/raid1/www/Hosts/bankrupt/TCR

/raid1/www/Hosts/bankrupt/TCR_Public/220713.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, July 13, 2022, Vol. 26, No. 193 Headlines 6200 NE 2ND AVENUE: Kevter Says 3rd Amended Plan Same as Previous 6200 NE 2ND AVENUE: Unsecureds Owed $400K Unimpaired in Plan ALLIANCE MECHANICAL: Taps Blackwood Law Firm as Bankruptcy Counsel ATIS HOLDINGS: Unsecured Creditors to Split $10K in 36 Months BASA INVESTMENTS: Amends Plan to Include Amy Stanley Disputed Claim BETTER 4 YOU BREAKFAST: Wins Cash Collateral Access Thru July 15 BIOLASE INC: Amends Credit Agreement With SWK Funding BROOKFIELD RESIDENTIAL: S&P Affirms 'B' ICR, Alters Outlook to Neg. BURTS CONSTRUCTION: Taps Daniel Lazo as Real Estate Agent CENSO LLC: Returns to Chapter 11 Bankruptcy CLEARDAY INC: Secures $540K Loan; Maturity Date Extended CYPRESS CREEK: Amends Frost Bank Secured Claim Pay Details DR. R'KIONE BRITTON: Taps Scott Christansen as Bookkeeper EASCO BOILER: Seeks Cash Collateral Access ERNIE'S EMPIRE: 3rd Gear Restaurant Files for Chapter 7 Bankruptcy FREEPORT GATE: Files Chapter 11 Subchapter V Case FREEPORT LNG: S&P Downgrades ICR to 'B-' on Weak Liquidity HAIL MARY: Seeks Cash Collateral Access HAWAIIAN HOLDINGS: Appoints Two New Directors HERBALIFE NUTRITION: S&P Alters Outlook to Neg., Affirms 'BB-' ICR INDIANA WELLNESS: Case Summary & 15 Unsecured Creditors INNOVATIVE GLOBAL: Case Summary & 10 Unsecured Creditors J.T. SHANNON: Case Summary & 20 Largest Unsecured Creditors JEFFERSON CAPITAL: Fitch Affirms LT IDR at 'BB-'; Outlook Stable JOANN INC: S&P Downgrades ICR to 'B-' on Performance Challenges KAYA HOLDINGS: "Greek Kay" Gets Cannabis Installation License KINSEY & KINSEY: Taps Foster Legal Services as Bankruptcy Counsel LTL MANAGEMENT: Bankruptcy Judge Postpones Automatic Stay Argument MOUNTAIN RECOVERY: Stubblefields & Firms File Subchapter V Cases MW HEALTHCARE: Fitch Affirms 'BB' IDR, Outlook Negative NEONODE INC: Further Adjourns Annual Meeting Until July 15 ODONATA LTD: Cowlicks Japan Seeks Chapter 11 Protection ONE AND ONE: Seeks to Hire Maltz Auctions as Real Estate Broker PATH MEDICAL: Plan Hearing Delayed to July 15 PLATFORM II: Case Summary & 20 Largest Unsecured Creditors PRA GROUP: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable PRECISION AUTOMOTIVE: Taps Lefkovitz & Lefkovitz as Legal Counsel QUICKER LIQUOR: Says Plan Confirmable, Seeks Talks With Moody QUICKER LIQUOR: Unsecureds to Recover 100% Without Interest in Plan REMARK HOLDINGS: All Four Proposals Passed at Annual Meeting REVENANT DENVER: Unsecureds Owed $1M to be Paid 100% With Interest RICHMOND HOSPITALITY: Taps LaMonica Herbst & Maniscalco as Counsel RIVERSTONE RESORT: Taps Munsch Hardt Kopf & Harr as Special Counsel SAB AB: Scandinavian Airlines Expects $700M Financing in Weeks SCHULTE PROPERTIES: Plan Headed to Confirmation Hearing SIGNET JEWELERS: S&P Alters Outlook to Positive, Affirms 'BB-' ICR SNIPER SERVICES: Seeks to Hire Eric A. Liepins as Legal Counsel SUMMER AVE: Wins Cash Collateral Access Thru Aug 18 TANGO HOMES: Seeks to Hire Langley & Banack as Bankruptcy Counsel TWITTER INC: S&P Retains 'BB+' ICR on CreditWatch Negative UNIVERSAL DOOR: Taps CPA Luis R. Carrasquillo as Consultant UNIVERSAL DOOR: Taps Fuentes Law Offices as Bankruptcy Counsel VOYAGER DIGITAL: Files Dual-Track Chapter 11 Plan WESTERN AUSTRALIAN: Seeks to Hire David M. Cole as Accountant ZENTUARY GROUP: Seeks Cash Collateral Access ********* 6200 NE 2ND AVENUE: Kevter Says 3rd Amended Plan Same as Previous ----------------------------------------------------------------- Interested Party, Kevter, Inc., filed an objection to 6200 NE 2nd Avenue, LLC et al.'s Third Amended Plan and Disclosure Statement Filed in Connection Therewith in light of the fact that but for including one additional debtor in the proposed, Third Amended Plan, the Third Amended Plan is substantially the same as the Second Amended Plan. Kevter incorporates all of its arguments contained in Interested Party Kevter, Inc.'s Objections to Debtor's Proposed Second Amended Plan (ECF No. 114) and Disclosure Statement Filed in Connection Therewith (ECF No. 115), and Objection to Confirmation. [ECF No. 135 with the following link https://bit.ly/3Ivyu8n and below is the summary]. Interested Party, Kevter, Inc. ("Kevter"), files its Objections to Second Amended Plan (ECF No. 114) and Disclosure Statement Filed in Connection Therewith (ECF No. 115), and Objection to Confirmation (the "Objections"), and as grounds therefore, states as follows: Kevter points out that in the Plan, each of the Debtors, each an owner of one or more parcels of real property, proposes to sell its property along with all of the other Debtors' property to an entity named "LH OP Zone Investors, LLC" ("LOZ") and then utilize the proceeds to pay claims of their respective bankruptcy estates. But the Debtors intend to pay only claims, leaving nothing left for equity holders whose interests under the Plan will be extinguished following confirmation. Plan, Article III, Sec. (1)(d)(ii) at 14. Kevter further points out that for it is clear that the Debtors are trying to consummate a series of real estate transactions through a bankruptcy plan that will require just enough funds to pay claims but leave not a dollar on the table for equity holders. In addition, the Plan calls for the extinguishment of all equity interests in the Debtors once the sales are completed. If the Debtors are successful, Kauderer may achieve his goal of preventing Kevter from obtaining satisfaction of its claims by making nothing available for Kevter to execute upon, while ultimately retaining the equity via entities he controls, apparently without consideration. As a result the Plan is not proposed in good faith. According to Kevter, in the instant case, the Debtors did not entertain any other offers and the record is devoid of any efforts by Debtors to market the properties. Thus, none of the factors that mitigate a proposed sale to insiders are present in this case and, as such, the proposed sale to LOZ fails to satisfy the heightened scrutiny standard and should be rejected, thus, resulting in denial of confirmation of the Plan. Kevter asserts that absent further disclosures on the part of Debtors, there is no way any interested party (other than Debtors and LOZ themselves) would, as a "hypothetical reasonable investor", be able to obtain information regarding LOZ other than from what is contained in the Disclosure Statement. Kevter points out that the Plan is similarly flawed and violates the requirements of section 1129(a) governing what is required for confirmation of a chapter 11 plan. In this case, the Plan violates section 1129(a)(3) because it was not filed in good faith. Kevter asserts that further evidence of Debtors' bad faith can be found by comparing Debtors' initial filings with that now before the Court in connection with confirmation. According to Debtor's early filings, the properties as of the petition date, other than that owned by the debtor 6229 NE 2nd Avenue, LLC, were collectively worth approximately $5.425 million, against which the first mortgage holder held a claim for what the Debtors estimated to be $7.8 million. When combined with the property owned by the debtor 6229 NE 2nd Avenue, LLC, the total value of the properties, according to the Debtors, was initially $6.2 million. But now that Debtors are under pressure to obtain confirmation of a plan, low and behold, the properties are now worth approximately $9.862 million. Which is a fictitious number because it is the estimated number needed to pay the $7.75 million and $1.061 million first mortgage claims, other secured claims of $337,000, administrative expenses and U.S. Trustee fees of $295,000, and unsecured debts totaling approximately $400,000. If more is needed to pay the foregoing, the purchase price will increase accordingly. But again, the total number is flexible, so long as it pays all claims in full and leaves exactly zero for equity. Attorneys for Kevter, Inc.: Chad P. Pugatch, Esq. Jason E. Slatkin, Esq. LORIUM LAW 101 N.E. Third Ave., Suite 1800 Fort Lauderdale, FL 33301 Telephone: (954) 462-8000 Facsimile: (954) 462-4300 E-mail: jslatkin@loriumlaw.com About 6200 NE 2nd Avenue 6200 NE 2nd Avenue, LLC, and its affiliates are Florida limited liability companies, which, together, own 14 parcels of real property in the Little Haiti/Upper East Side neighborhood largely on the Northeast 2nd Avenue corridor of Miami. Several of these properties are not generating income largely as a result of the COVID-19 pandemic, and after certain properties were gutted in anticipation of renovation and the failure of an investor to raise and invest sufficient funds to complete the renovations. 6200 NE 2nd Avenue and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Lead Case No. 22-10385) on Jan. 18, 2022. In the petition signed by Mallory Kauderer, manager, 6200 NE 2nd Avenue disclosed up to $50,000 in assets and up to $10 million in liabilities. Judge Robert A. Mark oversees the cases. Steven Beiley, Esq., at Aaronson Schantz Beiley P.A., is the Debtors' legal counsel. 6200 NE 2ND AVENUE: Unsecureds Owed $400K Unimpaired in Plan ------------------------------------------------------------ 6200 NE 2nd Avenue, LLC, et al., submitted a Plan and a Disclosure Statement. All Allowed Creditors with Allowed Claims, and all Allowed Administrative Expenses, will be paid in full, with accrued per diem interest through the Effective Date, from the proceeds of the Purchase Transaction. Class 8, which is disputed, will be paid, if at all. The consideration involved in the Purchase Transaction shall be adjusted up or down so as to cover 100% of the allowed creditors in this case. Pursuant to the Purchase Transaction and 11 U.S.C.s 1123(b)(4), the Debtors will sell all the Debtors' Properties to LH OP Zone Investors, LLC ("LOZ") as follows and the proceeds of the sale will be allocated and distributed to Allowed Creditors under the Plan on the Effective Date. On the Effective Date, the Plan provides for: (1) payment of all administrative debt; (2) payment of $8,856,991 to LH Gateway, with interest as provided in the Chemtov Foreclosure Judgment, in full satisfaction and discharge LH Gateway's Allowed Secured Claim; (3) payment to G Shores of $1,061,867, plus interest as provided in the G Shores Foreclosure Judgment and subsequently awarded attorney fees, in full satisfaction and discharge of G Shore's Allowed Secured Claim; (4) payment to Perdomo of $844,938.18, plus interest as provided in the Perdomo Foreclosure Judgment, in full satisfaction and discharge of Perdomo's Allowed Secured Claim; (5) payment in full of all Allowed Secured Claims of Miami-Dade County Tax Collector and Tax Certificate Holders for real estate taxes owed on the Little Haiti Debtor Properties; (6) payment in full of all Allowed Priority Claims of the Little Haiti Debtors; and (7) payment in full of Allowed General Unsecured Claims of the Little Haiti Debtors. Interest on all Claim amounts will be calculated to the Effective Date. All Allowed Claims against Debtors 6229 and 5823 other than G Shores and Perdomo will be paid in full on a date to be established in the Confirmation Order or other Order of the Court after the Claims Bar Date and Claims Objection Date established for creditors of Debtor 6229 and Debtor 5823 have passed. Under the Plan, Class 5 Allowed Unsecured Claims total $400,000. Allowed Claims of Class 5 (other than Class 5 Claims of Debtors 6229 and 5823) will be paid in full (including federal judgment rate interest from the Petition Date) on the Effective Date. Class 5 Allowed Claims of Debtors 6229 and 5823 will be paid in full, with federal judgment rate interest from the Petition Date, by a date set by the Court after the Claims Bar Date (6229 & 5823) and Claims Objection Date have passed and all Claims of Debtors 6229 and 5823 have been resolved. Further, because this Class will be paid in full with interest. Class 5 is unimpaired. Attorneys for the Jointly Administered Debtors: Geoffrey S. Aaronson, Esq. Tamara D. McKeown, Esq. AARONSON SCHANTZ BEILEY P.A. One Biscayne Tower, 2 S. Biscayne Blvd., 34th Floor Miami, Florida 33131 Tel: 786.594.3000 Fax: 305.424.9336 E-mail: gaaronson@aspalaw.com tmckeown@aspalaw.com A copy of the Disclosure Statement dated July 2, 2022, is available at https://bit.ly/3Pcmzyx from PacerMonitor.com. About 6200 NE 2nd Avenue 6200 NE 2nd Avenue, LLC, and its affiliates are Florida limited liability companies, which, together, own 14 parcels of real property in the Little Haiti/Upper East Side neighborhood largely on the Northeast 2nd Avenue corridor of Miami. Several of these properties are not generating income largely as a result of the COVID-19 pandemic, and after certain properties were gutted in anticipation of renovation and the failure of an investor to raise and invest sufficient funds to complete the renovations. 6200 NE 2nd Avenue and its affiliates sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Lead Case No. 22-10385) on Jan. 18, 2022. In the petition signed by Mallory Kauderer, manager, 6200 NE 2nd Avenue disclosed up to $50,000 in assets and up to $10 million in liabilities. Judge Robert A. Mark oversees the cases. Steven Beiley, Esq., at Aaronson Schantz Beiley P.A., is the Debtors' legal counsel. ALLIANCE MECHANICAL: Taps Blackwood Law Firm as Bankruptcy Counsel ------------------------------------------------------------------ Alliance Mechanical, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of Oklahoma to employ Blackwood Law Firm, PLLC to serve as legal counsel in its Chapter 11 case. The firm's attorneys will be paid up to $275 per hour. Legal assistants and law clerks will charge an hourly fee of $75. As disclosed in court filings, Blackwood neither holds nor represents any interest adverse to the Debtor's bankruptcy estate. The firm can be reached through: Amanda R. Blackwood, Esq. Blackwood Law Firm, PLLC P.O. Box 6921 Moore, OK 73153 Telephone: 405-232-6357 Facsimile: 405-378-4466 Email: amanda@blackwoodlawfirm.com About Alliance Mechanical Alliance Mechanical, LLC filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. W.D. Okla. Case No. 22-11002) on May 16, 2022, disclosing up to $100,000 in assets and up to $500,000 in liabilities. Stephen J. Moriarty of Fellers, Snider, Blankenship, Bailey & Tippens serves as Subchapter V trustee. Judge Sarah A. Hall oversees the case. Gary D. Hammond, Esq., at Mitchell & Hammond is the Debtor's counsel. ATIS HOLDINGS: Unsecured Creditors to Split $10K in 36 Months ------------------------------------------------------------- Atis Holdings, LLC, filed with the U.S. Bankruptcy Court for the Middle District of Florida a Plan of Reorganization under Subchapter V dated July 7, 2022. The Debtor is a Florida limited liability company that was formed in 2010 by Atis Kalnins. At the time the Bankruptcy Case was filed, the Debtor operated coin laundry facilities in Lakeland, Orlando, and Kissimmee, Florida. In 2019, Atis Kalnins passed away, and his wife Sandra Kalnins has taken over operations of the Debtor. Currently only the Orlando location is operating. The Debtor plans on closing the Lakeland and Kissimmee locations and selling the equipment to partially satisfy secured obligations. The Debtor files this Plan of Reorganization to restructure certain secured obligations and provide a dividend to unsecured creditors. Class One represents the secured claim of Dexter Financial of $53550.29. The Claim of Dexter Financial will retain all liens it held prepetition and be paid with interest accruing at 5.99 percent per annum on a ten-year amortization and term. Monthly payments of $594.00 shall commence 90 days from the effective date. Class Two represents the claim of Valley National Bank of $147,416.93. The Claim of Valley National Bank will be paid with interest accruing at 5.25% per annum on a fifteen-year amortization and five-year term. During the term, the Debtor may sell certain equipment encumbered by the Class Two Claimant, which such sums shall be devoted to partially satisfying the Claim. Class Two will retain all liens it held prepetition, and as long as payments are made pursuant to Plan treatment, Class Two Claimant shall refrain and forbear from enforcing its rights of default in respect to this obligation against the guarantor of the loan. Monthly payments of $1,185.00 shall commence 90 days from the effective date. Class Three represents allowed general unsecured claims in the case. The Debtor proposes to pay a pot plan paying allowed Class Five unsecured claims in $10,000.00 without interest on a pro-rata basis in thirty-five equal monthly installments of $250.00 and a final installment in month 36 of $1250. The initial payment commencing on the 90th day after the Effective Date of the Plan. The Plan contemplates that the Reorganized Debtor will continue to operate as a coin laundry facility at the Orlando location. The Plan contemplates the eventual sale of equipment currently located at the Lakeland and Kissimmee locations that is encumbered by Valley National Bank to partially satisfy the claim of Valley National Bank. The Reorganized Debtor believes that his continued earnings through business operations will be sufficient to fund the payments required to be made under the Plan. A full-text copy of the Plan of Reorganization dated July 7, 2022, is available at https://bit.ly/3uDlyb1 from PacerMonitor.com at no charge. Attorneys for Debtor: James W. Elliott, Esquire Florida Bar Number: 40961 james@mcintyrefirm.com McIntyre Thanasides Bringgold Elliott Grimaldi Guito & Matthews, P.A. 500 E. Kennedy Blvd., Ste. 200 Tampa, FL 33602 Telephone: (813) 223-0000 Facsimile: (813) 225-1221 About Atis Holdings Atis Holdings, LLC is an operator of coin-operated laundries and drycleaners located at 16226 Bridgepark Drive, Lithia, Fla. Atis Holdings filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-00919) on March 9, 2022, disclosing as much as $1 million in both assets and liabilities. Ruediger Mueller serves as Subchapter V trustee. Judge Catherine Peek Mcewen oversees the case. James W. Elliott, Esq., at McIntyre Thanasides Bringgold Elliott, Shochet Law Group and Accurate Tax & Bookkeeping Services, LLC serve as the Debtor's bankruptcy counsel, special counsel and accountant, respectively. BASA INVESTMENTS: Amends Plan to Include Amy Stanley Disputed Claim ------------------------------------------------------------------- Basa Investments, LLC, Shepherd Realty Investments, Inc. and Damaca Investments, LLC submitted a Joint Fourth Amended Subchapter V Plan of Reorganization dated July 7, 2022. The Debtors intend to fund their respective reorganizations and repayments to creditors from revenues the Debtors project to generate from the sale or transfer of the Debtors' properties to the extent necessary after the adjudication of the Debtors' claims objections. The Debtor has filed objections to claims and intends to pay all allowed claims in full. The Debtor's main creditor in this case is Amy Stanley. The Debtors and Ms. Stanley have been involved in protracted litigation concerning funds that she claims are loans or investments in either the Debtors themselves or properties acquired by the Debtors. Ms. Stanley has filed a proof of claim for $2,604,122.92 as a secured claim in each of the Debtor's respective cases. The Debtors dispute that Ms. Stanley is a creditor, secured or unsecured, for the sums utilized by the Debtors because the Debtors, through their principal, Ariel Banegas, claim that funds Ms. Stanley either transferred or utilized by the Debtors either directly or indirectly were intended by Ms. Stanley and Mr. Banegas to be a gift to Mr. Banegas. The Debtors acknowledge that Amy Stanley transferred $1,204,836.00 to or for the benefit of the Debtors. A hearing on the Debtors' claim objections to Ms. Stanley's claim is scheduled for July 14, 2022 contemporaneously with the hearing on the confirmation of the Plan. Accordingly, the Plan is created to address two scenarios. The first scenario contemplates a disallowance of any claim in favor of Ms. Stanley. The second scenario contemplates the allowance of a claim in favor of Ms. Stanley for the amount of transfers made directly or indirectly to Mr. Banegas for transfers to or for the respective Debtors' behalf. Damaca intends to sell its interests in the 5329 W. Atlantic Ave. Property and the 2324 S. Congress Property without regard to whether Ms. Stanley has an allowed claim. The Debtors believe that the fair market value of the 5329 W. Atlantic Ave. Property is at least $380,000 and the fair market value of the 2324 S. Congress Property is at least $125,000.00. The Debtors believe that the net proceeds from the sale will be sufficient to pay all allowed administrative expense, priority and secured and unsecured claims in full the event that Ms. Stanley does not have an allowed claim. In the event, Ms. Stanley is determined to have an allowed claim, the Debtor intends to pay all other creditors with allowed claims in full from the sale of the 5329 W. Atlantic Ave Property and the 2324 S. Congress Property and the transfer of sufficient property value to Ms. Stanley to satisfy her claim, if any, subject to any liens, claims or interests so long as the net value equals the amount of Ms. Stanley's claim, if any, which the Debtors acknowledge will be $1,204,836.00. The Debtor will transfer the following properties to Ms. Stanley: the 828 Burch Drive Property, the 1342 9th Ave Property, the 944 Market Street Property and the 748 MLK Blvd. Property on the Effective Date of the Plan. Basa will retain the 3749 Washington Street unless the proceeds of the sale of the 5329 W. Altantic Ave Property and 2324 S. Congress Property are insufficient to pay the claims of creditors contemplated to be paid with the proceeds of the sale of those properties. Class 19 consists of Unsecured Creditors. The Debtor intends to pay all allowed non-priority, unsecured claims in full. The Debtor intends to sell the 5329 W. Atlantic Ave. Property and the 2324 S. Congress Property. As set forth above, in the event that the Court determines that Amy Stanley is not the holder of an allowed claim, the Debtor believes that the proceeds from the sale of the 5329 W. Atlantic Avenue Property and the 2324 S. Congress Property will be sufficient to allow holders of allowed unsecured claims to be paid in full. Class 20 consists of the Disputed Claim of Amy Stanley. In the event the Court determines that Amy Stanley is entitled to an allowed unsecured claim for the $1,204,836.00 in funds utilized by the Debtors with the respect to the properties, the Debtors will transfer the following properties to Ms. Stanley subject to any liens claims and interests in full satisfaction of her claims on the Effective Date of the Plan: * The 828 Burch Drive Property. The Debtor estimates that the fair market value of the 828 Burch Drive Property is at least $364,000.00. There are approximately $ 7,920.00 in liens, for a net value of ($356,080) * The 1342 9th Ave Property. The Debtor estimates that the fair market value of the 1342 9th Ave Property is $245,000. There are approximately $5,724.51 in liens on the 1342 9th Ave Property, for a net value of $239,275.49 * The 944 Market Street Property. The Debtor estimates that the fair market value of the 944 Market Street Property is $320,000.00. There are approximately $6,611.68 in liens on the property, for a net value of $313,388.32. * The 748 MLK Blvd. Property. The Debtor estimates that the fair market value of the 748 MLK Blvd. Property is $335,000.00. There are approximately $4,125.27 in liens on the property, for a net value of $320,874.73. The Debtors intend to sell the 5329 W. Atlantic Blvd. Property and the 2324 S. Congress Property to fund the initial distributions to administrative expenses claims, priority claims, if any, and allowed unsecured claims. In the event that Amy Stanley is determined to have an allowed claim, in addition to selling the 5329 W. Atlantic Avenue Property and the 2324 S. Congress Property, the Debtor will transfer the 4 properties to Amy Stanley on the Effective Date of the Plan. A full-text copy of the Fourth Amended Plan dated July 7, 2022, is available at https://bit.ly/3IrAGOk from PacerMonitor.com at no charge. Attorney for Debtors: Laudy Luna, Esq. Cuneo, Reyes & Luna, LLC 2655 S. Le jeune Rd., Suite 804 Coral Gables, FL 33134 Tel: (786) 332-6787 Fax: (786) 204-0687 Email: ll@crllawgroup.com About Basa Investments Basa Investments, LLC, is the owner of two real properties and a commercial property in Florida, having a total current value of $1.07 million. The company is based in Lake Worth, Fla. Basa Investments sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No. 22-10741) on Jan. 31, 2022, listing $1.07 million in assets and $1.50 million in liabilities. Ariel Banegas, managing member, signed the petition. Judge Erik P. Kimball oversees the case. Laudy Luna, Esq., at Cuneo, Reyes & Luna, LLC, serves as the Debtor's legal counsel. BETTER 4 YOU BREAKFAST: Wins Cash Collateral Access Thru July 15 ---------------------------------------------------------------- The U.S. Bankruptcy Court for the Central District of California, Los Angeles Division, approved the Seventh Extension Stipulation between Better 4 You Breakfast, Inc. and Valley National Bank, successor by merger to Bank Leumi USA, authorizing the Debtor to use cash collateral on an interim basis through July 15, 2022, in the amounts and at the times specified in, and strictly in compliance with, the revised budget. The Debtor requires the use of cash collateral to continue operations and administer and preserve the value of its estate until the anticipated sale of the Debtor's business. The Court said all other terms and conditions set forth in the previous Interim Orders are expressly reaffirmed and will continue in full force and effect and Valley National will continue to be entitled to all of the same rights, liens, priorities and protections provided for under the Interim Orders and Loan Documents. The terms and provisions of the Order will be valid and binding upon Debtor, all creditors of Debtor and all other parties-in-interest from and after the date of the entry of the Order by the Court, will continue in full force and effect, and will survive entry of any such other order, including without limitation, any order converting one or more of the Cases to any other chapter under the Bankruptcy Code, or dismissing one or more of the Cases. A copy of the order and the Debtor's budget is available at https://bit.ly/3yYF447 from PacerMonitor.com. The Debtor projects $1,872,000 in total receipts and $970,000 in total disbursements for the week ending July 10, 2022 and $904,000 in total receipts and $655,000 in total disbursements for the week ending July 17. About Better 4 You Breakfast Better 4 You Breakfast, Inc. is a school meal vendor based in Los Angeles, Calif. Better 4 You Breakfast sought protection under Chapter 11 of the Bankruptcy Code (Bankr. C.D. Calif. Case No. 22-10994) on Feb. 24, 2022, listing as much as $50 million in both assets and liabilities. Fernando Castillo, president, signed the petition. Judge Sheri Bluebond oversees the case. Daniel A. Tilem, Esq., at the Law Offices of David A. Tilem and James Wong, a principal at Armory Consulting Co., serve as the Debtor's legal counsel and chief restructuring officer, respectively. The U.S. Trustee for Region 16 appointed an official committee of unsecured creditors on April 18, 2022. The committee is represented by Brinkman Law Group, PC. BIOLASE INC: Amends Credit Agreement With SWK Funding ----------------------------------------------------- Biolase, Inc. entered into an amendment to its senior secured term loan with SWK Funding LLC. The amendment extends the interest-only period of the loan by two quarters to November 2023 and reduces the minimum Consolidated Unencumbered Liquid Assets from $7,500,000 to $5,500,00. BIOLASE used a portion of the proceeds from its recent equity offering to prepay $1,000,000 of the outstanding loan balance. "The recent equity offering allowed us to prepay a portion of our senior secured term loan," commented John Beaver, president and chief executive officer of BIOLASE. "This prepayment and amendment will result in lower interest expense while also increasing the Company's liquidity." "Biolase continues to bring leading dental laser solutions to dentists and patients. SWK remains a supportive partner of the company and its mission," commented Winston Black, chief executive officer of SWK Holdings. SWK Funding LLC is a subsidiary of SWK Holdings Corporation, a Dallas, Texas-based healthcare focused investment firm. About Biolase BIOLASE -- http://www.biolase.com-- is a medical device company that develops, manufactures, markets, and sells laser systems for the dentistry and medicine industries. BIOLASE's proprietary laser products incorporate approximately 301 patented and 32 patent-pending technologies designed to provide biologically and clinically superior performance with less pain and faster recovery times. Biolase reported a net loss of $16.16 million for the year ended Dec. 31, 2021, a net loss of $16.83 million for the year ended Dec. 31, 2020, a net loss of $17.85 million for the year ended Dec. 31, 2019, and a net loss of $21.52 million for the year ended Dec. 31, 2018. As of March 31, 2022, the Company had $50.24 million in total assets, $29.64 million in total liabilities, and $20.60 million in total stockholders' equity. BROOKFIELD RESIDENTIAL: S&P Affirms 'B' ICR, Alters Outlook to Neg. ------------------------------------------------------------------- S&P Global Ratings revised its outlook to negative from stable and affirmed its 'B' issuer credit rating on Canada-based Brookfield Residential Properties Inc. At the same time, S&P affirmed its 'B+' issue-level rating on the company's senior unsecured notes. S&P's recovery rating remains '2'. S&P's negative outlook reflects the continuation of Brookfield's smaller size and weaker profitability compared to peers, even as debt to EBITDA improves to 6x and payouts to its parent moderate from sharply higher recent levels. Brookfield has the industry's highest cost structure. Despite significant contribution from highly profitable land sales, the company's overall housing adjusted gross margin, expected to peak above 23% in 2022 and 2023, is only slightly below peer averages. However, selling, general, and administrative (SG&A) costs, though now trending in the low teens (%), remain more than three percentage points above the average. The builder's significant ownership of long-lived Canadian land is a considerable drag on returns. Heading into 2022, the company controlled almost 77,500 homesites. Even if we exclude some 30,000 lots likely ear-marked for outright sale, still suggests a 15-year lot supply, whereas no single peer has more than nine years of lots. As a result of its asset-heavy approach, where much of the land is undeveloped Canadian property with no visible revenues, overall inventories turn over only about once every two years, compared to about a year or less for most builders. As a result, Brookfield Residential Properties inc. (BRPI) has the industry's lowest returns on capital, by far. Operating cash flows are increasingly difficult to predict. Given visibility from its backlog of homes on order, S&P can predict with reasonable accuracy Brookfield's 2022 EBITDA, at nearly $350 million. However, much less predictable are cash flows to and from: -- Inventories--BRPI plans to rebuild its community count from multiyear lows, even as unit volumes (orders and deliveries) declined sharply to start 2022. Already slow build times are further delayed by labor and supply chain constraints. -- Land sales--with net margins about double those of homes', the timing and size of these profits is largely unknown from these key contributors to operating cash flows. -- Mixed-use projects--The company only recently put the larger (5th and Broadway) of its two long-lived projects up for sale, but S&P thinks proceeds from it and next year's planned divestiture (Lilia) will easily exceed its costs (including debt repayment). After 2023 though, S&P expects no further windfalls from mixed-use and reduced investments into these noncore assets. -- Payments to parent Brookfield Asset Management (BAM)—S&P mostly expected the $470 million in 2021 distributions made to its parent. But coupled with the unexpected $375 million, debt-financed distribution made to start 2022, it is now re-assessing what "normalized" amounts will be. S&P's current forecasts of $120 million per year suggest these outlays moderate toward pre-2021 levels. As the cycle matures, BRPI's lack of full control over its own cash flows and strategy could further hamper its credit profile. S&P said, "Although EBITDA appear likely to remain around cyclical-peak levels through 2023, we have less visibility into the uses of these cash flows. With its earliest notes not maturing until 2027, we expect the company to grow its cash balances even as we note restructuring, acquisition, and other strategic activity amid recent economic tailwinds, are more likely to accelerate as the cycle matures. "Our negative outlook reflects the continuation of Brookfield's size and profitability losing ground to peers, even as debt to EBITDA declines to 6x and payouts to its parent moderate." S&P could lower BRPI's rating to 'B-' if one of these factors were to occur: -- Debt to EBITDA rises back above 8x, due to cash flows from housing operations and mixed-use projects falling well short of our expectations in 2022, or large distributions to its parent Brookfield Asset Management Inc. (BAM) continue. -- Size and scale continue to underperform peers, and returns on capital fail to meet its debt costs (5%-6%). -- S&P's view of its strategic importance to BAM were to materially diminish such that it would reassess its group status. S&P could revise its outlook on BRPI to stable if it sustains leverage comfortably below 8x, while sharply reducing annual distributions to its parent, and sustainably cutting its cost structure. ESG credit indicators: E-3; S-2; G-2 S&P said, "Environmental factors are a moderately negative consideration in our credit rating analysis of Brookfield Residential Properties. The company is subject to a variety of local, state, and federal statutes, ordinances, rules and regulations concerning health and environment protection. We view Brookfield's ESG exposure as broadly in line with that of industry peers." BURTS CONSTRUCTION: Taps Daniel Lazo as Real Estate Agent --------------------------------------------------------- Burts Construction, Inc. seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to hire Daniel Lazo, a real estate agent at Lazo Realty. The Debtor requires a real estate agent to value and market for sale its property in Harris County, Texas. If Mr. Lazo is the selling agent and also the buyer's agent, he will be entitled to a commission of 6 percent. If the buyer has a separate agent, each agent will be entitled to a commission of 3 percent. As disclosed in court filings, Lazo Realty does not have any connections with the Debtor, creditors or any other party in interest. The firm can be reached through: Daniel Lazo Lazo Realty 20008 Champion Forest Dr, Suite 201 Spring, TX 77379 Phone: +1 832-559-3975 About Burts Construction Burts Construction, Inc -- https://www.burtsconstruction.com/ -- is a family-owned and operated commercial site work company located in Tomball, Texas. Some of its services include land clearing, demolition, site preparation, soil stabilization, underground utilities, and paving. Burts Construction sought protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Texas Case No. 22-31700) on June 20, 2022, listing up to $500,000 in assets and up to $10 million in liabilities. Katherine Burts, president of Burts Construction, signed the petition. Judge Christopher M. Lopez oversees the case. Julie M. Koenig, Esq., at Cooper & Scully, P.C. is the Debtor's legal counsel. CENSO LLC: Returns to Chapter 11 Bankruptcy ------------------------------------------- Censo LLC has returned to Chapter 11 bankruptcy. In the new filing, the Debtor disclosed $1.015 million in assets against $700,000 in liabilities in its schedules. The Debtor owns a single family residence at 5900 Negril, Las Vegas, valued at $363,000; a single family residence at 1161 Dana Maple Court, Las Vegas, valued at $280,000; and a third property at 11441 Allerton Park Dr., #411, Las Vegas, valued at $369,000. According to court filings, Censo LLC estimates between 1 and 49 creditors. The petition states funds will be available to unsecured creditors. About Censo LLC Censo LLC previously sought Chapter 11 bankruptcy protection (Bankr. D. Nev. Case No. 19-16636)) on Oct. 11, 2019. Censo LLC again sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Nev. Case No. 22-12369) on July 7, 2022. In the petition filed by Melani Schulte, as managing member, the Debtor reports estimated assets between $1 million and $10 million and estimated liabilities between $500,000 and $1 million. MICHAEL J. HARKER, of the Law Offices of Michael J. Harker, is the Debtor's counsel. CLEARDAY INC: Secures $540K Loan; Maturity Date Extended -------------------------------------------------------- Clearday, Inc. entered into a loan agreement with an institutional lender to obtain gross proceeds of approximately $540,000 and modified an existing promissory note to reduce its principal balance from approximately $2,420,000 to $550,000 (which eliminated approximately $1,870,000 or the Company's indebtedness) and extended the note's maturity date to March 31, 2023. Financing On July 5, 2022, the Company closed a loan with an institutional lender under the terms of a Securities Purchase Agreement dated July 1, 2022, and issued an unsecured promissory note in the principal amount of $600,000, which included original issue discount of $60,000 to the Lender. The Note provided proceeds to the Company $540,000 before fees and expenses. The Company paid $54,000 in placement fees in connection with the sale of the Note and $7,000 of expenses of the Lender. After payment of such fees and closing cost, the sale of the Note resulted in $479,000 in net proceeds to the the Company. The Note was issued in a transaction that is exempt from the registration requirements of the Securities Act of 1933, as amended, under Section 4(a)(2) thereof. The net proceeds were used for general working purposes. The obligations under the Note incur interest equal to 12% per annum, subject to increase to the lesser of 16% per annum or the maximum amount permitted by law upon an Event of Default as defined by the Note. The Note's maturity date is 380 days after the July 5 funding date of the Note. Interest and principal are payable from and after 90 calendar days after the funding date, subject to a five business day grace period, in equal monthly payments of $60,000 plus accrued and unpaid interest, subject to our right to extend any or each of the first three such payments for 30 days upon payment of a fee equal to 10% of the amount due on such payment date. The Company may prepay the obligations under the Note upon notice of seven trading days without payment or penalties or fees other than a $750 administrative fee. The Company paid the Lender a commitment fee of the Company's common stock. 66,000 of Commitment Shares were issued and vested on the funding date of the Note. An additional 300,000 Commitment Shares vest at a rate of 30,000 shares per month. The Note ranks as the Company's senior unsecured debt. No security interests were granted to the Lender. The Lender has certain rights that may be exercised only upon an Event of Default (as defined by the Note). These rights include the right to exercise a warrant to purchase 900,000 shares of the Company's common stock at a price per share of $0.50, which Warrant will be void cancelled when the Note is repaid in full, if there has not been an Event of Default. The Lender also has the right to convert the obligations under the Note, from and after an Event of Default, at a price per share equal to $0.50. Each of the exercise price of the Warrant and the conversion price of the Note are subject to adjustment in the event we issue shares of common stock or equivalents at a price per share that is lower than the then exercise or conversion price. The Lender has no right to convert the Note or exercise the Warrant unless there is an Event of Default under the Note. The Company has agreed to reserve shares of its common stock for issuance to the Lender upon any conversion of the Note, which may be converted only after an Event of Default, equal to the product of number of shares that would be issued upon any such conversion multiplied by 1.25. The Company agreed to register under the Securities Act the Commitment Shares and the shares of common stock underlying the Warrant and the Note under the terms of a Registration Rights Agreement within 180 days after the funding date, if the Note has not been repaid prior to such date. The Company has also provided under the Securities Purchase Agreement that it will provide for such registration of such shares of its common stock in any other registration statement that it may file under the Securities Act, subject to certain customary exceptions. The Note has customary representations, warranties and covenants, including, without limitation, its indemnification of the Lender a judgement that is unvacated, unbonded or unstayed for a period of 20 days, other than certain specified matters. The Company has provided the Lender with a right of first refusal with respect to any bona fide offer of any financing that it intends to pursue that may be exercised by the Lender within five trading days after the Company provides a notice of such proposed financing. If the Lender does not exercise its right of first refusal, then the Company may close such financing within 30 days. The Lender's right of first refusal is not applicable to any of the following: (1) a bona fide offer of capital or financing from a nationally recognized broker dealer that is retained by Borrower and acceptable to the Holder, which acceptance will not be unreasonably delayed, withheld or conditioned, or any person or party that is introduced to the Company by the Investment Banker in its capacity as a placement agent, (ii) a bona fide offer of capital or financing from a person or party if such capital or financing is used by the Company for the acquisition or refinance of real property so long as (a) any security interest granted to such person or party is solely limited to the real property being acquired or refinanced and (b) such person or party shall have no rights at any time in such transaction or any related transaction to acquire Common Stock or Common Stock Equivalents of the Company, as well as (iii) a bona fide offer of capital or financing from a person or party if such person or party is solely purchasing the Company's accounts receivable(s) or sharing of the Company's revenues, in each case so long as such person or party shall have no rights at any time to acquire Common Stock or Common Stock Equivalents of the Company. The Note is subject to repayment from the use the proceeds of certain transactions. If, prior to the full repayment or satisfaction of the Note's obligations, the Company receives cash proceeds of more than $2,000,000.00 in the aggregate, from the sale of assets or issuance of our securities, including pursuant to an Equity Line of Credit (as defined in this Note), then the Lender may require the Company to apply up to 50% of such proceeds after the Minimum Threshold to repay all or any portion of the outstanding obligation under the Note; provided that such repayment obligation is not applicable to Real Property Transactions, the sale of assets to customers of the Company in the ordinary course of business, the sale of interests in real estate, or any Small Business Administration Economic Injury Disaster Loan. The Lender has "most favored nations" status. While the Note's obligations are outstanding, the Company will provide the Lender with any terms under any other public or private offering of the Company's securities (including securities convertible into shares of the Company's common stock) with any individual or entity that has the effect of establishing rights or otherwise benefiting such Other Investor in a manner more favorable in any material respect to such Other Investor than the rights and benefits established in favor of the Lender, in each case, other than with respect to any Real Property Transaction (as defined in the Note), Factoring Transaction (as defined in the Note), or Buyout Transaction (as defined in the Note, generally to be when the Company uses the proceeds to repay the Note's obligations). Reduction of Existing Indebtedness The Company paid the holder of a promissory note issued on Sept. 9, 2021 $175,000 and concurrently modified the terms of such promissory note. The modifications included reducing the outstanding principal balance to $550,000, extending the maturity date of the note to March 31, 2023, eliminating the requirement to make minimum monthly payments on the note and decreasing the percentage of net proceeds from any equity or equity linked financings (including convertible debt), less any selling commissions to pay the obligations under this note. This note represents the full obligations of the Company to the holder who is a prior investment advisor other than the customary continuing obligations to indemnify this advisor under its advisory agreement. About Clearday Clearday (fka Superconductor Technologies, Inc.) is an innovative non-acute longevity health care services company with a modern, hopeful vision for making high quality care options more accessible, affordable, and empowering for older Americans and those who love and care for them. Clearday has decade-longexperience in non-acute longevity care through its subsidiary Memory Care America, which operates highly rated residential memory care communities in four U.S. states. Clearday at Home -- its digital service -- brings Clearday to the intersection oftelehealth, Software-as-a-Service (SaaS), and subscription-based content. Clearday reported a net loss of $19.51 million for the year ended Dec. 31, 2021, compared to a net loss of $13.78 million for the year ended Dec. 31, 2020. As of March 31, 2022, the Company had $46.14 million in total assets, $69.55 million in total liabilities, $18.48 million in temporary equity, and a total deficit of $41.89 million. Dallas, Texas-based Turner, Stone & Company, LLP, the Company's auditor since 2022, issued a "going concern" qualification in its report dated April 15, 2022, citing that the Company has suffered recurring losses from operations and has insufficient working capital to fund future operations both of which raise substantial doubt about its ability to continue as a going concern. CYPRESS CREEK: Amends Frost Bank Secured Claim Pay Details ---------------------------------------------------------- Cypress Creek Emergency Medical Services Association submitted a Chapter 11 Plan of Liquidation under Subchapter V, as Modified, dated July 7, 2022. On July 1, 2022, the Debtor filed its Emergency Motion for Approval of Asset Purchase Agreement for Sale of Certain Personal Property for $1 million Free and Clear of Liens, Claims and Encumbrances (the "Sale Motion"). If (a) the Sale Motion is approved by the Bankruptcy Court and (b) a lease or executory contract is listed, then under this Plan such lease or executory contract shall be assumed and assigned to the buyer named in the Sale Motion. As to the leases or executory contracts listed, but only if the Court approves the Sale Motion, the Plan constitutes a motion to assume such leases and executory contracts and further to assign such leases and contracts to the buyer under the THHF APA. If the Bankruptcy Court does not approve the Sale Motion, then the Debtor shall reject all the executory contracts and unexpired leases. Class 3 consists of Frost Bank as a Secured Creditor. By the expiration of 12-months immediately the Effective Date, Frost Bank shall be paid in full from the proceeds of the sale of the real estate that secures its claim. Debtor anticipates no deficiency claim. If there is an Allowed deficiency claim, then the Allowed deficiency claim will be treated as a Class 10 claim. On the Effective Date of the Plan, Debtor shall pay Frost Bank an installment equal to one month's interest (calculated at the contractual non-default rate), and continue such monthly payments of interest (calculated at the contractual non-default rate) on each of the next following months until such time as Frost Bank has been paid in full from the proceeds of the sale of the real estate that secures its claim. Like in the prior iteration of the Plan, holders of Allowed Class 10 General Unsecured Claims shall receive pro rata share of distributions of the remaining Net Distributable Cash, after payment in full of Allowed Classes 1 through 9, until the earlier of (i) when the Allowed Class 10 Claims are paid in full, without interest, or (ii) the Net Distributable Cash is fully depleted. Class 10 is impaired. The source of funds to achieve consummation of and carry out the Plan shall be (i) Proceeds from the liquidation of substantially all of Debtor's real and personal property, including, but not limited to, if it closes, liquidation by way of the THHF APA; (ii) Debtor's Cash; (iii) collection accounts receivable and bad debt owed to Debtor, including for any service provided on or before April 19, 2022, and (iv) recoveries, if any, from pursuit of Reserved Litigation Claims. A liquidating trust shall be created pursuant to a Liquidating Trust Agreement. The Liquidating Trust shall be governed by the Liquidating Trust Agreement, the Plan, and the Confirmation Order. The terms of the employment of the Liquidating Trustee shall be set forth in the Liquidating Trust Agreement or the Confirmation Order. Except as otherwise provided herein, Debtor shall transfer all remaining rights and assets (not including non transferable licenses and certifications), including Cash, Remaining Assets (including for the removal of doubt, insurance policies), Reserved Litigation Claims, and any Disputed Claims Reserve, to be administered by the Liquidating Trustee, subject to the terms and conditions of this Plan. A full-text copy of the Modified Liquidating Plan dated July 7, 2022, is available at https://bit.ly/3nQVwx9 from PacerMonitor.com at no charge. Attorneys for Debtor: Annie E. Catmull, Esq. O'ConnorWechsler PLLC 4400 Post Oak Plaza, Suite 2360 Houston, TX 77027 Tel: (281) 814-5977 Email: aecatmull@o-w-law.com About Cypress Creek Cypress Creek Emergency Medical Services Association is an emergency medical service provider based in Spring, Texas. Cypress Creek filed a petition for Chapter 11 protection (Bankr. S.D. Tex. Case No. 21-33733) on Nov. 18, 2021, listing as much as $10 million in both assets and liabilities. Wren Nealy, Jr., chief executive officer, signed the petition. Judge Christopher M. Lopez oversees the case. The Debtor tapped Annie Catmull, Esq., at O'ConnorWesler, PLLC as legal counsel and J. Patrick Magill of Magill, PC as chief restructuring officer. DR. R'KIONE BRITTON: Taps Scott Christansen as Bookkeeper --------------------------------------------------------- Dr. R'Kione Britton Chiropractic Corporation seeks approval from the U.S. Bankruptcy Court for the Central District of California to employ Scott Christansen, a principal at AAdvanced Business Systems, to provide bookkeeping services. Mr. Christansen's services include: a. preparing a 90-day and 180-day projected profit and loss statements; b. assisting the Debtor in the preparation of monthly operating reports; c. maintaining the Debtor's books and records during the pendency of its Chapter 11 case; d. reviewing the books and records of West LA Medical, Inc. in order to determine if it owes money to the Debtor; e. providing information, which the Debtor's legal counsel may require to amend the Debtor's bankruptcy petition; f. assisting in the preparation of the liquidation analysis; g. providing advice on how to make the business more efficient; h. assisting the Debtor's counsel in preparing and seeking confirmation of a plan of reorganization; and i. providing information needed by the Debtor's accountant to complete its work. Mr. Christansen will charge $60 per hour for his services. In court papers, Mr. Christansen disclosed 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 through: Scott Christansen AAdvanced Business Systems Mission Viejo, CA 92692 Phone: (949) 981-0746 Email: aadvansys@yahoo.com About Dr. R'Kione Britton Chiropractic Corp. Dr. R'Kione Britton Chiropractic Corporation is a Los Angeles-based 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 sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Calif. Case No. 22-13004) on May 31, 2022. In the petition signed by Dr. R'Kione Britton, president, the Debtor disclosed $226,317 in assets and $1,308,118 in liabilities. Judge Deborah J. Saltzman oversees the case. The Debtor tapped Steven E. Cowen, Esq., at S.E. Cowen Law as legal counsel and Scott Christansen, a principal at AAdvanced Business Systems, as bookkeeper. EASCO BOILER: Seeks Cash Collateral Access ------------------------------------------ Easco Boiler Corp. asks the U.S. Bankruptcy Court for the Southern District of New York for authority to use cash collateral and provide adequate protection. The Debtor requires the use of cash collateral to preserve the going concern value of Easco and its assets until a sale of those assets can be completed or a plan of reorganization can be confirmed. As detailed in the Budget, Easco has an immediate need for the use of cash collateral so that it may pay its personnel and contractors performing the services needed to maintain the value of the assets of Easco and its affiliated debtor, Leggett Real Estate Holdings, LLC prior to the anticipated sales and confirmation of their plans of liquidation and/or reorganization. In order to preserve that value for the benefit of the Debtors' creditors and their bankruptcy estates, Easco needs to use cash to pay for utility services, rubbish collection, security, insurance and other expenses relating to preserving the use and value of the real estate on which Easco conducts its business. Easco is a New York Sub-Chapter S corporation with its headquarters in the Bronx, New York. It was founded in 1926 and is the oldest minority owned and operated steel boiler and tank manufacturer in the country. Hasco has expertise in specialties such as low-pressure boiler fabrication, shop-built or field-erected tanks, oil spill and tank cleaning, and installation and maintenance of temporary mobile boilers. Subject to the filing of their bankruptcy schedules, the Debtors believe Elizon DB Transfer Agent LLC, c/o Edgewood Capital Advisors LLC and 32BJ North Health Fund, et al. hold or claim to hold security interests in Easco's assets other than cash collateral. Easco is the sole member and 100% owner of Leggett and another single purpose real estate owning entity, 1173 Real Estate Holdings, LLC. Leggett is a Delaware limited liability company that owns the real property known and numbered as 1173-1175 Leggett Avenue, Bronx, New York. Leggett's only business is the management of the Leggett Property and Easco is its lone tenant. Leggett has filed a companion Chapter 11 case currently pending before the Court; Grinnell is not a debtor in bankruptcy. Arlington Leon Eastmond, Jr. is the sole shareholder of Easco. Since 2020, Eastmond has been managing both Debtors with the assistance of his grandson, Tyren Eastmond. The senior Mr. Eastmond has recently taken ill, with Tyren stepping into the roles of President of Easco and managing member of Leggett. Prior to the Petition Date, Easco conducted three primary lines of business: a. Manufacturing commercial boilers and industrial tanks; b. Servicing and repairing commercial boilers and tanks; and c. Providing temporary heating services for construction sites and other locations through use of mobile boiler units. During the last several months, the Debtors have been exploring a number of different strategies to market and sell Easco's assets and business lines, several of which are hopefully coming to fruition in the near future. Those strategies have been dependent upon Easco, Leggett, and their affiliates reaching an accord with their principal lender, Elizon DB Transfer Agent LLC reflected in the Support Agreement entered into by and between Leggett and the Lender on June 27, 2022, shortly before the bankruptcy filings. On August 22, 2021, Leggett and Easco entered into a loan arrangement with EF Edgewood SBC 2016-1 LLC evidenced by certain notes, instruments, and agreements including the Consolidated, Amended and Restated Commercial Term Promissory Note in the original principal amount of $15,000,000, dated as of August 22, 2019. The amounts due under the Note are secured by the Mortgage Consolidation, Spreader and Modification Agreement and that certain Consolidated, Amended and Restated Mortgage dated as of August 22, 2019 encumbering the Leggett Property and certain other real properties. As of October 21, 2019, the Note, Mortgage, and all other Loan Documents were assigned by the Original Lender and delivered to the Lender. Despite its longevity, Easco and its operations were already in extremis when the COVID-19 pandemic emerged in early 2020 and required a full, but temporary, shutdown of its business. Easco eventually re-opened; but it never fully recovered from the devastating financial impact of COVID. Making matters worse, the cost of material skyrocketed over the last couple of years as supply chains became problematic and posed an overwhelming challenge to recover profitable operations. In an effort to address these challenges, the amount of the loan evidenced by the Loan Documents was increased to $16,000,000 pursuant to the Consolidated, Amended and Restated Commercial Term Promissory Note dated as of April 30, 2021. Nevertheless, Easco's business operations and their related cash flow challenges continued to erode the viability of Easco's business. Easco found itself unable to pay its obligations as a tenant, which then impaired Leggett's ability to make the required payments to the Lender. During the last several weeks, Easco has reduced its business operations to continuing to provide temporary heating services for a limited number of its customers through the use of its mobile boiler units. At the same time, it is also incurring expenses relating to maintaining its equipment and other personal property, as well as the real property it occupies, so that the value of all of those assets will be preserved until such time as they can be sold. In this same period, the Debtors have undertaken efforts to market and sell their assets in an effort to provide a viable solution to their financial challenges. In this same period, the Debtors have undertaken efforts to market and sell their assets in an effort to provide a viable solution to their financial challenges. Prior to the Petition Date, an Event of Default occurred under the Loan Documents when Leggett failed to make the required payment due and owing to Lender on January 1, 2022. As a result of the Event of Default, the Lender declared the current outstanding principal balance of $16,000,000 and all other outstanding debt due under the Loan Documents to be immediately due and payable. At that point, the Lender was entitled to commence an action to foreclose the Mortgage against the Leggett Property and other properties securing its debt. Prior to the Petition Date, the Debtors and certain other parties requested that the Lender (i) forbear from exercising its rights and remedies under the Loan Documents and (ii) advance certain funds pursuant to the Loan Documents to maximize value of the Debtors' assets through a structured bankruptcy sale and plan process. As a consequence, the Debtors and the Lender (among others) entered into productive settlement negotiations that ultimately resulted in the execution of the Support Agreement and the Forbearance Agreement that is annexed to the Support Agreement. The Support Agreement is the lynchpin of the Debtors' bankruptcy cases, providing a clear path toward a confirmable plan of reorganization by liquidation of Leggett's assets, where the majority of Easco's businesses operated, with the support of Leggett's only creditor. The Support Agreement was executed prior to the Petition Date by and between Leggett and the Lender, each of which has remaining obligations to perform in an effort to optimize the bankruptcy process to maximize value. Contemporaneously with the filing of the Cash Collateral Motion, Leggett has also filed a motion seeking authority to assume the Support Agreement. As outlined in more detail in the Support Agreement, Leggett has agreed to pursue a plan consistent with the term sheet. As adequate protection, the Debtors propose the Secured Creditors be granted post-petition replacement liens and security interests against all property of Easco's bankruptcy estate (including inventory, equipment, and accounts receivable) in an amount equivalent to the amount of Cash Collateral expended by Easco but only to the extent the Secured Creditors held validly perfected liens and security interests as of the Petition Date. The Post-petition Liens will be recognized only to the extent of diminution in the value of the Secured Creditors' prepetition collateral constituting cash collateral resulting from Easco's use thereof in the operation of Easco's business in the Post-petition period. The Post-petition Liens will maintain the same priority, validity, and enforceability as the Secured Creditors' liens on Easco's pre-petition collateral. A copy of the order and the Debtor's budget is available at https://bit.ly/3awAnoR from PacerMonitor.com. The Debtors' budget provides for total disbursements before professional fees, on a weekly basis, as follows: $69,250 for the week ending July 1, 2022; $55,500 for the week ending July 8, 2022; $38,150 for the week ending July 15, 2022; $34,600 for the week ending July 22, 2022; $14,200 for the week ending July 29, 2022; $16,050 for the week ending August 5, 2022; $26,150 for the week ending August 12, 2022; and $16,500 for the week ending August 19, 2022. About Easco Boiler Founded in 1926, Easco Boiler Corp. is the oldest minority owned and operated steel boiler and tank manufacturer in the country. Easco Boiler and affiliate, Leggett Real Estate Holdings, LLC, filed petitions under Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 22-10881) on June 27, 2022. In their petitions, Easco Boiler listed up to $10 million in assets and up to $50 million in liabilities while Leggett Real Estate Holdings listed as much as $50 million in both assets and liabilities. Tyren Eastmond, president, signed the petitions. Judge James L. Garrity, Jr. oversees the cases. The Debtors tapped Riemer & Braunstein, LLP as legal counsel and ASI Advisors, LLC as financial advisor. ERNIE'S EMPIRE: 3rd Gear Restaurant Files for Chapter 7 Bankruptcy ------------------------------------------------------------------ Patrick Rehkamp of Minneapolis / St. Paul Business Journal reports that Forest Lake restaurant company, 3rd Gear Restaurant, that Ernie's Empire, which ran 3rd Gear Restaurant & Bar on the shores of Forest Lake, recently filed for Chapter 7 bankruptcy protection. The company had received more than $100,000 in Paycheck Protection Program loans through the U.S. Small Business Administration in August 2020, according to records and Eric Ernst, the restaurant's owner. The loans were forgivable with a few requirements and were essentially considered free money. Ernst opened the restaurant, which is in the city of Forest Lake, in 2019. The space was home to the former Acqua restaurant, which also has a location on White Bear Lake, according to The Forest Lake Times. The restaurant's building, which Ernst leased, is more than 7,000 square feet and had a lakeside patio. His restaurant featured a mixologist who made and designed specialty cocktails. Ernst began remodeling the restaurant in early 2019 and kept the establishment open for catering and private parties, he said. Shortly after that, the Covid-19 pandemic hit and the restaurant closed but continued to do catering, according to Ernst. Roughly March of 2021 the entire operation closed. "It was insane how much money I got into debt," Ernst said in an interview. "It was quite the place, but just extremely bad timing for really everything. … I was remodeling the place and [[Gov. Tim Walz] shut everybody down. Basically I was just screwed. I’ve been trying to rebuild myself for the last few years." The PPP loan's status is "paid in full," which includes both loans repaid and those fully forgiven from repayment under PPP guidelines, as of October 2021. In total 30 jobs were retained due to the loan, according to SBA data. Ernst also ran Ernie's Eatery & Ice Cream Parlor in Lake Forest, he said. That shop is also closed. He said the ice cream shop was run through a separate entity that was not part of bankruptcy filing. Ernst said he's left the restaurant industry, but didn't elaborate further. Chapter 7 involves liquidation of assets.Chapter 11 bankruptcy is frequently referred to as a "reorganization bankruptcy" and allows owners to reorganize and be shielded from creditors and legal claims. The company estimates it has $50,000 or less in assets and somewhere between $500,000 and $1 million in liabilities, according the filings from late June. Some of the largest unsecured creditors and their claims include: State of Minnesota's Department of Revenue (back sales taxes): $85,000 Grand Venture in Des Moines, Iowa: $400,000 Performance Food Service in Rice, Minn.: $97,000 Unsecured claims total more than $876,000, according to the court filing. About Ernie's Empire LLC Ernie's Empire is the operator of 3rd Gear Restaurant & Bar in Forest Lake. Ernie's Empire sought protection under Chapter 7 of the U.S. Bankruptcy Code (Bankr. D. Minn. Case No. 22-31013) on June 29, 2022. In its petition, the Debtor estimated assets up to $50,000 and liabilities between $500,000 and $1 million. The case is assigned to Honorable Bankruptcy Judge Michael E Ridgway. John D. Lamey, III, of Lamey Law Firm, P.A., is the Debtor's counsel. Randall L. Seaver is the Chapter 7 Trustee. FREEPORT GATE: Files Chapter 11 Subchapter V Case ------------------------------------------------- Freeport Gate LLC filed for chapter 11 protection in the Eastern District of New York. The Debtor filed as a small business debtor seeking relief under Subchapter V of Chapter 11 of the Bankruptcy Code. According to court documents, Freeport Gate estimates between 1 and 49 creditors. The petition states funds will be available to unsecured creditors. A meeting of creditors under 11 U.S.C. Section 341(a) is slated for July 27, 2022 at 2:00 PM at Room 562, 560 Federal Plaza, CI, NY. About Freeport Gate LLC Freeport Gate LLC filed a petition for relief under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-71639) on July 7, 2022. In the petition filed by Samuel Habbibian, as managing member, the Debtor reports estimated assets and liabilities between $1 million and $10 million. Gerard R. Luckman has been appointed as Subchapter V trustee. The Debtor's counsel: Robert J Spence Spence Law Office, P.C. 55 Lumber Road Suite 5 Roslyn, NY 11576 Tel: 516-336-2060 Fax: 516-605-2084 Email: rspence@spencelawpc.com FREEPORT LNG: S&P Downgrades ICR to 'B-' on Weak Liquidity ---------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on Freeport LNG Investment LLLP (FLNGI) to 'B-' from 'B' and its issue-level rating on the partnership's senior secured debt to 'B-' from 'B+'. S&P also revised its recovery rating on the senior secured debt to '3' (65%) from '2' (70%). S&P said, "The negative outlook reflects our expectation that liquidity could continue to be pressured due to limited or no distributions from FLEX Intermediate Holdco LLC (FLEX-IH), a wholly-owned subsidiary of FLNG, until operations resume with all three trains operating at nameplate capacity. "Prolonged outage puts pressure on covenants, but we anticipate that FLNGI will negotiate waivers with the lender group. With distributions as FLNGI's only source of cash, we project the debt service coverage ratio (DSCR) for 2022 will be meaningfully lower than the covenant requirement of 1.1x. Although the partnership has enough funds in its debt service reserve account (DSRA) to sustain liquidity stress for six months, without external capital contributions, the partnership would breach its financial covenant. Therefore, we expect equity cures during each quarter in which the partnership does not receive distributions. The credit agreement allows two equity cures in four consecutive quarters in case of a covenant breach, and we assume that the partnership will seek temporary waivers for equity contributions needed for any additional quarters. We assess the probability that the partnership will seek the waivers in a timely fashion as high, which is key to maintaining the current rating. We view Freeport's relationships with its core lender group as sound. That said, although unlikely at this stage, any delay or failure to seek waivers or amend the financial covenants could result in another negative rating action. "We view FLNGI's liquidity as weak and stand-alone leverage as very high. We note the project's management team expects to resume partial operations in early October 2022; however, this timing could slip, and we could revise our expectations because the facilities now require approvals from the Pipeline and Hazardous Materials Safety Administration before restarting operations. Furthermore, while the other Freeport entities rated by S&P Global Ratings are covered under a business interruption insurance plan, this insurance does not cover FLNGI. Therefore, we do not expect sources of cash will be sufficient to cover the mandatory debt service payments on the senior secured facilities over the next 12 months. In fact, we project that the partnership will experience a material deficit of funds to cover the expected debt service of $175 million. Our assessment of weak liquidity caps our rating on FLNGI at 'B-'. Under our base-case scenario, we expect distributions will resume at a normal run-rate in the second quarter of 2023. Considering our expectations of lower distributions for at least the next year, we have also revised our assessment on the partnership's stand-alone leverage to very high from negative. "The negative outlook reflects our expectation that liquidity could continue to be pressured due to limited or no distributions from FLEX-IH until operations restart with all three trains functioning at nameplate capacity and FLEX-IH resumes normal distributions to FLNGI." S&P could lower its rating on FLNGI if: -- S&P is not confident it will address its upcoming debt service payments such that the financial commitments on the loan facilities are vulnerable to nonpayment; -- It is unable to secure equity cures for each of the next few quarters when DSCR is less than 1.1x; -- It is unable to obtain a waiver from the lender group for either of the covenants regarding the DSCR of less than 1.1x or more than two equity cures in four consecutive quarters; or -- S&P views the capital structure as unsustainable over the long term. S&P could revise its outlook to stable if: -- The company addresses its upcoming debt service payments through an equity cure for not more than three quarters; and -- Normal operations restart at the facility and FLEX-IH resumes regular distributions to FLNGI. ESG credit indicators: E-3, S-2, G-2 S&P said, "Environmental factors are a moderately negative consideration in our credit rating analysis on Freeport LNG Investments LLLP, which is the controlling owner of an operator of LNG liquefaction facilities on the U.S. Gulf Coast. Climate transition risks for the midstream industry, and Freeport notably, relate to the risk that global gas demand may peak earlier than expected if renewable power generation is further accelerated by policy. However, this is offset to a certain degree by the role of natural gas in helping to balance renewables and seasonal demand." HAIL MARY: Seeks Cash Collateral Access --------------------------------------- Hail Mary, LLC asks the U.S. Bankruptcy Court for the District of Massachusetts for authority to use cash collateral and provide adequate protection. Cash collateral in the case consists of income generated from the operation of the Debtor's rental property located at 49 Red Barn Road, Nantucket MA, in the regular course of business. The Property value is $569,799 according to tax records and the professional opinion of the manager of the LLC. The Debtor's primary source of income comes from renting the property during the summer months. The Debtor's annual rental income received is approximately $209,014. The Property value is $569,799 according to tax records and the professional opinion of the manager of the LLC. The Debtor's primary source of income comes from renting the property during the summer months. The Debtor's annual rental income received is approximately $209,014. QS Private Lending, LLC is the Debtor's only secured creditor that has a validly perfected lien on the Debtor's cash collateral. The Debtor has signed a Promissory Note and Mortgage on July 20, 2021, in the amount of $1,458,000. The manager of the LLC guaranteed payment of the loan. The Debtor was unable to stay current on its obligation to QS Lending and thus a foreclosure proceeding was commenced. The use of cash collateral will fund the Debtor's ordinary course of business operations. The Debtor possesses some cash collateral in the amount of $18,500, currently being held in its debtor-possession bank account with Rockland Trust. The Debtor's income and future cash collateral will come from the operation of the Property, and will be realized only by the Debtor's continued operation of the Property. As adequate protection for the use of cash collateral, QS Lending will be granted replacement lien and security interest in the post-petition accounts receivable generated from operations of the business. The Debtor will remain within its budget, with a 10% variance. A copy of the motion is available at https://bit.ly/3Rp1anD from PacerMonitor.com. About Hail Mary LLC Hail Mary, LLC is Single Asset Real Estate. Hail Mary, LLC sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Mass. Case No. 22-10740) on May 26, 2022. In the petition signed by Patrick S. Keating, as manager, Hail Mary LLC listed estimated assets between $500,000 to $1 million and estimated liabilities up to $50,000. The case is assigned to the Honorable Chief Bankruptcy Judge Christopher J. Panos. The Law Office of Peter M. Daigle, P.C., serves as the Debtor's counsel. HAWAIIAN HOLDINGS: Appoints Two New Directors --------------------------------------------- Hawaiian Holdings, Inc., the parent company of Hawaiian Airlines, Inc., has appointed Wendy Beck and Craig Vosburg to its board of directors. The Board has also appointed Ms. Beck to serve on the Audit Committee and Mr. Vosburg to serve on the Compensation Committee. Ms. Beck has extensive finance leadership experience in the consumer and travel industries, most recently serving as executive vice president and chief financial officer at Norwegian Cruise Line Holdings Ltd. Mr. Vosburg, chief product officer at Mastercard, has specialized in driving cultural and technological transformation to develop new products and businesses. "We are delighted to welcome Wendy and Craig, who will bring invaluable expertise to our Board at a pivotal time as Hawaiian prepares to grow with a renewed focus on technology and product investments to provide even greater value to our guests," said Lawrence Hershfield, chairman of the board of Hawaiian Holdings, Inc. Prior to her tenure at Norwegian, Ms. Beck held executive positions at Domino's Pizza Inc., Whataburger Restaurants, LP, and Checkers Drive-In Restaurants. She earned a bachelor's degree of science in accounting from the University of South Florida. Mr. Vosburg, who has spent the last 16 years in various leadership roles at Mastercard, previously held management positions at Bain & Company, Inc., A. T. Kearney, Inc., and CoreStates Financial Corporation. He holds a master's degree in business administration from The Wharton School at the University of Pennsylvania, and a bachelor of science in business administration from Bucknell University. About Hawaiian Holdings Hawaiian Holdings, Inc.'s primary asset is sole ownership of all issued and outstanding shares of common stock of Hawaiian Airlines, Inc. The Company is engaged in the scheduled air transportation of passengers and cargo amongst the Hawaiian Islands (the Neighbor Island routes) and between the Hawaiian Islands and certain cities in the United States (the North America routes together with the Neighbor Island routes, the Domestic routes), and between the Hawaiian Islands and the South Pacific, Australia, New Zealand and Asia (the International routes), collectively referred to as its Scheduled Operations. Hawaiian Holdings reported a net loss of $144.77 million for the year ended Dec. 31, 2021, a net loss of $510.93 million for the year ended Dec. 31, 2020, and net income of $223.98 million for the year ended Dec. 31, 2019. As of March 31, 2022, the Company had $4.49 billion in total assets, $1.21 billion in total current liabilities, $1.67 billion in long-term debt, $1.19 billion in other liabilities and deferred credits, and $422.09 million in total shareholders' equity. HERBALIFE NUTRITION: S&P Alters Outlook to Neg., Affirms 'BB-' ICR ------------------------------------------------------------------ S&P Global Ratings revised its outlook to negative from stable and affirmed all its ratings including its 'BB-' issuer credit rating on U.S.-based Herbalife Nutrition Ltd. The negative outlook reflects the potential for a lower rating over the next few quarters if Herbalife is not able to reverse recent and expected near-term EBITDA deterioration, resulting in forecasted adjusted leverage sustained above 4x. S&P could also lower the rating if financial policy becomes more aggressive; if the company is unable to stabilize and improve performance ahead of sizable debt maturities in 2024-2025; or while unlikely, it appears the bank facility maturities will accelerate to late 2023. Herbalife's historically resilient and geographically diverse business should rebound by late 2022 and into 2023. S&P said, "Tough macroeconomic conditions and recruitment difficulties across the direct sales industry have resulted in Herbalife's S&P Global Ratings-adjusted EBITDA declining about 25% over the past six months, with an approximately 40% decline expected in the second quarter, though we recognize these results compare to record 2021 pandemic-aided performance. We expect adjusted leverage to approach our 4x downgrade trigger in 2022. In addition to supply chain headwinds and significant inflation, Herbalife points to reduced ordering and recruitment recently displayed by distributors that joined during the pandemic as the key cause of its underperformance; we believe diminishing pandemic risk in many regions and economies reopening are a factor. Notably, China, Western Europe, and the U.S. underperformed substantially during the first quarter." Sales leaders, distributors that joined before the pandemic, and preferred customers (which join simply to purchase the product and not recruit) continue to exhibit normal behavior. Herbalife expects the return to in-person events in 2022--which provide learning, collaborating, and motivation to new distributors--will act as a catalyst to drive volume and profit growth, along with price hikes above local consumer price indices to partly cover input and freight cost increases, modest restructuring initiatives, and prudent spending related to discretionary selling, general, and administrative (SG&A) expenses. Assuming the company can prevent further EBITDA deterioration, S&P expects 2023 adjusted EBITDA will be on par with pre-pandemic levels and--in combination with material debt repayment—adjusted leverage will improve to the mid- to low-3x area. S&P assumes Herbalife will prudently manage free operating cash flow (FOCF)--including scaling back share repurchases-- to manage sizable debt maturities over the next three years, though debt capital market conditions are currently unfavorable. Debt maturities over the next three years consist of: -- $550 million 2.625% convertible notes due March 15, 2024 (though $200 million may need to be repaid by Sept. 15, 2023, to prevent the start of a credit facility maturity acceleration if certain leverage thresholds are exceeded). -- Senior secured bank credit facility (with $1.1 billion principal balance borrowed as of March 31, 2022) expiring in 2025, though under certain conditions the maturity date on the revolver and term loan A could accelerate to Sept. 15, 2023, and the term loan B to Dec. 15, 2023. -- $600 million senior unsecured notes due Sept. 1, 2025 Conditions for a bank facility maturity acceleration to the second half of 2023 include i) if the convertible notes have not been paid down by $200 million, and ii) if the company is above at least one of two specified leverage ratios. S&P said, "For modelling purposes we have made the assumption that the company will proactively redeem a sufficient amount of convertible notes to avoid a bank facility maturity acceleration; we also project Herbalife will post leverage well below the specified levels required in the second half of 2023, though this will require EBITDA strengthening and/or debt repayment. Having said that, we recognize a solid EBITDA rebound in 2023 would preclude the company from having to redeem any of the convertible notes. While compliance is not required in 2022, we believe cushion under the tighter total net leverage ratio would only be around 10% at the end of the year. Regardless, Herbalife faces sizable debt maturities over the next three years." Herbalife successfully managed a similar convertible debt/accelerated bank facility maturity scenario in 2019. While its EBITDA was under only modest pressure (due to an industrywide health products regulatory crackdown in China), it nevertheless substantially reduced share repurchases, steadied performance, repaid the remaining $675 million convertible notes with cash to avoid a bank facility maturity acceleration, and reduced leverage by about 0.5x. S&P said, "We assume a similar scenario will unfold today; however, given the macroeconomic headwinds and material profit decline, in order to maintain the rating, we need to see adjusted EBITDA growth resume by the fourth quarter of 2022 with projected FOCF generation and uses in line with our forecast." The negative outlook reflects the potential for a lower rating over the next few quarters if Herbalife is not able to reverse recent and expected near-term EBITDA deterioration, resulting in forecasted adjusted leverage sustained above 4x. This could result if the company is unable to: -- Re-energize the distributor base, particularly the number and productivity of new distributors; -- Offset macroeconomic headwinds including a potential recession amid still high costs including input, transportation, and labor, as well as unfavorable currency movements; -- Fend off potentially escalating competition from numerous weight-management-focused competitors in many formats including traditional grocery stores, direct sellers, and online. S&P said, "We could also lower the rating if financial policy becomes more aggressive, especially with respect to share repurchases; if the company is unable to stabilize and improve performance ahead of sizable debt maturities in 2024-2025; or while unlikely, it appears the bank facility maturities will accelerate to late 2023. 'We could revise our outlook to stable over the next 12 months if Herbalife is able to steady and improve EBITDA in the second half of 2022 and 2023 such that forecasted adjusted leverage is sustained below 4x, in combination with prudent management of cash flows ahead of upcoming debt maturities." This could result if: -- Solid sales growth returns because of higher volumes driven by upcoming live distributor events and more coaching for newer distributors from seasoned sales leaders, which has been less frequent during the pandemic; and -- The cost environment becomes more manageable, potentially due to a modest recession which could also attract more people to Herbalife seeking to enhance their income. INDIANA WELLNESS: Case Summary & 15 Unsecured Creditors ------------------------------------------------------- Debtor: Indiana Wellness, LLC 1221 S. Creasy Lane, K3 Lafayette, IN 47905 Business Description: Indiana Wellness, LLC is primarily engaged in general out-patient care services. Chapter 11 Petition Date: July 11, 2022 Court: United States Bankruptcy Court Northern District of Indiana Case No.: 22-40176 Debtor's Counsel: David Krebs, Esq. HESTER BAKER KREBS LLC One Indiana Sq Suite 1330 Indianapolis, IN 46204 Tel: 317-833-3030 Email: dkrebs@hbkfirm.com Total Assets: $190,785 Total Liabilities: $3,710,496 The petition was signed by Julie Miranda, practive manager. A full-text copy of the petition containing, among other items, a list of the Debtor's 15 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/G7PCAGI/Indiana_Wellness_LLC__innbke-22-40176__0001.0.pdf?mcid=tGE4TAMA INNOVATIVE GLOBAL: Case Summary & 10 Unsecured Creditors -------------------------------------------------------- Debtor: Innovative Global Distributions, LLC FDBA Down Home Group, LLC 7373 E Doubletree Ranch Rd., Suite 200 Scottsdale, AZ 85258 Chapter 11 Petition Date: July 11, 2022 Court: United States Bankruptcy Court District of Arizona Case No.: 22-04498 Debtor's Counsel: Joseph G. Urtuzuastegui III, Esq. WINDSOR LAW GROUP, PLC 1237 S Val Vista Drive Mesa, AZ 85204 Tel: 480-505-7044 Fax: 480-240-5936 Email: joe@winsorlaw.com Estimated Assets: $1 million to $10 million Estimated Liabilities: $1 million to $10 million The petition was signed by Pamela J. Gorrie as member. A full-text copy of the petition containing, among other items, a list of the Debtor's 10 unsecured creditors is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/DRYGMCA/INNOVATIVE_GLOBAL_DISTRIBUTIONS__azbke-22-04498__0001.0.pdf?mcid=tGE4TAMA J.T. SHANNON: Case Summary & 20 Largest Unsecured Creditors ----------------------------------------------------------- Debtor: J.T. Shannon Lumber Company, Inc. 2200 Cole Road Horn Lake, MS 38637 Chapter 11 Petition Date: July 11, 2022 Court: United States Bankruptcy Court Northern District of Mississippi Case No.: 22-11601 Judge: Hon. Jason D. Woodard Debtor's Counsel: Toni Campbell Parker, Esq. LAW FIRM OF TONI CAMPBELL PARKER 5100 Poplar Ave., Ste. 2008 Memphis, TN 38137 Tel: 901-683-0099 Fax: 866-489-7938 Email: tparker002@att.net Estimated Assets: $10 million to $50 million Estimated Liabilities: $10 million to $50 million The petition was signed by Jack T. Shannon, Jr. as president. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/LIZ5III/JT_Shannon_Lumber_Company_Inc__msnbke-22-11601__0001.0.pdf?mcid=tGE4TAMA List of Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. Allenburg Hardwood Trade Debt $61,388 Lumber Co. 10220 Main St. Altenburg, MO 63732 2. Batte & Hollingsworth Trade Debt $71,215 19064 Highway 80 East Forest, MS 39074 3. C & S Timber Products Trade Debt $137,451 194 Gilmer Road Pontotoc, MS 38863 4. D & B Hardwood, LLC Trade Debt $186,372 P.O. Box 864 Racine, MO 64858 5. D & T Sawmill Trade Debt $147,206 P.O. Box 777 Grand Junction, TN 38039 6. Elof Hansson Trade Debt $50,761 P.O. Box 347229 Pittsburgh, PA 15251-4229 7. Entergy Utilities $40,085 P.O. Box 8105 Baton Rouge, LA 70891-8105 8. Frank Miller Lumber Trade Debt $38,696 Co., Inc. P.O. Box 1627 Indianapolis, IN 46206-1627 9. Garnica Plywood Trade Debt $69,638 16007 Loqrono Spain 10. General Millworks, Buildings & $3,212,563 LLC Improvements c/o Maynard Cooper Evan Parrott 11 N. Water St., Ste. 24290 Mobile, AL 36602 11. H.B. Fuller Trade Debt $26,124 Attn: Erica Baumann P.O. Box 64683 Saint Paul, MN 55164-0683 12. Hardwoods Trade Debt $55,019 Speciality Products U.S., LP 2700 Lind Ave., S.W. Renton, WA 98057 13. Hogan Motor Leasing Debt $96,900 Leasing, Inc. 2150 Schuetz Road, Suite 210 14. Hudson Insurance Company Breach of $95,000 Attn: Chris Morkan, Contract Claim Claim Director 100 William St., Ste. 5 New York, NY 10038 15. Milton Lumber Co. Trade Debt $124,128 443 Leatherwood Road Dover, TN 37058 16. Moore Advance Trade Debt $90,542 Staffing, LLC c/o Carter Funding P.O. Box 770416 Memphis, TN 38177 17. NCM Millworks Trade Debt $153,641 8674 Leapwood Enville Adamsville, TN 38310 18. Resource Trade Debt $167,518 Employment Solutions 5900 Lake Elleanor Dr., Ste. 100 Orlando, FL 32809 19. Taylor Lumber Trade Debt $125,136 Company, Inc. P.O. Box 641047 Dallas, TX 75264-1047 20. Whitehead Oil Co., Inc. Trade Debt $103,915 P.O. Box 13343 Memphis, TN 38113 JEFFERSON CAPITAL: Fitch Affirms LT IDR at 'BB-'; Outlook Stable ---------------------------------------------------------------- Fitch Ratings has affirmed the Long-Term Issuer Default Rating (IDR) and senior unsecured debt ratings of Jefferson Capital Holdings, LLC (Jefferson) at 'BB-'. The Rating Outlook is Stable. These rating actions are being taken in conjunction with a debt purchaser and servicer sector review conducted today by Fitch, covering eight publicly rated in Europe and North America. KEY RATING DRIVERS IDRS AND SENIOR DEBT Jefferson's rating affirmation reflects its growing franchise within the debt purchasing sector, where it benefits from a recognized market position in the U.S., a leading franchise in Canada and a presence in the UK; its diversification across secured and unsecured asset classes and business lines; and consistent operating history through predecessor entities over several business cycles. The ratings also reflect Jefferson's conservative leverage profile and limited near-term refinancing risk. Ratings are constrained by its limited scale, monoline business model primarily servicing charged off debt, and history of business acquisitions, which presents execution risks. Additional constraints include potential regulatory scrutiny associated with the consumer collections businesses, the company's reliance on internal modelling for portfolio valuations and associated metrics such as estimated remaining collections (ERCs) and its private equity ownership, which can yield uncertainty around strategic and financial targets. In 1Q22, Jefferson reported pre-tax income of $39 million, up significantly yoy despite declining cash collections which were down 13% yoy on a consolidated basis, as Jefferson recognized a bigger component of collections as income. Cash collections were resilient during 2021, up 18% from 2020, despite ERC declining 5% during that period, but have been moderating recently driven by the expiry of stimulus, forbearance, and other supportive measures that benefitted consumer liquidity post the pandemic. Reported adjusted EBITDA was $324 million for the TTM ended 1Q22; down modestly from reported FY21 adjusted EBITDA. The adjusted EBITDA margin as a proportion of revenues (gross of portfolio amortization) was strong at 71%, for the TTM period. Fitch believes earnings and the margin could be pressured as a result of the ongoing normalization of collections; however, current profitability is strong relative to 'bb' category benchmark ranges. Fitch's primary leverage metric for debt purchasers is gross debt-to-adjusted EBITDA (including adjustments for portfolio amortization), consistent with the business model's asset-based cash-generation characteristics. Jefferson's debt-to-adjusted EBITDA ratio was 1.2x on a TTM 1Q22 basis, and has been improving over the past few years. The company has a stated target to manage this ratio at-or-below 2.5x, which is comparable to larger peers and consistent with 'bb' category benchmarks. Fitch also considers debt-to-tangible equity as a complimentary leverage metric, which was 3.0x at 1Q22 and has been between 4.0x-5.0x in recent years. The tangible equity position is viewed favorably by Fitch, particularly given weaker balance sheet capitalization at some peers. Fitch notes that leverage could increase temporarily if substantial portfolio acquisition opportunities materialize in 2022; however, under Fitch's base and stress case expectations, leverage is expected to remain within targeted range. Following its inaugural $300 million unsecured notes issuance, Jefferson's percentage of unsecured debt increased to 78% of total debt, representing a substantial shift from the company's fully secured funding profile. The company is targeting an unsecured funding mix in the 40%-50% range long term, which, compares favorably with peers. The remaining funding includes a secured revolving credit facility (RCF), which is subject to borrowing base calculations based on ERCs and secured non-recourse warehouse facilities. Jefferson has no material near-term refinancing requirements. Liquidity consists primarily of balance sheet cash, which amounted to $31.6 million at end-1Q22, and existing headroom on the RCF, subject to borrowing base calculations. Debt purchasers have the option, over shorter periods, to moderate their rate of investment in new NPLs and therefore conserve liquidity. Jefferson operates in regulated markets with a high level of scrutiny on consumer disclosures, collection practices, and data privacy. In the U.S., the CFPB has recently instituted new rules that aims to govern collection and disclosure practices of the debt collectors and enforce those standards. These have contributed to a higher ESG relevance score for customer welfare - fair messaging, privacy & data security. The Stable Outlook reflects Fitch's view that the company's conservative leverage, good profitability and discretionary nature of portfolio purchases mitigate risks of any potential slowdown in debt-collection activities and/or changes to estimated recoveries. The Stable Outlook also assumes that any possible changes to Jefferson's collection practices arising from new regulatory rules will have minimal negative impact on the business model. The rating on Jefferson's senior unsecured debt is equalized with the Long-Term IDR, reflecting Fitch's expectation of average recovery prospects in a stressed scenario. The negative impact from an increase in secured funding in a priority position is offset by lower overall leverage levels. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: IDRS AND SENIOR DEBT -- Failure to maintain a diverse funding profile and/or a shift to a largely secured balance sheet funding model; -- A sustained reduction in earnings generation, particularly if it leads to a weakening in key debt service ratios or other financial efficiency metrics; -- A sustained increase in debt/adjusted EBITDA leverage ratio above 2.5x or debt to tangible equity above 5x, whether resulting from lack of EBITDA growth, an increase in acquisitions or reductions of the tangible equity base; -- A weakening in asset quality, as reflected in acquired debt portfolios significantly underperforming anticipated returns or repeated material write-downs in expected recoveries; -- An adverse operational event or significant disruption in business activities (for example arising from regulatory intervention in key markets adversely impacting collection activities), thereby undermining franchise strength and business-model resilience. Factors that could, individually or collectively, lead to positive rating action/upgrade: Upward momentum in ratings in unlikely in the short-term, but factors that could, individually or collectively, lead to positive rating action/upgrade over time include: -- An increase in scale and franchise strength relative to peers and demonstrated earning resilience through the current economic cycle; -- Further diversification of the funding profile and maintenance of an unsecured debt funding mix at greater than 40% of total debt; and -- Leverage maintained consistently below 2.0x through the cycle on a debt-to-adjusted EBITDA basis and below 4x on a debt to tangible equity basis; Jefferson's senior unsecured debt rating is primarily sensitive to changes in the group's Long-Term IDR and secondarily to the funding mix and recovery prospects on the unsecured debt. A material increase in the proportion of secured debt, from current levels, which weakens recovery prospects for unsecured debtholders in a stressed scenario could result in the unsecured debt rating being notched down below the IDR. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. ESG CONSIDERATIONS Jefferson Capital Holdings LLC has an ESG Relevance Score of '4' for Customer Welfare - Fair Messaging, Privacy & Data Security due to the importance of fair collection practices and consumer interactions and the regulatory focus on them, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. Jefferson Capital Holdings LLC has an ESG Relevance Score of '4' for Financial Transparency due to the significance of internal modelling to portfolio valuations and associated metrics such as ERCs, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. DEBT RATING PRIOR ---- ------ ----- Jefferson Capital Holdings LLC LT IDR BB- Affirmed BB- senior unsecured LT BB- Affirmed BB- JOANN INC: S&P Downgrades ICR to 'B-' on Performance Challenges --------------------------------------------------------------- S&P Global Ratings lowered its issuer credit rating on U.S.-based creative products retailer Joann Inc. to 'B-'from 'B'. The outlook is negative. At the same time, S&P lowers its issue-level rating on Joann's term loan to 'B-' from 'B'. The '3' recovery rating on this debt is unchanged. S&P said, "The negative outlook reflects the risk that we could lower our rating on Joann over the next 12 months if operating performance trends remain weak, pressuring the company's ability to generate meaningfully positive free operating cash flow (FOCF) and reduce leverage. "The downgrade reflects our expectations that Joann's operating performance will remain pressured throughout fiscal 2023, leading to strained cash generation and weaker credit metrics. Comparable store sales declined 13% during the first quarter of fiscal 2023 (and roughly 2% on a three-year basis), as fewer customers spent less across the company's sewing, home décor, and arts and crafts categories. In our view, demand for the company's products has fallen due to inflationary pressures that have curtailed discretionary purchases. Further, with more entertainment options available to consumers, we believe Joann has struggled to keep the noncore customers it gained during the height of the pandemic. We expect S&P Global Ratings-adjusted EBITDA, which declined about 65% year-over-year, will be depressed this year due to weaker consumer demand and heightened cost pressures. While the company is deferring some of its planned store refreshes to reduce capex, we believe FOCF will be breakeven. "Higher supply chain and product costs, coupled with weaker customer demand, is pressuring profitability and leading to greater cash flow volatility this year. Joann burned $142 million of cash during the first quarter due to weak operating performance and working capital needs. We anticipate further cash burn over the next one to two quarters as the company builds its inventory position, limiting its ability to reduce leverage from elevated levels. We expect operating results will remain pressured this year as a challenging consumer environment leads to softer sales trends and inflationary pressures weigh on margins. In response to higher operating expenses, the company has been raising prices and running fewer promotions to partially offset higher product and distribution costs. However, we believe there is a risk promotional activity could accelerate if traffic trends remain weak, leading to greater margin pressure than we currently anticipate in our base-case forecast. "We forecast adjusted leverage exceeding 5x over the next two years. Strained cash flow generation has caused Joann to increase borrowings under its revolving credit facility this year. We expect draws under this facility to increase over the coming quarter as it builds seasonal inventory ahead of the holiday selling period. Coupled with forecasted earnings pressure, we expect Joann's S&P Global Ratings-adjusted leverage to approach the mid-5x area in fiscal 2023, compared to 4.3x as of January 2022, exceeding our downside threshold of 5x. Although we assume leverage will improve slightly in fiscal 2024 through modest EBITDA growth and reduced revolver borrowings, we anticipate adjusted debt to EBITDA remaining above 5x. Consequently, we have revised our financial risk profile score to highly leveraged from aggressive and reassessed the comparable ratings analysis modifier to neutral from negative. Additionally, we have revised our financial policy modifier to FS-6 from FS-5. "The negative outlook reflects the possibility of a downgrade within the next 12 months if difficult operating conditions due to supply chain disruptions, rising costs, or declining demand persist longer than we currently anticipate, challenging the company's ability to restore positive free cash flow generation. "We could lower our rating on Joann over the next 12 months if operating results are tracking below our base-case forecast, resulting in sustained earnings pressure and cash flow deficits, causing us to view the company's capital structure as unsustainable. "We could revise the outlook to stable if operating pressures subside, FOCF generation strengthens, and we expect adjusted leverage will improve to about 5x." ESG credit indicators: E-2, S-2, G-2 KAYA HOLDINGS: "Greek Kay" Gets Cannabis Installation License ------------------------------------------------------------- Kaya Holdings, Inc.'s majority owned subsidiary Kaya Farms Greece's second joint venture project "Greek Kay" has been issued its crucial Cannabis Installation License, allowing for the development of a planned Medical Cannabis Facility in Epidaurus, Greece. Greek Kaya plans to utilize the facility to cultivate and manufacture KAYS proprietary cannabis brands (CBD/THC) for distribution in the Greek, German and other EU markets as permitted by local regulations. The Greek Kaya Project is designed to include 25,000 square feet of indoor cannabis cultivation, a 15,000 square foot EU-GMP extraction and processing facility, and a 10,000 square foot EU-GMP packing area. There is ample room for expansion up to an additional 15,000 square feet on site. Management expects to reach an agreement on favorable terms to purchase the property over the coming months, subject to final negotiations and project financing. Management also noted that while they expect to conclude the deal to acquire the property, the license is transferrable to another location in Greece and therefore has intrinsic and strategic value. "This new license further demonstrates our commitment to establishing a Mediterranean (Greece/Israel) based cannabis eco-system that will serve the EU and other global markets," commented KAYS CEO Craig Frank. "We are gaining access to markets expected to rival the U.S. in size and opportunity," Frank continued, "but at a fraction of the cost required in the U.S. This will prove critical as the cannabis market expands beyond North America." About Kaya Holdings Kaya Holdings, Inc. -- http://www.kayaholdings.com-- is a vertically integrated legal marijuana enterprise that produces, distributes, and/or sells a full range of premium cannabis products including flower, oils, vape cartridges and cannabis infused confections, baked goods and beverages through a fully integrated group of subsidiaries and companies supporting highly distinctive brands. As of March 31, 2022, the Company had $1.18 million in total assets, $16.68 million in total liabilities, and a total stockholders' deficit of $15.5 million. Houston, Texas-based M&K CPAS, PLLC, the Company's auditor since 2018, issued a "going concern" qualification in its report dated April 18, 2022, citing that the Company has suffered net losses from operations and has a net capital deficiency, which raises substantial doubt about its ability to continue as a going concern. KINSEY & KINSEY: Taps Foster Legal Services as Bankruptcy Counsel ----------------------------------------------------------------- Kinsey & Kinsey, Inc. seeks approval from the U.S. Bankruptcy Court for the Northern District of Illinois to hire Foster Legal Services, PLLC to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) preparing necessary reports, orders and other legal papers; (b) ensuring the Debtor complies with all rules; (c) advising the Debtor with respect to its operations including its contractual rights and duties and other legal matters that may arise; (d) assisting the Debtor in drafting and seeking confirmation of a plan of reorganization; and (e) determining the validity and enforceability of creditors' claims, and possibly claims of the Debtor against third parties. Foster Legal Services charges $420 per hour for attorney's services and $150 per hour for paralegal services. The firm requested a retainer in the amount of $15,000. As disclosed in court filings, Foster Legal Services is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Chester H. Foster, Jr., Esq. Foster Legal Services, PLLC 16311 Byron Drive Orland Park, IL 60462 Phone: (708) 403-3800 Email: chj@fosterlegnlservices.com About Kinsey & Kinsey Kinsey & Kinsey, Inc. provides a broad range of expertise in the areas of financials, procurement, human resources, payroll, budgeting, planning, distribution and manufacturing. It is based in Glen Ellyn, Ill. Kinsey & Kinsey filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. N.D. Ill. Case No. 22-06775) on June 16, 2022, listing $851,664 in assets and $1,396,477 in liabilities. Ken Novak serves as Subchapter V trustee. Judge Carol A. Doyle oversees the case. Chester H. Foster, Jr., Esq. at Foster Legal Services, PLLC is the Debtor's counsel. LTL MANAGEMENT: Bankruptcy Judge Postpones Automatic Stay Argument ------------------------------------------------------------------ HarrisMartin reports that the bankruptcy judge overseeing LTL Management's Chapter 11 bankruptcy proceedings has deferred arguments regarding continuation of the automatic stay and preliminary injunction from a July 6 hearing to a July 26, 2022 court date, noting that the Debtor had opposed the request. Ultimately, the U.S. Bankruptcy Court for the District of New Jersey said in a July 1 online docket entry that it expects all parties to still be available for the July 6, 2022 hearing in order to "confer and discuss the Court's expectations for both the July 26 hearing and for the case going forward." About LTL Management LTL Management, LLC, is a subsidiary of Johnson & Johnson (J&J), which was formed to manage and defend thousands of talc-related claims and oversee the operations of Royalty A&M. Royalty A&M owns a portfolio of royalty revenue streams, including royalty revenue streams based on third-party sales of LACTAID, MYLANTA/MYLICON and ROGAINE products. LTL Management filed a petition for Chapter 11 protection (Bankr. W.D.N.C. Case No. 21-30589) on Oct. 14, 2021. The case was transferred to New Jersey (Bankr. D.N.J. Case No. 21-30589) on Nov. 16, 2021. The Hon. Michael B. Kaplan is the case judge. At the time of the filing, the Debtor was estimated to have $1 billion to $10 billion in both assets and liabilities. The Debtor tapped Jones Day and Rayburn Cooper & Durham, P.A., as bankruptcy counsel; King & Spalding, LLP and Shook, Hardy & Bacon LLP as special counsel; McCarter & English, LLP as litigation consultant; Bates White, LLC as financial consultant; and AlixPartners, LLP as restructuring advisor. Epiq Corporate Restructuring, LLC, is the claims agent. An official committee of talc claimants was formed in the Debtor's Chapter 11 case on Nov. 9, 2021. On Dec. 24, 2021, the U.S. Trustee for Regions 3 and 9 reconstituted the talc claimants' committee and appointed two separate committees: (i) the official committee of talc claimants I, which represents ovarian cancer claimants, and (ii) the official committee of talc claimants II, which represents mesothelioma claimants. The official committee of talc claimants I tapped Genova Burns LLC, Brown Rudnick LLP, Otterbourg PC and Parkins Lee & Rubio LLP as its legal counsel. Meanwhile, the official committee of talc claimants II is represented by the law firms of Cooley LLP, Bailey Glasser LLP, Waldrep Wall Babcock & Bailey PLLC, Massey & Gail LLP, and Sherman Silverstein Kohl Rose & Podolsky P.A. About Johnson & Johnson Johnson & Johnson is an American multinational corporation founded in 1886 that develops medical devices, pharmaceuticals, and consumer packaged goods. It is the world's largest and most broadly based healthcare company. Johnson & Johnson is headquartered in New Brunswick, New Jersey, the consumer division being located in Skillman, New Jersey. The corporation includes some 250 subsidiary companies with operations in 60 countries and products sold in over 175 countries. The corporation had worldwide sales of $82.6 billion in 2020. MOUNTAIN RECOVERY: Stubblefields & Firms File Subchapter V Cases ---------------------------------------------------------------- Mountain Recovery LLC and affiliate BCQK LLC, along with their owners, Charles Carver Stubblefield and Sarah Christine Stubblefield, filed for chapter 11 protection in the District of Colorado. The Debtors each filed as a small business debtor seeking relief under Subchapter V of Chapter 11 of the Bankruptcy Code. Mountain Recovery and BCQK generally provide towing and mobile mechanic services in Colorado around the Continental Divide and west from there, including in Georgetown, Vail, Avon, Edwards, Eagle, Wolcott, and Gypsum. BCQK holds the public utility commission ("PUC") license for the towing services, while Mountain Recovery owns and/or leases the vehicles, employs drivers and mechanics, and manages all financial operations. BCQK has no assets other than the PUC license and no creditors. The Debtors filed each of their petitions as a result of civil litigation commenced on May 31, 2022, against the Debtors, among others, by plaintiffs Eagle Vail Towing, LLC, Jakhongir Berdiev, and Bakhtiyor Berdiyev (the "Plaintiffs") in the Eagle County District Court, Case No. 2022CV30099 (the "District Court Case"). In this litigation, the Plaintiffs filed a comprehensive complaint, asserting myriad claims, including for fraud, civil theft, conversion, and conspiracy. Plaintiffs likewise successfully obtained a June 5, 2022, temporary restraining order that, inter alia, prohibited Mountain Recovery from operating or possessing certain trucks. This in turn temporarily crippled Mountain Recovery's business. This TRO expired by its own terms July 5, 2022. According to court documents, Mountain Recovery estimates between 1 and 49 creditors. The petition states funds will be available to unsecured creditors. About Mountain Recovery LLC Mountain Recovery LLC -- https://mountainrecovery.com/ -- offers 24/7 Towing, Heavy-Duty Towing, Vehicle Recovery & Roadside Assistance. Serving the Vail Valley & Summit County. Mountain Recovery LLC filed a petition for relief under Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. D. Col. Case No. 22-12421) on July 6, 2022. In the petition filed by Charles Stubblefield, as managing member, the Debtor estimated assets up to $50,000 and liabilities up to $50,000. Aside from Mountain Recovery, affiliates also filed Subchapter V cases on July 6, 2022: BCQK LLC (Case No. 22-12422), and Charles Carver Stubblefield and Sarah Christine Stubblefield (Case No. 22-12432). Mr. Stubblefield owns 100% of the interests of Mountain Recovery and he operates that business as his full-time job. BCQK is owned 100% by Mrs. Stubblefield. Joli A. Lofstedt has been appointed as Subchapter V trustee. Mountain Recovery and BCQK are represented by Wadsworth Garber Warner Conrardy, P.C., while Mr. and Mrs. Stubblefield are represented by Law Offices of Kevin S. Neiman, pc. MW HEALTHCARE: Fitch Affirms 'BB' IDR, Outlook Negative ------------------------------------------------------- Fitch Ratings has affirmed the 'BB' Issuer Default Rating (IDR) applied to MW Healthcare, Inc. (Mary Wade or MW) and the 'BB' rating on approximately $46 million in revenue bonds issued by State of Connecticut Health and Educational Facilities Authority on behalf of MW. SECURITY The bonds are secured by a gross revenue pledge of the obligated group (OG), first mortgage and security interest in all assets of the OG and a debt service reserve fund. ANALYTICAL CONCLUSION The continued Negative Outlook reflects ongoing pandemic-related pressures on MW's operating and financial profiles in fiscal 2021 and through the first six months of fiscal 2022. Fitch continues to believe that MW's high exposure to skilled nursing revenues, adult day care revenues, and government payors leaves it highly susceptible to prolonged disruptions to census and revenues. In November 2022, MW completed a capital expansion project that entailed constructing a 75,000-sf building with 64 new assisted living units (ALUs) and 20 new memory care units (MCUs). The new units did not open until February 2002 due to a regulatory approval delay. At March 31, 2022, about 32% occupancy of the new units were occupied. While MW is not tested on its maximum annual debt service (MADS) until fiscal 2023, revenues from the project are needed to meet its rate covenant; therefore, any lingering challenges that limit its ability to fill units would pressure the rating, which is reflected in the Negative Outlook. Despite continued pressures, the affirmation of the 'BB' reflects MW's strong historical demand indicators and its improving liquidity position. KEY RATING DRIVERS Revenue Defensibility: 'bb' Solid Historical Demand; Very Limited Pricing Flexibility MW's long-operating history, strong local reputation, and minimal competition for certain service lines have driven strong historical demand. In fiscal 2021, occupancy averaged an adequate 89% in its residential care home units (RCHUs) and 82% in its skilled nursing facility (SNF) beds. At the six-month interim period (ending March 31, 2022), occupancy averaged 91% in its RCHUs and 89% in its SNF beds. Given its current unit mix and service offerings, a high portion of MW's revenues are derived from governmental payors, which leaves it susceptible to programmatic modifications or reimbursement changes, and severely limits the organization's pricing flexibility. Fitch notes that MW's expansion project added 84 new units (64 ALUs/20 MCUs) that are primarily private pay, which should increase pricing flexibility over time and reduce its reliance on governmental payors. As previously mentioned, the opening of the units was delayed due to a delay in regulatory approval, and occupancy was about 32% in the new units as of March 31, 2022. Fitch believes MW's strong local reputation and long-operating history should continue to support solid demand. Additionally, MW has limited competition for its RCHUs, which are primarily funded via the State of Connecticut (Older Americans Act program). Operating Risk: 'bb' Operations Pressured by Pandemic; Elevated Debt Burden MW's operating risk is assessed at 'bb' reflecting challenged operations. Due to elevated expenses related to the expansion project and pandemic disruptions, MW reported an operating ratio of 99% and a 0.8% net operating margin (NOM) in fiscal 2021. The five-year operating ratio average (FY17-FY21) was 99%, while NOM was 1.9%. These ratios declined further in the six-month interim period (ending March 31, 2022) to an operating ratio of 116% and negative 21% for NOM. Revenue only MADS coverage was 0.5x for FY21 compared to a 0.4x five-year average. MADS as a percentage of revenue was 17.7% in FY21 with a five-year average of 19%, while debt to net available was 35x in FY21. MW's resident service revenues are heavily concentrated in its SNF, which accounted for a high 82% of total fiscal 2021 revenues. Additionally, Medicaid comprised a high 65% of net SNF revenues in fiscal 2021. Fitch views MW's high concentration to SNF and reliance on a governmental payor as an asymmetric risk to MW's operating risk profile and is reflected in the 'bb' assessment. Financial Profile: 'bb' Adequate Financial Profile Despite Pandemic Pressures MW's financial profile is assessed at 'bb' reflecting its current liquidity position and the expectation for adequate debt service coverage levels following completion of its capital project. As of March 31, MW reported unrestricted cash and investments of approximately $24.8. million, which translates into 459 days cash on hand, 58.8% cash to adjusted debt, and 8.5x cushion ratio. Fitch believes MW has enough financial flexibility at its current rating level to absorb lingering pandemic pressures and improve its operating and financial profiles over the medium term, which is reflected in the affirmation of the 'BB' ratings, MW's key leverage and coverage metrics steadily improve and remain consistent with its 'bb' financial profile assessment. This assumption is based on Fitch's stress case scenario, which assumes a period of economic and operational volatility followed by a recovery. Asymmetric Additional Risk Considerations Apart from the MW's high concentration of SNF and reliance on a governmental payors as discussed in Operating Risks, no asymmetric risk considerations were relevant to the rating determination. RATING SENSITIVITIES Factors that could, individually or collectively, lead to positive rating action/upgrade: -- Maintenance of improved census to historical levels across both service lines, coupled with project filling as originally expected may result in a revision in the Outlook to Stable; -- Successful execution of its expansion project that leads to improved operations of below 95% operating ratio, greater than 13% NOM, and coverage near 2.0x, coupled with a revision in its revenue defensibility or operating risk assessments to 'bbb' could contribute to any upward rating movement. Factors that could, individually or collectively, lead to negative rating action/downgrade: -- Any significant project execution issues such as slow fill-up that negatively affect MW's operating or financial profiles or its ability to meet its rate covenant; -- Prolonged weak census levels or slow recovery of census to historical levels that results in weaker operational performance and/or deterioration in unrestricted cash reserves. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Sovereigns, Public Finance and Infrastructure issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of three notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. CREDIT PROFILE Mary Wade has a long operating history, which dates back to 1866, when it was founded to provide shelter to homeless and needy young women and children. At the beginning of the 20th century, MW's services shifted to focus more on elderly care. Today, MW's operations primarily consist of a 45-bed residential care home, a 94-bed SNF (with 20 beds dedicated to short-term rehab), and an adult day care center. All three services are provided by The Mary Wade Home (MWH). MWH, along with MW Healthcare, the parent company of MWH and all affiliated entities, and Mary Wade Residence, the company created to operate its new ALU/MCU facility, comprise the OG. Mary Wade's other affiliated entities are all located outside the OG and consist of MWH Holding, Fair Haven Properties, and Mary Wade at Home. Both MWH Holding and Fair Haven Properties were established to acquire and own properties, while Mary Wade at Home was established to provide companion and personal assistance, but hasn't been operational since 2018. Fitch analysis is based upon consolidated financial statements. In fiscal 2021 Total operating revenues of MW were $15.8 million. Asymmetric Additional Risk Considerations No asymmetric risk factors were applied in this rating determination. Debt Profile The $46 million in series 2019 bonds remains MW's only outstanding long-term debt. The bonds are fixed-rate, have a MADS of approximately $2.9 million, and a final maturity of 2054. MW has no exposure to derivative instruments, a pension liability, or a future service obligation. Sources of Information In addition to the sources of information identified in Fitch's applicable criteria specified below, this action was informed by information from Lumesis. ESG CONSIDERATIONS Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. DEBT RATING PRIOR ---- ------ ----- MW Healthcare, Inc. LT IDR BB Affirmed BB (CT) MW Healthcare, Inc. LT BB Affirmed BB (CT) /General Revenues/1 LT NEONODE INC: Further Adjourns Annual Meeting Until July 15 ---------------------------------------------------------- Neonode Inc.'s 2022 Annual Meeting of Stockholders, which was reconvened to July 8, 2022, was called to order and again adjourned without any business being conducted due to a lack of the required quorum. The Annual Meeting will reconvene on July 15, 2022 at 3:00 p.m. local time at Neonode's principal executive office located at Karlavagen 100, 115 26 Stockholm, Sweden to provide its stockholders additional time to vote on the proposals described in the proxy statement filed with the Securities and Exchange Commission on April 26, 2022. No changes have been made in the proposals to be voted on by stockholders at the Annual Meeting. The record date for determining stockholder eligibility to vote at the Annual Meeting will remain the close of business on April 19, 2022. Proxies previously submitted will be voted at the Annual Meeting unless properly revoked, and stockholders who have already submitted a proxy or otherwise voted need not take any action. Neonode's Board of Directors unanimously recommends that stockholders vote "FOR" all proposals and encourages all stockholders who have not already voted to do so immediately. For more information or questions, please contact: Chief Financial Officer Fredrik Nihlen E-mail: fredrik.nihlen@neonode.com Chief Executive Officer Urban Forssell E-mail: urban.forssell@neonode.com About Neonode Neonode Inc. (NASDAQ:NEON) -- http://www.neonode.com-- provides advanced optical sensing solutions for contactless touch, touch, gesture control, and in-cabin monitoring. Neonode reported a net loss attributable to the company of $6.45 million for the year ended Dec. 31, 2021, a net loss attributable to the company of $5.61 million for the year ended Dec. 31, 2020, and a net loss attributable to the Company of $5.30 million for the year ended Dec. 31, 2019. ODONATA LTD: Cowlicks Japan Seeks Chapter 11 Protection ------------------------------------------------------- Odonata Ltd., d/b/a Cowlicks Japan, filed for chapter 11 protection in the Southern District of New York. The Debtor operates a Japanese-centric hair salon named "Cowlicks Japan" located at 137 West 19th Street, New York. The Debtor's Chapter 11 filing was precipitated by its inability to negotiate a new lease with its landlord, Baja 137 LLC. The Debtor's hair salon business and operating revenues significantly declined as a result of the emergency COVID-19 related public health restrictions and mandates that were imposed on hair salons and other businesses deemed non-essential. Unfortunately, the Debtor was not able to secure reasonable concessions from the landlord with regard to the Debtor's financial obligations under its lease and the landlord refused to agree to any modification of the written terms of the lease. According to court filings, Odonata Ltd. estimates between 1 and 49 creditors. The Petition states funds will be available to unsecured creditors. A meeting of creditors under 11 U.S.C. Section 341(a) is slated for Aug. 8, 2022 at 02:00 PM at Office of UST (TELECONFERENCE ONLY) - CHAPTER 11s. About Odonata Ltd. Odonata Ltd., doing business as Cowlicks Japan, is a multi-services venture company dedicated to developing a wide range of services and products through various ventures and venues. Odonata Ltd. sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 22-10946) on July 5, 2022. In the petition filed by Angel Nieves, as president, the Debtor reports estimated assets between $100,000 and $500,000 and estimated liabilities between $500,000 and $1 million. The case is assigned to Honorable Bankruptcy Judge Michael E. Wiles. Douglas J. Pick, of Pick & Zabicki LLP, is the Debtor's counsel. ONE AND ONE: Seeks to Hire Maltz Auctions as Real Estate Broker --------------------------------------------------------------- One And One Holdings, LLC seeks approval from the U.S. Bankruptcy Court for the Southern 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 422 East 161st St., Bronx, N.Y. Maltz Auctions will receive a commission of 6 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 Email: info@MaltzAuctions.com About One And One One And One Holdings, LLC owns a 10-unit residential building located at 422 East 161st St., Bronx, N.Y. One And One Holdings filed for Chapter 11 protection (Bankr. S.D.N.Y. Case No. 22-10400) on March 30, 2022, disclosing up to $10 million in both assets and liabilities. Isaac Dubov, managing member, signed the petition. Judge James L. Garrity Jr. oversees the case. Leo Fox, Esq., a New York City attorney, serves as the Debtor's bankruptcy counsel. PATH MEDICAL: Plan Hearing Delayed to July 15 --------------------------------------------- Judge Scott M. Grossman granted an expedited second motion by Path Medical, LLC and Path Medical Holding, Inc., for continuance of the confirmation hearing on their Plan. Creditors did not lodge any objections to the motion. The Plan confirmation hearing will be held on Friday, July 15, 2022 at 1:30 pm. in U.S. Courthouse, 299 E. Broward Blvd., Courtroom 308, Fort Lauderdale, FL 33301. The following extended and new deadlines apply with respect to the Plan confirmation hearing: * The deadline for filing Ballots Accepting or Rejecting Plan is extended from June 23, 2022 to July 8, 2022; * The Debtors' deadline to file the Report of Plan Proponent(s) and Confirmation Affidavit is extended from June 28, 2022 to July 13, 2022; and * The deadline for filing exhibit register and uploading any exhibits a party intends to introduce into evidence at confirmation hearing is extended from June 28, 2022 to July 13, 2022. * The deadline for supplements to Professional Fee Applications is extended to July 14, 2022. Counsel for the Debtors: Brett D. Lieberman, Esq. EDELBOIM LIEBERMAN REVAH PLLC 20200 W. Dixie Highway, Suite 905 Aventura, Florida 33180 Telephone: (305) 768-9909 Facsimile: (305) 928-1114 About Path Medical Path Medical Center Holdings, Inc., is the 100% owner and sole member of Path Medical, LLC. In addition to its ownership of Path, Holdings is an employee leasing company for Path. Path is a healthcare company with 24 clinics across the state of Florida. Path Medical, LLC, and Path Medical Center Holdings filed their voluntary petitions for Chapter 11 protection (Bankr. S.D. Fla. Lead Case No. 21-18338) on Aug. 28, 2021. Manual Fernandez, chief executive officer, signed the petitions. At the time of the filing, Path Medical listed $30,047,477 in assets and $86,494,715 in liabilities while Path Medical Center listed $220,060 in assets and $76,988,419 in liabilities. Judge Scott M. Grossman oversees the cases. Brett Lieberman, Esq., at Edelboim Lieberman Revah Oshinsky, PLLC, is the Debtor's legal counsel. The Official Committee of Unsecured Creditors tapped Greenberg Traurig, P.A., to serve as its counsel, and Province Inc. to serve as its financial advisor. PLATFORM II: Case Summary & 20 Largest Unsecured Creditors ---------------------------------------------------------- Debtor: Platform II Lawndale LLC 600 Waukegan Road, Suite 129 Northbrook, IL 60062 Business Description: Platform II is a Single Asset Real Estate (as defined in 11 U.S.C. Section 101(51B)). The Debtor owns a self storage facility located at 1470 N. Lawndale Avenue, Chicago, Illinois, valued at $10 million. Chapter 11 Petition Date: July 11, 2022 Court: United States Bankruptcy Court Northern District of Illinois Case No.: 22-07668 Judge: Hon. Deborah L. Thorne Debtor's Counsel: Gregory J. Jordan, Esq. JORDAN & ZITO LLC 350 North LaSalle Drive, Suite 1100 Chicago, IL 60650 Tel: (312) 854-7181 Email: gjordan@jz-llc.com Total Assets: $10,167,956 Total Liabilities: $12,239,153 The petition was signed by Scott Krone as manager. A full-text copy of the petition is available for free at PacerMonitor.com at: https://www.pacermonitor.com/view/WSG7TDA/Platform_II_Lawndale_LLC__ilnbke-22-07668__0001.0.pdf?mcid=tGE4TAMA List of Debtor's 20 Largest Unsecured Creditors: Entity Nature of Claim Claim Amount ------ --------------- ------------ 1. A & S Masonry Trade Debt $5,525 9315 Osceola Avenue Morton Grove, IL 60053 2. Artur Construction Inc. Trade Debt $19,150 21325 N. White Pine Rd Lake Zurich, IL 60047 3. Batavia Damp Proofing Trade Debt $5,890 P.O. Box 239 Yorkville, IL 60560 4. Chicago Metro Fire Trade Debt $40,024 Protection 820 North Addison Avenue Elmhurst, IL 60126 5. Coda Design + Deferred $1,199,087 Build, LLC Management 600 Waukegan Rd, Fees and Suite 129 Advanced Northbrook, IL 60062 6. Cook County Treasurer Real Estate $390,340 118 N. Clark St., Ste. 112 Taxes Chicago, IL 60602 7. Dortrak Trade Debt $1,750 28W580 High Lake Rd West Chicago, IL 60185 8. Greenlake Real Self Storage $281,810 Estate Fund, LLC Facility 1416 El Centro Street, Suite 200 South Pasadena, CA 91030 9. Landworks Landscaping, LLC Trade Debt $2,700 13950 West Blanchard Gurnee, IL 60031 10. Levin & Ginsburg Legal Fees $143,839 180 N. LaSalle St., Suite 3200 Chicago, IL 60601 11. Margarito Sanchez $8,500 12. Masters Drywall Trade Debt $1,000 1018 Sill Ave. Aurora, IL 60506 13. Metropolitan Fire Protection Trade Debt $19,200 175 Gordon St Elk Grove Village, IL 60007 14. Schindler Elevator Trade Debt $17,197 Company 853 N. Church Court Elmhurst, IL 60126 15. SLS Electric Trade Debt $15,000 205 Beech Drive Lake Zurich, IL 60047 16. Super Remodeling Inc. Trade Debt $6,000 3008 N. 77th Avenue Elmwood Park, IL 60707 17. Tai Plumbing LLC Trade Debt $14,320 1410 Butterfield Rd Downers Grove, IL 60515-1031 18. TK Audio Visual, LLC Trade Debt $45,822 747 Miller St. PO Box 433 Suite B Beecher, IL 60401 19. VFJ Trade Debt $9,210 6658 W. 99th St Chicago Ridge, IL 60415 20. WG Glass Trade Debt $11,950 1200 Estes Street Gurnee, IL 60031 PRA GROUP: Fitch Affirms 'BB+' LongTerm IDR, Outlook Stable ----------------------------------------------------------- Fitch Ratings has affirmed PRA Group Inc.'s (PRA) Long-Term Issuer Default Rating (IDR) and senior unsecured debt ratings at 'BB+'. The Rating Outlook is Stable. KEY RATING DRIVERS IDR AND SENIOR DEBT The rating affirmation reflects PRA's leading global franchise within the debt purchasing sector, with a dominant market position in the U.S. and a strong presence across 18 countries in Europe, the Americas and APAC; a consistent performance track record spanning several business cycles; and a conservative leverage profile. The ratings are constrained by PRA's monoline business model, primarily servicing chargedoff consumer debt, continued lack of portfolio growth opportunities, and limited contingent liquidity resources. Additional constraints include the potential for heightened regulatory scrutiny of the consumer collections businesses, especially during periods of economic stress, and a reliance on internal modelling for portfolio valuations and associated metrics, such as estimated remaining collections (ERCs), which makes comparability difficult. In 1Q22, PRA reported cash collections of $481 million which was down 13% yoy on a consolidated basis. Cash collections were resilient during 2021, up 3% from 2020, despite ERC declining 7% during that period, but have been moderating recently driven by the expiry of stimulus, forbearance, and other supportive measures that benefitted consumer credit and liquidity post the pandemic, particularly in the U.S. Reported adjusted EBITDA was $1.3 billion for the trailing 12 months (TTM) ended March 31, 2022; trending lower from fiscal year 2021. However, PRA's EBITDA margin, as a proportion of revenues (gross of portfolio amortization), remained strong at over 65% for the TTM period. Fitch believes earnings and the margin could be pressured from normalizing collection and operating costs; however, current profitability remains strong relative to the assigned rating category. Fitch's primary leverage metric for debt purchasers is gross debt-to-adjusted EBITDA (including adjustments for portfolio amortization), consistent with the business model's asset-based cash-generation characteristics. PRA's gross debt-to-adjusted EBITDA ratio was 1.9x for the TTM ended 1Q22; comparable to YE 2021. Fitch also considers debt-to-tangible equity as a complimentary leverage metric, which was 3.1x at 1Q22; up from 2.8x at 1Q21. Fitch believes PRA's tangible equity position and limited shareholder distributions are strengths compared to most peers. Leverage has been trending down since 2020 given the lack of portfolio growth opportunities, but could increase if those opportunities materialize. Fitch believes PRA has adequate flexibility to manage within its targeted leverage range of 2.5x or below on a gross debt-to-adjusted EBITDA basis. Leverage is also expected to remain within the historical range under Fitch's base and stress case expectations, which assume declines in revenue and EBITDA in 2022 due to slower recovery in purchasing and normalization of collections and operating costs as well as modest impairment charges in the stress case. PRA's long-term funding consists of secured revolving credit facilities and a term loan, which are subject to ERC linked borrowing base calculations, as well as unsecured and convertible notes. The unsecured funding mix increased to 39% of total debt as of March 31, 2022; up from 26% a year ago, which Fitch views favorably. PRA recently executed a refinancing of its European secured credit facilities in addition to adding a UK credit facility, both of which extended the maturity of the secured funding, offset somewhat by lower advancing rates. PRA has $345 million of convertible notes maturing in less than a year which it should be able to repay using available secured borrowing capacity, should capital market conditions continue to be unfavorable. Near-term liquidity is supported by cash on balance sheet of $79 million and undrawn and available revolving credit capacity of approximately $500 million at end-1Q22 proforma for the refinancing transactions. Fitch believes liquidity position is adequate as debt purchasers also have the flexibility in the short-term to moderate their rate of investment vis a vis collections and conserve liquidity. PRA operates in regulated markets with a high level of scrutiny on consumer disclosures, collection practices, data privacy etc. In the U.S., the Consumer Financial Protection Bureau (CFPB) recently instituted new rules, that aim to govern collection and disclosure practices of the debt collectors and enforce those standards. These regulations have contributed to a higher ESG relevance score for customer welfare -fair messaging, privacy & data security. The Stable Outlook reflects the margin of safety against a potential slowdown in debt-collection and/or changes to estimated recoveries and extended unavailability of unsecured funding, that is provided by PRA's conservative leverage profile and its ability to moderate portfolio purchases to preserve liquidity.. The Stable Outlook also assumes that any possible changes to PRA's collection practices resulting from the new rules by the CFPB or the resolution of the Civil Investigative Demand (CID) will have a minimal negative impact on the business model. The unsecured debt rating is equalized with the Long-Term IDR, reflecting Fitch's expectation of average recovery prospects in a stressed scenario. The negative impact from the presence of significant secured funding in a priority position is offset by lower leverage. RATING SENSITIVITIES Factors that could, individually or collectively, lead to negative rating action/downgrade: IDR AND SENIOR DEBT -- A sustained reduction in earnings generation, particularly if it leads to a weakening in key debt service ratios or other financial efficiency metrics; -- A sustained increase in debt/adjusted EBITDA above 2.5x or debt/tangible equity above 5x, whether resulting from a lack of EBITDA growth, an increase in acquisitions or reduction of tangible equity; -- A shift to a largely secured balance sheet funding model with unsecured mix below 20%; -- A weakening in asset quality, as reflected in acquired debt portfolios significantly underperforming anticipated returns or repeated material write-downs in expected recoveries; or -- An adverse operational event or significant disruption in business activities (for example arising from regulatory intervention in key markets adversely impacting collection activities), thereby undermining franchise strength and business model resilience. Factors that could, individually or collectively, lead to positive rating action/upgrade: Given the current operating environment, an upgrade is unlikely in the short term. However, over time, positive rating action could result from: -- Unsecured debt greater than 40% of total debt on a sustained basis; -- Leverage maintained consistently below 2.0x through the cycle on a debt/adjusted EBITDA basis and below 4.0x on a debt/tangible equity basis; and -- Demonstrated franchise strength and earnings resilience through the current economic cycle. PRA's senior unsecured debt rating is primarily sensitive to changes in the group's Long Term IDR and secondarily to the funding mix and recovery prospects on the unsecured debt. A material increase in the proportion of secured debt, which weakens recovery prospects for unsecured debtholders in a stressed scenario could result in the unsecured debt rating being notched down below the IDR. BEST/WORST CASE RATING SCENARIO International scale credit ratings of Financial Institutions and Covered Bond issuers have a best-case rating upgrade scenario (defined as the 99th percentile of rating transitions, measured in a positive direction) of three notches over a three-year rating horizon; and a worst-case rating downgrade scenario (defined as the 99th percentile of rating transitions, measured in a negative direction) of four notches over three years. The complete span of best- and worst-case scenario credit ratings for all rating categories ranges from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are based on historical performance. ESG CONSIDERATIONS PRA Group, Inc. has an ESG Relevance Score of '4' for Customer Welfare - Fair Messaging, Privacy & Data Security due to the importance of fair collection practices and consumer interactions and the regulatory focus on them, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. PRA Group, Inc. has an ESG Relevance Score of '4' for Financial Transparency due to the significance of internal modelling to portfolio valuations and associated metrics such as estimated remaining collections, which has a negative impact on the credit profile, and is relevant to the rating[s] in conjunction with other factors. Unless otherwise disclosed in this section, the highest level of ESG credit relevance is a score of '3'. This means ESG issues are credit-neutral or have only a minimal credit impact on the entity, either due to their nature or the way in which they are being managed by the entity. DEBT RATING PRIOR ---- ------ ----- PRA Group, Inc. LT IDR BB+ Affirmed BB+ senior unsecured LT BB+ Affirmed BB+ PRECISION AUTOMOTIVE: Taps Lefkovitz & Lefkovitz as Legal Counsel ----------------------------------------------------------------- Precision Automotive LLC seeks approval from the U.S. Bankruptcy Court for the Middle District of Tennessee to employ Lefkovitz & Lefkovitz, PLLC to serve as legal counsel in its Chapter 11 case. The firm's services include: (a) advising the Debtor regarding its rights, duties and powers; (b) preparing and filing statements of financial affairs and bankruptcy schedules, Chapter 11 plans and other documents; (c) representing the Debtor at all hearings, meetings of creditors, conferences, trials, and any other proceedings related to the case; and (d) performing other necessary legal services. The hourly rates of the firm's counsel and staff are as follows: Steven L. Lefkovitz $555 Associate Attorneys $350 Paralegals $125 The firm received a retainer of $5,000 from the Debtor. Steven Lefkovitz, Esq., an attorney at Lefkovitz & Lefkovitz, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in section 101(14) of the Bankruptcy Code. The firm can be reached through: Steven L. Lefkovitz, Esq. Lefkovitz & Lefkovitz, PLLC 618 Church Street, Suite 410 Nashville, TN 37219 Telephone: (615) 256-8300 Facsimile: (615) 255-4516 Email: slefkovitz@lefkovitz.com About Precision Automotive Precision Automotive, LLC filed a petition under Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. M.D. Tenn. Case No. 22-02067) on July 1, 2022, listing up to $50,000 in assets and up to $1 million in liabilities. Glen Watson of Watson Law Group, PLLC serves as Subchapter V trustee. Judge Randal S. Mashburn presides over the case. Steven Lefkovitz, Esq., at Lefkovitz & Lefkovitz, PLLC represents the Debtor as counsel. QUICKER LIQUOR: Says Plan Confirmable, Seeks Talks With Moody ------------------------------------------------------------- Debtors Nevada Wine Cellars Inc. ("NWC") and Quicker Liquor, Inc. ("QL") responded to disclosure statement objections filed by (1) purported creditors Giacomo Minella and Claudia Luppi ("Claimants"); and (2) Ernst W. Moody Revocable Trust ("Moody"). In reviewing the Objections, it should be kept in mind that Moody has already determined to vote against the Plan. The purpose of a disclosure statement is to provide creditors sufficient information to inform their vote on the plan; here, Moody is not in need of any additional information in order to determine how it will vote. However, Debtors and Moody have requested that the Court refer the disputes between Debtors and Moody for a settlement conference, which has tentatively been scheduled for August 15, 2022. Accordingly, Debtors request that the Court set a status hearing approximately seven days thereafter. The Debtors respectfully suggest that distribution and voting with respect to the Plan commence following that hearing. The Debtors assert that the Disclosure Statement, as Revised, Contains Adequate Information. * Discussion of Current Management. - In response to "Part One" of the ML Objection, Debtors have included the following language of the Disclosure Statement: [P]urported NWC creditors Giacomo Minella and Claudia Luppi ("Minella and Luppi") and QL claimant Moody Trust have asserted that Ms. Trout is not suitable to continue to manage the Debtors post-petition. If the Court agrees, Debtor will hire an outside manager to oversee the Debtors' operations. However, the anticipated cost of such an arrangement is at least $20,000 per month. * Compensation of Ms. Trout - In response to "Part Three" of the ML Objection, the Disclosure Statement expressly provides that Ms. Trout will not receive compensation for management of the Debtors. * Disclosure of Unsuccessful Attempts to Obtain Additional Investor Financing. - In response to "Part Five" of the ML Objection, Debtors assert that the details of prior efforts to obtain investor financing are not required to be disclosed, as the Disclosure Statement and Plan reflect that Debtors are not relying upon such investment prospects to fund cash flow. However, Debtors have added the following language to the Disclosure Statement: Debtors have tried unsuccessfully to attract additional investors. If Debtors are able to obtain investor equity infusion or refinancing on an earlier timeline, creditors would be paid on an accelerated basis. This is not Debtors' expectation. * Historical Liabilities and Past Performance - The Moody Objection asserts that additional disclosures are needed with respect to Debtor's historical financial performance. Debtors have made numerous additions to the Disclosure Statement to address this objection, including clarifying that 2019 positive cash flow represents taxable income plus depreciation and adding a discussion of Debtors' Paycheck Protection Program and Restaurant Revitalization Fund receipts. * Allegations Set Forth in Section II(A)(5) of the Moody Objection - Moody makes numerous statements regarding a "lack of explanation" with regard to specific entries in the Debtors' bank statements. The Court has previously ruled that Moody may complete its examination of the Debtor. It is submitted that particular inquiries regarding past expenses are not appropriate for inclusion in the Disclosure Statement. * Discussion of U.S. Trustee Fees - Debtors have added a new Article VII to the Disclosure Statement which addresses Moody's complaints with regard to US Trustee Fees and also to address comments received by Debtors from the Office of the U.S. Trustee. Debtors note that these changes have also been incorporated into the Plan, and expresses their appreciation to counsel for the Assistant U.S. Trustee for working cooperatively to resolve concerns regarding the Plan and Disclosure Statement. * Expenses Relating to Outdoor Equipment - Debtors' projections include an additional $150,000 "reserve" expense in October of 2022, which account includes capital expenditures and is intended to reflect, inter alia, the purchase of the outdoor pizza oven. * The Tax Analysis is Sufficient - Moody asserts, without analysis, that "Debtors' Disclosure Statement provides no meaningful analysis of the tax consequences attendant to the Plant" (sic.). In fact, the Debtors' tax analysis appropriately summarizes the provisions of 26 U.S.C. section 108 and further advises creditors to consult with their own tax professionals. According to Debtors, while confirmation issues are not ripe for determination, the Plan on its face does not fail to meet confirmation requirements: * First, Moody argues that "[t]he Plan obliterates the rights of unsecured creditors to vote by incorrectly deeming their claims 'unimpaired.'" To the contrary, the Plan recognizes at Section 4.2 that: "All Classes are impaired under the Plan." * Moody next asserts that the Plan cannot be confirmed because it permits Hobbs to retain an equity interest without paying new value.. However, the Plan appropriately provides for new value to be provided. * Finally, Moody argues that the Plan is not feasible. Initially, this issue is clearly one which is fact-intensive and appropriate for consideration only in connection with confirmation. Additionally, Debtors note that their cash flow projections for 2023 are very similar to (and slightly less than) the pro forma BIDTA projected by Moody's expert. It should also be noted that: "In assessing the evidence adduced for the feasibility requirement, "[t]he Code does not require the debtor to prove that success is inevitable, ... and a relatively low threshold of proof will satisfy section 1129(a)(11)." [Proposed] Counsel for Nevada Wine Cellars Inc.: Candace C. Carlyon, Esq. Tracy M. O'Steen, Esq. CARLYON CICA CHTD. 265 E. Warm Springs Road, Suite 107 Las Vegas, NV 89119 Telephone: (702) 685-4444 Facsimile: (725) 220-4360 E-mail: ccarlyon@carlyoncica.com tosteen@carlyoncica.com [Proposed] Counsel for Debtor Quicker Liquor: A.J. Kung, Esq. Brandy L. Brown, Esq. KUNG & BROWN 1020 Garces Avenue Las Vegas, Nevada 89101 Telephone: (702) 382-0883 Facsimile: (702) 382-2720 E-mail: ajkung@ajkunglaw.com bbrown@ajkunglaw.com About Quicker Liquor Quicker Liquor, LLC, and its affiliate, Nevada Wine Cellars, Inc., filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Lead Case No. 22-10331) on Jan. 31, 2022. In their petitions, the Debtors listed as much as $10 million in both assets and liabilities. Kathy Trout, managing member, signed the petitions. Judge Mike K. Nakagawa oversees the cases. Quicker Liquor and Nevada Wine Cellars are represented by Kung & Brown and Carlyon Cica Chtd., respectively. The Law Offices of Timothy Elson serves as the Debtors' special counsel. The Debtors filed a joint Chapter 11 plan of reorganization on May 31, 2022. QUICKER LIQUOR: Unsecureds to Recover 100% Without Interest in Plan ------------------------------------------------------------------- Quicker Liquor LLC ("QL") and Nevada Wine Cellars, Inc. ("NWC") submitted a First Amended Disclosure Statement. NWC owns the real property consisting of the parcel commonly known as 3810 Winery Road, Pahrump, NV 89048, upon which the Winery and related facilities are located; as well as the real property commonly known as 3940 E. Winery Road, Pahrump, NV 89048, which is usable as a parking lot and potentially for future development. NWC has cash on hand of approximately $216,000 as of April 30, 2022, as well as inventory, furnishing, fixtures and equipment. Moody has undertaken appraisals of the real property and other assets, including the business operations of NWC, and determined the total value of NWC to be $6,091,000. QL's assets consist of its equity ownership of NWC. Class 5: NWC General Unsecured Claims (other than Class 6, 7, and 8 Claims) total $25,000, based on scheduled claims. An additional claim in the amount of approximately $4.9 million was filed by Giacamo Minella and Claudia Luppi. However, the attachments to that proof of claim show that the debt is not owed by NWC. NWC has filed an objection to that claim, which is currently set for hearing on July 13, 2022. NWC Allowed General Unsecured Claims will be paid 100% of the principal amount of their Allowed Claims, without interest, from the Cash Flow Payments pro rata with Class 7 creditors. Class 5 is impaired. Class 6: NWC Administrative Convenience Class (claims under $5,000) totaling $9,000 will be paid 100% of the principal amount of their Allowed Claims, without interest, within 60 days following the Effective Date. Class 6 is impaired. Class 8: NWC Unsecured Claims of Hobbs totaling $249,654 will be subordinated to payment of all non-insider claims. Class 8 is impaired. As to Class 11: QL Unsecured Claims, in addition to Moody's potential unsecured claim, Hobbs has filed an unsecured claim of $249,654, and the SBA may assert a claim in this class. The Allowed General Unsecured Claims against QL will be paid, pro rata with Class 10, an amount equal to $6,091,000 less (1) all payments made on account of Claims (whether or not Classified) against NWC (2) all administrative and priority claims against QL; and (3) all payments made on account of the Moody secured claim via quarterly Upstream Capital Payments; provided that, if such payments have not totaled at least 10% of the principal amount of any allowed Class 11 Claims on the Payment Date, Debtors will make a lump sum payment necessary to cause distributions on Class 11 Claims to equal at least 10% of the amount of allowed Class 11 Claims on the Payment Date. Class 11 is impaired. The Debtors' primary method of funding the payments required by the Plan shall be through NWC's continued operation of its businesses. Debtor anticipates generating additional funds from litigation recoveries, obtaining financing, obtaining investor funds and sale of all or a portion of the debtor's businesses or assets. [Proposed] Counsel for Nevada Wine Cellars Inc.: Candace C. Carlyon, Esq. Tracy M. O'Steen, Esq. CARLYON CICA CHTD. 265 E. Warm Springs Road, Suite 107 Las Vegas, NV 89119 Telephone: (702) 685-4444 Facsimile: (725) 220-4360 E-mail: ccarlyon@carlyoncica.com tosteen@carlyoncica.com [Proposed] Counsel for Debtor Quicker Liquor: A.J. Kung, Esq. Brandy L. Brown, Esq. KUNG & BROWN 1020 Garces Avenue Las Vegas, Nevada 89101 Telephone: (702) 382-0883 Facsimile: (702) 382-2720 E-mail: ajkung@ajkunglaw.com bbrown@ajkunglaw.com A copy of the First Amended Disclosure Statement dated July 6, 2022, is available at https://bit.ly/3OVq38I from PacerMonitor.com. About Quicker Liquor Quicker Liquor, LLC, and its affiliate, Nevada Wine Cellars, Inc., filed voluntary petitions for relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Lead Case No. 22-10331) on Jan. 31, 2022. In their petitions, the Debtors listed as much as $10 million in both assets and liabilities. Kathy Trout, managing member, signed the petitions. Judge Mike K. Nakagawa oversees the cases. Quicker Liquor and Nevada Wine Cellars are represented by Kung & Brown and Carlyon Cica Chtd., respectively. The Law Offices of Timothy Elson serves as the Debtors' special counsel. The Debtors filed a joint Chapter 11 plan of reorganization on May 31, 2022. REMARK HOLDINGS: All Four Proposals Passed at Annual Meeting ------------------------------------------------------------ Remark Holdings, Inc. held its annual meeting of stockholders at which the stockholders: (1) elected Theodore P. Botts, Brett Ratner, Daniel Stein, Kai-Shing Tao, and Elizabeth Xu as directors to serve until the Company's 2023 annual meeting of stockholders and until their successors are duly elected and qualified; (2) ratified the appointment of Weinberg & Company, P.A. as the Company's independent registered public accounting firm for the fiscal year ending Dec. 31, 2022; (3) approved a non-binding, advisory resolution authorizing the compensation of the Company's named executive officers; and (4) adopted and approved the Company's 2022 Incentive Plan. About Remark Holdings Remark Holdings, Inc. (NASDAQ: MARK) -- http://www.remarkholdings.com-- its subsidiaries, and the variable-interest entities that the company consolidates, constitute a diversified global technology business with leading artificial intelligence and data-analytics, as well as a portfolio of digital media properties The company's easy-to-install AI products are being rolled out in a wide range of applications within the retail, urban life cycle and workplace and food safety arenas. The company also owns and operates digital media properties that deliver relevant, dynamic content and ecommerce solutions. The company's corporate headquarters and U.S. operations are based in Las Vegas, Nevada, and it also maintain operations in London, England and Shanghai, China. The operations of the variable interest entities the company consolidates are headquartered in Chengdu, China with additional operations in Hangzhou. As of March 31, 2022, the Company had $47.12 million in total assets, $40.99 million in total liabilities, and $6.12 million in total stockholders' equity. Los Angeles, California-based Weinberg & Company, the Company's auditor since 2020, issued a "going concern" qualification in its report dated March 31, 2022, citing that the Company has suffered recurring losses from operations and negative cash flows from operating activities and has a negative working capital and a stockholders' deficit that raise substantial doubt about its ability to continue as a going concern. REVENANT DENVER: Unsecureds Owed $1M to be Paid 100% With Interest ------------------------------------------------------------------ Revenant Denver Inc., f/k/a Futurum Communications Corporation, Revenant Durango Inc., f/k/a Brainstorm Internet Inc., and Revenant Eagle Inc., f/k/a San Isabel Telecom, Inc. submitted a Modified Disclosure Statement for Second Amended Chapter 11 Plan dated July 6, 2022. The Debtors' assets following the closing of the asset sale are primarily cash, claims, and retainers with professionals. These assets are generally described below: The Net Sale Proceeds were deposited into an escrow account at U.S. Bank among all the Sellers and U.S. Bank as the escrow agent, created on December 23, 2021 (the "Disbursement Escrow"), except for the $1 million for the Working Capital Adjustment which is being held in a separate escrow account at U.S. Bank among Sellers and Purchaser. As of May 31, 2022, the Disbursement Escrow contains $1,447,578.00. The Debtors have the right to receive the $1 million Working Capital Amount, subject to reductions as provided in the Revised APA. As previously described, the Purchaser has claimed reductions that exceed this amount which is disputed by Sellers. The Debtors have the right to receive the Additional Compensation of $1.75 million in March 2024, on the conditions identified in the Revised APA. As previously described, the Purchaser has to date claimed reductions of close to $500,000 of this amount which Sellers have not yet been able to evaluate. The Debtors have very recently received a check in the amount of $341,613.34 for past unreimbursed construction expenses which will be deposited into the Disbursement Escrow. As of May 31, 2022, Debtors have cash in bank accounts, exclusive of the Disbursement Escrow, the aggregate of $284,893.96. The Debtors have claims against Jessica Hoff and Hoff Law Offices for, among other things, the return of the retainers paid to Jessica Hoff and Hoff Law Offices in connection with the Debtors' cases totaling more than $70,000. Revenant Eagle owns a certain FCC license to use over-the-air radio spectrum that was excluded from the Asset Sale. Revenant Eagle has no expectation of using or selling the spectrum licenses. Revenant Denver owns certain software identified as SIP Tandem. Revenant Denver does not know if there is a market for such software or the value thereof. Revenant Denver owns 100% of the stock in Revenant Teller, which as of March 11, 2022, has cash totaling $52,502.71. Revenant Denver anticipates that the bulk of Revenant Teller's existing cash will be used to pay final invoices of Revenant Teller's professionals and any remaining pre-Closing invoices that Revenant Teller may receive for operational expenses incurred prior to the Closing. Under the Plan, Class 4 General Unsecured Claims total $1,118,761. In connection with the Asset Sale, certain executory contracts and unexpired leases were assumed and assigned to the Purchaser, and approximately $1,494,163 in aggregate cure amounts were paid to such counterparties which would have otherwise constituted Claims against Debtors' estates; see Exhibit 3 with following link: https://bit.ly/3yRsWC1 for a list of these payments through March 8, 2022. Counterparties whose executory contracts were not assumed and assigned to the Purchaser will have the opportunity to file rejection damage Claims against Debtors on or before 30 days after the Effective Date. The Debtors do not know if any of these Claims will be filed, or the likely amounts; however, Purchaser represented at the hearing on the Sale Motion that it will keep rejection Claims to less than $100,000. While Debtors have not yet reviewed in detail many of the General Unsecured Claims, Debtors have also included on Exhibit 3 an estimate of the total of actual payments it believes will be made. The allowed claims in this Class will be paid in full, including interest at the Federal Judgment Rate under 28 U.S.C. section 1961(a). Unless otherwise agreed Debtors will commence Cash pro rata payments on such Allowed Claims in Cash from the General Unsecured Claims Fund on the Initial Distribution Date (or within 20 business days after any such Claim becomes an Allowed Claim), and shall pay all such Allowed Claims in full no later than December 31, 2024. After the initial distribution, the CRO shall, in his discretion determine the timing for any additional distributions based on the budget and estimate of remaining Plan Expenses created pursuant to Article 8F of the Plan. All pro rata payments from the General Unsecured Claims Fund shall be made at the same percentage rate and at the same time regardless of the Debtor or the amount of Cash contributed by any Debtor to such fund. Class 4 is impaired. The funds necessary to establish reserves for and fund Plan expenses estimate the Allotment Amounts and make any other Plan payments shall be obtained from the Remaining Assets. Attorneys for the Revenant Denver Inc.: Andrew D. Johnson, Esq. Alice A. White, Esq. ONSAGER FLETCHER JOHNSON LLC 600 17th Street, Suite 425 North Denver, Colorado 80202 Tel: (720) 457-7061 E-mail: ajohnson@OFJlaw.com awhite@OFJlaw.com Attorneys for Revenant Eagle Inc.: Gregory S. Bell, Esq. BELL, GOULD, LINDER, AND SCOTT, P.C. 318 East Oak Street Fort Collins, CO 80524 Tel: (970) 493-8999 E-mail: gbell@bell-law.com Attorneys for Revenant Durango Inc.: Jeffrey A. Weinman, Esq. WEINMAN & ASSOCIATES, P.C. 730 17th Street, Suite 240 Denver, CO 80202-3506 Telephone: (303) 572-1010 Facsimile: (303) 572-1011 E-mail: jweinman@weinmanpc.com A copy of the Modified Disclosure Statement dated July 6, 2022, is available at https://bit.ly/3Imx3Jk from PacerMonitor.com. About Futurum Communications Corp. Futurum Communications Corporation -- https://forethought.net/ -- is an independent locally owned internet, cloud and communications service provider with offices in Denver, Grand Junction and Durango. Futurum Communications filed a petition for Chapter 11 protection (Bankr. D. Colo. Case No. 21-11331) on March 21, 2021, listing up to $50 million in both assets and liabilities. Affiliates San Isabel Telecom, Inc. and Brainstorm Internet, Inc. filed their voluntary Chapter 11 petitions (Bankr. D. Colo. Case Nos. 21-12534 and 21-12549) on May 12, 2021. The cases are jointly administered under Case No. 21-11331. Judge Kimberley H. Tyson oversees the cases. The Debtors tapped Onsager Fletcher Johnson, LLC as bankruptcy counsel; Lance J.M. Steinhart, PC as special counsel; SL Biggs as accountant; and r2 advisors llc as restructuring advisor. Debtor Futurum Communications Corporation's name was changed to Revenant Denver, Inc., et al., following the closing of the sale of the Debtors' assets to Vero Broadband LLC. Debtor Brainstorm Internet Inc. was renamed Revenant Durango Inc. San Isabel Telecom Inc. was renamed to Revenant Eagle Inc. RICHMOND HOSPITALITY: Taps LaMonica Herbst & Maniscalco as Counsel ------------------------------------------------------------------ Richmond Hospitality, LLC received approval from the U.S. Bankruptcy Court for the Eastern District of New York to hire LaMonica Herbst & Maniscalco, LLP to serve as legal counsel in its Chapter 11 case. The firm's services include: a. legal advice regarding the Debtor's powers and duties in the continued operation of its business and the management of its property; b. preparation of legal documents; c. formulation and implementation of a plan of reorganization; and c. other legal services that may be necessary to reorganize the Debtor's affairs under the Bankruptcy Code. The hourly rates charged by the firm's attorneys and paraprofessionals are as follows: Partners $675 Associates $425 Paraprofessionals $225 The firm received a retainer in the amount of $16,738. As disclosed in court filings, LaMonica is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Joseph S. Maniscalco, Esq. LaMonica Herbst & Maniscalco, LLP 3305 Jerusalem Ave #201 Wantagh, NY 11793 Phone: (516) 826-6500 Fax: (516) 826-0222 Email: jsm@lhmlawfirm.com About Richmond Hospitality Richmond Hospitality, LLC is a real estate hotel development owner and operator that was poised to develop an 80-room Best Western Vibe hotel in Staten Island. Richmond Hospitality filed its voluntary petition under Chapter 7 of the Bankruptcy Code on March 16, 2022. On May 18, 2022, the court ordered the conversion of the case to one under Chapter 11 (Bankr. E.D.N.Y. Case No. 22-40507). At the time of the filing, the Debtor listed $1 million to $10 million in both assets and liabilities. Judge Jil Mazer-Marino presides over the case. Joseph S. Maniscalco, Esq., at LaMonica Herbst & Maniscalco, LLP represents the Debtor as counsel. RIVERSTONE RESORT: Taps Munsch Hardt Kopf & Harr as Special Counsel ------------------------------------------------------------------- Riverstone Resort, LLC seeks approval from the U.S. Bankruptcy Court for the Southern District of Texas to employ Munsch Hardt Kopf & Harr, P.C. as special counsel. The firm's services include: a. representing the Debtor in the adversary case styled Hamzah Ali v. Riverstone Resort, LLC, Azhar Chaudhary and Azhar Chaudhary Law Firm, P.C. (Adversary No. 22-3154) filed in the U.S. Bankruptcy Court for the Southern District of Texas; b. representing the Debtor as co-counsel in the adversary case styled Riverstone Resort, LLC v. Prosperity Bank (Adversary No. 22-3117) filed in the U.S. Bankruptcy Court for the Southern District of Texas; c. handling any appeals that may result from the litigation; and d. performing any other legal services. The firm will charge these hourly fees: Richard A. Schwartz, Esq. $635 Elizabeth Eoff, Esq. $405 Kim Goldberg $275 As disclosed in court filings, Munsch is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Dick Schwartz, Esq. Munsch Hardt Kopf & Harr, P.C. 700 Milam Street, Suite 800 Houston, TX 77002-2806. Tel: 713-222-1470 Fax: 713-221-1475 Email: dschwartz@munsch.com About Riverstone Resort Riverstone Resort, LLC is the fee simple owner of a real property in Sugar Land, Texas, having an appraised value of $9.6 million. Riverstone Resort filed a petition for Chapter 11 protection (Bankr. S.D. Texas Case No. 21-33531) on Oct. 29, 2021, disclosing $9,620,007 in assets and $2,165,951 in liabilities. Judge Jeffrey P. Norman oversees the case. David L. Venable, Esq., a practicing attorney in Houston, Texas, is the Debtor's bankruptcy counsel. Sanjay R. Chadha Law, PLLC and Munsch Hardt Kopf & Harr, P.C. serve as special counsels. SAB AB: Scandinavian Airlines Expects $700M Financing in Weeks -------------------------------------------------------------- Forced to file for bankruptcy ahead of schedule due to a pilot strike, Scandinavian Airlines will focus on securing final commitment for $700 million in Chapter 11 financing in the coming weeks that will help fund its case and complete a broad financial and operational restructuring. The national flag carrier of Sweden, Denmark and Norway filed for bankruptcy in New York court Tuesday before it could reach terms with proposed debtor-in-possession lenders, according to a first-day declaration from Chief Financial Officer Erno Hilden. The Company said it is in advanced discussions with those potential lenders to secure debtor-in-possession financing to support the Company's liquidity during the Chapter 11 Cases and ensure the Company has sufficiently capital to complete its SAS FORWARD plan. The Company believes it will secure binding financing commitments in the coming weeks. SAS also has been actively seeking investors to infuse SEK 9.5 billion (approximately $950 million) in new equity capital to finance SAS's post-chapter 11 operations in accordance with SAS FORWARD. Prior to the Commencement Date, Seabury and SEB, on behalf of the Debtors, launched a solicitation process for such equity capital, contacting a broad range of over 90 private and state financing sources, both in and outside of Scandinavia, a number of which indicated interest in providing financing to SAS, both during and following these Chapter 11 Cases. The Company also solicited bids from these financing sources for approximately $700 million in debtor-in-possession financing ("DIP Financing"). Prior to the Commencement Date, the Company received strong interest from investors and initially anticipated filing these Chapter 11 Cases with committed capital to fund the DIP Financing. However, as a consequence of the strike and resulting uncertainty and liquidity impact, the Company was forced to commence the Chapter 11 Cases prior to securing DIP Financing commitments. The Company expects to complete this process in the near term and return to the Bankruptcy Court with a request for approval of such financing within the coming weeks. Despite filing these Chapter 11 Cases earlier than anticipated and without DIP Financing in place, the Company remains confident it will secure the necessary financing to fund the Chapter 11 Cases and ongoing operations. About Scandinavian Airlines SAS SAB, Scandinavia's leading airline, with main hubs in Copenhagen, Oslo and Stockholm, is flying to destinations in Europe, USA and Asia. Spurred by a Scandinavian heritage and sustainable values, SAS aims to be the global leader in sustainable aviation. The airline will reduce total carbon emissions by 25 percent by 2025, by using more sustainable aviation fuel and our modern fleet with fuel-efficient aircraft. In addition to flight operations, SAS offers ground handling services, technical maintenance and air cargo services. SAS is a founder member of the Star Alliance, and together with its partner airlines offers a wide network worldwide. On the Web: https://www.sasgroup.net/ SAS AB and its affiliates, including Scandinavian Airlines Systems Denmark-Norway-Sweden and Scandinavian Airlines of North America Inc., sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 22-10925) on July 5, 2022. In the petition filed by Erno Hildén, as authorized representative, the Debtor SAS AB estimated assets between $10 billion and $50 billion and liabilities between $1 billion and $10 billion. Weil, Gotshal & Manges LLP is serving as global legal counsel and Mannheimer Swartling Advokatbyra AB is serving as Swedish legal counsel to SAS. Seabury Securities LLC and Skandinaviska Enskilda Banken AB are serving as investment bankers, Seabury is also serving as restructuring advisor. FTI Consulting is serving as financial advisor. Kroll Restructuring Advisors is the claims agent. SCHULTE PROPERTIES: Plan Headed to Confirmation Hearing ------------------------------------------------------- Judge Mike K. Nakagawa has entered an order approving the Disclosure Statement to Accompany Schulte Properties LLC's Plan of Reorganization #3. A conference to set a hearing on confirmation of Debtor's Plan of Reorganization #3, filed April 29, 2022, will be held on July 27, 2022, at 10:30 a.m. The Court having reviewed the Disclosure Statement as well as the written and oral arguments presented, approves the Plan #3 Disclosure Statement as containing adequate information within the meaning of Section 1125(a). Almost certainly the creditors objecting to the sufficiency of the Plan #3 Disclosure Statement will reject claim treatment under proposed Plan #3, but some creditors have settled with the Debtor by agreeing to the terms on which their secured claims will be paid going forward. Depending on the value of the real property securing their claims, some of the objecting creditors may have allowed unsecured claims under Section 506(a) that must be classified and treated separately. For the creditor classes that reject plan treatment, the Debtor will have to seek cramdown under Section 1129(b). Before even attempting cramdown through fair and equitable treatment of dissenting classes, an impaired class of creditors will have to accept plan treatment. But the Debtor's objectives are not a mystery: it seeks to resolve its disputes over the servicing of the former loans by adjudicating the various charges and loan balances, and memorializing the final results through superseding promissory notes, deeds of trust, and payment schedules. Much as some of the creditors were able to avoid litigation expenses by settling their differences and negotiating plan treatment with the Debtor, nothing prevents the others from doing so now. A confirmed Chapter 11 plan is, after all, equivalent to a contract that is binding on creditors and the Debtor. Having reviewed the proposed Plan #3 Disclosure Statement, the Court cannot conclude that Plan #3 is unconfirmable on its face. Likewise, the court cannot conclude that Plan #3 is confirmable on its face. Either conclusion must await the presentation of a complete record that is not currently before the court. This focus of all of these arguments is not whether adequate information has been provided to allow creditors to make a decision whether to accept or reject their particular plan treatment, but whether the requirements for confirming Plan #3 under Section 1129 can be met. The legal reality is that the adequacy of disclosure can be revisited at plan confirmation. The risk of inadequate disclosure squarely falls upon the Debtor as the plan proponent. Moreover, it also reflects the allocation of the burdens at plan confirmation: as the plan proponent, Debtor must prove by a preponderance of the evidence that all applicable requirements of Section 1129(a) and Section 1129(b) are met. The objecting creditors do not have that burden, but do have the opportunity to present evidence – percipient, expert, and documentary – to rebut, contradict, or even bolster the evidence offered by the Debtor. Likewise, parties in interest other than the current objecting creditors are free to object to plan confirmation on any of the grounds relevant under Section 1129, including classification, good faith, valuation, best interests, feasibility, and fair and equitable treatment of dissenting classes. Unfortunately, the most active participants in this Chapter 11 proceeding apparently have a long history that pre-dates the 2009 Bankruptcy. Now in its third calendar decade, at least some of the continuing disputes appear to result from inertia rather than an objective cost-benefit evaluation. Under the circumstances, the Court concludes that the Plan #3 Disclosure Statement contains adequate information to enable the objecting creditors, as well as other parties in interest, to make an informed judgment about the Debtor's proposed Chapter 11 plan of reorganization. About Schulte Properties Schulte Properties, LLC is the fee simple owner of various real properties in Las Vegas and Henderson, Nev. The Debtor first sought protection from creditors (Bankr. D. Nev. Case No. 17-12883) on May 31, 2017. Schulte Properties filed a voluntary Chapter 11 petition (Bankr. D. Nev. Case No. 18-12734) on May 10, 2018. Judge Laurel E. Babero oversees the case. In the petition signed by Melani Schulte, managing member, the Debtor disclosed $10 million to $50 million in both assets and liabilities. The Debtor tapped Matthew L. Johnson, Esq., at Johnson & Gubler P.C., as its bankruptcy counsel and Matthew Carlyon, Esq., an attorney practicing in Chicago, as its special litigation counsel. SIGNET JEWELERS: S&P Alters Outlook to Positive, Affirms 'BB-' ICR ------------------------------------------------------------------ S&P Global Ratings revised its outlook to positive from stable and affirmed its ratings on diamond and jewelry retailer Signet Jewelers Ltd. and its debt, including its 'BB-' issuer credit rating on the company. The positive outlook reflects the potential for an upgrade if Signet extends its good operating performance and maintains S&P Global Ratings-adjusted leverage below 3x amid a weakening economic environment that S&P expects will negatively affect discretionary consumer spending. S&P said, "Our outlook revision reflects the potential for Signet to demonstrate resilient performance and good credit measures through economic weakness, which would support a higher rating. We believe the company's strategic initiatives for new product launches, a diversified banner portfolio, connected e-commerce presence, data analytics capabilities, and operating scale will help the company maintain good performance levels. We also believe Signet's significant exposure to bridal related sales--a significant source of revenue--will help support performance over 2022 and 2023 as pent-up wedding demand remains robust. We hold this view despite expecting a continuation of slower performance as was experienced in the first quarter this year, especially for Signet's fashion-oriented verticals. "For the next 12 months, we project flat to modestly lower sales, along with adjusted EBITDA margins in the mid-18% area, down moderately from very good levels last year. Our projection assumes normalized sales and EBITDA over the next 12 months compared with extraordinary growth in fiscal 2022. Our base case scenario acknowledges potential performance risks as Signet remains susceptible to changes in consumer discretionary spending that may weaken because of inflationary pressures and an economic slowdown." Signet generated better-than-projected performance in fiscal 2022 and improved credit metrics--to 1.4x in 2021 from 3.2x in the prior year--that have sustained into the first quarter of the fiscal year. A combination of greater consumer confidence, company initiatives, and the opening of the economy drove better performance for Signet on the top- and bottom-line last year. This helped lead to adjusted EBITDA margins approaching 20% and an improvement in S&P Global Ratings-adjusted leverage to the mid-1x area last year. While performance appears to have slowed in the first quarter of this fiscal year, Signet sustained credit metrics consistent with last year's results. A sustained volume of weddings in the U.S. should help partially offset the effects of an economic slowdown. Signet generates significant revenue from wedding jewelry and related products, and we think this customer may help alleviate weakness in other verticals. Historically, wedding-related products contributed between 45% and 50% of total revenue for Signet. This includes traditional wedding bands and engagement rings, along with other jewelry and accessories. The number of weddings in the U.S. declined significantly over the past two years due to the pandemic, falling by almost 50% compared with the long-term trend, reaching a nadir in 2020. Wedding volume has rebounded and is now trending above pre-pandemic levels, with weddings in the U.S. estimated at 2.5 million or more this year and remaining elevated next year. S&P thinks the elevated level of weddings over the next two years will occur due to pent-up demand and will help drive wedding jewelry and related product sales for Signet. S&P said, "We believe Signet will generate meaningful free cash flow and maintain supportive financial policy economic uncertainty notwithstanding. We project Signet will generate operating cash flow of about $900 million annually. We also expect the company to prioritize business reinvestment, returns to shareholders, and managing its credits metrics, leading to an increase in capital investment to about $250 million from nearly $130 million last year. These investments include store investments and streamlining operations in addition to fueling continued digital and technology advancements. "After business investment, we expect Signet to generate solid free operating cash flow (FOCF) more than $600 million annually, supporting financial flexibility, including a strong cash position. We also anticipate excess cash balances will be returned to shareholders in line with its relatively conservative capital allocation policy. Moreover, free operating cash generation will likely be used to help maintain credit protection measures. This includes S&P Global Ratings-adjusted leverage in the mid-1x area and funds from operations to debt in the high-50% area over the next 12-18 months. "We also believe the company's funded debt levels will remain low, consisting of only the $147 million of unsecured notes. While our adjusted credit leverage projections include lease obligations and the preferred share that we consider as debt, we believe that reported leverage will likely remain very low absent a significant change in financial policy that we do not foresee. We also expect ample headroom even with an uncertain economic environment. "A greater potential for an economic slowdown elevates the risks for weakening operating performance. We expect the operating environment for the jewelry industry and Signet to remain uncertain. Inflationary pressures, a slowing economy, and global supply chain delays could significantly weigh on discretionary spending. In addition, we believe Signet remains susceptible to customer segmentation in the lower-income brackets, where persistent inflation may negatively affect confidence more acutely. Moreover, shifting customer preferences, particularly among millennials, who had historically preferred to spend more on experiences than on material goods, could exaggerate operating performance risks. Signet also remains mainly a physical retailer with a significant mall-centric store base across its banners. Our rating incorporates our view that the company remains susceptible to changes in consumer discretionary spending, and we maintain our negative comparable ratings analysis modifier. We hold this view despite having a positive opinion on the company's aggressive and well-executed operational initiatives, including the good omni-channel integration and customer engagement, along with the relatively low leverage." The positive outlook reflects the potential for an upgrade if Signet extends its good operating performance record, meeting or exceeding our base case forecast, and maintains its S&P adjusted leverage below 3x through a more challenging backdrop. S&P could raise its rating on Signet if: -- It effectively managed its performance amid the uncertain operating environment such that it sustained consistent performance, which indicates that it is positioned for long-term competitive success. Under such a scenario, the company would maintain material profitability while generating significant FOCF; and -- It kept a conservative financial policy, including S&P Global Ratings-adjusted debt to EBITDA below 3x in a weaker operating environment. S&P said, "We could revise our outlook back to stable if an economic slowdown and inflationary prices led to a significant reversal in its operating trends. Under this scenario, the company's sales and profitability would decline below our base case forecast, likely resulting materially worse leverage." ESG credit indicators: E-2, S-2, G-2 SNIPER SERVICES: Seeks to Hire Eric A. Liepins as Legal Counsel --------------------------------------------------------------- Sniper Services, LLC seeks approval from the U.S. Bankruptcy Court for the Northern District of Texas to hire Eric A. Liepins, PC as its bankruptcy counsel. The Debtor requires legal assistance to liquidate its assets, reorganize the claims of the bankruptcy estate, and determine the validity of claims asserted against the estate. The hourly rates of the firm's counsel and staff are as follows: Eric A. Liepins $275 Paralegals and Legal Assistants $30 - $50 In addition, the firm will seek reimbursement for expenses incurred. The firm received a retainer of $5,000. Mr. Liepins, the sole shareholder of the firm, disclosed in a court filing that his firm is a "disinterested person" as that term is defined in Section 101(14) of the Bankruptcy Code. The firm can be reached through: Eric A. Liepins, Esq. Eric A. Liepins, PC 12770 Coit Road, Suite 850 Dallas, TX 75251 Telephone: (972) 991-5591 Facsimile: (972) 991-5788 Email: eric@ealpc.com About Sniper Services Sniper Services, LLC filed its voluntary petition for relief under Chapter 11 of the Bankruptcy Code (Bankr. N.D. Texas Case No. 22-41502) on July 4, 2022, disclosing up to $50,000 in assets and up to $500,000 in liabilities. Eric A. Liepins, Esq., represents the Debtor as counsel. SUMMER AVE: Wins Cash Collateral Access Thru Aug 18 --------------------------------------------------- The U.S. Bankruptcy Court for the District of Massachusetts, Western Division, authorized Summer Ave LLC to use cash collateral under the same terms and conditions as the previous order through August 18, 2022. As previously reported by the Troubled Company Reporter, the creditors that claim security interests in the Debtors' properties are Community Loan Servicing, LLC and Belvidere Capital, LLC. As adequate protection for any diminution in value as a result of the Debtor's use of cash collateral, all secured creditors were granted replacement liens and security interest to the same extent, validity, and enforceability of their perfected security interests as of the petition date not subject to avoidance. The Court said that, due to a conflict in the Court's calendar, the hearing on this matter set for August 11 has been rescheduled. The hearing will now be held on Thursday, August 18 at 12:30 p.m. via Zoom video conference. About Summer Ave, LLC Summer Ave, LLC is a limited liability company that owns commercial property, consisting of three buildings and two parking lots, each on a separate parcel, with building addresses of (i) 431-435 White Street, (ii) 429 White Street and 752 Sumner Avenue, and (iii) 760 Sumner Avenue, Springfield, Massachusetts. The Debtor sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Mass. Case No. 22-30140) on April 28, 2022. In the petition signed by Louis Masaschi, manager, the Debtor disclosed $778,100 in assets and $4,058,600 in liabilities. Judge Elizabeth D. Katz oversees the case. The Law Offices of Louis S. Robin represents the Debtor as counsel. TANGO HOMES: Seeks to Hire Langley & Banack as Bankruptcy Counsel ----------------------------------------------------------------- Tango Homes, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of Texas to employ Langley & Banack, Inc. to handle its Chapter 11 case. The firm will be paid at the rate of $400 per hour and will be reimbursed for its out-of-pocket expenses. William Davis, Jr., Esq., a partner at Langley & Banack, 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: William R. Davis, Jr., Esq. Langley & Banack, Inc. 745 E. Mulberry, Suite 700 San Antonio, TX 78212 Tel: (210) 736-6600 Email: wrdavis@langleybanack.com About Tango Homes Tango Homes, LLC sought protection for relief under Chapter 11 of the Bankruptcy Code (Bankr. W.D. Texas Case No. 22-50734) on July 5, 2022, listing as much as $50,000 in both assets and liabilities. Judge Craig A Gargotta presides over the case. William R. Davis, Jr., Esq., at Langley & Banack, Inc. represents the Debtor as counsel. TWITTER INC: S&P Retains 'BB+' ICR on CreditWatch Negative ---------------------------------------------------------- S&P Global Ratings retained all its ratings on Twitter Inc., including its 'BB+' issuer credit rating, on CreditWatch with negative implications, where S&P placed them April 25, 2022. S&P said, "We expect to resolve the CreditWatch when we obtain more information regarding the future of the take-private transaction or potential outcomes of litigation. We also could lower the rating if Twitter's operating performance suffers from negative publicity or economic weakness, raising leverage above 1.5x." Elon Musk has notified Twitter Inc. that he is seeking to terminate his agreement to acquire the company at $54.20 a share, and Twitter's board has indicated publicly that it intends to pursue litigation to force the deal to close. The unraveling of Mr. Musk's proposed takeover of Twitter carries multiple downside risks. Mr. Musk notified Twitter's board that he intends to terminate his agreement to acquire the company. Twitter chairman of the board Bret Taylor has publicly replied that the social media outlet intends to pursue legal action to enforce the agreement. S&P said, "We do not speculate on the outcome of litigation, but we believe it would increase uncertainty and reputational risk. If Twitter enforces the merger agreement and the transaction is completed, leverage will increase substantially. If Musk proves his claim that Twitter's userbase contains more "bots" than previously disclosed, it could significantly damage the firm's relationship with its advertisers and users. There are many other potential outcomes, including a renegotiation of terms or settling for the up to $1 billion breakup fee. While the breakup fee could be credit positive, we believe the negative publicity could harm Twitter's relationships with its advertisers, employees, and investors in all possible scenarios." Twitter's brand advertising revenue is exposed to economic cyclicality. The company generates about 90% of its total revenue from advertising, which is cyclical and tends to decline faster than the overall economy during an economic downturn. In the second quarter of 2020, Twitter's revenues declined almost 19% compared to the prior year. The company's revenue declined at a significantly greater rate than Alphabet Inc. and Meta Platforms Inc., given its greater mix of brand advertising as opposed to performance-based digital marketing. Twitter generates 85% of its advertising revenues from brand advertising, which is higher than its digital advertising peers'. In an economic downturn, advertisers tend to pull back on digital brand advertising and instead focus more on direct response advertising. S&P Global Ratings economists believe the risk of recession has increased significantly over the past six months as inflation remains above expectations and the U.S. Federal Reserve has become more aggressive with its interest rate policy. S&P will assess whether slowing macroeconomic growth could increase leverage above its 1.5x threshold when resolving the CreditWatch. S&P expects to resolve the CreditWatch when it obtains more information regarding the future of the take-private transaction or the potential outcomes of litigation. If the transaction is consummated at the original price, S&P expects to lower the rating by multiple notches due to increased leverage. If the transaction is terminated, S&P could still lower the rating or revise the outlook to negative if Twitter's operating performance suffers from negative publicity or economic weakness, raising leverage above 1.5x on a sustained basis. S&P would revise the outlook to stable if the dispute is resolved, it does not expect any long-term damage to Twitter's relationships with its users and advertisers, and it expects leverage to remain below 1.5x throughout an economic downturn. UNIVERSAL DOOR: Taps CPA Luis R. Carrasquillo as Consultant ----------------------------------------------------------- Universal Door and Window Manufacture Inc. seeks approval from the U.S. Bankruptcy Court for the District of Puerto Rico to employ CPA Luis R. Carrasquillo & Co., P.S.C. as its financial consultant. The Debtor needs a financial consultant to assist it in the financial restructuring of its affairs by providing advice in strategic planning, preparing a plan of reorganization and participating in negotiations with creditors. The retainer fee for the firm's services is $10,000. As disclosed in court filings, the firm and its members are disinterested persons within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: Luis R. Carrasquillo, CPA CPA Luis R. Carrasquillo & Co., P.S.C. 28Th Street, # TI-26 Turabo Gardens Ave. Caguas, P.R. 00725 Tel: (787) 746-4555/(787) 746-4556 Fax: (787) 746-4564 Email: luis@cpacarrasquillo.com About Universal Door Universal Door and Window Manufacture, Inc., a company based in San Sebastian, P.R., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. P.R. Case No. 22-01961) on July 5, 2022, disclosing $1.54 million in assets and $2.86 million in liabilities. Judge Enrique S. Lamoutte oversees the case. Alexis Fuentes-Hernandez, Esq., at Fuentes Law Offices, LLC and CPA Luis R. Carrasquillo & Co., P.S.C. serve as the Debtor's legal counsel and financial consultant, respectively. UNIVERSAL DOOR: Taps Fuentes Law Offices as Bankruptcy Counsel -------------------------------------------------------------- Universal Door and Window Manufacture Inc. seeks approval from the U.S. Bankruptcy Court for the District of Puerto Rico to employ the Fuentes Law Offices, LLC as bankruptcy counsel. The Debtor requires legal advice regarding its duties under the Bankruptcy Code and other legal services related to its Chapter 11 case. Alexis Fuentes-Hernandez, Esq., the firm's attorney, charges $250 per hour, plus expenses. His firm received the sum of $11,738 as retainer. In a court filing, Mr. Fuentes-Hernandez disclosed that he is a "disinterested person" as defined in Section 101(14) of the Bankruptcy Code. Mr. Fuentes-Hernandez maintains an office at: Alexis Fuentes-Hernandez, Esq. Fuentes Law Offices, LLC P.O. Box 9022726 San Juan, PR 00902-2726 Tel: (787) 722-5215, 5216 Fax: (787) 722-5206 Email: alex@fuentes-law.com About Universal Door Universal Door and Window Manufacture, Inc., a company based in San Sebastian, P.R., sought protection under Chapter 11 of the Bankruptcy Code (Bankr. D. P.R. Case No. 22-01961) on July 5, 2022, disclosing $1.54 million in assets and $2.86 million in liabilities. Judge Enrique S. Lamoutte oversees the case. Alexis Fuentes-Hernandez, Esq., at Fuentes Law Offices, LLC and CPA Luis R. Carrasquillo & Co., P.S.C. serve as the Debtor's legal counsel and financial consultant, respectively. VOYAGER DIGITAL: Files Dual-Track Chapter 11 Plan ------------------------------------------------- Voyager Digital Holdings, Inc. et al., submitted a "bare-bones" Joint Plan of Reorganization. The filing of the Plan didn't include an explanatory Disclosure Statement. The Company didn't indicate an estimated percentage recovery for its creditors and investors, projections, as well as other details. In only said that holders of Class 5 General Unsecured Claims will receive its pro rata share of the Claims Allocation Pool and that the class is impaired. The Plan, which was filed immediately after filing for Chapter 11 bankruptcy, provides for a standalone restructuring transaction that can be effectuated without a sale or a strategic partner. Under the Plan, account holders will receive a combination of (i) coins, (ii) new common shares in reorganized Voyager, (iii) existing VGX tokens, (iv) and any recovery on account of the 3AC Loan. Account holders can also elect to increase or decrease their pro rata recovery of equity in reorganized Voyager in exchange for an equal increase or decrease in the amount of coins such account holder is entitled to. Ultimately, the standalone restructuring will provide account holders with a meaningful recovery on account of their claims and vest ownership of the go-forward business of the Company in its customers. The Plan effectively functions as a "stalking horse" proposal. The Company will continue discussions with strategic third-party investors to solicit interest in sponsoring the Plan or otherwise providing financing to Voyager in exchange for partial or full ownership of the reorganized Company. Ultimately, pursuing the standalone restructuring and a marketing process in tandem will allow the Company to consummate the most value-maximizing transaction available. These chapter 11 cases provide the Company with the best opportunity to stabilize its business, consummate a comprehensive restructuring transaction that maximizes value for all stakeholders, and emerge from chapter 11 positioned for success in the cryptocurrency industry. The proposed transactions under the Plan will also allow the Company to consummate a restructuring transaction that will meet all applicable regulatory and operating requirements in each of the states in which it does business. The Company plans to engage with all constituencies, including the official committee of unsecured creditors (which will likely be composed of largely account holders), in a productive dialogue with the hope of building consensus around the Company's chapter 11 plan of reorganization and, ultimately, a transaction that will maximize the value of the Company's business. Counsel to the Debtors: Joshua A. Sussberg, Esq. Christopher Marcus, Esq. Christine A. Okike, Esq. Allyson B. Smith, Esq. KIRKLAND & ELLIS LLP KIRKLAND & ELLIS INTERNATIONAL LLP 601 Lexington Avenue New York, New York 10022 Telephone: (212) 446-4800 Facsimile: (212) 446-4900 A copy of the Joint Plan of Reorganization dated July 6, 2022, is available at https://bit.ly/3OUoWq2 from PacerMonitor.com. About Voyager Digital Based in Toronto, Canada, Voyager Digital Holdings Inc. -- https://www.investvoyager.com/ -- runs a cryptocurrency platform. Voyager claims to offer a secure way to trade over 100 different crypto assets using its easy-to-use mobile application. Through its subsidiary Coinify ApS, Voyager provides crypto payment solutions for both consumers and merchants around the globe. Voyager Digital Holdings Inc. and two affiliates sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead Case No. 22-10943) on July 5, 2022. In the petition filed by Stephen Ehrlich, as chief executive officer, the Debtor estimated assets and liabilities between $1 billion and $10 billion. The Debtors tapped KIRKLAND & ELLIS LLP as general bankruptcy counsel; BERKELEY RESEARCH GROUP, LLC, as financial advisor; MOELIS & COMPANY as investment banker; and CONSELLO GROUP as strategic financial advisor. STRETTO, INC., is the claims agent. WESTERN AUSTRALIAN: Seeks to Hire David M. Cole as Accountant ------------------------------------------------------------- Western Australian Holdings, LLC seeks approval from the U.S. Bankruptcy Court for the Western District of North Carolina to employ David M. Cole, CPA, LLC as its accountant to complete its 2020 and 2021 corporate tax returns. The firm has agreed to accept $3,400 for completion of the tax returns. As disclosed in court filings, the firm is a "disinterested person" within the meaning of Section 101(14) of the Bankruptcy Code. The firm can be reached through: David Cole, CPA David M. Cole, CPA, LLC 5401 S Kirkman Rd #700 Orlando, FL 32819 Phone: +1 407-536-2033 About Western Australian Holdings Western Australian Holdings, LLC -- https://www.majorsestate.com/ -- operates a 200-acre mountain ranch. Based in Clyde, N.C., the company conducts business under the name Majors Estate. Western Australian Holdings sought Chapter 11 bankruptcy protection (Bankr. W.D.N.C. Case No. 22-10058) on April 27, 2022. In the petition filed by Timothy F. Majors, manager, the Debtor listed up to $10 million in assets and up to $50 million in liabilities. Judge George R. Hodges oversees the case. Hendren Redwine & Malone, PLLC and David M. Cole, CPA, LLC serve as the Debtor's legal counsel and accountant, respectively. ZENTUARY GROUP: Seeks Cash Collateral Access -------------------------------------------- Zentuary Group LLC, a Florida limited liability company, asks the U.S. Bankruptcy Court for the Middle District of Florida, Tampa Division, for authority to use cash collateral and provide adequate protection, nunc pro tunc to the Petition Date. The Debtor requests authority to use cash collateral immediately to fund the operating expenses necessary to continue the operation of the business and to maintain the estate, to maximize the return on its assets, and to otherwise avoid irreparable harm and injury to its business and the estate. The Debtor proposes to use cash collateral for the continued operation of the business and for the care, maintenance and preservation of the Debtor's assets. The Debtor believes Torro LLC, Idea Financial, Mulligan Funding LLC, and the U.S. Small Business Administration may claim perfected and enforceable security interest and lien on, among other assets, the Debtor's inventory, accounts, and accounts receivables which constitute cash collateral pursuant to a promissory notes and UCC-1 financing statements 201907917851, 201908620690,201909305853, 202001904574,20210699664X, 202109349065,20210935580X filed with the Florida Department of State's Secured Transaction Registry. As adequate protection, the Debtor intends to provide the Secured Creditors with replacement liens to the same extent and validity as held by the Secured Creditors prior to the bankruptcy filing and other terms as set forth in the proposed Interim Order Authorizing Use of Cash Collateral. A copy of the motion and the Debtor's budget is available at https://bit.ly/3nW9AFA from PacerMonitor.com. The Debtor projects $65,000 in estimated sales and $60,629 in total expenses. About Zentuary Group LLC Zentuary Group LLC, doing business as Farmacy Vegan Kitchen, is a quick service restaurant offering a well-rounded, 100% plant-based menu. Zentuary Group LLC sought protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-02594) on June 28, 2022. In the petition filed by Charles Rumph, as president, the Debtor estimated liabilities between $500,000 and $1 million compared to estimated assets up to $50,000. James W Elliott, Esq., at McIntyre Thanasides Bringgold Elliott, et al, is the Debtor's counsel. ********* Monday's edition of the TCR delivers a list of indicative prices for bond issues that reportedly trade well below par. Prices are obtained by TCR editors from a variety of outside sources during the prior week we think are reliable. Those sources may not, however, be complete or accurate. The Monday Bond Pricing table is compiled on the Friday prior to publication. Prices reported are not intended to reflect actual trades. Prices for actual trades are probably different. Our objective is to share information, not make markets in publicly traded securities. Nothing in the TCR constitutes an offer or solicitation to buy or sell any security of any kind. It is likely that some entity affiliated with a TCR editor holds some position in the issuers public debt and equity securities about which we report. Each Tuesday edition of the TCR contains a list of companies with insolvent balance sheets whose shares trade higher than $3 per share in public markets. At first glance, this list may look like the definitive compilation of stocks that are ideal to sell short. Don't be fooled. Assets, for example, reported at historical cost net of depreciation may understate the true value of a firm's assets. A company may establish reserves on its balance sheet for liabilities that may never materialize. The prices at which equity securities trade in public market are determined by more than a balance sheet solvency test. On Thursdays, the TCR delivers a list of recently filed Chapter 11 cases involving less than $1,000,000 in assets and liabilities delivered to nation's bankruptcy courts. The list includes links to freely downloadable images of these small-dollar petitions in Acrobat PDF format. Each Friday's edition of the TCR includes a review about a book of interest to troubled company professionals. All titles are available at your local bookstore or through Amazon.com. Go to http://www.bankrupt.com/books/to order any title today. Monthly Operating Reports are summarized in every Saturday edition of the TCR. The Sunday TCR delivers securitization rating news from the week then-ending. TCR subscribers have free access to our on-line news archive. Point your Web browser to http://TCRresources.bankrupt.com/and use the e-mail address to which your TCR is delivered to login. ********* S U B S C R I P T I O N I N F O R M A T I O N Troubled Company Reporter is a daily newsletter co-published by Bankruptcy Creditors Service, Inc., Fairless Hills, Pennsylvania, USA, and Beard Group, Inc., Philadelphia, Pa., USA. Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante, Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon, Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and Peter A. Chapman, Editors. Copyright 2022. All rights reserved. ISSN: 1520-9474. This material is copyrighted and any commercial use, resale or publication in any form (including e-mail forwarding, electronic re-mailing and photocopying) is strictly prohibited without prior written permission of the publishers. Information contained herein is obtained from sources believed to be reliable, but is not guaranteed. The TCR subscription rate is $975 for 6 months delivered via e-mail. Additional e-mail subscriptions for members of the same firm for the term of the initial subscription or balance thereof are $25 each. For subscription information, contact Peter A. Chapman at 215-945-7000. *** End of Transmission ***