/raid1/www/Hosts/bankrupt/TCR_Public/220718.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, July 18, 2022, Vol. 26, No. 198
Headlines
1933 ASSOCIATES: Sterling Says Amended Disclosures Inadequate
2123 PARTNERS: Sterling Says Amended Disclosures Inadequate
511 LOGISTICS: Seeks to Hire Jones & Walden as Bankruptcy Counsel
96 WYTHE: Seeks Approval to Hire CohnReznick as Financial Advisor
A MEN OF SARASOTA: Case Summary & 11 Unsecured Creditors
AGILE THERAPEUTICS: Lind Global Entities Report 9.9% Equity Stake
AKOUSTIS TECHNOLOGIES: Signs Separation Agreement With Former CPO
ALLIANCE RESOURCE: S&P Alters Outlook to Pos., Affirms 'B+' ICR
AMERICAN SLEEP: Unsecureds to Get $7K per Month for 60 Months
ARCHBISHOP OF AGANA: Amends Plan to Include Other Abuse Claims
ARMSTRONG FLOORING: Reaches Agreement to Preserve Jobs In Lancaster
ASTECH ENGINEERED: Case Summary & 20 Largest Unsecured Creditors
BAMC DEVELOPMENT: Unsecureds Will Get 100% of Claims in Plan
BARTLEY INDUSTRIES: Valliance Says Plan Not Filed in Good Faith
BASA INVESTMENTS: Amy Stanley Says Plan Not Filed in Good Faith
BITNILE HOLDINGS: Forms Ault Energy to Make Strategic Acquisitions
CAPSTONE GREEN: Appoints Scott Robinson as Interim CFO
CENTURION PIPELINE: Fitch Affirms LT IDR at BB-, Outlook Stable
CHRISTIAN CARE: Ferguson Braswell Represents Reinsman, 3 Others
CHUB CAY: Seeks Approval to Hire Villa & White as Counsel
CLEVELAND-CLIFFS INC: S&P Raises Unsecured Debt Rating to 'B+'
COLORADO WORLD: Voluntary Chapter 11 Case Summary
CRED INC: Gets Court OK to Continue Claw Back Attempt From Investor
CRYOMASS TECHNOLOGIES: Qualifies to Trade on OTCQX
CUBIC CORP: Fitch Affirms IDR at 'B'; Outlook Stable
DALTON CRANE: Taps Jarratt Realty & Land as Realtor
DENTAL LAND: Seeks Interim Use of Cash Collateral
DIOCESE OF CAMDEN: Herman Law Represents Sexual Abuse Survivors
EAGLE LEDGE: Wins Interim Cash Collateral Access Thru Oct 31
EASCO BOILER: Seeks to Hire ASI as Financial Advisor
EASCO BOILER: Taps Riemer & Braunstein as Bankruptcy Counsel
ENCORE CAPITAL: Fitch Affirms BB+ LongTerm IDR, Outlook Stable
ENDLESS POSSIBILITIES: Gets Cash Collateral Access Thru July 28
EVO TRANSPORTATION: Maturity of $9M Loan Extended to July 15
FUELCELL ENERGY: Signs Deal to Sell 95 Million Common Shares
GATHERING PLACE: Seeks Cash Collateral Access
GENAPSYS INC: Wins Cash Collateral Access, $1MM DIP Loan
GRACE COMMUNITY: Seeks Approval to Hire Gordon Law as Counsel
GRIFFON CORP: S&P Affirms 'B+' ICR, Outlook Stable
HERITAGE POWER: S&P Lowers Senior Secured Debt Rating to 'CCC'
HORIZON GLOBAL: Corre Entities Report 9.9% Equity Stake
INDEPENDENCE FUEL: Files Emergency Bid to Use Cash Collateral
INNOVATION PHARMACEUTICALS: Kips Bay Owns 9.9% of Class A Shares
JBL RESTAURANT: Hires Real Estate Agents to Sell Latta Residence
KINGSTON LLC: Taps Law Office of Marc S. Stern as Counsel
KKR APPLE: S&P Affirms 'B' Issuer Credit Rating, Outlook Stable
LAFORTA-GESTAO: Cash Collateral Access, $19MM DIP Loan OK'd
LAKES INDUSTRIAL: Unsecureds to Get Share of Income for 5 Years
MAJESTIC HILLS: Amends Township Unsecured Claim Pay Details
MARRONE BIO: Common Stock Delisted From Nasdaq
MARRONE BIO: Stockholders Approve Merger Agreement with Bioceres
MATHESON TRUCKING: Case Summary & 20 Largest Unsecured Creditors
MUSCLEPHARM CORP: Sabina Rizvi Quits as President, CFO
NAVIENT CORP: Must Pause Post-Bankruptcy Student Loans Collection
NEW YORK OPTICAL: Amends Plan to Include Rodenstock Unsecured Claim
NINE DEGREES: Unsecured Creditors Will Get 24.72% Dividend
NRP LEASE: Harvest Small Business Says Plan Patently Unconfirmable
PATRIOT CREDIT: Creditors to Get Proceeds From Liquidation
PLATFORM II LAWNDALE: Files for Chapter 11 Bankruptcy Protection
PREMIER PAVING: Seeks Cash Collateral Access
RED VENTURES: Fitch Updates July 6 Ratings Release
REVLON INC: Akin Gump Represents 2016 Term Lenders
RIGHT ON BRANDS: Incurs $257K Net Loss in FY Ended March 31
ROCKY MOUNTAIN: Wins Cash Collateral Access Thru Aug 5
SCHRILLO COMPANY: Unsecureds Will Get 100% in Subchapter V Plan
SECURE ENERGY: S&P Affirms 'B' ICR, Outlook Positive
SEMILEDS CORP: Incurs $911K Net Loss in Third Quarter
SIMPLY GOOD: S&P Ups ICR to 'BB-' on Deleveraging, Outlook Stable
SINTX TECHNOLOGIES: Has Until Jan. 2 to Comply With Nasdaq Rule
SK HOLDCO: S&P Cuts ICR to 'SD' on Completed Distressed Exchange
STORCENTRIC INC: Continued Cash Access, $750,000 DIP Loan OK'd
SUMMIT LLC: Case Summary & Two Unsecured Creditors
THREE ARROWS: Founders' Whereabouts Unknown, Says Court Filing
TORINO CAMPUS: Case Summary & One Unsecured Creditor
TPC GROUP: Creditors Fight $238 Mil. Bankruptcy Loan Roll-Up
TRX HOLDCO: Wins Cash Collateral Access Thru July 24
VIVAKOR INC: Marcum LLP Replaces Macias Gini as Auditor
VOYAGER DIGITAL: Can't Guarantee All Customers to Receive Crypto
WALKER SERVICE: Trustee's Joint Plan Confirmed by Judge
WDT ACQUISITION: S&P Affirms 'B-' ICR, Outlook Stable
YOUNGEVITY INTERNATIONAL: Unit Secures $4M Secured Loan From GemCap
[^] BOND PRICING: For the Week from July 11 to 15, 2022
*********
1933 ASSOCIATES: Sterling Says Amended Disclosures Inadequate
-------------------------------------------------------------
Sterling Townhomes LLC, a secured creditor and party in-interest of
the bankruptcy estates of Debtor 1933 Associates LP and affiliate,
2123 Partners, LP, objects to each Debtor's Amended Disclosure
Statement in respect to Debtor's Amended Chapter 11 Plan of
Reorganization.
Sterling claims that the Amended Disclosure Statements should not
be approved because they do not contain adequate information within
the meaning of Section 1125(a)(1). In Section IV of the Amended
Disclosure Statements, the Debtors state that the Chapter 11 Plans
will be funded by a "Plan Contribution" by Myron Berman in the
approximate amount of $700,000 for the 1933 Debtor and $1,250,000
for the 2123 Debtor if the Debtors can cure-and reinstate the
subject Promissory Notes after the entry of Judgments thereon in
September 2020.
According to the Debtors, Myron Berman intends to sell some of his
real estate interests in order to obtain the funds necessary to
make the "Plan Contribution". Significantly, however, the Debtors
have wholly failed to disclose or provide adequate information
concerning (i) a pending lawsuit challenging Myron Berman's
ownership interest in BP Real Estate Investors; (ii) whether the
Warfield Property was sold on June 15, 2022 or whether the closing
date was extended and what the new closing date is; and (iii)
whether Myron Berman received the anticipated proceeds from the
sale of the Warfield Property.
Sterling asserts that the Amended Disclosure Statements also do not
contain adequate information because the Projections are wildly
optimistic when compared to the receiver reports since January
2021. The Debtors do not explain how they derived the Projections.
Even then, assuming the Merger Doctrine does not apply, there does
not appear to be debt service factored into the calculations.
Sterling further asserts that if the Mortgages are reinstated and
the Debtors pay Sterling under the Notes at the non-default rate of
interest then in the first year the Debtors will have net income of
almost negative $60,000 even using the optimistic Projections. Of
course, Sterling submits these Projections are not realistic and
the Debtors' income would be much less and therefore in even worse
shape. The Chapter 11 Plans are patently unconfirmable.
Finally, in Section IV of the Amended Disclosure Statements, the
Debtors state that they conducted an initial investigation to
identify potential avoidance claims and neither they nor their
counsel know of, or have reason to know of, claims against third
parties including Corey Berman. This statement is astonishing in
light of this Court's recognition during a hearing on June 1, 2022
of the undisputed fact of Corey Berman's unlawfully diversion of
tenant security deposits and rents from the Debtors and direction
to the Debtors to promptly file amended schedules to identify
claims against him.
Sterling contends that the Debtors have failed to comply with the
Court's direction. Moreover, the Amended Disclosure Statements make
a passing reference in Section 2 that Sterling's action against
Corey Berman "will be enjoined as of the Effective Date of the
Plan[s]." The Amended Disclosure Statements should not be approved
due to the Debtors' failure to disclose or provide adequate
information concerning the Debtor's rights or interests vis-a-vis
Corey Berman.
Sterling respectfully requests the Court to deny approval of the
Amended Disclosure Statements and to provide such other relief as
is appropriate and in the interest of creditors and the estates.
A full-text copy of Sterling's objection dated July 12, 2022, is
available at https://bit.ly/3II5VEM from PacerMonitor.com at no
charge.
Attorneys for Sterling Townhomes:
FOX ROTHSCHILD LLP
Robert F. Elgidely, Esq.
Joseph A. Caneco, Esq.
101 Park Avenue, 17th Floor
New York, New York 10178
(213)878-7900
And
David Giles, Esq.
2000 Market Street, 20th Floor
Philadelphia, Pennsylvania 19103
(216)299-2000
About 1933 Associates
1933 Associates LP, a company that is primarily engaged in renting
and leasing real estate properties, filed its voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y.
Case No. 21-42981) on Nov. 30, 2021, listing $3,021,000 in total
assets and $1,547,467 in total liabilities. Corey M. Berman, sole
partner, signed the petition. Judge Jil Mazer-Marino oversees the
case. Rosenberg, Musso & Weiner, LLP serves as the Debtor's
counsel.
2123 PARTNERS: Sterling Says Amended Disclosures Inadequate
-----------------------------------------------------------
Sterling Townhomes LLC, a secured creditor and party in-interest of
the bankruptcy estates of debtor 2123 Partners, LP and and
affiliate, 1933 Associates LP, objects to each Debtor's Amended
Disclosure Statement in respect to Debtor's Amended Chapter 11 Plan
of Reorganization.
Sterling claims that the Amended Disclosure Statements should not
be approved because they do not contain adequate information within
the meaning of Section 1125(a)(1). In Section IV of the Amended
Disclosure Statements, the Debtors state that the Chapter 11 Plans
will be funded by a "Plan Contribution" by Myron Berman in the
approximate amount of $700,000 for the 1933 Debtor and $1,250,000
for the 2123 Debtor if the Debtors can cure-and reinstate the
subject Promissory Notes after the entry of Judgments thereon in
September 2020.
According to the Debtors, Myron Berman intends to sell some of his
real estate interests in order to obtain the funds necessary to
make the "Plan Contribution". Significantly, however, the Debtors
have wholly failed to disclose or provide adequate information
concerning (i) a pending lawsuit challenging Myron Berman's
ownership interest in BP Real Estate Investors; (ii) whether the
Warfield Property was sold on June 15, 2022 or whether the closing
date was extended and what the new closing date is; and (iii)
whether Myron Berman received the anticipated proceeds from the
sale of the Warfield Property.
Sterling asserts that the Amended Disclosure Statements also do not
contain adequate information because the Projections are wildly
optimistic when compared to the receiver reports since January
2021. The Debtors do not explain how they derived the Projections.
Even then, assuming the Merger Doctrine does not apply, there does
not appear to be debt service factored into the calculations.
Sterling further asserts that if the Mortgages are reinstated and
the Debtors pay Sterling under the Notes at the non-default rate of
interest then in the first year the Debtors will have net income of
almost negative $60,000 even using the optimistic Projections. Of
course, Sterling submits these Projections are not realistic and
the Debtors' income would be much less and therefore in even worse
shape. The Chapter 11 Plans are patently unconfirmable.
Finally, in Section IV of the Amended Disclosure Statements, the
Debtors state that they conducted an initial investigation to
identify potential avoidance claims and neither they nor their
counsel know of, or have reason to know of, claims against third
parties including Corey Berman. This statement is astonishing in
light of this Court's recognition during a hearing on June 1, 2022
of the undisputed fact of Corey Berman's unlawfully diversion of
tenant security deposits and rents from the Debtors and direction
to the Debtors to promptly file amended schedules to identify
claims against him.
Sterling contends that the Debtors have failed to comply with the
Court's direction. Moreover, the Amended Disclosure Statements make
a passing reference in Section 2 that Sterling's action against
Corey Berman "will be enjoined as of the Effective Date of the
Plan[s]." The Amended Disclosure Statements should not be approved
due to the Debtors' failure to disclose or provide adequate
information concerning the Debtor's rights or interests vis-a-vis
Corey Berman.
Sterling respectfully requests the Court to deny approval of the
Amended Disclosure Statements and to provide such other relief as
is appropriate and in the interest of creditors and the estates.
A full-text copy of Sterling's objection dated July 12, 2022, is
available at https://bit.ly/3yGWNvE from PacerMonitor.com at no
charge.
Attorneys for Sterling Townhomes:
FOX ROTHSCHILD LLP
Robert F. Elgidely, Esq.
Joseph A. Caneco, Esq.
101 Park Avenue, 17th Floor
New York, New York 10178
(212)878-7900
- and -
David Giles, Esq.
2000 Market Street, 20th Floor
Philadelphia, Pennsylvania 19103
(215) 299-2000
About 2123 Partners
2123 Partners LP, a company that is primarily engaged in renting
and leasing real estate properties, filed its voluntary petition
for relief under Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y.
Case No. 21-42983) on Nov. 30, 2021, listing $5,533,000 in total
assets and $3,046,630 in total liabilities. Corey M. Berman, sole
partner, signed the petition. Judge Nancy Hershey Lord oversees
case. Rosenberg, Musso & Weiner, LLP, serves as the Debtor's
counsel.
511 LOGISTICS: Seeks to Hire Jones & Walden as Bankruptcy Counsel
-----------------------------------------------------------------
511 Logistics, Inc. seeks approval from the U.S. Bankruptcy Court
for the Northern District of Georgia to hire Jones & Walden, LLC to
serve as legal counsel in its Chapter 11 case.
The firm's services include:
(a) preparing pleadings and applications;
(b) conducting examination;
(c) advising the Debtor of its rights, duties and
obligations;
(d) consulting with and representing the Debtor with respect
to a Chapter 11 plan;
(e) performing those legal services necessary to the
operations of the Debtor's business;
(f) taking other actions incident to the proper preservation
and administration of the Debtor's estate and business.
The hourly rates of the firm's counsel and staff range as follows:
Attorneys $225 - $425
Paralegals $100 - $150
As of the petition date, the firm holds a $20,000 retainer.
Leon Jones, Esq., a partner at Jones & Walden, disclosed in a court
filing that his firm is a "disinterested person" as defined in
Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Leon S. Jones, Esq.
Jones & Walden, LLC
699 Piedmont Ave. NE
Atlanta, GA 30308
Telephone: (404) 564-9300
Email: ljones@joneswalden.com
About 511 Logistics Inc.
511 Logistics, Inc. is a licensed and bonded freight shipping and
trucking company running freight hauling business from Union City,
Ga.
511 Logistics filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No.
22-54893) on June 30, 2022, listing up to $50,000 in assets and up
to $1 million in liabilities. Gary M. Murphey has been appointed as
Subchapter V trustee.
Judge Wendy L. Hagenau oversees the case.
Leon S. Jones, Esq., at Jones & Walden, LLC is the Debtor's legal
counsel.
96 WYTHE: Seeks Approval to Hire CohnReznick as Financial Advisor
-----------------------------------------------------------------
Stephen Gray, the trustee appointed in the Chapter 11 case of 96
Wythe Acquisition LLC, seeks approval from the U.S. Bankruptcy
Court for the Southern District of New York to employ CohnReznick
LLP as his financial advisor.
The firm will assist the Trustee:
(a) in the identification, development and implementation of
strategies to maximize the value of the Debtor's assets;
(b) in managing the operations of the Debtor, to the extent
necessary;
(c) by providing forensic accounting/litigation support
analytics work to support the development of potential causes of
action;
(d) in the development of financial analysis and projections
regarding the Debtor's cash flow, operations and balance sheet to
preserve or maximize value for the estate including, but not
limited to, creating a weekly cash flow and a monthly budget and
preparing variances thereto, overseeing cash management, etc.;
(e) in preparing Monthly Operating Reports as required by the
United States Trustee; and
(f) in providing advice and analysis with respect to all other
related matters to support the Trustee in his administration of the
Debtor.
The firm will be paid at these hourly rates:
Partners/Principals $700 - $950
Managing Directors/Directors $600 - $850
Senior Managers/Managers $500 - $750
Senior/Associate Staff $250 - $550
Paraprofessionals $150 - $300
CohnReznick is a "disinterested person," as such term is defined in
Bankruptcy Code section 101(14), and does not hold or represent an
interest materially adverse to the Debtor's estate, according to
court filings.
The advisor can be reached through:
Cynthia Romano
CohnReznick LLP
1301 Avenue of the Americas
New York, NY 10019
Phone: 212-297-0400
About 96 Wythe Acquisition
96 Wythe Acquisition, LLC operates the Williamsburg Hotel, an
eight-story hotel located at 96 Wythe Ave., Brooklyn, N.Y.
96 Wythe Acquisition sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 21-22108) on Feb. 23,
2021, disclosing zero assets and $79,990,206 in liabilities. CRO
David Goldwasser signed the petition.
Judge Robert D. Drain oversees the case.
The Debtor tapped Backenroth Frankel & Krinsky, LLP and Mayer
Brown, LLP as bankruptcy counsel, and Fern Flomenhaft, PLLC as
insurance counsel. Getzler Henrich & Associates, LLC and Hilco Real
Estate, LLC serve as the Debtor's financial advisors. B. Riley
Advisory Services is the litigation support consultant.
Stephen Gray was appointed as Chapter 11 trustee. Togut, Segal &
Segal LLP serves as the trustee's legal counsel.
A MEN OF SARASOTA: Case Summary & 11 Unsecured Creditors
--------------------------------------------------------
Debtor: The A Men of Sarasota, Inc.
d/b/a Heal Strong
1151 Tamiami Trail S.
Suite 201
Venice, FL 34285
Business Description: The Debtor is a primary care provider
established in Venice, Florida specializing
in general practice.
Chapter 11 Petition Date: July 15, 2022
Court: United States Bankruptcy Court
Middle District of Florida
Case No.: 22-02849
Debtor's Counsel: Jake C. Blanchard, Esq.
BLANCHARD LAW, P.A.
1501 Belcher Road South
Unit 6B
Largo, FL 33771
Tel: 727-531-7068
Fax: 727-535-2068
Email: jake@jakeblanchardlaw.com
Total Assets: $153,366
Total Liabilities: $1,596,934
The petition was signed by Nicholas J. Angelastro as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 11 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/7WS47BY/The_A_Men_of_Sarasota_Inc__flmbke-22-02849__0001.0.pdf?mcid=tGE4TAMA
AGILE THERAPEUTICS: Lind Global Entities Report 9.9% Equity Stake
-----------------------------------------------------------------
In a Schedule 13G filed with the Securiteis and Exchange
Commission, these entities reported beneficial ownership of shares
of common stock of Agile Therapeutics, Inc. as of July 6, 2022:
Shares Percent
Beneficially of
Reporting Person Owned Class
---------------- ------------ --------
Lind Global Fund II LP 3,250,223 9.9%
Lind Global Partners II LLC 3,250,223 9.9%
Jeff Easton 3,250,223 9.9%
Jeff Easton, the managing member of Lind Global Partners II LLC,
may be deemed to have sole voting and dispositive power with
respect to the shares held by Lind Global Fund II LP.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/1261249/000092963822001145/sched13g.htm
About Agile Therapeutics
Agile Therapeutics, Inc. is a women's healthcare company dedicated
to fulfilling the unmet health needs of today's women. The
Company's product and product candidates are designed to provide
women with contraceptive options that offer freedom from taking a
daily pill, without committing to a longer-acting method. Its
initial product, Twirla, (levonorgestrel and ethinyl estradiol), a
transdermal system, is a non-daily prescription contraceptive.
Agile reported a net loss of $74.89 million for the year ended Dec.
31, 2021, a net loss of $51.85 million for the year ended Dec. 31,
2020, and a net loss of $18.61 million for the year ended Dec. 31,
2019. As of March 31, 2022, the Company had $29.30 million in total
assets, $26.56 million in total liabilities, and $2.74 million in
total stockholders' equity.
Iselin, New Jersey-based Ernst & Young LLP, the Company's auditor
since 2010, issued a "going concern" qualification in its report
dated March 30, 2022, citing that the Company has generated losses
since inception, used substantial cash in operations, anticipates
it will continue to incur net losses for the foreseeable future,
requires additional capital to fund its operating needs and has
stated that substantial doubt exists about the Company's ability to
continue as a going concern.
AKOUSTIS TECHNOLOGIES: Signs Separation Agreement With Former CPO
-----------------------------------------------------------------
Rohan Houlden's responsibilities as Akoustis Technologies, Inc.'s
chief product officer of Akoustis, Inc., a wholly-owned subsidiary
of Akoustis Technologies, Inc., ended and Mr. Houlden began a new
role as a strategic advisor to the Company's chief executive
officer.
In connection with this change in role, Akoustis and Mr. Houlden
entered into a Separation Agreement & Release and an Independent
Contractor Agreement pursuant to which Mr. Houlden will continue
serving Akoustis as an independent contractor following the end of
his employment. Under the Contractor Agreement, (i) Mr. Houlden
will receive $8,333.33 per month in respect of his consulting
services to Akoustis during the first three months of the term of
the agreement, and thereafter will be compensated as a rate of $175
per hour up to a maximum of $8,333.33 per month, (ii) subject to
the Contractor Agreement not previously having been terminated, Mr.
Houlden will receive a payment in an amount equal to Mr. Houlden's
bonus for fiscal year 2022 that he would have earned had he
remained an employee of Akoustis, and (iii) all outstanding
options, restricted stock units, restricted stock awards or other
grants of equity-based compensation to Mr. Houlden under the
Company's stock incentive plans will remain outstanding and
continue to vest in accordance with their terms for so long as Mr.
Houlden provides services under the Contractor Agreement. The
Contractor Agreement has an initial term of two months and is
automatically renewed on a month-to-month basis thereafter until
terminated by either party upon 30 days' notice and includes
certain non-competition and confidentiality obligations that
survive such termination. Under the Separation Agreement, Mr.
Houlden agreed to a release of claims in favor of Akoustis and its
affiliates. The Company thanks Mr. Houlden for his many
contributions and years of past service.
Effective July 8, 2022, the Company appointed Kamran Cheema as its
chief product officer. Mr. Cheema has served as the Company's vice
president of Engineering since August 2021 and provides 30 years of
experience in micro-acoustic technology. Mr. Cheema will guide the
device engineering and product design teams as well as the testing,
characterization, and mechanical design of Akoustis products for
all end markets, including 5G mobile, 5G infrastructure, Wi-Fi, and
other markets.
Before joining Akoustis, Mr. Cheema was the vice president of
Engineering at Qualcomm RF360, where he was responsible for all
aspects of micro-acoustic hardware solutions for the mobile phone
market. Prior to Qualcomm, Mr. Cheema was the vice president of
Engineering and site manager at TDK, where he reported directly to
the CEO. At TDK, he led a team of professionals, including filter
module and switch designers, SAW and BAW filter designers, and
laminate and LTCC specialists. Earlier, Mr. Cheema worked at
TriQuint Semiconductor, now part of Qorvo, as a Director of
Engineering where he led the development of acoustic RF filter
diplexers, the RF module team, GaAs pHEMT and SOI switch
development. Mr. Cheema holds a MSEE from the University of
Central Florida.
About Akoustis Technologies
Headquartered in Huntersville, NC, Akoustis is focused on
developing, designing, and manufacturing innovative RF filter
products for the mobile wireless device industry, including for
products such as smartphones and tablets, cellular infrastructure
equipment, and WiFi premise equipment.
Akoustis reported a net loss of $44.16 million for the year ended
June 30, 2021, a net loss of $36.14 million for the year ended June
30, 2020, and a net loss of $29.25 million for the year ended June
30, 2019. As of March 31, 2022, the Company had $132.09 million in
total assets, $13.65 million in total liabilities, and $118.44
million in total equity.
ALLIANCE RESOURCE: S&P Alters Outlook to Pos., Affirms 'B+' ICR
---------------------------------------------------------------
S&P Global Ratings affirmed its issuer credit rating on U.S.
thermal coal producer Alliance Resource Partners L.P. at 'B+' and
revised its outlook to positive from stable.
The positive outlook reflects S&P's expectation that Alliance will
continue to generate strong earnings, which could provide
opportunities to bolster liquidity and potentially address its
upcoming maturity.
S&P said, "We expect Alliance's adjusted leverage will improve on
account of lower debt and stronger expected earnings. S&P Global
Ratings believes Alliance could sustain adjusted debt to EBITDA of
1x by end of fiscal 2022, which compares favorably with its prior
expectation of about 2x. Our leverage calculation incorporates a
decrease of $172 million in Alliance's adjusted debt in the past 15
months. In addition to amortizations on various equipment financing
arrangements, the company repaid all borrowings (about $143
million) under its revolving credit facility (RCF) and asset
securitization facility. We also expect the company's earnings will
continue to increase if strong demand and favorable commodity
prices persist, leading to our expectation of EBITDA of $700
million-$1 billion in 2022 and $600 million-$800 million in 2023.
We assume that average realized price per ton for coal will
increase by 20%-30% as energy security concerns in Europe and some
parts of Asia amid supply tightness cause international thermal
coal prices to remain elevated.
"Domestic power providers continue to replenish low inventories
following increased power generation from coal plants as natural
gas prices remain very high, above $6/mmBtu. We expect tons sold
will increase by about 12% to 36 million tons in fiscal 2022. We
also expect increased royalty revenues from the company's oil and
gas and coal mineral interests as oil prices also remain elevated,
exacerbated by the Russian-Ukraine conflict."
Still, Alliance faces a call on cash for its upcoming 2025 notes
maturity. Alliance has a $400 million notes maturity due in 2025 at
a time when coal companies continue to lack access to a wide
breadth of capital providers, given the industry's overarching
environmental, social, and governance (ESG) concerns. Despite this
large maturity, Alliance has also committed to dispense significant
cash back to shareholders in fiscal 2022. The company plans to
increase cash distributions by 10%-15% every quarter over the rest
of 2022. This compares negatively with other coal companies that
have prioritized cash flows for debt repayment (for example,
setting up a sinking fund) over shareholder distributions.
Furthermore, the company plans to continue with meaningful capital
expenditures (capex) of about $200 million-$250 million in the next
year. Capex includes about $90 million earmarked for investments in
growth assets. These investments include renewable energy and
technology development through the company's Matrix Design Group
subsidiary and represent ongoing long-term diversification efforts
by the partnership as it invests in developing energy transition
areas. S&P said, "We believe that liquidity could come under
pressure in the next year or two as the 2025 maturity approaches,
should management prioritize cash flows for shareholder rewards or
heavy capital spending over debt repayment. Similarly, we would
view reduction in gross debt as an aid in mitigating the volatility
of the coal industry."
S&P said, "Our assessment continues to incorporate our view of the
long-term secular decline of thermal coal despite the current
strong market dynamics. We expect ESG factors will continue to
drive the early retirement of many coal generation plants in the
next decade or two. U.S. investor-owned power utilities have been
seeking investments in other power sources, with many constructing
natural gas-fired and renewable generation sources as a replacement
for coal plants. We believe the rating on Alliance is meaningfully
exposed to this ESG risk, as about 82% of coal tonnage was
purchased by U.S electric utilities in 2021. More recently,
domestic demand has strengthened in the face of higher natural gas
prices, exacerbated by the quest for energy independence in Europe
as countries seek to wean themselves off Russian natural gas. The
situation has forced domestic utilities to replenish coal
inventories to meet increasing demand for power this summer and
ahead of the upcoming winter. Some coal companies have leveraged
the current supply tightness to secure longer-term contracts,
providing some security for domestic power producers. We believe
this trend may be short lived, as we expect increasing government
regulation and investor pressures will continue to spur the
adoption of cleaner energy sources. Therefore, our final assessment
results in a credit rating that is one notch lower than warranted
by the combination of Alliance's business and financial risk
profiles.
"The positive outlook reflects our expectation that the company
will continue to generate solid earnings, which could create an
opportunity to strengthen liquidity ahead of its 2025 maturity. We
believe that Alliance can sustain adjusted leverage below 1.5x
based on a strong contracted position for fiscal 2022 and our
expectation of contract renewals at higher prices for fiscal 2023.
"We could raise our ratings on Alliance in the next 12 months if
the company were to successfully mitigate the risk of its upcoming
2025 notes maturity. We continue to believe that ESG factors will
continue to limit access to financing. A decrease in gross debt (or
a solid plan to do so) would also offset some of the inherent cash
flow volatility associated with the company's thermal coal
business. In our ongoing assessment, we would also look for more
clarity on the company's financial policy, specifically its plans
for cash deployment and shareholder distributions.
We could revise our outlook back to stable should the company not
make strides to address its upcoming maturity over the next 12
months. This could take form in financial policy decisions that
prioritize shareholder rewards over cash retention. Similarly, we
could revise our outlook on Alliance if domestic thermal coal
market conditions deteriorated, causing volumes and average
realized coal price to both decline by 8%-10%. This would result in
adjusted leverage close to 2x."
ESG credit indicators: E-5, S-3, G-2
S&P said, "Environmental factors are a very negative consideration
in our credit rating analysis of Alliance Resource Partners, since
its U.S. utility customers are on a steady path to reaching net
zero GHG emissions over the next couple of decades. We expect
renewable and natural gas power generation will continue to
displace coal-fired generation in the U.S. Alliance is a pure-play
thermal coal producer in the U.S. selling primarily to domestic
utilities. Alliance could face limited access to capital markets
because major financial and investment companies have decreased or
committed to divest their coal investments on ESG considerations.
Social factors are a moderately negative consideration, since the
company has to comply with stringent environmental and safety
regulations and is obligated to satisfy reclamation and other
long-term obligations related to coal mining. Partially offsetting
the risk of credit deterioration in the near term is Alliance's
conservative financial policy and low-cost, high-quality asset
base."
AMERICAN SLEEP: Unsecureds to Get $7K per Month for 60 Months
-------------------------------------------------------------
American Sleep Medicine LLC submitted a Chapter 11 Second Amended
and Restated Disclosure Statement on behalf of Chapter 11 Plan
dated July 12, 2022.
The plan is a plan of reorganization. In other words, the Proponent
seeks to accomplish payments under the Plan through income as sleep
diagnostic center. The Effective Date of the proposed Plan is 45
days after confirmation.
The Debtor, immediately with the filing of the bankruptcy petition
filed an adversary proceeding with its payroll provider. This
adversary proceeding was resolved with the release of all of the
financial information.
As part of the first day motions, the Debtor filed a motion for the
use of ServisFirst cash collateral. ServisFirst agreed to three
interim cash collateral order. After a long term arrangement could
not be reached with ServisFirst as well as three cash collateral
extensions, ServisFirst filed a motion for relief from stay to
recover its collateral. ServisFirst was successful in that action,
and the Debtor fully paid ServisFirst in this case.
The Debtor also rejected several leases and closed underperforming
Sleep Apnea centers. The Debtor has already rejected the leases
with TCP Partners in Orange County, Simon Levi Company, LTD in San
Diego, IN-9240 Meridian, LLC in Indianapolix, Hoffman Development
Co in St. Louis. Upon Confirmation of the plan, the leases in
Birmingham, Ala and Vienna, Virginia will also be rejected. All
other leases are assumed under the amended terms negotiated with
the Debtor. Currently, there are other no adversary proceedings
pending.
Class 1 consists of the secured claim of the Court approved post
petiton DIP financing to Row Zadek et al, an order entered on
November 30, 2021 shall be paid in full under the terms and
conditions of the promissory note entered at that time. This is an
insider loan to the principals of the Debtor, which is currently
not being paid or enforced.
Class 2 consists of General unsecured claims. The Debtor shall pay
$7,250.00 per month for a period of no less than 60 months.
Creditors in this class shall receive their pro rata distribution
under the plan and no less than 25% of the allowed amount of their
claim.
The Plan will be funded from income of the Debtor as a sleep
medicine treatment center.
A full-text copy of the Second Amended Disclosure Statement dated
July 12, 2022, is available at https://bit.ly/3PyBTFW from
PacerMonitor.com at no charge.
Counsel to the Debtor:
STEVEN L. LEFKOVITZ
618 Church Street, Suite 410
Nashville, TN 37219
Phone: (615) 256-8300
Fax: (615) 255-4516
Email: slefkovitz@lefkovitz.com
About American Sleep Medicine
American Sleep Medicine, LLC, filed a petition for Chapter 11
protection (Bankr. M.D. Tenn. Case No. 21-02741) on Sept. 8, 2021,
listing up to $50,000 in assets and up to $500,000 in liabilities.
Jerry Lauch, president of American Sleep Medicine, signed the
petition.
Judge Charles M. Walker oversees the case.
Steven L. Lefkovitz, Esq., at Lefkovitz and Lefkovitz is the
Debtor's legal counsel. ServisFirst Bank, as lender, is
represented by Austin L. McMullen, Esq. at Bradley Arant Boult
Cummings LLP.
ARCHBISHOP OF AGANA: Amends Plan to Include Other Abuse Claims
--------------------------------------------------------------
The Archbishop of Agana and the Official Committee of Unsecured
Creditors submitted a Second Amended Joint Disclosure Statement for
the Second Amended Joint Chapter 11 Plan of Reorganization dated
July 12, 2022.
The Plan is based on seven methods of funding. The first method of
funding is through the transfer of certain of the Debtor's real
property to a Trust, and the subsequent sale of that real property
to generate cash. The Plan Proponents estimate that the properties
identified to be sold have an estimated value of $18,358,034, but
the actual value is determined by the real property market in Guam
when the Trustee of the Trust chooses to sell the individual
parcels. Based on the variability of real property prices, the Plan
Proponents estimate the value of the real property could reasonably
vary anywhere between $16,500,000.00 and $23,000,000.00 based on
expected market.
Secondly, the Debtor will contribute $6,609,998.29 in cash
currently held in its bank accounts to fund the Trust.
Third, the Plan will be funded by the Debtor's insurance companies.
The Plan Proponents have reached a settlement with one of the
Debtor's insurers, National Union, for $18,000,000.00, which
settlement will fund the Trust. In addition, the Debtor will
transfer its rights to insurance to a trust established for Tort
Claimants and the Trust will litigate to obtain judgments against
the non-settling insurance companies or, alternatively, the
Debtor's remaining insurance companies will settle with the Trust
for up to $9.3 million related to the Debtor's direct insurance
policies and $55 million related to policies issued to the Boy
Scouts of America.
Fourth, the Debtor will contribute an initial amount of
$200,000.00, funding to the Unknown Tort Claim reserve, which funds
will be used to pay claims by Tort Claimants who qualify as Unknown
Tort Claimants, with the Reorganized Debtor renewing the Unknown
Tort Claim Reserve until a maximum of $1,500,000.00, or whatever
amount is ultimately determined by the Unknown Claims
Representative, is paid to all Unknown Tort Claimants over a
five-year period. Unused amounts shall be returned to the
Reorganized Debtor.
Fifth, Debtor will market and sell, the advice and consent of the
Committee, the FHP/TakeCare Real Property and Chancery Real
Property. The proceeds of the sale will be used as follows (i) to
fund the treatment of the Class 7 Claim, (ii) up to $250,000.00 to
fund Administrative Claims, (iii) up to $500,000.00 to renovate and
outfit the Cathedral for use as the Reorganized Debtor's
headquarters and Chancery office and moving expenses, (iv)
$200,000.00 to fund the Unknown Tort Claim Reserve, and (v) after
the payment of the amounts in (i)-(iv) the remaining proceeds will
be distributed to the trust.
Sixth, the Debtor will provide 50 single-vault ground plot easement
rights at the Pigo Catholic Cemetery. The plots will be set aside
from the current ground inventory. The fifty easement rights
currently have a cash value of approximately $332,500. The fifty
easement rights are nontransferable. A contract will need to be
entered into by the Tort Claimant in the Cemeteries, and the
easement amount would be waived on the contract. Such contracts are
exclusive of the opening/closing fees and standard marker, which
under these contracts are collected at the time of need. The ground
plot easement rights will be distributed to Holders of Class 3
Claims pursuant to the Trust Distribution Plan.
Seventh, the Debtor will provide, for a period of 10 years, three
vouchers per Archdiocesan elementary school will be issued annually
that will encompass grades K through 8th. Such vouchers are
non-transferable and will be awarded only to a student related to a
survivor. For a period of 10 years, two vouchers per Archdiocesan
high school will be issued annually that will encompass 9th through
12th grade. Such vouchers are non transferable and will be awarded
only to a student related to a survivor. The vouchers will be
distributed to Holders of Class 3 Claims pursuant to Trust
Distribution Plan.
Thus, between the various forms of funding for the Plan, it is
expected the Tort Claimants will receive the grand total sum of
between $37,019,033.00 and $101,000,000.00, which will be payable
to the trust set up through the Plan and Disclosure Statement
process. These funds will be allocated pursuant to the Trust
Distribution Protocols attached to the Trust Agreement. In
addition, a fund in an amount to be determined will be established
by the Reorganized Debtor to pay Unknown Tort Claimants pursuant to
the Plan, the Trust Distribution Protocols, and the Trust.
Class 12 consists of non-contingent Claims, which were allowed on
or before the Confirmation Date, for contribution, indemnity,
equitable indemnity, subrogation, or equitable subrogation, or
reimbursement, or any other indirect or derivative recovery, by any
Person or Entity against a Protected Party, which Claim relates to
or arises from Abuse. No Claim allowed after entry of the
Confirmation Order shall be a Class 12 Claim, but may still qualify
as a Claim in Class 10 or Class 11. The Trust shall pay any allowed
Class 12 Claim in full and shall make a dollar-for dollar reduction
to the award(s) of the Class 3 or Class 4 Claimant(s) for which the
Class 12 Claim relates.
Like in the prior iteration of the Plan, each holder of a Class 5
General Unsecured Claims will receive, directly from the
Reorganized Debtor, payment in full of such allowed Class 5 Claim,
without interest, on the Effective Date.
A full-text copy of the Second Amended Joint Disclosure Statement
dated July 12, 2022, is available at https://bit.ly/3PAwRZB from
PacerMonitor.com at no charge.
Attorneys for the Official Committee of Unsecured Creditors for the
Archbishop of Agana:
Robert T. Kugler, Esq.
Edwin H. Caldie, Esq.
Andrew J. Glasnovich, Esq.
STINSON, LLP
50 South Sixth Street, Suite 2600
Minneapolis, MN 55402
Telephone: 612-335-1500
Facsimile: 612-335-1657
E-mail: robert.kugler@stinson.com
ed.caldie@stinson.com
drew.glasnovich@stinson.com
Attorneys for the Debtor:
Ford Elsaesser, Esq.
Bruce A. Anderson, Esq.
ELSAESSER ANDERSON, CHTD.
320 East Neider Avenue, Suite 102
Coeur d'Alene, ID 83815
Tel: (208) 667-2900
Fax: (208) 667-2150
E-mail: ford@eaidaho.com
brucea@eaidaho.com
John C. Terlaje, Esq.
LAW OFFICE OF JOHN C. TERLAJE
Terlaje Professional Bldg., Suite 216, 194 Hernan Cortez
Ave.
Hagatna, Guam 96910
Tel: (671) 477-8894/5
E-mail: john@terlaje.net
About Archbishop of Agana
Roman Catholic Archdiocese of Agana -- https://www.aganaarch.org/
-- is an ecclesiastical territory or diocese of the Catholic Church
in the United States. It comprises the United States dependency
of Guam. The Diocese of Agana was established on Oct. 14, 1965, as
a suffragan of the Archdiocese of San Francisco, California. It
is a tax-exempt entity (as described in 26 U.S.C. Section 501).
The Archbishop of Agana, also known as the Roman Catholic
Archdiocese of Agana, sought Chapter 11 protection (D. Guam Case
No. 19-00010) on Jan. 16, 2019. Rev. Archbishop Michael Jude
Byrnes, S.T.D., Archbishop of Agana, signed the petition. The
Archdiocese scheduled $22,962,686 in assets and $45,662,941 in
liabilities as of the bankruptcy filing.
The Hon. Frances M. Tydingco-Gatewood is the case judge.
The archdiocese tapped Elsaesser Anderson, Chtd. as bankruptcy
counsel, Deloitte & Touche, LLP as human resource consultant, and
Pacific Human Resource Services, Inc. as accountant. Blank Rome
LLP, LegalWorks Apostolate PLLC, Davis & Davis P.C., and Camacho
Calvo Law Group serve as the archdiocese's special counsels.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on March 6, 2019. Stinson Leonard Street LLP,
The Law Offices of William Gavras, and Hiller Law, LLC serve as the
committee's bankruptcy counsel, local counsel, and special counsel,
respectively.
ARMSTRONG FLOORING: Reaches Agreement to Preserve Jobs In Lancaster
-------------------------------------------------------------------
Daniel Urie of PennLive reports that Lancaster County,
Pennsylvania-based Armstrong Flooring announced on Sunday afternoon
that it has entered into an agreement that is expected to save
hundreds of jobs in Lancaster County.
Armstrong Flooring has entered into a binding asset purchase
agreement with AHF and Gordon Brothers.
The consortium will acquire substantially all of Armstrong Flooring
Inc.'s North American assets for $107 million in cash and
assumption of specified assumed liabilities.
Armstrong Flooring had previously filed for Chapter 11 bankruptcy.
The court-supervised auction began on June 27, and the bid by the
AHF and Gordon Brothers consortium was the sole binding bid
received for substantially all of the company's North American
assets. The proposed transaction is subject to Bankruptcy Court
approval, as well as regulatory approvals and customary closing
conditions.
About American Flooring
Armstrong Flooring, Inc. (NYSE: AFI) --
https://www.armstrongflooring.com/ -- is a leading global
manufacturer of flooring products and one of the industry's most
trusted and celebrated brands. The company continually builds on
its resilient, 150-year legacy by delivering on its mission to
create a stronger future for customers through adaptive and
inventive solutions. Headquartered in Lancaster, Pennsylvania,
Armstrong Flooring safely and responsibly operates eight
manufacturing facilities globally.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 22-10426) on May 8, 2022.
In the petition signed by Michel S. Vermette, president and chief
executive officer, the Debtor disclosed $517,000,000 in assets and
$317,800,000 in liabilities.
Judge Mary F. Walrath oversees the case.
Skadden, Arps, Slate, Meagher and Flom, LLP is the Debtor's
counsel. Riveron Consulting, LP is the financial advisor, Houlihan
Lokey is the investment banker, and Epiq Corporate Restructuring,
LLC, is the claims and noticing agent and administrative advisor.
ASTECH ENGINEERED: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: ASTECH Engineered Products, Inc.
3030 Red Hill Avenue
Santa Ana, CA 92705
Chapter 11 Petition Date: July 15, 2022
Court: United States Bankruptcy Court
District of Delaware
Case No.: 22-10635
Judge: Hon. Brendan Linehan Shannon
Debtor's Counsel: Thomas M. Horan, Esq.
COZEN O'CONNOR
1201 North Market Street, Suite 1001
Wilmington, DE 19801
Tel: (302) 295-2045
Fax: (302) 295-2013
Email: thoran@cozen.com
- and -
BROOKS WILKINS SHARKEY & TURCO PLLC
401 S. Old Woodward Avenue
Suite 400
Birmingham, MI 48009
Total Assets as of June 30, 2022: $23,607,098
Total Liabilities as of June 30, 2022: $6,449,861
The petition was signed by David Richeson as executive chairman.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/ZJ4LQ5Y/ASTECH_Engineered_Products_Inc__debke-22-10635__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's Twenty Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Cadence Aerosapce-QFI OPS $18,073
Quality Forming, LLC
22906 Frampton Ave.
Torrance, CA 90501
2. Frisa Aerospace $365,372
Global Corporate
Advisors Inc.
1013 Centre Road
Ste. 403S
Wilmington, DE 19805
3. GKN Assumed $1,232,302
1150 W Bradley Ave Liabilities
El Cajon, CA 92021
4. GKN $109,673
Chem-Tronics
RU2012
1150 W Bradley Ave
El Cajon, CA 92021
5. Grainger, Inc. $189,448
(Santa Ana)
100 Grainger Pkwy
14441 West Illinois
Route 60
Lake Forest, IL 60045
6. Gulyas, Scott R $20,528
7. Haynes International Inc. $80,457
35082 Eagle Way
Chicago, IL
60678-1350
8. Jacobs, Susan E $18,173
9. JPR-Hutchinson $17,070
Aerospace
22 Rue Andre
Durouchez
80115 Amiens
France
10. Lalonde, Suzanne M $18,912
11. Laser Industries, Inc. $50,756
1351 Manhattan Ave.
Fullerton, CA 92831
12. May, Ricky L $20,919
13. McConnell, Kevin J $32,587
14. Morson International $321,931
10800 Gosling Rd.
Box #131565
Spring, TX 77393
15. Paynter, William J $20,404
16. PCC-Schlosser PCC $32,133
Structurals, Inc.
National Registered Agents, Inc.
330 N Brand Blvd
Ste 700
Glendale, CA 91203
17. Precision Aerospace Corp. $26,709
11155 Jersey Blvd.
Ste. A
Rancho Cucamonga, CA
91730
18. Precision Machined $22,811
Prod LLC
1017 Smithfield Drive
Fort Collins, CA 80524
19. Talentcore, Inc. $39,094
3429 Lomas
Serenas Drive
Escondido, CA 92029
20. Wesco Aircraft, Inc. $39,351
CT Corporation System
1999 Bryan St.
Ste. 900
Dallas, TX 75201
BAMC DEVELOPMENT: Unsecureds Will Get 100% of Claims in Plan
------------------------------------------------------------
BAMC Development Holding, LLC, filed with the U.S. Bankruptcy Court
for the Middle District of Florida a Disclosure Statement
describing Chapter 11 Plan of Reorganization dated July 12, 2022.
The Debtor is in the business leasing a single parcel of real
property ("Property"), for parking and as a residence, which the
Debtor owns in fee simple. The Debtor was formed as a Florida
limited liability company on September 7, 2005.
The Debtor has been is a party to a certain OPTION EXECRCISE AND
CH. 11 PLAN SPONSOR AGREEMENT with Tampa Hyde Park Cafe Properties,
LLC ("THPCPR") ("Option"). By the Option, THPCPR, or its assignee,
CPT Acquisitions, LLC (collectively "THPCP") has the absolute right
to acquire the Property for the sum of $200,000.00, minus the sum
of $20,000.00 paid by THPCPR upon exercise of the Option.
Also under the Option, the Debtor has the right to sell the
Property pursuant to a chapter 11 plan free and clear of liens,
under Bankruptcy Case § 363, to an entity known as Copperline
Partners, LLC, a Delaware limited liability company. Also, THPCP
has agreed to fund up to $50,000.00 to the Debtor's Plan by
contributing funds to pay administrative expenses, adequate
protection payments and plan payments, contingent on the
confirmation of a chapter 11 plan.
Finally, if a plan is confirmed, the Debtor and THPCP will share
50/50 in certain air rights reserved in the Purchase Agreement and
a development to be completed pursuant to such reservation of air
rights. The Debtor has been involved in negotiations with
Copperline for execution of an "As Is Real Estate Purchase
Agreement" ("Purchase Agreement").
The Plan provides for the satisfaction of the allowed amount of
Wilmington's senior lien of $300,000.00 in full. The amount of the
liens created by these judgments far exceed the value of the
Property. Therefore, a sale in this chapter 11 case under
Bankruptcy Code, § 363 free and clear of claims is the only way to
sell the Property. The Debtor believes this is the most equitable
result as to all of the Debtor's creditors, and in order to
accomplish this result, the Debtor filed this chapter 11 case.
Class 5 consists of General Unsecured Claims. The Debtor believes
there will be a total of $5,182.00 in allowed general unsecured
claims. The holders of claims in this class will receive
installment payments of an amount equal to 100% of the allowed
amount of such holder's claim, in 12 equal installments, without
interest beginning on the first business day of the month
immediately after the effective date of the Plan.
Class 6 consists of Unsecured Convenience Claims. The holders of
claims in this class are holders of allowed unsecured claims equal
to $1,000.00 or less. The holder of any allowed general unsecured
claim may elect to reduce such claim to $1,000.00 and be treated in
this class. The holders of allowed claims in this class will
receive a onetime payment on the day which falls 30 days after the
effective date of the Plan equal to 100% of the allowed amount of
such claim. Any holder of an allowed general unsecured claim who
elects to reduce such claim to $1,000.00 will be deemed to have
voted to accept the Plan.
Class 7 consists of Equity Interest of Thomas Ortiz. The equity
interest of Thomas Ortiz, equal to a 100% interest in the Debtor,
shall be re vested in full upon confirmation, in return for an
equity contribution in the amount necessary, in excess of cash
available on the effective date of the Plan, and amounts to be
funded by THPCP to fund the initial payments due under the Plan and
additionally new equity contributions necessary to pay payments due
under the Plan, as new equity and new value for purposes of the
absolute priority rule.
Specifically, Thomas Ortiz shall contribute any funds necessary to
pay Wilmington's claim if the proceeds from closing of a purchase
agreement and contributions from thPCP are not sufficient.
Additionally, in the event funds contributed by THPCP are not
sufficient, Thomas Ortiz shall contribute all funds necessary to
fund plan payments and operating costs of the Debtor, including
payments of interest to Wilmington, payments for insurance on the
Property and real estate taxes, all pending a closing on a purchase
agreement.
The cash payments under this Plan have been and/or will be
generated from cash on hand on the Effective Date, rent earned from
the Property and contributions by THPCP. In the event THPCP fails
to fund the Plan, then such contributions will be funded by Thomas
Ortiz.
The Plan Proponent has provided projected financial information the
monthly post-confirmation cash flow projection. The Debtor believes
that with contributions from Thomas Ortiz there will be more than
sufficient income pending a closing on the Purchase Agreement, and
there will be no further need for reorganization of the Debtor.
A full-text copy of the Disclosure Statement dated July 12, 2022,
is available at https://bit.ly/3PyC9Vu from PacerMonitor.com at no
charge.
Attorney for Debtor:
Leon A. Williamson, Jr., Esq.
Law Office of Leon A. Williamson, Jr., P. A.
306 South Plant Ave., Suite B
Tampa, FL 33606
Tel: (813) 253-3109
Fax: (813) 253-3215
Email: Leon@LwilliamsonLaw.com
About BAMC Development Holding, LLC
BAMC Development Holding, LLC is a Florida limited liability
company that owns in fee simple a parcel of real property located
at 212 South Fremont Ave. in Tampa, Florida. The Property is
partially leased to a bar/cafe for parking and is sub-leased for
residential purposes.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-01487) on April 31,
2022. In the petition signed by Thomas Ortiz, managing member, the
Debtor disclosed up to $500,000 in assets and up to $10 million in
liabilities.
Judge Catherine Peek McEwen oversees the case.
Leon Williamson, Esq., at Law Office of Leon A. Williamson, Jr.,
P.A. is the Debtor's counsel.
BARTLEY INDUSTRIES: Valliance Says Plan Not Filed in Good Faith
---------------------------------------------------------------
Valliance Bank objects to the Fifth Amended Plan of Reorganization
filed by Debtor Bartley Industries, Inc. Dated June 16, 2022.
On November 4, 2021, Valliance filed a proof of claim [POC 8],
asserting a claim against the Debtor's estate in the amount of
$1,240,009.38 as of November 2, 2021.
Valliance points out that the Plan violates applicable bankruptcy
law by ignoring and improperly classifying Valliance's Claim.
Valliance holds both secured and unsecured claims. While the Plan
provides for Valliance's unsecured claim in Class 4, such
classification is improper. Under the guise of creating a
convenience class, the Debtor attempts to gerrymander Valliance's
unsecured deficiency claim in a separate class from other general
unsecured claims, which are placed in Class 3.
Valliance claims that the Plan lacks good faith in that the sole
purpose of the Plan appears to be to avoid Valliance's Claim.
Namely, the Plan proposes satisfying all other creditors in full.
The Plan's purpose of cutting out Valliance from the Plan cannot be
said to be in good faith. Accordingly, the Plan should not be
confirmed.
Valliance states that the Debtor has failed to establish that its
future business can generate profits sufficient to meet the Plan
obligations or that there will be any disposable income. Because
Valliance's treatment would be more favorable under a hypothetical
liquidation than under the Plan, the Plan fails to satisfy the best
interests of creditors test and cannot be confirmed.
Valliance says that the Plan also indicates that the Debtor is
estimated to have professional fee claims of $90,000.00, which are
to be paid on the Plan's effective date. The Debtor also estimates
priority tax claims of $5,279.21, which will also be paid on the
effective date if the taxing authorities do not accept the Plan.
The Debtor reports cash on hand of only $94,730.91, which is
insufficient to make the payments required on the effective date.
The Debtor fails to explain how it intends to fund this shortfall
or meet ongoing obligations after depletion of its cash.
Valliance asserts that the Debtor's financial struggles make the
Debtor extremely high risk. The Plan is not feasible, and the
Debtor's business is failing. Further, the Debtor is proposing a
lengthy term of five years to repay Valliance's secured claim,
further increasing the potential risk to Valliance. Given these
factors, a risk factor of 3% is appropriate. Because the proposed
interest rate is insufficient to satisfy Till, the Plan is not
confirmable.
Valliance further asserts that the Plan contains a provision that
wholly eliminates the discharge requirement, seemingly granting the
Debtor an immediate discharge of all liabilities. This provision
appears to eliminate all claims and liabilities of the Debtor,
except any payments provided for under the Plan. Because this
provision violates the Bankruptcy Code, the Plan cannot be
confirmed.
A full-text copy of Valliance's objection dated July 12, 2022, is
available at https://bit.ly/3aH6JNF from PacerMonitor.com at no
charge.
Attorneys for Valliance Bank:
Melvin R. McVay, Jr., Esq.
Clayton D. Ketter, Esq.
PHILLIPS MURRAH P.C.
Corporate Tower, 13th Floor
101 North Robinson Avenue
Oklahoma City, OK 73102
Telephone: (405) 235-4100
Fax: (405) 235-4133
Email: mrmcvay@phillipsmurrah.com
cdketter@phillipsmurrah.com
About Bartley Industries
Bartley Industries Inc., a company that offers electrical
maintenance, repair and installation services based in Norman
Okla., filed a petition for relief under Subchapter V of Chapter 11
of the Bankruptcy Code (Bankr. W.D. Okla. Case No. 21-12565) on
Sept. 25, 2021. In the petition signed by Donna Bartley,
president, the Debtor listed $1,733,842 in total assets and
$2,003,791 in total liabilities
The Law Offices of B. David Sisson serves as the Debtor's legal
counsel. Susan Regier, CPA of the firm Regier, Cox & Associates,
PLLC is the Debtor's accountant and financial consultant.
BASA INVESTMENTS: Amy Stanley Says Plan Not Filed in Good Faith
---------------------------------------------------------------
Creditor Amy Stanley objects to confirmation of the Fourth Amended
Plan of Reorganization of debtors Basa Investments, LLC, Shepherd
Realty Investments, Inc. and Damaca Investments, LLC.
Stanley claims that the Plan is not confirmable as it falls short
of the majority of Section 1129's requirements. The Plan
essentially provides the Debtors with the ability to default on the
Plan on day one with ostensibly either the Subchapter V trustee
only being entitled to turnover of cash on hand with simply an
accounting of anything remaining. Plan at p. 20. The alternative is
to seek remedies in state court. Id. at 20-21. This cannot be the
intent of Subchapter V.
Stanley states that the Plan proposes to sell two of the seven real
properties free and clear of Stanley's lis pendens, and to keep one
other free and clear of Stanley's lis pendens. This is flatly
contrary to Florida law and the State Court's order, and strips
Stanley of the rights afforded to her under Florida law on account
of that lis pendens, without any adjudication of her claims to
ownership in six, and secured claims against all seven. These Plan
provisions are material to the Plan, are the entire basis for the
Plan, and flatly amount to means forbidden by law.
Stanley asserts that the Plan comes nowhere close to being proposed
in good faith. On the good faith scale, the Plan is worse than the
last one. The Plan is for the benefit of Banegas and the handful of
non-consensual third party secured creditors Banegas has no choice
but to pay in full, and non-Stanley general unsecured creditors,
including Banegas' ex-wife's sister, Liliana Daza.
Stanley further asserts that the Plan has been proposed to provide
Banegas with the most valuable of the Debtors' seven properties in
terms of both the income it generates and its market value, and to
pay all creditors but Stanley with the next best two, and then make
Stanley fight for the four worst properties to potentially clear
the principal amount of her losses from 2017 and early 2018.
Additionally, the Plan permits Banegas to walk away with a piece of
real property with a $410,000 net value, while Stanley has to fight
to recover approximately the principal amount of what she expended
to acquire and to maintain all seven of these properties five years
ago against properties whose values will necessarily fluctuate and
likely fall (in light of Federal Reserve policy changes and a
looming recession) in the coming six months. The Debtors' entire
scheme of undervaluing Stanley's claim, removing the bulk of the
Debtors' assets from the estate, and forcing Stanley into more
litigation reflects the absence of any good faith.
Perhaps the most glaring evidence of lack of good faith is
reflected in the Debtors' liquidation analysis. The Debtors seems
to think they can use the estimated chapter 7 administrative
expenses upon a hypothetical conversion to justify taking that
estimated sum for themselves in a chapter 11, while not paying
creditors in full.
Stanley points out that the Debtor's conduct throughout this
Chapter 11 evidences a lack of good faith. But nothing in this
compares to what the Plan is attempting to do. The Plan proposed
for equity to walk away with about ¼ of the liquidation value of
the entire estate while leaving Stanley to fight for less than her
claim. The Plan places all but secured tax certificates at risk of
receiving nothing simply because Banegas wants it all for himself.
A full-text copy of Amy Stanley's objection dated July 11, 2022, is
available at https://bit.ly/3aBZoiz from PacerMonitor.com at no
charge.
Attorney for Amy Stanley:
FENDER, BOLLING, AND PAIVA, P.A.
G. STEVEN FENDER, ESQ.
Florida Bar No. 060992
PO. Box 1545
Ft. Lauderdale, FL 33302
Telephone: (407) 810-2458
Email: steven.fender@fender-law.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.
BITNILE HOLDINGS: Forms Ault Energy to Make Strategic Acquisitions
------------------------------------------------------------------
BitNile Holdings, Inc. has formed Ault Energy, LLC, a subsidiary of
Ault Alliance, Inc., itself a subsidiary of BitNile.
Background on Ault Energy's Oil and Gas Drilling Rights
* The Company recently completed its previously announced
transaction with Ecoark Holdings, Inc. by funding the purchase of
$12,000,000 of Series A Convertible Redeemable Preferred Stock of
Ecoark pursuant to the previously announced securities
purchase agreement between its wholly owned subsidiary Digital
Power Lending, LLC and Ecoark;
* The Agreement provides Ault Energy, as a designee of DPL, the
right to purchase up to 25% in various drilling projects of White
River Holdings Corp, a wholly owned subsidiary of Ecoark,
commencing in July 2022;
* White River may, in its sole discretion, allocate a greater
percentage to DPL or its designee than 25%; and
* Ault Energy's right to purchase a greater percentage than 25%
is subject to reaching a mutual agreement with White River.
Ault Energy Partnership with White River
Partnering with a vertically integrated operator such as White
River would provide Ault Energy with the opportunity to make oil
and gas acquisitions with a proven partner that has a leasehold of
ready-to-drill prospects in producing fields. Ault Energy has been
advised that White River currently owns a drilling rig that can
reach depths of up to 18,000 feet, as well as three workover rigs
for re-entry and completion procedures. Ault Energy and White
River have preliminary plans to drill at least 100 wells over the
next 60 months over the approximately 30,000 acres in Texas,
Louisiana and Mississippi that White River currently is leasing.
BitNile is encouraged by its discussions with White River and the
meaningful potential represented by this opportunity. Ault Energy
and White River currently expect to purchase up to two additional
drilling rigs this year to allow concurrent drilling projects going
forward, but there can be no assurance that these plans will
materialize during 2022, if at all. Ault Energy expects to
allocate significant capital over the next five years towards these
drilling projects.
The Company's Founder and Executive Chairman, Milton "Todd" Ault,
stated, "The formation of Ault Energy is the result of a long-term
goal to partner with an experienced, competent team to extract oil
in a location known for large oil reserves. We have confidence in
the team at Ecoark and White River and believe this is a great
opportunity to allocate capital towards oil and gas projects.
White River has successfully completed numerous wells including a
directional well in the Austin Chalk formation of Louisiana. As we
gather data from our drilling projects and third-party studies, we
plan to provide updates to our outlook on these initiatives."
Ecoark's Chairman and CEO, Randy May, stated, "The opportunity to
partner with Ault Energy will allow White River to greatly scale
its vertically integrated oil and gas exploration, production and
drilling operations. We are looking forward to aggressively
drilling out our leasehold over the coming months and years with
Ault Energy."
About BitNile Holdings
BitNile Holdings, Inc. (formerly known as Ault Global Holdings,
Inc.) is a diversified holding company pursuing growth by acquiring
undervalued businesses and disruptive technologies with a global
impact. Through its wholly and majority-owned subsidiaries and
strategic investments, the Company owns and operates a data center
at which it mines Bitcoin and provides mission-critical products
that support a diverse range of industries, including
defense/aerospace, industrial, automotive, telecommunications,
medical/biopharma, and textiles. In addition, the Company extends
credit to select entrepreneurial businesses through a licensed
lending subsidiary. BitNile's headquarters are located at 11411
Southern Highlands Parkway, Suite 240, Las Vegas, NV 89141;
www.BitNile.com.
BitNile reported a net loss of $23.97 million for the year ended
Dec. 31, 2021, a net loss of $32.73 million for the year ended Dec.
31, 2020, a net loss of $32.94 million for the year ended Dec. 31,
2019, and a net loss of $32.98 million for the year ended Dec. 31,
2018. As of March 31, 2022, the Company had $518.92 million in
total assets, $93.74 million in total liabilities, $116.73 million
in redeemable noncontrolling interests in equity of subsidiaries,
and $308.46 million in total stockholders' equity.
CAPSTONE GREEN: Appoints Scott Robinson as Interim CFO
------------------------------------------------------
The Board of Directors of Capstone Green Energy Corporation
appointed Scott Robinson as interim chief financial officer
(serving as the Company's principal financial officer and principal
accounting officer), treasurer and secretary of the Company,
effective on the first day following the CFO Transition Date, until
the position of chief financial officer, which is the subject of a
nationwide search, is permanently filled.
As previously announced, on June 20, 2022, Frederick S. Hencken
III, the current chief financial officer of Capstone Green Energy
Corporation, notified the Company of his resignation and of his
intentions to depart the Company on July 8, 2022. Mr. Hencken has
agreed to remain with the Company until the date the Company files
its Annual Report on Form 10-K for the fiscal year ended March 31,
2022 (the "CFO Transition Date").
Mr. Robinson, 67, currently serves as an executive consultant with
Vaco, LLC, a company that provides senior level financial
professionals on an interim basis. Prior to joining the Company,
Mr. Robinson served in executive finance and accounting positions
with various companies, including as CFO at Lear Capital, Inc. a
precious metals leader from 2012 until 2021, and as senior vice
president, Finance at JAKKS Pacific, Inc. (NASDAQ: JAKK), a global
publicly traded toy and consumer products company from 2004 until
2009. He was also previously the Director of Finance at the Walt
Disney Company. Mr. Robinson began his career as a senior
accountant and senior management consultant at Deloitte. Mr.
Robinson is a Certified Public Accountant (inactive), and a
graduate of the University of Southern California, with an MBA from
the University of California.
Effective July 8, 2022, the Company entered into an engagement
letter with Vaco, pursuant to which the Company will pay an hourly
rate of $240 directly to Vaco.
About Capstone Green Energy
Capstone Green Energy Corporation is a provider of customized
microgrid solutions and on-site energy technology systems focused
on helping customers around the globe meet their environmental,
energy savings, and resiliency goals. In April 2021, the Company
added additional products to its portfolio and shifted its focus to
four key business lines.
Capstone reported a net loss of $18.38 million for the year ended
March 31, 2021, a net loss of $21.90 million for the year ended
March 31, 2020, and a net loss of $16.66 million for the year ended
March 31, 2019. As of Sept. 30, 2020, the Company had $65.75
million in total assets, $56.90 million in total liabilities, and
$8.85 million in total stockholders' equity.
CENTURION PIPELINE: Fitch Affirms LT IDR at BB-, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has affirmed Centurion Pipeline Company LLC's
(Centurion) Long-Term Issuer Default Rating (IDR) at 'BB-'. The
Rating Outlook is Stable. Fitch has also affirmed the senior
secured term loan and revolver rating at 'BB+'/'RR1'.
Centurion's ratings reflect its modest size and scale, strong
liquidity, declining leverage and stable cash flows predominantly
underpinned by a long-term contract with its primary counterparty,
Occidental Petroleum Corporation (OXY; BB+/Positive). Ratings also
consider limited commodity price exposure through cash assurances
in the form of minimum revenue commitments (MRC) from OXY and
another investment grade counterparty.
Fitch views OXY's improving credit profile as a positive for
Centurion but ratings remain constrained due to counterparty
concentration, single-basin focus and lack of business line
diversity.
KEY RATING DRIVERS
Modest Size and Scale: Centurion's ratings recognize the limited
operational scale of the Permian basin focused crude gathering and
transportation service provider. Centurion's size and scale is
limited with EBITDA currently below $200 million. The size of
Centurion's operations limits the company's ratings as small
changes in revenue and/or expenses can have material impact on
financial metrics. Fitch views small scale, single-basin focused
midstream providers with high geographic, customer and business
line concentration as being exposed to outsized event risk should
there be another slowdown or long-term disruption of Permian basin
production.
Counterparty Exposure: Centurion derives a significant proportion
of its cash flows (46% for 2021) from OXY, which is its primary
counterparty on its system. Revenues from OXY are supported by
long-term contracts with some MRC's. In addition to its own
production, OXY also on-ships for others. Fitch notes that
Centurion has started diversifying its portfolio of revenue streams
from various other counterparties, (both investment grade and high
yield) with its new growth projects, thereby gradually reducing
proportion of its revenues from OXY. Fitch, however, expects OXY to
remain Centurion's largest customer over rating horizon as the
assets are critical to OXY's production in the Permian
Lack of Diversification: Centurion's assets and operations are
entirely focused in the Permian basin. The company derives a
significant portion of its cash flows from a single-asset located
in the Permian basin and extending northeast to Cushing, OK. While
the company has growth projects coming in-service in 2022 and 2023
independently through third party volumes, the asset base remains
focused in the Permian. Despite its presence in one of the most
prolific basins, given its single-basin focus and lack of business
line diversity, Centurion is exposed to event risk should there be
another slowdown in the basin. Furthermore, Centurion lacks
customer diversification given that OXY is expected to contribute a
meaningful proportion of its volumes.
Improving Leverage: Centurion is expected to operate with modest
leverage as volumes return to the system with improving macro
environment, supported in part by tariff escalators built into the
contracts. Fitch forecasts YE 2022 leverage between 2.6x-2.8x,
trending lower at YE 2023 between 2.2x-2.5x as new projects come on
line, barring unforeseen events such as increase in spending or
acquisitions. In the absence of any meaningful growth project
investment opportunities, capex is expected to be moderate over
rating horizon as the company focuses on incremental small
projects, funded primarily from cash flow. Centurion historically
maintained low leverage and strong interest and distribution
coverage relative to midstream peers. Fitch believes leverage is
critical to Centurion's credit profile in the absence of business
and geographic diversity.
Cash Flow Assurance: Centurion's operations are underpinned by
long-term agreements in place with OXY, which includes minimum
revenue commitment extending until 2029. Centurion also has a
long-term throughput and deficiency (T&D) agreement in place with
an investment-grade customer until 2024.
These minimum revenue commitments provide cash flow assurance with
some volumetric downside protection but these minimum revenue
commitments decline over the contract period. The new growth
projects including Augustus pipeline and its interest in
Wink-to-Webster are also supported by long-term take-or-pay
contracts from counterparties that are predominantly investment
grade. In addition, the Southeast New Mexico oil gathering system
has significant acreage dedication from OXY.
Sponsor Support: Lotus Midstream owned 100% of Centurion as of
March 2022. Lotus's sponsor, Encap Flatrock Midstream (EnCap)
committed equity for the purchase of OXY's pipeline assets in 2018
and continues to provide the company with assistance in gaining
insights into new areas. EnCap has supported Centurion's growth as
the company reinvests its cash flows into the business. Centurion
paid its first distribution to Encap in 2021 and in the absence of
any meaningful high-return reinvestment opportunities in the near
term, Fitch believes Centurion will have sufficient liquidity for
distributions to the sponsor. Fitch expect EnCap to remain
supportive of Centurion's operating profile in the near term.
DERIVATION SUMMARY
Centurion's rating is constrained by its size and lack of
geographic diversification. The company has significant customer
concentration, with OXY contributing nearly 46% of revenue for
fiscal 2021. The rating also reflects a substantial portion of cash
flows are generated from a single pipeline system, although the
company is now expanding with its investment in several small
growth projects and its 5% joint venture intertest in the
Wink-to-Webster pipeline.
Centurion is rated two notches below Hess Midstream Operations LP
(HESM OpCo; BB+/Positive). Both HESM OpCo and Centurion are single
basin midstream companies with concentrated counterparty risk. HESM
OpCo's parent is Hess Corporation (HES; BBB-/Positive). HESM OpCo
is located in the Bakken whereas Centurion is located in the
prolific Permian basin, which is witnessing a rebound in activity
and has some of the lowest break-even costs for crude.
HESM OpCo also receives protection from volume downside and other
risks from its investment-grade parent, HES in the form of some
minimum volume commitments (MVCs). Fitch estimated HESM OpCo's
leverage to be closer to 3.0x by YE 2022. This is higher than
Centurion's estimated YE 2022 leverage of 2.6x-2.8x. Centurion's
rating is, however, constrained by its small operational scale.
Centurion is rated higher than single-basin issuers such as
Medallion Midland Acquisition LLC (B+/Stable). This is due to
Centurion's lower leverage and minimum revenue commitments from OXY
and other investment-grade customers. Medallion has revenues
dependent on acreage dedication. Fitch projects YE 2022 leverage
for Medallion to be around 4.5x.
KEY ASSUMPTIONS
-- Fitch price deck for West Texas Intermediate (WTI) of $100/
barrel (bbl) in 2022, $81/bbl in 2023, $62/bbl in 2024 and
$50/bbl thereafter;
-- Growth projects proceed as planned and contracts commence by
YE 2022;
-- Contract counterparties with MRCs, MVCs or take-or-pay
commitments perform under their obligations;
-- Maintenance capex consistent with management guidance;
-- No asset sales or acquisitions;
-- Refinancing of 2023 revolving credit facilities with similar
terms.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- A significant increase in size, scale, and asset or business
line diversity;
-- A meaningful increase in counterparty diversification;
-- Expected Leverage (total debt with equity credit/operating
EBITDA) at or below 3.0x on a sustained basis.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Credit quality deterioration of its primary counterparty, OXY,
in the absence of any meaningful counterparty diversification;
-- A significant change in cash flow stability such as an
increase in cash flows from acreage dedications;
-- Leverage (total debt with equity credit/operating EBITDA) at
or above 3.5x on a sustained basis;
-- An increase in spending beyond Fitch's current expectations,
or acquisitions funded in a manner that pressures the balance
sheet;
-- Reduced liquidity and/or inability to refinance the secured
revolver maturing 2023 proactively.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Centurion had approximately $143.2 million
available liquidity as of March 31, 2022, including $0.1 million in
cash and cash equivalents. Centurion also has a credit facility,
which provides for a $350 million term loan B, $75 million term
loan B-1 and a $147.5million revolver. The revolver has a sublimit
of $25 million for LOC. As of March 31, 2022, there was $4.4
million borrowings outstanding under the revolving credit
facility.
Obligations under the credit facilities are secured by
substantially all tangible and intangible assets of the company.
The term loan has an annual amortization of one percent. The
existing and incremental senior secured term loan B-1, and secured
revolver rank pari passu.
Under the facility, Centurion is required to maintain two financial
covenants: (1) a debt service coverage ratio of at least 1.10x and
(2) net total leverage ratio not exceeding 4.75x. Centurion was in
compliance with the covenants as of March 31, 2022, and Fitch
expects the company to maintain compliance in the near term.
Debt Maturity Profile: The revolver matures in September 2023. The
senior secured term loans mature in September 2025.
ISSUER PROFILE
Centurion is a private midstream company sponsored by Encap
Flatrock Midstream (EnCap,) which owns and operates a crude oil
logistics business consisting of gathering and trunk pipelines that
extend from Southeast New Mexico across the Permian Basin of West
Texas to Cushing, OK. Centurion also has a combined storage
capacity of approximately seven million barrels including terminals
in Midland, TX and Cushing, OK.
SUMMARY OF FINANCIAL ADJUSTMENTS
Distributions from Centurion's interest in Wink to Webster pipeline
are included in EBITDA; and equity earnings from this joint venture
interest are excluded.
ESG CONSIDERATIONS
Centurion's ESG Relevance score for Group Structure and Financial
Transparency has changed from a '4' to a '3'. Centurion is a
private equity backed company. Timeliness and transparency in
financial and other disclosures have resulted in the revision of
the relevance score. This factor no longer has an impact on
ratings.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
DEBT RATING RECOVERY PRIOR
---- ------ -------- -----
Centurion
Pipeline Company
LLC LT IDR BB- Affirmed BB-
senior secured LT BB+ Affirmed RR1 BB+
CHRISTIAN CARE: Ferguson Braswell Represents Reinsman, 3 Others
---------------------------------------------------------------
In the Chapter 11 cases of Christian Care Centers, Inc. and
Christian Care Centers Foundation, Inc., the law firm of Ferguson
Braswell Fraser Kubasta submitted a verified statement under Rule
2019 of the Federal Rules of Bankruptcy Procedure, to disclose that
it is representing the following entities:
a. Reinsman Consulting, LLC, 6160 Warren Parkway, Suite 100,
Frisco, TX 75034;
b. FPR Holdings, L.P., 8221 Tristar Drive, Irving, TX 75063;
c. Freedom Financial Consulting, Inc., 8221 Tristar Drive,
Irving, TX 75063; and
d. Freedom Profit Recovery, Inc., 8221 Tristar Drive, Irving,
TX 75063.
Reinsman Consulting, LLC is party to an executory contract with
Debtor Christian Care Centers, Inc. and may hold one or more
unliquidated and/or contingent claims arising from
such agreement for tax consulting services.
Freedom Financial Consulting, Inc. and FPR Holdings, L.P. are
parties to an executory contract Debtor Christian Care Centers,
Inc. for the lease of office equipment, including copiers, printers
and related equipment for which there is an outstanding arrearage
of not less than $51,004.01
Each of the Clients have engaged the Firm to represent them in
connection with these jointly administered chapter 11 cases.
The interests held by each of the Clients did not arise in
connection with the Clients acting together pursuant to a committee
arrangement, either in the past or at this time.
Upon information and belief, the Firm does not possess any claims
against, or interests in, the Debtors.
Counsel for Reinsman Consulting, LLC, FPR Holdings, L.P., Freedom
Financial Consulting, Inc., and Freedom Profit Recovery, Inc. can
be reached at:
Rachael L. Smiley, Esq.
FERGUSON BRASWELL FRASER KUBASTA PC
2500 Dallas Parkway, Suite 600
Plano, TX 75093
Telephone: 972-378-9111
Facsimile: 972-378-9115
E-mail: rsmiley@fbfk.law
A copy of the Rule 2019 filing is available at
https://bit.ly/3cdfcbR at no extra charge.
About Christian Care Centers
Christian Care Centers, Inc. (CCCI) was incorporated in 1947 as a
nonprofit Texas corporation. CCCI, a faith-based organization,
operates three senior living housing and health care campuses in
the Dallas/Fort Worth Metroplex. In addition, CCCI owns unimproved
real property in Dallas County and Tarrant County, adjacent to the
Mesquite and Fort Worth communities.
Meanwhile, Christian Care Centers Foundation, Inc. was incorporated
in 1994 also as a nonprofit Texas corporation. It is a supporting
organization that serves as an endowment organization for CCCI.
CCCI and Christian Care Centers Foundation sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. N.D. Texas Lead Case
No. 22-80000) on May 23, 2022. In the petitions signed by Mark
Shapiro, chief restructuring officer, the Debtors disclosed up to
$100 million in both assets and liabilities.
Judge Stacey G. Jernigan oversees the cases.
The Debtors tapped Husch Blackwell, LLP as counsel; Glassratner
Advisory & Capital, LLC as restructuring advisor; and Houlihan
Lokey Capital, Inc. as investment banker. Epiq Corporate
Restructuring, LLC is the claims, noticing, and solicitation
agent.
The U.S. Trustee for Region 6 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on June 3,
2022. The committee is represented by Kane Russell Coleman Logan,
P.C.
CHUB CAY: Seeks Approval to Hire Villa & White as Counsel
---------------------------------------------------------
Chub Cay LLC seeks approval from the U.S. Bankruptcy Court for the
Western District of Texas to hire Villa & White, LLP as its legal
counsel.
The firm's services include:
(a) assisting and advising the Debtor relative to its
operations and to the overall administration of its Chapter 11
case;
(b) representing the Debtor at court hearings and
communicating with its creditors regarding the matters heard and
the issues raised, as well as the decisions and considerations of
the court;
(c) preparing, reviewing and analyzing legal papers;
(d) coordinating the receipt and dissemination of information
prepared by and received from the Debtor and its retained
professionals;
(e) conferring with the professionals as may be selected and
employed by any official committee;
(f) assisting the Debtor in negotiations concerning the terms
of its plan of reorganization and disclosure statement;
(h) providing the Debtor with services related to the
confirmation of a plan of reorganization;
(i) assisting the Debtor in its discussions and negotiations
with others regarding the terms, conditions, and security for
credit, if any, during the pendency of its Chapter 11 case;
(j) conducting examination of witnesses; and
(k) performing other necessary services for the Debtor.
Morris White III, Esq., a partner in Villa & White, will be
primarily responsible for the supervision of the case and the
coordination and delegation of its administration. He will charge
$400 per hour for his services.
In court papers, Mr. White disclosed that his firm does not hold an
interest adverse to Debtor's estate.
The firm can be reached through:
Morris E. White III, Esq.
Villa & White, LLP
1100 N.W. Loop 410 Ste. 802
San Antonio, TX 78213
Tel: (210) 225-4500
Fax: (210) 212-4649
Email: treywhite@villawhite.com
About Chub Cay
Chub Cay, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Texas Case No. 22-50615) on June 6,
2022, listing as much as $10 million in both assets and
liabilities. The case is assigned to Judge Michael M. Parker.
Morris E. White, III, Esq., at Villa & White, LLP, is the Debtor's
counsel.
CLEVELAND-CLIFFS INC: S&P Raises Unsecured Debt Rating to 'B+'
--------------------------------------------------------------
S&P Global Ratings raised its issue-level rating on
Cleveland-Cliffs Inc.'s unsecured debt to 'B+' from 'B' and revised
its recovery rating on the debt to '3' from '5'. S&P also affirmed
its 'BB' issue-level rating, with a '1' recovery rating on the
company's senior secured debt, and affirmed its 'B-' issue-level
rating, with a '6' recovery rating, on the company's subordinated
debt.
The 'B+' issuer credit rating and positive outlook on
Cleveland-Cliffs are unchanged.
The positive outlook reflects that S&P could upgrade the company if
the company continues reducing debt such that it expects adjusted
leverage will remain below 2x over the next couple of years
Cleveland-Cliffs continues to reduce its debt balance, most
recently repaying $607 million of its 9.875% senior secured notes
due in 2025 using available liquidity. The company has been
repaying debt in the past few years, reducing its secured debt
balance to about $845 million (consisting of 6.75% senior secured
notes due in 2026) from about $2.1 billion at year-end 2020. As a
result, S&P raised its issue-level ratings on the company's
unsecured debt to 'B+' from 'B' and revised the associated recovery
rating to '3' from '5'. The '3' recovery rating indicates its
expectation for meaningful (50%-70%; rounded estimate: 60%)
recovery in the event of default.
S&P said, "At the same time, we affirmed our 'BB' issue-level
rating, with a '1' recovery rating, on Cleveland-Cliffs' secured
debt. The '1' recovery rating indicates our expectation for very
high (90% to 100%; rounded estimate: 95%) recovery in the event of
default. We also affirmed our 'B-' issue-level rating, with a '6'
recovery rating, on the company's subordinated debt. The '6'
recovery rating indicates our expectation for negligible (0%-10%;
rounded estimate: 0%) recovery in default.
"Our 'B+' issuer credit rating and positive outlook on
Cleveland-Cliffs are unchanged. The positive outlook reflects our
expectation that the company will continue to use cash flow
generation toward debt repayment, thereby improving credit quality
and strengthening the cushion against a potential downturn. The
positive outlook also indicates that we could upgrade
Cleveland-Cliffs if the company sustains adjusted leverage of
2x-3x, even in a more normalized pricing environment, which could
happen if the company executes its deleveraging plan with stronger
and steadier EBITDA margins given the transformations of its steel
operations."
ESG credit indicators: E-4, S-2, G-2
COLORADO WORLD: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Colorado World Resorts, LLC
5650 Greenwood Plaza Blvd Suite 103
Greenwood Village, CO 80111
Business Description: The Debtor is a Single Asset Real Estate
(as defined in 11 U.S.C. Section 101(51B)).
Chapter 11 Petition Date: July 15, 2022
Court: United States Bankruptcy Court
District of Colorado
Case No.: 22-12558
Judge: Hon. Michael E. Romero
Debtor's Counsel: Bonnie Bell Bond, Esq.
LAW OFFICE OF BONNIE BELL BOND
8400 E. Prentice Avenue, Suite 1040
Englewood, CO 80111
Email: bonnie@bellbondlaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Ranko Mocevic, member/manager.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/JC5EITI/Colorado_World_Resorts_LLC__cobke-22-12558__0001.0.pdf?mcid=tGE4TAMA
CRED INC: Gets Court OK to Continue Claw Back Attempt From Investor
-------------------------------------------------------------------
Rick Archer of Law360 reports that a Delaware bankruptcy judge on
Monday, July 11, 2022, allowed the liquidating trust for bankrupt
cryptocurrency venture Cred Inc. to continue its attempt to claw
back hundreds of bitcoins from a so-called whale investor, but
dismissed claims he engaged in actual fraud.
In a virtual bench ruling U.S. Bankruptcy Judge John T. Dorsey said
while the trust had sufficiently alleged Cred had sunk into
insolvency at the time it sent the 516.39 in Bitcoin —- currently
worth more than $10.5 million.
A full-text copy of the article is available at
https://www.law360.com/articles/1510457/cred-can-keep-trying-to-claw-back-bitcoin-from-investor
About Cred Inc.
Cred Inc. is a cryptocurrency platform that accepts loans of
cryptocurrency from non-U.S. persons and pays interest on those
loans. Cred -- https://mycred.io/ -- is a global financial services
platform serving customers in over 100 countries. Cred is a
licensed lender and allows some borrowers to earn a yield on
cryptocurrency pledged as collateral.
Cred Inc. and its affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 20-12836) on Nov. 7, 2020. Cred was
estimated to have assets of $50 million to $100 million and
liabilities of $100 million to $500 million as of the bankruptcy
filing.
Judge John T. Dorsey oversees the cases.
The Debtors tapped Paul Hastings LLP as their bankruptcy counsel,
Cousins Law LLC as local counsel, and MACCO Restructuring Group,
LLC as financial advisor. Donlin, Recano & Company, Inc., is the
claims agent.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on Dec. 3,
2020. The committee tapped McDermott Will & Emery LLLP as counsel,
and Dundon Advisers LLC as financial advisor.
Robert Stark is the examiner appointed in the Debtors' cases. Ashby
& Geddes, P.A., and Ankura Consulting Group, LLC, serve as the
examiner's legal counsel and financial advisor, respectively.
CRYOMASS TECHNOLOGIES: Qualifies to Trade on OTCQX
--------------------------------------------------
OTC Markets Group Inc. announced that Cryomass Technologies Inc.
has qualified to trade on the OTCQX Best Market. Cryomass
Technologies Inc. upgraded to OTCQX from the OTCQB Venture Market.
Cryomass Technologies Inc. began trading on July 12, 2022, on OTCQX
under the symbol "CRYM." U.S. investors can find current financial
disclosure and Real-Time Level 2 quotes for the company on
www.otcmarkets.com.
The OTCQX Market provides investors with a premium U.S. public
market to research and trade the shares of investor-focused
companies. Graduating to the OTCQX Market marks an important
milestone for companies, enabling them to demonstrate their
qualifications and build visibility among U.S. investors. To
qualify for OTCQX, companies must meet high financial standards,
follow best practice corporate governance, and demonstrate
compliance with applicable securities laws.
Christian Noel, Cryomass CEO, stated, "We are pleased to reach this
important milestone, as OTCQX is the highest tier of the OTC
markets. Of more than 12,000 securities traded on the OTC Markets,
about 650 (as of June 30, 2022) have met the requirements for
trading on the OTCQX Best Market. The upgrade to the OTCQX
will increase Cryomass's accessibility to U.S. investors and will
allow our shareholders to trade more effectively. This also
reflects our continued commitment to responsible corporate
governance."
About Cryomass
Formerly known as Andina Gold Corp., Cryomass Technologies Inc. is
preparing to manufacture and operate field-mobile equipment for the
handling of harvested cannabis, hemp and other high-value plant
material. The company owns patented technology that utilizes
liquid nitrogen to fully separate, collect and protect the
high-value materials and essential compounds from the harvested
plant.
Cryomass reported a net loss of $12.86 million for the year ended
Dec. 31, 2021, a net loss of $11.82 million for the year ended Dec.
31, 2020, and a net loss of $3.06 million for the year ended Dec.
31, 2019. As of March 31, 2022, the Company had $13.33 million in
total assets, $1.57 million in total liabilities, and $11.75
million in total shareholders' equity.
Lakewood, Colo.-based BF Borgers CPA PC, the Company's auditor
since 2020, issued a "going concern" qualification in its report
dated March 28, 2022, citing that the Company has suffered
recurring losses from operations that raises substantial doubt
about its ability to continue as a going concern.
CUBIC CORP: Fitch Affirms IDR at 'B'; Outlook Stable
----------------------------------------------------
Fitch Ratings has affirmed Cubic Corporation and Atlas CC
Acquisition Corp.'s 'B' Issuer Default Ratings (IDR). Fitch has
also affirmed the company's first-lien term loan B and revolver at
'BB'/'RR1', issued at Atlas CC Acquisition Corp. The Rating Outlook
is Stable.
Cubic's IDRs are supported by its strong EBITDA margins, cash flow
excluding transaction and integration costs, contract
diversification, revenue stability, and significant intellectual
property (IP) portfolio, which differentiates it from its
competition. The company has a strong backlog, which is expected to
expand over the next few years given the potential increase in
infrastructure spending on both a state and federal level.
These positive factors are generally offset by the company's high
initial leverage for the 'B' rating and modest degree of
cyclicality. Execution risk is also present, as Cubic's near- and
intermediate-term profitability and growth potential rely on
achieving the majority of cost-cutting initiatives that management
has outlined.
KEY RATING DRIVERS
Elevated Leverage: Fitch expects that Cubic's gross leverage (debt
to EBITDA) will remain high for the 'B' rating level until the
majority of cost savings actions are completed, though the agency
forecasts steady improvement toward the mid-6.0x range over the
next few years. Fitch views stability at the current rating level
and future positive rating momentum as somewhat dependent on
management's ability to execute on its cost savings plans. If Cubic
is unable to achieve a meaningful portion of these objectives,
Fitch believes leverage could remain elevated beyond one or two
years after the transaction is completed, which in turn could
pressure the 'B' rating level.
Revenue Visibility: Cubic has a substantial amount of revenue
visibility, which Fitch believes supports the 'B' rating despite
higher initial leverage. Many of the contracts on both the
transportation and defense side are several years in duration and
sole-sourced, with only a very small percentage of revenue that is
variable based on transportation traffic volumes. This provides
some stability to the company's overall profile, while certain
indefinite delivery, indefinite quantity (IDIQ) contracts can lead
to additional upside.
Solid Cash Flow and Margins: Fitch considers Cubic's profitability
and cash generation excluding one-time acquisition costs to be
strong for a government contractor, consistent with a higher-rated
entity, and heavily weighted factors when deriving the 'B' IDR.
Fitch forecasts the company's EBITDA margins will improve
substantially under the agency's conservative assumption that the
company achieves around half of its planned cost savings measures
by YE 2022. If the company can execute on these measures and avoids
losing contract renewals, Fitch forecasts Cubic's cash flow will be
positive and increase over the next few years.
Innovative, Diversified Portfolio: Cubic has a highly diversified
and complex product portfolio, which supports the company's credit
profile. The company constantly innovates through R&D investment to
provide highly unique offerings backed by IP. In some cases, the
company partners with customers to become embedded in the decision
loop and better meet customers' objectives. Further, a high
percentage of the company's portfolio comprises sole-sourced
contracts spanning several years, which creates an inherent barrier
to entry for potential competitors.
Revenue Tailwinds: Fitch believes there are several factors that
could contribute to mid-to-high single-digit percentage annual
revenue growth over the next several years. On the transportation
side, the macro trend of urbanization, although somewhat stifled
following the coronavirus pandemic, still largely supports the
increased use and scope of mass transit.
This tailwind should lead to increased use of products that Cubic
produces under Cubic Transportation Systems (CTS), including urban
revenue management systems, cashless tolling and advanced traffic
management solutions. Further, digitization of those systems,
coupled with the implementation of Internet of Things (IoT)
technologies and support from infrastructure spending on both state
and federal levels, would benefit Cubic in excess of Fitch's base
forecasts.
Cubic's defense portfolio should benefit from increased spending on
data-driven training and communication platforms, which Cubic
provides. The company also has partnered with various government
agencies to invest substantially in next-generation technologies,
which could provide long-term growth if the projects evolve.
DERIVATION SUMMARY
Fitch considers the company's leverage profile to be relatively
weaker than 'B' rated peers in the broader Aerospace and Defense
sector, though consistent with other private leveraging
transactions such as Peraton (B/Stable), which was also purchased
in 2021 by Veritas. Cash flow generation and profitability are
projected to become more consistent with that of higher-rated
companies over the rating horizon if the company can execute on its
planned cost saving measures. Cubic's product portfolio is strong
and well diversified by contract and customer with a high degree of
revenue visibility and long-dated contracts that partially offset
the company's weaker leverage.
KEY ASSUMPTIONS
Fitch's Key Rating Assumptions for the Issuer Include:
-- Mid-single-digit annual revenue growth (%) at CTS and Cubic
Mission & Performance Solutions (CMPS) over the next few years
driven by an increased scope of urban revenue management
systems, expansion of cashless tolling systems, utilization of
more advanced traffic management solutions, increased use of
IoT technologies and the greater importance of live virtual
constructive training platforms and other emerging
technologies;
-- EBITDA margins in the mid-to-high teens over the next few
years as the company continues to execute on additional run-
rate cost reduction. There is upside beyond Fitch's forecast
if the company successfully executes on planned synergies;
-- Capex spending expected be around 3% over the rating forecast;
-- Cash outflows related to cost-reduction tapers off beyond
2022;
-- Modest working capital cash outflows;
-- Gross leverage (debt to EBITDA) below 6.0x by 12 to 18 months
following the transaction;
-- Preferred shares are not considered debt;
-- Term loan C is immunized by segregated cash collateral and is
excluded from Fitch's leverage calculations.
KEY RECOVERY RATING ASSUMPTIONS
The recovery analysis assumes that Cubic would be considered a
going concern in bankruptcy and that the company would be
reorganized rather than liquidated. A 10% administrative claim is
assumed in the recovery analysis.
Fitch assumes Cubic will receive a going-concern recovery multiple
of 7.0x EBITDA under this scenario. Fitch considers this multiple
to be toward the upper middle range of recovery multiples assigned
to companies in the Aerospace and Defense sector.
Our recovery assumptions are based on Cubic's moderate and
improving cash flow and margins, long dated and highly visible
contracts, strong intellectual property and technology portfolio.
Fitch also considered the company's contract diversification in
determining a medium to high recovery multiple.
Fitch assumes the going concern EBITDA in the analysis will be
lower than 2022 EBITDA and in line with a downside scenario in
which bankruptcy occurs as a result of materially low contract
renewal rates and contract losses, stemming from either
reputational damage or severely increased competition. Fitch has
lowered our GC EBITDA versus our previous review after evaluating
different potential downside scenarios in which the company either
fails to replace lost EBITDA via new contract awards, while also
experiencing moderate supply chain delays over the rating horizon.
Most of the defaulters in the Aerospace and Defense sector observed
by Fitch in recent bankruptcy case studies were significantly
smaller in scale, had less diversified product lines or customer
bases and were operating with highly leveraged capital structures.
Fitch generally assumes a fully drawn first-lien revolver in its
recovery analyses since credit revolvers are tapped as companies
are under distress.
The first-lien revolver and term loan B are based on Fitch's
recovery analysis under a going concern scenario, and result in
corresponding 'BB' rating and Recovery Rating of 'RR1', indicating
outstanding recovery prospects.
Fitch excluded the term loan C from its recovery waterfall
analysis. In a bankruptcy scenario it is assumed that the cash
collateralization segregated for this facility would be used to
repay the debt associated with it.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Execution on cost saving measures leads to elevated margins
and sustained leverage (debt/EBITDA) below 5x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Leverage sustained greater than 7.0x beyond fiscal 2023;
-- EBITDA interest coverage sustained below 1.75x;
-- Material loss of contract(s) affects the company's
diversification;
-- Consistently neutral to negative FCF.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Fitch considers the company's run-rate liquidity to be solid at
around $400 million, comprised of between $150 million and $200
million of cash on the balance sheet and a $225 million revolving
credit facility. Fitch believes this is adequate to cover the
company's modest capital requirements such as capex and working
capital fluctuations. Fitch does not expect the company to pay
dividends going forward. We consider the cash from issuing its $300
million term loan C to be restricted, as we believe it cannot be
used beyond collateralizing the term loan and associated letters of
credit.
ISSUER PROFILE
Cubic Corporation is a technology driven, market leading provider
of integrated solutions that increase situational awareness for
transportation, defense C4ISR and training customers worldwide to
decrease urban congestion and improve the militaries' effectiveness
and operational readiness.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch does not consider the Term Loan C in its debt calculation or
recovery analysis for Cubic due to the segregated cash that is
restricted to immunize the loan as collateral against its
corresponding $300 million letters of credit facility.
DEBT RATING RECOVERY PRIOR
---- ------ -------- -----
Atlas CC LT IDR B Affirmed B
Acquisition Corp.
senior secured LT BB Affirmed RR1 BB
Cubic Corporation LT IDR B Affirmed B
DALTON CRANE: Taps Jarratt Realty & Land as Realtor
---------------------------------------------------
Dalton Crane, L.C. seeks approval from the U.S. Bankruptcy Court
for the Southern District of Texas to employ Jarratt Realty & Land
to market for sale its real property located at 599 State Highway
111 North, Edna, Texas.
Jarratt Realty & Land will get a commission of up to 6 percent of
the gross sales price.
As disclosed in court filings, Jarratt Realty does not have any
connection representing an adverse interest to the Debtor or its
estate.
The firm can be reached through:
John Jarratt
Jarratt Realty and Land
1101 N Wells St
Edna, TX 77957
Phone: +1 361-782-2114
About Dalton Crane
Dalton Crane, L.C. provides crane and related services within the
Texas oil and gas industry, typically at wellhead or drill
locations for oil and gas drilling and operational businesses. Its
activities involve acquisition, renting, operating and disposition
of crane and related assets currently deployed to various oil and
gas operational cites within south Texas.
Dalton Crane filed a petition for Chapter 11 protection (Bankr.
S.D. Texas Case No. 21-33218) on Oct. 1, 2021, listing $22,113,730
in assets and $14,515,457 in liabilities. Joshua Dalton, chief
executive officer and member of Dalton Crane, signed the petition.
Judge Eduardo V. Rodriguez oversees the case.
Michael G. Colvard, Esq., at Martin & Drought, P.C. and Michael S.
Klingle, CPA, PLLC serve as the Debtor's legal counsel and
accountant, respectively.
Signature Financial LLC, as creditor, is represented by Frances
Smith, Esq., at Ross and Smith PC and Morrit Hock and Hamroff LLP.
First State Bank, as secured creditor, is represented by Richard
Chapman, Esq., at Anderson, Smith, Null & Stofer, LLP.
DENTAL LAND: Seeks Interim Use of Cash Collateral
-------------------------------------------------
Dental Land Pediatrics, LLC asks the U.S. Bankruptcy Court for the
District of Maryland for authority to use cash collateral on an
interim basis in accordance with its agreement with Bank of
America, NA.
The Debtor requires use of cash collateral to operate the business,
maintain its financial affairs and pay trustee escrow.
Bank of America, N.A., maintains a lien that encumbers the Debtor's
business assets including cash collateral.
The parties agree the Bank of America secured claim will be
established at $204,000 as evidenced by it proof of claim number 4
with attachments filed on June 13, 2022. Bank of America's secured
claim will be paid over five years at a variable prime rate not to
exceed five percent. That parties acknowledge that the prime rate
is currently 4.75%.
The parties agree that the initial principal and interest payment
to Bank of America, at four and 4.75% will be $3,826 per month.
The parties agree that interest/adequate protection payments on the
Bank of America secured claim will be $807 monthly and will
commence immediately upon entry of the Order and will be due and
owing on the 10th day of each month thereafter.
The Debtor may use the cash collateral as set forth in the
Budget/Monthly Operating Report which may vary from month to month
for the specific purposes set forth in the Budget for the Budget
Period commencing nunc pro tunc from April 24 through October 23,
2022, or such later date as may be agreed to in writing by the
Lender and the Debtor and approved by the Court.
The Debtor agrees to provide to the Lender and the Lender's
counsel:
-- A Cash Balance Report and a Variance Report, on a monthly
basis covering the prior month period; and
-- The Debtor's monthly operating reports, which the Debtor is
required to file with the Court, for each month in the Budget
Period by the deadline established by the Court or the Office of
the United States Trustee.
These events constitute an "Event of Default:"
a. The use and disbursement of cash collateral except as
expressly permitted hereunder;
b. The actual expenditure of cash collateral by the Debtor by
more than a reasonable amount over the Debtor's existing monthly
operating expenses with respect to Budget expenditures as expressly
permitted thereunder or by Court order;
c. The filing of a motion seeking court approval of the sale
of substantially all of the business assets of the Debtor, unless
such motion provides for the payment in full of the Lender's claim;
d. The filing of a motion seeking to prime the Lender's first
priority lien and security interest;
e. The failure to provide any report, document, or information
or to provide access to the Lender as required thereby;
f. The failure to make any payment to the Lender as required
thereby;
g. The failure to maintain all necessary insurance as required
under the Loan Documents provided that the Lender consents to the
Debtor's use of cash collateral to pay for such insurance;
h. Either of the Debtor's exclusive periods to file and
solicit acceptances of a plan is terminated or lifted under
Bankruptcy Code Section 1121 or otherwise;
i. A trustee is appointed or elected, or an examiner with the
power to operate the Debtor's business is appointed, in the
Bankruptcy Case;
j. The Bankruptcy Case is converted to a case under Chapter 7
or is dismissed;
k. The Approval Order is reversed, vacated, stayed, amended,
or supplemented without the consent of the Lender;
l. Relief from the automatic stay is granted to any party to
permit the exercise of remedies with respect to any property of
Debtor's estate unless consented to by the Lender; and
m. Any material representation or warranty, express or
implied, made by the Debtor in any certificate, report, expense
statement, other financial statement, or other document delivered
to the Lender after the Petition Date proves to have been false or
misleading in any material respect as of the time when made or
given.
A copy of the motion is available at https://bit.ly/3PM4RSX from
PacerMonitor.com.
About Dental Land Pediatrics
Dental Land Pediatrics, LLC, a pediatric dental clinic in Bowie,
Md., filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Md. Case No. 22-12169) on April 24,
2022, listing up to $50,000 in assets and up to $1 million in
liabilities. Michael Wolff serves as Subchapter V trustee.
Judge Lori S. Simpson oversees the case.
The Debtor tapped Frank Morris, II, Esq., at the Law Office of
Frank Morris II as bankruptcy counsel; Winstead Tax Group, LLC as
tax counsel; and Comprehensive Business of Northern Virginia, LLC
as accountant.
DIOCESE OF CAMDEN: Herman Law Represents Sexual Abuse Survivors
---------------------------------------------------------------
In the Chapter 11 cases of The Diocese of Camden, New Jersey, the
law firm of Herman Law submitted a verified statement under Rule
2019 of the Federal Rules of Bankruptcy Procedure, to disclose that
it is representing the Sexual Abuse Survivors with tort claims.
Herman Law devotes its law practice to the representation of
victims of child sexual abuse in civil cases. Herman Law represents
clients in these matters across the country. Given this expertise,
Herman Law has been retained by victims of child sexual abuse in
parishes of the Diocese to pursue their claims against the Diocese,
parishes and/or schools. Herman Law represents no creditors or
parties in interest in this Chapter 11 proceeding other than sex
abuse survivors with tort claims.
Neither Herman Law nor any attorney or employee of the firm has at
any relevant time owned any claim or interest in the Debtor.
The names and addresses of the confidential Claimants are available
to permitted parties who have executed a confidentiality agreement
and have access to the Sexual Abuse Claim Forms.
A true and correct copy of New Jersey exemplar retainer agreement
between Herman Law and each of its clients who are Claimants in
this proceeding are attached hereto as Exhibit B. This agreement
complies with NJ Rule 1:21-7(c). Herman Law's interest relative to
each Claimant is set forth in the retainer agreement executed by
each Claimant, and is shown in the exemplar retainer agreement.
The Firm can be reached at:
HERMAN LAW
Lara Lovett, Esq.
434 W. 33rd St., 7th Floor
New York, NY l000 1
Tel: (212) 390-0100
E-mail: llovett@hermanlaw.com
A copy of the Rule 2019 filing is available at
https://tinyurl.com/nrhx4tjv at no extra charge.
About The Diocese of Camden, NJ
The Diocese of Camden, New Jersey is a nonprofit religious
corporation organized pursuant to Title 16 of the Revised Statutes
of New Jersey.  The Diocese is the secular legal embodiment of
the Roman Catholic Diocese of Camden, a juridic person recognized
under Canon Law.
The Diocese of Camden sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.N.J. Case No. 20-21257) on Oct. 1, 2020.
The petition was signed by Reverend Robert E. Hughes, vicar General
and vice president. At the time of the filing, the Debtor had
total assets of $53,575,365 and liabilities of $25,727,209. Judge
Jerrold N. Poslusny Jr. oversees the case. McManimon, Scotland &
Baumann, LLC, is the Debtor's legal counsel.
EAGLE LEDGE: Wins Interim Cash Collateral Access Thru Oct 31
------------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of California,
Modesto Division, authorized Eagle Ledge Foundation, Inc. to use
cash collateral on an interim basis in accordance with the budget,
with a 15% variance through October 31, 2022.
The funds, which may include cash collateral, that the Debtor is
authorized to use are the monies in its operating accounts which
the Debtor states total approximately $761,165. The Court says no
determination has been made whether the funds are cash collateral.
The Court also makes no determination at this time as to the
extent, priority, or validity of any security interest held by or
the obligations owed to any creditor prior to the Petition Date.
As adequate protection, each creditor is given a replacement lien
on all post-petition assets of the Bankruptcy state in such amount
necessary to compensate for the diminution of the creditor's
secured claim, computed prior to the use of cash collateral, due to
a reduction in the collateral security such claim.
The replacement liens are deemed perfected by the Court's order and
no further recording or documentation of the lien is required.
A further hearing on the matter is scheduled for October 6, 2022 at
10:30 a.m.
A copy of the order and the Debtor's budget for the period from May
to October 2022 is available at https://bit.ly/3P307YW from
PacerMonitor.com.
The Debtor projects $105,516 in total sources and $60,481 in total
uses for the period.
About Eagle Ledge Foundation, Inc.
Formed in 2009, Eagle Ledge Foundation, Inc. is a California
not-for-profit religious corporation. ELF launched a loan fund
focused on serving the small local church, which often lacked
financing options with commercial lenders. ELF issued bond
certificates to individuals who made, either directly or through
their retirement accounts, contributions to ELF.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Cal. Case No. 22-90160) on May 18,
2022. In the petition signed by Chester L. Reid, president, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Ronald H. Sargis oversees the case.
Lubin Olson & Niewiadomski LLP and Bush Ross, P.A. represent the
Debtor as counsel.
EASCO BOILER: Seeks to Hire ASI as Financial Advisor
----------------------------------------------------
Easco Boiler Corp. and Leggett Real Estate Holdings, LLC seek
approval from the U.S. Bankruptcy Court for the Southern District
of New York to employ ASI Advisors, LLC as their financial
advisor.
The firm will render these services:
(a) assist in the development and preparation of business
plan, financial projections, cash flow budget, and other financial
reports;
(b) negotiate and communicate with the Debtors' various
stakeholders and parties-in-interest;
(c) identify opportunities to improve profitability and assist
management in improving working capital utilization;
(d) assist in the identification of opportunities to improve
profitability and assist in management;
(e) assist the Debtors in the management and enhancement of
their liquidity issues;
(f) assist the Debtors in seeking out potential sources of new
investment capital and funding, and in the development and
execution of restructuring options;
(g) assist management and counsel to the Debtors in preparing
and evaluating a potential plan of reorganization;
(h) assist the Debtors in the management and administration of
the Chapter 11 bankruptcy process; and
(i) perform other necessary financial advisory services.
ASI's hourly rates range from $325 to $375 based upon the staff
assigned to the respective tasks.
The firm received a retainer in the amount of $25,000 from Easco.
Donald Stukes, a partner at ASI Advisors, 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:
Donald A. Stukes
ASI Advisors, LLC
50 Main Street, Suite 1000
White Plains, NY 10606
Telephone: (914) 234-6133
Facsimile: (914) 234-0837
Email: dstukes@asi-advisors.com
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.
EASCO BOILER: Taps Riemer & Braunstein as Bankruptcy Counsel
------------------------------------------------------------
Easco Boiler Corp. and Leggett Real Estate Holdings, LLC seeks
approval from the U.S. Bankruptcy Court for the Southern District
of New York to employ Riemer & Braunstein, LLP as their bankruptcy
counsel.
The firm will render these services:
(a) advise the Debtors regarding their powers and duties in
the continued management and operation of their business and
assets;
(b) attend meetings and negotiate with representatives of
creditors and other parties-in-interest and respond to creditor
inquiries;
(c) advise and assist the Debtors in connection with any
potential asset disposition and sale, if warranted;
(d) assist the Debtors in reviewing, estimating and resolving
claims asserted against their estate;
(e) negotiate and prepare any sale or plan of reorganization;
(f) prepare legal papers; and
(g) perform all other bankruptcy-related legal services for
the Debtors.
The firm will be paid at these hourly rates:
Senior Partners
Alan L. Braunstein $795
Donald E. Rothman $795
Jeffrey D. Ganz $755
Partners
Philip Block $655
Alissa Poynor $465
Macken Toussaint $465
Guy Moss $695
Peter Sutton $745
Michael Fallman $775
Paralegals
Nicole M. Daley $225
Dennis Haley $225
The firm received a retainer from Easco in the amount of $50,000,
and another $50,000 from Leggett.
Alan Braunstein, Esq., a partner at Riemer & Braunstein, 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:
Alan L. Braunstein, Esq.
Riemer & Braunstein, LLP
Times Square Tower, Suite 2506
Seven Times Square
New York, NY 10036
Email: abraunstein@riemerlaw.com
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.
ENCORE CAPITAL: Fitch Affirms BB+ LongTerm IDR, Outlook Stable
--------------------------------------------------------------
Fitch Ratings has affirmed Encore Capital Group, Inc.'s Long-Term
Issuer Default Rating (IDR) at 'BB+' with a Stable Outlook. Fitch
has also affirmed Encore's super-senior secured private placement
notes at 'BBB-' and its senior secured debt at 'BB+'.
KEY RATING DRIVERS
IDR
Encore's Long-Term IDR reflects its leading franchise in the debt
purchasing sector in its chosen markets, its strong recent
profitability and its low leverage relative to the sector. These
factors are counter-balanced by the concentration of its activities
on debt purchasing and a longer-term need to maintain a flow of
receivable purchases (and associated funding) to support estimated
remaining collections (ERC) from which future earnings are
derived.
Encore has a record of over 25 years in debt purchasing, focusing
principally on the structurally deep credit markets of the US and
the UK. It acquires portfolios of defaulted receivables from
financial service providers including banks, credit unions,
consumer finance companies and commercial retailers.
In 2021 Encore reported pre-tax earnings of USD437 million, a
second successive annual record, as debt repayments from consumers
remained strong, assisted by the economic support provided by
governments amid the pandemic. Collections in 1Q22 were slower but
still sound, with Encore reporting pre-tax income of USD231
million, having written up the value of expected recoveries by
USD167 million.
Portfolio purchases in 1Q22 were consistent with 1Q21 at USD170
million, but have still yet to return to pre-pandemic levels, as
economic support measures slowed the rate at which financial
institutions generated new non-performing loans for purchase. At
end-1Q22, Encore's ERC had reduced to USD7.7 billion, from USD8.3
billion at end-1Q21. Although collections in the last two years
have generally been robust, Fitch sees potential for pressure on
consumer repayment capacity from current higher inflation, while
collections tend to slow as the average age of portfolios lengthens
(amid tight supply of fresh receivables).
Fitch's primary leverage metric for debt purchasers is gross
debt/adjusted EBITDA (including adjustments for portfolio
amortisation). Fitch calculates Encore's gross debt-to-adjusted
EBITDA at end-2021 at 1.9x, which compares favourably with the
typical profile of European debt purchasers. Fitch also considers
debt-to-tangible equity as a complementary leverage metric. This
has improved in recent years, as Encore's profitability has offset
the effect of past goodwill, but at end-1Q22 was still high at
7.9x.
At end-1Q22 Encore had comfortable available liquidity of USD560
million, via cash and headroom from an undrawn revolving credit
facility (RCF). Additional funding sources comprised USD1.6 billion
of senior secured notes, USD98 million of outstanding super-senior
private placement notes and a USD460 million asset-backed facility,
supplemented by unsecured convertible and exchangeable notes
totalling USD273 million. In March 2022, USD150 million of
convertibles were repaid from available cash.
In 2020 Encore implemented a revised global funding structure,
under which the previously legally separate funding structures of
its US and European businesses were combined, with the majority of
Encore's debt now equally guaranteed by most subsidiaries across
the group. Since then several new issues of senior secured notes
have extended the maturity profile of Encore's funding, and fixed
much of its cost at attractive rates. While the debt purchasing
business model requires replenishment of assets over the longer
term with fresh portfolio acquisitions, companies have the option
over shorter periods to moderate their rate of investment, and
thereby conserve liquidity.
SUPER-SENIOR SECURED NOTES
Encore's 5.625% super-senior private placement notes rank equally
with its multi-currency RCF, and super-senior to other senior
secured debt. The notes' rating is notched up once from Encore's
'BB+' IDR, reflecting Fitch's expectation of above-average recovery
prospects. Under Fitch's NBFI Rating Criteria upward notching of
secured debt from sub-investment grade issuers is capped at
'BBB-'.
SENIOR SECURED NOTES
Encore's senior secured notes are guaranteed by most group
subsidiaries and rank equally with other senior secured
obligations. Their rating is equalised with Encore's Long-Term IDR,
due to prior claim on available security of the higher-ranking
super-senior debt. This results in average rather than
above-average recoveries for Encore's senior secured notes.
Encore has an ESG Relevance Score of '4' for customer welfare -
fair messaging, privacy & data security in view of the importance
of fair collection practices and consumer interactions and the
regulatory focus on them, particularly in the US.
Encore has an ESG Relevance Score of '4' for financial transparency
on account of the significance of internal modelling to portfolio
valuations and associated metrics such as ERC. These factors have
negative influences on the rating, but their impact is only
moderate, and they are features of the debt purchasing sector as a
whole, and not specific to Encore.
RATING SENSITIVITIES
IDR
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Gross debt/adjusted EBITDA leverage consistently below 2.5x,
while continuing to grow the tangible equity position;
-- Demonstration of ongoing earnings resilience despite near-term
contraction of NPL supply and medium-term uncertainty as to
customer repayment performance amid post-pandemic inflationary
pressures.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- A sustained fall in cash collections, resulting in materially
reduced earnings generation or write-down of the value of
portfolio investments;
-- Failure to adhere to management's public leverage guidance of
maintaining net debt/adjusted EBITDA of 2x-3x;
-- A material adverse operational event or regulatory
intervention undermining franchise strength or business-model
resilience.
SUPER-SENIOR AND SENIOR SECURED DEBT
The ratings of the super-senior and senior secured notes are
primarily sensitive to changes in Encore's IDR. However, a
downgrade of Encore's IDR would not automatically lead to negative
rating action on the notes, depending on Fitch's view of the likely
impact on recoveries of the circumstances giving rise to the
downgrade.
Changes to Fitch's assessment of relative recovery prospects for
senior secured debt in a default (e. as a result of a material
shift in the proportion of Encore's debt which is either super
senior or unsecured) could also result in the senior secured debt
rating being notched up or down from 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
Encore 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, particularly in the US.
Encore also 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 ERC. These
factors have negative influences on the rating, but their impact is
only moderate, and they are features of the debt purchasing sector
as a whole, and not specific to Encore.
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
---- ------ -----
Encore Capital LT IDR BB+ Affirmed BB+
Group, Inc.
super senior LT BBB- Affirmed BBB-
senior secured LT BB+ Affirmed BB+
ENDLESS POSSIBILITIES: Gets Cash Collateral Access Thru July 28
---------------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida, Tampa
Division, authorized Endless Possibilities, LLC, d/b/a Regymen
Fitness, to use cash collateral in accordance with the budget, with
a 10% variance.
The Debtor is permitted to use cash collateral to pay: (a) amounts
expressly authorized by the Court; (b) the current and necessary
expenses set forth in the budget; (c) additional amounts as may be
expressly approved in writing by its lenders.
The Court says expenditures in excess of the line items in the
budget or not on the budget will not be deemed to be unauthorized
use of cash collateral, unless the recipient cannot establish that
the expense would be entitled to administrative expense priority if
the recipient had extended credit for the expenditure. Expenditures
in excess of the line items in the budget or not on the budget may,
nonetheless, give rise to remedies in favor of the Lenders.
As adequate protection for the Debtor's use of cash collateral,
each creditor with a security interest in cash collateral will have
a perfected post-petition lien against cash collateral to the same
extent and with the same validity and priority as the prepetition
lien, without the need to file or execute any document as may
otherwise be required under applicable non bankruptcy law.
As previously reported by the Troubled Company Reporter, Regymen
Fitness, LLC is the Debtor's franchisor. Regymen asserts a lien on
specific pieces of equipment and proceeds thereof.
The Debtor owes Construction Services, Inc. of Tampa, its builder,
for construction services. CSI may assert an interest in the cash
collateral.
A further hearing on the matter is scheduled for July 28, 2022 at 4
p.m.
A copy of the order and the Debtor's budget is available at
https://bit.ly/3P32sDc from PacerMonitor.com.
About Endless Possibilities, LLC
Endless Possibilities, LLC d/b/a Regymen Fitness, operates a
fitness studio with specialized instructors.
The Debtor sought protection under Chapter 11 of the U.S.Bankruptcy
Code (Bankr. M.D. Fla. Case No. 22-00259) on January 21, 2022. In
the petition signed by Gretchen Mitchell, managing member, the
Debtor disclosed up to $500 in assets and up to $10 million in
liabilities.
Judge Catherine Peek McEwen oversees the case.
Scott A. Stichter, Esq., at Stichter, Riedl, Blain and Poster, P.A.
is the Debtor's counsel.
EVO TRANSPORTATION: Maturity of $9M Loan Extended to July 15
------------------------------------------------------------
In a Schedule 13D/A filed with the Securities and Exchange
Commission, Antara Capital LP, Antara Capital GP LLC, and Himanshu
Gulati disclosed that as of July 8, 2022, they beneficially owned
24,483,830 shares of common stock of EVO Transportation & Energy
Services, Inc., representing 63.5% of the shares outstanding.
The Reporting Persons filed this Amendment No. 10 to report that on
July 8, 2022, the Issuer, certain specified subsidiaries of the
Issuer, Antara Master Fund (the "Lender") and certain current and
former executives of the Issuer, or funds affiliated with such
executives, entered into a Third Extension Agreement pursuant to
which, among other things, the stated maturity date of a loan in an
initial principal amount of $9 million from the Lender to the
Issuer, borrowed pursuant that certain Senior Secured Loan and
Executive Loan Agreement dated March 11, 2022, as amended by that
certain Extension Agreement dated May 31, 2022 and that certain
Second Extension Agreement dated June 30, 2022, was extended from
July 8, 2022 to July 15, 2022.
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/0000728447/000119312522191314/d370394dsc13da.htm
About EVO Transportation
Headquartered in Peoria, AZ, EVO Transportation & Energy Services,
Inc. is a transportation provider serving the United States Postal
Service ("USPS") and other customers. The Company believes it is
the second largest surface transportation company serving the USPS,
with a diversified fleet of tractors, straight trucks, and other
vehicles that currently operate on either diesel fuel or compressed
natural gas.
Tulsa, Oklahoma-based Grant Thornton LLP, the Company's auditor
since 2021, issued a "going concern" qualification in its report
dated June 30, 2022, citing that the Company's current liabilities
exceeded its current assets by $93.4 million and its total
liabilities exceeded its total assets by $42.1 million as of Dec.
31, 2021. These conditions, along with other matters, raise
substantial doubt about the Company's ability to continue as a
going concern.
FUELCELL ENERGY: Signs Deal to Sell 95 Million Common Shares
------------------------------------------------------------
FuelCell Energy, Inc. entered into an Open Market Sale Agreement
with Jefferies LLC, B. Riley Securities, Inc., Barclays Capital
Inc., BMO Capital Markets Corp., BofA Securities, Inc., Canaccord
Genuity LLC, Citigroup Global Markets Inc., J.P. Morgan Securities
LLC and Loop Capital Markets LLC, with respect to an at the market
offering program under which the Company may, from time to time,
offer and sell up to 95,000,000 shares of the Company's common
stock, par value $0.0001 per share, through the Agents, acting as
sales agents, or directly to the Agents, acting as principals. The
Shares to be sold under the 2022 Sales Agreement, if any, will be
issued and sold pursuant to the Company's shelf registration
statement on Form S-3ASR (File No. 333-251054), which was filed
with the Securities and Exchange Commission on Dec. 1, 2020 and
which became effective upon filing. A prospectus supplement
related to the Company's at the market offering program with the
Agents was filed with the SEC on July 12, 2022.
Sales of the Shares, if any, pursuant to the 2022 Sales Agreement
and under the prospectus supplement and accompanying prospectus may
be made by any method that is deemed to be an "at the market
offering" as defined in Rule 415(a)(4) under the Securities Act of
1933, as amended. Each time the Company wishes to issue and sell
Shares under the 2022 Sales Agreement, it will notify an Agent of
the number or dollar amount of Shares to be issued, the dates on
which such sales are requested to be made, any limitation on the
number of Shares to be sold in any one day, and any minimum price
below which sales may not be made. Once the Company has so
instructed the Agent, unless the Agent declines to accept the terms
of such notice, such Agent has agreed to use its commercially
reasonable efforts consistent with its normal trading and sales
practices to sell such Shares up to the amount specified on such
terms. The obligations of the Agents under the 2022 Sales
Agreement to sell Shares are subject to a number of conditions that
the Company must meet. The Company may sell the Shares through
only one Agent on any particular trading day.
The Company will pay each Agent a commission equal to 2.0% of the
gross proceeds from each sale of the Shares made through or to such
Agent from time to time under the 2022 Sales Agreement. Because
there is no minimum offering amount required as a condition to
close the offering, the actual total public offering amount,
commissions and proceeds to the Company, if any, are not
determinable at this time. In addition, the Company has agreed to
reimburse the Agents for the fees and disbursements of their legal
counsel, payable upon execution of the 2022 Sales Agreement, in an
amount not to exceed $50,000, in addition to certain ongoing
disbursements of their legal counsel. The Company has agreed to
indemnify the Agents against certain civil liabilities, including
liabilities under the Securities Act. The Company has also agreed
to contribute to payments the Agents may be required to make in
respect of such liabilities.
The Company has no obligation to sell any of the Shares under the
2022 Sales Agreement, and the Company or the Agents may suspend
sales of the Shares under the 2022 Sales Agreement upon proper
notice to the other party. The offering of the Shares pursuant to
the 2022 Sales Agreement will terminate upon the earlier of (i) the
sale of the maximum number of Shares to be sold pursuant to the
2022 Sales Agreement or (ii) the termination of the 2022 Sales
Agreement as permitted therein. Any party may terminate the 2022
Sales Agreement at any time upon ten trading days' prior notice.
The termination of the 2022 Sales Agreement by, or with respect to,
one Agent shall not affect the rights and obligations of any other
Agent under the 2022 Sales Agreement.
In the 2022 Sales Agreement, the Company, Jefferies LLC and
Barclays Capital Inc. mutually agreed to terminate the Open Market
Sale AgreementSM they previously entered into on June 11, 2021.
About FuelCell Energy
Headquartered in Danbury, Connecticut, FuelCell Energy, Inc. --
http://www.fuelcellenergy.com-- is a global developer of
distributed baseload power solutions through its proprietary fuel
cell technology. The Company targets large-scale power users with
its megawatt-class installations globally, and currently offer
sub-megawatt solutions for smaller power consumers in Europe. The
Company develops turn-key distributed power generation solutions
and operate and provide comprehensive service for the life of the
power plant.
FuelCell reported a net loss of $101.03 million for the year ended
Oct. 31, 2021, a net loss of $89.11 million for the year ended Oct.
31, 2020, a net loss of $77.57 million for the year ended Oct. 31,
2019, and a net loss of $47.33 million for the year ended Oct. 31,
2018. As of Jan. 31, 2022, the Company had $854.69 million in
total assets, $182.65 million in total liabilities, $59.86 million
in redeemable series B preferred stock, $15.45 million in
redeemable noncontrolling interests, and $596.74 million in total
equity.
GATHERING PLACE: Seeks Cash Collateral Access
---------------------------------------------
The Gathering Place Orlando, Inc. asks the U.S. Bankruptcy Court
for the Middle District of Florida for authority to use cash
collateral and provide adequate protection to Peter Charles Triolo,
and, to the extent necessary, the holders of inferior position
security interests in the Debtor's collateral, the U.S. Small
Business Administration.
The Debtor contends it is essential that the Debtor continue its
operations without interruption, which will require the use of
funds on hand and funds to be received. Those funds may be subject
to a lien in favor of Triolo.
The cash collateral, which the Debtor seeks to use, is comprised in
whole or in part of the Debtor's income, cash, receivables and
proceeds received from or on account of its prepetition or post
petition business operations therein called revenue or cash
collateral.
The Debtor says Triolo may assert a first priority security
interest in the Debtor's accounts and personal property by virtue
of a recorded lien on the Debtor's personal property. As of the
Petition Date, the Debtor owed Triolo approximately $1,371,473
secured by a blanket lien on the Debtor's personal property.
The Debtor further relates that the holders of Inferior Interests
may claim an inferior interest in the Debtor's accounts receivable
and inventory by virtue of alleged liens on the Debtor's personal
property. The Debtor believes the Interior Interest holders are
wholly unsecured due to the outstanding amounts owed to creditors
with superior security interests in the Debtor's property, or due
to disputes over the basis for those creditors' respective alleged
security interests.
As adequate protection for the use of cash collateral, the Debtor
proposes to grant both the Inferior Interest holders and Triolo --
as Secured Creditors -- replacement liens to the same validity,
extent, and priority as their respective prepetition liens.
A copy of the motion and the Debtor's budget is available at
https://bit.ly/3z2oL6y from PacerMonitor.com.
About The Gathering Place Orlando
The Gathering Place Orlando Inc. -- https://www.tgporlando.org --
operates a church known as The Gathering Place, where everyone is
welcome. Its main operations are conducted from the facilities it
owns at 8287 Curry Ford Road, Orlando, Florida 32822.
On June 30, 2022 The Gathering Place Orlando, Inc., filed a
petition for relief under Subchapter V of Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-02342). In the
petition filed by Howard Harrison, as president, the Debtor
estimated assets and liabilities between $1 million and $10
million.
Jarrett McConnell has been appointed as Subchapter V trustee.
Jeffrey Ainsworth, Esq., at BransonLaw PLLC, is the Debtor's
counsel.
GENAPSYS INC: Wins Cash Collateral Access, $1MM DIP Loan
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware authorized
GenapSys, Inc. to use cash collateral in accordance with the budget
and obtain postpetiton financing, on an interim basis.
The Debtor is permitted to obtain secured postpetition financing
pursuant to the terms and conditions of a Secured
Debtor-in-Possession Term Loan and Security Agreement, by and among
the Debtor, Oxford Finance LLC, as Administrative Agent and
Collateral Agent, Oxford and any other entity that becomes a lender
under the DIP Facility in an aggregate principal amount not to
exceed $1,000,000.
The Debtor requires the use of cash collateral and the DIP Loans to
finance its operations and fund its Sale Process.
On December 20, 2019, the Debtor entered into the Prepetition Loan
Agreement, as amended from time to time thereafter, with the
Prepetition Secured Parties. The Prepetition Loan Agreement
provides for term loans in the aggregate principal amount of $30
million.
As of the Petition Date, the Debtor is liable for payment of all
outstanding Prepetition Loan Obligations, and the outstanding
Prepetition Loan Obligations will be an allowed secured claim in an
amount not less than $31,946,423, plus all accruing interest, fees,
expenses, and other amounts owed to the Prepetition Secured Parties
under the Prepetition Loan Documents.
As adequate protection against any diminution in value of the
Prepetition Agent's interest in the Prepetition Collateral, the
Prepetition Agent is granted a valid and perfected security
interest in, and lien on all of the right, title and interest of
the Debtor in, to, and under all present and after-acquired
property and assets of the Debtor.
Subject to the Carve-Out, the Adequate Protection Liens will be (i)
first priority perfected liens on all of the Postpetition
Collateral that is not otherwise encumbered by validly perfected,
non-avoidable security interests or liens as of the Petition Date,
(ii) first priority perfected replacement liens on all of the
Postpetition Collateral as to which the Prepetition Agent had a
first priority lien as of the Petition Date, and (iii) junior
perfected liens on all Postpetition Collateral that is subject to a
Prior Lien. The Adequate Protection Liens on the Postpetition
Collateral will be senior to the DIP Liens on such Postpetition
Collateral.
The Adequate Protection Liens will be enforceable against the
Debtor, its estate, and any successors thereto, including without
limitation, any trustee or other estate representative appointed in
the Chapter 11 Case, or any case under chapter 7 of the Bankruptcy
Code upon the conversion of the Chapter 11 Case, or in any other
proceedings superseding or related to any of the foregoing.
As further adequate protection against any diminution in value of
the interests of the Prepetition Agent in the Prepetition
Collateral, the Prepetition Agent is granted allowed superpriority
administrative expenses claims in the Chapter 11 Case or any
Successor Case in the amount of the Adequate Protection
Obligations, which will be payable from and have recourse to all
Postpetition Collateral and all proceeds of Postpetition
Collateral.
The Adequate Protection Superpriority Claims will be junior only to
the Carve-Out. Except for the Carve-Out, the Adequate Protection
Superpriority Claims will have priority over all administrative
expense claims and unsecured claims against the Debtor or its
estate, including the DIP Superpriority Claim, now existing or
hereafter arising, of any kind or nature whatsoever.
The final hearing on the matter is scheduled for August 4, 2022 at
10 a.m.
A copy of the order is available at https://bit.ly/3onvsdn from
PacerMonitor.com.
About GenapSys, Inc.
GenapSys, Inc. is focused on the advancement of universal access to
genomic information by delivering an affordable, scalable, and
accurate genomic sequencing ecosystem that empowers both academic
and clinical research applications. Its system leverages a
proprietary electrical microfluidic sequencing chip with a scalable
number of detectors, allowing for a wide range of applications.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Case No. 22-10621) on July 11,
2022. In the petition signed by Britton Russell, chief financial
officer and treasurer, the Debtor disclosed up to $50 million in
both assets and liabilities.
Judge Brendan Linehan Shannon oversees the case.
Daniel J. DeFranceshi, Esq., at Richards, Layton and Finger, P.A.
is the Debtor's counsel. The Debtor tapped Wilikie Farr and
Gallagher LLP as special litigation counsel and transactional
counsel, Lazard Freres and Co. LLC as investment banker, and Kroll
Restructuring Administration LLC as claims, noticing and
administrative agent.
GRACE COMMUNITY: Seeks Approval to Hire Gordon Law as Counsel
-------------------------------------------------------------
Grace Community Baptist Church of Woodstock, Inc. seeks approval
from the U.S. Bankruptcy Court for the Northern District of Georgia
to hire The Gordon Law Firm, PC, as its counsel.
The firm will represent and provide legal services in connection
with the Chapter 11 bankruptcy proceedings.
Gordon Law will be paid based upon its normal and usual hourly
billing rates. The firm will also be reimbursed for reasonable
out-of-pocket expenses incurred.
Sims W. Gordon, Jr., partner of The Gordon Law Firm, PC, assured
the Court that the firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code and does not
represent any interest adverse to the Debtor and its estates.
Gordon Law Firm can be reached at:
Sims W. Gordon, Jr., Esq.
THE GORDON LAW FIRM, PC
400 Galleria Parkway, SE, Suite 1500
Atlanta, GA 30339
Tel: (770) 955-5000
Email: law@gordonlawpc.com
About Grace Community Baptist Church of Woodstock
Grace Community Baptist Church of Woodstock is a tax-exempt
religious organization. Its primary business office and place of
worship is valued at $4.20 million.
Grace Community Baptist Church of Woodstock, Inc. filed its
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Ga. Case No. 22-55046) on July 4, 2022. The
petition was signed by Christopher Chappell as CEO. At the time of
filing, the Debtor estimated $4,332,713 in assets and $2,730,892 in
liabilities. Sims W. Gordon, Jr., Esq. at The Gordon Law Firm, P.C.
serves as the Debtor's counsel.
GRIFFON CORP: S&P Affirms 'B+' ICR, Outlook Stable
--------------------------------------------------
S&P Global Ratings affirmed its 'B+' issuer credit rating on
diversified management and holding company Griffon Corp. At the
same time, S&P raised the issue-level rating on the company's
unsecured notes to 'B' from 'B-' and revised the recovery rating to
'5' from '6' given a lower amount of secured debt a default
scenario.
The stable outlook reflects S&P's view that credit metrics will
remain in line with its expectations for the rating with debt to
EBITDA around 5x.
Griffon Corp. has completed the sale of its defense electronics
business (Telephonics) to TTM Technologies for $330 million. The
company used proceeds to prepay $300 million of its $800 million
term loan B due 2029 and declared special dividend payable on July
20, 2022, that S&P estimates will total about $100 million.
S&P said, "We expect S&P adjusted debt leverage will be close to 5x
in fiscal 2022. This is the same as our prior expectations and
compares with about 6x for the 12-months-ended March 31, 2022.
Griffon received $330 million of proceeds from the sale of its
defense electronics business. The company used $300 million of the
proceeds to prepay some of its $800 million term loan B due 2029.
It will use the remaining proceeds, along with free cash flows, to
pay a special $2 per share dividend, which we estimate will be
about $100 million (after removing restricted and employee stock
ownership plan {ESOP} shares). Our prior debt leverage expectation
of 5x remains unchanged despite the debt repayment. This is because
of lower EBITDA (5%-10% lower) due to weaker macroeconomic
assumptions, along with inflation and higher interest on floating
rate debt. The company will have lower discretionary cash flows as
a large portion of free operating cash flows will be used for the
special dividend. However, debt leverage will improve as Griffon
benefits from about nine months of earnings from the Hunter Fan
acquisition.
"We base our assessment of Griffon's competitive position on its
well-known brands and leading market positions. Griffon's brands
include Clopay garage doors, AMES garden tools, ClosetMaid
organization products, and Hunter Fans, which is a leading
distributor and designer of residential fans with about 30% market
share in the U.S. residential fan market. Many products are the
largest or second-largest sellers in their categories, making them
attractive for large retailers like Home Depot, Lowe's, and other
customers. Most sales are repair and remodeling (R&R), which have
historically been more stable than new construction markets.
However, we could see some weakness in R&R, especially beginning in
2023, when backlogs decline after a period of pull forward demand
during the pandemic and consumer confidence and spending declines.
"The stable outlook reflects our view that credit metrics will
remain in line with our expectations for the rating with debt to
EBITDA around 5x."
S&P could lower its ratings on Griffon over the next 12 months if
demand in the company's end markets declines such that
-- Debt to EBITDA remains above 6x.
-- A strategic review weakens our assessment of the company's
business or financial risk.
S&P could raise its ratings on Griffon over the next 12 months if
it expects:
-- Debt to EBITDA to remain lower than 4x.
-- EBITDA margins remain above 10%.
ESG credit indicators: E-2, S-2, G-2
S&P said, "ESG factors have an overall neutral influence on our
credit rating analysis of diversified management and holding
company Griffon Corp., with products including consumer and
professional tools, home storage and organization, and garage
doors, as well as intelligence, surveillance, and communications
solutions for defense, aerospace, and commercial customers. The
manufacturing and production of these products appears light or/is
less energy intensive than that of heavy building materials
peers."
HERITAGE POWER: S&P Lowers Senior Secured Debt Rating to 'CCC'
--------------------------------------------------------------
S&P Global Ratings lowered its rating on Heritage Power LLC's
senior secured term loan B (TLB) due July 2026 and the revolving
credit facility (RCF) due July 2024 to 'CCC' from 'B-'. S&P's '3'
recovery rating is unchanged, indicating its expectation for
meaningful recovery (50%-70%; rounded estimate: 60%) in the event
of a payment default.
The negative outlook reflects S&P's expectation that the project
could default within 12 months if it is unable to extend the
maturity of its facilities and address the sustainability of its
capital structure.
Heritage is a portfolio of 16 power plants across Pennsylvania,
Ohio, and New Jersey, as well as four different zones in the PJM:
American Transmission Systems Inc. (ATSI), Mid-Atlantic Area
Council (MAAC), Eastern MAAC (EMAAC), and the remaining areas of
the regional transmission organization (RTO).
The portfolio is 100% owned by GenOn Holdings LLC. It has a total
capacity of about 2.35 gigawatts, uses technologies (such as steam
turbines and combined cycle gas turbines) designed by various
suppliers (such as GE, Siemens, and Alstom), and primarily employs
natural gas and No. 2 fuel oil. Some plants are dual-fuel capable.
-- On average, most the project's cash flows are sourced from
capacity payments.
-- The portfolio benefits from some geographic diversity because
the assets are dispersed across four different PJM zones (ATSI,
EMAAC, MAAC, and RTO).
-- Energy hedges through March 2024 for the Shawville and New
Castle plants provide energy margin downside protection.
-- The portfolio relies materially on capacity prices in PJM and
any deviation from our expectations will affect its profitability.
-- The portfolio is composed of older and less-efficient assets
with heat rates in the 10,000 British thermal unit /kilowatt per
hour (Btu/KWh)-15,000 Btu/KWh range and is unlikely to earn
material energy margin during normal times. These assets could also
be more susceptible to stricter emission requirements.
-- The high proportion of revenues sourced from capacity payments
means compliance with capacity performance rules in PJM will likely
lead to higher costs in the event of operational outages that could
detract from cash flow available for debt service (CFADS).
-- Although constructed as a portfolio, there is an overreliance
on the Shawville, New Castle, and Gilbert plants, which contribute
about 60% of aggregate CFADS for the life of the TLB.
Materially lower clearing prices will lead to an unsustainable
capital structure. The recent PJM capacity auction results will
materially lower Heritage's projected cash flows and result in an
unsustainable capital structure for the project. S&P views
Heritage's cash flows as being severely affected after 2022 given
the project's high reliance on capacity revenue, with its debt
service coverage ratio (DSCR) being below 1.0x on a sustained
basis.
S&P said, "The auction results for the 2023-2024 delivery years
were materially below our expectations, clearing at
$49.49/megawatt-day (MW-day) for EMAAC and MAAC. We had anticipated
results of about $95/MW-day and $80/MW-day, respectively, for those
two zones. We also saw some convergence in terms of pricing, given
that RTO cleared at $34.13/MW-day, which is also negative for
Heritage.
"Heritage has limited refinancing options. We also view a potential
liquidity and default event occurring within the next year, as we
now factor the maturity of the LC facility due July 2023 into our
liquidity analysis. There is $43 million outstanding on the $46
million LC facility. We view the recent unfavorable auction results
as severely limiting the options available to Heritage, either in
terms of maturity extension or refinancing.
"As a result, we now view Heritage's liquidity as less than
adequate. If the LC facility is not extended past July 2023, LC
holders could draw on their LCs, which would result in additional
pari passu loans with the TLB lenders being due within a short time
frame. We forecast Heritage will not have sufficient liquidity to
service its debt and pay down this potential additional maturity,
which could result in an event of default. We also see limited room
in terms of not breaching the DSCR covenant of 1.1x."
Total projected liquidity sources over the next year should be
about $75 million-$80 million and include a $24.4 million debt
service reserve account, $2 million available on the RCF, and CFADS
of about $50 million. This is unlikely to be sufficient to cover
the projected uses, which include debt service of about $45
million, and $43 million outstanding on the LC facility.
Hedging limits potential for higher cash flows in the near term. In
the near term, Heritage will not benefit from elevated power prices
that could help offset lower capacity revenue, given its
outstanding hedges. The project extended its heat rate call options
(HRCOs) at Shawville and New Castle to March 2024 when power prices
were weaker.
As a result, the HRCOs limit potential energy margin upside, given
that the facilities are almost fully hedged at lower prices. In
addition, Heritage has continued to experience higher-than-expected
basis leakage, which further depresses its realized energy margin.
Finally, those assets could also be exposed to higher carbon costs,
as Pennsylvania is poised to join the Regional Greenhouse Gas
Initiative. This could further challenge the assets' profitability
given that the HRCOs do not account for carbon allowances.
The negative outlook reflects the likelihood of a default or
distressed exchange within the next 12 months, barring an
unexpected positive development.
S&P said, "We could lower the rating if we believe a default over
the next six months is inevitable without an unforeseen positive
development.
"We do not expect to raise the rating over the next 12 months given
our assessment of the capital structure as unsustainable and
liquidity as less than adequate. However, we could take a positive
rating action if Heritage has a refinancing strategy in place that
would stabilize the liquidity position while addressing the
sustainability of the capital structure."
HORIZON GLOBAL: Corre Entities Report 9.9% Equity Stake
-------------------------------------------------------
In a Schedule 13D/A filed with the Securities and Exchange
Commission, these entities reported beneficial ownership of shares
of common stock of Horizon Global Corporation as of June 27, 2022:
Shares Percent
Beneficially of
Reporting Person Owned Class
---------------- ------------- --------
Corre Opportunities Qualified
Master Fund, LP 2,770,493 9.91%
Corre Partners Advisors, LLC 2,794,224 9.99%
Corre Partners Management, LLC 2,794,224 9.99%
John Barrett 2,794,224 9.99%
Eric Soderlund 2,794,224 9.99%
A full-text copy of the regulatory filing is available for free
at:
https://www.sec.gov/Archives/edgar/data/0001637655/000091957422004178/d9676269_13d-a.htm
About Horizon Global
Horizon Global -- http://www.horizonglobal.com-- is a designer,
manufacturer, and distributor of a wide variety of
custom-engineered towing, trailering, cargo management and other
related accessory products in North America, Australia and Europe.
The Company serves OEMs, retailers, dealer networks and the end
consumer.
Horizon Global reported a net loss of $33.12 million for the 12
months ended Dec. 31, 2021, compared to a net loss of $37.98
million for the 12 months ended Dec. 31, 2020. As of March 31,
2022, the Company had $488.50 million in total assets, $550.15
million in total liabilities, and a total shareholders' deficit of
$61.65 million.
INDEPENDENCE FUEL: Files Emergency Bid to Use Cash Collateral
-------------------------------------------------------------
Independence Fuel Systems, LLC asks the U.S. Bankruptcy Court for
the Eastern District of Texas, Tyler Division, for authority to use
cash collateral and provide adequate protection.
The Debtor requires use of cash collateral to make payroll and to
pay other immediate expenses to keep its doors open.
Origin Bank asserts a first lien position on all of the Debtor's
assets including, among other things the inventory and accounts
receivable of the Debtor.
An emergency exists in that the entire chance of the Debtor's
reorganizing depends on the Debtors ability to immediately obtain
use the alleged collateral of Origin to continue operations of the
companies while effectuating a plan of reorganization.
The Debtor is willing to provide Origin with replacement liens
pursuant to 11 U.S.C. section 552.
A copy of the motion and the Debtor's operating budget is available
at https://bit.ly/3Rzq1oW from PacerMonitor.com.
The Debtor projects $41,700 in total expenses.
About Independence Fuel Systems, LLC
Independence Fuel Systems, LLC owns gasoline stations. The Debtor
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. E.D. Tex. Case No. 22-60301) on July 14, 2022. In the
petition signed by Charles Neuberger, chairman of the Board of
Managers, the Debtor disclosed up to $50,000 in assets and up to
$10 million in liabilities.
Eric A. Liepins, P.C. is the Debtor's counsel.
INNOVATION PHARMACEUTICALS: Kips Bay Owns 9.9% of Class A Shares
----------------------------------------------------------------
Kips Bay Select LP disclosed in a Schedule 13G/A filed with the
Securities and Exchange Commission that as of July 5, 2022, it
beneficially owns 45,032,659 shares of Class A Common Stock of
Innovation Pharmaceuticals Inc., representing 9.92 percent of the
shares outstanding. A full-text copy of the regulatory filing is
available for free at:
https://www.sec.gov/Archives/edgar/data/1355250/000121390022037187/ea162444-sc13ga2kipsbay_inn.htm
About Innovation Pharmaceuticals
Innovation Pharmaceuticals Inc. (IPIX) -- http://www.IPharmInc.com
-- is a clinical stage biopharmaceutical company developing a
portfolio of innovative therapies addressing multiple areas of
unmet medical need, including inflammatory diseases, cancer,
infectious disease, and dermatologic diseases.
Innovation reported a net loss of $13.87 million for the year ended
June 30, 2021, a net loss of $6.65 million for the year ended June
30, 2020, and a net loss of $8.68 million for the year ended June
30, 2019. As of March 31, 2022, the Company had $11.66 million in
total assets, $5.84 million in total liabilities, and $5.82 million
in total stockholders' equity.
JBL RESTAURANT: Hires Real Estate Agents to Sell Latta Residence
----------------------------------------------------------------
JBL Restaurant Investments, Inc. seeks approval from the U.S.
Bankruptcy Court for the District of Arizona to hire Marjan Polek
and Kehaulani Kerr, real estate agents at AZ Flat Fee.
JBL requires the services of real estate agents to market for sale
a residential property located at 3222 North River Bend Place,
Tucson, Ariz. The property is owned by James Brian and Diane Latta
whose Chapter 11 case is jointly administered with that of the
company.
The fees for real estate services will be $3,800 of the gross sales
and 2.5 percent of the gross sales to the cooperating broker.
As disclosed in court filings, AZ Flat Fee is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
Marjan Polek
Kehaulani Kerr
AZ Flat Fee
3303 E Baseline Rd Suite 119
Gilbert, AZ 85234
Phone: +1 480-568-4413
About JBL Restaurant Investments
JBL Restaurant Investments, Inc. sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No.
22-00886) on Feb. 11, 2022, listing up to $50,000 in assets and up
to $500,000 in liabilities. The case is jointly administered with
the Chapter 11 case filed by James Brian and Diane Latta (Bankr. D.
Ariz. Case No. 22-02577).
Judge Brenda Moody Whinery oversees the cases.
Kasey C. Nye, Esq., at Waterfall, Economidis, Caldwell, Hanshaw &
Villamana, P.C. serves as the Debtors' legal counsel.
KINGSTON LLC: Taps Law Office of Marc S. Stern as Counsel
---------------------------------------------------------
Kingston, LLC seeks approval from the U.S. Bankruptcy Court for the
Western District of Washington to employ the Law Office of Marc S.
Stern to serve as legal counsel in its Chapter 11 case.
The firm's duties will include preparation of the schedules,
analysis of financial affairs of the Debtor, analysis of and
motions for and negotiation of the use of cash collateral,
preparation of a Chapter 11 plan, review of executory contracts,
and such other or further matters as may arise during the course of
administering the Debtor's bankruptcy case.
The Law Office of Marc S. Stern will charge these hourly fees:
Marc S. Stern, Esq. $425
Narmin Kerimova, Paralegal $125
The firm received a retainer in the amount of $8,000.
As disclosed in court filings, the Law Office of Marc S. Stern does
not have any connection representing an adverse interest to the
Debtors and their estates.
The firm can be reached through:
Marc S. Stern, Esq.
Law Office of Marc S. Stern
1825 NW 65th St
Seattle, WA 98117-5532
Tel: (206) 448-7996
Email: marc@hutzbah.com
About Kingston LLC
Kingston, LLC is primarily engaged in renting and leasing real
estate properties. It owns two properties in Kingston and
Leavenworth, Wash., having a total current value of $1.72 million.
Kingston filed a petition for relief under Subchapter V of Chapter
11 of the U.S. Bankruptcy Code (Bankr. W.D. Wash. Case No.
22-10941) on June 9, 2022, listing as much as $10 million in both
assets and liabilities. Michael S. DeLeo has been appointed as
Subchapter V trustee.
The case is assigned to Judge Timothy W. Dore.
Marc S. Stern, Esq., at the Law Office of Marc S. Stern, is the
Debtor's counsel.
KKR APPLE: S&P Affirms 'B' Issuer Credit Rating, Outlook Stable
---------------------------------------------------------------
S&P Global Ratings affirmed all its ratings on Plano, Texas-based
KKR Apple Bidco LLC (dba Atlantic Aviation), including its 'B'
issuer credit rating, 'B+' issue-level rating on the first-lien
credit facility, and 'CCC+' issue-level rating on the second-lien
credit facility. S&P assigned its '2' recovery and 'B+' issue-level
ratings to the incremental first-lien term loan, reflecting its
expectation for substantial (70%-90%; rounded estimate: 75%)
recovery in the event of a payment default.
S&P said, "The stable outlook reflects our expectation that strong
business and general aviation volumes will support pro forma
adjusted leverage reduction to the low-6x area by year-end 2022
(from 7x in 2021) and below 6x by year-end 2023, with healthy free
cash flow to debt of about 2.5%-4.
"Our ratings affirmation reflects the robust growth in private
aviation activity and Atlantic's improving market share. Atlantic's
gross profit and earnings continue to improve in line with our
prior expectations. Private aviation flight activity has surpassed
levels before the COVID-19 pandemic, supported by commercial route
consolidation and the relative safety of private travel.
Furthermore, the company has expanded its network through mergers
and acquisitions of smaller competitors, expanding its network to
101 sites from 69 at the time of the LBO by KKR in July 2021. While
fixed-base operators (FBO) acquisition purchase prices are
generally high multiples of acquired EBITDA (in the mid-teens), the
company has used a combination of cash, debt, and equity financing
to result in a relatively neutral impact to leverage. Proceeds of
the proposed transaction will be used to fund acquisitions.
"We expect pro forma adjusted leverage will decline to the low-6x
area by year-end 2022 and below 6x by year-end 2023 (from the
mid-7x area following the LBO) if gallon volumes increase in line
with our base-case GDP forecast and the company maintains its fuel
margin. Our forecast incorporates moderate execution against cost
savings and pricing enhancement opportunities provided by recent
acquisitions.
"General aviation flight activity is highly cyclical, but we
believe Atlantic's flexible cost structure would allow it to
preserve liquidity in a downturn.We forecast economic growth will
slow considerably in 2022 and 2023, and we have recently revised
our estimated probability for a recession over the next 12 months
to 40%. In the event of an economic downturn, we would expect
Atlantic's adjusted EBITDA to decline about 30% as business and
fractional flight volumes slow, affecting its fuel gross profit and
de-icing, maintenance, and concession fee revenues.
"Nevertheless, we would expect Atlantic to maintain adequate
liquidity. In our view, Atlantic's long-term hangar rental revenues
provide stability. We believe the company can reduce its direct
labor, equipment costs, facility maintenance, and growth capital
expenditures to a moderate extent in the near term. Growth capital
expenditures often include opportunistic investments in advance of
airport lease renewals, which we believe can be deferred with
limited impact to earnings. That said, over the longer term
Atlantic must invest to secure lease renewals and maintain its
scale and competitive advantage.
"Atlantic's cash flow generation should weaken modestly in 2022 due
to elevated capital and interest expense. We forecast the company
will generate adjusted free operating cash flow (FOCF) to debt of
2.5%-3% in 2022 from 4% (net of LBO transaction fees) in 2021
despite solid earnings growth. This is due to the additional
interest expense from the incremental debt issuance, higher
interest rates, rising taxable income, and a significant increase
in capital investment deferred during recent years.
"The stable outlook reflects our expectation that strong business
and general aviation volumes will support pro forma adjusted
leverage reduction to the low-6x area by year-end 2022 (from 7x in
2021) and below 6x by year-end 2023 with healthy free cash flow to
debt of about 2.5%-4%."
S&P could lower its ratings on Atlantic if adjusted leverage
exceeded the mid-7x area on a sustained basis or FOCF to debt
remained in the low-single-digit percent area. This could occur
with:
-- A severe decline in general aviation activity due to a
prolonged economic downturn;
-- High volatility in fuel prices that depressed business jet
utilization;
-- Government regulations that unexpectedly limited Atlantic's
operations, pricing policies, or industry economics; or
-- A more aggressive financial policy that included large
debt-funded shareholder returns or leveraging acquisitions.
S&P could consider raising its ratings on Atlantic if it:
-- Sustained adjusted leverage of less than 6.5x with FOCF to debt
above 5%; or
-- Continued to significantly expand its airport network and
increase market share, supporting a more favorable view of the
business.
ESG credit indicators: E-2, S-2, G-2
S&P said, "ESG factors have an overall neutral impact on our
ratings for Atlantic Aviation. While the COVID-19 pandemic
continues to impair air travel, the private jet segment was only
temporarily affected and has fully recovered over 2019 levels.
Social-distancing measures and health concerns have supported
demand for private air services."
LAFORTA-GESTAO: Cash Collateral Access, $19MM DIP Loan OK'd
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Houston Division, granted Laforta - Gestao E Investimentos
Sociedade Unipessoal LDA authority to, among other things, use cash
collateral and obtain pospetition financing, on a final basis.
The Debtor is authorized to draw an additional $19 million,
consisting of $9.5 million of new money extended by the lenders and
$9.5 million of rolled up Prepetition Senior Secured Notes held by
the Lenders, as set forth in the DIP Credit Agreement.
Under the DIP Credit Agreement, Glas USA LLC is the administrative
agent and Glas Americas LLC is the collateral agent for the
Lenders.
The Debtor is authorized to use the proceeds of the DIP Facility
solely for the purposes set forth on the DIP Budget attached to the
DIP Credit Agreement as Schedule, subject to the Permitted
Variance.
The Borrower is indebted pursuant to its guaranty of the 8.375%
Senior Secured Notes issued by the Borrower's parent entity,
Offshore Drilling Holding S.A., and governed by an Indenture dated
as of September 20, 2013, by and among the Issuer, the Guarantors
party thereto, and Deutsche Bank Trust Company Americas, as trustee
and collateral agent.
The Prepetition Senior Secured Notes are secured by
fully-perfected, first priority liens, on substantially all assets
of the Borrower.
In connection with the Chapter 11 Case, the Borrower has requested
that Lenders provide it with a debtor-in-possession credit facility
in an aggregate principal amount not to exceed $66,000,000,
consisting of a $33,000,000 fully committed, multi-draw term loan
and $33,000,000 in roll-up term loans in exchange for an equal
amount to provide funding to cover the costs, including operating
expenses and professional fees of the Chapter 11 Case and
ultimately a sale of substantially all of the Borrower's assets
under section 363 of the Bankruptcy Code.
As adequate protection for any diminution in the value of the
interests of the Prepetition Secured Parties in the collateral
securing such obligations, the Prepetition Secured Parties are
granted, subject in all cases to the Carve-Out, the following as
adequate protection:
a. the payment of the reasonable and documented out-of-pocket
fees and expenses of legal counsel and financial advisors retained
by the Backstop Lenders and the Trustee and the Noteholder
Collateral Agent (whether incurred before or after the Petition
Date) and the annual and other reasonable administrative fees of
the Trustee and the Noteholder Collateral Agent (whether incurred
before or after the Petition Date);
b. the Adequate Protection Liens, as set forth in the DIP
Credit Agreement; and
c. a superpriority administrative expense claim as
contemplated by section 507(b) of the Bankruptcy Code, which claim
will have priority over all priority claims (other than the DIP
Superpriority Claims) and unsecured claims against the Debtor and
its estate, now existing or hereafter arising, of any kind or
nature whatsoever, including, without limitation, administrative
expenses of the kinds specified in or ordered pursuant to sections
105, 326, 328, 330, 331, 503(a), 506(c), 507(a), 507(b), 546(c),
726(b), and 1114 of the Bankruptcy Code or otherwise.
A copy of the final order is available at https://bit.ly/3PujMAV
from PacerMonitor.com.
About La Forta - Gestao e Investmentos
Laforta - Gestao E Investimentos Sociedade Unipessoal LDA is a
private limited liability company organized under the laws of
Portugal. LaForta is one of three "sister" companies wholly owned
by Offshore Drilling Holding S.A. that each hold a single
ultra-deepwater semi-submersible drilling rig. LaForta owns La
Muralla IV, a ten-year old, sixth-generation, ultra-deepwater
semi-submersible drilling rig, while its sister companies own the
rigs Centenario GR and the Bicentenario. ODH is one business among
several Mexico-based companies wholly or indirectly owned by ODH's
ultimate owners.
LaForta - Gestao e Investmentos sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 22-90126).
In the petition filed by CRO David Weinhoffer, the Debtor estimated
assets between $50 million and $100 million and liabilities between
$1 billion and $10 billion.
Judge David R. Jones oversees the case.
Jackson Walker LLP, is the Debtor's counsel. Clifford Chance US LLP
is the corporate counsel. Stretto is the claims agent.
LAKES INDUSTRIAL: Unsecureds to Get Share of Income for 5 Years
---------------------------------------------------------------
Lakes Industrial, LLC, filed with the U.S. Bankruptcy Court for the
Eastern District of Michigan a Subchapter V Plan of Reorganization
dated July 12, 2022.
The Debtor filed the instant case to reorganize his debts and stop
the eviction.
Class I consists of all Allowed General Unsecured Claims. As
reported in Debtor's Schedules, Debtor estimates the amount of all
General Unsecured Claims to be $86,726.00. Holders of Allowed Class
I Claims shall receive a Pro Rata share of the Projected Disposable
Income based on all Class I Allowed Unsecured Claims. Starting one
month after the effective date, and every month thereafter the
Reorganized Debtor shall distribute all of its Projected Disposable
Income to Class I Creditors. The Monthly Payments shall continue
until the earlier of (i) payment of all Class I Claims in full or
(ii) five years have passed since the effective date of the Plan.
All monthly Payments shall be distributed to Holders of Allowed
Unsecured Claims on a pro rata basis.
The Debtor's Projected Disposable Income at approximately $1,500
per month for the first year through the fifth year. Accordingly,
total Projected Disposable Income during the five-year life of the
Plan is $90,000.00.
If the Plan is not confirmed, Debtor estimates that Class I General
Unsecured Creditors will receive a return on their Class I Claims
of between 0 and 20% of the amount of their Allowed Claim. This
Class is Impaired.
Class II consists of the Claims of Interests of Debtor. The Holders
of Allowed Interests of this Class will retain their interests in
the Reorganized Debtor in the same percentages as held in Debtor.
This Class will not be Impaired and are deemed to accept the Plan.
Upon the effective date, Debtor will become the Reorganized Debtor.
The Reorganized Debtor shall continue operating Debtor's business,
shall collect all revenues and income, and shall distribute such
revenues and income as provided under the terms of this Plan.
During the Payment Period, the Reorganized Debtor shall retain Mr.
Woody as its President. The Reorganized Debtor may retain other
employees, including Insiders, at commercially reasonable rates of
compensation.
Debtor reasonably believes that future operations will enable the
Reorganized Debtor to satisfy its obligations under the Plan.
A full-text copy of the Subchapter V Plan dated July 12, 2022, is
available at https://bit.ly/3yKoQKO from PacerMonitor.com at no
charge.
Attorney for Debtor:
David W. Brown, Esq.
Law Offices of David W. Brown, PLLC
1820 N. Lapeer Road, Suite 2A
Lapeer, MI 48446
Phone: (810) 245-6082
Email: davidbrownlaw@live.com
About Lake Industrial
Lakes Industrial, LLC, operates a specialized manufacturing
business making specialty sub-component parts of airplanes in
Lapeer, Michigan. The business was started by Robert Keefe and Gary
Woody in 2011.
Lakes Industrial, LLC, filed a petition for relief under Chapter
11, Subchapter V of the Bankruptcy Code (Bankr. E.D. Mich. Case No.
22-30541) on April 6, 2022, listing up to $50,000 in assets and up
to $100,000 in liabilities.
Judge Joel D. Applebaum oversees the case.
Mark H. Shapiro has been appointed as Subchapter V trustee.
David W. Brown, Esq., at the Law Office of David W. Brown PLLC, is
the Debtor's counsel.
MAJESTIC HILLS: Amends Township Unsecured Claim Pay Details
-----------------------------------------------------------
NVR, Inc. ("NVR") and North Strabane Township ("Township"; together
with NVR, the "Plan Proponents") submitted an Amended Disclosure
Statement to accompany First Amended Joint Chapter 11 Plan of
Liquidation for Majestic Hills, LLC, dated July 12, 2022.
The Plan provides for the liquidation and conversion of all of the
Debtor's remaining assets to Cash and the distribution of the net
proceeds realized from the sale of assets to creditors holding
Allowed Claims in accordance with the treatment set forth in the
Plan.
In addition, the Plan contemplates the creation of a Liquidation
Trust and the appointment of a Liquidation Trustee to, among other
things, resolve Disputed Claims, implement the terms of the Plan,
pursue Retained Causes of Action, make distributions, and close the
Chapter 11 Case.
The Debtor will be dissolved after all of its assets are
transferred to a Liquidation Trust. All of the Debtor's and the
Estate's assets will be transferred to a Liquidation Trust
established under the Plan to pursue the Retained Causes of Action
under the Plan. The Liquidation Trust will be controlled by a
Liquidation Trustee appointed pursuant to the Plan and overseen by
an Advisory Board comprised of three members: (i) a representative
appointed by the Committee; (ii) a representative of the Plan
Proponents; and (iii) independent member selected by the first two
members.
A percentage of the proceeds of any recoveries made by the
Liquidation Trust will be paid into an escrow account established
at the direction of the Pennsylvania Department of Environmental
Protection to fund remediation efforts.
Partial distributions will be made to Holders of Allowed Class 1
and 2 Claims as soon as practicable after the Effective Date of the
Plan in the sole discretion of the Liquidation Trustee. The Debtor
has no secured creditors that will retain liens under the Plan. For
the avoidance of doubt, all creditors in Class 1 and Class 2 under
the Plan will receive their Pro Rata share of distributions based
upon the value of their Allowed Claims as compared to the total
amount of Allowed Claims in both Class 1 and Class 2.
Class 2 consists of the Township General Unsecured Claim with the
estimated amount of not less than $4,276,320.62. The Holder of the
Allowed Township Claim will receive a pro-rata share of the Net
Liquidation Trust Assets, after accounting for the PA DEP
Remediation Set Aside, in full and final satisfaction of such
Claims.
Holders of Class 2 Claims have agreed to perform any remediation
and cleanup obligations under the Consent Order, but only to the
extent that funds become available through the PA DEP Remediation
Set Aside or other third party sources. Additionally, on the
Effective Date of the Plan, the Holders of Class 2 Claims shall pay
the Liquidation Trust Seed Funding into the Liquidation Trust.
The Amended Disclosure Statement does not alter the proposed
treatment for unsecured creditors and the equity holder:
* Holders of Allowed General Unsecured Claims will receive a
pro-rata share of the Net Liquidation Trust Assets, after
accounting for the PA DEP Remediation Set Aside, in full and final
satisfaction of such Claims.
* Equity Interests shall be extinguished with no recovery.
Each of the Homeowner's Claims was transferred to the Plan
Proponents effective January 24, 2022. For voting purposes, the
Plan Proponents shall be entitled to submit a single vote for all
of the Homeowner's Claims in the filed amount of such claims, net
of any payments made to the Homeowners by the Debtor as of the
Voting Record Date.
The Plan shall be implemented using the proceeds realized from the
liquidation of the Debtor's Assets, which are expected to be
primarily amounts recovered from the pursuit of various claims and
causes of action of the Debtor. The Plan shall be funded from the
Debtor's Assets, including any proceeds generated therefrom.
Under the Plan, the Liquidation Trustee has a ready mechanism for
funding litigation, and NVR and Township has agreed to fund the
Westfield litigation for free, subject to the right to request (not
an entitlement to) a substantial contribution award if it is able
to recover over $1 million on the claim, with such award, if it is
granted, capped at 20% of any recovery in excess of $1 million.
Additionally, the Liquidation Trustee is not entitled to receive
the statutory compensation and will only recover his or her fees
and expenses.
A full-text copy of the Amended Disclosure Statement dated July 12,
2022, is available at https://bit.ly/3Pbxp8g from PacerMonitor.com
at no charge.
Counsel to NVR, Inc., and Township of North Strabane:
Kathleen A. Gallagher, Esq.
Russell Giancola, Esq.
GALLAGHER GIANCOLA LLC
3100 Koppers Building, 426 Seventh Avenue
Pittsburgh, PA 15219
Tel: (412) 717-1920
Tel: (412) 717-1921
Email: kag@glawfirm.com
rdg@glawfirm.com
- and -
Louis T. DeLucia, Esq.
Alyson M. Fiedler, Esq.
Michael W. Ott, Esq.
ICE MILLER LLP
1500 Broadway, Ste. 2900
New York, New York 10036
Tel: (212) 835-6312
Tel: (212) 835-6315
Tel: (312) 726-7103
E-mail: Louis.DeLucia@icemiller.com
Alyson.Fiedler@icemiller.com
Michael.Ott@icemiller.com
About Majestic Hills
Majestic Hills, LLC, a privately held company that owns certain
property in Pennsylvania, filed a Chapter 11 petition (Bankr. W.D.
Pa. Case No. 20-21595) on May 21, 2020. At the time of filing,
the Debtor was estimated to have $1 million to $10 million in
assets and liabilities. The Hon. Gregory L. Taddonio oversees
the case. The Debtor's counsel is Donald R. Calaiaro of Calairo
Valencik.
MARRONE BIO: Common Stock Delisted From Nasdaq
----------------------------------------------
The Nasdaq Stock Market LLC filed a Form 25 with the Securities and
Exchange Commission notifying the removal from listing and
registration of Marrone Bio Innovations Inc.'s common stock under
Section 12(b) of the Securities Exchange Act of 1934.
About Marrone Bio Innovations
Based in Davis, California, Marrone Bio Innovations, Inc. --
http://www.marronebio.com-- discovers, develops and sells
innovative biological products for crop protection, plant health
and waterway systems treatment. The Company's products are sold
through distributors and other commercial partners to growers
around the world for use in integrated pest management and crop
protection systems that improve efficacy and increase yields and
quality while protecting the environment. Its products are often
used in conjunction with or as an alternative to other agricultural
solutions to control pests and enhance plant nutrition and health.
Marrone Bio reported a net loss of $16.55 million for the year
ended Dec. 31, 2021, compared to a net loss of $20.17 million for
the year ended Dec. 31, 2020. As of March 31, 2022, the Company had
$76.21 million in total assets, $53.34 million in total
liabilities, and $22.87 million in total stockholders' equity.
San Francisco, CA-based Marcum LLP, the Company's auditor since
2018, issued a "going concern" qualification in its report dated
March 30, 2022, citing that the Company has incurred significant
losses and needs to raise additional funds to meet its obligations
and sustain its operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
MARRONE BIO: Stockholders Approve Merger Agreement with Bioceres
----------------------------------------------------------------
At a special meeting of stockholders of Marrone Bio Innovations,
Inc., the stockholders approved:
(i) a proposal to adopt the Agreement and Plan of Merger, dated
as of March 16, 2022 (as it may be amended from time to time), by
and among Bioceres Crop Solutions Corp., BCS Merger Sub, Inc., and
Marrone; and
(ii) on a non-binding advisory basis, certain compensation that
may be paid or become payable to Marrone's named executives in
connection with the merger contemplated by the Merger Agreement.
Since there were sufficient votes represented at the special
meeting to adopt the Merger Agreement, the proposal to adjourn the
special meeting to solicit additional proxies was moot and
therefore not presented or voted on.
About Marrone Bio Innovations
Based in Davis, California, Marrone Bio Innovations, Inc. --
http://www.marronebio.com-- discovers, develops and sells
innovative biological products for crop protection, plant health
and waterway systems treatment. The Company's products are sold
through distributors and other commercial partners to growers
around the world for use in integrated pest management and crop
protection systems that improve efficacy and increase yields and
quality while protecting the environment. Its products are often
used in conjunction with or as an alternative to other agricultural
solutions to control pests and enhance plant nutrition and health.
Marrone Bio reported a net loss of $16.55 million for the year
ended Dec. 31, 2021, compared to a net loss of $20.17 million for
the year ended Dec. 31, 2020. As of March 31, 2022, the Company
had $76.21 million in total assets, $53.34 million in total
liabilities, and $22.87 million in total stockholders' equity.
San Francisco, CA-based Marcum LLP, the Company's auditor since
2018, issued a "going concern" qualification in its report dated
March 30, 2022, citing that the Company has incurred significant
losses and needs to raise additional funds to meet its obligations
and sustain its operations. These conditions raise substantial
doubt about the Company's ability to continue as a going concern.
MATHESON TRUCKING: Case Summary & 20 Largest Unsecured Creditors
----------------------------------------------------------------
Debtor: Matheson Trucking, Inc.
9785 Goethe Road
Sacramento, CA 95827
Business Description: The Debtor is a transportation and logistics
services provider.
Chapter 11 Petition Date: July 14, 2022
Court: United States Bankruptcy Court
Eastern District of California
Case No.: 22-21758
Judge: Hon. Christopher M. Klein
Debtor's Counsel: Gregory C. Nuti, Esq.
Christopher H. Hart, Esq.
Kevin W. Coleman, Esq.
NUTI HART LLP
411 30th Street, Suite 408
Oakland, CA 94609-3311
Tel: 510-506-7152
Email: gnuti@nutihart.com
chart@nutihart.com
kcoleman@nutihart.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Charles J. Mellor as chief restructuring
officer.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/C6AMHIY/Matheson_Trucking_Inc__caebke-22-21758__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. LOHF Shaiman Jacobs Legal Settlement $437,500
Hyman & Feiger PC
950 So. Cherry Street
Suite 900
Denver, CO 80246
2. Michelin Trade Debt $124,981
One Parkway South
Greenville SC 29615
Tel: 510-520-3837
3. Littler Mendelson PC Legal Settlement $100,026
P.O. Box 207137
Dallas, TX 75320-7137
4. Mahamet Camara Legal Settlement $93,750
3782 S. Genoa Circle
Unit A
Aurora CO 80013
5. Macire Diarra Legal Settlement $93,750
11149 E. 6th Place
Aurora CO 80010
6. Dean Patricelli Legal Settlement $93,750
2182 S. Yank Way
Lakewood CO 80228
7. Bemba Diallo Legal Settlement $93,750
5055 Perth Court
Denver CO 80249
8. Ardith L. Luke Legal Settlement $93,750
4495 Andes Street
Denver CO 90249
9. Andre De Oliveira Legal Settlement $93,750
10599 Clermont Way
Thornton CO 80233
10. Oraigami Risk LLC Trade Debt $84,600
PO Box 74751
Chicago, IL 60694-4751
Email: finance@origamirisk.com
11. Selly BA Legal Settlement $57,750
9100 E. Florida Ave Apt 4-103
Denver, CO 80247
12. Kenworth Sales Company Trade Debt $49,568
Dept #001
P.O. Box 27088
Salt Lake City UT 84127-0088
Tel: 801-487-4161
13. Ceridian HCM, Inc. Trade Debt $37,276
3311 East Old Shakopee Road
Minneapolis MN 55425
Email: accountsreceivable@ceridian.com
14. Salif Diallo Legal Settlement $36,000
5055 Perth Court
Denver CO 80249
15. Lohf Shaiman Jacobs Legal Settlement $32,727
Hyman & Feiger PC
950 So. Cherry Street
Suite 900
Denver CO 80246
16. Desert Fleet Serv Trade Debt $26,034
Aka WW Williams CO
7028 W Van Burent St
Phoenix AZ 85043
Tel: 602-437-7231
Email: crosales@desertlfooet-serv.com
17. Samsara Networks Inc. Trade Debt $25,215
350 Rhode Island St
4th Fl. South Building
San Francisco CA 94103
Tel: 415-985-2400
Email: accounts-receivable@samsara.com
18. Maddock Machinery Trade Debt $24,793
4795 S Julian
Tucson AZ 85714
Tel: 520-882-9531
Fax: 520-882-8366
19. MHC Kenworth Trade Debt $20,885
PO Box 879269
Kansas City MO 64187-9269
Tel: 877-642-8725
20. Peterbilt of Utah Trade Debt $20,357
P.O. Box 27634
Salt Lake City UT 84127
Tel: 801-483-8781
MUSCLEPHARM CORP: Sabina Rizvi Quits as President, CFO
------------------------------------------------------
Sabina Rizvi notified the Board of Directors of MusclePharm
Corporation of her resignation as president and chief financial
officer of the Company, effective July 22, 2022.
About MusclePharm
Headquartered in Denver, Colorado, MusclePharm Corporation
(OTCQB:MSLP) -- http://www.musclepharm.comand
http://www.musclepharmcorp.com-- is a lifestyle company that
develops, manufactures, markets and distributes branded nutritional
supplements. The Company offers a broad range of performance
powders, capsules, tablets, gels and on-the-go ready to eat snacks
that satisfy the needs of enthusiasts and professionals alike.
MusclePharm reported a net loss of $12.87 million for the year
ended Dec. 31, 2021. As of March 31, 2022, the Company had $11.98
million in total assets, $50.03 million in total liabilities, and a
total stockholders' deficit of $38.06 million.
Orange County, California-based Moss Adams LLP, the Company's
auditor since 2021, issued a "going concern" qualification in its
report dated April 15, 2022, citing that the Company has suffered
recurring losses from operations and has a net capital deficiency
that raise substantial doubt about its ability to continue as a
going concern.
NAVIENT CORP: Must Pause Post-Bankruptcy Student Loans Collection
-----------------------------------------------------------------
Daniel Gill of Bloomberg Law reports that Navient Corp. received a
court ruling that temporarily bars the student loan processing
giant from continuing to collect loan repayments from borrowers who
claim their obligations were wiped out in their personal
bankruptcy.
Judge Elizabeth Stong of the US Bankruptcy Court for the Eastern
District of New York said in a July 8, 2022 order that she was
issuing the temporary restraining order because Hilal Khalil
Homaidan, the borrower who sued Navient in a proposed class action,
will likely succeed on the merits of his case.
About Navient Solutions
Navient Solutions is the servicing unit of student loan giant
Navient Corp. (Nasdaq:NAVI). Navient Solutions is a wholly-owned
subsidiary of Navient Corp. and acts as the principal management
company for most of Navient's business activities. Navient
Solutions' servicing division manages and operates the loan
servicing functions for Navient and its affiliates.
According to PacerMonitor.com, Sarah Bannister, Brandon Hood, and
LaBarron Tate have filed an involuntary Chapter 11 petition against
Navient Solutions, LLC (Bankr. S.D.N.Y. Case No. 21-10249) on Feb.
8, 2021, saying they were owed a combined $45,684 in "overpayments"
that they say the servicer illegally collected.
The Petitioners reportedly had their private student debts
discharged in bankruptcy but have been hounded and lied to for more
than a decade to repay discharged debts.
The Petitioners' counsel:
Austin C. Smith, Esq.
Smith Law Group LLP
95 Cove Hollow Rd
East Hampton, NY 11937
E-mail: acsmithlawgroup.com
aconnellsmith@gmail.com
NEW YORK OPTICAL: Amends Plan to Include Rodenstock Unsecured Claim
-------------------------------------------------------------------
New York Optical-International, Inc., d/b/a Tuscany Eyewear,
submitted a Second Amended Disclosure Statement describing Second
Amended Plan of Reorganization dated July 12, 2022.
The Debtor obtained authority from the Court to sell the Porsche
Design Eyewear Inventory by auction pursuant to Section 363 of the
Bankruptcy Code. The entire Porsche Design Eyewear Inventory has
been sold. The sale proceeds will be used to make the Effective Day
payments required under the Plan to Chase Bank.
The remaining payments required under the Plan will be made from
the Debtor's business operations. The reduction of the Chase Bank
secured obligation by the Inventory auction will free up funds
presently used to pay the Chase loan and will allow the Debtor to
make the ongoing payments required under the Plan.
Class 3 General Unsecured Creditors:
AMEX $65,829.43
Citibank $29,077.00
Campell $643,853.32
Hall & Lamb $16,831.64
All unsecured claims allowed under §502 of the Code (with the
exception of Rodenstock, which will be paid the same percentage in
Euros), will be paid 20% of the allowed claim in 60 equal monthly
payments with no interest beginning 30 days after the effective
date of the Plan or the date on which such claim is allowed by a
final non-appealable order.
Class 4 consists of the general unsecured claim of Rodenstock GMBH
in the amount of EUR455,294.48. Rodenstock, will be paid 20% of the
allowed claim in Euros in 60 equal monthly payments with no
interest beginning 30 days after the effective date of the Plan or
the date on which such claim is allowed by a final nonappealable
order.
The Plan will be funded by the proceeds of sale of the Porsche
Design Eyewear Inventory, existing cash on hand and the operations
of the Debtor. The Plan of Reorganization is deemed by the Debtor
to be feasible.
The hearing at which the Court will determine whether to confirm
the Plan will take place on August 18, 2022 at 1:30 p.m., in
Courtroom 308, U.S. Courthouse, 299 E Broward Blvd., Ft Lauderdale
FL 33301.
Ballots must be received by August 11, 2022, to be counted as
votes. Objections to the confirmation of the Plan must be filed
with the Court and served by August 15, 2022.
A full-text copy of the Second Amended Disclosure Statement dated
July 12, 2022, is available at https://bit.ly/3cnocLP from
PacerMonitor.com at no charge.
Attorney for the Plan Proponent:
David W. Langley, Esq.
8551 W. Sunrise Blvd., Suite 303
Plantation, FL 33322
About New York Optical-International
New York Optical-International, Inc., is a Davie, Fla.-based
company that offers optical products. It conducts business under
the name Tuscany Eyewear.
New York Optical-International filed a petition for Chapter 11
protection (Bankr. S.D. Fla. Case No. 20-17961) on July 22, 2020,
listing as much as $10 million in both assets and liabilities. New
York Optical-International President Wayne R. Goldman signed the
petition.
Judge Scott M. Grossman oversees the case.
David W. Langley, Esq., is the Debtor's bankruptcy attorney while
Leto Law Firm and Alexander Duve, Esq., serve as the Debtor's
special counsel. Connolly Wasserstrom & Castillo, LLC is the
Debtor's accountant.
NINE DEGREES: Unsecured Creditors Will Get 24.72% Dividend
----------------------------------------------------------
Nine Degrees Hacking Corp., et al. filed with the U.S. Bankruptcy
Court for the Eastern District of New York a Disclosure Statement
for the Small Business Plan of Reorganization dated July 14, 2022.
The Debtors are taxi medallion corporations. The circumstances
leading to Debtors' filing under Chapter 11 were as follows: due to
the collapse of the medallion industry, the medallions ceased to be
operational and were repossessed by the medallion lender, six
months prior to the bankruptcy filing.
An action seeking a monetary judgment against the corporate debtors
and the personal guarantors, David Navaro and Orly Navaro, were
filed following the repossession, and notices of intent to sell the
medallions were issued thereafter. The corporate cases were filed
prior to the sale of the medallions.
The Disclosure Statement and Plan of Reorganization incorporate the
terms of the Settlement agreement reached between the Debtors and
Island Federal Credit Union, which was approved by the Bankruptcy
Court on June 15, 2022. The Plan contemplates the reorganization of
the Debtors' debts over the course of a 5-year period in accordance
with the proposed treatment of each class. The Plan proposes to pay
24.72% dividend of the allowed general unsecured claims.
Class 3 consists of the Unsecured claims of Island Federal Credit
Union against the Nine Degrees Hacking Corp et al. in the total
amount of $1,516,755.10. Pursuant to the Agreement, Debtors shall
pay to IFCU the sum of $375,000.00, which represents approximately
24.72% of its general unsecured claims, as follows: (i) Boyd and/or
Individual Borrowers (David Navaro and Orly Navaro) shall pay to
IFCU the sum of $125,000.00; (ii) Shulamit and/or Individual
Borrowers (David Navaro and Orly Navaro) shall pay to IFCU the sum
of $125,000.00; and (iii) Nine Degrees and/or Individual Borrowers
(David Navaro and Orly Navaro) shall pay to IFCU the sum of
$125,000.00.
Class 4 consists of Unsecured Claims of U.S. Small Business
Administration against Nine Degrees Hacking Corp. and shall be paid
24.72% dividend (3,905.76) in 24 monthly installment payments in
the amount of $162.74.
Class 4 consists of Unsecured Claims of U.S. Small Business
Administration against Boyd Taxi, Inc. and shall be paid 24.72%
dividend ($6,266.80) in 24 monthly installment payments in the
amount of $261.12.
Class 4 consists of Unsecured Claims of U.S. Small Business
Administration against Shulamit Hacking Corp and shall be paid
24.72% dividend ($5,358.10) in 24 monthly installment payments in
the amount of $223.25.
Class 5 consists of Unsecured Claim of new York State Department of
Taxation and Finance against Nine Degrees Hacking Corp. and shall
be paid 24.72% dividend ($55.74) in full on effective date of the
Plan.
Class 5 consists of Unsecured Claim of New York State Department of
Taxation and Finance against Boyd Taxi, Inc. and shall be paid
24.72% dividend ($8.55) in full on the effective date of the Plan.
Class 6 consists of Equity Interest Holders Orly Navaro and David
Navaro who will retain their interest.
The Plan will be funded from funds accumulated in the Debtor in
Possession bank accounts and from contribution of their
principals.
A full-text copy of the Disclosure Statement dated July 14, 2022,
is available at https://bit.ly/3IRsLKj from PacerMonitor.com at no
charge.
Attorneys for Debtors:
Alla Kachan, Esq.
Law Offices of Alla Kachan, P.C.
2799 Coney Island Avenue, Suite 202
Brooklyn, NY 11235
Tel: (718) 513-3145
Email: alla@kachanlaw.com
About Nine Degrees
Nine Degrees Hacking Corp. filed a petition for Chapter 11
protection (Bankr. E.D. N.Y. Case No. 21-42356) on Sept. 17, 2021,
listing up to $500,000 in assets and up to $1 million in
liabilities. David Navaro, president, signed the petition.
Judge Nancy Hershey Lord oversees the case.
The Debtor tapped the Law Offices of Alla Kachan, P.C. as legal
counsel and Wisdom Professional Services, Inc. as accountant.
NRP LEASE: Harvest Small Business Says Plan Patently Unconfirmable
------------------------------------------------------------------
Harvest Small Business Finance, LLC objects to the Disclosure
Statement for Joint Chapter 11 Plan of NRP Lease Holdings, LLC and
its Affiliated Debtors.
Harvest, is the Paycheck Protection Program ("PPP") lender on
almost $1.7 million dollars in post-petition PPP funds provided to
the Debtors following the Court's July 2, 2020 Order. Under the
July 2, 2020 Order, Harvest's loans were to be treated as a
priority administrative claim.
Harvest points out that the Debtors' Disclosure Statement
acknowledges and accepts that the PPP Loans are an administrative
claim, yet fails to treat it as such. Under 11 U.S.C. §
1129(a)(9)(a), an administrative claim (as defined in 11 U.S.C. §
507(a)(2)) "on the effective date of the plan, the holder of such
claim will receive on account of such claim cash equal to the
allowed amount of such claim." As such, Harvest's claim should be
satisfied in cash as of the effective date of the confirmed plan.
Further, Debtors do not propose a plan that provides for full
payment of Harvest's claim. Rather, Debtors propose cash payments,
over a period of 60 months for $1,354,763 of the $1,696,761.00.
With respect to the PPP loans received by 8350 Lyra and 2590 Water
Park Drive, Debtor suggests dismissing these bankruptcies so that
the SBA (not Harvest) "collect the PPP Loans made to those entities
from their assets solely."
Harvest emphatically does not agree to this treatment, as it is
entitled to a full cash payment of $1,696,761.00 for its claim at
the time of the effective date of any confirmed plan, without
having to incur additional time and money to liquidate these
assets. As a result, the proposed plan is patently unconfirmable,
given Debtors do not even propose to treat Harvest's claim as a
proper administrative claim, and the Court should reject the
Disclosure Statement.
Even if Harvest agreed to Debtors' proposed treatment of its
administrative claim (which it does not), the proposed treatment is
contradictory and confusing. The proposed plan is a consolidated
plan for each of the Debtors. However, Debtors also propose
dismissing two of the consolidated cases (related to 8350 Lyra and
2590 Water Park) following confirmation in order to allow Harvest
to seek repayment of $331,672.00 of the PPP Loans by chasing their
assets.
Moreover, the Debtors proposed substantive consolidation for
purposes of claims distribution. Debtors fail to explain how
dismissing two entities at some point post confirmation will affect
distributions to creditors or plan administration for the entities
that are not dismissed.
Harvest asserts that given this lack of clarity and contradictory
treatment, the Disclosure Statement should be rejected on the
grounds of failure to provide adequate information.
A full-text copy of Harvest's objection dated July 12, 2022, is
available at https://bit.ly/3uXL7DF from PacerMonitor.com at no
charge.
Attorneys for Harvest Small Business:
LOCKE LORD LLP
777 South Flagler Drive
Suite 215 East Tower
West Palm Beach, Florida 33401
Tel.: (561) 833-7700
Fax: (561) 655-8719
Steven J. Brotman
Florida Bar Number: 85750
steven.brotman@lockelord.com
About NRP Lease Holdings
NRP Lease Holdings, LLC, and its debtor-affiliates are privately
held companies based in Jacksonville Beach, Florida.
NRP Lease Holdings and its affiliates that have filed voluntary
petitions seeking relief under Chapter 11 of the Bankruptcy Code
(Bankr. M.D. Fla. Lead Case No. 19-04607) on Dec. 5, 2019. The
petition was signed by Henry P. Woodburn III, manager. At the time
of filing, NRP Lease and Adventure Holdings each estimated $50,000
in assets and $1 million to $10 million in liabilities.
Richard R. Thames, Esq. at THAMES MARKEY & HEEKIN, P.A., is serving
as counsel to the Debtors.
PATRIOT CREDIT: Creditors to Get Proceeds From Liquidation
----------------------------------------------------------
Patriot Credit Company LLC and its Debtor Affiliates filed with the
U.S. Bankruptcy Court for the District of Delaware a Joint
Consolidated Plan of Liquidation dated July 12, 2022.
The Debtors filed for bankruptcy after they were unable to resolve
the disputed claims of certain potential creditors arising out of
litigation occurring in New York state in a way that would allow
the Debtors to continue to realize the value of their brands. As a
result of the litigation, investors were unwilling to fund the
Debtors thereby cutting off the Debtors ability to lend and
otherwise operate.
The Debtors secured an equity infusion of $100,000.00 as well as
DIP financing of up to $200,000.00 which was provided by the DIP
Lender on a subordinated basis. Finally, Buchwald Capital Advisors
LLC was retained to investigate the claims against certain insiders
of the Debtors as well as claims the Debtors have against third
parties.
During this period, the Debtors commenced a detailed review of
their assets, principally potential third-party claims, and
determined that to the extent these claims were viable, the
funding, complexity and expense would make pursuing them in the
context of an active bankruptcy proceeding difficult.
As a consequence, the Debtors have elected to contribute all the
claims (the "Liquidating Trust Assets," "Liquidation Trust Assets"
or "Liquidated Trust Actions"), which are any Causes of Action
identified by Mr. Buchwald in his forthcoming report, to the
liquidation trust, (the "Liquidation Trust"). To fund the trust,
Auric will purchase all the Debtors' assets for $50.000.00 (the
"DIP Contribution"), both those arising before and as a product of
the bankruptcy, to Auric, including but not limited to the rights
to use the Debtors' business names and brands in the future. In
addition, Auric will retain a subordinated claim in the amount of
the funded portion of the DIP loan against the Debtors and will
share in any proceeds monetized by the Liquidation Trust with the
Unsecured Creditors on a subordinated basis.
In the post-filing period, the Debtors retained professionals to
handle the restructuring – Billion Law and CFGI -- and an
independent fiduciary to investigate certain claims that the
Debtors may have had. To the extent that the fiduciary's report
suggests that there are claims that exist, this plan provides for
those claims to be retained by a Liquidating Trust, which will be
funded by the sale of the Debtors' remaining assets, including its
good will. This Plan provides for the liquidation of the claims
that are the Debtors' primary assets, a funding source for this
process, and the continuation of the Debtors' lending operations.
Class 3 consists of General Unsecured Claims. The unsecured
distribution shall be provided via any recovery from the
Liquidation Trust. The claims of all unsecured creditors of either
debtors will be substantively consolidated and paid from the
distributions of the Liquidation Trust.
Absent further Court order, holders of Claims that are unscheduled
(or scheduled as disputed, contingent and/or unliquidated) and that
failed to file and serve a proof of Claim on or before the relevant
bar date will be forever barred, estopped, and enjoined from
asserting such Claims against the Debtors or their property.
Objections to a request for the payment of a Claim, if any, must be
Filed and served on the Debtors and the Entity asserting such Claim
within the time periods.
The Debtors are limited liability corporations organized under the
laws of the state of Delaware. As of the Effective Date, all Equity
Interests shall be deemed void, canceled, and of no further force
and effect. On and after the Effective Date, Holders of Equity
Interests shall not be entitled to, and shall not receive or retain
any property or interest in property under the Plan on account of
such Equity Interests.
The Debtors have secured DIP financing to fund their administrative
expenses; the remainder of such administrative expenses will be
satisfied as a term of going effective. As the plan is a
liquidating plan, no further payments will be made, so projections
are unnecessary, or to the extent that this is incorrect, the
projection is that the Debtors will generate $0.00 in future
revenue.
The Debtors believe that the Debtors will have enough cash on hand
on the Effective Date of the Plan to fund its administrative
obligations. The Liquidating Trust will be funded, initially, by
the funds provided by Auric for the purchase of the Debtors'
remaining assets.
Pursuant to Article 7, all assets of the Debtors not reserved for
the liquidation trust will be transferred to Auric on the Effective
Date, in exchange for Auric's contribution of the DIP Contribution
to purchase the same. The DIP Contribution will be supplied to the
Liquidation Trust to fund its efforts. Thereafter, the Debtors will
have no assets of any kind. Auric will take all assets, except the
Liquidating Trust Assets, which are transferred to the Liquidating
Trust. All assets, whether transferred to Auric or the Liquidating
Trust shall be transferred free and clear of all Claims and Equity
Interests of Creditors, Equity Interest holders, and of general
partners in the Debtor.
The Plan will be implemented by various acts and transactions as
set forth in the Plan, including, among other things, the
establishment of the Liquidation Trust, the appointment of the
Liquidation Trustee, and the making of Distributions by the
Liquidation Trust in accordance with the Plan.
A full-text copy of the Joint Liquidating Plan dated July 12, 2022,
is available at https://bit.ly/3aFecgp from PacerMonitor.com at no
charge.
Debtors' Counsel:
Mark M. Billion, Esq.
Billion, LLC
d/b/a Billion Law
1073 S. Governors Ave.
Dover, DE 19904
Tel: (302) 428-9400
Fax: (302) 674-2099
Email: markbillion@billionlaw.com
About Patriot Credit Company
Patriot Credit Company LLC and Bluefin Capital Partners, LLC, are
limited liability corporations organized under the laws of the
state of Delaware. These are two entities, owned by the same parent
company, involved in the financing of certain art related assets
that largely share liabilities.
Patriot Credit Company and Bluefin Capital Partners sought Chapter
11 bankruptcy protection (Bankr. D. Del. Lead Case No. 22-10333) on
April 14, 2022. In the petition filed by Joseph Baum, chief
restructuring officer, Patriot Credit listed assets between $10
million and $50 million and liabilities between $1 million and $10
million.
Judge Craig T. Goldblatt oversees the case.
Mark M. Billion, Esq., at Billion, LLC is the Debtors' bankruptcy
counsel.
PLATFORM II LAWNDALE: Files for Chapter 11 Bankruptcy Protection
----------------------------------------------------------------
Platform II Lawndale LLC filed for chapter 11 protection in the
Northern District of Illinois.
The Debtor disclosed $10.17 million in assets against $12.24
million of liabilities in its schedules.
The Debtor owns a self storage facility located at 1470 North
Lawndale Avenue, Chicago, Illinois, which property is valued at $10
million. Greenlake Real Estate Fund, LLC, has a $10.28 million
claim against the Debtor, which claim is secured by the property.
According to court documents, Platform LLC estimates between 1 and
49 creditors. The petition states that funds will not be available
to Unsecured Creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Aug. 18, 2022, at 1:30 PM at Appear by Telephone 341s only.
About Platform II Lawndale LLC
Platform II Lawndale LLC is a Single Asset Real Estate (as defined
in 11 U.S.C. Sec. 101(51B)). The Debtor's business involves
storing the property owned by third parties. It owns a storage
facility at its property at Lawndale Avenue, Chicago, Illinois.
Platform II Lawndale LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bank. N.D. Ill. Case No. 22-07668) on July
11, 2022. In the petition filed by Scott Krone, as manager, the
Debtor estimated assets between $10 million and $50 million and
liabilities between $50 million and $100 million.
Gregory J Jordan, of Jordan & Zito LLC, is the Debtor's counsel.
PREMIER PAVING: Seeks Cash Collateral Access
--------------------------------------------
Premier Paving, Ltd. asks the U.S. Bankruptcy Court for the
Northern District of Texas, Fort Worth Division, for authority to
use cash collateral and provide adequate protection.
The Debtor requires the use of cash collateral to pay present
operating expenses, including payroll, and pay vendors to ensure a
continued supply of materials essential to the Debtor's continued
viability.
The Debtor asserts that throughout the first and second calendar
quarters of 2022, it experienced unexpected delays in the
collection of receipts from invoices sent to some customers. This
situation was further impacted by months of low production, and low
revenue from a cold wet and long winter season for which the
company was unprepared. The company believed it could recover funds
through other jobs to bridge the shortfalls but, unfortunately,
shortages in trucks available to deliver material and weather
caused this plan to fail.
The Internal Revenue Service has filed several federal tax liens
against the Debtor based on unpaid federal taxes. The Debtor
estimates it is currently obligated to the IRS in the approximate
amount of $1,160,542.
The Debtor is the borrower pursuant to an Economic Injury Disaster
Loan (EIDL) with the Small Business Administration. Pursuant to the
EIDL Note, as modified, the Debtor is obligated to the SBA in the
approximately amount of $2,040,625. The Debtor's obligations under
the EIDL Note are secured by a blanket lien in all of the Debtor's
personal property pursuant to a Security Agreement and Amended
Security Agreement.
The Debtor is obligated pursuant to (a) a U.S. Small Business
Administration Note dated June 12, 2015, as modified by an
Amendment to Note dated July 13, 2021, in the original principal
balance of $2,880,000 payable to First National Bank of
Pennsylvania, successor by merger to Yadkin Bank; and pursuant to
(b) a U.S. Small Business Administration Note dated June 12, 2015,
as modified by an Amendment to Note dated July 13, 2021, in the
original principal balance of $350,000 payable to FNB. The Debtor
estimates it is currently obligated to FNB pursuant to the First
FNB Note in the approximate amount of $1,549,121 and pursuant to
the Second FNB Note in the approximate amount of $141,677. FNB has
filed UCC1 Financing Statements asserting a blanket lien interest
in the Debtor's assets, including in accounts.
As adequate protection, the Debtor proposes to grant replacement
liens in post-petition accounts receivable and proceeds thereof in
the same order of priority as presently existing in the Prepetition
Collateral.
The Debtor asserts that the interests of the secured creditors in
Prepetition Collateral are adequately protected.
A copy of the motion is available at https://bit.ly/3aIvhGa from
PacerMonitor.com.
About Premier Paving, Ltd.
Premier Paving, Ltd. is a Woman Owned Business that provides
asphalt paving and asphalt milling subcontractor services to
general contractors within a 100-mile radius of Fort Worth, Texas.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 22-41560-11) on July 13,
2022. In the petition signed by Herbert D. Severin, III, the Debtor
disclosed up to $50 million in both assets and liabilities.
Dylan T.F. Ross, Esq., at Forshey Prostok is the Debtor's counsel.
RED VENTURES: Fitch Updates July 6 Ratings Release
--------------------------------------------------
Fitch Ratings issued an update to a press release on Red Venture
Holdco, LP, et al., originally published July 6, 2022. The rating
actions for Red Ventures Holdco, LP, Red Ventures, LLC and New
Imagitas, Inc. are effective as of July 6, 2022.
The ratings release is as follows:
Fitch Ratings has upgraded the Long-Term Issuer Default Ratings
(IDRs) of Red Ventures Holdco, LP, Red Ventures, LLC and New
Imagitas, Inc. to 'BB-' from 'B+' following Red Ventures' creation
of a joint venture with UnitedHealth Group (UHG). In addition,
Fitch has affirmed Red Ventures, LLC's and New Imagitas, Inc.'s
senior secured debt at 'BB+'/'RR1'. The Rating Outlook is Stable.
Fitch views RVO Health's creation positively as it creates
significant cross fertilization opportunities between UHG's and RV
Health's customer base benefitting from RV Health's digital health
platform. The JV combines Red Venture's health assets (RV Health)
with UHG's Optum Health assets to form RVO Health. In consideration
for Red Ventures contributing its RH Health assets to the JV, they
received cash proceeds and interest in the RVO Health JV. RV
Health's financials will be deconsolidated from Red Ventures'
financial reporting.
KEY RATING DRIVERS
Significant Leverage Improvement: Red Ventures repaid approximately
$1.3 billion of debt (41% of total debt outstanding as of March 31,
2022) using a portion of net proceeds generated by the creation of
the RVO Health joint venture. As a result, Fitch-calculated
leverage as of March 31, 2022, pro forma for the deconsolidation of
Red Ventures' Health assets, the debt paydown and a full year of
prior acquisitions, improved to approximately 3.7x.
This debt reduction brings leverage in line with the company's
3x-4x leverage target range and was a primary driver of the
Long-Term IDR upgrade. Fitch expects Red Ventures' leverage to
remain within its new rating sensitivities despite recent softness
in the company's financial segment and Fitch's expectation for an
advertising recession in 2023.
Highly Acquisitive Strategy: Fitch expects Red Ventures will return
to making both large- and small-scale acquisitions once RVO Health
is fully established. Although Red Ventures has historically used
debt to finance some if its acquisitions, Fitch expects future
acquisitions to be funded internally given the company's improved
closing cash position and cash generation profile following RVO
Health's formation.
If Red Ventures uses debt, considering its history of delevering
after large acquisitions such as Bankrate, Healthline and CNET,
Fitch believes the company will reduce leverage to its target range
of 3x-4x over the medium term. Red Ventures also has a strong track
record of integrating its acquisitions, realizing cost
efficiencies, improving operations and growing revenue and EBITDA,
which further supports Fitch's expectation for delevering.
Capital Allocation Strategy: Fitch expects management's primary use
of FCF is for acquisitions and debt repayment. Management continues
to guide to a long-term gross leverage target range of 3.0x-4.0x.
However, it also stated it would remain opportunistic with M&A and
indicated leverage could exceed its target for the right
acquisition. While Fitch has not included capital returns to
shareholders, that remains a potential issue given the company's
private equity ownership.
Leading Customer Acquisition Platform: Red Ventures is the market
leader in screening potential customers online, using its
technology-enabled customer acquisition and marketing services
platform to deliver higher qualified leads, conversions and
retention to its partners, consistently outperforming its partners'
in-house marketing teams. Fitch notes the company has been honing
its approach to data-driven marketing using proprietary technology
refined over more than 15 years across several leading digital
brands including Bankrate, The Points Guy and CNET. Although its
product offerings can be reproduced, the company's specific
analytics capabilities and successful track record of value
creation are difficult to recreate.
Sticky Partner Relationships: The company has consistently provided
higher sales conversions and customer retention as measured by
average life time value than its partners and competitors. As a
result, eight of Red Ventures' top 10 partners having been with the
company for more than five years. Management notes the company has
never lost a partner due to poor performance.
Customer Concentration: The company's top three customers generated
26% of pro forma revenues for the LTM ended March 31, 2022, versus
22% in 2019 and 30% in 2018. Fitch expects customer concentration
will continue to decline as Red Ventures diversifies its end
markets and adds new customers via strategic acquisitions.
DERIVATION SUMMARY
Red Ventures does not have any direct peers in Fitch's rated
universe. Red Ventures' 'B+' Long-Term IDR incorporates the
company's leading position as a digital marketing services provider
that helps its clients acquire customers using proprietary
technology and data analytics.
As a result of strategic acquisitions, the company has achieved
meaningful scale even after the deconsolidation of RH Health.
Additionally, Red Ventures generates consistently strong FCF, with
recent FCF margins in the mid-teens despite broad macroeconomic
weakness and severe cyclical advertising impacts. Red Ventures'
scale, dominant market position, and strong cash flow
characteristics of the business remain positives, according to
Fitch.
Rating limitations include the sector's low barriers to entry and
modest customer and end market concentration. However, Red Ventures
has consistently refined its data-driven marketing services,
creating a long-term track record of value creation that is
difficult to replicate and was one of the drivers behind the
creation of the RVO Health JV. Additionally, Fitch sees as
positives, Red Ventures' continued push to diversify its end
markets, reducing concerns of customer concentration and
cyclicality.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer:
-- Fitch excludes the Health segment's operating performance for
2022;
-- 2022 organic revenue grows in the low teens. Fitch expects
weak growth in financials, caused by rising mortgage rates,
and declines in media & commerce, due to near-term weakness,
and education. However, strength in Red Ventures' remaining
segments, led by travel and Red Digital, more than offset the
weakness. EBITDA improves due to the revenue growth and the
swing to positive EBITDA generation by the company's startups;
-- Thereafter, total organic revenue grows in the mid-single
digits annually despite Fitch's expectations for an ad
recession in 2023. However, media & commerce's revenue growth
snaps back in 2024, in line with historical sector performance
following recessionary periods. Red Venture's startups grow in
the mid-20% range annually. Fitch-calculated EBITDA margins
return to the mid-30% range over the rating horizon;
-- Red Ventures returns to M&A activity in late 2023 completing
$1.2 billion of aggregate acquisitions at mid-teen multiples
over the rating horizon, funded with FCF;
-- Modest synergy realization and operating leverage benefits
drive a pro forma 300 bps EBITDA margin improvement;
-- Revolver and term loan maturities are extended;
-- 1% capital intensity;
-- Dividends remain minimal with low single digit annual growth;
-- Fitch-calculated leverage declines below 3.5x during 2023 and
below 3.0x thereafter.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
-- Management maintains total debt with equity credit to EBITDA
below 3.5x;
-- Operating scale improvement such that revenue grows in the
mid- to high-teens and EBITDA exceeds $650 million on an
ongoing basis.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
-- Total debt with equity credit to EBITDA increases above 4.0x ;
-- Deterioration in operating profile including a significant
slowdown in revenue and/or EBITDA growth;
-- Increased partner and end-market concentration.
BEST/WORST CASE RATING SCENARIO
International scale credit ratings of Non-Financial Corporate
issuers have a best-case rating upgrade scenario (defined as the
99th percentile of rating transitions, measured in a positive
direction) of three notches over a three-year rating horizon; and a
worst-case rating downgrade scenario (defined as the 99th
percentile of rating transitions, measured in a negative direction)
of four notches over three years. The complete span of best- and
worst-case scenario credit ratings for all rating categories ranges
from 'AAA' to 'D'. Best- and worst-case scenario credit ratings are
based on historical performance.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: At March 31, 2022, the company had
approximately $500 million in balance sheet cash, pro forma for
remaining net cash proceeds from UHG's cash payment related to the
RHO Health JV. Red Ventures also had $290 million of capacity under
its $754 million revolver.
Fitch expects Red Ventures to maintain sufficient liquidity to
support operations and debt service. Fitch expects Red Ventures
will apply FCF to debt reduction to reduce leverage and strengthen
liquidity. The revolver matures in November 2023 and the term loan
in November 2024. Fitch expects Red Ventures will refinance its
debt facilities ahead of upcoming maturities.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. 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.
ISSUER PROFILE
Red Ventures is a leading technology-enabled customer acquisition
platform that partners with companies to optimize the customer
acquisition lifecycle. Notable brands include Bankrate, The Points
Guy and CNET among several others.
DEBT RATING RECOVERY
---- ------ --------
New Imagitas, LT IDR BB- Upgrade
Inc.
senior secured LT BB+ Affirmed RR1
Red Ventures, LT IDR BB- Upgrade
LLC
senior secured LT BB+ Affirmed RR1
Red Ventures LT IDR BB- Upgrade
Holdco, LP
REVLON INC: Akin Gump Represents 2016 Term Lenders
--------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
the law firm of Akin Gump Strauss Hauer & Feld LLP submitted a
verified statement to disclose that it is representing the Ad Hoc
Group of Certain Unaffiliated 2016 Term Loan Lenders in the Chapter
11 cases of Revlon, Inc., et al.
As of July 15, 2022, members of the Ad Hoc Group and their
disclosable economic interests are:
Aegon Asset Management
6300 C Street
Cedar Rapids, IA 52499
* 2016 Term Loans: $10,324,948.07
Benefit Street Partners
9 West 57th Street, Suite 4920
New York, NY 10019
* 2016 Term Loans: $14,318,353.00
CastleKnight Management LP
810 Seventh Avenue, Suite 803
New York, NY 10019
* 2016 Term Loans: $34,880,978.00
* 2024 Unsecured Notes: $3,000,000.00
Corre Partners Management, LLC
12 East 49th Street 40th Floor
New York, NY 10017
* 2016 Term Loans: $32,375,705.76
* ABL FILO Term Loans: $8,397,218.35
* Second Lien BrandCo Facility: $12,469,869.23
* 2024 Unsecured Notes: $75,703,000.00
Ellington Management Group
711 Third Avenue
New York, NY 10017
* 2016 Term Loans: $6,837,209.00
Greywolf Loan Management LP
4 Manhattanville Road, Suite 201
Purchase, NY 10577
* 2016 Term Loans: $4,725,000.01
JP Morgan Asset Management
277 Park Avenue
New York, NY 10172
* 2016 Term Loans: $13,918,683.02
KKR Credit Advisors (US) LLC
555 California Street, 50th Floor
San Francisco, CA 94104
* 2016 Term Loans: $21,116,272.00
Livello Capital Management
1 World Trade Center, 85th Floor
New York, NY 10007
* 2016 Term Loans: $8,668,446.00
* Equity Interests: 20,000 shares
MJX Asset Management
12 East 49th Street 38th Floor
New York, NY 10017
* 2016 Term Loans: $9,478,600.30
Octagon Credit Investors, LLC
250 Park Avenue, 15th Floor
New York, NY 10177
* 2016 Term Loans: $5,430,704.00
Paloma Partners Management Company
Two American Lane
Greenwich, CT 06836
* 2016 Term Loans: $20,255,271.00
* Second Lien BrandCo Facility: $28,535,673.00
* 2024 Unsecured Notes: $22,998,000.00
* Equity Interests: 1,913 put contracts
Stone Harbor Investment Partners LP
31 West 52nd Street, 16th Floor
New York, NY 10019
* 2016 Term Loans: $5,691,104.50
Additional holders of claims against the Debtors' estates may
become members of the Ad Hoc Group, and certain members of the Ad
Hoc Group may cease to be members in the future. Akin Gump reserves
the right to amend or supplement this Verified Statement in
accordance with the requirements set forth in Bankruptcy Rule
2019.
Counsel to the Ad Hoc Group of Certain Unaffiliated 2016 Term Loan
Lenders can be reached at:
AKIN GUMP STRAUSS HAUER & FELD LLP
Michael S. Stamer, Esq.
Abid Qureshi, Esq.
Joseph L. Sorkin, Esq.
One Bryant Park
New York, NY 10036
Telephone: (212) 872-1000
Facsimile: (212) 872-1002
E-mail: mstamer@akingump.com
aqureshi@akingump.com
jsorkin@akingump.com
- and -
James Savin, Esq.
2001 K Street, N.W.
Washington, D.C. 20006
Telephone: (202) 887-4000
Facsimile: (202) 887-4288
E-mail: jsavin@akingump.com
A copy of the Rule 2019 filing is available at
https://tinyurl.com/bdewux5c at no extra charge.
About Revlon Inc.
Revlon Inc. manufactures, markets and sells an extensive array of
beauty and personal care products worldwide, including color
cosmetics; fragrances; skin care; hair color, hair care and hair
treatments; beauty tools; men's grooming products; anti-perspirant
deodorants; and other beauty care products. Today, Revlon's
diversified portfolio of brands is sold in approximately 150
countries around the world in most retail distribution channels,
including prestige, salon, mass, and online.
Since its breakthrough launch of the first opaque nail enamel in
1932, Revlon has provided consumers with high quality product
innovation, performance and sophisticated glamour. In 2016, Revlon
acquired the iconic Elizabeth Arden company and its portfolio of
brands, including its leading designer, heritage and celebrity
fragrances.
Revlon is among the leading global beauty companies, with some of
the world's most iconic and desired brands and product offerings in
color cosmetics, skin care, hair color, hair care and fragrances
under brands such as Revlon, Revlon Professional, Elizabeth Arden,
Almay, Mitchum, CND, American Crew, Creme of Nature, Cutex, Juicy
Couture, Elizabeth Taylor, Britney Spears, Curve, John Varvatos,
Christina Aguilera and AllSaints.
Revlon, Inc., sought Chapter 11 protection (Bankr. S.D.N.Y. Case
No. 22-10760) on June 15, 2022. Fifty affiliates, including Almay,
Inc, Beauty Brands USA, Inc., and Elizabeth Arden, Inc., also
sought bankruptcy protection on June 15 and June 16, 2022.
Revlon disclosed total assets of $2,328,093,000 against total
liabilities of $3,689,240,395 as of April 30, 2022.
The Hon. David S. Jones is the case judge.
PJT Partners is acting as financial advisor to Revlon and Alvarez &
Marsal is acting as restructuring advisor. Paul, Weiss, Rifkind,
Wharton & Garrison LLP is acting as legal advisor to the Company.
Mololamken, LLC, is the conflicts counsel. Kroll, LLC, is the
claims agent.
RIGHT ON BRANDS: Incurs $257K Net Loss in FY Ended March 31
-----------------------------------------------------------
Right On Brands, Inc. filed with the Securities and Exchange
Commission its Annual Report on Form 10-K disclosing a net loss
attributable to the company of $257,016 on $997,100 of revenues for
the year ended March 31, 2022, compared to a net loss attributable
to the company of $1.85 million on $77,960 of revenues for the year
ended March 31, 2021.
As of March 31, 2022, the Company had $234,131 in total assets,
$800,059 in total liabilities, and a total stockholders' deficit of
$565,928.
Dallas, Texas-based Turner, Stone & Company, L.L.P., the Company's
auditor since 2019, issued a "going concern" qualification in its
report dated July 8, 2022, citing that the Company has suffered
significant losses from inception and had a significant loss from
operations. These conditions raise substantial doubt about its
ability to continue as a going concern.
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1580262/000147793222004928/rton_10k.htm
About Right on Brands, Inc.
Right on Brands, Inc.'s business is conducted through its
wholly-owned subsidiaries, Humbly Hemp, Endo Brands, and Humble
Water Company. Humbly Hemp sells and markets a line of hemp
enhanced snack foods. Humble Water Company is in a partnership
with Springhill Water Co. to develop a line of High Alkaline,
Natural Mineral Water, and a bottling and packaging facility.
Endo Brands creates and markets a line of CBD consumer products and
through ENDO Labs, a joint venture with Centre Manufacturing,
creates white label products and formulations for CBD brands.
Right On Brands is at the focus of health and wellness.
ROCKY MOUNTAIN: Wins Cash Collateral Access Thru Aug 5
------------------------------------------------------
The U.S. Bankruptcy Court for the District of Colorado authorized
Rocky Mountain Homecare, Inc. to use cash collateral on an interim
basis in accordance with the budget, with a 15% variance, through
August 5, 2022.
In exchange for the use of cash collateral during the Interim
Period, the Debtor's secured creditor, McKesson, will receive
adequate protection as follows:
a. Replacement liens on all post-petition tangible and
intangible personal property of the Debtor, including without
limitation all goods, inventory, fixtures, equipment, instruments,
chattel paper, accounts, deposit accounts, and accounts receivable,
as well as proceeds of the foregoing, to the extent that the use of
cash results in a decrease in the value of the Secured Creditor's
interest in its collateral pursuant to 11 U.S.C. section 361(2).
b. All replacement liens will hold the same relative priority
to assets as did the pre-petition liens;
c. The Debtor will keep the Secured Creditor's collateral
fully insured;
d. The Debtor will provide the Secured Creditor with a
complete accounting, on a monthly basis, of all revenue,
expenditures, and collections by category listed in the Budget
through the timely filing of the Debtor's Monthly Operating
Reports;
e. The Debtor will maintain in good repair all of the Secured
Creditor's collateral;
f. The Debtor has agreed to a deferral of insider salaries for
the month of July 2022 only in the total gross amount of $3,500 to
be paid only upon the effective date of a plan of reorganization.
Under any other outcome in the case (e.g., a liquidating plan or
conversion), such deferred salary will be subordinated to
McKesson's claim.
A final hearing on the matter is scheduled for August 5 at 11 a.m.
A copy of the order and the Debtor's budget for July 1 to August 5,
2022 is available at https://bit.ly/3nZySmc from PacerMonitor.com.
The budget provides for total expenses, on a weekly basis, as
follows:
$5,623 for the week ending July 7, 2022;
$15,263 for the week ending July 14, 2022;
$5,623 for the week ending July 21, 2022;
$5,623 for the week ending July 28, 2022; and
$11,498 for the week ending August 5, 2022.
About Rocky Mountain Homecare
Rocky Mountain Homecare, Inc., filed a petition for relief under
Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. D. Colo.
Case No. 22-12306) on June 28, 2022. In the petition filed by Joey
Gallegos, as operations manager, the Debtor estimated assets up to
$50,000 and liabilities between $1 million and $10 million.
Mark David Dennis has been appointed as Subchapter V trustee.
Jenny M.F. Fujii, Esq., at Kutner Brinen Dickey Riley, P.C., is the
Debtor's counsel.
SCHRILLO COMPANY: Unsecureds Will Get 100% in Subchapter V Plan
---------------------------------------------------------------
Schrillo Company, LLC, filed with the U.S. Bankruptcy Court for the
Central District of California a Subchapter V Plan of
Reorganization dated July 12, 2022.
The Debtor elected to seek protection in Chapter 11 to pursue a
prompt and efficient reorganization in which it would seek a sale
of substantially all of its assets as a going concern ("Sale") and,
if the Sale is successful, pay its creditors in full. With
confirmation of this Plan, the Debtor believes that this goal will
be achieved.
At the time of filing, Debtor's management believed that the value
of the company, if sold quickly, would be sufficient to pay off all
creditors in full. The Debtor also believed that its existing
infrastructure and human capital might have value for investors
that wish to acquire the company for design and manufacturing
projects in addition to the hard assets proposed for Sale.
The Debtor's bet proved correct, as the Sale attracted great
interest, and at auction the Debtor was valued and its assets
purchased as a going concern by Learjet Inc. for $4,000,000. The
Sale to Learjet Inc. is pending, and closing is anticipated before
the end of July 2022.
On July 7, 2022, the auction was conducted before the Bankruptcy
Court, and Learjet Inc. was the successful bidder at the auction.
On July 11, 2022, the Court entered the Sale Order, approving the
Sale to Learjet Inc. The Plan provides for the distribution to
creditors and administration of all remaining assets of the Debtor,
including the Cash from the Sale and any assets excluded from the
Sale.
Class 3 consists of all General Unsecured Claims (Vendor Claims).
Each Holder of a Allowed Class 3 General Unsecured Claim (Vendor
Claims) shall receive, in full and complete satisfaction,
settlement, discharge, and release of, and in exchange for, its
Allowed Class 3 General Unsecured Claim (Vendor Claim), an
assignment of funds from Realty's Class 2 Secured Claims
distribution (or such additional funds as may be provided by
Realty) equal to the total amount of its Allowed Class 3 General
Unsecured Claims (Vendor Claims). The Debtor estimates based solely
on its schedules and the Claims filed to date of the filing of this
Plan, not including any Class 4 Rejection Claims and Class 5
Convenience Class Claims, that the amount of Allowed General
Unsecured Claims (Vendor Claims) is approximately $305,000. Class 3
is Impaired. This Class will receive a distribution of 100% of
their allowed claims.
Class 3A consists of all Class 3 Allowed General Unsecured Claims
(Vendor Claims) assigned to Realty in accordance with this Plan.
Each Holder of a Allowed Class 3A General Unsecured Claim (Assigned
Claims) shall receive, in full and complete satisfaction,
settlement, discharge, and release of, and in exchange for, its
Allowed Class 3A General Unsecured Claim (Assigned Claim), its
share of Debtor's projected Disposable Income, divided pro rata by
and amongst Allowed Class 3A General Unsecured Claims (Assigned
Claims), Allowed Class 4 General Unsecured Claims (Rejection
Claims) and Allowed Class 5 General Unsecured Claims (Realty
Claims). The Debtor estimates based solely on its schedules and the
Claims filed to date of the filing of this Plan, not including any
Rejection Claims and Convenience Class Claims, that the amount of
Allowed Class 3A General Unsecured Claims (Assigned Claims) is
$305,000. Class 3A is Impaired. This Class will receive a
distribution of 100% of their allowed claims.
Class 4 consists of all Class 4 Allowed General Unsecured Claims
(Rejection Claims). Each Holder of a Class 4 Allowed General
Unsecured Claim (Rejection Claims) shall receive, in full and
complete satisfaction, settlement, discharge, and release of, and
in exchange for, its Class 4 Allowed General Unsecured Claim
(Rejection Claims), divided pro rata by and amongst Allowed Class
3A General Unsecured Claims (Assigned Claims), Allowed Class 4
General Unsecured Claims (Rejection Claims) and Allowed Class 5
General Unsecured Claims (Realty Claims). The Debtor estimates
based solely on its schedules and the claims filed to date of the
filing of this Plan, that the amount of Class 4 Allowed General
Unsecured Claim (Rejection Claims) is anywhere from zero to
$150,000. Class 4 is Impaired. This Class will receive a
distribution of 100% of their allowed claims.
Class 5 consists of all Allowed Class 5 General Unsecured Claims
(Realty Claims). Each Holder of a Allowed Class 5 General Unsecured
Claim (Realty Claims) shall receive, in full and complete
satisfaction, settlement, discharge, and release of, and in
exchange for, its Allowed Class 5 General Unsecured Claim (Realty
Claims), divided pro rata by and amongst Allowed Class 3A General
Unsecured Claims (Assigned Claims), Allowed Class 4 General
Unsecured Claims (Rejection Claims) and Allowed Class 5 General
Unsecured Claims (Realty Claims). The Debtor estimates based solely
on its schedules and the claims filed to date of the filing of this
Plan, that the amount of Class 5 Allowed General Unsecured Claims
(Realty Claims) is approximately $1,097,653.00. Class 5 is
Impaired. This Class will receive a distribution of 100% of their
allowed claims.
Class 6 consists of all holders of Allowed Class 6 Convenience
Class Claims. Each Holder of an Allowed Class 6 Convenience Claim
shall receive, in full and complete satisfaction, settlement,
discharge, and release of, and in exchange for, its Allowed Class 6
Convenience Claim, payment in full on its Claim, without interest.
Payment shall be made promptly upon the occurrence of the Effective
Date, but in no event later than 14 days after the Effective Date.
The Debtor estimates based solely on its schedules and the claims
filed to date of the filing of this Plan, that the amount of
Allowed Class 6 Convenience Class Claims is approximately $35,000.
Class 6 is Impaired. This Class will receive a distribution of 100%
of their allowed claims.
Class 7 consists of all Interests in Debtor. Holders of Interests
in Debtor shall retain such Interests. Class 7 is Unimpaired.
The Debtor anticipates that all Distributions made under the Plan
will be funded from the Cash on hand, the assigned Allowed Class 2
Secured Claim of Realty, and future earnings, which will not be
less than 100% of the Debtor's projected Disposable Income for the
Commitment Period. However, the Debtor reserves the right to make a
lump sum payment during the Commitment Period.
The Reorganized Debtor will carry on any business, purpose or
activity for which limited liability companies may lawfully conduct
in the State of California. Payment of those amounts to conduct
such lawful business, purpose or activity shall be included in the
Reorganized Debtor's operating expenses, before any calculation of
Disposable Income. For avoidance of doubt, the Reorganized Debtor
will no longer be engaged in the Debtor's core business of
designing and manufacturing ball screws, jackscrews, lead screws,
linear actuators and other products for sale to the aerospace
industry.
A full-text copy of the Subchapter V Plan dated July 12, 2022, is
available at https://bit.ly/3PyhlgF from PacerMonitor.com at no
charge.
Attorneys for Debtor:
Leib M. Lerner, Esq.
Douglas J. Harris, Esq.
Alston & Bird LLP
333 S. Hope Street, 16th Floor
Los Angeles, CA 90071
Telephone: (213) 576-1000
Email: leib.lerner@alston.com
Email: alina.ananian@alston.com
About Schrillo Company
Schrillo Company, LLC, is a manufacturer of ball screws, acme
screws, lead screws, torsion bars, and extension tubes. Schrillo
Co specializes in precision manufacturing equipment targeting the
aviation, military, and space industries. Its principal office is
located in North Hills, California.
Schrillo Company filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. C.D. Cal. Case No.
22-10444) on April 13, 2022, listing up to $10 million in both
assets and liabilities. Jeri Nowlen, chief executive officer,
signed the petition.
Alston & Bird, LLP, serves as the Debtor's legal counsel.
SECURE ENERGY: S&P Affirms 'B' ICR, Outlook Positive
----------------------------------------------------
S&P Global Ratings affirmed its issuer credit rating on Secure
Energy Services Inc., a Calgary, Alta.-based provider of oilfield
services, at 'B'. At the same time, S&P affirmed the issue-level
rating on the company's senior secured second-lien notes at 'BB-'
and the issue-level rating on the senior unsecured notes at 'B'.
The positive outlook reflects the potential for an upgrade in the
next 12 months, if the company continues to perform in line with
its current expectations, with an adjusted funds from operations
(FFO)-to-debt ratio averaging 30% over the next two years, and
availability under the credit facility improves.
S&P said, "Although we expect higher cash flow generation and
improved leverage metrics, the high drawn amount under the credit
facility constrains rating upside. We expect the company's revenues
will increase by 25% in 2022 compared with pro forma 2021 levels,
with further growth expected in 2023. The improvement is primarily
led by the higher activity levels, underpinned by higher oil and
gas prices. Accordingly, we expect higher cash flow generation,
with adjusted FFO to debt expected to average 30% in the next two
years. While our estimates do not assume any material dispositions
relating to the remaining issues being considered by the
Competition Bureau on the integration with Tervita Corp., we
believe any possible impact from asset sales, if required, should
be modest on cash flow generation."
Despite the improvement in credit measures, upside is limited given
the high drawn amount under the credit facility, which reduces
liquidity sources available to offset unanticipated operational or
market events. As of March 31, 2022, the credit facility was about
55% utilized (including letters of credit). While S&P projects
positive free operating cash flows in the range of C$225 million to
C$250 million annually over the next two years and assume
management will continue to focus on debt reduction as publicly
stated and as demonstrated in the first quarter (repaid C$90
million), in S&P's view, the currently high drawn amount under the
credit facility provides less cushion to counter unforeseen
events.
Following the successful integration with Tervita, Secure is the
leading environmental solutions producer in Western Canada,
primarily serving the volatile oil and gas sector. Secure services
a diversified customer base across key active plays (Montney,
Duvernay, Deep Basin, Viking, and Oil Sands). It has a broad
product offering, with a substantial portion of its revenues
derived from production-related activity. In addition, the company
has complementary midstream services, a portion of which is
contracted. These include the Kerrobert Light Pipeline system and
the East Kaybob oil pipeline, both of which are contracted for more
than 10 years. In addition, several of the company's water disposal
facilities also have long-term contracts for minimum volumes. In
S&P's view, the long-term contracts and exposure to
production-related activity provide some degree of resiliency in a
volatile hydrocarbon environment.
In addition, the company has a flexible cost structure, with the
majority of the costs being variable (primarily personnel), which
provides the ability to temper margin volatility. Although S&P
expects inflationary pressures on raw materials and labor costs to
persist, it believes management should be able to maintain EBITDA
margins at about 30% as price increases are implemented,
effectively offsetting the impact of cost inflation. At the same
time, margins should benefit from higher utilization and efficiency
following Secure's consolidation with Tervita in July 2021. The
company has so far realized more than two-thirds of its targeted
synergies of C$75 million, primarily attributed to overhead and
facility rationalizations. These factors support S&P's assessment
of the company's profitability (based on EBITDA margins over a
five-year period) in the above-average range of its global peer
group.
That said, upside to the business risk assessment is limited, given
the limited product differentiation and pricing power for the
services provided as well as our expectation for continued EBITDA
volatility directly linked to the hydrocarbon price cycle.
S&P said, "The positive outlook reflects our view that Secure will
generate an adjusted FFO-to-debt ratio averaging 30% over the next
two years, supported by rising activity levels underpinned by the
ongoing strength in oil and natural gas prices as well as synergy
realization. The outlook also reflects the potential for an upgrade
if the company continues to prioritize debt repayment and reduces
amounts drawn under the credit facility.
"We could revise the outlook to stable if Secure's FFO to debt
deteriorated to the lower end of the 12%-20% range, with no
prospects of improving. This would most likely occur from weakness
in commodity prices that leads to additional and prolonged cutbacks
in E&P spending, reducing demand for Secure's services.
"We would raise our rating on Secure, if the company is able to
reduce borrowing under its credit facility, thereby increasing
total sources of liquidity. In addition, we would expect no
material asset dispositions to occur with the completion of the
Competition Bureau's ongoing review. We would also expect the
company to maintain its adjusted FFO-to-debt ratio above 20% on a
sustained basis."
ESG credit indicators: E-4, S-2, G-2
S&P said, "Environmental factors are a negative consideration in
our credit rating analysis of Secure Energy Services Inc. Although
the majority of Secure's revenues are from environmental solutions,
the company's cash flows rely on oil and gas activity levels.
Accordingly, energy transition and accelerating adoption of
renewable energy will result in lower demand for oil field services
in the long term, and is reflected in our industry risk assessment,
and the credit rating."
SEMILEDS CORP: Incurs $911K Net Loss in Third Quarter
-----------------------------------------------------
SemiLEDs Corporation filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $911,000 on $1.78 million of net revenues for the three months
ended May 31, 2022, compared to a net loss of $57,000 on $1.44
million of net revenues for the three months ended May 31, 2021.
For the nine months ended May 31, 2022, the Company reported a net
loss of $1.59 million on $5.43 million of net revenues compared to
a net loss of $1.02 million on $3.36 million of net revenues for
the nine months ended May 31, 2021.
As of May 31, 2022, the Company had $16.43 million in total assets,
$12.94 million in total liabilities, and $3.49 million in total
equity.
As of May 31, 2022 and Aug. 31, 2021, the Company had cash and cash
equivalents of $3.0 million and $4.8 million, respectively, which
were predominately held in U.S. dollar denominated demand deposits
and/or money market funds.
As of July 6, 2022, the Company had no available credit facility.
The Company suffered losses from operations of $3.9 million and
$2.1 million, and net cash used in operating activities of $1.7
million and $1.0 million for the years ended Aug. 31, 2021 and
2020, respectively. The Company said these facts and conditions
raise substantial doubt about its ability to continue as a going
concern, even though gross profit on product sales was $1.0 million
for the year ended Aug. 31, 2021 compared to $1.6 million for the
year ended Aug. 31, 2020. Loss from operations for the three and
nine months ended May 31, 2022 was $774,000 and $2.1 million,
respectively. Net cash used in operating activities for the nine
months ended May 31, 2022 was $1.9 million. Moreover, at May 31,
2022, the Company's cash and cash equivalents had decreased to $3.0
million. Management believes that it has developed a liquidity
plan, as summarized below, that, if executed successfully, should
provide sufficient liquidity to meet the Company's obligations as
they become due for a reasonable period of time, and allow the
development of its core business.
SemiLeds said, "While the Company's management believes that the
measures described in the above liquidity plan will be adequate to
satisfy its liquidity requirements for the twelve months after the
date that the financial statements are issued, there is no
assurance that the liquidity plan will be successfully implemented.
Failure to successfully implement the liquidity plan may have a
material adverse effect on its business, results of operations and
financial position, and may adversely affect its ability to
continue as a going concern."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1333822/000095017022012621/leds-20220531.htm
About SemiLEDs
Headquartered in Miao-Li County, Taiwan, R.O.C., SemiLEDs --
http://www.semileds.com-- develops and manufactures LED chips and
LED components for general lighting applications, including street
lights and commercial, industrial, system and residential lighting,
along with specialty industrial applications such as ultraviolet
(UV) curing, medical/cosmetic, counterfeit detection, horticulture,
architectural lighting and entertainment lighting.
SemiLEDs reported a net loss of $2.86 million for the year ended
Aug. 31, 2021, compared to a net loss of $547,000 for the year
ended Aug. 31, 2020. As of Nov. 30, 2021, the Company had $17.47
million in total assets, $13.32 million in total liabilities, and
$4.15 million in total equity.
Diamond Bar, California-based KCCW Accountancy Corp., the Company's
auditor since 2019, issued a "going concern" qualification in its
report dated Dec. 29, 2021, citing that the Company incurred
recurring losses from operations and has an accumulated deficit,
which raises substantial doubt about its ability to continue as a
going concern.
SIMPLY GOOD: S&P Ups ICR to 'BB-' on Deleveraging, Outlook Stable
-----------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on U.S.-based
The Simply Good Foods Co. to 'BB-' from 'B+'. At the same time, S&P
raised its issue-level ratings on the senior secured credit
facilities to 'BB+' from 'BB'.
The stable outlook reflects the company's favorable market position
in the health and wellness food and snacking industry, which should
support continued strong revenue growth and healthy free operating
cash flow (FOCF) generation in fiscal 2023. Although leverage could
temporarily rise to pursue debt-financed acquisitions, the company
has demonstrated the ability to quickly deleverage and maintain
leverage within or below its stated target range of 3x-4x.
The upgrade reflects the company's rapid deleveraging and sustained
organic revenue growth over the past few years. Simply Good quickly
paid down debt and reduced leverage after its $1 billion
acquisition of Quest. Thereafter, its profitability continued to
grow, reaching adjusted EBITDA of over $200 million for the fiscal
year ended August 2021. The company's EBITDA continues to expand in
fiscal 2022 and we forecast EBITDA exceeding $220 million, despite
a slowdown in Atkins sales and inflationary pressures. S&P Global
Ratings-adjusted leverage was 1.9x for the 12-months ended May 28,
2022 as compared with 3.5x for the same prior year period.
S&P said, "The company had $177 million of warrant liabilities that
we had previously treated as debt exercised on a cashless basis in
the second quarter of fiscal 2022. In addition, Simply Good repaid
$50 million on its term loan facility during its fiscal third
quarter, bringing the remaining balance down to $406.5 million from
$660 million initially when it acquired Quest brands. We expect the
company will continue using free cash flow for some debt repayment
in the fourth quarter, along with modest share repurchases. The
company has employed a less aggressive financial policy since the
purchase of Quest, and while we expect leverage will increase in
the future for acquisitions, the company has demonstrated a track
record of being able to quickly deleverage and maintain leverage
within or below its publicly stated target range of 3x-4x." Simply
Good repriced its term loan facility earlier this year, reducing
interest expense and extended the maturity on its revolving credit
facility to 2026, further benefiting cash flow and liquidity.
Simply Good has experienced strong double-digit revenue growth in
fiscal 2022, successfully implementing price increases to offset
inflationary pressures. The company raised prices in the
high-single-digit percentages in September 2021 and announced a
second price increase of similar magnitude that will go into effect
as of Aug. 1. S&P said, "We expect modest customer elasticity
because the weight management and nutritional snacking categories
do not have a lot of competition from private label brands, and
Simply Good has a more affluent customer base. We believe the
company could take additional pricing actions to offset further
higher prices for commodities. The Quest business benefited in the
third quarter from the price increase and higher volumes because a
larger portion of overall revenue from Quest comes from high growth
snacks and confectionery, and we expect continued double-digit
revenue growth from Quest in fiscal 2023. Higher exposure to
e-commerce also supports continued strong revenue growth from
Quest."
S&P said, "We expect slower growth from the Atkins brand, in the
low-single-digit percentage area, in fiscal 2023, as consumer
mobility slowly returns, and consumption levels remain subdued
because of consumers' continued lack of focus on weight management.
The company did experience slower retail takeaway in the third
quarter because of lower demand and higher inventory levels at
retail customers, but we expect underlying demand trends are still
healthy, as the company lapped tough comparisons in the quarter,
and household penetration rates are steadily improving. "We believe
the company can still maintain solid profitability with sustained
lower growth of the Atkins brand in at least the low-single-digit
range. Overall, we expect 14%-15% revenue growth for Simply Good in
fiscal 2022 and high-single-digit percent growth in fiscal 2023, as
the company increases prices, achieves volume gains from high
growth products such as Quest tortilla chips and peanut butter
cups, has continued strong performance from the e-commerce channel,
and continues to innovate with new products. We believe in a
recessionary environment there could be some pullback or trade
down, but the company would still experience steady demand as
snacking trends have historically performed well during a
recession, and the company's premium products attract relatively
higher income customers.
"We forecast steady margin performance for the company, with EBITDA
growth largely in line with revenue growth. We expect gross margin
declines of roughly 250 basis points for the company in fiscal 2022
as a result of higher input costs for commodities such as proteins,
cocoa, and soy, as well as higher packaging costs. Total gross
profit dollars have been insulated through price increases,
however, and we expect the company would take additional pricing
actions if commodity prices continued to increase. We anticipate
modest gross margin improvement in fiscal 2023 as input costs begin
to decrease. The company was able to largely offset gross margin
percentage declines with lower selling, general and administrative
expenses as a percentage of revenue through fiscal 2022. We expect
increased marketing spend in fiscal 2023, to be offset by continued
leverage from general and administrative expenses as the business
continues to achieve benefits of scale, in addition to the above
mentioned gross margin improvement, will lead to modest EBITDA
margin improvement overall for the company in fiscal 2023. We
expect EBITDA growth in the high-single-digit percentages in fiscal
2023, in line with revenue growth."
The company's strong brands and asset-light model supports strong
cash flow generation and downside protection. Simply Good holds a
strong market position in the extremely crowded nutritional
snacking category. The company's sales are concentrated with the
Atkins and Quest brand names, which leaves it vulnerable to
reputational damage or changing consumer tastes and preferences.
The asset-light business model limits its fixed overhead and
provides greater flexibility and downside protection if demand is
soft. The company's marketing budget is a significant portion of
operating expenses, but it has been effective and is necessary to
communicating and positioning Atkins as a lifestyle brand. The
Quest brand, which caters to a younger demographic, uses more
social media marketing but should be supported with broader
marketing to drive growth as well. S&P said, "We expect the company
to continue to invest heavily in its brands and increase household
penetration rates. The company has experienced higher-than-normal
levels of working capital use in fiscal 2022, due to inventory
building and higher receivables, and we expect more normal levels
of working capital in fiscal 2023. We forecast Simply Good will
generate at least $150 million of FOCF over the next 12 months."
The stable outlook reflects the company's favorable market position
in the health and wellness snacking industry, which should support
continued strong revenue growth and healthy FOCF generation in
2023. Although leverage could temporarily rise if the company
pursued debt-financed acquisitions, it has demonstrated the ability
to quickly deleverage and maintain leverage within or below its
stated target range of 3x-4x.
S&P could lower the ratings if the company's leverage rose and was
sustained above 4x. This could happen if:
-- It made another debt-financed acquisition more leveraging than
its Quest acquisition or encountered unexpected integration
challenges with its next acquisition;
-- Inflation worsened and the company could not offset the higher
costs, significantly compressing margin; or
-- The company lost market share to competitors.
S&P could raise the ratings if:
-- The company adopted less-aggressive financial policies, and
revised its publicly stated leverage target to well below 3x,
incorporating periodic spikes for acquisitions; or
-- It increased scale and product diversity.
ESG credit indicators: E-2, S-2, G-2
SINTX TECHNOLOGIES: Has Until Jan. 2 to Comply With Nasdaq Rule
---------------------------------------------------------------
SINTX Technologies, Inc. received notification from the NASDAQ
Stock Market, indicating that the Company will have until Jan. 2,
2023, to regain compliance with NASDAQ's $1.00 minimum bid
requirement.
The notification indicated that the Company did not regain
compliance during the initial 180-day grace period provided under
the rule. In accordance with NASDAQ Marketplace Rule
5810(c)(3)(A), the Company is eligible for the additional grace
period because it meets the continued listing requirement for
market value of publicly held shares and all other applicable
requirements for initial listing on the Nasdaq Capital Market with
the exception of the bid price requirement, and provided written
notice of its intention to cure the deficiency during the second
compliance period by effecting a reverse stock split, if
necessary.
About SINTX Technologies
Headquartered in Salt Lake City, Utah, SINTX Technologies --
https://ir.sintx.com -- is an OEM ceramics company that develops
and commercializes silicon nitride for medical and non-medical
applications. The core strength of SINTX Technologies is the
manufacturing, research, and development of silicon nitride
ceramics for external partners. The Company presently manufactures
advanced ceramics powders and components in its FDA registered, ISO
13485:2016 certified, and ASD9100D certified manufacturing
facility.
SINTX reported a net loss of $8.78 million for the year ended Dec.
31, 2021, a net loss of $7.03 million for the year ended Dec. 31,
2020, and a net loss of $4.79 million for the year ended Dec. 31,
2019. As of March 31, 2022, the Company had $18.88 million in
total assets, $4.43 million in total liabilities, and $14.45
million in total stockholders' equity.
SK HOLDCO: S&P Cuts ICR to 'SD' on Completed Distressed Exchange
----------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on SK HoldCo
LLC (Service King) to 'SD' (selective default) from 'CC'. S&P
lowered the issue-level ratings on the senior secured debt to 'D'
from 'CC' and senior unsecured debt tranches to 'D' from 'C'.
Service King completed its distressed exchange transaction
announced in May 2022 with a consortium of senior secured and
unsecured creditors.
The downgrade to 'SD' reflects Service King having completed its
distressed exchange with creditors, reducing the company's debt
burden by $500 million. The transaction converted the notes into
virtually all of the equity in the new parent holding entity, which
S&P expects to be named New SK Holdco. In connection with the
financial restructuring, Service King received a total of $160
million in new equity capital along with creditors releasing the
$75 million in restricted cash held on its balance sheet. The cash
can be used for general corporate purposes and enhances near-term
liquidity needs.
ESG credit indicators: E-2, S-2, G-3
S&P said, "Environmental credit factors have an overall neutral
influence on our rating analysis on SK Holdco. The company is
focused on collision repair, the demand and cost for which will
face no significant impact from increased electrification of auto
powertrains. While the company must manage its use of paint and
disposal of old parts, the cost of oversight is reasonable.
Governance is a moderately negative consideration. Our assessment
of the company's financial risk profile as highly leveraged
reflects corporate decision-making that prioritizes the interests
of controlling owners, in line with our view of most rated entities
owned by private-equity sponsors. Our assessment also reflects
their generally finite holding periods and a focus on maximizing
shareholder returns."
STORCENTRIC INC: Continued Cash Access, $750,000 DIP Loan OK'd
--------------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of California,
San Jose Division, entered a second interim order authorizing
StorCentric, Inc. and its debtor-affiliates to, among other things,
obtain postpetition financing and continue using cash collateral on
an interim basis.
At the hearing on July 12, the Debtors sought Court approval to
obtain an additional $750,000 of interim funding from Serene
Investment Management, LLC under the terms and conditions of the
Interim Order, the Second Interim DIP Order and the Order.
The Court said any DIP Loan extended under the terms of the Order
will be deemed to have been extended in good faith by the DIP
Lender, as that term is used in section 364(e) of the Bankruptcy
Code, and will be secured by first priority security interests in
and liens upon all of the DIP Collateral pursuant to sections
364(c) and 364(d) of the Bankruptcy Code.
Except as modified by the Third Interim Order, the Interim Order,
the Amended Interim DIP Order and the Second Interim DIP Order
remain in full force and effect.
The Court's authorization to use cash collateral under the Amended
Interim DIP Order is extended through and including the Final
Hearing, for uses and in the amounts set forth in the Approved
Budget.
The final hearing is scheduled for July 21, 2022 at 10 a.m.
A copy of the order is available at https://bit.ly/3RyCzwB from
PacerMonitor.com.
About StorCentric, Inc.
StorCentric, Inc. develops software and security systems to
mitigate cybersecurity threats to ensure data is not compromised.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Cal. Case No. 22-50515) on June 20,
2022. In the petition filed by John Coughlan, CFO, the Debtor
disclosed up to $50 million in both assets and liabilities.
Judge Elaine Hammond oversees the case.
John W. Mills, III, Esq., at Jones Walker LLP is the Debtor's
counsel.
SUMMIT LLC: Case Summary & Two Unsecured Creditors
--------------------------------------------------
Debtor: Summit, LLC
445 S. Beverly Dr., Ste. 100
Beverly Hills, CA 90212
Chapter 11 Petition Date: July 15, 2022
Court: United States Bankruptcy Court
Central District of California
Case No.: 22-13853
Judge: Hon. Vincent P. Zurzolo
Debtor's Counsel: David B. Golubchik, Esq.
LEVENE, NEALE, BENDER, YOO & GOLUBCHICK LLP
2818 La Cienega Avenue
Los Angeles, CA 90034
Tel: (310) 229-1234
Email: dbg@lnbyg.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Moussa Kashani as managing member.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/6NGUDSI/Summit_LLC__cacbke-22-13853__0001.0.pdf?mcid=tGE4TAMA
THREE ARROWS: Founders' Whereabouts Unknown, Says Court Filing
--------------------------------------------------------------
Rahul Nambiampurath of Be In Crypto reports a court filing shows
that the current locations of 3AC founders Kyle Davies and Su Zhu
are unknown. The development adds to the already tense situation
of the company.
Reports are emerging that the founders of now-bankrupt Three Arrows
Capital fled Singapore after the company filed for bankruptcy. 3AC
was headquartered in the country, and according to a filing, the
current location of founders Kyle Davies and Su Zhu is unknown. The
filing was made in a court in New York.
Where in the world are Davies and Zhu?
3AC was facing pressure from multiple creditors, and the
company’s financial strain at this point is well documented. It
filed for liquidation in the British Virgin Islands. The fact that
the current locations of the founders are unknown adds temperature
to a case already at its boiling point.
The creditors' lawyers have also said that the Singapore office of
3AC has been vacated. They also said the two founders have not
been cooperating with the investigation and even turned off audio
and video in a Zoom call.
At one point, 3AC managed over $3 billion in assets -— a sum that
has fallen phenomenally since the market crash. There have also
been rumors that Zhu has sold his mansion in Singapore, at a
reported value of $35 million. The funds are believed to have been
sent to Dubai.
The lack of cooperation could make this case worse for 3AC.
Creditors are desperate for some reparation, but the lack of
cooperation does not bode well. As such, they are looking to
freeze 3AC's assets, which appear to be moving out -- a development
that would rightfully aggrieve investors.
3AC fall stokes fears and anger
The creditors seeking a quick solution to the incident include
Deribit and Blockchain.com. The Monetary Authority of Singapore
heavily criticized the company and said that it used misleading
information.
Meanwhile, Voyager Digital has also suffered from 3AC's fall. It
has filed for chapter 11 bankruptcy and seen its shares slump
sharply. The most worrying aspect of this development is that
customers of the platform may not get all their crypto back.
Other platforms and companies will be on their toes as the fallout
from the 3AC downfall does not appear to be over. Many will see it
as a learning lesson and takes precaution when working in the
market in the future.
About Three Arrows Capital
Three Arrows Capital Ltd. was an investment firm engaged in
short-term opportunities trading, and is heavily invested in
cryptocurrency, funded through borrowings.
As of April 2022, the Debtor was reported to have over $3 billion
of assets under its management.
Three Arrows Capital Ltd. was incorporated as a business company
under the laws of the British Virgin Islands. Its sole shareholder
owning all of its "management shares" is Three Arrows Capital Pte.
Ltd., which previously operated as a regulated fund manager in
Singapore until 2021, when it shifted its domicile to the BVI, as
part of a global corporate plan to relocate operations to Dubai.
The Debtor borrowed digital and fiat currency from multiple lenders
to fund its cryptocurrency investments. After cryptocurrency lost
99% of its value, and then prices of other cryptocurrencies had
rapid declines, the Debtor reportedly defaulted on its
obligations.
On June 24, 2022, one of the Debtor's many creditors -- DRB Panama
Inc. -- filed an application to appoint joint provisional
liquidators -- and thereafter, full Liquidators -- in the Eastern
Caribbean Supreme Court in the High Court of Justice (Commercial
Division) located in BVI. The application was assigned claim number
BVIHCOM2022/0117.
Subsequently, on June 27, 2022, the Debtor filed its own
application for the appointment of joint liquidators before the BVI
Commercial Court.
On June 29, 2022, the Honorable Mr. Justice Jack of the BVI
Commercial Court appointed Russell Crumpler and Christopher Farmer
of Teneo (BVI) Limited as joint liquidators of Three Arrows Capital
Ltd.
On July 1, 2022, liquidators of Three Arrows Capital filed a
Chapter 15 bankruptcy in the U.S. (Bankr. S.D.N.Y. Case No.
22-10920) to seek recognition of the BVI proceedings. Judge Martin
Glenn is the case judge. Latham & Watkins, led by Adam J. Goldberg
is counsel in the U.S. case.
The law firm of Ogier, led by Grant Carroll, is advising the
liquidators in the BVI proceedings.
TORINO CAMPUS: Case Summary & One Unsecured Creditor
----------------------------------------------------
Debtor: Torino Campus, LLC
1497 SW Martin Downs Blvd
Palm City, FL 34990
Business Description: Torino Campus is a Single Asset Real Estate
(as defined in 11 U.S.C. Section 101(51B)).
Chapter 11 Petition Date: July 15, 2022
Court: United States Bankruptcy Court
Southern District of Florida
Case No.: 22-15442
Judge: Hon. Mindy A. Mora
Debtor's Counsel: Brian K. McMahon, Esq.
BRIAN K. MCMAHON, PA, ON BEHALF OF
FLORIDA RURAL LEGAL SERVICES
1401 Forum Way
6th Floor
West Palm Beach, FL 33401
Tel: 561-478-2500
Email: briankmcmahon@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Jose Toledo as managing member.
The Debtor listed Huntington as its single unsecured creditor
holding a claim of $3,637.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/UYQZYWI/Torino_Campus_LLC__flsbke-22-15442__0001.0.pdf?mcid=tGE4TAMA
TPC GROUP: Creditors Fight $238 Mil. Bankruptcy Loan Roll-Up
------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that chemical manufacturer TPC
Group Inc. is facing challenges from investor Cerberus Capital
Management L.P. and unsecured creditors over a proposal to fund its
Chapter 11 case through a loan that would benefit holders of $238
million worth of pre-bankruptcy debt.
TPC is seeking final approval of a $323 million term loan facility
that provides just $85 million worth of new money to fund the
Houston-based firm's bankruptcy proceedings. The rest of the
amount comprises a February 2021 note issuance to be rolled up into
the loan, elevating the priority of debts owed to a select group of
noteholders.
About TPC Group
TPC Group, headquartered in Houston, is a producer of value-added
products derived from petrochemical raw materials such as C4
hydrocarbons, and provider of critical infrastructure and logistics
services along the Gulf Coast. The Company sells its products into
a wide range of performance, specialty and intermediate markets,
including synthetic rubber, fuels, lubricant additives, plastics
and surfactants. With an operating history of more than 75 years,
TPC Group has a manufacturing facility in the industrial corridor
adjacent to the Houston Ship Channel and operates product terminals
in Port Neches, Texas and Lake Charles, Louisiana.
TPC Group Inc. and its subsidiaries sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 22-10493) on June 1, 2022. TPC Group
estimated assets and debt of $1 billion to $10 billion to $10
billion.
The Hon. Craig T. Goldblatt is the case judge.
Baker Botts L.L.P. is the Debtors' counsel; Morris, Nichols, Arsht
& Tunnell LLP is the co-counsel; Moelis & Company LLC is the
investment banker; and FTI Consulting is the financial advisor.
Simpson Thacher & Bartlett LLP is the special finance counsel.
Kroll Restructuring Administration is the claims agent.
Eclipse Business Capital LLC is advised by Goldberg Kohn Ltd.
Paul Hastings LLP, and Stroock & Stroock & Lavan LLP are serving as
counsel to the Ad Hoc Noteholder Group that supports the Debtors'
restructuring. Evercore Group L.L.C., is the Group's financial
advisor. Young Conaway Stargatt & Taylor, LLP is local counsel to
the Ad Hoc Noteholder Group. The Supporting Noteholders are funds
controlled by FIG LLC and Fortress Capital Finance III(A)LLC,
Monarch Alternative Capital LP., PGIM Inc., Redwood Capital
Management LLC, and Strategic Value Partners LLC.
Milbank LLP, and Pachulski, Stang, Ziehl & Jones are serving as
counsel to an Ad Hoc Group of Non-Consenting Noteholders, led by
Bayside Capital, Inc., and Cerberus Capital Management, L.P.
TRX HOLDCO: Wins Cash Collateral Access Thru July 24
----------------------------------------------------
The U.S. Bankruptcy Court for the Central District of California,
Santa Ana Division, authorized TRX Holdco, LLC and Fitness Anywhere
LLC, dba TRX and TRX Training, to use cash collateral on an interim
basis in accordance with the budget, with a 15% variance.
The Debtors are permitted to use cash collateral to (a) pay
quarterly fees to the United States Trustee and any required Court
costs; (b) pay, in the ordinary course of business, the expenses
set forth in the Debtors' Third Updated Budgets and (c) pay up to
$355,000 for the purchase of new inventory.
The Woodforest National Bank is granted, on account of the Bank's
interest in the Debtors' cash collateral, on account of the
Debtors' post-petition use of cash collateral, adequate protection
in the form of (a) a replacement lien against the Debtors'
post-petition assets (excluding any avoidance causes of action), to
the extent of any post-petition diminution in the value of the
Bank's collateral as a result of the Debtors' post-petition use of
cash collateral; and (b) a superpriority administrative claim
pursuant to Section 507(b) of the Bankruptcy Code to the extent of
any post-petition diminution in the value of the Bank's prepetition
collateral as a result of the Debtors' post-petition use of cash
collateral. All replacement liens granted are valid, enforceable
and fully perfected, and no filing or recordation or any other act
in accordance with any applicable local, state, or federal law is
necessary.
A fifth interim hearing on the matter is scheduled for July 27 at
1:30 p.m.
A copy of the order is available at https://bit.ly/3ayT5fK from
PacerMonitor.com.
About TRX Holdco, LLC
TRX Holdco, LLC and Fitness Anywhere LLC, dba TRX and TRX Training,
provide sporting and athletic goods. They sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Cal. Lead Case
No. 22-10948) on June 8, 2022. In the petition signed by Brent
Leffel, chairman of the Board of Managers of TRX Holdco, LLC, the
Debtor disclosed up to $50 million in both assets and liabilities.
Judge Scott C. Clarkson oversees the case.
Ron Bender, Esq., at Levene, Neale, Bender, Yoo and Golubchick LLP,
is the Debtor's counsel.
VIVAKOR INC: Marcum LLP Replaces Macias Gini as Auditor
-------------------------------------------------------
The Audit Committee of the Board of Directors of Vivakor, Inc.
performed a competitive review process to evaluate and select a
firm as the Company's independent registered public accounting firm
for the fiscal year ending Dec. 31, 2022. On July 1, 2022, the
Audit Committee approved the dismissal of Macias Gini & O'Connell,
LLP as the Company's independent registered public accounting firm
and also approved the appointment of Marcum LLP as the Company's
new independent registered public accounting firm for the fiscal
year ending Dec. 31, 2022. Marcum was formally engaged July 5,
2022.
MGO's reports on the Company's financial statements for the fiscal
years ended Dec. 31, 2021 and Dec. 31, 2020 contained no adverse
opinions or disclaimers of opinions and were not qualified or
modified as to uncertainty, audit scope, or accounting principles.
During the fiscal years ended Dec. 31, 2021 and Dec. 31, 2020, and
the subsequent period through July 5, 2022, there were (i) no
"disagreements" (as that term is defined in Item 304(a)(1)(iv) of
Regulation S-K and the related instructions) between the Company
and MGO on any matter of accounting principles or practices,
financial statement disclosure or auditing scope or procedure,
which disagreements, if not resolved to the satisfaction of MGO,
would have caused MGO to make reference to the subject matter of
the disagreement in MGO's reports on the Company's consolidated
financial statements for such years, and (ii) no "reportable
events" (as that term is defined in Item 304(a)(1)(v) of Regulation
S-K).
During the fiscal years ended Dec. 31, 2021 and Dec. 31, 2020, and
the interim period through June 30, 2022, the Company did not
consult with Marcum regarding: (i) the application of accounting
principles to a specified transaction, either proposed or
completed, or the type of audit opinion that might be rendered on
the Company's financial statements, and neither a written report
nor oral advice was provided to the Company that Marcum concluded
was an important factor considered by the Company in reaching a
decision as to the accounting, auditing or financial reporting
issue; or (ii) any matter that was either the subject of a
"disagreement" (as that term is defined in Item 304(a)(1)(iv) of
Regulation S-K and the related instructions) or a "reportable
event" (as that term is defined in Item 304(a)(1)(v) of Regulation
S-K).
About Vivakor Inc.
Coralville, Iowa-based Vivakor, Inc., is a clean energy technology
company focused in the area of oil remediation and natural
resources. The company currently focuses on its patented
Remediation Processing Centers that allows for the environmentally
friendly recovery of bitumen (heavy crude) and other hydrocarbons
from the remediation of contaminated soils. It is believed to be
the only remediation system that can clean soils with more than 5%
by weight oil contamination while fully recovering the oil and
leaving the soil fully viable for reuse.
Vivakor reported a net loss attributable to the company of $5.48
million for the year ended Dec. 31, 2021, compared to a net loss
attributable to the company of $2.18 million for the year ended
Dec. 31, 2020. As of March 31, 2022, the Company had $54.82
million in total assets, $18.28 million in total liabilities, and
$36.54 million in total stockholders' equity.
VOYAGER DIGITAL: Can't Guarantee All Customers to Receive Crypto
----------------------------------------------------------------
Turner Wright of Cointelegraph reports that the crypto lending
firm, Voyager Digital, said that the exact amount reimbursed to
users will "depend on what happens in the restructuring process and
the recovery of 3AC assets."
Following Voyager Digital filing for bankruptcy on Tuesday, July 5,
2022, the crypto lending firm said its recovery plan was aimed at
preserving customer assets but did not explicitly state it would be
able to return all equivalent funds to affected users.
In a Monday blog, Voyager said it had roughly $1.3 billion in
affected users' funds in addition to $650 million of "claims
against Three Arrows Capital" — referring to the 15,250 Bitcoin
(BTC) and 350 million USD Coin (USDC) loan the firm failed to
repay. According to Voyager's proposed recovery plan — subject
to approval from the courts — users may receive a combination of
Voyager tokens, cryptocurrencies, "common shares in the newly
reorganized company," and funds from any proceedings with Three
Arrows Capital, or 3AC.
"The exact numbers will depend on what happens in the restructuring
process and the recovery of 3AC assets," said the lending firm.
“The plan is subject to change, negotiation with customers, and
ultimately a vote [...] We put together a restructuring plan that
would preserve customer assets and provide the best opportunity to
maximize value."
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.
WALKER SERVICE: Trustee's Joint Plan Confirmed by Judge
-------------------------------------------------------
Judge Elizabeth S. Stong has entered an order confirming the Joint
Plan of Reorganization filed by Salvatore LaMonica, solely in his
capacity as the Chapter 11 Trustee of the jointly administered
estates of Walker Service Corp., et al. ("Corporate Debtors") and
Sophie and Joe Pross (the "Individual Debtors", and collectively
with the Corporate Debtors, the "Reorganized Debtors"), for the
Debtors.
The Plan is feasible, and confirmation of the Plan is not likely to
be followed by the liquidation, or the need for further financial
reorganization of the Reorganized Debtors under the Plan, except to
the extent that such liquidation or reorganization is proposed in
the Plan.
One class of claims, Class 2 — PenFed Claim, is impaired under
the Plan, and based upon the solicitation of votes, as evidenced by
the Certification of Ballots filed in each of the Reorganized
Debtors' cases, such class voted in favor of the Plan.
The Plan has been proposed in good faith and not by any means
forbidden by law, and the Plan will fairly achieve a result
consistent with the objectives and purposes of the Bankruptcy
Code.
The Trustee is authorized to distribute all funds and payments in
accordance with the Plan and this Order. The Plan, and other
transactions contemplated thereby, constitute the exercise of
reasonable business judgment by the Trustee.
A full-text copy of the Plan Confirmation Order dated July 12,
2022, is available at https://bit.ly/3zb2005 from PacerMonitor.com
at no charge.
Counsel for the Chapter 11 Trustee:
LaMonica Herbst & Maniscalco, LLP
Adam P. Wofse, Esq.
Jacqulyn S. Loftin, Esq
3305 Jerusalem Avenue
Wantagh, New York 11793
Tel: (516) 826-6500
Fax: (516) 826-0222
Email: awofse@lhmlawfirm.com
jsl@lhmlawfirm.com
Counsel for Corporate Debtors:
Robert J. Spence, Esq.
Spence Law Office, P.C.
55 Lumber Road, Suite 5
Roslyn, NY 11576
Telephone: (516) 336-2060
Facsimile: (516) 605-2084
Email: rspence@spencelawpc.com
Counsel for the Individual Debtors:
WESTERMAN BALL EDERER MILLER ZUCKER & SHARFSTEIN, LLP
Thomas A. Draghi, Esq
1201 RXR Plaza
Uniondale, New York 11556
Tel.: 516 622 9200 Ext.: 403
Fax: 516 622 9212
Email: tdraghi@westermanllp.com
About Walker Service
Walker Service Corp. and its debtor-affiliates are privately held
companies in the taxi and limousine service industry.
On March 27, 2020, Walker Service Corp. and 21 affiliates
concurrently filed voluntary petitions for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D.N.Y. Lead Case No. 20-41759). At
the time of the filing, Walker Service estimated assets of $100,000
to $500,000 and estimated liabilities of $1 million to $10
million. Judge Elizabeth S. Stong oversees the cases.
The Debtors tapped Griffin Hamersky LLP and Spence Law Office, P.C.
as legal counsel.
WDT ACQUISITION: S&P Affirms 'B-' ICR, Outlook Stable
-----------------------------------------------------
S&P Global Ratings affirmed its 'B-' issuer credit rating on WDT
Acquisition Corp. (doing business as Solis Mammography). S&P also
affirmed its 'B-' issue-level rating on the company's first-lien
credit facilities. The '3' recovery rating is unchanged.
The stable outlook reflects S&P's expectation for operating cash
flow to improve over the next few years supported by
mid-single-digit organic revenue growth and increased contributions
from joint venture (JV) partnerships.
S&P said, "We affirmed the rating and kept the outlook stable
despite weaker-than-anticipated cash flow generation because we
expect the company to grow and for cash flow from operations to
cover maintenance capex and mandatory amortization by 2023. Higher
operating expenses and development spending contributed to weaker
cash flow than we initially projected. However, first quarter
performance is in line with the company's projections, and
underlying organic growth is healthy. While we expect the company's
growth spending to consume cash and require external financing, we
expect that these investments will translate to EBITDA growth that
will outpace cash interest growth. Removing growth and development
capex, we still project cash flow deficits after amortization
payments and maintenance capex in 2022, but expect cash flow from
operations will cover maintenance capex and mandatory amortization
in 2023.
"We expect stable industry dynamics and Solis' patient focus will
enable long-term top-line growth.Solis is singularly focused on
mammography and women's health in the highly fragmented and
competitive women's health care industry. Mammography is a
slow-growing, mature, but stable industry. The number of women
receiving mammograms has held steady over the past several years,
with approximately 55% of women over the age of 40 receiving a
mammogram each year. Solis' strategy focuses on increasing patient
satisfaction and compliance through significant outreach;
convenient, patient-friendly facilities using 3D mammography
equipment; and using only breast-dedicated radiologists. Through
these efforts, the company has successfully increased its patient
compliance rate to over 70% of its patients receiving a mammogram
screening within 12-18 months. We believe these efforts are key
components to driving a recurring revenue stream and organic
revenue growth."
Solis has seen a strong rebound in patient visit volumes above
pre-pandemic levels. Solis reported a strong rebound in patient
visit volumes at its consolidated and unconsolidated centers for
first-quarter 2022 and is tracking ahead of budget. S&P said, "We
expect volume growth to continue throughout 2022, supporting
mid-single-digit revenue growth as reimbursement remains flat. We
also expect volume growth and Solis' cash flow generation to
benefit from its recent acquisition of Memorial Health, which
closed in late 2021. In addition to contributions from the Memorial
Health acquisition, we expect maturing de novos to further support
volume growth throughout 2022."
Solis' plans to build out its network would likely increase EBITDA,
but require external funding. The company's growth strategy
involves expanding existing practices, entering into 50/50 JV
partnerships with health systems, and investing in de novos. If
Solis pursues its current growth plans, we expect it to produce
reported discretionary cash flow deficits of about $38 million in
2022, burdened by about $35 million in development spending. S&P
expects that the company's liquidity will be adequate to cover
maintenance capex and mandatory term loan amortization payments
over the next 12 months but believe it will need to rely on
external funding to finance its current growth plan.
S&P said, "In addition, we expect the company will remain
acquisitive and will likely issue incremental debt to fund the $24
million note payable assumed with Radiology Partners Inc., in
connection with the formation of RP-Solis LLC JV, which matures
February 2023. The note is secured by Solis' 20% ownership share in
the JV and therefore forfeiting the repayment would result in loss
of its ownership stake in the JV and would not trigger a default.
If the company is unable to secure external debt to fund the
retirement of the note, we believe it would likely draw on its
revolving credit facility or available cash to fund the payment,
reducing its liquidity. However, we expect the repayment of the
note to be accretive to cash flow beginning in 2023.
"The company's growth strategy should increase EBITDA faster than
cash interest, but rising rates and continued operational execution
are key risks. Since rates are rising and since Solis will need to
obtain external financing to fund its growth, we expect cash
interest expenses to rise. Solis' capital structure is composed
primarily of floating-rate debt, which exposes Solis to interest
rate risk. Although the company has hedges in place to partially
mitigate rising interest rates, we expect interest expense will
rise considerably over the next two years. We expect cash flow
growth generated from maturing and new partnerships will more than
outpace higher interest costs, but this will require the company to
continue to ramp up and increase patient visits and cash flow at
its new and existing facilities, as well as successfully integrate
acquisitions.
"We expect leverage to remain elevated at about 10x in 2022 and 9x
in 2023. Although we view the company's growth strategy of
partnering with health systems favorably, we believe rapid growth
via acquisitions and de novos has significant inherent risks that
could increase its cost structure since de novos tend to generate
operating losses for 12-18 months after start-up. We expect the
company's growth strategy will also keep leverage high. We
therefore expect adjusted debt to EBITDA to remain elevated at
about 10x in 2022 and above 9x in 2023.
"Our stable outlook reflects our expectation for operating cash
flow to improve over the next few years, supported by
mid-single-digit organic revenue growth and increased contributions
from JV partnerships.
"We could lower our rating if reported cash flow from operations
did not grow as we anticipated or if liquidity deteriorated. This
could occur if distributions from JVs were lower than anticipated,
capital costs to fund cash flow deficits were greater than we
projected, or if the company did not secure additional capital."
Although unlikely over the next year, S&P could raise its rating
if:
- The company's growth accelerated well above our forecast,
resulting in sustained free operating cash flow (after development
spending) to debt of over 3.5% and adjusted leverage sustained
below 5x; or
-- The company diversified its operations and significantly
increased its scale.
ESG credit indicators: E-2, S-2, G-3
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis. Our assessment of the
company's financial risk profile as highly leveraged reflects
corporate decision-making that prioritizes the interests of the
controlling owners, in line with our view of most rated entities
owned by private equity sponsors. Our assessment also reflects the
generally finite holding periods and a focus on maximizing
shareholder returns."
YOUNGEVITY INTERNATIONAL: Unit Secures $4M Secured Loan From GemCap
-------------------------------------------------------------------
CLR Roasters, LLC, a wholly owned subsidiary of Youngevity
International, Inc., entered into a loan and security agreement
with GemCap Solutions, LLC pursuant to which CLR issued to GemCap a
secured revolving loan promissory note in the principal sum of up
to $4,000,000.
The Loan and Security Agreement provides for a line of credit in an
amount equal to the lesser of (a) $4,000,000 or (b) the Borrowing
Base, which is defined as the sum of (A) the product obtained by
multiplying the outstanding amount of all eligible accounts
receivable, net of all taxes, discounts, allowances and credits
given or claimed, by up to 80%, plus (B) the lesser of (i) the
product obtained by multiplying the cost of then-existing eligible
inventory by 70% and (i) the sum of (x) which is the product
obtained by multiplying the lower of cost or market price of
then-existing eligible green coffee inventory by 60% and (y) the
product obtained by multiplying the lower of cost or market price
of then-existing eligible roasted inventory by 70%.
The outstanding principal balance of the line of credit bears
interest based upon a 360-day year with interest charged for each
day the principal amount is outstanding including the date of
actual payment. The interest rate is a rate equal to the greater
of (a) 7.50% or (b) the sum of the prime rate plus 3.50%. At
closing, the GemCap line of credit was used to pay off CLR's line
of credit balance with Crestmark Bank of approximately $1,717,000.
As collateral security for the payment and performance of the
obligations, CLR granted and conveyed to GemCap a first priority
continuing security interest in and lien upon all owned and
hereafter acquired or created property and assets of CLR and the
proceeds and products thereof, which property, assets and proceeds,
together with all other collateral security for the obligations
granted to or otherwise acquired by GemCap, is considered
collateral, such as, accounts receivables, inventory, deposit
accounts, property and equipment and intangible assets.
The Loan and Security Agreement contains certain financial and
nonfinancial covenants with which the Company must comply to
maintain its borrowing availability and avoid penalties, such as a
prohibition on additional indebtedness and other liens. The Note
matures in June 2024. In addition, pursuant to a Secured
Continuing Guarantee, dated July 6, 2022, the Company's chief
executive officer and chief operating officer personally guaranteed
CLR's obligations to GemCap under the Loan and Security Agreement.
The Loan and Security Agreement contains customary representations,
warranties, conditions and indemnification obligations of the
parties. The representations, warranties and covenants contained
in the Loan and Security Agreement were made only for purposes of
such agreement and as of a specific date, were solely for the
benefit of the parties to such agreements and may be subject to
limitations agreed upon by the contracting parties.
About Youngevity
Chula Vista, California-based Youngevity International, Inc. --
https://ygyi.com -- is a multi-channel lifestyle company operating
in three distinct business segments including a commercial coffee
enterprise, a commercial hemp enterprise, and a direct marketing
enterprise. The Company features a multi country selling network
and has assembled a virtual Main Street of products and services
under one corporate entity. The Company offers products from the
six top selling retail categories: health/nutrition, home/family,
food/beverage (including coffee), spa/beauty, apparel/jewelry, as
well as innovative services.
Youngevity reported a net loss attributable to common stockholders
of $52.67 million for the year ended Dec. 31, 2019, compared to a
net loss attributable to common stockholders of $23.50 million for
the year ended Dec. 31, 2018. As of June 30, 2020, the Company had
$86.89 million in total assets, $64.62 million in total
liabilities, and $22.27 million in total stockholders' equity.
Houston, Texas-based MaloneBailey, LLP, the Company's auditor since
2020, issued a "going concern" qualification in its report dated
June 24, 2021, citing that the Company has suffered recurring
losses from operations and has a net capital deficiency that raise
substantial doubt about its ability to continue as a going concern.
[^] BOND PRICING: For the Week from July 11 to 15, 2022
-------------------------------------------------------
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------- ------ ------ --------- --------
Accelerate Diagnostics AXDX 2.500 66.100 3/15/2023
Ahern Rentals Inc AHEREN 7.375 76.727 5/15/2023
Ahern Rentals Inc AHEREN 7.375 77.098 5/15/2023
BPZ Resources Inc BPZR 6.500 3.017 03/01/2049
Basic Energy Services Inc BASX 10.750 13.000 10/15/2023
Basic Energy Services Inc BASX 10.750 15.000 10/15/2023
Bed Bath & Beyond Inc BBBY 3.749 39.630 08/01/2024
Buckeye Partners LP BPL 6.375 79.325 1/22/2078
Buffalo Thunder
Development Authority BUFLO 11.000 50.000 12/09/2022
Colgate-Palmolive Co CL 1.205 94.467 8/22/2042
DCP Midstream LP DCP 7.375 88.500 N/A
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 22.518 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 6.625 9.257 8/15/2027
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 27.000 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 22.598 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 6.625 9.397 8/15/2027
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 22.211 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 32.000 8/15/2026
Diebold Nixdorf Inc DBD 8.500 46.582 4/15/2024
EnLink Midstream
Partners LP ENLK 6.000 65.000 N/A
Energy Conversion
Devices Inc ENER 3.000 7.875 6/15/2013
Energy Transfer LP ET 6.250 78.000 N/A
Enterprise Products
Operating LLC EPD 4.875 79.330 8/16/2077
Envision Healthcare Corp EVHC 8.750 29.044 10/15/2026
Envision Healthcare Corp EVHC 8.750 29.529 10/15/2026
Exela Intermediate LLC /
Exela Finance Inc EXLINT 11.500 28.116 7/15/2026
Exela Intermediate LLC /
Exela Finance Inc EXLINT 10.000 64.714 7/15/2023
Exela Intermediate LLC /
Exela Finance Inc EXLINT 11.500 28.764 7/15/2026
Exela Intermediate LLC /
Exela Finance Inc EXLINT 10.000 64.714 7/15/2023
Florida Power & Light Co NEE 1.280 91.110 03/01/2071
GNC Holdings Inc GNC 1.500 0.840 8/15/2020
GTT Communications Inc GTTN 7.875 8.250 12/31/2024
GTT Communications Inc GTTN 7.875 7.000 12/31/2024
General Electric Co GE 4.200 71.375 N/A
Goldman Sachs Group GS 5.000 87.250 N/A
JPMorgan Chase & Co JPM 4.625 86.996 N/A
Lannett Co Inc LCI 4.500 29.200 10/01/2026
MAI Holdings Inc MAIHLD 9.500 30.000 06/01/2023
MAI Holdings Inc MAIHLD 9.500 30.000 06/01/2023
MAI Holdings Inc MAIHLD 9.500 30.000 06/01/2023
MBIA Insurance Corp MBI 13.772 11.279 1/15/2033
MBIA Insurance Corp MBI 13.772 11.279 1/15/2033
Macy's Retail Holdings M 6.700 95.795 7/15/2034
Macy's Retail Holdings M 6.700 95.795 7/15/2034
Morgan Stanley MS 1.800 77.057 8/27/2036
National Commerce Corp CSFL 6.500 91.815 6/30/2027
Nine Energy Service Inc NINE 8.750 62.467 11/01/2023
Nine Energy Service Inc NINE 8.750 63.407 11/01/2023
Nine Energy Service Inc NINE 8.750 63.454 11/01/2023
OMX Timber Finance
Investments II LLC OMX 5.540 0.783 1/29/2020
Patriot National
Bancorp Inc PNBK 6.250 73.174 6/30/2028
Patriot National
Bancorp Inc PNBK 6.250 73.174 6/30/2028
Plains All American
Pipeline LP PAA 6.125 73.375 N/A
Renco Metals Inc RENCO 11.500 24.875 07/01/2003
Revlon Consumer
Products Corp REV 6.250 8.125 08/01/2024
Rolta LLC RLTAIN 10.750 1.150 5/16/2018
RumbleON Inc RMBL 6.750 46.174 01/01/2025
Santander Holdings USA SANUSA 2.236 99.673 7/21/2023
Sears Holdings Corp SHLD 6.625 3.835 10/15/2018
Sears Holdings Corp SHLD 8.000 0.807 12/15/2019
Sears Holdings Corp SHLD 6.625 3.835 10/15/2018
Sears Roebuck Acceptance SHLD 7.000 1.071 06/01/2032
Sears Roebuck Acceptance SHLD 7.500 1.065 10/15/2027
Sears Roebuck Acceptance SHLD 6.750 0.548 1/15/2028
Sears Roebuck Acceptance SHLD 6.500 1.033 12/01/2028
TPC Group Inc TPCG 10.500 54.250 08/01/2024
TPC Group Inc TPCG 10.500 53.911 08/01/2024
TerraVia Holdings Inc TVIA 5.000 4.644 10/01/2019
US Renal Care Inc USRENA 10.625 39.364 7/15/2027
US Renal Care Inc USRENA 10.625 38.971 7/15/2027
Wayfair Inc W 0.375 90.016 09/01/2022
Wells Fargo & Co WFC 1.884 99.295 7/25/2022
Wesco Aircraft Holdings WAIR 8.500 50.403 11/15/2024
Wesco Aircraft Holdings WAIR 13.125 31.205 11/15/2027
Wesco Aircraft Holdings WAIR 8.500 50.652 11/15/2024
fuboTV Inc FUBO 3.250 32.250 2/15/2026
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Philadelphia, Pa., USA.
Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante,
Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon,
Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and
Peter A. Chapman, Editors.
Copyright 2022. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
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 ***