/raid1/www/Hosts/bankrupt/TCR_Public/220930.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Friday, September 30, 2022, Vol. 26, No. 272
Headlines
1325 ATLANTIC: Seeks More Time to File Bankruptcy Plan
212 EAST 72ND: Says Plan Proponent Acting as Buyer and Seller
7614 LLC: Files for Chapter 11 Bankruptcy Protection
ACTIVA RESOURCES: Cargill Wants Disclosures on Exit Financing
ACTIVA RESOURCES: Secured Lenders Get All The Risk, Says TCB
ALL FLORIDA SAFETY: Hits Chapter 11 Bankruptcy
ALLIANCE HOSPITALITY: Files Emergency Bid to Use Cash Collateral
ALLSPRING BUYER: Fitch Cuts LongTerm IDR to 'BB-', Outlook Negative
ARCHBISHOP OF AGANA: Unsecured Creditors Unimpaired in Plan
BINGHAMTON PLAZA: Mayor Touts Case Dismissal, Eyes Property
BOY SCOUTS: Insurers File Appeals Opposing Plan Approval
CALUMET PAINT: Gets Cash Collateral Access Thru Nov 30
CELSIUS NETWORK: Creditors Committee Members Disclose Claims
CELSIUS NETWORK: Might Consider Turning Debt to Crypto 'IOU' Tokens
CELSIUS NETWORK: Washington State Joins Bankruptcy Case
CENTRAL FLORIDA CIVIL: Wins Interim Cash Collateral Access
CIV LLC: Wins Final Cash Collateral Access
COINBASE GLOBAL: Moody's Confirms Ba3 CFR & Alters Outlook to Neg.
COMMUNITY ECO POWER: Seeks to Hire RSM US as Accountant
CPE FEEDS: Bid to Use Cash Collateral Denied as Moot
CROSSLINKS FAMILY: Files Emergency Bid to Use Cash Collateral
DANNY R. BARTEL: Unsecureds Will Get 50% of Claims in 60 Months
DOT DOT SMILE: Seeks to Tap Jeffrey S. Shinbrot as Legal Counsel
EASTERDAY RANCHES: DOJ Suggests 10-Year Sentence for Cody Easterday
EL RANCHO COLORADO: Files for Chapter 11 Bankruptcy
ENDO INT'L: Cooley, Akin Gump Represent Opioid Claimants
EVERGREEN SITE: Commences Subchapter V Case
EXWORKS CAPITAL: Exclusivity Period Extended to Oct. 10
FOX SUBACUTE: Wins Cash Collateral Access Thru Dec 17
FREE SPEECH: Alex Jones Renews "Deep State" Claim in Trial
GIRARDI & KEESE: Erika Earrings Auctioneer Approved
GPMI CO: Exclusivity Period Extended to Oct. 14
HARDIN TRUCKING: Seeks to Hire Lyle, Walker & Co as Accountant
INFOW LLC: Court Orders New Officials to Oversee Bankruptcy Case
JUMBA LLC: Files for Chapter 11 to Stop Foreclosure
KEEPITSIMPLE.US: Trustee Taps Christian & Denaburg as Accountant
KINSEY & KINSEY: Creditors Will be Paid in Full in 5 Years
LATAM AIRLINES: Goldman Sachs Kicks Off Loan for Chapter 11 Exit
LOADCRAFT INDUSTRIES: Files Amendment to Disclosure Statement
MCCLAIN INVESTMENTS: Case Summary & Four Unsecured Creditors
MOLECULAR IMAGING: Seeks Cash Collateral Access
NORTHSIDE VENTURES: Case Summary & 14 Unsecured Creditors
NRP VENTURES: Taps Everett Gaskins Hancock as Bankruptcy Counsel
NWJS INC.: Rings & Things Shuts Down After 50 Years
PBJAK LLC: Taps Deanne Walker of Trent Properties as Broker
PEAK THEORY: Seeks to Hire Parsons Behle & Latimer as Counsel
PHOENIX SERVICES: Pachulski, Gibson Advise on DIP/First Lien Group
PHOENIX SERVICES: S&P Downgrades ICR to 'D' on Chapter 11 Filing
PREHIRED ACCELERATOR: Voluntary Chapter 11 Case Summary
PREHIRED RECRUITING: Voluntary Chapter 11 Case Summary
PUERTO RICO: Mediators Ask 60-Day Deadline for PREPA Exit Plan
RICCI TRANSPORT: Intends to Sell 3 Trucks; Files Amended Plan
SAN DIEGO TACO: Gets Cash Collateral Access Thru Oct 1
SAS AB: Court Has 'Reservations' in Approving $700MM DIP Loan
SOTERA HEALTH: Moody's Affirms B1 CFR & Alters Outlook to Negative
SPARTAN POOLS: Taps Larson & Zirzow as Legal Counsel
SPARTAN POOLS: Wins Cash Collateral Access Thru Nov 1
STIMWAVE TECHNOLOGY: Director Urges Probe Before Sale to Kennedy
STREAM TV: Chancery Mulls Post-Appeal of Overturned Order
TPC GROUP: Exit Plan Vote Okayed Pending Liability Term Change
VASU CONVENIENCE: Exclusivity Period Extended to Dec. 28
VITEC ELECTRONICS: Seeks to Hire Curry Advisors as Legal Counsel
VOYAGER DIGITAL: Investor Objects to Bankruptcy Plan Disclosures
WALKING COMPANY: Sued By Simon Property Over $4.4 Million Judgment
WC BRAKER PORTFOLIO B: Case Summary & Two Unsecured Creditors
WILLIAM HOLDINGS: Taps Michael Jay Berger as Bankruptcy Counsel
WOODFORD EXPRESS: Moody's Withdraws B3 CFR on Term Loan Repayment
ZEKELMAN INDUSTRIES: S&P Alters Outlook to Pos., Affirms 'BB' ICR
[*] A&G Accepts Offers on Nine Medical Office Properties
[*] BCLP Lawyer Comments on Rising Property Market Interest Rates
[^] BOOK REVIEW: Performance Evaluation of Hedge Funds
*********
1325 ATLANTIC: Seeks More Time to File Bankruptcy Plan
------------------------------------------------------
1325 Atlantic Realty, LLC filed a motion seeking court approval to
remain in control of its bankruptcy until early next year.
In its motion, the company asked the U.S. Bankruptcy Court for the
Eastern District of New York to extend its exclusive right to file
a Chapter 11 plan and solicit acceptances from creditors to Feb. 13
and April 12, respectively.
The company will use the extension to resolve two separate lawsuits
entitled 1325 Atlantic Realty LLC v. Brooklyn Hospitality Group
LLC, Lazar Waldman, and Sands Capital LLC; and Tristate Fencing
Corp., d/b/a Rock Brokerage v. 1325 Atlantic Realty LLC, Brooklyn
Hospitality LLC, LW Developers Corp. (Supreme Court of the State of
New York, Kings County, Index No. 500831/2022).
The pre-bankruptcy lawsuits are among the major causes of the
company's bankruptcy filing and resolution of both is critical to
its ability to successfully reorganize, according to the company's
attorney, Tracy Klestadt, Esq., at Klestadt Winters Jureller
Southard & Stevens, LLP.
About 1325 Atlantic Realty
1325 Atlantic Realty, LLC, a company in Lakewood, N.J., filed a
petition for Chapter 11 protection (Bankr. E.D.N.Y. Case No.
22-40277) on Feb. 16, 2022, with up to $50 million in assets and up
to $10 million in liabilities. Esther Green, manager, signed the
petition.
Judge Nancy Hershey Lord oversees the case.
Klestadt Winters Jureller Southard & Stevens, LLP and Levine &
Associates, P.C. serve as the Debtor's bankruptcy counsel and
special litigation counsel, respectively.
212 EAST 72ND: Says Plan Proponent Acting as Buyer and Seller
-------------------------------------------------------------
Debtor 212 East 72nd Street LLC submitted a limited objection to
the First Amended Disclosure Statement explaining 72nd Ninth LLC's
Plan for the Debtor.
The Debtor points out that the Amended Disclosure Statement
containing a description of the experience and qualification of
Leslie Garfield, as the Broker being designated to sell, omits any
reference to experiences regarding sales of development sites,
experience in air rights sales, all of which are directly related
to the marketing and sale of the Real Property based upon extensive
testimony previously given in this Court. Ms. Garfield should
provide information and a resume which sets forth her experience
and background in these specific areas .
"The Broker should be required to consult and advise the Debtor of
the status and the numbers of prospective prospects. In
particular, the Broker should be required to disclose any
rejections of prospective bidders and the reasons for
such rejections. The Plan Proponent, here, acts as buyer, seller,
bidder and oversees the rejection of competing bidders. It would
be unfair to permit the Proponent to act in all these competing
roles without permitting the Debtor to have a voice in connection
with the sale," the Debtor said in court filings.
The Debtor further points out that the Amended Disclosure Statement
states that the Proponent does not believe that there are any
executory contracts or leases when the Debtor advised the Proponent
of the existence of ownership, statutory, tenancy and occupancy
rights of the Debtor's Real Property by the Debtor's principal and
her family (Amended Disclosure Statement – Page 22).
The Debtor asserts that the Amended Disclosure Statement and Plan
provide for the sale "property causes of action" including all
claims related to the Real Property but excluding any causes action
against the Proponent, which constitutes a de facto release of any
claims against the Proponent without setting forth the
consideration being paid for such releases, the nature of the
claims which are being sought to be released and any other viable
information.
The Debtor complains that the Amended Disclosure Statement provides
section 1146 transfer tax exemption for any deeds conveying the
Real Property within 2 years following the sale without explaining
the basis for such exemption, or whether the City of New York has
consented or will consent or whether a Bankruptcy Court Order can
be obtained with respect to such transaction.
Attorney for the Debtor:
Leo Fox, Esq.
630 Third Avenue - 18th Floor
New York, NY 10017
Tel: (212) 867-9595
E-mail: leo@leofoxlaw.com
About 212 East 72nd Street
212 East 72nd Street, LLC owns and operates a townhome located at
212 East 72nd St., N.Y.
212 East 72nd Street filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D.N.Y. Case No.
22-10351) on March 22, 2022, listing as much $50 million in both
assets and liabilities. Evanthia Koutis, member, signed the
petition.
Judge Lisa G. Beckerman oversees the case.
Leo Fox, Esq., in New York, represents the Debtor in its Chapter 11
case.
7614 LLC: Files for Chapter 11 Bankruptcy Protection
----------------------------------------------------
7614 LLC filed for chapter 11 protection in the Eastern District of
New York.
The Debtor is the owner of certain vacant development property
located at 7614 4th Avenue, Brooklyn, New York, having a value of
$5 million. The property was acquired out of foreclosure in 2015.
The Debtor was issued a referee's deed following the assignment of
the credit bid made by a prior lender.
There is litigation surrounding the referee's deed, as the prior
developer, Nizer Khoury, claims a disputed 15 percent interest
based upon an agreement that never became effective.
In the meanwhile, the Debtor also pursued litigation against an
adjoining property owner for breach of a contract to acquire
certain additional air rights. The Debtor obtained a judgment
against the property owner and is awaiting a decision on damages.
But the Debtor is at a crossroads since its mortgage in the
principal sum of $3.5 million is due to mature at the end of the
year. The Property cannot be refinanced with the prospect of these
two pending litigations, which have also stalled the redevelopment
of the Debtor's property.
Accordingly, the Debtor is now seeking Chapter 11 protection with
the goal of obtaining a more expeditious resolution o the
litigation claims, and thereby enhance the prospects of
refinancing.
The Debtor intends to remove the litigation with the prior
developer to the Bankruptcy Court so that the ownership dispute can
be addressed immediately.
7614 LLC estimates debt of $1 million to $10 million to 1 to 49
unsecured creditors. The petition states that funds will be
available to unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Oct. 24, 2022, at 12:00 PM at Teleconference - Brooklyn.
About 7614 LLC
7614 LLC is a Single Asset Real Estate (as defined in 11 U.S.C.
Sec. 101(51B)).
7614 LLC sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. E.D.N.Y. Case No. 22-42336) on Sept. 23, 2022. In the
petition filed by Tim Ziss, as manager and member, the Debtor
reported assets and liabilities between $1 million and $10 million
each.
The Debtor is represented by Kevin J Nash of Goldberg Weprin Finkel
Goldstein LLP.
ACTIVA RESOURCES: Cargill Wants Disclosures on Exit Financing
-------------------------------------------------------------
Cargill Inc., a creditor and holder of secured claims against
Activa Resources, LLC, and unsecured claims against Tiva Resources,
LLC. filed a joinder and limited objection to the Disclosure
Statement for Debtors' Joint Plan of Reorganization.
Cargill points out that the Disclosure Statement describes a Plan
that is largely predicated on the Debtors' securing exit financing
in the form of the New Credit Facility. The Disclosure Statement
further contemplates including in a supplement to the Plan and/or
Exhibit D to the Disclosure Statement a fulsome description of the
terms and conditions attendant to the New Credit Facility, but more
than 1 month after the Disclosure Statement's filing, and only 7
days prior to the hearing to consider approval of the Disclosure
Statement, these details have not yet been revealed. Because the
New Credit Facility is essentially the linchpin of the Plan's
proposals and directly impacts Plan feasibility, as well as the
reorganized Debtor's liquidity and solvency, creditors and
parties-in-interest cannot reasonably make an informed decision on
the Plan without significant further supplementation of the
Disclosure Statement to address these shortcomings.
Attorneys for Cargill, Inc.:
Sean B. Davis, Esq.
Steffen R. Sowell, Esq.
WINSTEAD PC
600 Travis Street, Suite 5200
Houston, TX 77002
Tel: (713) 650-8400
Fax: (713) 650-2400
E-mail: sbdavis@winstead.com
ssowell@winstead.com
About Activa Resources and Tiva Resources
Activa Resources, LLC and Tiva Resources, LLC operate in the oil
and gas extraction industry. Both companies are based in San
Antonio, Texas.
On Feb. 3, 2022, Activa Resources and Tiva Resources sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.
Tex. Lead Case No. 22-50117). In the petitions signed by John
Hayes, president, Activa Resources disclosed as much as $50 million
in both assets and liabilities while Tiva Resources disclosed up to
$10 million in assets and up to $50 million in liabilities.
Judge Michael M. Parker oversees the cases.
The Debtors tapped Bernard R. Given II, Esq., at Loeb and Loeb, LLP
as legal counsel, and Haynie & Company as accountant and auditor.
Donlin, Recano & Company, Inc. is the claims, noticing and
solicitation agent.
On Aug. 19, 2022, the Debtors filed their proposed joint Chapter 11
plan of reorganization and disclosure statement.
ACTIVA RESOURCES: Secured Lenders Get All The Risk, Says TCB
------------------------------------------------------------
Texas Capital Bank (f/k/a Texas Capital Bank, N.A.) ("TCB") filed
an objection to the Disclosure Statement for the Joint Plan of
Reorganization filed by Activa Resources, LLC, and Tiva Resources,
LLC.
According to TCB, the Plan saddles secured lenders TCB and Cargill
with all the risk, while giving the Debtors and their equity
holders a 4-year, risk-free option to effectively gamble with the
secured lenders' money in the (slim) hope that they can drill
enough producing wells to refinance and take out the current
secured debt. To be sure, the Plan proposes to make nominal
payments to TCB and Cargill for five years, with a disproportionate
balloon payment at the end of the extended new note term which can
only be paid through speculative refinancing. During this interim
period, the Debtors propose to embark upon an unprecedented
drilling schedule, which they hope generates enough value to
support a refinancing of the pre-petition secured debt. In the past
five years, the Debtors drilled or participated in only three wells
in the OSR-Halliday Unit, the Pruitt Project and the Alta Loma
Field combined. Over the next five years, the Debtors' Plan
proposes drilling or participating in 33 new wells in the same
areas. It is an unprecedented uptick in activity for which the
Debtors have no operational history, nor track record that may be
predictive of success.
TCB complains that the Debtors have admitted that if they are
forced to make the balloon payment at the end of the Plan term,
they will default on the Plan—noting that "replacement financing
[] will repay their secured debt in full." See Disclosure
Statement, pg. 5. While the Debtors propose shifting all the risk
of non-payment upon secured lenders TCB and Cargill, the Debtors
are simultaneously proposing to pay certain other secured and
unsecured creditors in full within 90 days and allowing equity to
retain its interests. This is improper.
TCB points out that the Plan as currently drafted is not fair and
equitable, is not feasible and violates the absolute priority rule.
The Plan must (a) adequately spread out the risk among all the
parties, (b) compensate TCB for the risk it does take, (c) include
reasonable financial milestones and performance metrics, and (d)
include default provisions including (but not limited to) a toggle
feature that immediately converts to a sale process in the event
such milestones and metrics are not met. The Plan must also be
predicated upon a reasonable business model, rather than a risky,
unprecedented exploration spree. And finally, the Plan cannot
violate the absolute priority rule by paying certain creditors in
full and allowing equity holders to maintain their interests, while
promising TCB and Cargill a speculative payment in full at an
uncertain date in the future. Until these very basic updates are
incorporated into a revised Plan, the Disclosure Statement cannot
and should not be approved.
TCB further points out that even assuming arguendo that the Plan
was confirmable (it is not), the Disclosure Statement nevertheless
is so lacking in basic information that it cannot be approved
without significant supplementation. Among other things, the
Disclosure Statement lacks detail about repayment terms for the
secured lenders' debt; lacks detail about the terms of proposed
exit financing or the identity of the proposed lender; lacks detail
as to the leases upon which the proposed new wells are intended to
be drilled; lacks detail about how or when the Debtors will
refinance TCB's debt; and lacks detail about the estimated value of
TCB's Collateral.
TCB asserts that the Plan is not confirmable, and the Disclosure
Statement lacks adequate information. Accordingly, this Court
should not approve the Disclosure Statement.
Counsel for Texas Capital Bank:
Michael S. Held, Esq.
J. Machir Stull, Esq.
JACKSON WALKER LLP
2323 Ross Avenue, Suite 600
Dallas, TX 75201
Telephone: (214) 953-6039
E-mail: mheld@jw.com
mstull@jw.com
- and -
J. Scott Rose, Esq.
112 E. Pecan Street, Suite 2400
San Antonio, TX 78205
Telephone: (210) 978-7700
Email: srose@jw.com
About Activa Resources and Tiva Resources
Activa Resources, LLC and Tiva Resources, LLC operate in the oil
and gas extraction industry. Both companies are based in San
Antonio, Texas.
On Feb. 3, 2022, Activa Resources and Tiva Resources sought
protection under Chapter 11 of the Bankruptcy Code (Bankr. W.D.
Tex. Lead Case No. 22-50117). In the petitions signed by John
Hayes, president, Activa Resources disclosed as much as $50 million
in both assets and liabilities while Tiva Resources disclosed up to
$10 million in assets and up to $50 million in liabilities.
Judge Michael M. Parker oversees the cases.
The Debtors tapped Bernard R. Given II, Esq., at Loeb and Loeb, LLP
as legal counsel, and Haynie & Company as accountant and auditor.
Donlin, Recano & Company, Inc. is the claims, noticing and
solicitation agent.
On Aug. 19, 2022, the Debtors filed their proposed joint Chapter 11
plan of reorganization and disclosure statement.
ALL FLORIDA SAFETY: Hits Chapter 11 Bankruptcy
----------------------------------------------
All Florida Safety Institute LLC filed for chapter 11 protection in
the Middle District of Florida. The Debtor elected on its
voluntary petition to proceed under Subchapter V of chapter 11 of
the Bankruptcy Code.
The Debtor is the operator of a driver education business which
operates throughout the State of Florida. Additionally, the Debtor
operates a used car sales facility called Florida Auto Exchange for
sales and purchases of vehicles utilized in the driver education
business.
The Debtor's business was started in 2015 by Mark and Janette Allen
and has continuously operated since that time. The Debtor has
rapidly expanded and now operates close to 30 locations throughout
the State of Florida.
During 2020-2021 as a result of shutdowns of DMV and related
facilities due to COVID-19 related issues, the Debtor's revenue
began to substantially decline. Fiscal Year 2020 saw an approximate
50% reduction in income. The Debtor began a series of merchant
cash advance loans secured by receivables and deducted on a daily
basis. This severely disrupted cash flow of the Debtor and caused
the Debtor to become delinquent to the unsecured creditors in the
amount of approximately $1,800,000.
As of August of 2022, the Debtor defaulted on numerous MCA and
supplier loans. However, the Debtor felt that the income would
significantly increase in the short term and allow a successful
reorganization for all secured, priority and unsecured debts.
Multiple creditors filed suit in New York to collect on past due
obligations owed by the Debtor.
This Chapter 11 followed in order to restructure the existing
secured debt, unsecured debt and other priority claims.
According to court filings, All Florida Safety Institute estimates
$1 million to $10 million in debt to 1 to 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
November 2, 2022 at 10:00 a.m. in Room Telephonically on telephone
conference line: 866-718-3566 (participant passcode: 2721444#).
About All Florida Safety Institute
All Florida Safety Institute LLC --
https://allfloridasafetyinstitute.com/driving -- is an
all-inclusive driving school serving Florida.
All Florida Safety Institute filed a petition for relief under
Subchapter V of Chapter 11 of the Bankruptcy Code on Sept. 22,
2022. In the petition filed by Mark Allen, as manager, the Debtor
reported assets and liabilities between $1 million and $10
million.
Aaron R. Cohen has been appointed as Subchapter V trustee.
The Debtor is represented by Bryan K. Mickler of the Law Offices of
Mickler & Mickler LLP.
ALLIANCE HOSPITALITY: Files Emergency Bid to Use Cash Collateral
----------------------------------------------------------------
Alliance Hospitality, LLC asks the U.S. Bankruptcy Court for the
District of Nebraska for authority to use cash collateral on an
interim basis in accordance with the budget, with a 15% variance
and provide adequate protection.
As with millions of businesses throughout the U.S. in the past
three years, the COVID-19 epidemic has taken its toll on the
Debtor's operations. This was and is particularly true for the
hotel industry as a whole, which saw a nearly unrivaled downturn in
business, leading one commentator to state, "as the COVID19 crisis
progresses, the impact to the travel industry is nine times worse
than 9/11, with forecasted occupancy rates for 2020 hitting record
lows worse than rates in 1933 during the Great Depression."
Building on this economic devastation, another commentator has
noted that "the hotel and hospitality industry is not expected to
make a full recovery until 2024 after being devastated by the
coronavirus pandemic."
During the Pandemic, the Debtor unsurprisingly saw a decrease in
revenues and occupancy rates, though the Debtor did not see a
proportionate reduction in its debt service obligations. The Debtor
and the City of Alliance were not immune to these challenges and
the Debtor, ultimately, defaulted under the terms of its loan with
Northeast Bank, which began foreclosure proceedings. In order to
stave off the impending trustee's sale, the Debtor left with little
choice other than to seek protection under Chapter 11 in an effort
to restructure and reduce its secured debts.
As of the Petition Date, all or substantially all of the assets of
the Debtor are subject to the liens and security interests of
Northeast Bank f.k.a Business Lenders, LLC, who filed a UCC-1
financing statement with the Nebraska Secretary of State at Filing
9907521799-2 on August 17, 2007. In addition, the Debtor has
entered into several prepetition loan documents with Northeast Bank
f.k.a Business Lenders, LLC including:
a. Promissory Note dated August 17, 2007;
b. Deed of Trust filed in the Box Butte County Register of
Deeds at Book 246 of Mortgages, Pages 158-166 on August 20, 2007.
c. Security Agreement dated August 17, 2007; and
d. Collateral Assignment of Leases and Rents dated August 17,
2007.
In addition, all or substantially all of the assets of the Debtor,
subject to the provisions of the bankruptcy code, including
applicable avoidance actions, are subject to the liens and security
interests of a number of entities, including:
a. The Internal Revenue Service, who has filed multiple
federal tax liens;
b. An entity entitled the Corporation Service Company, as
representative, who filed a UCC-1 financing statement with the
Nebraska Secretary of State at Filing 9819136062-7; and
c. The Small Business Association, who filed a UCC-1 financing
statement with the Nebraska Secretary of State at Filing
9820187789-1.
The following constitute adequate protection for the Debtor's use
of cash collateral, and to the extent of a diminution in value
resulting from the Debtor's use of cash collateral to Northeast
Bank:
a. continuing, valid, binding, enforceable, non-avoidable, and
perfected postpetition security interests in and liens on the
Prepetition Collateral.
b. Notwithstanding 11 U.S.C. section 552, Northeast Bank's
liens and security interests in the Prepetition Collateral will
continue to attach to the Debtor's post-petition assets of the same
kind and to the same extent the liens were effective or valid with
respect to the Prepetition Collateral;
c. The prepetition loan documents of Northeast Bank will
remain in full force and effect to the same extent the liens were
effective or valid prior to the Petition Date;
d. The Debtor will comply with all reporting requirements
under the prepetition loan documents of Northeast Bank and will
furnish to Northeast Bank such additional information respecting
the financial condition and results of the operation of the Debtor
as Northeast Bank may from reasonably request;
e. Northeast Bank and its agents will have the right to
inspect the books and records of the Debtor and to inspect and
appraise Northeast Bank Collateral during regular business hours
and at such other times as are mutually convenient;
f. The Debtor will make no dividends, distributions or
payments to its shareholders, investors, employees, officers or
directors in excess of that in the Budget, if any;
g. Although not provided by the Debtor, Northeast Bank also
has the personal guaranty of the Debtor's owner.
A copy of the motion and the Debtor's budget is available at
https://bit.ly/3dSgOcg from PacerMonitor.com.
The budget provides for total expenses, on a monthly basis, as
follows:
$26,200 for September 2022;
$23,950 for October 2022;
$22,850 for November 2022; and
$22,450 for December 2022.
About Alliance Hospitality, LLC
Alliance Hospitality, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Neb. Case No. 22-40840) on
September 25, 2022. In the petition signed by Anupam Dave, member,
the Debtor disclosed up to $10 million in assets and up to $1
million in liabilities.
Judge Thomas L. Saladino oversees the case.
Patrick R. Turner, Esq., at Turner Legal Group, LLC, is the
Debtor's counsel.
ALLSPRING BUYER: Fitch Cuts LongTerm IDR to 'BB-', Outlook Negative
-------------------------------------------------------------------
Fitch Ratings has downgraded the Long-Term Issuer Default Rating
(IDR) and senior secured debt rating of Allspring Buyer LLC
(Allspring) to 'BB-' from 'BB'. The Rating Outlook is Negative.
KEY RATING DRIVERS
IDR and Senior Debt
The downgrade reflects Fitch's expectations for higher leverage and
lower interest coverage following a significant decline in
Allspring's fee earning assets under management (AUM) in 1H22.
Leverage and interest coverage metrics are now in excess of Fitch's
downgrade triggers of 4.5x and 3.0x, respectively, and are not
expected to improve materially over the near term.
The Negative Outlook reflects Fitch's expectations that the
challenging market climate could continue to pressure fund flows,
which could further weaken financial metrics, most notably,
Allspring's EBITDA margin, leverage and interest coverage. A
sustained increase in leverage beyond 5x and a reduction in
interest coverage below 2x could result in additional rating
downgrades.
Allspring's ratings remain supported by its solid franchise in
traditional investment management (IM), AUM diversification by
asset class, product and distribution channel and a scalable
business model. The ratings also reflect an experienced senior
management team, a cash-generative business model and a long-term
distribution agreement with Wells Fargo Corporation (A+/Stable),
which should provide Allspring with operational and distribution
infrastructure during the transition period.
The ratings are constrained by the private equity ownership, which
introduces some uncertainty about the company's future financial
policies and the potential for more opportunistic growth
strategies, lower profitability margins, higher cash flow leverage
and lower interest coverage compared with higher rated IMs,
consistent long-term asset net outflows, the fully secured funding
profile and limited balance-sheet liquidity. Other rating
constraints include a lack of operating history as a standalone
entity and increased execution risk associated with the challenges
of bringing a new IM brand to market and setting up standalone
operations.
Allspring's AUM registered a steep decline in 1H22, falling 17.2%,
to $475 billion, from YE21. This decline was driven by both net
outflows as well as negative market effects. Fitch believes that
Allspring is reasonably-positioned among the large traditional IMs
in terms of product offering, but it remains materially smaller
than industry leaders. Allspring faced net client outflows of
around 10% in 1H22 and 6.6% in 2021, which are within Fitch's 'bb'
category benchmark range of negative 5% to negative 10% for IMs
charging fees on NAV. Although recent net outflows were largely
attributable to more transitory and lower margin money market
funds, Fitch expects that long-term asset flows will remain under
pressure due to investor risk aversion in the current operating
climate.
Allspring's fee-related EBITDA (FEBITDA) margin declined to 21% in
1H22, from 25% in 2021, despite the elimination of money market fee
waivers in a rising rate environment as management fees declined
along with fee-earning AUM (FAUM). Allspring's profitability margin
is below that of large public peers and is at the low end of
Fitch's 'bbb' category benchmark range of 20%-30%. Still, Fitch
believes further downside should be limited by the variable cost
base. FEBITDA does not include performance fees and is also
adjusted for non-recurring costs; however, this metric is sensitive
to cost overruns and Fitch's reclassification of these costs as
recurring.
Cash flow leverage (gross debt to FEBITDA) was 4.8x in 1H22,
annualized; up from 3.3x in 2021, which is higher than Fitch's
expectations as Allspring's $1.1 billion term loan was upsized by
$250 million in May 2022 and FEBITDA declined. Leverage is now at
the high end of Fitch's 'bb' category benchmark range of 3x-5x and
beyond the agency's previously articulated downgrade trigger of
4.5x. Fitch does not expect additional debt issuance, but leverage
will remain sensitive to declines in FEBITDA, resulting from a
further reduction in FAUM, as well as potential cost overruns
during the transition period of separation from Wells Fargo.
Interest coverage (FEBITDA to interest expense) was 4.7x in 1H22,
but adjusting for the full run rate of interest expenses, higher
market rates and a $250 million upsize in May, Fitch expects
coverage to decline to under 3x, which would be beyond Fitch's
previously downgrade trigger of 3x and within the agency's 'b and
below' category band of 3x or less. Fixed charge coverage, which
includes also a 1% loan amortization per annum, was 3.9x for the
1H22 period. Interest and fixed charge coverage remain sensitive to
further FEBITDA declines as well as further interest rate rises.
Fitch views Allspring's liquidity as relatively limited. At Dec.
31, 2021, the company had $289 million of balance-sheet cash and
$170 million of revolver capacity, although availability on the
revolver could be constrained by a market dislocation that reduces
FEBITDA, as the revolver has a leverage covenant (6.5x tested at
35% utilization). There are no term debt maturities until 2027, but
the secured term loan has a 1% annual amortization requirement. The
$250 million term loan upsize in May 2022 was used to fund a
shareholder distribution and Fitch does not anticipate any
additional distributions over the near term.
The secured debt rating is equalized with the Long-Term IDR,
reflecting the current funding mix and Fitch's expectations for
average recovery prospects under a stressed scenario.
Potential exposure to opportunistic growth strategies (arising from
Allspring's private equity ownership) as well as execution risk
associated with establishing the firm as a standalone business post
the Wells Fargo separation and the achievement of envisioned cost
savings and deleveraging negatively affects Fitch's assessment of
Management and Strategy.
RATING SENSITIVITIES
IDR
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Material differences between future consolidated audited
financial statements relative to management representations;
- An inability to sustain cash flow leverage below 5x,
particularly if driven by additional debt-financed
shareholder-friendly distributions;
- Sustained material investment underperformance and/or meaningful
long-term AUM outflows;
- A liquidity shortfall or a decline in interest coverage below
2.0x;
- An inability to execute on the operating strategy, leading to
excessive costs or operational failures, or a decline in FEBITDA
margins below 10%.
Factors that could, individually or collectively, lead to positive
rating action/upgrade, including a revision of the Outlook to
Stable:
- Stabilization in FAUM and the FEBITDA margin;
- A sustained improvement in reported cash flow leverage below
4.5x;
- Sustained interest coverage above 3.0x;
- Favorable investment performance and material improvements of
net flows, in particular, long-term net client flows.
Senior Secured Debt
The secured debt rating is primarily sensitive to changes in
Allspring's IDR, and secondarily to material changes in Allspring's
funding mix, and/or changes in Fitch's assessment of the recovery
prospects for the debt instrument.
ESG CONSIDERATIONS
Allspring Buyer LLC has an ESG Relevance Score of '5' for
Governance Structure due to private equity ownership, which may
result in more opportunistic growth strategies or
shareholder-friendly financial policies, which has a negative
impact on the credit profile, and is relevant to the ratings in
conjunction with other factors.
Allspring Buyer LLC has an ESG Relevance Score of '4' for Financial
Transparency due to the sensitivity of the rating to alignment of
audited financial data with management representations, which has a
negative impact on the credit profile, and is relevant to the
ratings in conjunction with other factors.
Allspring Buyer LLC has an ESG Relevance Score of '4' for
Management Strategy due to the execution risk associated with
establishing the firm as a standalone business, achievement of
envisioned cost savings and deleveraging, which has a negative
impact on the credit profile, and is relevant to the ratings in
conjunction with other factors.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Debt Rating Prior
---- ------ -----
Allspring Buyer LLC
LT IDR BB- Downgrade BB
senior secured
LT BB- Downgrade BB
ARCHBISHOP OF AGANA: Unsecured Creditors Unimpaired in Plan
-----------------------------------------------------------
The Archbishop of Agana and its Official Committee of Unsecured
Creditors submitted a Fourth Amended Joint Chapter 11 Plan of
Reorganization.
Under the Plan, holders of 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. Class 5 is unimpaired.
This Plan will be funded from the sources and in the manner set
forth below:
1. Contributions. Cash and other assets will be paid or
transferred, as applicable, to the Trust Account as provided in the
Plan:
(i) Debtor Real Estate. The Debtor will transfer the parcels
of real property with an estimated value of $18,358,034 to the
Trust, free and clear of all claims, liens, and encumbrances
pursuant to 11 U.S.C. section 1123(a)(5)(d);
(ii) Debtor Cash Contribution. The Debtor will transfer
$6,609,998.29 to the Trust.
(iii) Settling Insurer Contributions. The Settling Insurers
will transfer to the Trust the respective Settlement Amounts set
forth in Section 7.11(a) as follows: $18,000,000, subject to the
terms and conditions of the AIG Insurers Settlement Agreement as
approved by a Final Order.
(iv) Unknown Claims. The Reorganized Debtor will establish the
Unknown Tort Claim Reserve Fund in the minimum initial amount of
$200,000.00.
(v) Tuition Vouchers. The Reorganized Debtor will provide the
Trust with 150 vouchers for a K-12 Catholic education, which
voucher shall cover 100% of the cost of tuition each year for a
total of not more than thirteen years at any Catholic school in
Guam. The form of "Scholarship Vouchers", including the terms and
conditions of use, are set forth in Exhibit R.
(vi) Cemetery Vouchers. The Reorganized Debtor will provide
the Trust with 50 vouchers, which voucher shall cover 100% of a
cemetery plot easement at a Catholic cemetery in Guam. The form of
"Cemetery Voucher", including the terms and conditions of use, are
set forth at Exhibit S.
(vii) Proceeds of Real Property Sales. Prior to the Effective
Date, the Debtor will market and sell 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
to renovate and outfit the Cathedral for use as the Reorganized
Debtor's headquarters and Chancery office and moving expenses (iv)
$200,000 for the Unknown Claimants funding, and (v) after the
payment of the amounts in(i)-(iv) the remaining proceeds will be
distributed to the Trust. The sale of the Chancery Real Property
shall include six months delayed possession to accommodate the
move. The UCC shall have the right to approve the Debtor's real
estate agent and the terms and conditions of the sale of the two
properties.
2. Additional Trust Insurance Assets: In addition to the funds
and real property transferred to the Trust, the Transferred
Insurance Interests of the Archdiocese are automatically and
without further act or deed assigned and transferred to the Trust
on the Effective Date. In addition, the Interests of the other
Protected Parties in the Transferred Insurance Interests are
automatically and without further act or deed assigned and
transferred to the Trust on the Effective Date. The foregoing
assignment and transfer shall not be construed as an assignment and
transfer of the Non-Settling Insurer Policies.
3. Additional Trust Property Assets: In addition to the
properties transferred to the Trust as listed on Exhibit G, any
interest, cause of action, claim, title, or other right of the
Archdiocese related to any real property not listed on the Debtor's
schedules as of the Confirmation Date will be assigned and
transferred to the Trust on the Effective Date. The Debtor does not
warrant or represent that any such interest exists. The Trustee
shall have full standing, authority, and right to initiate any
action necessary to obtain title or any other interest in real
property that is owned, held, or possessed by the Debtor on the
Confirmation Date, whether or not such right or interest is vested
or unvested, contingent, liquidated, or otherwise, if such right,
title, and/or interest was not listed on the Debtor's schedules as
of the Confirmation Date. The transfer under this subsection of an
interest, cause of action, claim, title, or other right shall not
be a definitive determination of the existence, validity, or extent
of any interest, cause of action, claim, title, or other right of
the Archdiocese.
4. Vesting. On the Effective Date, all Trust Assets shall vest
in the Trust, and the Archdiocese and other Protected Parties shall
be deemed for all purposes to have transferred all of their
respective Interests in the Trust Assets to the Trust. On the
Effective Date, or as soon as practicable thereafter, the
Reorganized Debtor, any other Protected Party, and Settling
Insurers, as applicable, shall take all actions reasonably
necessary to transfer any Trust Assets to the Trust. Upon the
transfer of control of Trust Assets in accordance with this
paragraph, the Archdiocese, the other Protected Parties and the
Settling Insurers shall have no further interest in or with respect
to the Trust Assets except as otherwise explicitly provided in this
Plan.
Attorneys for the Archbishop of Agana:
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
- and -
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
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
Tel: 612-335-1500
Fax: 612-335-1657
E-mail: robert.kugler@stinson.com
ed.caldie@stinson.com
drew.glasnovich@stinson.com
A copy of the Fourth Amended Joint Chapter 11 Plan of
Reorganization dated September 21, 2022, is available at
https://bit.ly/3S9TXaW from PacerMonitor.com.
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.
BINGHAMTON PLAZA: Mayor Touts Case Dismissal, Eyes Property
-----------------------------------------------------------
Matthew Benninger of 12 News reports that Binghamton Mayor Jared
Kraham announced an update regarding a federal case involving the
Binghamton Plaza owners.
According to Kraham, a US Bankruptcy Couty Judge signed an order
that dismissed a Chapter 11 Bankruptcy involving the owners of the
plaza, who are based in New Jersey.
Kraham said the order also "dismisses the shield that may have
given the Plaza owners protection from a number of government
actions, including eminent domain proceedings by the City of
Binghamton."
Kraham called the dismissal an early victory for Binghamton and a
step forward for the city to gain control of the plaza, which has
fallen into disrepair.
"The Binghamton Plaza has continued to deteriorate for decades,
diminishing quality of life for North Side families and hurting
nearby small businesses," Kraham said. "Enough is enough."
In July 2022, attorneys for the city filed a motion in federal
court to allow the city to begin the process of acquiring the plaza
through eminent domain.
About Binghamton Plaza
Binghamton Plaza, Inc., owns the retail center Binghampton Plaza at
33 West State Street Binghamton, NY 1390. Controlled by New
Jersey-based Galesi Realty, the property was once a thriving retail
center that included a grocery, shopping and a first-run movie
theater but the property has fallen into disrepair.
Binghamton Plaza, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. N.D.N.Y. Case No. 19-60875) on June 13,
2019. At the time of the filing, the Debtor estimated assets of
less than $500,000 and liabilities of less than $1 million. Barclay
Damon LLP is the Debtor's counsel.
BOY SCOUTS: Insurers File Appeals Opposing Plan Approval
--------------------------------------------------------
More than a dozen insurers that opposed the Chapter 11 plan of the
Boy Scouts of America filed notices of appeal Sept. 21, 2022, in
Delaware's bankruptcy court, with respect to the order confirming
the Boy Scout's bankruptcy-exit plan.
To recall, on Sept. 8, 2022, the Bankruptcy Court approved the Boy
Scouts' chapter 11 plan of reorganization, establishing the overall
framework for a survivor trust that will evaluate and pay claims.
Plan approval comes more than two and half years after the case was
filed and after parties agreed to a sex abuse victims fund of
around $2.7 billion for 82,000 adults who allege they were sexually
abused in their youth as scouts.
Insurers that did not join the settlements and are appealing
approval of the Plan are:
* National Union Fire Insurance Company of Pittsburgh, Pa.,
Lexington Insurance Company, Landmark Insurance Company, and The
Insurance Company of the State of Pennsylvania;
* Travelers Casualty and Surety Company, Inc. (f/k/a Aetna
Casualty & Surety Company), St. Paul Surplus Lines Insurance
Company and Gulf Insurance Company;
* The Continental Insurance Company and Columbia Casualty
Company;
* Allianz Global Risks US Insurance Company, National Surety
Corporation, and Interstate Fire & Casualty Company;
* Argonaut Insurance Company and Colony Insurance Company;
* Arrowood Indemnity Company;
* Liberty Mutual Insurance Company;
* Old Republic Insurance Company;
* General Star Indemnity Company;
* Indian Harbor Insurance Company, on behalf of itself and as
successor in interest to Catlin Specialty Insurance Company;
* Munich Reinsurance America, Inc., formerly known as American
Re-Insurance Company;
* Arch Insurance Company;
* Great American Assurance Company f/k/a Agricultural Insurance
Company, Great American E&S Insurance Company f/k/a Agricultural
Excess and Surplus Insurance Company, and Great American E&S
Insurance Company;
* Gemini Insurance Company; and
* Traders and Pacific Insurance Company, Endurance American
Specialty Insurance Company, and Endurance American Insurance
Company.
Other parties that filed notices of appeal are:
-- The Tort Claimants represented by Lujan & Wolff LLP
-- Archbishop of Agaña, a Corporation Sole
-- Claimants represented by Dumas & Vaughn, LLC
National Union, et al.'s counsel:
FINEMAN KREKSTEIN & HARRIS PC
Deirdre M. Richards
1300 N. King Street
Wilmington, DE 19801
Telephone: (302) 538-8331
Email: drichards@finemanlawfirm.com
-and-
GIBSON, DUNN & CRUTCHER LLP
Michael A. Rosenthal
Mitchell A. Karlan
James Hallowell
Keith R. Martorana
200 Park Avenue
New York, New York 10166
Telephone: (212) 351-4000
Email: mrosenthal@gibsondunn.com
mkarlan@gibsondunn.com
jhallowell@gibsondunn.com
kmartorana@gibsondunn.com
GIBSON, DUNN & CRUTCHER LLP
Richard J. Doren
Blaine H. Evanson
333 South Grand Avenue
Los Angeles, California 90071
Telephone: (213) 229-7038
Email: rdoren@gibsondunn.com
bevanson@gibsondunn.com
FORAN GLENNON PALANDECH PONZI & RUDLOFF P.C.
Susan N.K. Gummow
222 N. LaSalle St., Suite 1400
Chicago, Illinois 60601
Telephone: (312) 863-5000
Email: sgummow@fgppr.com
Travelers Casualty's counsel:
REGER RIZZO & DARNALL LLP
Louis J. Rizzo, Jr.
1521 Concord Pike, Suite 305
Brandywine Plaza West
Wilmington, Delaware 19803
Telephone: (302) 477-7100
Email: lrizzo@regerlaw.com
Continental Insurance's counsel:
GOLDSTEIN & MCCLINTOCK LLLP
Maria Aprile Sawczuk (DE #3320)
501 Silverside Road
Wilmington, DE 19809
302-444-6710
marias@goldmclaw.com
-and-
LOEB & LOEB LLP
Laura McNally
Emily Stone
321 N. Clark Street, Suite 2300
Chicago, IL 60654
312-464-3155
E-mail: lmcnally@loeb.com
estone@loeb.com
-and-
DAVID CHRISTIAN ATTORNEYS LLC
David Christian
105 W. Madison St., Suite 1400
Chicago, IL 60602
Telephone: (312) 282-5282
Email: dchristian@dca.law
Allianz Global's counsel:
TROUTMAN PEPPER HAMILTON SANDERS LLP
David M. Fournier
Marcy J. McLaughlin Smith
Hercules Plaza
1313 Market Street
Suite 5100
P.O. Box 1709
Wilmington, DE 19899-1709
Telephone: 404.885.3000
Email: david.fournier@troutman.com
marcy.smith@troutman.com
-and-
PARKER, HUDSON, RAINER & DOBBS
Harris B. Winsberg
303 Peachtree Street NE
Suite 3600
Atlanta, GA 30308
Telephone: 404.420.4313
Email: hwinsberg@phrd.com
-and-
McDERMOTT WILL & EMERY LLP
Margaret H. Warner
Ryan S. Smethurst
Alex M. Spisak
The McDermott Building
500 North Capitol Street, NW
Washington, DC 20001-1531
Telephone: 202.756.8228
Email: mwarner@mwe.com
rsmethurst@mwe.com
aspisak@mwe.com
Argonaut Insurance's counsel:
POST & SCHELL, P.C.
Paul Logan
300 Delaware Avenue, Suite 1380
Wilmington, DE 19801
Telephone: (302) 251-8856
Email: plogan@postschell.com
POST & SCHELL, P.C.
John C. Sullivan
Kathleen K. Kerns
Four Penn Center – 13th Floor
1600 John F. Kennedy Boulevard
Philadelphia, PA 19103
Telephone: (215) 587-1000
Email: jsullivan@postschell.com
kkerns@postschell.com
-and-
IFRAH PLLC
George R. Calhoun
1717 Pennsylvania Avenue, N.W., Suite 650
Washington, DC 20006
Telephone: (202) 840-8758
Email: george@ifrahlaw.com
Arrowood Indemnity's counsel:
JOYCE, LLC
Michael J. Joyce
1225 King Street, Suite 800
Wilmington, DE 19801
Telephone: (302) 388-1944
Email: mjoyce@mjlawoffices.com
-and-
COUGHLIN MIDLIGE & GARLAND, LLP
Kevin Coughlin
Lorraine Armenti
Michael Hrinewski
350 Mount Kemble Avenue
PO Box 1917
Morristown, NJ 07962
Telephone: (973) 267-0058
Email: larmenti@cmg.law
mhrinewski@cmg.law
-and-
CARRUTHERS & ROTH, P.A.
Britton C. Lewis
235 N. Edgeworth Street
P.O. Box 540
Greensboro, NC 27401
Telephone: (336) 478-1146
Email: bcl@crlaw.com
Liberty Mutual's attorneys:
SEITZ, VAN OGTROP & GREEN, P.A
R. Karl Hill
222 Delaware Avenue
Suite 1500
Wilmington, Delaware 19801
Telephone: (302) 888-0600
Email: khill@svglaw.com
-and-
CHOATE, HALL & STEWART, LLP
Douglas R. Gooding
Jonathan D. Marshall
Two International Place
Boston, MA 02110
Telephone: (617) 248-5000
Email: dgooding@choate.com
jmarshall@choate.com
-and-
MINTZ, LEVIN, COHN, FERRIS, GLOVSKY AND POPEO PC
Kim V. Marrkand
Laura Bange Stephens
One Financial Center
Boston, MA 02111
Telephone: (617) 542-6000
Email: kmarrkand@mintz.com
lbstephens@mintz.com
Old Republic's counsel:
MORRIS JAMES LLP
Stephen M. Miller
Carl N. Kunz, III
Sarah M. Ennis
500 Delaware Avenue, Suite 1500
Wilmington, Delaware 19801
Telephone: (302) 888-6800
Email: smiller@morrisjames.com
ckunz@morrisjames.com
sennis@morrisjames.com
-and-
FOX SWIBEL LEVIN & CARROLL LLP
Margaret M. Anderson, Esq.
Ryan T. Schultz
Adam A. Hachikian
Kenneth M. Thomas
200 W. Madison Street, Suite 3000
Chicago, Illinois 60606
Telephone: (312) 224-1200
Email: panderson@foxswibel.com
rschultz@foxswibel.com
ahachikian@foxswibel.com
kthomas@foxswibel.com
General Star's counsel:
SMITH, KATZENSTEIN & JENKINS LLP
Kathleen M. Miller
1000 West Street, Suite 501
P.O. Box 410
Wilmington, DE 19899
Telephone: (302) 652-8400
E-mail: kmiller@skjlaw.com
-and-
WILEY REIN LLP
Mary E. Borja
Gary P. Seligman
Ashley L. Criss
2050 M Street NW
Washington, DC 20036
Telephone: (202) 719-7000
Email: mborja@wiley.law
gseligman@wiley.law
acriss@wiley.law
Indian Harbor's counsel:
SMITH, KATZENSTEIN & JENKINS LLP
Kathleen M. Miller
1000 West Street, Suite 1501
P.O. Box 410
Wilmington, DE 19899 [Courier 19801]
Telephone: (302) 652-8400
Email: kmiller@skjlaw.com
-and-
MOUND COTTON WOLLAN & GREENGRASS LLP
Lloyd A. Gura
Pamela J. Minetto
One New York Plaza 44th Floor
New York, NY 10004
Telephone: (212) 804-4282
Email: lgura@moundcotton.com
pminetto@moundcotton.com
Munich Reinsurance's counsel:
DILWORTH PAXSON LLP
Thaddeus J. Weaver (Id. No. 2790)
704 King Street, Suite 500
P.O. Box 1031
Wilmington, DE 19899-1031
Telephone: (302) 571-8867
Email: tweaver@dilworthlaw.com
-and-
DILWORTH PAXSON LLP
William E. McGrath, Jr. (Admitted PHV)
2 Research Way, Suite 103
Princeton, NJ 08540
Telephone: (609) 924-6000
Email: wmcgrath@dilworthlaw
Arch Insurance's counsel:
SMITH, KATZENSTEIN & JENKINS LLP
Kathleen M. Miller
1000 North West Street, Suite 1501
P.O. Box 410
Wilmington, DE 19899 (courier 19801)
Telephone: (302) 652-8400
Email: kmiller@skjlaw.com
-and-
HANGLEY ARONCHICK SEGAL PUDLIN & SCHILLER
Ronald P. Schiller
Matthew A. Hamermesh
Sharon F. McKee
Elizabeth C. Dolce
One Logan Square, 27th Floor
Philadelphia, PA 19103
Telephone: (215) 568 6200
Email: rschiller@hangley.com
mhamermesh@hangley.com
smckee@hangley.com
edolce@hangley.com
Traders and Pacific's counsel:
COZEN O'CONNOR
Marla S. Benedek (No. 6638)
1201 N. Market Street, Suite 1001
Wilmington, DE 19801
Telephone: (302) 295-2024
Email: mbenedek@cozen.com
Gemini Insurance's counsel:
WERB & SULLIVAN
Brian A. Sullivan (No. 2098)
LEGAL ARTS BUILDING
1225 N. King Street
Suite 600
Wilmington, Delaware 19801
Telephone: (302) 652-1100
Cell: (302) 757-9932
Facsimile: (302) 652-1111
Email: bsullivan@werbsullivan.com
-and-
GIEGER LABORDE & LAPEROUOSE, LLC
John E.W. Baay II
701 Poydras Street
Suite 4800
New Orleans, LA 70139
Tel: 504-561-0400
Fax: 504-561-1011
Email: jbaay@glllaw.com
-and-
KIERNAN TREBACH LLP
William H. White Jr.
1233 20th Street, NW
8th Floor
Washington, DC 20036
Tel: 202-712-7000
Fax: 202-712-7100
Email: wwhite@kiernantrebach.com
Great American's counsel:
BODELL BOVE, LLC
Bruce W. McCullough
1225 N. King Street, Suite 1000
P.O. Box 397
Wilmington, DE 19899-0397
Telephone: (302) 655-6749
Email: bmccullough@bodellbove.com
- and -
CLYDE & CO US LLP
Bruce D. Celebrezze
150 California Street, 15th Floor
San Francisco, California 94111
Telephone: (415) 365-9800
Email: bruce.celebrezze@clydeco.us
Konrad R. Krebs
340 Mt. Kemble Avenue, Suite 300
Morristown, NJ 07960
Telephone: (973) 210-6700
Email: konrad.krebs@clydeco.us
- and –
DAVID CHRISTIAN ATTORNEYS LLC
David Christian
105 W. Madison Street, Suite 1400
Chicago, IL 60602
Telephone: 312-282-5282
Email: dchristian@dca.law
About Boy Scouts of America
The Boy Scouts of America -- https://www.scouting.org/ -- is a
federally chartered non-profit corporation under title 36 of the
United States Code. Founded in 1910 and chartered by an act of
Congress in 1916, the BSA's mission is to train youth in
responsible citizenship, character development, and self-reliance
through participation in a wide range of outdoor activities,
educational programs, and, at older age levels, career-oriented
programs in partnership with community organizations. Its national
headquarters is located in Irving, Texas.
The Boy Scouts of America and affiliate Delaware BSA, LLC, sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on
Feb. 18, 2020, to deal with sexual abuse claims.
Boy Scouts of America was estimated to have $1 billion to $10
billion in assets and at least $500 million in liabilities as of
the bankruptcy filing.
The Debtors have tapped Sidley Austin LLP as their bankruptcy
counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel,
and Alvarez & Marsal North America, LLC, as financial advisor.
Omni Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed a tort claimants' committee
and an unsecured creditors' committee on March 5, 2020. The tort
claimants' committee is represented by Pachulski Stang Ziehl &
Jones, LLP, while the unsecured creditors' committee is represented
by Kramer Levin Naftalis & Frankel, LLP.
CALUMET PAINT: Gets Cash Collateral Access Thru Nov 30
------------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Illinois,
Eastern Division, authorized Calumet Paint & Wallpaper, Inc. to use
cash collateral on an interim basis and provide related relief for
the period October 1 through November 30, 2022 in accordance with
the budget.
In return for the Debtor's continued interim use of cash
collateral, Pratt & Lambert United, Inc. and PPG Architectural
Finishes, Inc. are granted adequate protection for the diminution
in value of their purported secured interests:
1. The Debtor will permit the Secured Creditors to inspect,
upon reasonable notice, within reasonable hours, the Debtor's books
and records;
2. The Debtor will maintain and pay premiums for insurance to
cover all of its assets from fire, theft and water damage;
3. The Debtors will, upon reasonable request, make available
to the Secured Creditors evidence of that which constitutes their
collateral or proceeds;
4. The Debtor will properly maintain its assets in good repair
and properly manage its business;
5. The Secured Creditors will be granted valid, perfected,
enforceable security interests in and to the Debtor's post-petition
assets, including all proceeds and products which are now or
hereafter become property of this estate to the extent and priority
of their alleged pre-petition liens, if valid, but only to the
extent of any diminution in the value of such assets during the
period from the commencement of the Debtor's Chapter 11 case
through November 30, 2022.
A further hearing on the Motion is scheduled for November 30 at
9:30 a.m.
A copy of the order is available at https://bit.ly/3SlmcUc from
PacerMonitor.com.
About Calumet Paint & Wallpaper, Inc.
Calumet Paint & Wallpaper, Inc. is an Illinois corporation
operating from leased premises at 12120 Western Avenue, Blue
Island, Illinois. Calumet Paint has been in business since 1957 and
is currently an authorized Benjamin Moore retailer specializing in
the sale of interior and exterior paints, stains and related
supplies. Calumet Paint sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. N.D. Ill. Case No. 21-11709 on October
13, 2021. In the petition signed by Mark R. Lavelle, president, the
Debtor disclosed up to $1 million in both assets and liabilities.
Judge Timothy A. Barnes oversees the case.
David K. Wench, Esq., at Burke, Warren, MacKay and Serritella, PC
is the Debtor's counsel.
CELSIUS NETWORK: Creditors Committee Members Disclose Claims
------------------------------------------------------------
The Official Committee of Unsecured Creditors in the Chapter 11
cases of Celsius Network, et al., filed a verified statement under
Rule 2019 of the Federal Rules of Bankruptcy Procedure, wherein
Committee members provided details of their claims against the
Debtors.
On July 27, 2022, the United States Trustee for the Southern
District of New York appointed the Committee pursuant to section
1102 of the Bankruptcy Code. See Docket No. 241. On July 30, 2022,
the Committee hired White & Case LLP to serve as its counsel in
connection with the Debtors' chapter 11 cases. On September 15,
2022, the Court entered an order approving the Committee's
retention of White & Case.
The Committee is comprised of seven members, each of whom holds
crypto assets through the Celsius platform. The members of the
Committee are: (i) Caroline Warren; (ii) Thomas DiFiore; (iii) ICB
Solutions; (iv) Christopher Coco; (v) Andrew Yoon; (vi) Mark
Robinson; and (vii) Covario AG.
As of Sept. 28, 2022, members of the Ad Hoc Group and their
disclosable economic interests are:
Caroline Warren
* Custody Wallet: BTC 0.004946
USDC 706.221757
* Earn Account: BTC 0.000979
USDC 69.001554
* Loan Collateral: BTC 11.531034
Thomas DiFiore
* Custody Wallet: BTC 45.754133
* Earn Account: BTC 333.610608
CEL 1,068,307.0382
USDC 873.49
DAI 1,997
* Loan Collateral: BTC 1,045.50160645
CEL 1,835,023.06489916
ICB Solutions
* Earn Account: BTC 80.60941
CEL 267.8476
ETH 11,175.82
USDC 0.184808
DAI 20.67589
OMG 8,865.712
SNX 14.84127
UNI 9,583.343
ZRX 0.090031
BCH 15.02527
COMP 13.09783
GUSD 12.99199
LTC 237.1825
Christopher Coco
* Earn Account: BTC 3.072198
CEL 794.6296
ETH 7.546449
USDC 4,998.718077
Andrew Yoon
* Custody Wallet: BTC 33.183348
* Earn Account: BTC 65.352263
* Loan Collateral: BTC 284.600931
Mark Robinson
* Custody Wallet: ETH 10.946015
USDC 3,741.723765
* Earn Account: BTC 0.000732
ETH 0.009382
USDC 5.161258
Covario AG
* Earn Account: BTC 215.135908
ETH 5,224.689292
LINK 112,338.413167
USDC 974,594.421649
Proposed Counsel to the Official Committee of Unsecured Creditors
can be reached at:
WHITE & CASE LLP
David M. Turetsky, Esq.
Samuel P. Hershey, Esq.
Keith H. Wofford, Esq.
1221 Avenue of the Americas
New York, NY 10020
Telephone: (212) 819-8200
Facsimile: (212) 354-8113
E-mail: david.turetsky@whitecase.com
sam.hershey@whitecase.com
kwofford@whitecase.com
– and –
WHITE & CASE LLP
Michael C. Andolina, Esq.
Gregory F. Pesce, Esq.
111 South Wacker Drive, Suite 5100
Chicago, IL 60606
Telephone: (312) 881-5400
Facsimile: (312) 881-5450
E-mail: mandolina@whitecase.com
gregory.pesce@whitecase.com
– and –
WHITE & CASE LLP
Aaron E. Colodny, Esq.
555 South Flower Street, Suite 2700
Los Angeles, CA 90071
Telephone: (213) 620-7700
Facsimile: (213) 452-2329
E-mail: aaron.colodny@whitecase.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/3xZtwN2
About Celsius Network
Celsius Network LLC -- http://www.celsius.network/-- is a
financial services company that generates revenue through
cryptocurrency trading, lending, and borrowing, as well as by
engaging in proprietary trading.
Celsius helps over a million customers worldwide to find the path
towards financial independence through a compounding yield service
and instant low-cost loans accessible via a web and mobile app.
Celsius has a blockchain-based fee-free platform where membership
provides access to curated financial services that are not
available through traditional financial institutions.
The Celsius Wallet claims to be one of the only online crypto
wallets designed to allow members to use coins as collateral to get
a loan in dollars, and in the future, to lend their crypto to earn
interest on deposited coins (when they're lent out).
Crypto lenders such as Celsius boomed during the COVID-19 pandemic,
drawing depositors with high interest rates and easy access to
loans rarely offered by traditional banks. But the lenders'
business model came under scrutiny after a sharp sell-off in the
crypto market spurred by the collapse of major tokens terraUSD and
luna in May 2022.
New Jersey-based Celsius froze withdrawals in June 2022, citing
"extreme" market conditions, cutting off access to savings for
individual investors and sending tremors through the crypto
market.
The list of major crypto firms that have filed for bankruptcy
protection in 2022 now includes Celsius Network, Three Arrows
Capital and Voyager Digital.
Celsius Network LLC and its subsidiaries sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No.
22-10964) on July 14, 2022. In the petition filed by CEO Alex
Mashinsky, the Debtor estimated assets and liabilities between $1
billion and $10 billion.
Kirkland & Ellis LLP is serving as legal counsel, Centerview
Partners is serving as financial advisor, and Alvarez & Marsal is
serving as restructuring advisor to Celsius.
Stretto, the claims agent, maintain the page
https://cases.stretto.com/celsius
CELSIUS NETWORK: Might Consider Turning Debt to Crypto 'IOU' Tokens
-------------------------------------------------------------------
Cheyenne Ligon of Yahoo! Finance reports that bankrupt crypto
lender Celsius Network appears to be considering a plan to turn its
debt into crypto "IOU" ("I Owe You") tokens.
Celsius filed for Chapter 11 bankruptcy protection in July 2022, a
month after halting withdrawals because of a liquidity crisis it
blamed on "extreme market conditions." Subsequent bankruptcy
proceedings in the Southern District of New York have revealed the
depths of Celsius' financial troubles: The lender owes 500,000
creditors nearly $5 billion.
Even if Celsius sold all of its assets -- including its mysterious,
half-finished mining subsidiary, Celsius Mining that Celsius'
executives and bankruptcy lawyers have pinned their hopes on to get
out of debt -- it would still be left with a $1.2 billion hole in
its balance sheet.
Instead, a leaked audio recording of an internal Celsius meeting --
shared by Celsius customer and YouTuber Tiffany Fong -- indicates
that Celsius is considering an alternative method for repaying
customers: wrapping the bitcoin, ether and USDC it owes customers
into a token that, as Celsius co-founder and Chief Technology
Officer Nuke Goldstein explains, "represents the ratio between how
much we really owe and how much we really have."
Customers could then either redeem the wrapped "IOU tokens" (though
a timeline for these redemptions remains unclear), trade them on
the open market or hold them to speculate on Celsius' potential
recovery in the long term.
In another leaked call shared by Fong, Celsius executives told
employees at an all-hands meeting on Sept. 8, 2022 that Celsius'
CEO Alex Mashinsky had already shared the plan to issue the IOU
tokens with the unsecured creditors committee, which reacted with
"positive feedback."
"This is really how we resolve this, how we get out," Oren
Blonstein, Celsius' chief compliance officer, told employees at the
meeting. "What we do in this pivotal moment can be through
unprecedented, really innovative solutions and this [plan] is one
of them."
The plan, if accepted by the unsecured creditors committee,
however, wouldn't exactly be unprecedented.
Liquidity-strapped Chinese mining pool operator Poolin suspended
withdrawals from its wallet service earlier this month. A week
later, it announced that it would issue IOU tokens to affected
customers representing a 1:1 ratio of user balances across six
cryptocurrencies.
The plan also bears some resemblance to Bitfinex's recovery plan
following a hack that drained 120,000 bitcoins (BTC) from the
exchange's reserves in mid-2016. The exchange issued debt tokens
to customers affected by the hack, which were then traded on the
open market -- often for much less than their $1 face value. By
April 2017, Bitfinex had bought back all of its remaining debt
tokens.
About Celsius Network
Celsius Network LLC -- http://www.celsius.network/-- is a
financial services company that generates revenue through
cryptocurrency trading, lending, and borrowing, as well as by
engaging in proprietary trading.
Celsius helps over a million customers worldwide to find the path
towards financial independence through a compounding yield service
and instant low-cost loans accessible via a web and mobile app.
Celsius has a blockchain-based fee-free platform where membership
provides access to curated financial services that are not
available through traditional financial institutions.
The Celsius Wallet claims to be one of the only online crypto
wallets designed to allow members to use coins as collateral to get
a loan in dollars, and in the future, to lend their crypto to earn
interest on deposited coins (when they're lent out).
Crypto lenders such as Celsius boomed during the COVID-19 pandemic,
drawing depositors with high interest rates and easy access to
loans rarely offered by traditional banks. But the lenders'
business model came under scrutiny after a sharp sell-off in the
crypto market spurred by the collapse of major tokens terraUSD and
luna in May 2022.
New Jersey-based Celsius froze withdrawals in June 2022, citing
"extreme" market conditions, cutting off access to savings for
individual investors and sending tremors through the crypto
market.
The list of major crypto firms that have filed for bankruptcy
protection in 2022 now includes Celsius Network, Three Arrows
Capital and Voyager Digital.
Celsius Network LLC and its subsidiaries sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case
No.22-10964) on July 14, 2022. In the petition filed by CEO Alex
Mashinsky, the Debtor estimated assets and liabilities between $1
billion and $10 billion.
Kirkland & Ellis LLP is serving as legal counsel, Centerview
Partners is serving as financial advisor, and Alvarez & Marsal is
serving as restructuring advisor to Celsius. Stretto, the claims
agent, maintains the page https://cases.stretto.com/celsius
On July 27, 2022, the U.S. Trustee appointed an official committee
of unsecured creditors. On July 29, 2022, the committee voted to
retain White & Case as its counsel. The committee tapped Elementus
as blockchain forensics advisor, M3 as its financial advisor, and
Perella Weinberg Partners LP as its investment banker.
CELSIUS NETWORK: Washington State Joins Bankruptcy Case
-------------------------------------------------------
Sam Reynolds of CoinDesk reports that the bankruptcy case of
beleaguered crypto lending platform Celsius has a new interested
party: the Washington State Department of Financial Institutions.
In a motion filed Thursday, September 22, 2022, evening, the
state's Assistant Attorney General Stephen Manning asked Judge
Martin Glenn, who is overseeing the case, to admit him on behalf of
Washington's financial regulator.
Securities regulators in Washington, Alabama, Kentucky, New Jersey
and Texas began an investigation into Celsius after the company
suspended customer redemptions in June 2022.
While the U.S. Securities and Exchange Commission (SEC) has been
working with its counterparts to regulate crypto via Washington,
D.C., states such as Washington have taken a more active approach
in regulation as there's a growing belief that the Feds are moving
too slowly.
The Vermont Department of Financial Regulation perhaps had the
strongest words regarding Celsius when it suggested in September
2022 that the company’s structure resembled a Ponzi scheme.
"This shows a high level of financial mismanagement and also
suggests that, at least at some points in time, yields to existing
investors were probably being paid with the assets of new
investors," the filing from Vermont said.
About Celsius Network
Celsius Network LLC -- http://www.celsius.network/-- is a
financial services company that generates revenue through
cryptocurrency trading, lending, and borrowing, as well as by
engaging in proprietary trading.
Celsius helps over a million customers worldwide to find the path
towards financial independence through a compounding yield service
and instant low-cost loans accessible via a web and mobile app.
Celsius has a blockchain-based fee-free platform where membership
provides access to curated financial services that are not
available through traditional financial institutions.
The Celsius Wallet claims to be one of the only online crypto
wallets designed to allow members to use coins as collateral to get
a loan in dollars, and in the future, to lend their crypto to earn
interest on deposited coins (when they're lent out).
Crypto lenders such as Celsius boomed during the COVID-19 pandemic,
drawing depositors with high interest rates and easy access to
loans rarely offered by traditional banks. But the lenders'
business model came under scrutiny after a sharp sell-off in the
crypto market spurred by the collapse of major tokens terraUSD and
luna in May 2022.
New Jersey-based Celsius froze withdrawals in June 2022, citing
"extreme" market conditions, cutting off access to savings for
individual investors and sending tremors through the crypto
market.
The list of major crypto firms that have filed for bankruptcy
protection in 2022 now includes Celsius Network, Three Arrows
Capital and Voyager Digital.
Celsius Network LLC and its subsidiaries sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case
No.22-10964) on July 14, 2022. In the petition filed by CEO Alex
Mashinsky, the Debtor estimated assets and liabilities between $1
billion and $10 billion.
Kirkland & Ellis LLP is serving as legal counsel, Centerview
Partners is serving as financial advisor, and Alvarez & Marsal is
serving as restructuring advisor to Celsius. Stretto, the claims
agent, maintains the page https://cases.stretto.com/celsius
On July 27, 2022, the U.S. Trustee appointed an official committee
of unsecured creditors. On July 29, 2022, the committee voted to
retain White & Case as its counsel. The committee tapped Elementus
as blockchain forensics advisor, M3 as its financial advisor, and
Perella Weinberg Partners LP as its investment banker.
CENTRAL FLORIDA CIVIL: Wins Interim Cash Collateral Access
----------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Jacksonville Division, authorized Central Florida Civil, LLC to use
the cash collateral of Mulligan Funding, LLC and the Fundworks, LLC
on an interim basis.
As of the Petition Date, the Debtor owed $150,000 each to Mulligan
Funding, LLC and the Fundworks, LLC. The Debtor's obligation is
evidenced by a Promissory Note, Security Agreement, Financing
Statement, and Chattel Mortgage executed November 22, 2021, to
Mulligan and January 5, 2022, to Fundworks.
The Debtor is directed to pay only expenses necessary for the
operation of the business and not any pre-petition expenses,
officer salaries, professional fees, or insiders without further
Court order. If that order is entered, the necessary pre-petition
expenses, salaries, professional fees, or insider payments will not
be paid unless the Debtor is current on its ordinary course of
business expenses.
As additional adequate protection of the lender's interest and the
estate's interest in cash collateral, the lender is granted a
replacement lien to the same nature, priority, and extent that the
lender may have had immediately prior to the date that the case was
commenced nunc pro tunc to the Petition Date. Further, the lender
is granted a replacement lien and security interest on property of
the bankruptcy estate to the same extent and priority as that which
existed pre-petition on all of the cash accounts, accounts
receivable and other assets and property acquired by the Debtor's
estate or by the Debtor on or after the Petition. The replacement
lien in the Post-Petition Collateral will be deemed effective,
valid and perfected as of the Petition Date, without the necessity
of filing with any entity of any documents or instruments otherwise
required to be filed under applicable non-bankruptcy law.
The Debtor is authorized to make adequate protection payments as
follows:
a. $1,519 per month to Mulligan Funding commencing October 1,
2022, and on the first of the month thereafter or further Court
Order;
b. $1,519 per month to Fundworks commencing October 1, 2022,
and on the first of the month thereafter or further Court Order;
and
c. $519 per month to Fiji Funding, LLC commencing October 1,
2022 and on the 1st of the month thereafter or further Court
Order;
d. All other UCC-1 receivable lenders including NewCo Capital
Group, Kalamata Capital Group, Fusion Funding, Unique Capital and
Amerifii will receive no adequate protection at this time.
As additional adequate protection of the lender's interest in the
cash collateral, the Debtor will (a) maintain all necessary
insurance coverage on the lender's collateral and under no
circumstances will the Debtor allow its insurance coverage to
lapse, (b) continue to pay such monthly insurance payment in a
timely manner, and (c) within two days of the request of the
lender, the Debtor will provide to the lender's counsel a written
statement supported by evidence of the Debtor's compliance with the
foregoing.
The Debtor's authority to use the cash collateral will terminate
immediately and upon the earlier of (a) order of the Court; (b) the
conversion of the case to a Chapter 7 case or the appointment of a
Chapter 11 trustee without the consent of the lender; (c) the entry
of an Order that alters the validity or priority of the replacement
liens granted therein to the Bank; (d) the Debtor ceasing to
operate all or substantially all of its business; (e) the entry of
an order granting relief from the automatic stay that allows any
entity to proceed against any material assets of the Debtor that
constitute cash collateral; (f) the entry of an Order authorizing a
security interest under section 364(c) or 364(d) of the Bankruptcy
Code in the collateral to secure any credit obtained or debt
incurred that would be senior to or equal to the replacement lien;
or (g) the dismissal of the Chapter 11 case.
A continued hearing on the matter is set for October 17 at 10 a.m.
A copy of the order is available at https://bit.ly/3rgvs01 from
PacerMonitor.com.
About Central Florida Civil, LLC
Central Florida Civil, LLC provides a full range of services
relating to site preparation for commercial projects.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Court (Bankr. M.D. Fla. Case No. 22-01736) on August 31,
2022. In the petition signed by Chad M. Converse, manager, the
Debtor disclosed $2,469,641 in assets and $4,873,621 in
liabilities.
Judge Jason A. Burgess oversees the case.
Bryan K. Mickler, Esq., at Law Offices of Mickler & Mickler, LLP is
the Debtor's counsel.
CIV LLC: Wins Final Cash Collateral Access
------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Ohio,
Eastern Division, authorized CIV, LLC to use cash collateral on a
final basis in accordance with the budget.
The Debtor requires the use of cash collateral to meet its payroll,
pay its taxes, pay its utilities, purchase necessary supplies and
services, replace its inventory, and perform other necessary
functions in the regular course of its business, as well as to pay
fees and expenses related to the Chapter 11 case.
The Debtor represents that U.S. Bank, National Association, Funding
Metrics, LLC, Corporation Service Company and CHTD Company may
each assert an interest in the Debtor's cash collateral.
The Debtor has represented that its intended result in the
proceeding is to address its financial difficulties, maximize the
value of its assets, and to provide a substantive and procedural
mechanism for the realization of that value for the benefit of all
parties in interest.
As adequate protection, the Lien Claimants are granted liens and
security interests in the Debtor's accounts receivable, general
intangibles and other revenues generated by the operation of the
Debtor's business subsequent to the Petition Date.
The Lien Claimants are not granted a security interest in any
avoidance actions that may be pursued pursuant to the Bankruptcy
Code or other applicable law or in the proceeds from any avoidance
action.
A copy of the order is available at https://bit.ly/3dYYiii from
PacerMonitor.com.
About CIV, LLC
CIV, LLC provides vehicle hauling services on a regional and local
basis. The company operates primarily within a 12-hour drive of
Columbus, Ohio, transporting both new and used vehicles to and from
manufacturers, dealers, auction houses and consumers.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Ohio. Case No. 22-52479) on August 25,
2022. In the petition signed by Clarence Clay, president and sole
member, the Debtor disclosed up to $1 million in assets and up to
$10 million in liabilities.
Judge John E. Hoffman, Jr. oversees the case.
James A. Coutinho, Esq., at Allen Stovall Neuman & Ashton LLP is
the Debtor's counsel.
COINBASE GLOBAL: Moody's Confirms Ba3 CFR & Alters Outlook to Neg.
------------------------------------------------------------------
Moody's Investors Service confirmed Coinbase Global, Inc.'s Ba3
corporate family rating and Ba2 guaranteed senior unsecured notes'
rating. Coinbase's outlook was changed to negative from ratings
under review. This action concludes the review for downgrade that
was initiated on June 23, 2022.
"The confirmation of the ratings is supported by Coinbase's strong
liquidity position, expense management efforts and longer-dated
debt maturities" said Moody's Vice President and Senior Analyst
Fadi Abdel Massih. "The outlook is negative because of the
challenging crypto asset operating environment which continues to
be a drag on Coinbase's free cash flow generation capacity," added
Massih.
RATINGS RATIONALE
Moody's said the confirmation of Coinbase's ratings reflects the
effective management of the firm's liquidity position under the
current challenging operating environment for crypto asset
platforms. The rating action also reflects Coinbase's favorable
downward revision of its expense guidance announced in August 2022,
which resulted in full-year 2022 expense guidance for technology
and development and general administrative expenses to a range of
$4.0 billion to $4.25 billion, down from a range of $4.25 billion
to $5.25 billion previously.
Moody's said that Coinbase's June 2022 announcement of an
approximately 1,100 employee reduction in its global workforce, in
addition to other strategic expense management efforts, is helping
to preserve its liquidity position as it manages through the lower
crypto asset price and trading volume environment. However, Moody's
expects Coinbase's profitability to remain significantly
challenged, absent a substantial increase in crypto asset prices
and trading volumes.
Moody's said that as at June 30, 2022, Coinbase had $5.7 billion in
cash and cash equivalents, a healthy position relative to its $3.4
billion in long-term debt, including the $2 billion rated senior
guaranteed notes (due 2028 and 2031). Although Moody's expects the
firm's cash balances to continue to reduce in the current
environment, the firm has a rigorous approach to managing through
such stressful periods with an aim towards ensuring it has
sufficient cash preservation over the next several years.
Coinbase's $2.0 billion senior guaranteed notes' Ba2 rating is a
notch higher than Coinbase's Ba3 CFR, based on the notes' priority
ranking in Coinbase's capital structure; with the notes ranking
ahead of the firm's $1.4 billion convertible debt notes, which
don't benefit from a guarantee from the firm's operating entities.
Coinbase's negative outlook reflects Moody's expectation that the
challenging crypto asset operating environment will continue to be
a drag on the firm's cash flow generation that will slowly erode
the firm's sizeable liquidity position, absent a significant
sustained improvement in crypto asset prices and trading volumes.
The negative outlook also considers the uncertainty around the
developing regulatory landscape for crypto assets and that a
further significant sustained decline in crypto asset prices or
volumes could increase the firms operating cash deficits and put
even more pressure on expense management.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's said that Coinbase's ratings could be upgraded should there
be evidence of: 1) cost structure transformation generating
reliable profitability in varying crypto asset price and trading
volume environments; 2) achieving revenue diversification through
the development of profitable new revenue streams not tied to
trading volumes, crypto asset prices or the macroeconomic
environment, without adding significant credit risk; and 3)
increased regulatory clarity for the oversight of crypto asset
market structure should it be conducive for price stability and
improved trading volumes of traded crypto assets.
Factors that could lead to a downgrade of Coinbase's ratings
include: 1) an accelerated decline in the company's liquidity
position due to a further significant sustained decline in crypto
asset prices or volumes, not being matched by further expense
reductions; 2) a failure to return to relatively strong
profitability and operating cash flow generation despite the
ongoing expense control efforts; 3) regulatory or crypto asset
market structure changes resulting in lower trading volumes,
transaction revenue or significant regulatory penalties; or 4) a
shift in financial policy that significantly increases debt
leverage without clear visibility about subsequent de-leveraging
and with a corresponding deterioration in financial metrics
(debt/EBITDA, EBITDA/interest expense).
The following ratings were confirmed:
Issuer: Coinbase Global, Inc.
Corporate Family Rating, Confirmed at Ba3
Backed Senior Unsecured Notes, Confirmed at Ba2
Outlook Actions:
Issuer: Coinbase Global, Inc.
Outlook, Changed To Negative From Rating Under Review
The principal methodology used in these ratings was Securities
Industry Service Providers Methodology published in November 2019.
COMMUNITY ECO POWER: Seeks to Hire RSM US as Accountant
-------------------------------------------------------
Community Eco Power, LLC and its affiliates seek approval from the
U.S. Bankruptcy Court for the District of Massachusetts to employ
RSM US, LLP to provide tax advisory and tax return preparation
services.
The tax return preparation services will involve RSM preparing the
Debtors' annual federal income tax and resident state income tax
returns for the tax year ending Dec. 31, 2021.
The tax advisory services will include RSM performing a research
and development tax credit study for the tax year ending on Dec.
31, 2021.
RMS professionals will bill the Debtors at the rate of $250 per
hour for the tax services. The firm estimates that the tax
preparation services will cost between $15,000 and $23,000.
As disclosed in court filings, RMS is a "disinterested person"
within the meaning of Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Samuel Slonaker, CPA
RSM US, LLP
6 S Patterson Blvd
Dayton OH 45402
Phone: 937-298-0201
About Community Eco Power
Community Eco Power, LLC and affiliates, Community Eco Pittsfield,
LLC and Community Eco Springfield, LLC, sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Mass. Lead Case
No. 21-30234) on June 25, 2021. Richard Fish, president and chief
executive officer, signed the petitions.
At the time of the filing, Community Eco Power disclosed up to
$50,000 in assets and up to $10 million in liabilities. Affiliates,
Community Eco Pittsfield and Community Eco Springfield each
disclosed $1 million to $10 million in both assets and
liabilities.
Judge Elizabeth D. Katz oversees the cases.
D. Sam Anderson, Esq., Adam R. Prescott, Esq., and Kyle D. Smith,
Esq. at Bernstein, Shur, Sawyer and Nelson, PA, serve as the
Debtors' attorneys. RSM US, LLP is the Debtors' accountant.
CPE FEEDS: Bid to Use Cash Collateral Denied as Moot
----------------------------------------------------
The U.S. Bankruptcy Court for the Northern District of Texas,
Lubbock Division, denied as moot the motion for authority to use
cash collateral filed by CPE Feeds, Inc.
The motion is moot as the Court has orally approved the Original
Plan of Liquidation on September 21, 2022.
A copy of the order is available at https://bit.ly/3fsUjv5 from
PacerMonitor.com.
About CPE Feeds, Inc.
CPE Feeds, Inc. is a privately held company in the animal food
manufacturing business. The Debtor sought protection under Chapter
11 of the U.S. Bankruptcy Code (Bankr. N.D. Tex. Case No. 22-50022)
on March 1, 2022. In the petition signed by R. Lan Skains,
president, the Debtor disclosed up to $10 million in both assets
and liabilities.
Ryan C. Gentry, Esq., at McGowan and McGowan PC, is the Debtor's
counsel.
CROSSLINKS FAMILY: Files Emergency Bid to Use Cash Collateral
-------------------------------------------------------------
Crosslinks Family Practice, LLC asks the U.S. Bankruptcy Court for
the Northern District of Georgia, Gainesville Division, for
authority to use cash collateral on an emergency basis to continue
its operations in accordance with the proposed budget.
The Debtor operated its business successfully for many years, but
like so many other small businesses, the Debtor suffered a series
of setbacks at the hands of the pandemic, including seeking out
financing from merchant cash advance companies. The direct draws
from the MCAs left the Debtor unable to keep up with its other
financial obligations as they came due, and a lawsuit and
garnishment from one of the Debtor's creditors forced it to seek
bankruptcy protection.
Multiple MCAs assert liens on the Debtor's cash collateral. Because
the MCAs file UCC-1 financing statements through a servicer, such
as Corporation Service Company, it is impossible at this stage to
determine which MCA asserts a first position interest in Debtor's
cash collateral. The lenders that may assert an interest in the
Debtor's cash collateral are Kalamata Capital Group, LLC, Legend
Advance Funding II, LLC, Targeted Lending, CO. LLC, and the U.S.
Small Business Administration.
As adequate protection, the Debtor proposes to grant the Lenders a
replacement lien in post-petition collateral of the same kind,
extent, and priority as the liens existing pre-petition.
A copy of the motion and the Debtor's budget is available at
https://bit.ly/3RoVHvT from PacerMonitor.com.
The budget provides for total outflows, on a weekly basis, as
follows:
$40,779 for the week beginning September 26, 2022;
$5,171 for the week beginning October 3, 2022;
$39,433 for the week beginning October 10, 2022;
$6,224 for the week beginning October 17, 2022;
$35,417 for the week beginning October 24, 2022; and
$17,750 for the week beginning October 31, 2022.
About Crosslinks Family Practice, LLC
Crosslinks Family Practice, LLC is a family practice medical office
located in Tucker, Georgia. Dr. Zavier Ash is its sole shareholder
and serves as the medical director and sole physician for the
business. Dr. Ash began the Business in 2003 with his wife, Alicia
Ash, who is the COO.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ga. Case No. 22-20957) on September
23, 2022. In the petition filed by Zavier C. Ash, the Debtor
disclosed up to $50,000 in assets and up to $1 million in
liabilities.
William Rountree, Esq., at Rountree, Leitman, Klein & Geer, LLC, is
the Debtor's counsel.
DANNY R. BARTEL: Unsecureds Will Get 50% of Claims in 60 Months
---------------------------------------------------------------
Danny R. Bartel, MD, PA, Danny R. Bartel, and Brenda Sue Bartel,
filed with the U.S. Bankruptcy Court for the Northern District of
Texas a Joint Plan of Reorganization Under Subchapter V dated
September 22, 2022.
Dr. Danny Bartel M.D. and Brenda Sue Bartel are a married couple
living in Wichita Falls, Texas. Dr. Danny Bartel is a medical
doctor licensed on August 29, 1976, and a board-certified
neurologist. Dr. Bartel started his private practice in neurology
called Danny R. Bartel MD, PA.
In June of 2019, Dr. Bartel was financially doing well and began
contemplating retirement, therefore he voluntarily gave up his Drug
Enforcement Administration (DEA) license. In the Spring of 2021
Compass Bank started to become aggressive in collecting on the
judgment. On February 9, 2021, Danny Bartel MD, PA had no choice
but to file a Chapter 11 Bankruptcy, being cause number 21
40285-ELM-11.
Until he had his DEA license returned and the insurance companies
recredentialed Dr. Bartel, he could not in good faith propose a
Chapter 11 Plan in the small business case of Danny R. Bartel, MD,
PA by the deadline therefore the case was dismissed on April 14,
2022. Once the insurance companies recredentialed Dr. Bartel, his
revenue dramatically increased and now Danny R. Bartel MD, PA can
fund a Chapter 11 Plan therefore it refiled on June 26, 2022.
Class 7 consists Allowed Unsecured Claims. These Claimants shall
receive 50% of their Allowed Claims in equal monthly installments
of principal and interest over 60 months from the Effective Date.
Payments shall commence on the first day of the first month
following the Effective Date and continue on the first day of each
month thereafter. These Claims are impaired.
In the alternative, if the Plan is determined to be a "non
consensual" plan under Bankruptcy Code Section l 19l(b), all of the
Debtor's disposable income will be paid pro-rata to Class 8
Claimants on a monthly basis over 36 months. "Disposable income"
shall mean all income remaining after the Debtor's payment of its
reasonable and necessary expenses, less a reserve of $25,000 to be
built by the Debtor's retention of $10,000.00 per month for the
first two and 1/2 months following the Effective Date.
Class 9 Equity Interests shall be retained. This Class is not
Impaired.
The Debtor intends to make all payments required under the Plan
from its ordinary operating revenue.
A full-text copy of the Plan of Reorganization dated September 22,
2022, is available at https://bit.ly/3RuInX2 from PacerMonitor.com
at no charge.
Attorneys for Debtor:
Craig D. Davis, Esq.
Ronald W. Roberts, Esq.
Jeffrey W. Ermis, esq.
Davis, Ermis & Roberts, P.C.
1010 N. Center, Suite 100
Arlington, TX 76011
Tel: (972) 263-5922
Fax: (972) 262-3264
About Danny R. Bartel, M.D., P.A.
Danny R. Bartel, M.D., P.A., filed a petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Texas Case No.
22-41407) on June 24, 2022, listing as much as $50,000 in both
assets and liabilities. Danny R. Bartel, president, signed the
petition.
Judge Edward L. Morris oversees the case.
Davis, Ermis & Roberts, P.C. and Freemon Shapard & Story, CPAs
serve as the Debtor's legal counsel and accountant, respectively.
DOT DOT SMILE: Seeks to Tap Jeffrey S. Shinbrot as Legal Counsel
----------------------------------------------------------------
Dot Dot Smile, LLC and EBF Holdings, LLC seek approval from the
U.S. Bankruptcy Court for the Central District of California to
hire Jeffrey S. Shinbrot, APLC as legal counsel to represent them
in their Chapter 11 proceedings.
Jeffrey Shinbrot, Esq, will be principally responsible for this
matter and he will be paid at his hourly rate of $675. Meanwhile,
the firm's paralegals will charge $150 per hour.
The Shinbrot Firm is a "disinterested person" as defined by 11
U.S.C. Section 101(14), according to court filings.
The firm can be reached through:
Jeffrey S. Shinbrot, Esq.
Jeffrey S. Shinbrot, APLC
15620 Ventura Blvd., Suite 1200
Sherman Oaks, CA 91403
Tel: 310-659-5444
Fax: 310-878-8304
Email: jeffrey@shinbrotfirm.com
About Dot Dot Smile
Dot Dot Smile, LLC is a wholesaler of children's clothing in
Riverside, Calif.
Dot Dot Smile sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Calif. Case No. 22-13361) on Sept. 3,
2022, with $4,478,922 in assets and $5,638,742 in liabilities. CEO
Jeffrey Eugene Thompson signed the petition.
Judge Wayne E. Johnson oversees the case.
Jeffrey S. Shinbrot, APLC is the Debtor's legal counsel.
EASTERDAY RANCHES: DOJ Suggests 10-Year Sentence for Cody Easterday
-------------------------------------------------------------------
Greg Henderson of Drovers reports that federal prosecutors have
recommended Washington state cattleman Cody Easterday spend at
least 10 years and one month in prison for a fraud scheme that cost
Tyson Fresh Meats and another victim at least $244 million.
Justice Department attorneys filed a memo in the U.S. District
Court for Eastern Washington that called the theft "staggering" and
under standard sentencing guidelines recommended Easterday serve
between 121 and 151 months, or up to 12 years and seven months.
Easterday's scheme began to unravel in late 2020 when Tyson
announced it was correcting financial results with the Securities
and Exchange Commission for its beef segment for fiscal years 2017
through 2020. Tyson discovered "misappropriation of company funds"
by one of its suppliers. Court documents later revealed that
supplier to be Easterday who was charging Tyson for the costs of
buying and feeding as many as 200,000 cattle that did not exist.
Easterday pleaded guilty in the "ghost cattle" scheme in 2021, and
his sentencing has been delayed three times to allow Easterday's
legal team to sort out what the judge described as "a mess" in
terms of personal financial issues, Easterday's creditors and
Tyson.
Tyson's losses totaled $233 million and Segale Properties of
Tukwila, WA, lost $11 million. Easterday has promised to make
restitution as part of the plea agreement.
Easterday accepted responsibility for his crime and sought to raise
money for the victims by selling his family's extensive cattle and
farm holdings through bankruptcy court, according to the Justice
Department.
Sentencing is now scheduled for Oct. 4, 2022 in Yakima, WA, by U.S.
District Court Judge Stanley Bastian.
By accepting responsibility, Easterday's sentencing range was
reduced by approximately four to six years, according to the
Justice Department.
About Easterday Ranches and Easterday Farms
Easterday Ranches, Inc., is a privately held company in the cattle
ranching and farming business.
Easterday Ranches sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D. Wash. Case No. 21-00141) on Feb. 1,
2021. Its affiliate, Easterday Farms, a Washington general
partnership, filed a Chapter 11 bankruptcy petition (Bankr. E.D.
Wash. Case No. 21-00176) on Feb. 8, 2021. The cases are jointly
administered under Case No. 21-00141.
At the time of the filing, the Debtors disclosed assets of between
$100 million and $500 million and liabilities of the same range.
Judge Whitman L. Holt oversees the cases.
The Debtors tapped Pachulski Stang Ziehl & Jones LLP as their lead
bankruptcy counsel, Bush Kornfeld LLP as local counsel, and Davis
Wright Tremaine LLP as special counsel. T. Scott Avila and Peter
Richter of Paladin Management Group serve as restructuring
officers.
On Feb. 16, 2021, the Office of the United States Trustee for the
Eastern District of Washington appointed a Ranches Official
Committee of Unsecured Creditors. The Ranches Committee initially
retained Dentons US LLP as its counsel and B. Riley Advisors as its
financial advisor. The Ranches Committee subsequently retained
Cooley LLP as its counsel, replacing Dentons US LLP.
On Feb. 22, 2021, the U.S. Trustee appointed a Farms Official
Committee of Unsecured Creditors. The Farms Committee retained
Buchalter, a Professional Corporation as its counsel and Dundon
Advisers LLC as its financial advisor.
EL RANCHO COLORADO: Files for Chapter 11 Bankruptcy
---------------------------------------------------
El Rancho Colorado Restaurant LLC filed for chapter 11 protection
in the District of Colorado.
The Debtor is a Colorado limited liability company that owns
improved real property located in Jefferson County, Colorado. The
Debtor is owned and operated by Paul Vincent, the manager, who also
has an interest in El Rancho Brewing Company, Inc., a company that
operated a restaurant and taproom out of the Debtor's property.
El Rancho Colorado Restaurant LLC estimates $1 million to $10
million in debt to 1 and 49 creditors. The petition states that
funds will be available to unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Nov. 1, 2022, at 9:00 AM at Telephonic Chapter 11.
About El Rancho Colorado Restaurant
El Rancho Colorado Restaurant LLC is a Colorado limited liability
company that owns improved real property located in Jefferson
County, Colorado.
On Sept. 22, 2022 El Rancho Colorado Restaurant LLC filed for
chapter 11 protection (Bankr. D. Colo. Case No. 22-13649). In the
petition filed by Paul Vincent, as manager, the Debtor reported
assets between $1 million and $10 million and liabilities of the
same range.
The Debtor is represented by Keri L. Riley of Kutner Brinen Dickey
Riley, P.C.
ENDO INT'L: Cooley, Akin Gump Represent Opioid Claimants
--------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
the law firms of Cooley LLP and Akin Gump Strauss Hauer & Feld LLP
submitted a verified statement to disclose that they are
representing the Official Committee of Opioid Claimants in the
Chapter 11 cases of Endo International PLC, et al.
The Debtors are a specialty pharmaceutical company that has
developed, manufactured and sold branded and generic products to
customers in a wide range of medical fields since 1997. The
Debtors' products have included branded opioid products such as
Opana and Opana ER and generic opioid products, including morphine
sulfate, oxycodone, hydrocodone and oxycodone hydrochloride
products. The Debtors have been named as defendants in over 3,500
lawsuits seeking to hold them liable for their marketing and sale
of opioid products, including the Opana Medications. The Debtors
removed Opana® ER from the market at the request of the United
States Food and Drug Administration in 2017, and the Debtors have
not sold any Opana Medications since June 2019. Certain of the
Debtors, however, continue to manufacture and sell generic opioid
medication.
On August 17, 2022, the Debtors filed a voluntary petition for
relief under chapter 11 of the Bankruptcy Code with the Court. The
Debtors are authorized to continue to operate their businesses and
manage their properties as debtors in possession pursuant to
Bankruptcy Code sections 1107(a) and 1108. No request has been made
for the appointment of a trustee or an examiner in the Chapter 11
Cases.
On September 2, 2022, the Office of the United States Trustee for
Region 2 appointed seven of the Debtors' opioid claimants to serve
as members of the OCC [ECF No. 163]. The OCC currently comprises
the following entities and persons: (i) Robert Asbury as Guardian
Ad Litem for certain NAS Infants (as defined below); (ii) Sabrina
Barry; (iii) Blue Cross and Blue Shield Association; (iv) Erie
County Medical Center Corporation; (v) Sean Higginbotham; (vi) Alan
MacDonald; and (vii) Michael Masiowski, M.D. Each Member of the OCC
takes seriously the OCC's role as a fiduciary for the interests of
opioid claimants seeking compensation for opioid-related losses and
injuries caused by the Debtors.
The OCC Members include the following claimants asserting claims
arising from the Debtors' actions:
* Robert Asbury serves as a Guardian Ad Litem representing
two children afflicted with Neonatal Abstinence Syndrome
who are plaintiffs in a Tennessee lawsuit seeking damages
under Tennessee's Drug Dealer Liability Act from certain of
the Debtors. Infants who are exposed to opioids in utero
may be born dependent on opioids and diagnosed with NAS.
NAS Infants typically require extended stays in Neonatal
Intensive Care Units where they are inconsolable, shake and
cry uncontrollably and suffer a myriad of physical issues.
During hospital stays, they often must be weaned from their
opioid dependence with controlled doses of morphine. During
childhood, these children typically suffer from a
combination of significant learning disabilities, attention
deficit issues, oppositional defiance issues and other
manifestations of their NAS diagnosis. Longer-term,
children diagnosed with NAS are likely to continue to
suffer from these same impairments throughout their lives,
and face a heightened risk of substance addiction.
* Sabrina Barry is a mother and caregiver of two children
exposed to opioids in utero. In 2011, Ms. Barry suffered a
car accident. When she was admitted to the hospital for
treatment for her injuries, she learned she was pregnant.
Without receiving information from her doctors regarding
the risks, Ms. Barry was prescribed opioids, including
Percocet, throughout her entire pregnancy and for a year
and a half after she gave birth to her firstborn son. Ms.
Barry became opioid dependent and eventually entered
medication-assisted treatment. As a result of his opioid
exposure in utero, Ms. Barry's eldest son has been
diagnosed with autism, speech delays and sleep disorders.
Her youngest son, who was also exposed to opioids in utero,
was born in 2016 and was treated with morphine for
withdrawal symptoms after birth. He continues to experience
speech delays, allergies and asthma. Ms. Barry's
unliquidated claims are based on theories of public
nuisance, negligence, breach of implied warranty, breach of
implied warranty for fitness of a particular purpose,
fraudulent misrepresentation, fraudulent concealment,
negligent misrepresentation, strict products liability and
products liability. Ms. Barry's unliquidated claims
comprise personal injury and punitive damages.
* BCBSA is a national association of 34 independent,
community-based Blue Cross and Blue Shield companies. The
BCBS Companies provide healthcare coverage to one-third of
all Americans, including approximately 5.5 million federal
employees and annuitants who are members of a health plan
established under the Federal Employee Health Benefits Act
that BCBSA administers. BCBSA's claims arise from payments
of excessive amounts for prescription medications used by
members of private Medicare Part C and Medicaid plans,
Federal Employee Health Benefits Act plans and coverage and
administrative services for fully insured and self-funded
employer health plans under ERISA. BCBSA's claims also
arise from the downstream effects of these opioid
prescriptions, including paying for treatment- emergency
treatment and protracted rehabilitation- of current and
former members who have suffered the effects of improper
opioid prescriptions.
* ECMCC is one of Western New York's leading hospitals,
serving Western New York and its surrounding areas. ECMCC
specializes in trauma care, transplantation and kidney
care, oncology and behavioral health, including the care
and treatment of those afflicted with opioid addiction.
ECMCC has been at the forefront of addressing the opioid
crisis in Western New York, and has borne the brunt of
uncompensated and undercompensated care for harm inflicted
by the Debtors. Not only is ECMCC a leader in the treatment
and care of those afflicted with opioid addiction, but it
also is at the cutting-edge of researching, strategizing
and developing new protocols and remedies to fight the
opioid crisis to ease the burdens of those affected most.
Before the Debtors commenced the Chapter 11 Cases, ECMCC
asserted claims for these harms in litigation under New
York's Consumer Protection from Deceptive Acts and
Practices statute, as well as under theories of negligence,
nuisance, unjust enrichment, fraud and deceit, fraudulent
concealment, civil conspiracy and concert of action.
ECMCC's damages include: (i) the cost of providing health
care to patients with opioid-related conditions; and (ii)
the cost of operational expenses incurred to respond to
conditions created by the opioid epidemic.
* Sean Higginbotham and his late wife, Lisa, met in Fort
Worth, Texas and moved to rural Oklahoma to raise their
growing family. However, a hit-and- run accident left Lisa
with severe back problems and intense chronic pain. A
number of surgeries and years of use of prescription
opioids-including opioids manufactured by certain of the
Debtors-did little to solve these issues.By 2012, Lisa had
a noticeable change in her personality, having become
increasingly reserved and refusing to leave her home.
Lisa's opioid dependence symptoms worsened until her
children found her deceased due to an opioid overdose in
2018. Mr. Higginbotham's claims are unliquidated and, when
filed, will include, among others, a claim for wrongful
death and a survival action.
* Alan MacDonald was prescribed opioids—including oxycodone
manufactured by certain of the Debtors—to treat his pain
after suffering an injury. Soon thereafter, his growing
dependence on opioids affected his life and his family.
Mr. MacDonald lost his job, suffered a divorce from his
wife and lost custody of his two daughters. He subsequently
pursued rehabilitation seeking the help he desperately
needed, however, he needed more time than he had to recover
from his dependence on opioids. After struggling with
recovery for many years, Mr. MacDonald now attends and
hosts AA meetings to help others who have also suffered
from opioid addiction. Mr. MacDonald's claims are
unliquidated and, when filed, will include a claim for
personal injury damages.
* Michael Masiowski, M.D. is an independent emergency room
physician who has provided emergency opioid treatment
services to patients who were uninsured, indigent or
otherwise eligible for services through programs such as
Medicaid. Dr. Masiowski is the putative class
representative for a class of emergency room physicians who
have been forced to provide an inordinate amount of
emergency room services related to the "opioid epidemic,"
either for no compensation or for compensation
substantially below market rates. Other damages relate to
unreimbursed expenses incurred. Dr. Masiowski's putative
class action against certain of the Debtors, along with
other opioid manufacturers, seeks damages for these harms
based on RICO violations, various forms of negligence and
fraud.
As of Sept. 27, 2022, each OCC member and their disclosable
economic interests are:
Robert Asbury
567 Main Street
Jacksboro, TN 37757
* Unliquidated unsecured claim on the basis of, among other
things, personal injury of each NAS victim.
Sabrina Barry
16 Bowstring Way
Marlborough, MA 01752
* Unliquidated unsecured claim on the basis of, among other
things, personal injury of herself and her two children, who
suffer the long term effects of NAS.
Blue Cross and Blue Shield Association
1310 G Street NW
Washington, D.C. 20005
* Unliquidated unsecured claim on the basis of, among other
things, covering treatment for opioid use disorder.
Erie County Medical Center Corporation
462 Grider Street
Buffalo, NY 14215
* Unliquidated unsecured claims.
Sean Higginbotham
2466 E 2030 Rd.
Hugo, OK 74743
* Unliquidated unsecured claim on the basis of, among other
things, wrongful death.
Alan MacDonald
53 Taunton Ave.
Rockland, MA 02370
* Unliquidated unsecured claim on the basis of, among other
things, personal injury, including addiction, lost wages and
emotional injury.
Michael Masiowski, M.D.
626 NE 1st Street
Gainesville, FL 32601
* Unliquidated unsecured claim on the basis of, among other
things, RICO violations, various forms of negligence and fraud.
The OCC reserves the right to amend or supplement this Verified
Statement in accordance with the requirements set forth in
Bankruptcy Rule 2019.
Proposed Lead Counsel to the Official Committee of Opioid Claimants
can be reached at:
COOLEY LLP
Cullen D. Speckhart, Esq.
Michael Klein, Esq.
Evan Lazerowitz, Esq.
55 Hudson Yards
New York, NY 10001
Telephone: (212) 479-6000
Facsimile: (212) 479-6275
E-mail: cspeckhart@cooley.com
mklein@cooley.com
elazerowitz@cooley.com
Proposed Special Counsel to the Official Committee of Opioid
Claimants can be reached at:
AKIN GUMP STRAUSS HAUER & FELD LLP
Arik Preis, Esq.
Mitchell P. Hurley, Esq.
Theodore James Salwen, Esq.
One Bryant Park
New York, NY 10036-6745
Telephone: (212) 872-1000
Facsimile: (212) 872-1002
E-mail: apreis@akingump.com
mhurley@akingump.com
jsalwen@akingump.com
- and -
Kate Doorley, Esq.
2001 K Street NW
Washington, DC 20006
Telephone: (202) 887-4000
Facsimile: (202) 887-4288
E-mail: kdoorley@akingump.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/3BLYoSg
About Endo International
Endo International plc (NASDAQ: ENDP) is a specialty pharmaceutical
company committed to helping everyone we serve live their best life
through the delivery of quality, life-enhancing therapies. Its
decades of proven success come from passionate team members around
the globe collaborating to bring the best treatments forward.
Together, we boldly transform insights into treatments benefiting
those who need them, when they need them. On the Web:
http://www.endo.com/
On August 16, 2022, Endo International plc and certain of its
subsidiaries initiated voluntary prearranged Chapter 11 proceedings
(Bankr. S.D.N.Y. Lead Case No. 22-22549). The Company's cases are
pending before the Honorable James L. Garrity, Jr. The Company has
put up a Web site dedicated to its restructuring:
http://www.endotomorrow.com/
The Debtors tapped Skadden, Arps, Slate, Meagher & Flom LLP as
legal counsel; PJT Partners LP as investment banker; and Alvarez &
Marsal as financial advisor. Kroll is the claims agent.
Roger Frankel, the legal representative for future claimants in
these Chapter 11 cases, tapped Frankel Wyron LLP and Young Conaway
Stargatt & Taylor, LLP as counsel and Ducera Partners LLC as
investment banker.
EVERGREEN SITE: Commences Subchapter V Case
-------------------------------------------
Evergreen Site Holdings Inc. filed for bankruptcy protection in the
Southern District of Ohio without stating a reason. The Debtor
elected on its voluntary petition to proceed under Subchapter V of
chapter 11 of the Bankruptcy Code.
Evergreen Site Holdings estimated debt of $1 million to $10 million
to 1 to 49 creditors. The petition states funds will be available
to unsecured creditors.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Oct. 19, 2022, at 10:00 AM at Columbus 341.
About Evergreen Site Holdings Inc.
Evergreen Site Holdings filed a petition for relief under
Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. S.D. Ohio
Case No. 22-52799) on Sept. 22, 2022. In the petition filed by
Jack K. Beatley, as president, the Debtor reported assets and
liabilities between $1 million and $10 million.
Matthew T. Schaeffer has been appointed as Subchapter V trustee.
The Debtor is represented by Denis E Blasius.
EXWORKS CAPITAL: Exclusivity Period Extended to Oct. 10
-------------------------------------------------------
ExWorks Capital, LLC obtained a court order extending its exclusive
right to file a Chapter 11 plan and solicit acceptances from
creditors to Oct. 10 and Dec. 9, respectively.
The ruling by Judge Brendan Shannon of the U.S. Bankruptcy Court
for the District of Delaware allows the company to file an amended
plan without the threat of a competing plan from creditors.
ExWorks on June 13 filed a small business plan of reorganization,
which was within the 90-day statutory deadline imposed on
Subchapter V debtors. On Aug. 8, the court issued an order
redesignating the company's case as an ordinary Chapter 11 case.
ExWorks said it needs to amend its plan following the court order
and intends to move toward confirmation quickly following a status
conference with the court.
About Exworks Capital
ExWorks Capital, LLC is an Oak Brook, Ill.-based company engaged in
financial investment activities.
ExWorks filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Del. Case No. 22-10213) on March 14,
2022, with up to $500,000 in assets and up to $10 million in
liabilities. On Aug. 8, the court entered an order redesignating
the Debtor's case as an ordinary Chapter 11 case.
Judge Brendan Linehan Shannon oversees the case.
The Debtor tapped Baker & Hostetler, LLP as bankruptcy counsel, and
King & Spalding, LLP as special counsel.
FOX SUBACUTE: Wins Cash Collateral Access Thru Dec 17
-----------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Pennsylvania
authorized Fox Subacute at Mechanicsburg, LLC and its affiliated
debtors to use cash collateral on an interim basis through and
including the earlier of December 17, 2022, or the occurrence of an
event of default.
The Debtors will use cash collateral only:
i. for the purposes specified in the Budget;
ii. to pay United States Trustee's fees;
iii. to pay contingent fees of Weltman, Weinberg & Reis Co.,
LPA, the Debtor's special counsel; and
iv. to pay professional fees and reimbursement for expenses
allowed by the Court that the Bank and Sabra consent to being paid
from cash collateral or for which the Bank's and/or Sabra's
collateral is surcharged pursuant to 11 U.S.C. section 506(c).
On or before the fifth day of each month during the 19th interim
period, the Debtors will remit to PeoplesBank, A Codorus Valley
Company, the amount of all accrued and unpaid interest under the
Note, and $50,000, which amount will be applied to the principal
balance outstanding under the Note. As additional adequate
protection, Mechanicsburg will remit to the Bank for application to
the principal balance outstanding under the Note: (a) upon entry of
the Order, a payment in the amount of $600,000; and (b) on November
5, 2022 if the "Facility Use Period," has not ended, a payment in
the amount of $100,000. Additionally, subject only to satisfaction
of post-petition administrative expense claims provided for in the
Budget and not paid during the 19th Interim Period other than the
deferred rent claim of Sabra, the Bank may apply any funds on
deposit in Warrington's operating account and concentration account
at the expiration of the 19th Interim Period to the principal
balance outstanding under the Note.
On or before the fifth day of each month during the 19th Interim
Period, Clara Burke will pay $168,394 to Sabra as payment of the
contractual base rent due from Warrington and Clara Burke pursuant
to the terms of the Sabra Lease. Warrington and Clara Burke do not
concede that the base rent amounts represent fair market rents for
the respective facilities and reserve all rights as to whether such
base rent amounts constitute market rents.
The Debtors will maintain Eligible Accounts Receivable and cash on
deposit in concentration accounts maintained with the Bank such
that the sum of 70% of the Eligible Accounts Receivable plus 90% of
cash on deposit in such accounts is at all times equal to or
greater than 1.8 times the principal balance outstanding under the
Note and the Loan Agreement.
On or before the fifth day of each month during the 19th interim
period, the Debtors will remit to the Bank a $500 fee to compensate
the Bank for the personnel time required to monitor the Debtors'
compliance with the interim cash collateral order.
The Bank is granted a replacement lien on the Debtors'
post-petition assets, and Sabra will have a replacement lien on the
post-petition assets of Clara Burke and Warrington with the same
respective priorities as their pre-petition lien to the same extent
that the Bank and Sabra would have had perfected liens on such
assets absent the filing of the petition.
Moreover, the Bank and Sabra are each granted a claim against the
Debtors, which claim have: (a) the same priority as United States
Trustee's fees and professional fees and reimbursement for expenses
allowed by the Court that are authorized to be paid from cash
collateral; and (b) priority over any other administrative expenses
of any kind including, the administrative expenses described in
Sections 503(b) and 507(b) of the Bankruptcy Code.
These events constitute an "Event of Default:
1. The failure of the Debtors to maintain the Required
Balance;
2. Use by any Debtor of cash collateral for purposes other
than those specified in the Approved Budget or to pay the Weltman
Fees, without the Bank's and Sabra's written consent;
3. Use by any Debtor of cash collateral for any purpose (other
than payment of the Weltman Fees) in an amount in excess of the
amount specified in the Approved Budget subject to the Acceptable
Variance, without the Bank's and Sabra's written consent;
4. The failure of the Debtors to make the payments and/or
escrow deposits to the Bank and/or Sabra provided for in the order
when and as due;
5. The failure of any Debtor to pay any obligation arising on
or after the Petition Date under any unexpired lease of
nonresidential property, including without limitation, the Sabra
lease, by the later of: (a) the date payment of such obligation is
due under the applicable lease; or (b) such date, if any, as may be
set by the Court pursuant to 11 U.S.C. section 365(d)(3); or
6. The violation by any Debtor of any other term or condition
of the Order.
The final hearing on the cash collateral request is continued to
December 13, 2022 at 9:30 a.m.
A copy of the order and the Debtors' budgets for October 2022 is
available at https://bit.ly/3CkxNNZ from PacerMonitor.com free of
charge.
The budget for Fox Subacute at Warrington provided for $139,623 in
total cash out.
The budget for Fox Subacute at Clara Burke provided for $1,389,665
in total cash out.
The budget for Fox Subacute at South Philadelphia provided for
$1,197,296 in total cash out.
The budget for Fox Subacute at Mechanicsbudg provided for
$1,279,839 in total cash out.
About Fox Subacute at Mechanicsburg, LLC
Fox Subacute at Mechanicsburg, LLC is a skilled nursing facility in
Pennsylvania that specializes in pulmonary, neurological, and
rehabilitative care for patients with degenerative neurological and
neuromuscular disease; and pulmonary care and ventilator
requirements with an emphasis on vent weaning. Its facilities are
located in Plymouth Meeting, Warrington, Mechanicsburg and
Philadelphia, Pa., and are licensed by the PA Department of
Health.
On Nov. 1, 2019, Fox Subacute at Mechanicsburg and its affiliates
sought Chapter 11 protection (Bankr. M.D. Pa. Lead Case No.
19-04714). Fox Subacute at Mechanicsburg was estimated to have $1
million to $10 million in assets and liabilities as of the
bankruptcy filing.
Judge Henry W. Van Eck oversees the cases.
The Debtors tapped Cunningham, Chernicoff & Warshawsky, P.C. as
their legal counsel, Kennedy P.C. as special counsel, Isdaner &
Company, LLC as accountant, and Three Twenty-One Capital Partners,
LLC as investment banker.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on Dec. 11, 2019. The committee is represented
by Flaster/Greenberg P.C.
FREE SPEECH: Alex Jones Renews "Deep State" Claim in Trial
----------------------------------------------------------
Laurel Calkins of Bloomberg News reports that combative conspiracy
theorist Alex Jones doubled down on his claim that defamation
lawsuits filed by the families of 26 children and educators gunned
down at Sandy Hook Elementary School are part of a liberal plot to
destroy him.
"I think this is a Deep State situation," Jones told jurors
Thursday, September 22, 2022, during the second week of a civil
trial in Connecticut. When asked if his credibility is the most
important thing to him, the Infowars host replied: "No, crushing
the globalists."
Jurors are hearing testimony to determine how much the Internet
host must pay in damages for defaming eight families and an FBI
agent who responded to the scene of the 2012 school shooting by
repeatedly calling the massacre a hoax. Jones already was found
liable for defamation against the victims, who say his false claims
encouraged his fans to harass and pursue them, turning their lives
into living nightmares.
Connecticut State Judge Barbara Bellis, who ruled Jones was liable
in a separate non-jury proceeding, is overseeing the case in New
Haven, about 25 miles from Sandy Hook. Bellis and judges in two
similar Sandy Hook lawsuits ruled against Jones for failing to turn
over financial records.
Jones has repeatedly insisted his First Amendment free speech
rights protect his statements, even if they were false. He claims
he should be able to speak freely on topics of national importance
like any other journalist. Having already been found liable, Jones
isn't legally allowed to make that argument to jurors in any of
these trials, which are strictly to determine damages.
Texas Case
In the first of the three Sandy Hook defamation trials last month,
a jury in Austin, Texas, ordered Jones to pay almost $50 million to
the parents of one of the slain first graders.
On the stand Thursday, Jones admitted he's blasted Bellis as a
"tyrant" and mocked the Connecticut proceeding as a "kangaroo
court." He said his Infowars.com staff has added a "kangaroocourt"
page so fans can follow the trial.
After a heated exchange with one of the families' lawyers, Jones
proclaimed loudly, "I'm done saying I'm sorry. I legitimately
thought it might've been staged. I've apologized to the parents.
I'm not apologizing to you."
The judge then interrupted Jones, saying, "You're in a court of
law. You have to follow the rules. There is media in the room, but
this is not a press conference. This is clearly not your show."
After sending the jury home for the day, Bellis warned Jones and
the lawyers on both sides that she'd hold in contempt anyone who
"steps out of line" or engages in "outbursts."
Outside the courthouse on Wednesday, September 21, 2022 Jones
called the trial a "travesty of justice, and this judge is a
tyrant." He added that he was merely questioning whether government
agents staged the school shooting -- with the help of "crisis
actors" portraying grieving parents -- as part of a liberal plot to
confiscate citizens' guns.
"There have been a lot of staged events in history, like WMDs in
Iraq, and I question every major event that we see," Jones told
reporters Wednesday, September 21, 2022.
Jurors have heard family members of the murdered children describe
how Jones’s fans stalked them in person and online, threatening
violence and denying their loved ones ever existed. The jury was
also shown video clips of Jones telling millions of viewers the
massacre never happened and was a "false flag" operation by the
government.
The Law & Crime Network, which is livestreaming the Connecticut
trial, disabled its comments section Wednesday, September 21, 2022,
after Jones's fans swarmed the webcast with violent threats to the
families.
The case is Lafferty v. Jones, 22-05019, US Bankruptcy Court,
District of Connecticut (Bridgeport).
About Free Speech Systems
Free Speech Systems LLC is a broadcast media production and
distribution company that provides broadcasting aural programs by
radio to the public. Free Speech Systems is a family-run business
founded by Alex Jones.
FSS is presently engaged in the business of producing and
syndicating Jones' radio and video talk shows and selling products
targeted to Jones' loyal fan base via the Internet. Today, FSS
produces Alex Jones' syndicated news/talk show (The Alex Jones
Show) from Austin, Texas, which airs via the Genesis Communications
Network on over 100 radio stations across the United States and via
the internet through websites including Infowars.com.
Due to the content of Alex Jones' shows, Jones and FSS have faced
an all-out ban of Infowars from mainstream online spaces. Shunning
from financial institutions and banning Jones and FSS from major
tech companies began in 2018.
Conspiracy theorist Alex Jones has been sued by victims' family
members over Jones' lies that the 2012 Sandy Hook Elementary School
shooting was a hoax.
Jones' InfoW LLC and affiliates, IWHealth, LLC and Prison Planet
TV, LLC, filed petitions under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April
18, 2022.
The Debtors agreed to the dismissal of the Chapter 11 cases in June
2022 after the Sandy Hook victim families dismissed the three
bankrupt companies from their lawsuits.
Free Speech Systems filed a voluntary petition for relief under
Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex.
Case No. 22-60043) on July 29, 2022. In the petition filed by W.
Marc Schwartz, as chief restructuring officer, the Debtor reported
assets and liabilities between $50 million and $100 million.
Melissa A Haselden has been appointed as Subchapter V trustee.
Raymond William Battaglia, of Law Offices of Ray Battaglia, PLLC,
is the Debtor's counsel.
GIRARDI & KEESE: Erika Earrings Auctioneer Approved
---------------------------------------------------
Elissa D. Miller, Chapter 7 Trustee for Girardi Keese, won approval
Sept. 27, 2022, of her bid to retain ThreeSixty Asset Advisors, LLC
and John Moran Auctioneers, Inc. as her auctioneer to sell personal
property of the estate consisting of the Erika Jayne Girardi
Diamond Stud Earrings (approx. 7 carat weight each) (the "Erika
Earrings") as well as miscellaneous other jewelry (the "Friend's
Jewelry").
The Trustee recovered the Earrings from Erika Jayne Girardi, the
former spouse of Tom Girardi, after it was ascertained that the
Earrings had been purchased by a check written on the Debtor's
"Rezulin" mass tort litigation client trust account and had been
booked as a "cost".
In August, a former "friend" of TVG turned over to the Trustee
jewelry which she and the Trustee believed were purchased by the
Debtor. The pieces are a small Tiffany heart shaped white gold and
pave diamond necklace, a small Cartier gold and pave diamond
necklace, a Bulgari pearl and diamond necklace and diamond stud
earrings approximately 1.75 carats each (the "Friends' Jewelry").
The Trustee believes that the auction value of the Friend's Jewelry
is between $10,000 and $15,000.
The Sale will be conducted concurrently as an Internet Auction and
Live Auction on the best date to ensure maximum participation and
so not to conflict with another jewelry auction between December 5,
2022 and December 16, 2022, and to jewelry which she and the
Trustee believed were purchased by the Debtor.
About Girardi & Keese
Girardi and Keese or Girardi & Keese was a Los Angeles-based law
firm founded in 1965 by lawyers Thomas Girardi and Robert Keese. It
served clients in California in a variety of legal areas. It was
known for representing plaintiffs against major corporations.
An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No.
20-21022) was filed in December 2020 against GIRARDI KEESE by
alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian,
Erika Saldana, Virginia Antonio, and Kimberly Archie.
The petitioners' attorneys:
Andrew Goodman
Goodman Law Offices, Apc
Tel: 818-802-5044
E-mail: agoodman@andyglaw.com
Elissa D. Miller, a member of the firm SulmeyerKupetz, has been
appointed as Chapter 7 trustee for GIRARDI KEESE. The Chapter 7
trustee can be reached at:
Elissa D. Miller
333 South Grand Ave., Suite 3400
Los Angeles, California 90071-1406
Telephone: (213) 626-2311
Facsimile: (213) 629-4520
E-mail: emiller@sulmeyerlaw.com
An involuntary Chapter 7 petition was also filed against Thomas
Vincent Girardi (Case No. 20-21020) on Dec. 18, 2020. The Chapter 7
trustee can be reached at:
Jason M. Rund
Email: trustee@srlawyers.com
840 Apollo Street, Suite 351
El Segundo, CA 90245
Telephone: (310) 640-1200
GPMI CO: Exclusivity Period Extended to Oct. 14
-----------------------------------------------
GPMI Co. obtained an order from the U.S. Bankruptcy Court for the
District of Arizona extending its exclusive right to file a Chapter
11 plan to Oct. 14 and solicit votes in favor of the plan to Dec.
14.
The company will use the extension to finalize the terms of its
reorganization plan and address any issues with its lender and
other key constituents.
About GPMI Co.
GPMI Company is engaged in developing new concepts, innovating
products, program development, and marketing. GPMI is an
Arizona-based company established in 1989, with production
facilities across the United States.
GPMI filed its voluntary petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. D. Ariz. Case No. 22-00150) on Jan. 10,
2022, listing as much as $50 million in both assets and
liabilities. Yarron Bendor, president, signed the petition.
Judge Eddward P. Ballinger Jr. oversees the case.
The Debtor tapped Engelman Berger, PC, led by Steven N. Berger,
Esq., as legal counsel; Dickinson Wright PLLC and Titus Brueckner &
Levine, PLC as special counsel; and MCA Financial Group, Ltd. as
financial consultant.
HARDIN TRUCKING: Seeks to Hire Lyle, Walker & Co as Accountant
--------------------------------------------------------------
Hardin Trucking Co., Inc. seeks approval from the U.S. Bankruptcy
Court for the Northern District of Mississippi to hire Lyle, Walker
& Co., P.A. as its accountant.
The accountant will render these services:
a. assume primary responsibility for the filing of necessary
tax returns;
b. prepare financial statements in accordance with the tax
basis of accounting and apply accounting and financial reporting
expertise to assist the Debtor in the presentation of financial
statements; and
c. provide other general accounting services.
The firm will charge $3,000 per month for monthly compilation and
bookkeeping services. The fees for monthly and quarterly payroll
filling services will be $500 per month.
As disclosed in court filings, Lyle, Walker & Co. is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Cindy Hollingsworth, CPA
Lyle, Walker & Co., P.A.
1020 Northpark Dr
Ridgeland, MS 39157
Telephone: (601) 981-0207
Fax: (601) 981-0311
Email: chollingsworth@lylewalker.com
About Hardin Trucking Co.
Hardin Trucking Co., Inc. is a full-service trucking company
specializing in the transport of raw wood products. The company is
based in Bruce, Miss.
Hardin Trucking Co. filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Miss. Case No.
22-11453) on June 24, 2022, with between $1 million and $10 million
in assets and between $10 million and $50 million in liabilities.
Judge Jason D. Woodard oversees the case.
The Debtor tapped Craig M. Geno, Esq., at the Law Offices of Craig
M. Geno, PLLC as counsel, and Lyle, Walker & Co., P.A. as
accountant.
David Asbach, Acting U.S. Trustee for Region 5, appointed an
official committee to represent unsecured creditors in the Debtor's
Chapter 11 case.
INFOW LLC: Court Orders New Officials to Oversee Bankruptcy Case
----------------------------------------------------------------
Elizabeth Williamson of The New York Times reports that the
bankruptcy court orders new officials in bankruptcy case.
A federal bankruptcy judge in Houston ordered new personnel to
oversee the bankruptcy of Alex Jones's Infowars late on Tuesday,
citing an ongoing lack of transparency, including over Mr. Jones's
lavish personal spending.
Judge Christopher Lopez dismissed Mr. Jones's attorney and chief
restructuring officer in the bankruptcy of Free Speech Systems,
Infowars' parent company, and expanded the duties of a Department
of Justice-appointed trustee already monitoring the case. The judge
authorized the trustee to hire additional legal and other help,
specifying that any new hires must have "no connection to any of
these cases," he said, citing a need to investigate "insider
relationships."
"There has to be greater transparency in this case," Judge Lopez
said during the hearing on Tuesday, pointing to concerns with
spending and other disclosures on the part of the company, which is
run by Mr. Jones. "Without transparency, people lose faith in the
process," he added, referring to the federal bankruptcy system.
The lawyer and restructuring officer were together attempting to
reorganize the company as part of the bankruptcy. In dismissing
them, the judge did not fault their work, but rather cited a "lack
of candor”"on the part of the company, whose moves are dictated
by Mr. Jones.
Mr. Jones put Free Speech Systems into bankruptcy in late July and
has said he owes $54 million to PQPR, an entity owned and operated
directly and indirectly by Mr. Jones and his parents. He filed the
bankruptcy partly in response to ongoing litigation against him by
the family members of 10 Sandy Hook victims, who say the bankruptcy
is a gambit to prevent them from collecting what promise to be
heavy financial damages in the cases.
Understand the Cases Against Alex Jones
A united front. Alex Jones, a far-right conspiracy theorist, is the
focus of a long-running legal battle waged by families of victims
of a mass shooting at Sandy Hook Elementary School in Newtown,
Conn., in 2012. Here is what to know:
Pushing misinformation. Mr. Jones used his Infowars media company
to spread lies about Sandy Hook, claiming that the attack in 2012,
in which 20 first graders and six educators were killed, was a
hoax. The families of the victims say Mr. Jones's lies have added
to their devastation and his followers have harassed them,
threatening their safety.
Defamation lawsuits. The families of 10 Sandy Hook victims sued Mr.
Jones in four separate lawsuits. The cases never made it to a jury;
Mr. Jones was found liable by default in all of them because he
refused to turn over documents, including financial records,
ordered by the courts over four years of litigation.
Mr. Jones's line of defense. The Infowars host has claimed that his
right to free speech protected him, even though the outcome of the
cases was due to the fact that he failed to provide the necessary
documents and testify.
Three new trials. A trial in Austin, Texas this July was the first
of three that will determine how much Mr. Jones must pay the
families of the Sandy Hook victims. The other two are scheduled for
September, but are on hold after Mr. Jones put the Infowars parent
company, Free Speech Systems, into Chapter 11 bankruptcy last week,
halting all pending litigation.
Compensatory and punitive damages. On Aug. 4, 2022, a jury in the
Texas trial awarded the parents of one of the children killed in
the mass shooting more than $4 million in compensatory damages,
which are based on proven harm, loss or injury. A day later, jurors
decided Mr. Jones must pay the parents $45.2 million in punitive
damages, which aim to punish especially harmful behavior and tend
to be granted at the court’s discretion.
The families filed four separate defamation lawsuits against Mr.
Jones after he spent years spreading lies that the Dec. 14, 2012,
shooting that killed 20 first graders and six educators at Sandy
Hook Elementary School in Newtown, Conn., was a government pretext
for gun control and that their relatives were actors in the plot.
People who believed Mr. Jones’s false claims have tormented the
families online, confronted them on the street and threatened their
lives.
Mr. Jones lost all four cases last year. Judges in Texas and
Connecticut ruled him liable by default after he refused to comply
with discovery orders. The families' victories in those lawsuits
set the stage for three trials for damages, after two of the cases
were combined. In the first, in August 2022, a jury awarded Neil
Heslin and Scarlett Lewis, parents of the Sandy Hook victim Jesse
Lewis, 6, compensatory and punitive damages of nearly $50 million.
The second is in progress in Superior Court in Waterbury, Conn.,
resulting from a lawsuit filed by the families of eight other
victims.
Mr. Jones is in Connecticut and is expected to testify in the
damages trial this week. On Tuesday, September 20, 2022,Judge Lopez
cited Mr. Jones's spending of $80,000 for "security" for his trip
to Connecticut as one of the questionable expenses prompting his
decision to impose additional oversight. Mr. Jones has also run up
tens of thousands of dollars in credit card debt, according to his
court filings.
"This was a monumental step in increasing the transparency around a
bankruptcy that Jones and his proxies have until now been keeping
in the dark," said Avi Moshenberg, who is representing the Sandy
Hook families in a separate lawsuit against Mr. Jones.
In a filing to the bankruptcy court in late August, the families
accused Mr. Jones of funneling assets from his business to himself
and his relatives. The Sandy Hook families said in the filing that
Mr. Jones had siphoned nearly $62 million from his business into
financial vehicles benefiting himself and his family beginning in
2018, when the Sandy Hook families first filed suit.
Mr. Jones's $54 million debt to PQPR is fictional, the families'
lawyers said in the August filing, calling the claim "a centerpiece
of Jones’s plan to avoid compensating the Sandy Hook families."
About Free Speech Systems
Free Speech Systems LLC is a broadcast media production and
distribution company that provides broadcasting aural programs by
radio to the public. Free Speech Systems is a family-run business
founded by Alex Jones.
FSS is presently engaged in the business of producing and
syndicating Jones' radio and video talk shows and selling products
targeted to Jones' loyal fan base via the Internet. Today, FSS
produces Alex Jones' syndicated news/talk show (The Alex Jones
Show) from Austin, Texas, which airs via the Genesis Communications
Network on over 100 radio stations across the United States and via
the internet through websites including Infowars.com.
Due to the content of Alex Jones' shows, Jones and FSS have faced
an all-out ban of Infowars from mainstream online spaces. Shunning
from financial institutions and banning Jones and FSS from major
tech companies began in 2018.
Conspiracy theorist Alex Jones has been sued by victims' family
members over Jones' lies that the 2012 Sandy Hook Elementary School
shooting was a hoax.
Jones' InfoW LLC and affiliates, IWHealth, LLC and Prison Planet
TV, LLC, filed petitions under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April
18, 2022.
The Debtors agreed to the dismissal of the Chapter 11 cases in June
2022 after the Sandy Hook victim families dismissed the three
bankrupt companies from their lawsuits.
Free Speech Systems filed a voluntary petition for relief under
Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex.
Case No. 22-60043) on July 29, 2022. In the petition filed by W.
Marc Schwartz, as chief restructuring officer, the Debtor reported
assets and liabilities between $50 million and $100 million.
Melissa A Haselden has been appointed as Subchapter V trustee.
Raymond William Battaglia, of Law Offices of Ray Battaglia, PLLC,
is the Debtor's counsel.
JUMBA LLC: Files for Chapter 11 to Stop Foreclosure
---------------------------------------------------
The Jumba LLC filed for chapter 11 protection in the Northern
District of Texas to avoid foreclosure.
On Oct. 7, 2021, the Humpheries, through their company, C&G Realty
E, LLC, sold approximately 556.81 acres to the Debtor for the
purchase price of $4,538,002. The same was to be paid for by a
$20,000 deposit and $1,010,822 downpayment followed by 10 monthly
interest payments, with the balance due on Aug. 8, 2022. Mr. Brian
Frazier, a homebuilder, a representative for the Debtor, also
personally guaranteed purchase obligations of the Debtor.
The Purchase Agreement expressly contemplated the development of
the land, the construction of homes on the Johnson County Property,
with the sales of each home. C&G agreed to executing partial
releases on each home sale in exchange for a lump sum payment of
$500,000 to be applied to reduce the principal balance.
Pursuant to a joint venture with Mr. Frazier's homebuilding
business, the Debtor had all six homes substantially completed and
had them scheduled for closings in early August.
The maturity date on the Note obligation to C&G was August 8, 2022
and the Debtor was unable to obtain commitments from the various
homebuyers and their lenders that all would be ready to close by
that date. So, the Debtor sought a short extension.
The material terms of all home sales were shared with C&G prior to
the maturity date and an extension of the maturity date was sought
to enable the Debtor to complete the sales.
Due to the passage of the maturity deadline, C&G sent a 5-day
Notice to Cure, rejecting the terms of proposed forbearance and
partial releases.
Although an even more generous offer for a short forbearance was
submitted by Debtor's counsel in September, C&G rejected it and
posted the Johnson County Property for Foreclosure. This posting
further jeopardizes the existing home contracts.
As each day passes, the increase in inventory on the market, and
changing interest rates, also jeopardize the Debtor's ability to
close on all six homes with the original buyers. The sales prices
of the homes are between $459,000 and $579,000.
C&G has also now posted the Johnson County Property for foreclosure
sale on October 4, 2022, concerning lenders who have committed to
homeowners' loans for these purchases.
The Jumba, LLC filed its voluntary chapter 11 petition on September
23, 2022 because the value of the Johnson County Property far
exceeds the debt due to C&G.
Similar raw land in the same area as the Johnson County Property is
presently listed for between $28,045 per acre up to $50,586.80 per
acre in September of 2022. Thus, the land itself is worth in
excess of $15 million at this time. The fact that approximately 60
acres have been improved with luxury homes, has increased the value
by more than $3 million. Additionally, there is a small rental
house on the property valued at approximately $300,000.
Lenders on other land of the Debtor have accepted the difficulties
in the homebuilding and real estate markets since March of 2020 and
worked with the Debtor. Unfortunately, C&G has not been willing to
provide an extension on the maturity date, nor partial releases to
facilitate closings on the homes and partial payments on the
principal debt.
Bankruptcy was filed to save the Debtor’s substantial equity in
the Johnson County Property.
The Jumba LLC estimated total debt of $1 million to $10 million to
1 and 49 creditors. The petition states that funds will be
available to unsecured creditors.
About Jumba LLC
The Jumba LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Tex. Case No. 22-31740) on September
23, 2022. In the petition filed by Andrea Vernon, as manager, the
Debtor reported assets between $10 million and $50 million and
liabilities between $1 million and $10 million.
The Debtor is represented by Lyndel Anne Vargas of Cavazos
Hendricks Poirot, P.C.
KEEPITSIMPLE.US: Trustee Taps Christian & Denaburg as Accountant
----------------------------------------------------------------
Brian Walding, Subchapter V trustee for KeepITSimple.us, LLC, seeks
approval from the U.S. Bankruptcy Court for the Northern District
of Alabama to employ Christian & Denaburg, PC as its accountant.
The firm will prepare the Debtor's tax returns and assist the
trustee regarding payments made by the Debtor.
The firm will be paid at these hourly rates:
Accountants $145 - $400
Bookkeepers $120 - $140
Non-Accountants $70 - $120
As disclosed in court filings, Christian & Denaburg is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Edmond R. Denaburg, CPA
Christian & Denaburg, PC
2649 Rocky Ridge Lane
Birmingham, AL 35216
Phone: +1 205-967-8901
Email: erd@christiandenaburg.com
About KeepITSimple.us LLC
KeepITSimple.us, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ala. Case No.
21-02986) on Dec. 31, 2021, listing up to $500,000 in assets and up
to $1 million in liabilities. Thomas A. Kane, manager and member,
signed the petition.
Judge D. Sims Crawford oversees the case.
Daniel D. Sparks, Esq., and Bill D. Bensinger, Esq., at Christian &
Small, LLP serve as the Debtor's bankruptcy attorneys while Edmond
R. Denaburg, CPA of Christian & Denaburg, PC is the Debtor's
accountant.
KINSEY & KINSEY: Creditors Will be Paid in Full in 5 Years
----------------------------------------------------------
Kinsey & Kinsey, Inc., filed with the U.S. Bankruptcy Court for the
Northern District of Illinois a First Amended Plan of
Reorganization.
The Debtor is an Illinois corporation. Since 1982, the Debtor has
been in the information technology business.
This Plan provides that all creditors will be paid in full. This
Plan also provides for the payment of administrative and priority
claims.
Class 6 consists of non-priority unsecured claim of Bellin Memorial
Hospital, Inc. Commencing upon the first day of the first month
following the date an order disposing of the Dec Action becomes a
final non-appealable order, including the resolution of any appeal
of the Dec Action, Bellin's Unsecured Claim, after being reduced by
any Allowed Settlement Offset, will be paid an amount equal to the
total amount paid to the holders of the Class 7 Other Non-priority
unsecured claims, and the balance of its $600,000 Class 6 Claim in
60 equal monthly payments. Bellin's Unsecured Claim is impaired.
Bellin's Unsecured Claim total $600,000.
The Class 7 Other Non-priority Unsecured Claims will be paid in
full upon the Plan Effective Date. The Class 7 Claims are
unimpaired. Other Non-priority Unsecured Claims total $81,445.66.
Class 8 consists of equity security holders of the Debtor. The
Debtor's two equity security holders will retain their interests in
the Debtor and be unimpaired under the Plan.
This Plan of Reorganization proposed to pay creditors of the Debtor
from net cash flow from operations of the Reorganized Debtor
("Disposable Income") for a 5-year period. To the extent necessary,
the Plan will also be funded from payments that would be made by
the Debtor's 2 shareholders under the terms of their personal
guaranty of the Reorganized Debtor's payment obligations under the
Plan. The shareholders' guaranty obligations to Bellin will be
secured with $400,000 of collateral.
A full-text copy of the First Amended Plan of Reorganization dated
September 22, 2022, is available at https://bit.ly/3UO7SoT from
PacerMonitor.com at no charge.
Debtor's Counsel:
Chester H. Foster, Jr., Esq.
Foster Legal Services, PLLC
16311 Byron Drive
Orland Park, IL 60462
Phone: (708) 403-3800
Email: chj@fosterlegnlservices.com
About Kinsey &
Kinsey
Kinsey & Kinsey, Inc. provides a broad range of expertise in the
areas of financials, procurement, human resources, payroll,
budgeting, planning, distribution and manufacturing. It is based in
Glen Ellyn, Ill.
Kinsey & Kinsey filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. N.D. Ill. Case No. 22-06775) on June
16, 2022, listing $851,664 in assets and $1,396,477 in liabilities.
Ken Novak serves as Subchapter V trustee.
Judge Carol A. Doyle oversees the case.
Chester H. Foster, Jr., Esq. at Foster Legal Services, PLLC is the
Debtor's counsel.
LATAM AIRLINES: Goldman Sachs Kicks Off Loan for Chapter 11 Exit
----------------------------------------------------------------
Jill R. Shah and Jeannine Amodeo of Bloomberg News report that a
group of banks led by Goldman Sachs Group Inc. launched a leveraged
loan sale that will support Latam Airlines Group SA's exit from
bankruptcy.
The $750 million term loan will repay existing debtor-in-possession
facilities and cover general corporate purposes, according to a
person familiar with the matter, who asked not to be identified
discussing a private transaction.
The Santiago-based airline company won court approval for a
restructuring in June after a struggle to win lender support.
About LATAM Airlines Group
LATAM Airlines Group S.A. -- http://www.latam.com/-- is a
pan-Latin American airline holding company involved in the
transportation of passengers and cargo and operates as one unified
business enterprise. It is the largest passenger airline in South
America.
Before the onset of the COVID-19 pandemic, LATAM offered passenger
transport services to 145 different destinations in 26 countries,
including domestic flights in Argentina, Brazil, Chile, Colombia,
Ecuador and Peru, and international services within Latin America
as well as to Europe, the United States, the Caribbean, Oceania,
Asia and Africa.
LATAM and its 28 affiliates sought Chapter 11 protection (Bankr.
S.D.N.Y. Lead Case No. 20-11254) on May 25, 2020. Affiliates in
Chile, Peru, Colombia, Ecuador and the United States are part of
the Chapter 11 filing.
The Debtors disclosed $21,087,806,000 in total assets and
$17,958,629,000 in total liabilities as of Dec. 31, 2019.
The Hon. James L. Garrity, Jr., is the case judge.
The Debtors tapped Cleary Gottlieb Steen & Hamilton LLP as
bankruptcy counsel, FTI Consulting as restructuring advisor, Lee
Brock Camargo Advogados as local Brazilian litigation counsel, and
Togut, Segal & Segal LLP and Claro & Cia in Chile as special
counsel. The Boston Consulting Group, Inc. and The Boston
Consulting Group UK LLP serve as the Debtors' strategic advisors.
Prime Clerk LLC is the claims agent.
The official committee of unsecured creditors formed in the case
tapped Dechert LLP as its bankruptcy counsel, Klestadt Winters
Jureller Southard & Stevens, LLP as conflicts counsel, UBS
Securities LLC as investment banker, and Conway MacKenzie, LLC as
financial advisor. Ferro Castro Neves Daltro & Gomide Advogados is
the committee's Brazilian counsel.
The Ad Hoc Group of LATAM Bondholders tapped White & Case LLP as
counsel.
Glenn Agre Bergman & Fuentes, LLP, led by managing partner Andrew
Glenn and partner Shai Schmidt, has been retained as counsel to the
Ad Hoc Committee of Shareholders.
LOADCRAFT INDUSTRIES: Files Amendment to Disclosure Statement
-------------------------------------------------------------
Loadcraft Industries, Ltd., submitted an Amended Proposed
Disclosure Statement for Plan of Reorganization dated September 22,
2022.
This Plan contemplates a for a reorganization of the Debtor
business as an engineering and sales firm focusing on oilfield
parts, sales, Category IV rig inspections, rig rebuilds and
specialized oilfield equipment, as the Debtor has sold most of its
manufacturing equipment and operations during the course of this
Bankruptcy case. Creditors will receive periodic payments.
Class I consists of Administrative Claims. Paid on the Effective
Date or as agreed by the parties. The postpetition advances made by
Glorious Splendor, LLC and Alphonso Energy, LLC (totaling
$331,822.00 as of September 1, 2022, and estimated to total
approximately $504,000.00 through the Effective Date) shall be
treated as Administrative Claims and paid in the same manner as
provided for treatment of Class II Tax Claims provided, however,
that no lien shall be provided for Glorious Splendor, LLC and
Alphonso Energy, LLC.
Class II consists of Tax Claims. Debtor estimates that Allowed
Class II Claims total $1,213,222.00. Liens retained; payment from
ongoing operations and cash infusion, in equal monthly installments
beginning March 3, 2023, plus statutory interest, with final
payment no later than 60 months from the Petition Date. Upon the
sale of the Brownwood Facility (and equipment therein), these
claims will be paid in full from the proceeds or, if the proceeds
are insufficient, the balance will be amortized in monthly payments
over the remaining term. The Reorganized Debtor shall have the
right to sell the Brownwood Facility free and clear of lien claims
so long as the proceeds, net of usual and typical closing costs and
expenses are paid to the Allowed Trust Fund Taxes.
Class IV consists of General Unsecured Creditors. Debtor estimates
that Allowed Class IV Claims total approximately $3.7 million.
Holders of Allowed General Unsecured Claims will receive pro-rata
distributions representing 10% of their Allowed Claim, paid in
equal quarterly installments over a 48 month period beginning March
3, 2023. The Reorganized Debtor shall have the right to prosecute,
compromise, sell or abandon the Reserved Claims in the exercise of
its business judgment. In addition to the distributions, Holders of
Allowed General Unsecured Claims shall receive 10% of the proceeds
obtained by the Reorganized Debtor from the Reserved Claims net of
attorneys' fees and costs incurred by the Reorganized Debtor in
prosecution of such claims. This Class is impaired.
Class V consists of Unsecured Convenience Class. Holders of claims
at or under $500.00 to receive 100% of their Allowed Claim, without
interest, in two equal monthly payments on April 1, 2023 and May 1,
2023. Debtor estimates that Allowed Class V Claims will total
approximately $26,000.00.
Class VI consists of Equity Interests. Equity holders will have
their equity interest terminated on the Effective Date and will
receive nothing under the Plan as a consequence of their
prepetition equity interest and new equity (i.e. limited
partnership interests) shall be issued to Brian Alphonso [67%] and
Charles Hinkle [32%], or entities designated by them prior to the
Confirmation Hearing, in return for cancellation of all
indebtedness owed to each of them, Alphonso Energy, LLC and/or
Nestor Outcomes, LLC (other than the Post-Petition amounts provided
by Glorious Splendor, LLC and Alphonso Energy, LLC, an entity owned
by Mr. Alphonso). Alphonso Energy, LLC has filed a proof of claim
(No. 23) for $1,792,278.30 for amounts asserted as a prepetition
claim. Nestor Outcomes, LLC LLC has filed a proof of claim (No. 64)
for $839,351.27 for amounts asserted as a prepetition claim. 1% of
limited partnership interests shall be held by the general partner
of the Debtor.
All Cash necessary for the Reorganized Debtor to make payments
pursuant to the Plan shall be obtained from operations of the
Debtor and, potentially, a sale of the Brownwood Facility.
Reorganized Debtor may issue additional equity and/or limited
partnership interests as deemed reasonable and necessary in the
exercise of its business judgment.
A full-text copy of the Amended Disclosure Statement dated
September 22, 2022, is available at https://bit.ly/3LPkzfa from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
Eric Taube, Esq.
Mark Taylor, Esq.
William R. Nix, III , Esq.
Waller Lansden Dortch & Davis, LLP
100 Congress Avenue, Suite 1800
Austin, TX 78701
Tel: (512) 685-6400
Fax: (512) 685-6417
Email: Eric.Taube@wallerlaw.com
Mark.Taylor@wallerlaw.com
Trip.Nix@wallerlaw.com
About Loadcraft Industries
Based in Brady, Texas, Loadcraft Industries specializes in the
manufacturing of mobile drilling rig and custom oilfield
equipment.
Loadcraft Industries sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. W.D. Texas Case No. 21-11018) on Dec. 30,
2021, listing as much as $10 million in assets and liabilities.
Judge Tony M. Davis oversees the case.
The Debtor tapped Waller Lansden Dortch & Davis, LLP and HMP
Advisory Holdings, LLC as legal counsel and restructuring advisor,
respectively. Gregory Milligan, executive vice president of HMP,
serves as the Debtor's chief restructuring officer.
MCCLAIN INVESTMENTS: Case Summary & Four Unsecured Creditors
------------------------------------------------------------
Debtor: McClain Investments TN LLC
1515 Ashwood Avenue
Nashville, TN 37212
Business Description: The Debtor owns four properties located
in Nashville, Tennessee having a total
value of $3.53 million.
Chapter 11 Petition Date: September 29, 2022
Court: United States Bankruptcy Court
Middle District of Tennessee
Case No.: 22-03142
Judge: Hon. Randal S. Mashburn
Debtor's Counsel: R. Alex Payne, Esq.
DUNHAM HILDEBRAND, PLLC
2416 21st Ave. S. Suite 303
Nashville, TN 37212
Tel: 629-777-6529
Fax: 615 777 3765
Email: alex@dhnashville.com
Total Assets: $3,525,006
Total Liabilities: $3,673,451
The petition was signed by Brian Layton as owner.
A full-text copy of the petition containing, among other items, a
list of the Debtor's four unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/OSUB2WI/McClain_Investments_TN_LLC__tnmbke-22-03142__0001.0.pdf?mcid=tGE4TAMA
MOLECULAR IMAGING: Seeks Cash Collateral Access
-----------------------------------------------
Molecular Imaging Chicago, LLC, d/b/a Advantage Diagnostics
Imaging, asks the U.S. Bankruptcy Court for the Northern District
of Illinois, Eastern Division, for authority to use cash collateral
effective September 22, 2022.
The Debtor requires the interim use of cash collateral to pay the
necessary costs associated with the operation of its business and
requests that the Court conduct a preliminary hearing, instanter,
on the Motion and set the matter for final hearing on October 25,
2022, at 1:30 p.m.
The three creditors that may assert a security interest in and to
the assets of the Debtor are Byline Bank, the Internal Revenue
Service, and Chicago Title Land Trust Company Successor Trustee to
Amalgamated Bank of Chicago U/T #5770.
Byline, as successor in interest to Ridgestone Bank, is a secured
creditor of the Debtor by virtue of the following:
a. A Mortgage, Assignment of Rents, Security Agreement, and
Fixture Filing dated June 6, 2015, related to the commercial
property located at 215 Remington Blvd., Suite J, Bolingbrook,
Illinois; and
b. A U.S. Small Business Administration Note dated June 6,
2014 in the original principal amount of $3,235,000, as amended by
a Certain Forbearance and Deed in Lien Agreement dated May 1, 2020,
and Security Agreement which is secured by the Bolingbrook Property
and a lien on the assets of the Debtor. The current balance due
under the loan is approximately $2,054,794.
Byline asserts a perfected security interest in the Collateral by
virtue of a UCC Financing Statement filed with the Illinois
Secretary of State on June 6, 2014, with a continuation statement
filed on April 15, 2019.
The IRS may assert a lien interest in the Collateral based upon the
filing of it notices of lien in 2015, with the State of Illinois
and Cook County for unpaid withholding taxes. The total secured
claim asserted by the IRS is unknown at this time.
CTLTC may assert a lien interest in the Collateral based upon a
Promissory Note and Security Agreement Dated December 20, 2021,
which interest was perfected by virtue of a UCC Financing Statement
filed with the Illinois Secretary of State on February 24, 2022.
The current balance due to CTLTC is $52,139. Based upon Byline's
and the IRS' higher priority lien claims in and to the Collateral,
there exists no equity in the Collateral to support CTLTC's secured
claim.
The Debtor's assets consist of the Bolingbrook Property, cash
deposits, accounts receivables, imaging equipment, office furniture
and furnishings and general intangibles the value of which is
estimated to be approximately $499,795.
As and for adequate protection for the interests of Byline and
other lien claimants in the Collateral, the Debtor proposes that:
a. Byline and any other lien claimants will be granted valid
and perfected replacement liens in and to post-petition cash
collateral and all post-petition property of the Debtor of the same
type or kind substantially equivalent to the pre-petition
Collateral (excepting avoidance actions of the estate) to the same
extent and with the same priority as held pre petition; and
b. Insurance will be maintained on the Collateral and the
policy will reflect Byline as a lienholder and loss payee.
A hearing on the matter is set for October 4, 2022 at 1 p.m.
A copy of the motion is available at https://bit.ly/3CgQL7U from
PacerMonitor.com.
About Molecular Imaging Chicago LLC
Molecular Imaging Chicago LLC is dedicated to providing diagnostic
testing services, including PET/CT, MRI (Open and High Field),
Diagnostic CT, EMG/NCV, Ultrasound, Arthrogram, and Digital X-Ray
services.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Court (Bankr. N.D. Ill. Case No. 22-10864) on September
22, 2022. In the petition signed by Rajeev Batra, managing member,
the Debtor disclosed up to $500,000 in assets and up to $10 million
in liabilities.
Judge Jacqueline P. Cox oversees the case.
Gregory K. Stern, Esq., at Gregory K. Stern, P.C., is the Debtor's
counsel.
NORTHSIDE VENTURES: Case Summary & 14 Unsecured Creditors
---------------------------------------------------------
Debtor: Northside Ventures LLC
100 Washington
Michigan City, IN 46360
Business Description: The Debtor is a Single Asset Real Estate
(as defined in 11 U.S.C. Section 101(51B)).
Chapter 11 Petition Date: September 29, 2022
Court: United States Bankruptcy Court
Northern District of Indiana
Case No.: 22-30994
Debtor's Counsel: Bruce de'Medici, Esq.
DE'MEDICI LAW
318 West Adams Street 1600
Chicago, IL 60606
Tel: (312) 731-6778
Email: bdemedici@gmail.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Jason Gatzka as manager.
A copy of the Debtor's list of 14 unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/VOZU6SQ/Northside_Ventures_LLC__innbke-22-30994__0002.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/VAUFQNI/Northside_Ventures_LLC__innbke-22-30994__0001.0.pdf?mcid=tGE4TAMA
NRP VENTURES: Taps Everett Gaskins Hancock as Bankruptcy Counsel
----------------------------------------------------------------
NRP Ventures, LLC seeks approval from the U.S. Bankruptcy Court for
the Eastern District of North Carolina to employ the law firm of
Everett Gaskins Hancock LLP as its bankruptcy counsel.
The firm's services include:
a. undertaking any and all steps and actions necessary to
authorize the use of cash collateral pursuant to Section 363 of the
Bankruptcy Code, if applicable;
b. advising the Debtor with respect to its powers and duties
in the continued management, operation, and reorganization of its
business;
c. reviewing any and all claims asserted against the Debtor by
its creditors, equity holders, and parties in interest;
d. representing the Debtor's interests at the meeting of
creditors under Section 341 of the Bankruptcy Code, and at any
other hearing or conference scheduled in the bankruptcy case before
the court related to the Debtor;
e. attending any meetings, conferences, and negotiations with
representatives of creditors and other parties in interest;
f. reviewing and examining, if necessary, any and all
transfers which may be avoided as preferential or fraudulent
transfers under the appropriate provisions of the Bankruptcy Code;
g. taking any and all necessary actions to protect and
preserve the Debtor's estate, including the prosecution of actions
on the Debtor's behalf, the defense of any action commenced against
the Debtor, negotiations concerning all litigation in which the
Debtor is, or may become involved, and objections to any claims
filed against the bankruptcy estate of the Debtor;
h. preparing legal papers;
i. preparing\ any plan of reorganization, disclosure
statement, and all related agreements or documents, and taking any
necessary actions to obtain confirmation of such plan of
reorganization and approval of such disclosure statement;
j. representing the Debtor in connection with any potential
post-petition financing;
k. advising the Debtor in connection with the sale or
liquidation, if applicable, of any assets and property to third
parties;
l. appearing before the court, or any such appellate court,
and the Office of the Bankruptcy Administrator to protect the
interests of the Debtor and the bankruptcy estate;
m. representing the Debtor with respect to any general,
corporate, or transactional matters that arise during the course of
the administration of the bankruptcy case; and
n. assisting and advising the Debtor with respect to
negotiation, documentation, implementation, consummation, and
closing of any corporate transactions, including sales of assets.
Everett Gaskins Hancock will be paid at these rates:
William H. Kroll, Attorney $350 per hour
James M. Hash, Attorney $350 per hour
Mindy T. Lee, Paralegal $125 per hour
The firm received a retainer in the amount of $5,000.
As disclosed in court filings, Everett Gaskins Hancock is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
William H. Kroll, Esq.
Everett Gaskins Hancock LLP
220 Fayetteville Street, Suite 300
Raleigh, NC 27602
Phone: 919-755-0025
Email: 11705@notices.nextchapterbk.com
About NRP Ventures
NRP Ventures, LLC filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.C. Case No.
22-02046) on Sept. 11, 2022, with between $1 million and $10
million in assets and between $10 million and $50 million in
liabilities.
Judge Pamela W Mcafee presides over the case.
William H. Kroll, Esq. at Everett Gaskins Hancock, LLP represents
the Debtor as counsel.
NWJS INC.: Rings & Things Shuts Down After 50 Years
---------------------------------------------------
Virginia Thomas of Spokane Journal reports that after 50 years in
business, Spokane jewelry component and bead wholesaler Rings &
Things has closed its doors, and the company that operates it,
NWJS, Inc., filed for liquidation under Chapter 7 of the U.S.
Bankruptcy Code.
A post on the Rings & Things Facebook page states the company shut
down due to technical issues.
"Sadly, our system data is unrecoverable, and with it gone, Rings &
Things is permanently closed," the post says. "In the morning of
Tuesday, August 15, we were happily shipping 50th anniversary sale
orders, and by noon, we were dead in the water, with no way to even
post anything on our website to explain."
The post states the company is working with another long-term
jewelry-parts supplier to shift its top items to them, and
concludes with, "We regret being busy busy optimists ...we did not
have a functional backup in place."
The Rings & Things warehouse showroom, located at 1011 E. Second,
was shuttered during business hours on the afternoon of Sept. 19,
with a sign on the door saying the business was closed until
further notice. The company's website was still accessible as of
Sept. 20, but its shopping cart feature appeared disabled.
A representative of Rings & Things didn't respond to a request for
comment. David P. Gardner, an attorney with Spokane-based Winston
Cashatt Lawyers who represented NJWS in the bankruptcy, confirms
the Chapter 7 filing but declines to comment further.
The Sept. 1 filing in the Eastern District bankruptcy court shows
NJWS had more than $894,000 in liabilities owed to between 50 and
99 creditors, and about $250,000 in assets, about $230,000 of which
was in inventory. Creditors included a California-based capital
investment company, to which Rings & Things owed $320,000, as well
as 63 unsecured creditors owed between $90 and $194,000 each, and
10 Spokane residents who were owed between $100 and $536 per
person.
In May 2020, the business received $155,800 from the federal
government’s Paycheck Protection Program, according to New
York-based investigative journalism nonprofit organization
ProPublica's Paycheck Protection Program data tool. At the time,
Rings & Things reported having 23 employees. The loan was forgiven
in February 2021.
According to the Chapter 7 filing, the company had gross revenue of
$2 million last year.
Rings & Things began here in 1972 in a creative incubator called
Second City. Company founder Russ Nobbs had started making jewelry
in the 1960s and selling his creations at state fairs before
starting a retail space. The company had a retail space in River
Park Square for many years.
In 2000, Rings & Things closed the retail side of its business and
began exclusively selling wholesale to its more than 40,000
clients. In 2004, the business remodeled and moved into a
40,000-square-foot building at 304 E. Second, near the eastern edge
of downtown. At the time, Nobbs told the Journal Rings & Things was
making between $5 million and $10 million in revenue per year.
Russ Nobbs handed the reins to his children, Polly LaRue and Skylar
Nobbs, in 2014, shortly before he died. LaRue maintained 51%
ownership, while Nobbs had 49% ownership in Rings & Things,
according to the court filing.
Rings & Things moved in 2020 to its most recent warehouse and
showroom space along Second Avenue.
About Rings & Things
NWJS, Inc., doing business as Rings & Things, is Spokane,
Washington-based jewelry component and beads wholesaler.
NWJS, Inc., filed a Chapter 7 bankruptcy petition (Bankr. E.D.
Wash. Case No. 2:22-bk-00822) on Sept. 1, 2022. The Debtor reports
more than $894,000 in liabilities owed to between 50 and 99
creditors, and about $250,000 in assets.
The Debtor's counsel:
David P Gardner
Winston & Cashatt, Lawyers, P.S.
Tel: 509-838-6131
E-mail: dpg@winstoncashatt.com
PBJAK LLC: Taps Deanne Walker of Trent Properties as Broker
-----------------------------------------------------------
PBJAK, LLC seeks approval from the U.S. Bankruptcy Court for the
District of Colorado to hire Deanne Walker, managing broker at
Trent Properties Group.
The Debtor requires a broker in connection with the sale of its
real property located at 702 Manitou Ave., Manitou Springs, Colo.
Ms. Walker will charge a percentage fee commission for the sale.
In court filings, Ms. Walker disclosed that she and her firm are
"disinterested" within the meaning of Section 101(14) of the
Bankruptcy Code.
Ms. Walker holds office at:
Deanne Walker
Trent Properties Group
2115 W Colorado Ave
Colorado Springs, CO 80904
Phone: 719-630-1600
Email: deanne@deannewalker.com
About PBJAK LLC
PBJAK, LLC filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. D. Colo. Case No. 22-11149) on April 5,
2022, with up to $10 million in assets and up to $1 million in
liabilities. Harvey Sender serves as Subchapter V trustee.
Judge Elizabeth E. Brown oversees the case.
Stephen Berken, Esq., and Sean Cloyes, Esq., at Berken Cloyes, PC
are the Debtor's bankruptcy attorneys.
PEAK THEORY: Seeks to Hire Parsons Behle & Latimer as Counsel
-------------------------------------------------------------
Peak Theory, Inc. seeks approval from the U.S. Bankruptcy Court for
the District of Utah to hire Parsons Behle & Latimer as its legal
counsel.
The firm will render these services:
(a) advise the Debtor and take all necessary or appropriate
actions at the Debtor's direction with respect to protecting and
preserving its estate, including the defense of any actions
commenced against the Debtor, the negotiation of disputes in which
the Debtor is involved, and the preparation of objections to claims
filed against the estate;
(b) prepare legal papers;
(c) take all necessary or appropriate actions in connection
with a plan of reorganization and related disclosure statement;
(d) prepare documentation and take other necessary or
appropriate actions to accomplish the reorganization of the Debtor;
and
(e) perform other necessary legal services in connection with
the prosecution of the Debtor's Chapter 11 case.
The firm will be paid at these hourly rates:
Brian M. Rothschild, Shareholder $400
Darren Neilson, Of counsel $375
Simeon J. Brown, Associate $300
Angalee Draidfort, Paralegal $200
The Debtor provided the firm with retainers in the total amount of
$10,000.
As disclosed in court filings, Parsons Behle & Latimer and its
attorneys are "disinterested" within the meaning of Section 101(14)
of the Bankruptcy Code.
The firm can be reached through:
Brian M. Rothschild, Esq.
Darren Neilson, Esq.
Parsons Behle & Latimer
201 South Main Street, Suite 1800
Salt Lake City, UT 84111
Telephone: 801-532-1234
Facsimile: 801-536-6111
Email: BRothschild@parsonsbehle.com
DNeilson@parsonsbehle.com
About Peak Theory Inc.
Peak Theory Inc. owns and operates retail stores. It is based in
Salt Lake City, Utah.
Peak Theory sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Utah Case No. 22-23480) on Sept. 5,
2022, with between $100,000 and $500,000 in assets and between $1
million and $10 million in liabilities. Zac Park, president of Peak
Theory, signed the petition.
Judge Joel T. Marker oversees the case.
The Debtor tapped Darren Neilson, Esq., at Parsons Behle & Latimer
as legal counsel and CFO Solutions LLC, doing business as Ampleo,
as accountant and financial advisor.
PHOENIX SERVICES: Pachulski, Gibson Advise on DIP/First Lien Group
------------------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
the law firms of Gibson, Dunn & Crutcher LLP and Pachulski Stang
Ziehl & Jones LLP submitted a verified statement to disclose that
they are representing the DIP/First Lien Group in the Chapter 11
cases of Phoenix Services Topco, LLC et al.
In or around May 2022, the DIP/First Lien Group was formed and
retained attorneys currently affiliated with Gibson, Dunn &
Crutcher LLP to represent them as counsel in connection with a
potential restructuring of the outstanding debt obligations of the
above-captioned debtors and certain of their subsidiaries and
affiliates.
Gibson Dunn represents the DIP/First Lien Group, comprised of the
beneficial holders or the investment advisors or managers for
certain beneficial holders that are identified on Exhibit A hereto
in their capacities as lenders under that certain First Lien Credit
Agreement, dated as of March 1, 2018, by and among Phoenix Services
Holdings Corp., as holdings, Phoenix Services International LLC, as
borrower, each of the financial institutions from time to time a
party thereto, and Barclays Bank PLC as administrative agent and
collateral agent.
Gibson Dunn does not represent the DIP/First Lien Group as a
"committee" and does not undertake to represent the interests of,
and is not a fiduciary for, any creditor, party in interest, or
other entity that has not signed a retention agreement with Gibson
Dunn.
Upon information and belief formed after due inquiry, Gibson Dunn
does not hold any disclosable economic interests in relation to the
Debtors.
As of Sept. 27, 2022, the members of the DIP/First Lien Group and
their disclosable economic interests are:
Term Loans
----------
Aegon Asset Management $9,918,953.12
222 W. Adams St., Suite 2050
Chicago, IL 60606
Benefit Street Partners L.L.C. $6,839,422.50
9 W. 57th St., Suite 4920
New York, NY 10019
Blackstone Alternative Credit Advisors LP $50,483,185.78
345 Park Ave.
New York, NY 10154
CVC Credit Partners LLC $17,074,477.20
712 Fifth Ave.
New York, NY 10019
DoubleLine Capital LP $14,840,108.42
2002 N. Tampa Street, Suite 200
Tampa, FL 33602
Eaton Vance Management and $43,949,277.67
Boston Management and Research
2 International Place, 9th Floor
Boston MA 02110
First Eagle Alternative Credit, LLC $7,640,678.93
227 W. Monroe Street, Suite 3800
Chicago, IL 60606
ICG Debt Advisors LLC Manager Series $34,294,904.27
600 Lexington Ave., 18th Floor
New York, NY 10022
Rockford Tower Capital Management, L.L.C. $16,181,059.89
299 Park Ave., 40th Floor
New York, NY 10171
LCM Asset Management LLC $27,597,396.60
399 Park Ave., 22nd Floor
New York, NY 10022
MJX Asset Management LLC $28,677,660.99
12 East 49th St., 38th Floor
New York, NY 10017
Napier Park Global $20,394,643.41
280 Park Ave. 3rd floor
New York, NY 10017
Nassau Corporate Credit $9,661,971.48
17 Old Kings Hwy S
Darien, CT 06820
PGIM, Inc. $25,144,844.98
P.O. Box 32339
Newark, NJ 07102
Shenkman Capital Management, Inc. $11,676,649.00
262 Harbor Dr., 4th Floor
Stamford, CT 06902
Silver Point Capital, L.P. $54,334,745.41
2 Greenwich Plaza, 1st Floor
Greenwich, CT 06830
The DIP/First Lien Group, through its undersigned counsel, reserves
the right to amend or supplement this Verified Statement in
accordance with the requirements of the Bankruptcy Rule 2019 at any
time in the future.
Counsel for the DIP/First Lien Group can be reached at:
PACHULSKI STANG ZIEHL & JONES LLP
Laura Davis Jones, Esq.
Peter J. Keane Esq.
919 North Market Street, 17th Floor
P.O. Box 8705
Wilmington, DE 19899 (Courier 19801)
Tel: (302) 652-4100
Fax: (302) 652-4400
E-mail: ljones@pszjlaw.com
pkeane@pszjlaw.com
- and –
GIBSON, DUNN & CRUTCHER LLP
Scott J. Greenberg, Esq.
Matthew J. Williams, Esq.
Jason Zachary Goldstein, Esq.
200 Park Avenue
New York, NY 10166
Tel: (212) 351-4000
Fax: (212) 351-4035
E-mail: sgreenberg@gibsondunn.com
mjwilliams@gibsondunn.com
jgoldstein@gibsondunn.com
A copy of the Rule 2019 filing, downloaded from PacerMonitor.com,
is available at https://bit.ly/3rh0ox6 and https://bit.ly/3RlC6N9
About Phoenix Services
Phoenix Services provides mission-critical services to leading,
global steel-producing companies. This suite of customer services
primarily includes the removal, handling, and processing of molten
slag at customer sites, as well as the preparation and
transportation of metal scraps, raw materials, and finished
products.
On Sept. 27, 2022, Phoenix Services Holdings Corp. and 8 affiliates
sought Chapter 11 bankruptcy protection. The lead case is In re
Phoenix Services Topco, LLC (Bankr. D. Del. Lead Case No.
22-10906).
The Hon. Mary F. Walrath is the case judge.
Phoenix Services estimated $500 million to $1 billion in assets and
liabilities as of the bankruptcy filing.
The Debtors tapped WEIL, GOTSHAL & MANGES LLP as attorneys;
RICHARDS, LAYTON & FINGER, P.A., as Delaware counsel; ALIXPARTNERS,
LLP as financial advisor; and PJT PARTNERS INC. as investment
banker. STRETTO is the claims agent.
PHOENIX SERVICES: S&P Downgrades ICR to 'D' on Chapter 11 Filing
----------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Phoenix
Services International LLC to 'D' (default) from 'CCC+'. At the
same time, S&P lowered its issue-level rating on Phoenix's senior
secured debt to 'D' from 'CCC+'.
S&P lowered its issuer credit and issue-level ratings on Phoenix to
'D' because the company and certain of its U.S. affiliates filed
for bankruptcy under Chapter 11 of the U.S. Bankruptcy Code. The
company's international affiliates are excluded from the filing.
A group of the company's first-lien lenders have committed to
provide $50 million in new debtor-in-possession financing, subject
to court approval, which the company expects will support its
operations as it completes the Chapter 11 process.
Phoenix filed for bankruptcy in the wake of supply-chain
constraints, rising fuel costs, challenging long-term contracts,
and inflationary headwinds. The company has been facing
deteriorating liquidity, elevated leverage, and has sustained a
steady decline in profitability. Exacerbating these issues is the
company's $65 million asset-based lending facility, due in March
2023.
PREHIRED ACCELERATOR: Voluntary Chapter 11 Case Summary
-------------------------------------------------------
Debtor: Prehired Accelerator, LLC
St. Petersburg, FL 33702
Business Description: The Debtor is a members-only workforce
accelerator and community helping members
get hired, promoted and pursue a 6-figure
potential sales career.
Chapter 11 Petition Date: September 29, 2022
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 22-11310
Debtor's Counsel: Christopher D. Warren, Esq.
WARREN LAW GROUP
519 8th Avenue, 26th Floor
New York, NY 10018
Tel: 866-928-5838
Email: chris@warrenl.law
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joshua Jordan as CEO.
The Debtor did not file a list of its 20 largest unsecured
creditors together with the petition.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/FGMV67I/Prehired_Accelerator_LLC__nysbke-22-11310__0001.0.pdf?mcid=tGE4TAMA
PREHIRED RECRUITING: Voluntary Chapter 11 Case Summary
------------------------------------------------------
Debtor: Prehired Recruiting, LLC
8 The Green Ste B
Dover, DE 19901
Chapter 11 Petition Date: September 29, 2022
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 22-11311
Debtor's Counsel: Christopher D. Warren, Esq.
WARREN LAW GROUP
519 8th Avenue, 25th Floor
New York, NY 10018
Tel: 866-928-5838
Email: chris@warren.law
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Joshua Jordan as CEO.
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/X6OYC6I/Prehired_Recruiting_LLC__nysbke-22-11311__0001.0.pdf?mcid=tGE4TAMA
PUERTO RICO: Mediators Ask 60-Day Deadline for PREPA Exit Plan
--------------------------------------------------------------
The mediators who had been overseeing talks aimed at creating a
restructuring plan for Puerto Rico's electric utility asked a
federal judge on Thursday, September 22, 2022, to restart the
stalled talks and set a 60-day deadline for the island's fiscal
oversight board to file a reorganization plan for the agency.
The Puerto Rico Electric Power Authority owes $8.26 billion in bond
principal, more than $700 million in fuel line of credit loans, as
well as other debt. It has been in Title III bankruptcy since
summer 2017.
The Mediation Team -- comprised of Honorable Shelley C. Chapman as
lead mediator, Honorable Robert D. Drain, and Honorable Brendan L.
Shannon -- was formed to facilitate negotiations among stakeholders
in PREPA's Title III Case.
In a filing on Sept. 22, the Mediation Team indicated its
willingness to continue to oversee Mediation and provided a
proposal regarding the parameters for further mediation.
"Recognizing that the litigation schedule is of direct importance
to the conduct of the Mediation, although also subject to other
considerations that are beyond the Mediation Team's remit, the
Mediation Team believes that the prospects of a successful
Mediation will be greatly enhanced if the litigation schedule
adopted by the Court provides for (a) the Oversight Board's filing
within 60 days a proposed plan of adjustment and related disclosure
statement that contemplates alternative plan treatment depending on
the outcome of the primary lien and claim disputes (a "Toggle
Plan"), (b) the litigation of those disputes in the context of the
Oversight Board's request for confirmation of the Toggle Plan, and
(c) a hearing on the Oversight Board's request to confirm the
Toggle Plan, consistent with an expedited litigation schedule, to
be held no later than June, 2023," the Mediation Team said.
The Official Committee of Unsecured Creditors in response said that
it should be allowed to participate in negotiations and that these
two threshold issues should be litigated first before the deadlines
are set:
(1) whether the PREPA bondholders' security interest is limited
to funds actually deposited into specified accounts held by the
PREPA bond trustee (in the amount of approximately $8.8 million as
of PREPA's petition date); and
(2) whether the PREPA bonds are non-recourse obligations such
that, in accordance with section 927 of the Bankruptcy Code, the
PREPA bondholders have no claim against, and are not entitled to
distributions from, PREPA for any difference between the face
amount of the bonds and the funds on deposit in the specified
account.
Meanwhile, the Financial Oversight and Management Board for Puerto
Rico, as sole Title III representative of PREPA, said that while it
is supportive of continued mediation, it has issues with the
proposed 60-day plan deadline.
"In the big picture, the Bondholders' allowable claim, whether
secured or unsecured, has profound implications for what can be
paid to all other constituencies. The Bondholders propound a claim
in excess of $8 billion without postpetition interest and more than
$10.5 billion with postpetition interest included. If any material
portion of the $8 billion claim is not allowable, it has a dramatic
impact on what PREPA will pay all other allowed claims. There are
too many potential outcomes of the Bondholders' ultimately
allowable secured and unsecured claims for there to be a 'toggle
plan.' We would need multiple toggles! So, the concept is
impracticable as a factual matter," the Oversight Board said.
"It remains the Oversight Board's strong preference to file a
consensual plan, at least in part, and as it currently stands, the
Oversight Board does not have a deal with any major creditor
constituency to serve as an impaired accepting class for a plan.
Because mediation has taken a "staged" approach focusing solely on
the Bondholders' claims, the Oversight Board has not had the
opportunity to complete its negotiations with PREPA's unions or
retiree system, or to meaningfully engage with other creditor
constituencies. The Oversight Board should be given the
opportunity to reach consensus with other parties before it files a
nonconsensual plan," the Oversight Board added.
The Oversight Board said it can commit to filing a proposed plan of
adjustment within 45 days of the earlier of (i) a restructuring
support agreement with a major creditor constituency, or (ii) the
Title III Court's adjudication of the Amended Lien Challenge.
About Puerto Rico
Puerto Rico is a self-governing commonwealth in association with
the United States that's facing a massive bond debt of $70 billion,
a 68% debt-to-GDP ratio and negative economic growth in nine of the
last 10 years.
The Commonwealth of Puerto Rico has sought bankruptcy protection,
aiming to restructure its massive $74 billion debt-load and $49
billion in pension obligations.
The debt restructuring petition was filed by Puerto Rico's
financial oversight board in U.S. District Court in Puerto Rico
(Case No. 17-01578) on May 3, 2017, and was made under Title III of
2016's U.S. Congressional rescue law known as the Puerto Rico
Oversight, Management, and Economic Stability Act ('PROMESA').
The Financial Oversight and Management Board later commenced Title
III cases for the Puerto Rico Sales Tax Financing Corporation
(COFINA) on May 5, 2017, and the Employees Retirement System (ERS)
and the Puerto Rico Highways and Transportation Authority (HTA) on
May 21, 2017. On July 2, 2017, a Title III case was commenced for
the Puerto Rico Electric Power Authority ("PREPA").
U.S. Chief Justice John Roberts has appointed U.S. District Judge
Laura Taylor Swain to oversee the Title III cases. The Honorable
Judith Dein, a United States Magistrate Judge for the District of
Massachusetts, has been designated to preside over matters that may
be referred to her by Judge Swain, including discovery disputes,
and management of other pretrial proceedings.
Joint administration of the Title III cases, under Lead Case No.
17-3283, was granted on June 29, 2017.
The Oversight Board has hired as advisors, Proskauer Rose LLP and
O'Neill & Borges LLC as legal counsel, McKinsey & Co. as strategic
consultant, Citigroup Global Markets, as municipal investment
banker, and Ernst & Young, as financial advisor.
Martin J. Bienenstock, Esq., Scott K. Rutsky, Esq., and Philip M.
Abelson, Esq., of Proskauer Rose; and Hermann D. Bauer, Esq., at
O'Neill & Borges are on-board as attorneys.
McKinsey & Co. is the Board's strategic consultant, Ernst & Young
is the Board's financial advisor, and Citigroup Global Markets Inc.
is the Board's municipal investment banker.
Prime Clerk LLC is the claims and noticing agent. Prime Clerk
maintains a case web site at
https://cases.primeclerk.com/puertorico
Epiq Bankruptcy Solutions LLC is the service agent for ERS, HTA,
and PREPA.
O'Melveny & Myers LLP is counsel to the Commonwealth's Puerto Rico
Fiscal Agency and Financial Advisory Authority (AAFAF), the agency
responsible for negotiations with bondholders.
The Oversight Board named Professor Nancy B. Rapoport as fee
examiner and to chair a committee to review professionals' fees.
* * *
The two Title III plans of adjustment have been confirmed to date,
for the Commonwealth and COFINA debtors.
RICCI TRANSPORT: Intends to Sell 3 Trucks; Files Amended Plan
-------------------------------------------------------------
Ricci Transport & Recovery Inc., submitted a Second Amended Plan of
Reorganization for Small Business dated September 22, 2022.
This amendment to the Plan has been filed to make minor
modifications necessary to obtain support of the creditors. The
Debtor is currently seeking confirmation of this plan under 11
U.S.C. § 1191(a) but will proceed to confirmation under 11 U.S.C.
§ 1191(b) if creditors do not consent to confirmation as §
1191(a) requires.
Schedule E/F was also amended to correct the listed creditor for
the Debtor's 2020 Paycheck Protection Program loan. The Debtor was
recently informed that the PPP loan has been forgiven.
The original plan indicated that the Debtor intended to sell up to
five of its seven tow trucks. But as the monthly operating reports
demonstrate, the Debtor has recently seen an uptick in business
which is made possible by the concurrent operation of four trucks.
Thus, the Debtor intends to pursue the sale of three trucks. No
potential buyers have been identified. Because the three trucks to
be sold have not been operational during the periods for which
operating reports have been submitted, the sale of those trucks
will not have an impact on cash flow projections.
Class 2 consists of the Secured claim of FC Marketplace LLC. Class
2 is impaired by this Plan. The holder of the Class 2 Claim will be
paid in full, in cash, over 36 months at 6% interest. Claimholders
of Class 2 claims are entitled to vote on this plan.
Class 3 consists of Non-priority unsecured creditors and all
deficiency claims of Class 2 claimholders. Class 3 is impaired by
this Plan. Each holder of a Class 3 Claim will be paid in full, in
cash, after all Class 1 and Class 2 claims have been paid in full.
Claimholders of Class 3 claims are entitled to vote on this plan.
The Debtor may sell up to three of its seven tow trucks. If the
trucks are sold pursuant to this Plan, the transaction will be
exempt from transfer tax pursuant to 11 U.S.C. §1146(a). The
Debtor expects that the proceeds of that sale could be as much as
$40,000. The Debtor would be permitted to use the sale proceeds to
pay FC Marketplace LLC in satisfaction of its allowed secured claim
(Class 2). If the proceeds of the sale exceed the amount of FC
Marketplace's allowed secured claim, all excess funds will be paid
to the trustee for distribution to creditors.
A full-text copy of the Second Amended Plan of Reorganization dated
September 22, 2022, is available at https://bit.ly/3rgtJrv from
PacerMonitor.com at no charge.
Counsel for Debtor:
Michael A. Cibik, Esq.
Michael I. Assad, Esq.
Cibik Law, P.C.
1500 Walnut St, Suite 900
Philadelphia, PA 19102
Phone: 215-735-1060
About Ricci Transport & Recovery
Ricci Transport & Recovery, Inc., sought protection for relief
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. Pa. Case No.
22-10969) on April 14, 2022, listing up to $500,000 in both assets
and liabilities.
Judge Eric L. Frank oversees the case.
Michael A. Cibik, Esq., at Cibik Law, PC and Rey's Tax & Accounting
Services serve as the Debtor's counsel and accountant,
respectively.
SAN DIEGO TACO: Gets Cash Collateral Access Thru Oct 1
------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of California
approved the stipulation for further interim use of cash collateral
and for adequate protection filed by San Diego Taco Company, Inc.
and Pacific Premier Bank.
The purpose of the Stipulation is solely to extend the Debtor's
interim use of cash collateral from September 1 to October 1,
2022.
The Debtor is authorized to use the cash collateral up to the
amount and for the specific purposes set forth in the Budget
contained in the Stipulation, October 1, or at a later date as may
be agreed to pursuant to a further written stipulation between the
Debtor and its secured creditor, Pacific Premier Bank, and approved
by the Court without the need for further hearing.
The Court said all other terms and conditions of the stipulation
and the Court's order will remain in effect and binding upon the
Debtor and the Secured Creditor.
A copy of the order is available at https://bit.ly/3E3HZM6
PacerMonitor.com.
About San Diego Taco Company, Inc.
San Diego Taco Company, Inc. operates restaurants that specialize
in Mexican cuisine. The Debtor sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D. Cal. Case No. 21-03594) on
September 2, 2021. In the petition signed by Ernie Becerra III,
president, the Debtor disclosed $615,570 in total assets and
$1,597,598 in total liabilities.
Judge Christopher B. Latham oversees the case.
Jason E. Turner, Esq., at J. Turner Law Group, APC is the Debtor's
counsel.
SAS AB: Court Has 'Reservations' in Approving $700MM DIP Loan
-------------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York --
with "some significant reservations" -- has authorized SAS AB and
affiliates to obtain superpriority, postpetition financing from a
group organized by Apollo Management Holdings, L.P.
The Honorable Michael E. Wiles, in a bench decision, said, "I am
going to approve the proposed financing, although not without some
significant reservations."
SAS subsidiary Scandinavian Airlines Systems Denmark-Norway-Sweden
is permitted to borrow up to an aggregate principal amount of $700
million in DIP Loans pursuant to the SuperPriority
Debtor-in-Possession Term Loan Agreement, dated as of August 13,
2022, by and among SAS AB, Scandinavian Airlines, the Guarantors,
Wilmington Savings Fund Society, FSB as Administrative Agent and
Collateral Agent, and a consortium of the DIP Lenders.
The Debtors require the use of cash collateral and DIP loan for the
continued operation of their businesses and the management and
preservation of their assets and property.
The Obligors are authorized to advance funds, including DIP Loan
proceeds, to the Intercompany Borrowers, pursuant and subject to
the terms of the Intercompany Facility Agreement in accordance with
the DIP Budget and the DIP Loan Documents. Until the DIP
Obligations have been Paid in Full (other than contingent
indemnification obligations for which no claim has been asserted)
and the DIP Commitments have been terminated, the Intercompany
Loans shall be collaterally assigned to the Agent for the benefit
of the DIP Secured Parties in accordance with the terms of the
Collateral Assignment Agreement and the other DIP Loan Documents.
As adequate protection, the DIP Secured Parties are granted a
valid, binding, enforceable, non-avoidable, continuing and
automatically and fully perfected first priority senior security
interest in and lien on all prepetition and postpetition property
of the Obligors and a valid, binding, continuing, enforceable,
fully perfected security interest in and lien on all prepetition
and postpetition property of the Obligors.
"The proposed DIP Agreement includes some unusual terms," Judge
Wiles pointed out in his bench decision issued more than a week
after signing on the DIP Loan Approval order.
"If I had an objection in front of me, I would have a lot of
questions about this arrangement, not only in terms of the relevant
principles, but also as to whether the proposal ultimately makes
economic sense. But I do not have such an objection."
Judge Wiles pointed to these terms:
* The DIP Agreement includes a call option under which the DIP
Lenders would have the right to convert their outstanding DIP
loans, or to pay cash, to acquire equity to be issued by the
Debtors under a plan of reorganization. The equity to be purchased
would have a value, at the election of the DIP Lenders, equal to
the greater of the actual outstanding DIP obligation at the
effective date or $700 million plus some accumulation of interest
and fees. The option would be exercisable on the assumption that
the reorganized Debtors collectively have a total enterprise value
of $3.2 billion, calculated in accordance with a methodology set
forth in Schedule 6.15(a) to the DIP Agreement. If a proposed plan
were on file that was premised on a total enterprise value of $3.3
billion, Apollo would have the right to buy $700 million or more
of equity that would be valued as if the total enterprise value
were $3.2 billion, thereby effectively allowing Apollo to buy the
equity at a discount.
* The DIP Agreement contemplates that DIP loans will be
extended in two pieces. The Debtors would immediately qualify for
loans of $350 million, but the Debtors will only qualify for an
additional $350 million loan if they achieve significant cost
savings in accordance with a Cost Reduction Plan that the Debtors
have adopted. The Unsecured Creditors Committee negotiated a
modification to the DIP Agreement that provides that the call
option essentially will not exist if the Debtors do not qualify for
the extra $350 million loan or if they qualify and Apollo refuses
to make the additional loan. But if the Debtors qualify for the
loan, the option will vest regardless of whether the Debtors
actually choose to borrow the additional funds.
* The proposed DIP Agreement includes so called "tag rights"
under which the DIP Lenders would have the right to buy up to 30%
of the new money equity interests to be issued under a plan of
reorganization. The DIP Lenders would have the right to buy those
equity interests on the same terms available to a third party. The
tag rights would vest immediately upon approval of the DIP
financing and would not depend on the amounts of the DIP loans that
actually are extended.
* The DIP Agreement provides that the Debtors may refuse to
allow the DIP Lenders to exercise the call option, in which case
the Debtors would be obligated to pay a call option termination
fee. If that termination fee comes due within the first 12 months
after the loan is made, then the Debtors would be required to pay
a termination fee of $19.52 million. If the termination were to be
exercised after 12 months, then the termination fee would be equal
to whatever amount would be necessary to give the DIP Lenders an
all-in rate of return of 23.2%.
* The DIP Agreement, as originally proposed, provided that the
Debtors could terminate the tag rights upon the payment of a $28
million fee. The Unsecured Creditors Committee negotiated
revisions to the DIP Agreement that include a reduction in that
proposed termination fee to $21 million instead of $28 million.
* The DIP Agreement also required the Debtors to seek approval
of a breakup fee and of expense reimbursements that would be
payable if the DIP Agreement ultimately were not approved. At a
prior hearing in August, the parties asked me to approve a breakup
fee of 1% and potential expense reimbursements of up to $1 million.
At that time, all parties urged that the Court approve the
proposed breakup fee and expense reimbursements, and the Court did
so. However, at that prior hearing the judge expressed some doubts
and raised several questions about the proposed arrangement.
Judge Wiles said, "I have doubts as to the costs and benefits, but
I am reluctant to substitute my open questions and my doubts in
place of the judgments that have been made by the parties who hold
the actual economic interests in such matters. I should not
disregard their consensus opinions unless I have something before
me that more clearly shows to me that they are wrong as to the
potential costs and benefits, and I do not have that."
About Scandinavian Airlines
SAS SAB -- https://www.sasgroup.net/ -- Scandinavia's leading
airline, with main hubs in Copenhagen, Oslo and Stockholm, flies to
destinations in Europe, USA and Asia. SAS also offers ground
handling services, technical maintenance and air cargo services.
SAS is a founder member of the Star Alliance, and together with its
partner airlines offers a wide network worldwide.
SAS AB and its affiliates, including Scandinavian Airlines Systems
Denmark-Norway-Sweden and Scandinavian Airlines of North America
Inc., sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 22-10925) on July 5, 2022. In the
petition filed by Erno Hilden, as authorized representative, the
Debtor SAS AB estimated assets between $10 billion and $50 billion
and liabilities between $1 billion and $10 billion.
Judge Michael E. Wiles oversees the case.
Weil, Gotshal & Manges LLP is serving as global legal counsel and
Mannheimer Swartling Advokatbyra AB is serving as Swedish legal
counsel to SAS. Seabury Securities LLC and Skandinaviska Enskilda
Banken AB are serving as investment bankers, Seabury is also
serving as restructuring advisor. FTI Consulting is serving as
financial advisor. Kroll Restructuring Advisors is the claims
agent.
SOTERA HEALTH: Moody's Affirms B1 CFR & Alters Outlook to Negative
------------------------------------------------------------------
Moody's Investors Service affirmed Sotera Health Holdings, LLC's B1
Corporate Family rating, B1-PD Probability of Default rating and
the B1 rating of the company's senior secured first lien credit
facilities. There is no change to the company's SGL-1 Speculative
Grade Liquidity Rating.
At the same time, Moody's changed the outlook to negative from
stable.
The rating affirmation reflects the company's solid business
performance, consistent positive free cash flow, moderately high
financial leverage and very good liquidity. It also reflects stable
long-term demand for the company's services and high barriers to
entry in the highly regulated medical device sterilization
business.
The outlook change to negative reflects the potential downside
arising from the recent Illinois court verdict against the company.
On September 19, 2022, Illinois court issued a jury verdict, which
awarded the plaintiff of the case a total of $363 million in
damages ($38 million in compensatory damages and $325 million in
punitive damages). Sotera Health has stated that it will appeal the
court's decision after it files several procedural motions with the
court.
Moody's believes that the final impact of this legal dispute is
uncertain at this time, subject to whether or not the company
succeeds in its appeal of the recent verdict. The appeal process
could take a long time to conclude (up to several years).
Nevertheless, this adverse verdict is likely to motivate other
plaintiffs to actively pursue litigation, which raises the risk of
ongoing legal expenses and negative publicity for the company.
Moody's does not anticipate material cash outflow in the short
term. However, depending on the outcome of the appeal in this case
and the verdicts in other similar cases, the company may need to
set aside funds to cover potential liabilities. Further, the impact
of this verdict on Sotera Health's enterprise value could make it
harder for the company to access capital markets and increase its
cost of capital.
Social and Environmental risks are material to the rating action.
The company is subject to personal injury and related tort lawsuits
alleging various injuries caused by low-level environmental
exposure to Ethylene Oxide emissions from its sterilization
facilities. The abovementioned adverse court verdict highlights the
social risks the company is exposed to; particularly responsible
production. The company is also exposed to risks related to waste
and pollution as it uses radioactive materials and highly toxic
chemicals to sterilize certain types of medical devices.
Affirmations:
Issuer: Sotera Health Holdings, LLC
Corporate Family Rating, affirmed at B1
Probability of Default Rating, affirmed at B1-PD
$1.763 Billion Senior Secured First Lien Term Loan Rating,
affirmed at B1 (LGD3)
$347 Million Senior Secured First Lien Revolver Rating, affirmed
at B1 (LGD3)
Outlook Actions:
Issuer: Sotera Health Holdings, LLC
Outlook, Changed To Negative From Stable
RATINGS RATIONALE
Sotera Health's B1 rating reflects its moderately high leverage and
exposure to the device sterilization industry and the significant
environmental risks arising from the handling of toxic gases in its
manufacturing process. Sotera Health has a concentrated supply
chain with limited providers of key chemicals. Moody's estimates
that the company's financial leverage was around 4.2 times at the
end of June 2022.
Sotera Health's CFR is supported by its leading position in the
contract sterilization outsourcing market and the significant
barriers to entry and meaningful customer switching costs. The
company is reducing its reliance on device sterilization through
acquisitions into new categories, such as the lab services sector.
The company's profile also reflects its breadth of operations with
no meaningful customer concentrations, earnings growth, a global
footprint and a very good liquidity profile. Moody's expects Sotera
Health will maintain balanced financial policies as a public
company with an articulated leverage target of achieving net
debt/EBITDA of 2 to 4 times.
Sotera Health's liquidity is very good and is supported by Moody's
expectation of $100-$150 million in annual free cash flow, $140
million in cash and approximately $277 million available to draw
under the company's $347 million revolver as of June 30, 2022. The
company no mandatory annual amortization of its first lien term
loan.
The negative outlook reflects the potential for material
litigation-related cash outflows that constrain Sotera Health's
free cash flow and credit profile.
Sotera Health's revolving credit facility and term loan are both
rated B1, at the same level as the company's corporate family
rating reflecting the fact that the two together comprise
substantially all debt in the company's capital structure.
ESG considerations are material to the company's rating given the
substantial implications for the environment and public health and
safety. Sotera Health's ESG credit impact score is highly
negative (CIS 4), reflecting very highly negative exposure to
social considerations related to responsible production and highly
negative environmental considerations related to waste and
pollution. Sotera Health has highly negative credit exposure to
environmental considerations (E-4). The company has elevated risks
related to waste and pollution as it uses radioactive materials and
highly toxic chemicals to sterilize certain types of medical
devices. These activities are subject to extensive regulation in
the US by the Food and Drug Administration and the Environmental
Protection Agency. Sotera Health has very highly negative credit
exposure to social considerations (S-5). The main risk is the
company's very highly negative exposure to responsible production.
The company is subject to personal injury and related tort lawsuits
alleging various injuries caused by low-level environmental
exposure to Ethylene Oxide emissions from its sterilization
facilities. The company is currently a defendant in a number of
individual lawsuits, which have not been classified as class action
in Illinois and Georgia.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Ratings could be upgraded if the company continues to demonstrate
balanced financial policies and improve its credit metrics. The
company would also need to keep costs related to legal and
environmental risks well-contained. An upgrade will require clarity
on the most likely outcome for the pending lawsuits.
Quantitatively, ratings could be upgraded if debt/EBITDA is
sustained below 4.5 times.
Ratings could be downgraded if the company loses its appeal against
the recent court ruling and/or if it loses additional similar court
cases in the coming months/years. The rating could also be
downgraded if the company's liquidity weakens, financial policies
become more aggressive or if legal and environmental risks increase
substantially. Quantitively, ratings could be downgraded if
debt/EBITDA was sustained above 5.5 times.
Sotera Health, headquartered near Cleveland, OH, is a leading fully
integrated provider of mission-critical health sciences, lab
services and sterilization solutions for the healthcare industry.
Sotera Health offers services in sterilization, lab and testing and
gamma technologies. It operates through three main entities:
Sterigenics, Nelson Labs and Nordion Inc. The company generated
approximately $971 million in revenues in the twelve months that
ended June 2022. Sotera Health's parent Sotera Health Company is
publicly traded however private equity firms Warburg Pincus
International LLC and GTCR LLC continue to hold approximately 62%
of the outstanding shares.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
SPARTAN POOLS: Taps Larson & Zirzow as Legal Counsel
----------------------------------------------------
Spartan Pools, LLC seeks approval from the U.S. Bankruptcy Court
for the District of Nevada to hire Larson & Zirzow, LLC as its
bankruptcy counsel.
The firm will render these legal services:
(a) prepare legal papers;
(b) take all necessary or appropriate actions in connection
with a plan of reorganization and the administration of the
Debtor's estate;
(c) take all necessary actions to protect and preserve the
Debtor's estate; and
(d) perform all other necessary legal services in connection
with the prosecution of the Chapter 11 case.
Prior to the petition date, the firm received a total sum of
$18,494 from the Debtor for pre-bankruptcy services.
The hourly rates of the firm's counsel and staff are as follows:
Zachariah Larson, Attorney $600
Patricia Huelsman, Paralegal $220
In addition, the firm will seek reimbursement for expenses
incurred.
Matthew Zirzow, Esq., an attorney at Larson & Zirzow, disclosed in
a court filing that the firm is a "disinterested person" as that
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Zachariah Larson, Esq.
Larson & Zirzow, LLC
850 E. Bonneville Ave.
Las Vegas, NE 89101
Telephone: (702) 382-1170
Facsimile: (702) 382-1169
Email: zlarson@lzlawnv.com
About Spartan Pools
Spartan Pools, LLC, a Las Vegas-based swimming pool contractor,
filed a petition under Chapter 11, Subchapter V of the Bankruptcy
Code (Bankr. D. Nev. Case No. 22-13244) on Sept. 9, 2022, with up
to $1 million in both assets and liabilities. Brian Shapiro serves
as Subchapter V trustee.
Judge Natalie M. Cox oversees the case.
The Debtor is represented by Zachariah Larson, Esq., at Larson &
Zirzow, LLC.
SPARTAN POOLS: Wins Cash Collateral Access Thru Nov 1
-----------------------------------------------------
The U.S. Bankruptcy Court for the District of Nevada authorized
Spartan Pools LLC to use cash collateral on an emergency, interim
basis through the date of the final hearing set for November 1,
2022, at 9:30 a.m.
The Debtor is permitted to a) maintain its Cash Management System
and continue to use its Bank Accounts for all purposes as debtor in
possession accounts; b) use, in their present form, existing checks
and other documents related to the Bank Accounts; c) pay
post-petition ordinary course bank fees in connection with the Bank
Accounts; and d) perform their obligations under the documents and
agreements governing the Bank Accounts. The Debtor will seek to
have its Bank Accounts at Wells Fargo Bank either designated as
appropriate debtor in possession accounts prior to the Final
Hearing, or close the accounts and/or have new proper debtor in
possession accounts at an authorized depository opened as necessary
prior to the Final Hearing.
The Debtor is also directed to keep and maintain detailed records
of all post-petition deposits and payments from its Bank Accounts,
so that the Court and creditors may have the same kind of
information about pre-petition versus post-petition activity they
would have if the debtor were using debtor in possession accounts.
A copy of the order is available at https://bit.ly/3UMOcBR from
PacerMonitor.com.
About Spartan Pools LLC
Spartan Pools LLC sought protection from the U.S. Bankruptcy Code
(Bankr. D. Nev. Case No. 22-13244-nmc) on September 9, 2022. In
the petition signed by Carlos Tapia, manager, the Debtor disclosed
up to $1 million in both assets and liabilities.
Zachariah Larson, Esq., at Larson & Zirzow, LLC is the Debtor's
counsel.
STIMWAVE TECHNOLOGY: Director Urges Probe Before Sale to Kennedy
----------------------------------------------------------------
A Stimwave Technology Inc. director urged a bankruptcy judge in
Delaware Thursday to require a "look back" at the medical device
company's top lender and prospective buyer's conduct before
approving a sale of the business.
Gary Perryman says that in light of the DIP financing obtained by
the Debtor, a full investigation of the Debtor should take place in
order to review evidence and discovery into actions of self-dealing
members and lender and buyer Kennedy Lewis before the assets are
sold.
According to Mr. Perryman, when Kennedy Lewis took control [of the
Debtor's board and executives] in November 2019, the Debtor did not
have financial problems, had $10 million in cash in the bank, and
had offered to close out the loan with Kennedy Lewis. At the
behest of Kennedy Lewis, the Debtor was sent to Chapter 11
bankruptcy, and Kennedy Lewis intends to acquire the business via a
credit bid.
"Respondent opposes the Sale Order as being predicated by fraud,
self-dealing by certain members of the Debtors' board and
executives, insider manipulation by the Stalking Horse Lender
Kennedy Lewis to force the Debtor into a bankruptcy under the
threat of foreclosure on terms that were usuary, exclusion of
insider status as Debtor board members by Kennedy Lewis
representatives David Kho and Richard Gumar, exclusion of
stockholders from the decision to file for bankruptcy,
intermingling of funds from the Debtor paying for the Lender legal
team, collusion with the mebmers of the sub-committee of the
Executive Committee of the Board," Mr. Perryman stated in court
filings.
About Stimwave Technologies
Stimwave Technologies Incorporated is a privately-held medical
device company engaged in the development, manufacture,
commercialization and marketing of wireless microsize injectable
medical devices for neurology markets.
Stimwave Technologies Incorporated and affiliate Stimwave LLC
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. D. Del. Case No. 22-10541) on June 15, 2022.
In the petition filed by CEO Aure Bruneau, Stimwave Technologies
estimated assets between $50 million and $100 million and
liabilities between $10 million and $50 million.
YOUNG CONAWAY STARGATT & TAYLOR, LLP, and GIBSON, DUNN & CRUTCHER
LLP serve as the Debtor's counsel. RIVERON RTS, LLC, is the
financial advisor; and GLC ADVISORS & CO., LLC is the investment
banker. HONIGMAN LLP and JONES DAY serve as the special counsel.
KROLL RESTRUCTURING ADMINISTRATION is the claims agent.
STREAM TV: Chancery Mulls Post-Appeal of Overturned Order
---------------------------------------------------------
Jeff Montgomery of Law360 reports that a Delaware Chancery Court's
effort to unwind an overturned order that handed the assets of 3D
TV venture Stream TV Networks to its creditors last 2021 edged
forward Wednesday, September 21, 2022, amid concerns that the
result could become a costly and vexing round trip.
About Stream TV Networks
Philadelphia, Pa.-based Stream TV Networks, Inc. develops
technology intended to display three-dimensional content without
the use of 3D glasses.
On Feb. 24, 2021, Stream TV Networks filed a Chapter 11 petition
(Bankr. D. Del. Case No. 21-10433). Stream TV Networks CEO Mathu
Rajan signed the petition. In the petition, the Debtor listed
assets of about $100 million to $500 million and liabilities of
$100 million to $500 million. Judge Karen B. Owens oversees the
case. Dilworth Paxson, LLP, led by Martin J. Weis, Esq., is the
Debtor's counsel.
The Company's Chapter 11 case was dismissed on May 17, 2021.
Stream TV Networks filed a Chapter 7 bankruptcy petition (Banr. D.
Del. Case No. 21-bk-10848) on May 23, 2021, which case was
dismissed June 10, 2021.
TPC GROUP: Exit Plan Vote Okayed Pending Liability Term Change
--------------------------------------------------------------
Alex Wolf of Bloomberg Law reports that TPC Group Inc., a bankrupt
chemical maker, won preliminary court approval to seek creditor
votes on its Chapter 11 plan, but was denied a bid to ban unsecured
creditors who support the plan from suing related third parties in
the future.
Most of the unsecured creditors in TPC's bankruptcy case hold
claims related to a November 2019 explosion at a plant in Port
Neches, Texas. The company must give them the clear option to opt
out of liability release provisions in its Chapter 11 plan whether
or not they vote to accept the deal's proposed terms, Judge Craig
T. Goldblatt ruled.
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, Arshtn
& 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.
Pachulski Stang Ziehl & Jones LLP, Proskauer Rose LLP, and Selendy
Gay Elsberg PLLC are serving as counsel to an Ad Hoc Group of
Non-Consenting Noteholders, led by Bayside Capital, Inc., and
Cerberus Capital Management, L.P. Milbank LLP previously served as
the group's counsel but was later replaced by Pachulski and SGE.
VASU CONVENIENCE: Exclusivity Period Extended to Dec. 28
--------------------------------------------------------
Vasu Convenience, Inc. obtained a court order extending its
exclusive right to file a Chapter 11 plan of reorganization to Dec.
28 from Sept. 29.
The ruling by Judge Nancy Hershey Lord of the U.S. Bankruptcy Court
for the Eastern District of New York allows the company to pursue
its own plan for emerging from Chapter 11 protection without the
threat of a rival plan from creditors.
Vasu Convenience will use the extension to complete negotiations
with its landlord, draft a settlement agreement, and file a plan
incorporating the settlement terms reached with the landlord.
About Vasu Convenience
Vasu Convenience, Inc. filed a petition for Chapter 11 protection
(Bankr. E.D. N.Y. Case No. 21-43023) on Dec. 3, 2021, listing up to
$100,000 in assets and up to $500,000 in liabilities. Jigar A.
Patel, president, signed the petition.
Judge Nancy Hershey Lord oversees the case.
The Debtor tapped the Law Offices of Alla Kachan, P.C. and Wisdom
Professional Services Inc. as its legal counsel and accountant,
respectively.
VITEC ELECTRONICS: Seeks to Hire Curry Advisors as Legal Counsel
----------------------------------------------------------------
Vitec Electronics Corporation seeks approval from the U.S.
Bankruptcy Court for the Southern District of California to employ
Curry Advisors, A Professional Law Corporation as its bankruptcy
counsel.
The firm will render these services:
(a) advise, consult with, and assist the Debtor with regard to
evaluating prospects for reorganization;
(b) advise, consult with, and otherwise represent the Debtor
concerning preparation of the schedules, statement of financial
affairs, and other papers that must be filed in the case, and
compliance with the U.S. trustee operating and reporting
requirements;
(c) advise and consult with the Debtor concerning various
legal matters that may arise during the course of its Chapter 11
proceedings, including the rights and remedies of the Debtor with
respect to the assets of the estate;
(d) advise, consult with, and represent the Debtor regarding
possible suits and proceedings arising out of or relating to the
case and relating to assets of the estate;
(e) represent the Debtor in hearings before the court and
prepare appropriate applications and orders;
(f) advise the Debtor concerning its powers, duties, rights
and obligations, assist in the protection of the assets of the
estate, and prepare legal documents; and
(g) advise, consult with, and represent the Debtor in
connection with such other general, real estate, contract,
business, or litigation matters as may be necessary for the
duration of its bankruptcy case.
Curry Advisors will render services to the Debtor at an initial
hourly rate of $510. The firm received a pre-bankruptcy retainer in
the amount of $35,000.
As disclosed in court filings, Curry Advisors is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
The firm can be reached through:
K. Todd Curry, Esq.
Curry Advisors
A Professional Law Corporation
185 West F Street, Suite 100
San Diego, CA 92101
Tel: 619-238-0004
Fax: 619-238-0006
Email: tcurry@currylegal.com
About Vitec Electronics Corporation
Vitec Electronics Corporation is an electrical supply store in
Carlsbad, Calif. It designs and manufactures pulse, control, and
interface transformers, power inductors, and PFC chokes.
Vitec Electronics filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Cal. Case No.
22-02205) on Aug. 23, 2022, with between $1 million and $10 million
in both assets and liabilities. Barbara R. Gross has been appointed
as Subchapter V trustee.
Judge Christopher B. Latham oversees the case.
The Debtor is represented by K. Todd Curry of Curry Advisors, A
Prof. Law Corp.
VOYAGER DIGITAL: Investor Objects to Bankruptcy Plan Disclosures
----------------------------------------------------------------
Daniel Gill of Bloomberg Law reports that a cryptocurrency buyer
suing over Voyager Digital Holdings Inc.'s marketing urged a
bankruptcy court to deny the digital asset brokerage's proposed
Chapter 11 plan disclosures because they lack "the most basic
information."
Voyager's August disclosure statement -- which must be approved
before creditors can vote on the proposed plan -- lacks proper
financial analysis and creditor payout information, the platform
user, Pierce Robertson, said Wednesday in a filing in the US
Bankruptcy Court for the Southern District of New York.
Robertson is the lead plaintiff in a proposed class action against
CEO Stephen Ehrlich, as well as the Dallas Mavericks and its
owner.
About Voyager Digital Holdings
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.
WALKING COMPANY: Sued By Simon Property Over $4.4 Million Judgment
------------------------------------------------------------------
Leslie A. Pappas of Law360 reports that mall landlord Simon
Property Group LP is seeking $4.4 million in unpaid rent and other
charges that a Delaware Superior Court judge ordered The Walking
Company to pay in 2021, suing the footwear retailer and several
affiliates on Wednesday, September 21, 2022, in Delaware Chancery
Court.
About The Walking Company
The Walking Company is the leading national specialty retailer of
high-quality, technically designed comfort footwear and
accessories, and offers a selection of premium comfort brands
including ABEO, Dansko, ECCO, Taos, and more. The Walking Company
operates 208 stores in premium malls across the nation and the
company's Web site http://www.thewalkingcompany.com/
On March 6, 2018, The Walking Company Holdings, Inc., along with
affiliates The Walking Company, Big Dog USA, Inc., and FootStmart,
Inc., filed voluntary petitions for relief under Chapter 11 of the
United States Bankruptcy Code (Bankr. D. Del. Lead Case No.
18-10474). The cases are pending joint administration before the
Honorable Laurie Selber Silverstein.
Pachulski Stang Ziehl & Jones LLP is the Debtors' counsel.
Consensus Advisory Services LLC is the financial advisor. Kurtzman
Carson Consultants LLC is the claims and noticing agent.
Choate, Hall & Stewart LLP, led by Kevin J. Simard, Esq., and
Womble Bond Dickinson, led by Matthew P. Ward, Esq., serve as
counsel to the DIP Agent, DIP Term Agent, the Prepetition Senior
Agent, and the Prepetition Term Agent.
Irell & Manella LLP, led by Jeffrey M. Reisner, Esq., is counsel to
the Prepetition Subordinated Creditors.
WC BRAKER PORTFOLIO B: Case Summary & Two Unsecured Creditors
-------------------------------------------------------------
Debtor: WC Braker Portfolio B, LLC
814 Lavaca Street
Austin, TX 78701
Chapter 11 Petition Date: September 29, 2022
Court: United States Bankruptcy Court
Western District of Texas
Case No.: 22-10628
Judge: Hon. Tony M. Davis
Debtor's Counsel: Todd Headden, Esq.
HAYWARD PLLC
901 Mopac Expressway
Building 1, Suite 300
Austin, TX 78746
Tel: 737-881-7100
Email: theadden@haywardfirm.com
Estimated Assets: $100 million to $500 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Natin Paul as authorized signatory.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/FCWBISQ/WC_Braker_Portfolio_B_LLC__txwbke-22-10628__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
------ --------------- ------------
1. Julia Clark & $0
Associates, P.C.
1700 West Avenue
Austin, TX 78717
2. Texas Comptroller Unknown
of Public Accounts
P.O. Box 13528,
Capitol Station
Austin, TX
78711-3528
WILLIAM HOLDINGS: Taps Michael Jay Berger as Bankruptcy Counsel
---------------------------------------------------------------
William Holdings, LLC seeks approval from the U.S. Bankruptcy Court
for the Central District of California to hire the Law Offices of
Michael Jay Berger as its bankruptcy counsel.
The firm's services include:
(a) assisting the Debtor in drafting its bankruptcy schedules,
statement of financial affairs, and other necessary documents;
(b) assisting the Debtor in complying the requirements of the
Office of the U.S. Trustee;
(c) communicating with creditors to explain the facts and
circumstances surrounding the case, investigate possible claims
against the Debtor, and gain its cooperation with regards to the
continued business of the Debtor;
(d) performing other necessary legal services.
The hourly rates of the firm's attorneys and staff are as follows:
Michael Jay Berger, Esq. $595
Sofya Davtyan, Senior Associate Attorney $545
Debra Reed, Mid-level Associate Attorney $435
Carolyn M. Afari, Mid-level Associate Attorney $435
Robert Poteete, Mid-level Associate Attorney $435
Gary Baddin, Bankruptcy Analyst/Field Agent $275
Senior Paralegals and Law Clerks $250
Bankruptcy Paralegals $200
The Debtor paid the firm $20,000 retainer, plus Chapter 11 filing
fee of $1,738.
Michael Jay Berger, Esq., the sole owner of the Law Offices of
Michael Jay Berger, 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:
Michael Jay Berger, Esq.
Law Offices of Michael Jay Berger
9454 Wilshire Blvd., 6th Floor
Beverly Hills, CA 90212-2929
Telephone: (310) 271-6223
Facsimile: (310) 271-9805
Email: michael.berger@bankruptcypower.com
About William Holdings
Los Angeles-based William Holdings, LLC sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. C.D. Calif. Case No.
22-14708) on Aug. 29, 3033, with between $10 million and $50
million in both assets and liabilities. Kameron Segal, chief
executive officer, signed the petition.
Judge Deborah J. Saltzman oversees the case.
The Debtor is represented by the Law Offices of Michael Jay Berger.
WOODFORD EXPRESS: Moody's Withdraws B3 CFR on Term Loan Repayment
-----------------------------------------------------------------
Moody's Investors Service withdrew all of Woodford Express, LLC's
("WEX") ratings, including its B3 Corporate Family Rating, B3-PD
Probability of Default Rating and B3 senior secured bank credit
facility rating. The outlook was changed to ratings withdrawn from
rating under review. These withdrawals follow repayment of the term
loan in conjunction with the closing of the acquisition of WEX by
Energy Transfer LP (ET, Baa3 stable).
Withdrawals:
Issuer: Woodford Express, LLC
Corporate Family Rating, Withdrawn, previously rated B3,
rating under review for upgrade
Probability of Default Rating, Withdrawn, previously rated B3-PD,
rating under review for upgrade
Senior Secured Term Loan B, Withdrawn, previously rated B3
(LGD4),
rating under review for upgrade
Outlook Actions:
Issuer: Woodford Express, LLC
Outlook, Changed To Rating Withdrawn From Rating Under Review
RATINGS RATIONALE
WEX has fully repaid its senior secured term loan ($292 million
outstanding as of September 2022) in conjunction with the closing
of the acquisition of WEX by ET. All of WEX's ratings have been
withdrawn since all of its rated debt is no longer outstanding.
Woodford Express, LLC is the owner of a natural gas gathering and
processing system located in the core South Central Oklahoma Oil
Province (SCOOP) play. It is now a wholly-owned by Energy Transfer
LP, which is headquartered in Dallas, Texas, and owns and operates
a broad array of midstream energy assets.
ZEKELMAN INDUSTRIES: S&P Alters Outlook to Pos., Affirms 'BB' ICR
-----------------------------------------------------------------
S&P Global Ratings revised its outlook on Zekelman Industries Inc.
(Zekelman) to positive from stable and affirmed its 'BB' issuer
credit rating on the company. The issue-level and recovery ratings
are unchanged.
The positive outlook reflects the potential for an upgrade within
the next 12 months if the company maintains a conservative
financial policy as it continues to execute its Z-Modular agenda
and other internal growth initiatives.
Earnings, strong cash flows, and lower debt should drive Zekelman's
leverage below 1x in fiscal years 2022 and 2023.
The company is on track to deliver earnings of about $1.2
billion-$1.3 billion in fiscal 2022, which represents an 11%-20%
increase above fiscal 2021. Zekelman's earnings have expanded
considerably in the past 18-24 months on the back of record steel
prices and resilient demand. Hot rolled coil (HRC) prices have
soared close to $2,000 per short ton (/st) within the past 12
months but have recently retreated close to $800/st, which is still
33% above the five-year historical average of about $600/st.
Zekelman is able to pass through HRC costs to its customers and
because of the temporary differences between inventory costs and
current sale prices, margins can expand significantly during
periods of rapidly rising steel prices. In addition, S&P expects
net debt below $1 billion as cash flow generation improves in the
last quarter of fiscal 2022. The combination of strong earnings and
lower net debt should drive leverage below 1x in fiscal 2022. Even
if earnings and margins decline in 2023 from lower HRC prices,
lower capital expenditure and a release of funds from working
capital should improve operating cash flows, support lower net debt
and provide some cushion in its credit metrics to absorb some
market volatility. Moreover, our rating incorporates risks from the
company's growth strategy during a record-setting rebound in this
cyclical industry, as well as financial policies that should reduce
debt usage over the next few years.
Moderate shareholder distributions allow for the use of internally
generated funds to finance various expansion projects.
Despite almost doubling its earnings in 2021, shareholder
distributions increased by only 24% to $53 million. S&P said, "We
assume shareholder distributions will rise by 13% in 2022 as
management has committed to continue reinvesting excess cash in the
Z-Modular real estate business and other expansion projects. Hence,
we do not expect a significant reduction in gross debt beyond the
mandatory amortizations, given the high capital requirement for the
Z-Modular business, which involves the construction of various
multifamily housing units for rent and sale."
Zekelman continues to strengthen its business risk profile through
growth projects and modernization of its assets.
In May 2022, the company commissioned the world's largest electric
resistance mill in Blytheville, Ark. The new $150 million facility,
the first of its kind in the U.S., produces jumbo hollow structural
sections. Zekelman also expects full production to begin in January
2023 at its newest state-of-the-art facility in Rochelle, IL. The
facility will produce galvanized products for the electrical,
fence, and renewable energy markets, with capacity exceeding
400,000 short tons annually. The technology installed at the
facility is expected to improve productivity and quality. S&P
believes these two facilities will enhance the company's asset
quality, reduce costs, and enhance the future earnings profile.
Z-Modular will also improve the company's diversification once
Zekelman completes the construction and rental/sale of a
significant number of units under construction in Arizona and
Texas.
The positive outlook reflects the potential for a higher rating
within the next 12 months if the company adheres to a conservative
financial policy as it continues to execute its Z-Modular expansion
and other internal growth initiatives. S&P said, "Although earnings
should materially decline over the next year given the sharp drop
in HRC prices, we anticipate stronger cash flow generation because
of the countercyclical nature of Zekelman's business as the company
releases funds from working capital in periods of low HRC prices.
We expect leverage will remain below 1x over the next 12 months."
S&P said, "We could raise our ratings on Zekelman if the company
continues to develop the Z-Modular business and other asset
improvement initiatives with a track record of holding leverage
below 1.5x. In such a scenario, we would expect low debt leverage
for several quarters backed by management's commitment to maintain
such leverage. We would also expect sustained double-digit margins
and returns to confirm improved business strength.
"We could revise the outlook to stable on Zekelman if leverage
exceeds 2x in a moderating HRC price market. We could also revise
the outlook to stable if the company issues more debt to accelerate
the progress of the Z-Modular business or undertakes a
significantly large acquisition without a quick path to
deleveraging."
ESG credit indicators: E-2, S-2, G-2
S&P said, "Environmental factors have an overall neutral influence
on our credit rating analysis of Zekelman. The company is a
manufacturer of industrial steel tube and pipes and is not directly
involved in the steel production process. Zekelman's manufacturing
processes involve lesser energy intensity and greenhouse gas
emissions compared with those of basic batch annealing furnace
steel producers. Therefore, we assess the environmental risk for
Zekelman as lower than that for basic oxygen furnace steel
producers."
[*] A&G Accepts Offers on Nine Medical Office Properties
--------------------------------------------------------
A&G Real Estate Partners is now accepting offers on nine medical
office properties in northern New Jersey and one each in Mount
Kisco, New York, and Miramar, Florida.
Prospective buyers can purchase individual assets or acquire all 11
properties. Alternately, the current owner -- a medical doctor who
built the portfolio over the last 10 years -- would consider a
joint venture.
All offers must be submitted by October 18.
"The owner has signed several new tenants recently and enjoys good
working relationships with the rest," noted A&G Co-President Emilio
Amendola, who heads the New York-based firm's real estate sales
division.
"The portfolio, which has been historically under-managed because
of cash-flow disruptions, is now primarily stabilized while still
offering significant upside on several of the buildings,"
Mr. Amendola said. "With reinvestment capital and professional
approaches to leasing and management, buyers of any of these
properties could achieve a healthy return on their investment."
The New Jersey properties are in Oradell, Carlstadt, Hackensack,
Jersey City, Glen Rock, Roseland and New Brunswick, along with two
buildings in Fair Lawn.
The average building size, including assets in Mount Kisco, NY, and
Miramar, FL. is about 27,000 square feet.
"Current tenants include labs, dental practices, business offices
and regional surgery centers. New leases have just been signed that
will increase revenue by more than $1 million," Mr. Amendola said.
The 310,290-square-foot portfolio is 82 percent leased, with
12-month projected net operating income of approximately $5.5
million. Net Incomes on an individual property basis range from
$150,000 to over $1,250,000 per year.
All 11 properties are in dense, well-populated markets with easy
access to nearby hospitals and specialty clinics. For example, the
12,660-square-foot medical office building at 215 Easton Ave. in
New Brunswick is across the street from Saint Peter's University
Hospital and serves as the cancer treatment center for this
regional medical center.
The 72,715-square-foot medical office at 103-105 South Bedford Rd.
in Mount Kisco is a quarter of a mile from Northwell Health's
Northern Westchester Hospital—a highly developed area with a high
barrier to entry for new competitors.
To submit offers and for further information, visit
http://www.agrep-sales.com/medicalofficeor contact Emilio
Amendola, (631) 465-9507, emilio@agrep.com; Jamie Cote, (312)
203-6321, jcote@agrep.com; Katie Decoste, (773) 615-1292,
kdecoste@agrep.com; or Christian Koulichkov, (617) 335-3940,
ckoulichkov@agrep.com.
[*] BCLP Lawyer Comments on Rising Property Market Interest Rates
-----------------------------------------------------------------
Just as certain sectors of the commercial real estate market showed
signs of recovering from the depths of the pandemic, rising
interest rates aimed at taming inflation have had a chilling effect
on the property market -- and it could get worse.
Commercial property operators that have loans maturing now and
possibly over the next couple of years could be looking at interest
rates close to double to what they have on their current loans,
according to Bob Stupar, a real estate finance partner with Bryan
Cave Leighton Paisner. "Many commercial real estate loans have 5 to
10 year terms, which means that loans maturing now were originated
in an interest rate environment much different from the one today,"
he notes.
Mr. Stupar also notes other impacts of the changing interest rate
environment: Rising interest rates combined with low occupancy in
some asset classes, like the office sector, spells trouble for many
commercial real estate operators. Trouble for commercial real
estate operators means turbulence for their current lenders since
their loans may not be paid off in full at maturity. Office
building loan collateral is especially problematic -- office use in
the U.S. has changged significantly since the pandemic started and
buildings are experiencing dramatic reductions in occupancy as a
result of tenants reducing their office footprints. This has caused
a decline in revenue for those operators, which in turn has
impacted their ability to service their debts and find refinancing
as their loans mature.
As the above scenarios unfold, Stupar says that lenders will face
tough choices -- either restructure debt to give borrowers "more
rope" to stay afloat until the interest rate environment improves,
or move to cut their losses early and exercise foreclosure and
other remedies to realize on their collateral before things
potentially get worse.
Mr. Stupar also says some operators have pursued creative solutions
for dealing with high office vacancies, such as converting office
buildings to apartments. Although he notes that it is a strategy
that will be viable for only a limited number of assets and top
locations due to the high cost of execution. Plus, if successful,
it may fuel what some see as a multifamily bubble.
The multifamily sector "which has been the darling of the
commercial real estate sector" cannot escape the impact of
inflation, according to Mr. Stupar. "This asset class has been
buoyed by low interest rates and exceptionally high year-over-year
rent increases, but as inflation bites further into disposable
income of tenants and their wage growth does not keep up with the
constant rent increases, there could be trouble even in this
sector," he says.
Mr. Stupar concentrates his practice on lending and servicing of
commercial real estate conduit and balance-sheet loans secured by
all types of commercial real estate. He regularly represents banks,
master servicers, special servicers, CLO issuers, CMBS trusts,
insurance companies, and other lenders with respect to commercial
real estate loan originations, loan restructurings, loan
modifications, loan assumptions, CMBS and CLO securitization
compliance, SASB loan servicing, co-lender, loan participant and
intercreditor issues, property leasing, property management,
zoning, land use, workouts of non-performing commercial real estate
loans (forbearances, discounted payoffs, deeds-in-lieu, note sales,
receiverships, foreclosures, and the exercise of other secured
creditor remedies), and real estate sales.
Mr. Stupar has significant experience with distressed properties
and recently represented a senior lender in a workout of a
defaulted $1.1 billion loan secured by a hotel.
[^] BOOK REVIEW: Performance Evaluation of Hedge Funds
------------------------------------------------------
Performance Evaluation of Hedge Funds: A Quantitative Approach
Edited by Greg N. Gregoriou, Fabrice Rouah, and Komlan Sedzro
Publisher: Beard Books
Hardcover: 203 pages
List price: $59.95
Review by Henry Berry
Order your copy at https://bit.ly/3yPU9oz
Hedge funds can be traced back to 1949 when Alfred Winslow Jones
formed the first one to "hedge" his investments in the stock market
by betting that some stocks would go up and others down. However,
it has only been within the past decade that hedge funds have
exploded in growth. The rise of global markets and the
uncertainties that have arisen from the valuation of different
currencies have given a boost to hedge funds. In 1998, there were
approximately 3,500 hedge funds, managing capital of about $150
billion. By mid-2006, 9,000 hedge funds were managing $1.2
trillion in assets.
Despite their growing prominence in the investment community, hedge
funds are only vaguely understood by most people. Performance
Evaluation of Hedge Funds addresses this shortcoming. The book
describes the structure, workings, purpose, and goals of hedge
funds. While hedge funds are loosely defined as "funds with no
rules," the editors define these funds more usefully as "privately
pooled investments, usually structured as a partnership between the
fund managers and the investors." The authors then expand upon
this definition by explaining what sorts of investments hedge funds
are, the work of the managers, and the reasons investors join a
hedge fund and what they are looking for in doing so.
For example, hedge funds are characterized as an "important avenue
for investors opting to diversify their traditional portfolios and
better control risk" -- an apt characterization considering their
tremendous growth over the last decade. The qualifications to join
a hedge fund generally include a net worth in excess of $1 million;
thus, funds are for high net-worth individuals and institutional
investors such as foundations, life insurance companies,
endowments, and investment banks. However, there are many
individuals with net worth below $1 million that take part in hedge
funds by pooling funds in financial entities that are then eligible
for a hedge fund.
This book discusses why hedge funds have become "notorious as
speculating vehicles," in part because of highly publicized
incidents, both pro and con. For example, George Soros made $1
billion in 1992 by betting against the British pound. Conversely,
the hedge fund Long-Term Capital Management (LTCP) imploded in
1998, with losses totaling $4.6 billion. Nonetheless, these are
the exceptions rather than the rule, and the editors offer
statistics, studies, and other research showing that the
"volatility of hedge funds is closer to that of bonds than mutual
funds or equities."
After clarifying what hedge funds are and are not, the book
explains how to analyze hedge fund performance and select a
successful hedge fund. It is here that the book has its greatest
utility, and the text is supplemented with graphs, tables, and
formulas.
The analysis makes one thing clear: for some investors, hedge funds
are an investment worth considering. Most have a demonstrable
record of investment performance and the risk is low, contrary to
common perception. Investors who have the necessary capital to
invest in a hedge fund or readers who aspire to join that select
club will want to absorb the research, information, analyses,
commentary, and guidance of this unique book.
Greg N. Gregoriou (1956–2018) was a professor of finance and a
native of Montreal, Quebec, Canada. He received his joint Ph. D.
in 2004 with a specialization in the area of finance from the
University of Quebec at Montreal, Canada. He taught at U.S. and
Canadian universities and did research for large corporations.
Fabrice Douglas Rouah is a Director with Sapient Global Markets and
is based in New York City. He specializes in financial risk
management and is the co-author and co-editor of several books.
Komlan Sedzro, Ph. D., is the Dean of the School of Management,
University of Quebec in Montreal. He has been a professor in the
Department of Finance at ESG UQAM since 1997. He holds a master’s
degree in business economics from the University of Clermont in
France and a doctorate in Business Administration (Finance and
Insurance) from Laval University.
*********
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