to trade under the symbols "RHE" and
"RHE PRA," respectively. The Exchange will make a late filer
(".LF") indicator available on the consolidated tape. Each data
vendor that disseminates the quotes and trades of Exchange-listed
issuers may append this indicator to the ticker symbols of the
Company. Each vendor is free to use an indicator of its own
choosing so the letter or symbol used to indicate this status may
differ from vendor to vendor. The Exchange also publishes a list
of noncompliant issuers and displays the .LF indicator on its
website.
About Regional Health Properties
Regional Health Properties, Inc. (NYSE American: RHE) (NYSE
American: RHEpA) -- http://www.regionalhealthproperties.com-- is
a
self-managed healthcare real estate investment company that invests
primarily in real estate purposed for senior living and long-term
healthcare through facility lease and sub-lease transactions.
Regional Health a net loss of $1.18 million for the year ended Dec.
31, 2021, and a net loss of $688,000 for the year ended Dec. 31,
2020. As of Dec. 31, 2021, the Company had $105.70 million in
total assets, $95.30 million in total liabilities, and $10.40
million in total stockholders' equity.
REGIONAL HEALTH: Reports $2.9 Million Net Loss for First Quarter
----------------------------------------------------------------
Regional Health Properties, Inc. filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q disclosing a
net loss of $2.93 million on $6.65 million of total revenues for
the three months ended March 31, 2022, compared to a net income of
$21,000 on $7.08 million of total revenues for the three months
ended March 31, 2021.
As of March 31, 2022, the Company had $102.56 million in total
assets, $95.02 million in total liabilities, and $7.53 million in
total stockholders' equity.
The Company intends to pursue measures to grow its operations,
streamline its cost infrastructure and otherwise increase
liquidity, including: (i) refinancing or repaying debt to reduce
interest costs and mandatory principal repayments, with such
repayment to be funded through potentially expanding borrowing
arrangements with certain lenders; (ii) increasing future lease
revenue through acquisitions and investments in existing
properties; (iii) modifying the terms of existing leases; (iv)
replacing certain tenants who default on their lease payment terms;
and (v) reducing other and general and administrative expenses.
Management anticipates access to several sources of liquidity,
including cash on hand, cash flows from operations, and debt
refinancing during the twelve months following May 31, 2022 (the
date of this filing). At March 31, 2022, the Company had $4.5
million in unrestricted cash, including a Medicaid overpayment of
$1.5 million received on Sept. 30, 2021, which the Company expects
to repay in the near future.
During the three months ended March 31, 2022, the Company's cash
flow from operations was negative $1.6 million primarily due to
unpaid rent payments. Management anticipates collecting a portion
of the past due rent after the filing date and is currently
negotiating various methods to collect the remaining unpaid rent.
Cash flow from operations in the future, will be subject operating
performance of the new management agreements with Peach Health as
well as continued uncertainty of the COVID-19 pandemic and its
impact on the Company's business, financial condition and results
of operations.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/0001004724/000156459022021737/rhe-10q_20220331.htm
About Regional Health Properties
Regional Health Properties, Inc. (NYSE American: RHE) (NYSE
American: RHEpA) -- http://www.regionalhealthproperties.com-- is a
self-managed healthcare real estate investment company that invests
primarily in real estate purposed for senior living and long-term
healthcare through facility lease and sub-lease transactions.
Regional Health a net loss of $1.18 million for the year ended Dec.
31, 2021, and a net loss of $688,000 for the year ended Dec. 31,
2020. As of Dec. 31, 2021, the Company had $105.70 million in
total assets, $95.30 million in total liabilities, and $10.40
million in total stockholders' equity.
RELMADA THERAPEUTICS: All Four Proposals Passed at Annual Meeting
-----------------------------------------------------------------
Relmada Therapeutics, Inc. held its 2022 Annual Meeting of
Stockholders at which the stockholders:
(1) elected Eric Schmidt as director to hold office until the
2025 Annual Meeting and until his successor is elected and
qualified;
(2) approved the ratification of the appointment of Marcum LLP
as the Company's independent registered public accounting firm for
the fiscal year ending Dec. 31, 2022;
(3) approved the amendment to the Company's 2021 Equity
Incentive Plan; and
(4) approved an amendment to the Company's Articles of
Incorporation to increase the number of authorized shares of the
Company's common stock from 50,000,000 shares to 150,000,000
Shares.
The continuing Class II Directors are Charles J. Casamento and
Sergio Traversa. The continuing Class III Directors are John
Glasspool and Paul Kelly.
About Relmada Therapeutics Inc.
Relmada Therapeutics is a late-stage pharmaceutical company
addressing diseases of the central nervous system (CNS), with a
focus on major depressive disorder (MDD).
For the nine months ended Sept. 30, 2021, the Company reported a
net loss of $91.37 million. Relmada Therapeutics reported a net
loss of $59.45 million for the year ended Dec. 31, 2020, compared
to a net loss of $15 million for the year ended Dec. 31, 2019. As
of Sept. 30, 2021, the Company had $90.93 million in total assets,
$18.25 million in total current liabilities, and $72.69 million in
total stockholders' equity.
REVLON INC: Starts Talks With Lenders Prior to Debt Deadlines
-------------------------------------------------------------
Soma Biswas of The Wall Street Journal reports that cosmetics
manufacturer Revlon Inc. is in talks with lenders ahead of its debt
deadlines.
According to people familiar with the matter, cosmetics maker
Revlon Inc. has begun talks with lenders ahead of looming
maturities of debt to try to steer the business clear of
bankruptcy.
A group of lenders including Angelo Gordon, Glendon Capital
Management LP and King Street Capital Management are in
restructuring discussions with Revlon about pushing out the due
date on roughly $1.7 billion in debt that matures as early as 2024,
people familiar with the matter said. The lenders have hired
Centerview Partners for debt negotiations.
About Revlon
Revlon, Inc. conducts its business exclusively through its direct
wholly-owned operating subsidiary, Revlon Consumer Products
Corporation, and its subsidiaries. Revlon is an indirect
majority-owned subsidiary of MacAndrews & Forbes Incorporated, a
corporation beneficially owned by Ronald O. Perelman. The Company
operates in four brand-centric reporting segments that are aligned
with its organizational structure based on four global brand teams:
Revlon; Elizabeth Arden; Portfolio; and Fragrances. The Company
manufactures, markets and sells an extensive array of beauty and
personal care products worldwide, including color cosmetics;
fragrances; skin care; hair color, hair care and hair treatments;
beauty tools; men's grooming products; anti-perspirant deodorants;
and other beauty care products.
Revlon reported a net loss of $206.9 million for the year ended
Dec. 31, 2021, a net loss of $619 million for the year ended Dec.
31, 2020, and a net loss of $157.7 million for the year ended Dec.
31, 2019. As of Dec. 31, 2021, Revlon had $2.43 billion in total
assets, $787.6 million in total current liabilities, $3.30 billion
in long-term debt, $147.3 million in long-term pension and other
post-retirement plan liabilities, $206.2 million in other long-term
liabilities, and a total stockholders' deficiency of $2.01
billion.
ROCKALL ENERGY: Committee Taps Mani Little as Special Counsel
-------------------------------------------------------------
The official committee of unsecured creditors appointed in the
Chapter 11 cases of Rockall Energy Holdings, LLC and its affiliates
seeks approval from the U.S. Bankruptcy Court for the Northern
District of Texas to employ Mani Little & Wortmann, PLLC as its
special oil and gas lien counsel.
The firm will render these services:
(a) review the Debtors' oil and gas leases and wells and
associated security instruments in North Dakota, Louisiana, and
Mississippi; and
(b) perform other necessary legal services in relation to the
Chapter 11 cases.
The rates charged by the firm for its services are as follows:
Partners $550 - $575/hour
Associates $300 - $425/hour
Landmen $500 - $575/day
In addition, the firm will charge the committee for work-related
expenses incurred.
Eric Wortmann II, Esq., a partner at Mani Little, disclosed in
court filings that the firm is a "disinterested person" as that
term is defined in Section 101(14) of the Bankruptcy Code.
Mr. Wortmann also made the following disclosures in response to the
request for additional information set forth in Paragraph D.1 of
the Revised U.S. Trustee Guidelines:
-- Mani Little has not agreed to any variations from, or
alternatives to, its standard or customary billing arrangements for
this engagement;
-- none of the professionals included in the engagement vary
their rate based on the geographic location of the bankruptcy
case;
-- the firm has not represented the committee in the 12 months
prepetition; and
-- the committee and Mani Little & Wortmann expect to work
together to develop a budget and staffing plan for the Chapter 11
cases.
The firm can be reached through:
Eric W. Wortmann II, Esq.
Mani Little & Wortmann, PLLC
5801 Edwards Ranch Road, Suite 100
Fort Worth, TX 76109
Telephone: (817) 382-0900
Facsimile: (817) 668-1368
Email: ewortmann@mlwenergylaw.com
About Rockall Energy Holdings
Rockall Energy Holdings, LLC is a mid-sized oil exploration and
production company.
Rockall Energy and its affiliates sought Chapter 11 bankruptcy
protection (Bank. N.D. Tex. Lead Case No. 22-90000) on March 9,
2022. In the petition filed by David Mirkin, as chief financial
officer, Rockall Energy Holdings listed $100 million and $500
million in both assets and liabilities.
The cases are handled by Honorable Judge Mark X. Mullin.
The Debtors tapped Vinson & Elkins, LLP as legal counsel; Lazard
Freres & Co., LLC as investment banker; and Ankura Consulting
Group, LLC, as restructuring advisor. Stretto, Inc. is the claims
agent.
On March 18, 2022, the Office of the U.S. Trustee appointed an
official committee of unsecured creditors. The committee tapped
Pachulski Stang Ziehl & Jones LLP as its counsel and Riveron RTS,
LLC as financial advisor.
RUBY PIPELINE: Committee Taps Benesch as Delaware Counsel
---------------------------------------------------------
The official committee of unsecured creditors of Ruby Pipeline, LLC
received approval from the U.S. Bankruptcy Court for District of
Delaware to hire Benesch, Friedlander, Coplan & Aronoff LLP, as its
Delaware counsel.
The firm's services include:
a. in conjunction with Brown Rudnick, providing legal advice
where necessary with respect to the committee’s powers and duties
and strategic advice on how to accomplish the committee’s goals,
bearing in mind that the court relies on Delaware counsel such as
Benesch to be involved in all aspects of the bankruptcy
proceeding;
b. drafting, reviewing, and commenting on drafts of documents
to ensure compliance with the Local Rules, practices, and
procedures of the Court;
c. assisting and advising the committee in its consultation
with Brown Rudnick and the U.S. Trustee relative to the
administration of this Chapter 11 case;
d. drafting, filing, and serving documents as requested by
Brown Rudnick and the committee;
e. assisting the committee and Brown Rudnick, as necessary, in
the investigation (including through discovery) of the acts,
conduct, assets, liabilities and financial condition of the Debtor,
the operation of the Debtor's business, and any other matter
relevant to this Chapter 11 Case or to the formulation of a plan or
plans of reorganization or liquidation;
f. compiling and coordinating delivery to the Court and the
U.S. Trustee information required by the Bankruptcy Code,
Bankruptcy Rules, Local Rules, and any applicable U.S. Trustee
guidelines and/or requests;
g. appearing in Court and at any meetings of creditors on
behalf of the committee in its capacity as Delaware counsel with
Brown Rudnick;
h. monitoring the case dockets and coordinating with Brown
Rudnick and any other professional retained by the committee on
matters impacting the committee;
i. participating in calls and meetings with the committee;
j. preparing, updating, and distributing critical dates
memoranda and working group lists;
k. handling inquiries and calls from creditors and counsel to
interested parties regarding pending matters and the general status
of this Chapter 11 Case and coordinating with Brown Rudnick on any
necessary responses; and
l. providing additional support to Brown Rudnick, other
committee professionals, and the committee, as requested.
The hourly rates charged by the firm for its services are as
follows:
Jennifer R. Hoover Partner $725 per hour
Kevin M. Capuzzi Partner $570 per hour
John C. Gentile Associate $455 per hour
Juan Martinez Associate $310 per hour
LouAnne Molinaro Paralegal $350 per hour
Partners $395 to $895 per hour
Associates $245 to $575 per hour
Paraprofessionals $110 to $350 per hour
As disclosed in court filings, Benesch 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, Benesch
disclosed that:
-- it has not agreed to any variations from, or alternatives
to, its standard or customary billing arrangements for this
engagement;
-- none of the professionals included in the engagement vary
their rate based on the geographic location of the bankruptcy
case;
-- the firm has not represented the committee in the 12 months
prepetition; and
-- Benesch is developing a budget and staffing plan that will
be presented to the committee in conjunction with Brown Rudnick.
The firm can be reached through:
Jennifer R. Hoover, Esq.
Benesch, Friedlander, Coplan & Aronoff LLP
1313 North Market Street, Suite 1201
Wilmington, DE 19801
Tel: 302-442-7010
Email: jhoover@beneschlaw.com
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.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors on April 19, 2022. Brown Rudnick, LLP and
Benesch, Friedlander, Coplan & Aronoff LLP serve as the committee's
bankruptcy counsel and Delaware counsel, respectively.
RUBY PIPELINE: Committee Taps Brown Rudnick as Legal Counsel
------------------------------------------------------------
The official committee of unsecured creditors of Ruby Pipeline, LLC
received approval from the U.S. Bankruptcy Court for District of
Delaware to hire Brown Rudnick LLP as its legal counsel.
The firm's services include:
a. assisting and advising the committee in its discussions
with the Debtor and other parties-in-interest regarding the overall
administration of this case;
b. representing the committee at hearings to be held before
this court and communicating with the committee regarding the
matters heard and the issues raised as well as the decisions and
considerations of this Court;
c. assisting and advising the committee in its examination and
analysis of the conduct of the Debtor's affairs;
d. reviewing and analyzing pleadings, orders, schedules, and
other documents filed and to be filed with this Court by interested
parties in this Chapter 11 case; advising the committee as to the
necessity, propriety, and impact of the foregoing upon this Chapter
11 case; and consenting or objecting to pleadings or orders on
behalf of the committee, as appropriate;
e. assisting the committee in preparing such applications,
motions, memoranda, proposed orders, and other pleadings as may be
required in support of positions taken by the committee, including
all trial preparation as may be necessary;
f. assisting, advising and representing the committee with
respect to the Debtor's retention of professionals and advisors
with respect to the Debtor's business and this Chapter 11 case;
g. conferring with the professionals retained by the Debtor
and other parties-in-interest, as well as with such other
professionals as may be selected and employed by the committee;
h. coordinating the receipt and dissemination of information
prepared by and received from the Debtor's professionals, as well
as such information as may be received from professionals engaged
by the committee or other parties-in-interest in this Chapter 11
case;
i. assisting, advising and representing the committee in the
evaluation of claims and on any litigation matters, including
avoidance actions;
j. participating in such examinations of the Debtor and other
witnesses as may be necessary in order to analyze and determine,
among other things, the Debtor's assets and financial condition,
whether the Debtor has made any avoidable transfers of property, or
whether causes of action exist on behalf of the Debtor's estate;
k. assisting and advising the committee in connection with any
sale of any or substantially all of the Debtor's assets;
l. assisting and advising the committee in connection with
analyzing estate assets, including, without limitation, any estate
causes of action against any parties;
m. negotiating and, if necessary or advisable, formulating a
plan of reorganization or liquidation for the Debtor; and
n. assisting the committee generally in performing such other
services as may be desirable or required for the discharge of the
committee's duties pursuant to section 1103 of the Bankruptcy Code.
The hourly rates charged by the firm for its services are as
follows:
Attorney $565 to $1,875 per hour
Paraprofessional $415 to $490 per hour
In accordance with Appendix B-Guidelines for reviewing fee
applications filed by attorneys in larger Chapter 11 cases, Brown
Rudnick disclosed that:
-- it has not agreed to any variations from, or alternatives
to, its standard or customary billing arrangements for this
engagement;
-- none of the professionals included in the engagement vary
their rate based on the geographic location of the bankruptcy
case;
-- the firm has not represented the committee in the 12 months
prepetition; and
-- Brown Rudnick is preparing a budget and staffing plan and
anticipates presenting it to the committee for approval.
As disclosed in court filings, Brown Rudnick neither holds nor
represents an interest adverse to the Debtor's estate with respect
to the matters for which the firm is to be employed.
The firm can be reached through:
Robert J. Stark, Esq.
Brown Rudnick LLP
7 Times Square
New York, NY 10036
Phone: 212-209-4800
Fax: 212-209-4801
Email: rstark@brownrudnick.com
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.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors on April 19, 2022. Brown Rudnick, LLP and
Benesch, Friedlander, Coplan & Aronoff LLP serve as the committee's
bankruptcy counsel and Delaware counsel, respectively.
SABRE HOLDINGS: Moody's Affirms Ba3 CFR & Alters Outlook to Stable
------------------------------------------------------------------
Moody's Investors Service affirmed Sabre Holdings Corporation's Ba3
Corporate Family Rating, Ba3-PD Probability of Default Rating, and
instrument ratings for senior secured credit facilities and notes
at Sabre's wholly-owned subsidiary, Sabre GLBL Inc. The outlook was
changed to stable from negative reflecting Moody's expectation for
continued recovery in the number of passengers boarded globally
combined with Sabre's commitment to reduce debt balances with
excess cash and restore credit metrics to pre-pandemic levels. In
addition, the Speculative Grade Liquidity (SGL) Rating was changed
to SGL-2 from SGL-3 supported by over $1 billion of cash balances
and resolution of longstanding litigation with limited financial
impact.
RATINGS RATIONALE
Continued growth in travel demand and air passenger volumes will
support ongoing recovery in Sabre's revenues and profitability, and
Moody's expects Sabre will reach breakeven cash flow or better in
4Q22. The company is committed to repaying debt balances with
excess cash and returning credit metrics to pre-pandemic levels,
including adjusted debt to EBITDA below 4.5x and adjusted EBITDA
margins in the mid 20% range. Since March 2020, Sabre has suspended
quarterly dividend payments and share buybacks to manage liquidity.
The February 2022 sale of AirCentre for $392.5 million boosted cash
balances to $1.2 billion.
Rating actions are summarized below:
Affirmations:
Issuer: Sabre Holdings Corporation
Corporate Family Rating, Affirmed Ba3
Probability of Default Rating, Affirmed Ba3-PD
Issuer: Sabre GLBL Inc.
Senior Secured Bank Credit Facility, Affirmed Ba3 to (LGD4) from
(LGD3)
Gtd Senior Secured Regular Bond/Debenture, Affirmed Ba3 to (LGD4)
from (LGD3)
Upgrades:
Issuer: Sabre Holdings Corporation
Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3
Outlook Actions:
Issuer: Sabre Holdings Corporation
Outlook, Changed To Stable From Negative
Issuer: Sabre GLBL Inc.
Outlook, Changed To Stable From Negative
Sabre's Ba3 CFR is supported by the company's asset-lite business
model and good operating scale as the #2 provider of Global
Distribution System (GDS) services globally with a preponderance of
transaction-based revenue. Sabre's multi-year investment to migrate
to a cloud-based IT platform from its legacy mainframe remains on
track to be largely completed by the end of 2023 and will enhance
profit margins and reduce capital spending requirements. Sabre's
revenues continue to grow supported by the ongoing recovery in
travel demand following the near shutdown in global air travel in
2Q20 as a result of the pandemic. Revenues totaled $585 million in
1Q22 (or 58% of 1Q19's pre-pandemic revenues pro forma for sale of
AirCentre) compared to revenues of $327 million in 1Q21 (or 32% of
1Q19 revenues) driven primarily by an increase in global air,
hotel, and other travel bookings. More recently, the recovery in
bookings compared to 2019 levels continued to improve following
1Q22 making April 2022 the best month since the onset of the
pandemic with a 64% distribution gross bookings recovery pro forma
for the earlier termination of the Expedia agreement. In March
2022, Moody's reported that the outlook for the Global Airlines
sector remained positive given strong air travel demand and despite
the sharp rise in oil prices and the invasion of Ukraine by
Russia.
Although leisure travel has been leading the recovery, higher
margin corporate and international bookings are picking up as
international borders reopen and travel restrictions are relaxed or
eliminated. As a result, Sabre's overall revenue mix is approaching
pre-pandemic levels and average booking fees have increased.
Moody's expects Sabre will be free cash flow breakeven or better in
4Q22 and adjusted EBITDA margins will approach the mid-20% range in
2024 given migration to a cloud platform from its legacy mainframe
as well as focus on higher margin businesses. Although Sabre's top
line will remain below 2019 levels through 2023, significant cost
reductions and close management of growth investments and IT spend
has helped to preserve liquidity. Sabre reduced its monthly cash
burn rate to an average ($10 million) in 4Q21 from the ($60
million) range at the beginning of 2021.
In May 2022, a federal jury ruled in favor of American Airlines
Group Inc. in its lawsuit dating back to 2011 and accusing Sabre of
charging excessive fees and suppressing competition. Although Sabre
did not win the ruling, Sabre was required to pay only $1 in
damages to American Airlines Group Inc. which eliminated the
potential for significant monetary claims and removed an overhang
on Sabre's credit profile.
Sabre is committed to disciplined financial policies as evidenced
by the sale of AirCentre as well as prior debt and equity raises.
Moody's expects Sabre will reduce debt balances as travel demand
further rebounds and adjusted EBITDA will exceed $900 million.
Prior to the increase in leverage arising from cloud migration and
growth investments in 2019, Sabre had demonstrated a track record
for maintaining adjusted debt to EBITDA at 4x or better since 2015
with adjusted free cash flow to debt in the mid-single digit
percentage range. To preserve liquidity during the pandemic, Sabre
has been prudent and suspended distributions since the beginning of
2020. The company also raised just under $600 million of cash
proceeds from the issuances of mandatory convertible preferred
stock and common stock in August 2020 to enhance liquidity. Sabre
is publicly traded with its four largest shareholders, Vanguard,
Blackrock, Fundsmith, and Invesco, each owning roughly 5.5% - 9.5%
of common shares followed by other investment management companies
holding 5% or less. Good governance is supported by a board of
directors with 9 of the company's 10 board seats being held by
independent directors.
The SGL-2 rating reflects Moody's expectation that Sabre will
maintain good liquidity over the next year given $1.2 billion of
unrestricted cash balances as of March 2022 which is more than
enough to cover reduced monthly cash burn over the next few months
before turning positive and an $80 million investment in American
Express Global Business Travel (expected in 2Q22). Sabre will have
the ability to apply a portion of excess cash to debt repayment in
the first half of 2023 given ample cash balances. Moody's assumes
the remaining $1.2 billion term loan B due February 2024 (reduced
from the original $1.8 billion) will be repaid or refinanced well
before maturity. The company has historically maintained a large
share of cash at its overseas subsidiaries to support its large
geographic operating footprint, with roughly $150 million needed
globally. Sabre suspended common dividends which eliminated a $154
million annual cash outflow with another $70 million preserved by
suspending share buybacks, and Moody's expects distributions will
remain suspended over the next year.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that the number of
passengers boarded will continue to recover enabling Sabre to reach
breakeven free cash flow or better in 4Q22 followed by debt
repayment in 2023 to be funded with a combination of excess cash
flow and cash on hand. Given the migration to a cloud-based IT
platform will be largely completed by the end of 2023 and a
reduction in lower margin businesses, Sabre will benefit from
higher profit margins and adjusted EBITDA will approach
pre-pandemic levels in 2024. Although improving, Moody's expects
higher margin international and business travel passenger volumes
will lag in the overall recovery.
Ratings could be upgraded if Sabre returns to good earnings growth
with more diversified operating profits. Debt to EBITDA would need
to be sustained below 4x (Moody's adjusted) with adjusted free cash
flow to debt in the high single digit percentage range. Sabre's
ratings could be downgraded if customer losses, pricing erosion, or
competitive pressures lead to adjusted debt to EBITDA exceeding
4.75x or adjusted free cash flow to debt deteriorating to the low
single digit percentage range on a sustained basis. Downward rating
pressure could also arise if Moody's expects that liquidity will be
strained or if Sabre funds distributions or sizable acquisitions
prior to adjusted debt to EBITDA improving to the low-to-mid 4x
range with assurances of a long term rebound in travel demand. Not
repaying or refinancing term loans due 2024 comfortably ahead of
their maturity could also pressure ratings.
Based in Southlake, TX, Sabre Holdings Corporation's business is
organized in two segments: the Travel Solutions segment includes
revenues from GDS services (a software-based passenger reservation
system) as well as from commercial and operations offerings to the
airline industry; and the Hospitality Solutions segment includes
distribution, operations, and marketing offerings for the hotel
industry.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
SAVVA'S RESTAURANT: Taps Maltz Auctions as Real Estate Broker
-------------------------------------------------------------
Savva's Restaurant, Inc. received approval from the U.S. Bankruptcy
Court for the Eastern District of New York to employ Maltz
Auctions, Inc. as its real estate broker.
The Debtor requires a real estate broker to sell its real
properties located at the Town of North Hempstead.
Maltz Auctions will receive a commission of 5 percent of the gross
sale price.
As disclosed in court filings, Maltz Auctions is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Richard B. Maltz
Maltz Auctions, Inc.
39 Windsor Place
Central Islip, NY 11722
Tel: 516-349-7022
Fax: 516-349-0105
About Savva's Restaurant
Savva's Restaurant, Inc., doing business as Harvest Diner, filed a
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code (Bankr. E.D.N.Y. Case No. 22-70382) on March 4, 2022,
disclosing $5,625,000 in total assets and $2,485,720 in total
liabilities. Kyriacos Savva, president, signed the petition.
Judge Robert E. Grossman oversees the case.
The Debtor tapped Pryor & Mandelup, LLP as bankruptcy counsel;
Lambrou Law Firm, P.C. as special counsel; and Prager Metis CPAs,
LLC as accountant.
TD HOLDINGS: Inks Deal to Sell $11.4 Million Worth of Common Shares
-------------------------------------------------------------------
TD Holdings, Inc. entered into that certain Securities Purchase
Agreement with Mr. Xiangjun Wang and Mr. Heung Ming (Henry) Wong,
affiliates of the Company, and certain other non-affiliate
purchasers who are "non-U.S. Persons" as defined in Regulation S of
the Securities Act of 1933, as amended, pursuant to which the
Company agreed to sell an aggregate of 57,100,000 shares of its
common stock, par value $0.001 per share, at a per share purchase
price of $0.20. The gross proceeds to the Company from the Common
Stock PIPE will be $11.42 million. Since Mr. Wang and Mr. Wong are
affiliates of the Company, the Common Stock PIPE has been approved
by the Audit Committee of the Board of Directors of the Company as
well as the Board of Directors of the Company.
The parties to the SPA have each made customary representations,
warranties and covenants, including, among other things, (a) the
Investors are "non-U.S. Persons" as defined in Regulation S and are
acquiring the Shares for the purpose of investment, (b) the absence
of any undisclosed material adverse effects, and (c) the absence of
legal proceedings that affect the completion of the transaction
contemplated by the SPA.
The SPA is subject to various conditions to closing including
Nasdaq's completion of its review of the notification to Nasdaq
regarding the listing of the Shares. The Shares to be issued in
the Common Stock PIPE are exempt from the registration requirements
of the Securities Act of 1933, as amended, pursuant to Regulation S
promulgated thereunder.
The net proceeds of the Common Stock PIPE will be used by the
Company in connection with the Company's general corporate
purposes, working capital, or other related business as approved by
the board of directors of the Company.
About TD Holdings
TD Holdings, Inc. is a service provider currently engaging in
commodity trading business and supply chain service business in
China. Its commodities trading business primarily involves
purchasing non-ferrous metal product from upstream metal and
mineral suppliers and then selling to downstream customers. Its
supply chain service business primarily has served as a one-stop
commodity supply chain service and digital intelligence supply
chain platform integrating upstream and downstream enterprises,
warehouses, logistics, information, and futures trading. For more
information, please visit http://ir.tdglg.com.
TD Holdings reported a net loss of $940,357 for the year ended Dec.
31, 2021, a net loss of $5.95 million for the year ended Dec. 31,
2020, and a net loss of $6.94 million for the year ended Dec. 31,
2019. As of March 31, 2022, the Company had $279.13 million in
total assets, $33.48 million in total liabilities, and $245.65
million in total equity.
THERMA BUILDERS: July 27 Plan Confirmation Hearing Set
------------------------------------------------------
Therma Builders, Inc., d/b/a Tom Craig Remodeling & Building, filed
with the U.S. Bankruptcy Court for the Middle District of Florida a
Chapter 11 Small Business Subchapter V Plan. On June 2, 2022,
Judge Michael G. Williamson ordered that:
* July 27, 2022, at 01:30 PM in Courtroom 8A, Sam M. Gibbons
United States Courthouse, 801 N. Florida Ave., Tampa, FL 33602 is
the hearing on confirmation of the Plan.
* Objections to confirmation of the Plan shall be filed no
later than seven days before the Confirmation Hearing.
* An election under 11 U.S.C. Sec. 1111(b) must be filed no
later than seven days before the Confirmation Hearing.
* Debtor shall file a ballot tabulation no later than two days
before the Confirmation Hearing.
A full-text copy of the Order dated June 2, 2022, is available at
https://bit.ly/3NZEHuH from PacerMonitor.com at no charge.
Attorney for Debtor:
BUDDY D. FORD, P.A.,
Buddy D. Ford, Esquire
Email: Buddy@tampaesq.com
Jonathan A. Semach, Esquire
Email: Jonathan@tampaesq.com
Heather M. Reel, Esquire
Email: Heather@tampaesq.com
9301 West Hillsborough Avenue
Tampa, Florida 33615-3008
Telephone #: (813) 877-4669
Office Email: All@tampaesq.com
About Therma Builders
Therma Builders Inc. was incorporated on April 19, 1979. It was
engaged in the ownership and operation of a construction and
remodeling contractor service known as Therma Builders, Inc. d/b/a
Tom Craig Remodeling & Building.
Therma Builders filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No.
22-00701) on Feb. 23, 2022.
The Debtor is represented by Buddy D. Ford, Esq. of BUDDY D. FORD,
P.A.
THOMASBORO LANDCO: Court Approves Amended Disclosure Statement
--------------------------------------------------------------
Judge Henry A. Fallaway has entered an order approving the First
Amended Disclosure Statement of Thomasboro Landco, LLC.
The hearing on confirmation of the Plan is scheduled for July 12,
2022, at 8:30 a.m. CST, Courtroom 2 West, 113 St. Joseph Street,
Mobile, AL 36602.
Any objections to confirmation of the Plan must be filed with the
Court by July 5, 2022.
All creditors and other parties in interest entitled to vote on the
Plan must transmit written notice of their acceptance or rejection
of the Plan to counsel for the Debtor by July 5, 2022.
The Debtor must file a summary of voting on the Plan (by creditor
and by class) with the Court by July 8, 2022.
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.
TPC GROUP: Bankruptcy Filing Reveals Need for More Safeguards
-------------------------------------------------------------
Thomas Taschinger, writing for Beaumont Enterprise, says that TPC
Group's bankruptcy filing has revealed the need for more
safeguards.
It wasn't quite the same shock that thousands of Mid County
residents received the day before Thanksgiving in 2019, but it was
just as unwelcome. The TPC Group has declared bankruptcy, and 5,000
unresolved damage claims could be settled for far less money than
justified -- or none at all. Once again, shortcomings in state law
have left consumers vulnerable for something where they need the
greatest protection.
For starters, big plants like this should be required to carry much
larger insurance. The TPC Group had about $100 million in
insurance, according to attorney Brent Coon, which seems like a lot
of money. But with an industrial accident like this, it might not
be enough.
This is the exact same problem that happened with the fertilizer
plant in West, Texas, that exploded in 2013, killing 15 and
injuring nearly 200. It too had little insurance, leaving many
victims uncompensated for their tragic losses.
This is something the Legislature should address in the regular
session that begins in January, a requirement for a high minimum
level of insurance. Many large plants have that amount of insurance
already, and the costs won't be that much greater for those which
don't. But in a situation like this, that coverage could at least
ensure that accident victims will be adequately compensated for
their losses.
It's not clear now how much money the TPC claimants will receive
for their losses – and again, they might not get anything. Orange
County Judge Courtney Arkeen's court has been assigned many of
these claims, and she should use whatever authority she has to
direct TPC assets to these victims. Many of their homes suffered
structural damage that could be a concern for years to come.
And while the petrochemical plants in Southeast Texas shouldn't
need any further incentive to operate safely, this disaster shows
even more forcefully why that must be their top priority.
The plant was destroyed, dozens of jobs may be lost and thousands
of nearby residents suffered property damage. An estimated 50,000
people were forced to evacuate the day before one of our most
important holidays – Thanksgiving – when they might have had
loved ones coming to see them or plans to visit them. All of that
was disrupted by a terrifying event that disrupted lives for days
or weeks. The only thing that would have made it worse would have
been fatalities, but fortunately that was avoided in this
explosion.
But people in Southeast Texas or some other part of the state might
not be that fortunate the next time. That's why the plants, state
and federal regulators and public officials must do everything they
can to ensure that there is no "next time." The failures of TPC
must not be repeated in Southeast Texas, or any part of this
state.
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: Moody's Lowers CFR to 'C' Following Bankruptcy Filing
----------------------------------------------------------------
Moody's Investors Service downgraded TPC Group Inc.'s ratings
following the announcement that it voluntarily filed for
reorganization under Chapter 11 of the United States Bankruptcy
Code on June 1, 2022. Moody's downgraded the Corporate Family
Rating to C from Caa3, the Probability of Default Rating to D-PD
from Caa3-PD and first lien senior secured notes to C from Caa3.
Moody's affirmed TPC's first lien priming senior secured notes at
B3. The outlook is changed to stable from negative.
Subsequent to the actions, Moody's will withdraw all ratings.
RATINGS RATIONALE
The downgrade of TPC's ratings follows the announcement that it had
filed for bankruptcy and entered into a Restructuring Support
Agreement ("RSA") with an ad hoc group of noteholders representing
approximately 80% of its outstanding secured notes, among others.
The RSA should provide the liquidity necessary for the company and
its management to continue operations and complete the
restructuring including a $323 million delayed draw
debtor-in-possession financing facility (not rated), which includes
$85 million of new money, and a $200 million asset-based revolving
debtor-in-possession facility.
Management expects that the bankruptcy process will resolve all
tort liabilities arising from the Port Neches facility incident and
eliminate over $950 million of secured debt from its balance sheet.
Management expects that its emergence from bankruptcy will be
facilitated by capital infusions in the form of $300 million of new
equity, $150 million of holdco PIK notes and $350 million in
secured notes.
The principal methodology used in these ratings was Chemical
Industry published in March 2019.
TPC Group Inc., headquartered in Houston, Texas, is a processor of
crude C4 hydrocarbons (primarily butadiene, butene-1, isobutene)
and differentiated isobutene derivatives. The company operates
through two business segments: C4 Processing and Performance
Products (PP). Revenues can range from less than $1.0 to $1.6
billion depending on commodity prices and production volumes.
TRIPLET LLC: Unsecured Creditors Will Get 15% of Claims in 5 Years
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Triplet, LLC, filed with the U.S. Bankruptcy Court for the District
of Maryland a Disclosure Statement with respect to a Plan of
Reorganization dated June 2, 2022.
Triplet is a Maryland limited liability company, with its principal
place of business located at 10136 Southern Maryland Blvd.,
Dunkirk, Maryland 20754 (the "Restaurant Property"). Triplet
operates a Mama Lucia’s Italian Restaurant (the "Restaurant")
from the Restaurant Property.
Maria and Salvatore Lubrano, the principals of the Debtor, expanded
their restaurant operations and opened Mama Lucia restaurants in
Chesapeake Beach and Prince Frederick, Maryland. The Prince
Frederick restaurant closed in 2019. Financing of the construction
and acquisition of the Chesapeake Beach restaurant (which closed on
2021) is in large part the impetus of the financial problems that
impacted each of the restaurants, including Triplet's operations,
ultimately leading to the filing of this Chapter 11 Case.
Class 1 consists of the Allowed Secured Personal Property Tax Claim
of Calvert County, Maryland in the approximate amount of $3,943.00,
plus accrued interest at the legal rate. The Class 1 Allowed
Secured Personal Property Tax Claim shall be paid by the Debtor on
the Effective Date. Class 1 is Unimpaired under the Plan, and is
not entitled to vote to accept or reject the Plan.
Class 2 consists of the Allowed Secured Claim of FC Marketplace,
LLC. As of May 30, 2022, it is believed that FC Marketplace asserts
an outstanding balance in the amount of approximately $175,000.
The Class 2 Secured Claim of FC Marketplace shall be Allowed to the
extent of the value of its collateral ($50,000), as stated in this
Class 2, and, as to the balance of its Claim ($125,000), shall be
treated as a Class 3 Allowed General Unsecured Claim. FC
Marketplace shall retain its lien until the Class 2 Allowed Secured
Claim is paid in full. Class 2 is Impaired.
Class 3 consists of General Unsecured Claims filed against and/or
scheduled by the Debtor in the aggregate amount of approximately
$1,794,851.00. This Class 3 is comprised of the following Claims:
(i) the Unsecured Claim asserted by Community Bank of the
Chesapeake in the amount of approximately $1,337,396.00; (ii) the
Unsecured Claim of BB&T Equipment Finance in the amount of
approximately $200,000.00; (iii) the Under-Secured Claim of FC
Marketplace in the amount of approximately $125,000.00; (iv) the
Unsecured Claim of American Express National Bank in the amount of
approximately $28,749.00; (v) the Unsecured Claim of Capital One,
NA in the amount of approximately $18,980.00; (vi) the Unsecured
Claim of Jan Horton in the amount of $54,000.00; (vii) the
Unsecured Claim of Truist in the amount of $13,470.00; (viii) the
Unsecured Claim of VendLease in the amount of $12,766.00; (ix) the
Unsecured Claim of the Comptroller of Maryland in the amount of
$2,420.00; and (x) the Unsecured Claim of Curtis Property
Management in the amount of $1,800.00.
In full and final satisfaction and discharge of each Allowed Class
3 Claim, each Holder of an Allowed Class 3 Claim shall receive, on
a pro-rata basis, 15% of their Allowed Claims, in cash, in equal
quarterly installments, beginning on the Effective Date, and
continuing on the first day of each quarter thereafter during the 5
year term of this Plan. Payments to the Holders of Class 3 Allowed
General Unsecured Claims against the Debtor shall be in full and
final satisfaction of their Allowed Claims. Class 3 is Impaired
under the Plan, and is entitled to vote to accept or reject the
Plan.
Class 4 consists of Equity Interests in the Debtor. As of the
Petition Date, the membership interests in the Debtor were owned by
Maria Lubrano (50%) and Salvatore Lubrano (50%). Class 4 Equity
Interests in the Debtor shall be extinguished upon the Effective
Date, and New Interests shall be issued in the Reorganized Debtor.
Each Equity Interest Holder will purchase their equity interests in
the Reorganized Debtor by making a new value contribution to the
Plan in the amount of $7,500.00 (for a total of $15,000.00), to be
used to fund payments to Holders of Class 3 Allowed General
Unsecured Claims.
Payments under the Plan will be funded from revenues of the
Debtor's business operations and from a new value contribution from
the Debtor's current Equity Holders in the aggregate amount of
$15,000.00.
A full-text copy of the Disclosure Statement dated June 2, 2022, is
available at https://bit.ly/3Q0HPsd from PacerMonitor.com at no
charge.
Counsel to the Debtor:
McNamee Hosea, P.A.
Steven L. Goldberg (Fed. Bar No. 28089)
6411 Ivy Lane, Suite 200
Greenbelt, Maryland 20770
T: 301-441-2420
About Triplet LLC
Triplet, LLC, is a privately held company in the food service
industry. Triplet, LLC, doing business as Mamma Lucia Italian
Restaurant, sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. D. Md. Case No. 19-24475) on Oct. 29, 2019. The
petition was signed by Maria Lubrano, authorized representative. At
the time of the filing, the Debtor disclosed assets under $50,000
and liabilities under $10 million. Judge Wendelin I. Lipp is
assigned to the case. The Debtor is represented by Steven L.
Goldberg, Esq. at MCNAMEE, HOSEA, JERNIGAN, KIM, GREENAN & LYNCH,
P.A.
TWO'S COMPANY: Unsecureds to Get 12 Cents on Dollar in Plan
-----------------------------------------------------------
Two's Company Restaurant & Lounge, LLC submitted a First Amended
Plan of Reorganization.
This Plan of Reorganization under chapter 11 of the Bankruptcy Code
proposes to pay creditors of the Debtor from cash flow from
operations. If the confirmation is consensual, then the Debtor
shall make all of the payments. If the confirmation is
non-consensual, then for the term of the Plan, the Debtor shall
make a lump sum payment to the Subchapter V Trustee, and the
Subchapter V Trustee shall make the payments provided below and
receive compensation for the services as allowed by 11 U.S.C.
Section 1194(a)(3).
Filed unsecured claims, claims that filed as secured and have had
their liens avoided, and the undersecured portion of claims filed
as secured are in the amount of $205,755. Non-priority unsecured
creditors holding allowed claims will receive distributions, which
the proponent of this Plan has valued at approximately 12.12 cents
on the dollar, or an estimated total of $24,947. These payments
are subject to adjustment based on the allowance of claims,
including the allowance of administrative expenses like attorneys'
fees for the Debtor and Subchapter V Trustee, and whether the plan
is confirmed consensually or non-consensually.
Under the Plan, holders of Class 9 Non-priority Unsecured
Creditors, including the undersecured portion of any secured claim,
will be paid from the excess projected disposable income available
after monthly payment to all secured and priority claims and after
payment in full of all administrative claims. Class 9 is impaired.
Attorney for the Debtor:
George B. Goyke, Esq.
GOYKE & TILLISCH, LLP
2100 Stewart Avenue, Suite 140
Wausau, WI 54401
Tel: (715) 849-8100
E-mail: goyke@grandlawyers.com
A copy of the Plan dated June 1, 2022, is available at
https://bit.ly/3t8Is9p from PacerMonitor.com.
About Two's Company Restaurant
Two's Company Restaurant & Lounge, LLC, which operates a
restaurant, filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Wisc. Case No.
21-12177) on Oct. 22, 2021, listing up to $500,000 in assets and up
to $1 million in liabilities. Judge Catherine J. Furay oversees
the case. The Debtor is represented by Goyke & Tillisch, LLP.
UBER TECHNOLOGIES: S&P Alters Outlook to Positive, Affirms 'B' ICR
------------------------------------------------------------------
S&P Global Ratings revised its rating outlook to positive and
affirmed its 'B' issuer credit rating on San Francisco-based
mobility, delivery, and freight platform provider Uber Technologies
Inc.
S&P also affirmed its 'B+' senior secured issue-level ratings, and
'B-' unsecured issue-level ratings. The '2' senior secured recovery
ratings and '5' unsecured recovery ratings are unchanged.
S&P said, "The positive outlook reflects the possibility of an
upgrade if Uber can achieve our forecast for near $1 billion in
EBITDA and around break-even adjusted free operating cash flow in
2022, with potential further improvement in 2023.
"Uber's operating metrics have improved over the past three
quarters, and we expect further improvement in coming quarters.
Uber has reported three quarters of break-even or positive EBITDA
and one quarter of break-even cash flow. This compares to negative
EBITDA and free operating cash flow (FOCF) in the mid- to
high-hundreds of millions of dollars in prior quarters. Delivery
segment profitability has improved following the large boost in
bookings it enjoyed due to the pandemic; we also the think industry
profitability is improving as less venture capital is available for
customer acquisition (the same industry rationalization occurred in
the mobility segment several years ago around the time of Uber's
IPO).
"The positive outlook reflects the possibility of an upgrade if
Uber can achieve our forecast for near $1 billion in EBITDA and
around break-even adjusted FOCF in 2022."
S&P could raise Uber's rating if it can deliver near $1 billion of
EBITDA and adjusted FOCF around break-even. This would likely be
the result of:
-- A rebound in mobility bookings to pre-COVID levels and
continued double-digit delivery bookings growth; and
-- Improved leverage on operating expenses, particularly in
mobility, which has around break-even EBITDA, giving it room to
expand.
S&P could revise the outlook to stable if:
-- Cash flow remains negative because of intense competition,
adverse regulatory actions, or a resurgence in COVID-19 cases; or
-- The company undertook a multi-billion dollar debt-funded
acquisition.
VAL PROPERTIES: WesBanco Bank Says Disclosures Insufficient
-----------------------------------------------------------
WesBanco Bank, Inc., objects to the Disclosure Statement filed by
Debtor VAL Properties, LLC.
The case was filed as a single asset real estate case, that real
estate having an address of 54382 National Road, Bridgeport,
Belmont County, Ohio 43192, (the "Property").
WesBanco Bank, Inc. is a secured creditor of the Estate, holding
the first two mortgages on the Property, with that debt totaling
$1,637,162.41 as of May 3, 2022. In addition to WesBanco's two
mortgages, there are real estate tax obligations totaling at least
$35,980.15.
WesBanco claims that there must be some specific, verifiable and
guaranteed source of non-estate assets, or sources of revenue that
will be used to pay the potential shortfall over 4 years as this is
a single asset real estate case, and the Disclosure Statement and
Plan provide for the sale of the real estate.
WesBanco asserts that the Debtor's Disclosure Statement fails to
identify the source of the shortfall revenue.
WesBanco further asserts that the Debtor's failure to disclose how
the Plan may ultimately be consummated is both fatal to the
confirmation of the Plan and does not provide sufficient
information in the Disclosure Statement.
A full-text copy of WesBanco's objection dated June 2, 2022, is
available at https://bit.ly/3miqM7v from PacerMonitor.com at no
charge.
Attorneys for WesBanco:
MEYER, UNKOVIC & SCOTT, LLP
Jeffrey R. Lalama, Esquire
PA ID No. 52709
jl@muslaw.com
535 Smithfield Street
Suite 1300
Pittsburgh, PA 15222
412-456-2876 Telephone
412-456-2864 Facsimile
About VAL Properties
VAL Properties, LLC, sought protection for relief under Chapter 11
of the Bankruptcy Code (Bankr. W.D. Pa. Case No. 21-22384) on Nov.
3, 2021, listing up to $50,000 in assets and up to $1 million in
liabilities. Judge Carlota M. Bohm oversees the case. Donald
R. Calaiaro, Esq., at Calaiaro Valencik, is the Debtor's legal
counsel.
VBI VACCINES: Gets UK MHRA Marketing Authorization for PreHevbri
----------------------------------------------------------------
VBI Vaccines Inc. announced that the UK Medicines and Healthcare
Products Regulatory Agency (MHRA) has granted marketing
authorization for PreHevbri [Hepatitis B vaccine (recombinant,
adsorbed)] for active immunization against infection caused by all
known subtypes of the hepatitis B virus (HBV) in adults. It can be
expected that hepatitis D will also be prevented by immunization
with PreHevbri as hepatitis D (caused by the delta agent) does not
occur in the absence of hepatitis B infection.
UK marketing authorization follows the European Commission's (EC)
centralized marketing authorization received in April 2022, and was
conducted as part of the EC Decision Reliance Procedure (ECDRP).
VBI expects to make PreHevbri available in the UK in early 2023.
"We are pleased to announce this latest regulatory approval of
PreHevbri, our third in the span of six months, and another
significant milestone in our efforts to broaden access to our
differentiated 3-antigen vaccine," said Jeff Baxter, VBI's
president and CEO. "Based upon the safety and immunogenicity
profiles observed in the PROTECT and CONSTANT pivotal Phase 3
studies, data from which built the foundation of our FDA, EMA, and
now UK MHRA approvals, we continue to believe PreHevbri will be a
meaningful new intervention in the fight against hepatitis B."
About VBI Vaccines
VBI Vaccines Inc. -- www.vbivaccines.com -- is a biopharmaceutical
company driven by immunology in the pursuit of powerful prevention
and treatment of disease. Through its innovative approach to
virus-like particles ("VLPs"), including a proprietary enveloped
VLP ("eVLP") platform technology, VBI develops vaccine candidates
that mimic the natural presentation of viruses, designed to elicit
the innate power of the human immune system. VBI is committed to
targeting and overcoming significant infectious diseases, including
hepatitis B, coronaviruses, and cytomegalovirus (CMV), as well as
aggressive cancers including glioblastoma (GBM). VBI is
headquartered in Cambridge, Massachusetts, with research operations
in Ottawa, Canada, and a research and manufacturing site in
Rehovot, Israel.
VBI Vaccines reported a net loss of $69.75 million for the year
ended Dec. 31, 2021, compared to a net loss of $46.23 million for
the year ended Dec. 31, 2020. As of March 31, 2022, the Company
had $194.01 million in total assets, $33.99 million in total
current liabilities, $30.45 million in total non-current
liabilities, and $129.56 million in total stockholders' equity.
Iselin, New Jersey-based EisnerAmper LLP, the Company's auditor
since 2016, issued a "going concern" qualification in its report
dated March 7, 2022, citing that the Company has an accumulated
deficit as of Dec. 31, 2021 and cash outflows from operating
activities for the year-ended Dec. 31, 2021 and, as such, will
require significant additional funds to conduct clinical and
non-clinical trials, achieve regulatory approvals, and subject to
such approvals, commercially launch its products. These factors
raise substantial doubt about its ability to continue as a going
concern.
VIDEO DISPLAY: Incurs $2.6 Million Net Loss in FY Ended Feb. 28
---------------------------------------------------------------
Video Display Corporation filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss of
$2.56 million on $7 million of net sales for the year ended Feb.
28, 2022, compared to net income of $812,000 on $12.54 million of
net sales for the year ended Feb. 28, 2021.
As of Feb. 28, 2022, the Company had $7.12 million in total assets,
$5.40 million in total liabilities, and $1.71 million in total
shareholders' equity.
Management's plans with regard to improving working capital
includes increasing marketing efforts in its ruggedized displays,
TEMPEST services and small specialty displays. The Company is
developing new products for customers in the TEMPEST sector of its
business. Also, the Company has expanded its cyber security
business by adding a second testing chamber and a new testing
machine for testing tempest products. The Company is aggressively
seeking new business for this sector of its business and just
completed and had accredited its new AIS system allowing it to
increase the business in cyber testing services to supplement the
product side of the business.
The Company has streamlined its operations and is focusing on
increasing revenues by executing initiatives such as upgrading its
sales and marketing efforts including a more user friendly website
to market all the product lines it sells and email blasts to
targeted customers with specific product lines. These efforts have
not increased revenues to date as the Company's business typically
has longer lead times from initial contact to a sale. The pandemic
has also slowed down the process of obtaining new business as many
of the Company's customers and potential customers are still
working from home. Furthermore, supply chain challenges have
slowed down production of certain products due to long lead times
on critical items of production, impacting cash flow.
The Company moved the corporate accounting functions to the Cocoa,
Florida location which allows the Company to become more efficient
and save money on reducing redundant operations. The Company has
not automatically replaced employees who have left the Company
while it works to increase business. The Company reduced expenses
further by closing the Tucker, Georgia facility of March 31,2022.
If additional and more permanent capital is required to fund the
operations of the Company, no assurance can be given that the
Company will be able to obtain the capital on terms favorable to
the Company, if at all.
Peachtree Corners, Georgia-based Hancock Askew & Co., LLP, the
Company's auditor since 2017, issued a "going concern"
qualification in its report dated May 31, 2022, citing that the
Company has historically reported net losses or breakeven results
along with reporting low levels of working capital. These
conditions raise 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/758743/000119312522164074/d329377d10k.htm
About Video Display
Headquartered in Cocoa, Florida, Video Display Corporation
manufactures and distributes a wide range of display devices,
encompassing, among others, industrial, military, medical, and
simulation display solutions.
VISION ADELANTE: Has Deal with Coastal Capital on Collateral Access
-------------------------------------------------------------------
Mark M. Sharf, Chapter 11 Trustee of the bankruptcy estate of
Vision Adelante, and Coastal Capital Group LLC informed the U.S.
Bankruptcy Court for the Central District of California, Los
Angeles Division, that the parties have reached an agreement
regarding the Chapter 11 Trustee's use of cash collateral in
connection with the real property commonly known as 16411 Haas
Avenue, Torrance, California 90504 and now desire to memorialize
the terms of this agreement into an agreed order.
The Trustee desires to use the cash collateral generated by the
Property to pay the ordinary, necessary, and reasonable maintenance
and operating expenses of the Property including inter alia
property taxes, hazard insurance premiums, maintenance, utilities,
and property management expenses pending the sale of the Property.
CCG is the beneficiary under a deed of trust recorded against the
Property in the Official Records of the Los Angeles County
Recorder's Office on October 15, 2021 as document number
20211560002.
The Deed of Trust secures a promissory note dated October 8,2021,
in the original, principal amount of $616,000.
The Note provides for monthly payments of $6,160 from December 1,
2021 to October 1,2023, at which point all unpaid amounts are fully
due and payable.
On December 27, 2021, CCG filed a secured proof of claim in the
amount of $617,417.64 as Claims Register number 9-1.
The Property generates approximately $3,000 per month in rents. The
Trustee intends to sell the property.
CCG consents to the use of its cash collateral to pay the expenses
identified in paragraph J pursuant to 11 U.S.C. section
363(c)(2)(A) on the condition that the Trustee will provide CCG
with an accounting of the use of its cash collateral upon request
and sequester the cash collateral for CCG's benefit.
A copy of the Stipulation is available at https://bit.ly/3xfFxy0
from PacerMonitor.com.
About Vision Adelante
Torrance, Calif.-based Vision Adelante filed a petition for Chapter
11 protection (Bankr. C.D. Calif. Case No. 21-18528) on Nov. 8,
2021, listing as much as $10 million in both assets and
liabilities. Rosana A. Torres, principal, signed the petition.
The Debtor tapped the Law Offices of Sheila Esmaili as legal
counsel.
VOIP-PAL.COM INC: Issues 475K Preferred Shares to CEO Malak
-----------------------------------------------------------
The board of directors of VoIP-Pal.Com Inc. approved the
designation of 475,000 shares of the Company's authorized preferred
stock, par value $0.01 per share, as Series A preferred stock,
having the voting powers, designations, preferences, limitations,
restrictions and relative rights set forth in the certificate of
designation.
The material features of the Series A Stock are as follows:
1. Holders of Series A Stock are entitled to 1,550 votes per
share of Series A Stock on any matter submitted to a vote of the
Company's stockholders, and are generally entitled to vote together
as one class with holders of the Company's common stock;
2. Holders of Series A Stock are not entitled to receive any
dividends or other distributions in respect of any shares of Series
A Stock held by them;
3. Holders of Series A Stock are not entitled to receive any
assets of the Company upon a liquidation, dissolution or winding up
of the Company;
4. Shares of Series A Stock are not redeemable;
5. Shares of Series A Stock are not convertible or exchangeable
into shares of the Company's common stock; and
6. Shares of Series A Stock are not transferrable or assignable
without the prior written consent of the Company.
The Certificate of Designation was filed with the Nevada Secretary
of State on May 25, 2022, with the result that 525,000 shares of
the Preferred Stock remain authorized and eligible for designation
by the Board pursuant to the Company's articles of incorporation,
as amended.
Promptly following the filing of the Certificate of Designation,
the Company issued 475,000 shares of Series A Stock to Emil Malak,
the president, chief executive officer and a director of the
Company, at a price of $0.10 per Share in exchange for proceeds of
$47,500. The primary purpose of the issuance and, by extension,
the Designation, was to restore the voting rights that Mr. Malak
inadvertently forfeited in April 2021 in connection with the
surrender and relinquishment of an aggregate of 621,470,562 shares
of the Company's common stock that were indirectly held by Mr.
Malak.
The Shares were offered and sold to Mr. Malak in a private
transaction in reliance upon the exemption from registration
provided by Rule 903 of Regulation S promulgated under the
Securities Act of 1933, as amended. The Company's reliance on Rule
903 of Regulation S was based on the fact that Mr. Malak is not a
"U.S. person" as that term is defined in Rule 902(k) of Regulation
S, that Mr. Malak acquired the Shares for investment purposes for
his own account and not as nominee or agent, and not with a view to
the resale or distribution thereof, and that Mr. Malak understood
that the Shares may not be sold or otherwise disposed of without
registration under the Securities Act and any applicable state
securities laws, or an applicable exemption or exemptions
therefrom.
Also on May 24, 2022, the Board approved an increase in the
Company's authorized capital from 3,000,000,000 shares of common
stock, par value $0.001 per share, to 3,500,000,000 shares of
common stock, par value $0.001 per share, which action was
subsequently approved by the holders of a majority of the Company's
issued and outstanding stock on May 25, 2022. Pursuant to
applicable securities laws, the Company does not plan to effect the
Authorized Capital Increase until at least 20 days after a
definitive information statement on Schedule 14C has been
transmitted to the Company's stockholders who did not previously
consent to the Authorized Capital Increase.
About VOIP-PAL.com
Since March 2004, VOIP-PAL.com has developed technology and patents
related to Voice-over-Internet Protocol (VoIP) processes. All
business activities prior to March 2004 have been abandoned and
written off to deficit. The Company operates in one reportable
segment being the acquisition and development of VoIP-related
intellectual property including patents and technology.
VOIP-PAL.com reported a loss and comprehensive loss of $2.16
million for the year ended Sept. 30, 2021, compared to a loss and
comprehensive loss of $2.34 million for the year ended Sept. 30,
2020. As of March 31, 2022, the Company had $537,285 in total
assets, $181,288 in total liabilities, and $355,997 in total
stockholders' equity.
Vancouver, Canada-based Davidson & Company LLP, the Company's
auditor since 2015, issued a "going concern" qualification in its
report dated Dec. 14, 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.
VTV THERAPEUTICS: Inks Collaboration and License Deal With G42
--------------------------------------------------------------
vTv Therapeutics Inc. has entered into agreements that include a
$25 million investment by G42 Investments AI Holding RSC Ltd.
Under the terms of the agreements, G42 Investments acquired
10,386,274 shares of Class A Common Stock of vTv at an issue price
of $2.407 per share, with $12.5 million paid in cash at closing,
and the remaining amount of $12.5 million payable on May 31, 2023.
The agreements also provide for the potential issuance of $30
million in additional shares of Class A Common Stock to G42
Investments (or cash in lieu of such issuance at the option of G42
Investments) if the United States Food and Drug Administration
approves the marketing and sale of a pharmaceutical product
containing TTP399, a liver selective glucokinase activator, as the
active ingredient for treatment of type 1 diabetes in the United
States. The agreements set forth the terms under which vTv and an
affiliate of G42 plan to collaborate on clinical trials for
pharmaceutical products that contain TTP399, including G42's
affiliate funding a portion of the Phase 3 clinical trials for
TTP399, and vTv granting G42's affiliate an exclusive license to
develop and commercialize pharmaceutical products containing TTP399
in certain territories outside of the United States and the
European Union.
"We have focused substantial energy and resources on TTP399 since
obtaining Breakthrough Therapy designation from the FDA in April
2021 and are thrilled to welcome a partner to work with us to
accelerate the development and potential approval and
commercialization of this treatment. G42 Healthcare brings a
unique combination of strong commitment to the development of new
impactful drugs and treatments, as demonstrated by their success
and their leadership on COVID-19 testing and other product and
service offerings in the healthcare spectrum, and substantial
resources, making them an ideal partner for this program . This
investment into vTv will fund a substantial portion of our Phase 3
clinical trials for TTP399 in the United States and the
collaboration with G42 will fund certain of the Phase 3 clinical
trials that will be conducted in other territories. We are excited
to partner with the G42 Healthcare team as we launch our Phase 3
clinical trials and work together towards approval and
commercialization of this treatment for type 1 diabetes," said Rich
Nelson, interim chief executive officer of vTv.
Dr. Fahed Al Marzooqi, the chief operating officer of G42
Healthcare, noted that "We have a deep commitment to collaborating
with international organizations to share our knowledge and
expertise in the consumer and clinical health spectrum and we look
forward to working together with vTv to further develop and
commercialize this important treatment. As we move ahead, we will
continue to join forces with the world's best to innovate and
invest in science and create the next wave of medicines to
future-proof the health of nations."
About vTv Therapeutics
vTv Therapeutics Inc. is a clinical-stage biopharmaceutical company
focused on developing oral small molecule drug candidates. vTv has
a pipeline of clinical drug candidates led by programs for the
treatment of type 1 diabetes, Alzheimer's disease, and inflammatory
disorders. vTv's development partners are pursuing additional
indications in type 2 diabetes, chronic obstructive pulmonary
disease (COPD), and genetic mitochondrial diseases.
vTv Therapeutics reported a net loss attributable to the company of
$12.99 million for the year ended Dec. 31, 2021, compared to a net
loss attributable to the company of $8.50 million for the year
ended Dec. 31, 2020. As of March 31, 2022, the Company had $20.19
million in total assets, $13.91 million in total liabilities,
$14.37 million in redeemable noncontrolling interest, and a total
stockholders' deficit attributable to the company of $8.09
million.
Raleigh, North Carolina-based Ernst & Young LLP, the Company's
auditor since 2000, issued a "going concern" qualification in its
report dated March 29, 2022, citing that the Company has not
generated any product revenue, has not achieved profitable
operations, has insufficient liquidity to sustain operations and
has stated that substantial doubt exists about the Company's
ability to continue as a going concern.
WEBER INC: S&P Downgrades ICR to 'B', Outlook Negative
------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on U.S.-based
outdoor grill manufacturer Weber Inc. to 'B' from 'B+' and its
issue-level rating on its senior secured first-lien debt to 'B'
from 'B+'. S&P's '3' recovery rating on the debt remains unchanged,
indicating its expectation for meaningful (50%-70%; rounded
estimate: 60%) recovery in the event of a payment default.
The negative outlook reflects the potential that S&P will lower its
ratings on Weber if it is unable to stabilize its sales and improve
its EBITDA while managing its seasonal working capital to ensure it
maintains adequate liquidity heading into next year's selling
season.
The downgrade reflects Weber's much higher than expected leverage
because of its lower-than-forecast sales, which added to the
pressure it was already facing from ongoing supply chain challenges
and input cost inflation. The company's sales for the six months
ended March 31, 2022, declined by 7% year over year due to the
difficult comparison with its strong performance during the first
half of last year, as well as the declining volume of consumer
traffic at retail locations and the limited availability of certain
products due to ongoing supply chain constraints. Weber's EBITDA
margins for the 12 months ended March 31, 2022, also fell by 300
basis points (bps) year over year because supply chain constraints
continued to outweigh the benefits from its recently implemented
price increases. The company's trailing-12-month debt to EBITDA
increased to 11.1x as of the end of its second quarter, which
compares with 4.5x as of the end of the same fiscal quarter last
year. S&P said, "Weber's weaker-than-expected sales volumes have
prompted it to lower its sales and EBITDA expectations for fiscal
year 2022, including EBITDA of $140 million-$180 million on a
covenant-defined basis, which adds back certain one-time charges
that we don't include in our calculations. Including these one-time
charges, we believe the company's EBITDA for fiscal year 2022 will
be closer to $100 million-$120 million, which would lead to
leverage of near 10x."
S&P said, "Management's actions to mitigate the company's operating
challenges are starting to take hold, though we don't expect it
will quickly recover its sales and EBITDA to fiscal-year 2021
levels. The company implemented its third round of pricing actions
at the end of the second quarter of fiscal year 2022 that went into
effect April 1 in the third quarter. Weber has now also fully
lapped its first price increase in April 2021. Management also
continues to cut costs while investing in ongoing operating
efficiency projects, such as its global implementation of SAP's
enterprise resource management system and recently opened Polish
manufacturing facility, which will improve its long-term margin
profile. These ongoing cost-mitigation efforts led to a more than
10% sequential improvement in its gross margins in the second
quarter and will likely continue to sequentially improve its
margins in the coming quarters, which will enable the company to
slowly reduce its leverage. Still, we believe Weber's very strong
performance in fiscal year 2021 likely brought forward some of its
future sales, which--coupled with slowing economic growth--will
mute the potential for a sudden rebound in its EBITDA once supply
chain constraints normalize and input cost inflation abates.
Therefore, we assume the company's deleveraging will be slower than
we previously expected and now forecast its leverage will remain
above 5x through fiscal year 2023 before declining to the mid-4x
range thereafter."
Although the company's free operating cash flow (FOCF) will remain
negative, working capital inflows and the lapping of last calendar
year's very weak second half will likely enable it to restore its
covenant cushion and maintain adequate liquidity heading into
fiscal year 2023. The downward revision of our projected EBITDA
coupled with management's ongoing capital investments for the
implementation of SAP's products and the ramping up of its polish
manufacturing facility will result in a FOCF outflow of more than
$100 million this year. Still, Weber will likely finish the year
with ample liquidity after terming out its short-term debt in the
second quarter with a $250 million incremental term loan B issuance
maturing in 2027. Moreover, the company is entering its seasonal
working capital inflow cycle in its fiscal third and fourth
quarters and will face easy year-over-year EBITDA comparisons with
its fiscal fourth quarter in 2021. This will likely alleviate its
covenant pressure following its compliance with its maximum debt to
EBITDA covenant of 7x with a cushion of less than 15% for the
trailing-12-months ended March 31, 2022. The expected working
capital inflow will likely enable Weber to repay the outstanding
borrowings on its revolving credit facility and avoid triggering
the covenant in the coming quarters (it is triggered when the
revolver is more than 35% drawn). In addition, our expectation for
continued sequential margin expansion and easier future quarterly
comparisons will likely enable it to restore its covenant cushion
to more than 15% by the first quarter of fiscal year 2023, when it
will need to draw on its liquidity facilities to build working
capital. However, if the company substantially underperforms our
expectations and the working capital does not unwind, then the
company could experience very tight cushion or violate the
covenant, if triggered.
S&P said, "Notwithstanding the short-term setbacks, we still view
Weber's long-term operating outlook as favorable. We believe the
company will continue to benefit from favorable long-term growth in
the demand for new grills and associated grilling equipment and
expect its top-line revenue will rise at a modestly faster pace
than the industry average (in the low-single-digit percent area),
as it has both historically and through prior economic downturns.
Absent the ongoing supply chain and foreign-exchange headwinds,
Weber's global manufacturing footprint and sales diversity provide
it with a competitive advantage in accessing the high-growth
developing markets and securing distribution partners to support
its growth prospects. Further, the company's leading global market
share in the outdoor grill category, brand strength, and new
product innovation (particularly in smart appliances) support its
superior pricing power.
"The negative outlook on Weber reflects the potential that we will
lower our rating if it is unable to stabilize its sales and improve
its EBITDA while managing its seasonal working capital to ensure it
maintains adequate liquidity heading into next year's selling
season.
"We could lower our rating on Weber concurrent with a reassessment
of its business risk profile if it does not sufficiently unwind its
seasonal working capital build to improve its covenant cushion and
ensure adequate liquidity while restoring its sales, improving its
annual EBITDA back above $200 million, and reducing its debt to
EBITDA below 7x by the first half of fiscal year 2023." This could
occur if:
-- Supply chain constraints persist and input cost inflation
worsens, reversing the recent improvement in the company's gross
margins;
-- The declines in its sales volumes accelerate; and
-- Its working capital inflows are lower than expected, which
precludes it from repaying its short-term debt and limits its
ability to fund next year's working capital requirements due to
covenant constraints.
S&P could revise its outlook on Weber to stable if it reduces its
leverage below 7x. This could occur by the first half of fiscal
year 2023 if:
-- Its working capital inflows in the coming quarters provide it
with sufficient liquidity to fund next year's working capital
requirements;
-- Its pricing actions largely offset ongoing freight and input
cost inflation; and
-- The one-time charges for its business restructuring, the
start-up of its Poland facility, and its SAP implementation roll
off as anticipated in the coming quarters.
ESG credit indicators: E-2; S-2; G-3
WISECARE LLC: Wins Cash Collateral Access Thru Aug 1
----------------------------------------------------
The U.S. Bankruptcy Court for the District of Maryland, Baltimore
Division, approved the stipulation that Wisecare, LLC entered into
with Steans Bank, NA regarding the Debtor's use of cash
collateral.
The Debtor is authorized to use cash collateral only to fund the
expenses provided on the June and July 2022 budget, the Adequate
Protection Payments, and the administrative claim escrow payments.
The authorization granted to the Debtor under the Second Interim
Order shall terminate upon the earlier of: (a) August 1, 2022; (b)
the entry by the Court of an order denying the Debtor's
authorization to use cash collateral; or (c) at the option of the
Lender, upon the occurrence of an Event of Default after notice and
the expiration of the cure period as set forth in the First Interim
Order.
Notwithstanding any termination, the rights and obligations of the
Debtor and the rights, claims, security interests, liens and
priorities of the Lender with respect to all transactions that
occurred prior to the occurrence of any termination, including,
without limitation, all replacement liens granted to the Lender as
adequate protection and priority claims under Section 507(b) of the
Bankruptcy Code, which are provided, will remain unimpaired and
unaffected by any termination of the Order, will survive any
termination of the Order, and will be binding upon the Debtor, its
estate, all successors in-interest to the Debtor, including any
Chapter 11 trustee or any Chapter 7 trustee, and all creditors and
other parties in interest.
As adequate protection, the Lender is granted replacement liens and
superpriority treatment on the same terms as provided by the First
Interim Order.
A copy of the order is available at https://bit.ly/3GM7Ozz from
PacerMonitor.com.
About WiseCare LLC
WiseCare, LLC offers a variety of diagnostic and treatment services
for the urgent care needs of patients of all ages. Severn,
Md.-based WiseCare filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Md. Case No. 21-17794)
on Dec. 14, 2021, listing $100,000 to $500,000 in assets and $1
million to $10 million in liabilities. Perry Weisman, its owner,
signed the petition. Joseph Selba, Esq., at Tydings & Rosenberg,
LLP serves as the Debtor's legal counsel.
Judge David E. Rice oversees the case.
Stearns Bank NA, as lender, is represented by Robert B. Scarlett,
Esq., at Scarlett & Croll, P.A.
WOLVERINE WORLD: Moody's Affirms Ba1 CFR & Alters Outlook to Neg.
-----------------------------------------------------------------
Moody's Investors Service changed Wolverine World Wide, Inc.'s
outlook to negative from stable. Concurrently, Moody's affirmed the
company's Ba1 corporate family rating, Ba1-PD probability of
default rating, and Ba2 senior unsecured notes rating. The
company's speculative grade liquidity rating was changed to SGL-2
from SGL-1.
The outlook change to negative reflects the risk that Wolverine may
not substantially reduce leverage from its current level of 4.5x
Moody's-adjusted debt/EBITDA over the next 12 months. In addition,
the change in outlook reflects governance factors, including the
company's decisions to finance the Sweaty Betty acquisition with
debt and to continue share repurchases rather than reduce debt
levels.
"Debt reduction following the Sweaty Betty acquisition has been
delayed as the company is replenishing its inventory, returning
capital to shareholders and paying for environmental remediation
and associated litigation," stated Moody's Vice President, Raya
Sokolyanska. "In addition, while consumer demand for footwear and
apparel is strong, earnings could be hampered by supply chain
challenges, inflationary pressures and a potential moderation in
outdoor and athletic footwear as consumer spending pivots to travel
and leisure."
The SGL downgrade to SGL-2 from SGL-1 reflects Moody's expectations
for negative free cash flow over the next 12 months, partly
mitigated by over $600 million in revolver availability and ample
covenant cushion.
Moody's took the following rating actions for Wolverine World Wide,
Inc.:
Corporate Family Rating, Affirmed Ba1
Probability of Default Rating, Affirmed Ba1-PD
Senior Unsecured Global Notes, Affirmed Ba2 (LGD5)
Speculative Grade Liquidity Rating, Downgraded to SGL-2 from
SGL-1
Outlook, Changed to Negative from Stable
RATINGS RATIONALE
Wolverine's Ba1 CFR reflects its diversified distribution in the
global footwear industry, and the dependable replenishment demand
cycle of the footwear category due to normal product wear and tear.
About half of the company's revenue is generated from its
well-recognized, large brands Merrell, Saucony and Sperry, and its
product portfolio appeals to a broad range of consumer needs and
demographics. Moody's expects credit metrics to improve over the
next 12-18 months, to high-3x debt/EBITDA from 4.5x as of April 2,
2022, driven by earnings increases and modest revolver repayment.
The rating is also supported by the company's balanced financial
strategies and good liquidity. At the same time, the ratings are
constrained by the company's relatively small revenue scale, narrow
product focus primarily in the footwear segment, and fashion risk.
In addition, the company's growth strategy has included
acquisitions, which introduces event, execution and financing risk.
In addition, as a footwear company, Wolverine is subject to social
and environmental risks related to responsible sourcing, the
treatment of work force, and data protection.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
While not likely over the near-to-intermediate term given its small
revenue scale and narrow product focus, over time, Wolverine's
ratings could be upgraded if it were to sustainably reduce
financial leverage through debt reduction and profitable growth and
maintain very good liquidity. An upgrade would also require
increased diversification via international expansion or a broader
portfolio of brands or products, as well as a commitment to
maintaining an investment grade profile, including credit metrics
stronger than the quantitative upgrade triggers. Quantitative
measures include Moody's- adjusted debt/EBITDA sustained below
3.0x, EBITA/interest expense above 5.5x, and FFO/Net debt above
35%.
Ratings could be downgraded if the company does not delever through
debt repayment and earnings growth, or if it undertakes more
aggressive financial policies such as a sizable debt-financed
acquisitions or share repurchases. Quantitative measures include
Moody's-adjusted debt/EBITDA sustained above 3.5x or EBITA/interest
expense below 4.0x beyond year-end 2022.
Wolverine is a designer and marketer of casual, active lifestyle,
work, outdoor sport, athletic, children's and uniform footwear and
apparel. The company's portfolio of brands includes Merrell,
Saucony, Sperry, Sweaty Betty, Hush Puppies, Wolverine, Keds,
Chaco, Bates, HYTEST and Stride Rite. The company also is the
global footwear licensee of the Cat and Harley-Davidson brands.
Revenue for the latest twelve months ended April 2, 2022 was around
$2.5 billion.
The principal methodology used in these ratings was Apparel
published in June 2021.
YUNHONG CTI: Falls Short of Nasdaq Minimum Bid Price Requirement
----------------------------------------------------------------
Yunhong CTI Ltd. received written notice from The Nasdaq Capital
Market stating that the Company was not in compliance with Nasdaq
Listing Rule 5550(a)(2) because the Company's common stock failed
to maintain a minimum closing bid price of $1.00 for 30 consecutive
business days. The Notice has no immediate effect on the Nasdaq
listing or trading of the Company's common stock.
The Notice provides an initial 180 calendar day period, or until
Nov. 22, 2022, in which to regain compliance, pursuant to Listing
Rule 5810(c)(3)(A). If, at any time before that date the bid price
of the Company's common stock closes at $1.00 per share or more for
a minimum of 10 consecutive business days, Nasdaq will notify the
Company that it has achieved compliance with the Minimum Bid Price
Rule.
The Company intends to actively monitor the closing bid price of
its common stock and will evaluate available options to regain
compliance with the Minimum Bid Price Rule.
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.
Yunhong CTI reported a net loss of $7.55 million for the 12 months
ended Dec. 31, 2021, a net loss of $4.29 million for the 12 months
ended Dec. 31, 2020, and a net loss of $8.07 million for the 12
months ended Dec. 31, 2019. As of March 31, 2022, the Company had
$18.26 million in total assets, $14.20 million in total
liabilities, and $4.06 million in total shareholders' equity.
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.
*********
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