/raid1/www/Hosts/bankrupt/TCR_Public/221031.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, October 31, 2022, Vol. 26, No. 303
Headlines
839 E MINORKA: Claims to be Paid From Sale of Property
A.B.C. OF NORTH PALM BEACH: Court Confirms Plan of Liquidation
ACCO BRANDS: Egan-Jones Retains B+ Senior Unsecured Ratings
ADT SECURITY: Egan-Jones Retains B- Senior Unsecured Ratings
ADVISOR GROUP: Fitch Affirms 'B-' LongTerm IDR, Outlook Stable
AEARO TECHNOLOGIES: 3M Urges 11th Circ. to Overturn Earplug Verdict
AES CORP: Egan-Jones Retains BB Senior Unsecured Ratings
AIR CANADA: Egan-Jones Lowers Senior Unsecured Ratings to CCC-
B&G FOODS: Egan-Jones Retains B Senior Unsecured Ratings
BACKYARD WORKROOM: Seeks to Tap Eric A. Liepins as Legal Counsel
BARNSTORM RESOURCES: Granted 4-Month Extension to File Exit Plan
BELLA VENEZIA: Exclusivity Period Extended to Jan. 7
BERWICK HOSPITAL: Seeks to Hire Robert Bassel as Bankruptcy Counsel
BIOMARIN PHARMACEUTICAL: Egan-Jones Retains BB- Sr. Unsec. Ratings
BLT RESTAURANT: Amends Unsecureds & JL Holdings Secured Claim Pay
BLUCORA INC: Egan-Jones Retains B+ Senior Unsecured Ratings
BRAZOS ELECTRIC: Law Firm of Russell Represents Utility Companies
BRAZOS ELECTRIC: Sussman & Moore Represents Utility Companies
BRINK'S CO: Egan-Jones Retains B+ Senior Unsecured Ratings
CANADIAN UTILITIES: Egan-Jones Retains B Senior Unsecured Ratings
CELSIUS NETWORK: Court Approves Chapter 11 Auction
CENTURY ALUMINUM: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
CEREMONY SALON: Court Denies Conditional Approval of Disclosures
CHART INDUSTRIES: Egan-Jones Retains BB+ Senior Unsecured Ratings
CINEMARK HOLDINGS: Egan-Jones Retains CC Senior Unsecured Ratings
CITE LLC: Trustee's $4.68MM Sale of All Assets to Lake Point OK'd
CITIZEN PROTECTION: Seeks 45-Day Extension to File Plan
CITRIX SYSTEMS: Egan-Jones Retains BB+ Senior Unsecured Ratings
CM WIND: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
COEUR MINING: Egan-Jones Retains BB- Senior Unsecured Ratings
COEUR MINING: S&P Alters Outlook to Neg., Affirms 'B' ICR
COGENT COMMUNICATIONS: Egan-Jones Retains B- Sr. Unsecured Ratings
CONVERGEONE HOLDINGS: S&P Affirms 'B-' ICR, Outlook Negative
DANA INC: Egan-Jones Keeps BB+ Senior Unsecured Ratings
DANESTAR LLC: Case Summary & Three Unsecured Creditors
DEPENDABLE MACHINE: Exclusivity Period Extended to Dec. 5
DIOCESE OF BUFFALO: NYAG Reaches Settlement With Diocese
DIOCESE OF ROCHESTER: Judge Erred in Okaying Claims vs. Parishes
DOMAN BUILDING: Fitch Affirms LongTerm IDR at 'B', Outlook Stable
DOUGLAS C. MAULDIN: Proposes to Auction Property Through Heritage
DUNBAR PLAZA: Unsec. Creditors Owed $269K to Split $150K in Plan
EAST COAST DIESEL: Seeks to Tap Sasser Law Firm as Legal Counsel
ECHOSTAR CORP: Egan-Jones Retains BB- Senior Unsecured Ratings
ELITE HOME: Unsecureds to Get 7% to 14% in Committee Plan
EMPACADORA Y PROCESADORA: Secured Creditor Says In Talks w/ Debtor
ENPRO INDUSTRIES: Egan-Jones Keeps BB+ Senior Unsecured Ratings
ESCADA AMERICA: Exclusivity Period Extended to Jan. 13
EXTERRAN ENERGY: Moody's Withdraws 'B1' CFR on Notes Repayment
EXWORKS CAPITAL: Abrahams Parties Object Claims Estimation
FIACA ASSOCIATES: Case Summary & 11 Unsecured Creditors
FINANCIAL INVESTMENTS: Judgment Creditors Oppose Disclosures
FLUOR CORP: Egan-Jones Retains B Senior Unsecured Ratings
FOSSIL GROUP: Egan-Jones Keeps B- Senior Unsecured Ratings
FRALEG GROUP: Nov. 16 Hearing on Disclosures and Plan
FRONT SIGHT: Files Supplement to Reorganization Plan
FRONTIER CHURCH: Unsecureds to Split $6K in Consensual Plan
GATHERING PLACE: HLDSMB Buying Orlando Property for $1.734 Million
GOOD GUYZ: Court Approves Sale of Miami Property to SK Florida
GPMI CO: $4.3M From Sponsor to Fund Plan Payments
HERBALIFE NUTRITION: Egan-Jones Keeps BB- Senior Unsecured Ratings
HILTON WORLDWIDE: Egan-Jones Retains B+ Senior Unsecured Ratings
HOBBS INVESTMENT: Dec. 6 Hearing on Disclosure Statement
HOUSE TO HOME: US Bank to Be Paid in Full in 10 Years in Plan
IGLESIAS DIOS: Plan Filing Deadline Extented to Nov. 18
ILLINOIS VALLEY: Case Summary & 20 Largest Unsecured Creditors
IMAX CORP: Egan-Jones Keeps BB- Senior Unsecured Ratings
INDEPENDENCE FUEL: Taps Valdez Washington as Special Counsel
INNOVATE CORP: Moody's Lowers CFR to Caa1, Outlook Stable
INTEGRITY CONSTRUCTION: Unsecureds to Get 28.58 Cents on Dollar
INTERDIGITAL INC: Egan-Jones Keeps BB+ Senior Unsecured Ratings
IONIS PHARMACEUTICAL: Egan-Jones Retains B+ Sr. Unsecured Ratings
IRON MOUNTAIN: Egan-Jones Retains BB Senior Unsecured Ratings
JBL RESTAURANT: $668K Sale of Riverbend Property to Thompsons OK'd
JEFFERIES FINANCE: Fitch Alters Outlook on 'BB+' IDR to Negative
JET OILFIELD SERVICES: U.S. Trustee Appoints Creditors' Committee
K STREET LLC: Files for Chapter 11, Bank Wants Rule 2004 Exam
KB HOME: Egan-Jones Retains BB- Senior Unsecured Ratings
KHOFFNER USA: Unsecured Creditors Will Get 30% of Claims in Plan
LAMAR ADVERTISING: Egan-Jones Retains BB- Senior Unsecured Ratings
LAREDO PETROLEUM: Egan-Jones Hikes Senior Unsecured Ratings to B+
LIFTING HOLDINGS: S&P Alters Outlook to Positive, Affirms 'B-' ICR
LIKEWIZE CORP: Moody's Cuts CFR to B2 & Alters Outlook to Negative
LUCKY STAR-DEER: Amends Flushing Landmark Unsecured Claims
LUNA ROSA: Case Summary & Seven Unsecured Creditors
MANITOWOC CO: Egan-Jones Keeps BB- Senior Unsecured Ratings
MERCER INTERNATIONAL: Egan-Jones Hikes Sr. Unsecured Ratings to BB
NATHANS'S FAMOUS: Egan-Jones Hikes Senior Unsecured Ratings to B+
NATIVE ENGINEERS: Case Summary & 20 Largest Unsecured Creditors
NEKTAR THERAPEUTICS: Egan-Jones Retains CCC- Sr. Unsecured Ratings
NORDSTROM INC: Egan-Jones Retains B+ Senior Unsecured Ratings
NUVO TOWER: Bayport Funding Says Disclosure Statement Inadequate
OAK PARENT: Moody's Rates $347MM Extended Secured Term Loan 'B3'
OCCIDENTAL PETROLEUM: Egan-Jones Hikes Sr. Unsec. Ratings to BB+
OCEANEERING INTERNATIONAL: Egan-Jones Keeps B- Sr. Unsec. Ratings
OFFICE DEPOT: Egan-Jones Hikes Senior Unsecured Ratings to B+
ORION BAY ESTATES: Unsecured Creditors to Split $5K in Plan
OUTFRONT MEDIA: Egan-Jones Keeps CCC Senior Unsecured Ratings
OWENS & MINOR: Egan-Jones Keeps BB- Senior Unsecured Ratings
OXBOW CARBON: Moody's Affirms B2 CFR & Alters Outlook to Positive
PANHANDLE PAWN: $405K Sale of Marianna Property Rendered Moot
PARK HOTELS: Egan-Jones Retains B+ Senior Unsecured Ratings
PHASEBIO PHARMA: Oct. 31 Deadline Set for Panel Questionnaires
PHILLIP B. SCOTT: Radicle Offers $269K for Rock Island Property
POMPANO SENIOR: Unsecureds to Recover 100% in Subchapter V Plan
PORTOFINO TOWERS: Plan Hearing Continued to Dec. 6
PUERTO RICO: Pays $492 Mil. to Cover Cofina Debt Service
RADIATE HOLDCO: Moody's Affirms B2 CFR & Alters Outlook to Negative
REAMIR 57 CORP: Has Until Jan. 31, 2023 to File Plan and Disclosure
RENT-A-CENTER INC: Egan-Jones Retains BB Senior Unsecured Ratings
RESTLAND MEMORIAL: Sale of Monroeville Property for $100K Denied
REVLON INC: Egan-Jones Hikes Senior Unsecured Ratings to CC
ROWAN SAWDUST: Bankr. Administrator Asks for Feasibility Analysis
RYDER SYSTEM: Egan-Jones Retains BB+ Senior Unsecured Ratings
S B BUILDING: Exclusivity Period Extended to March 21
S.A. WAGNER: Seeks Approval to Hire a Bookkeeper
SIX FLAGS: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
SM ENERGY: Egan-Jones Retains B+ Senior Unsecured Ratings
SOUTHWESTERN ENERGY: Egan-Jones Retains B Senior Unsecured Ratings
SPG HOSPICE: Trustee's Amended Plan to Repay Claims in 5 Years
STERICYCLE INC: Egan-Jones Retains B+ Senior Unsecured Ratings
STERICYCLE INC: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
SUMAK KAWSAY: Unsecureds Owed $35K to Get 10% Dividend in Plan
SUMMIT HOTEL: Egan-Jones Retains BB Senior Unsecured Ratings
SUNSTONE HOTEL: Egan-Jones Retains BB- Senior Unsecured Ratings
TEGNA INC: Egan-Jones Retains CCC+ Senior Unsecured Ratings
TELEPHONE AND DATA: Egan-Jones Keeps B+ Senior Unsecured Ratings
TERESITA AVILA ALBA: Int'l. Investments Buying 2 L.A. Properties
TERESITA AVILA ALBA: Selling Two Los Angeles Properties for $1.4MM
TEXAS MARINE: Unsecureds Will Get 100% of Claims over 5 Years
TITLE PIPE: Unsecureds Will Get 6% of Claims over 60 Months
TOSCANA LUNA: Property Sale Expected to Pay Claims in Full
TPC GROUP: Explosion Case Supplier Objects to Chapter 11 Plan
TRANSOCEAN INC: Moody's Ups CFR to Caa1 & Alters Outlook to Stable
TRANSPORTATION DEMAND: Says Agreement Reached With Parkview
TUPPERWARE BRANDS: Egan-Jones Keeps BB- Senior Unsecured Ratings
UNITED AIRLINES: Egan-Jones Keeps B+ Senior Unsecured Ratings
UNITIKA LTD: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
VAIL RESORTS: Moody's Ups CFR to Ba2 & Sr. Unsecured Notes to Ba3
VIASAT INC: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
VOYAGER DIGITAL: Amends Account Holder & Unsecured Claims Details
VOYAGER DIGITAL: CEO Ehrlich Dropped from Crypto Ponzi Scheme Suit
VOYAGER DIGITAL: Plan Slated for Dec. 8 Confirmation Hearing
VOYAGER DIGITAL: Unsecureds, Customers to Get 72% in FTX Sale Plan
WATLOW ELECTRIC: S&P Rates New $175MM First-Lien Term Loan 'B'
WENDY'S CO: Egan-Jones Keeps B Senior Unsecured Ratings
WESCO INTERNATIONAL: Egan-Jones Keeps BB- Senior Unsecured Ratings
WEYERBACHER BREWING: $525K Sale of Assets to Change Capital OK'd
WILDWOOD VILLAGES: Trustee's Proposed Sale of Assets to Etalia OK'd
WINDSTREAM HOLDINGS: Too Late to Undo Plan, Says 2nd Circuit
WOLVERINE WORLD: Egan-Jones Keeps B Senior Unsecured Ratings
ZEN RESTORATION: Exclusivity Period Extended to Jan. 20
[^] BOND PRICING: For the Week from October 24 to 28, 2022
*********
839 E MINORKA: Claims to be Paid From Sale of Property
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839 E Minorka Partners, LLC, submitted a Plan and a Disclosure
Statement.
The Debtor had filed its 11 U.S.C. Section 363 motion for approval
of the sale of the building and land located at 839 E. Minorka
Road, Tucson, Arizona 85706, the sole asset of the Debtor. If
approved, this sale will pay secured creditors in full from the
sale with the exception of the City of Tucson, whose liens will
continue on the Property. On approval of the Plan, the Debtor will
be selling the building and land to Norbert Lawson under the terms
of the filed Section 363 motion for approval of this sale.
The sale will pay all claims in full with the exception of the
claims for the City of Tucson. The liens securing the interest of
the City of Tucson will remain on the Property following the sale
to Norbert Lawson. Therefore, there are no future income and
expense projections to be filed at this time
Under the Plan, Class 3 City of Tucson, the City of Tucson holds 2
statutory liens for payments made to the previous owner of the
property from the Housing Rehab Perpetual Loan Fund in the total
amount of $20,989. It is secured by a lien on the Property. The 2
statutory liens with the City of Tucson's interests and
encumbrances to remain on the Property following the sale of the
Property to Norbert Lawson. It is anticipated that the Property
would then be sold to a non-profit to be used for an affordable
housing project. In exchange for the City of Tucson waiving the
liens, the Property would be subject to a deed restriction that
runs with the land and limits development on the Property to
building low-income housing units. Class 3 is impaired.
The Plan and Disclosure Statement do not identify any unsecured
claims.
Attorney for the Debtor:
Bryan W. Goodman, Esq.
GOODMAN & GOODMAN, PLC
7473 E. Tanque Verde Rd
Tucson, AZ 85715
Telephone: 520-886-5631
E-mail: bwg@goodmanadvisor.com
A copy of the Disclosure Statement dated Oct. 21, 2022, is
available at https://bit.ly/3ToLAJg from PacerMonitor.com.
About 839 E Minorka Partners
839 E Minorka Partners, LLC, is a single asset real estate company
whose sole member is Community Partners in Housing, an Arizona
Non-Profit. The company's sole assets is the building and land
located at 839 E. Minorka Road, Tucson, Arizona 85706.
The Property is subject to a deed of trust in favor of Bank of
America, which secures payment under a promissory note dated
December 30, 2005 in the original principal amount of $93,571.
The Note was in default for failure to pay the outstanding balance
due on maturity, and a trustee's sale was set for May 24, 2022.
To stop the trustee's sale, 839 E Minorka Partners filed a Chapter
11 petition (Bankr. D. Ariz. Case No. 22-bk-03299) on May 24, 2022.
The Debtor is represented by GOODMAN & GOODMAN, PLC.
A.B.C. OF NORTH PALM BEACH: Court Confirms Plan of Liquidation
--------------------------------------------------------------
Judge Mindy A. Mora has entered an order approving the First
Amended Disclosure Statement and confirming and approving the First
Amended Plan of Liquidation of A.B.C. of North Palm Beach, Inc.
Any party to a contract or lease rejected pursuant to the Plan
Confirmation Order with a claim for rejection damages may file with
the Court a claim within 30 days from the date of entry of the
Confirmation Order and serve a copy on the Debtor's counsel. The
Debtor will have 30 days from receipt thereof to file an objection
to such rejection Claim.
The Court will conduct a post-confirmation status conference on
Nov. 15, 2022 at 1:30 p.m. The post-confirmation status conference
will take place at the United States Bankruptcy Court located at
1515 N. Flagler Drive, Courtroom A, Room 801, West Palm Beach FL
33401.
Mark S. Roher, Esq. as Disbursing Agent is authorized to direct the
closing agent, Craig A. Pugatch, Esq. to pay the estate
professionals pursuant to separate final orders awarding fees, all
outstanding U.S. Trustee fees and final distributions to Class 7
claimants at the closing of the sale of the Debtor's real
property.
The Plan has eight classes. The Plan treats Class 1 as impaired
and the other remaining classes as unimpaired. Class 1 voted in
favor of the Plan and has therefore accepted the Plan.
Accordingly, the requirements of 11 U.S.C. Sec. 1129(a)(7) have
been satisfied.
As earlier reported in the Troubled Company Reporter, under the
Plan, the Debtor's real property located at North Palm Beach,
Florida, will be sold and secured and unsecured creditors will
receive a distribution of 100% of their allowed claim(s). Holders
of Class 7 General Unsecured Claims will be paid in full at the
closing of the sale of the Real Property. The Debtor has signed a
Purchase and Sale Agreement with William B. Reichel or his
designated affiliate for the purchase price of $2,100,000 subject
to higher and better
offers.
Counsel for the Debtor:
Mark S. Roher, Esq.
1806 N. Flamingo Road, Suite 300
Pembroke Pines, FL 33028
E-mail: mroher@markroherlaw.com
About A.B.C. of North Palm Beach
A.B.C. of North Palm Beach, Inc., owns the real property located at
763 and 775 Northlake Blvd., North Palm Beach, Fla.
To stop foreclosure, A.B.C. of North Palm Beach filed for Chapter
11 protection (Bankr. S.D. Fla. Case No. 22-12797) on April 10,
2022. In the petition filed by My Tran, president, A.B.C. listed
up to $10 million in assets and up to $50,000 in liabilities.
Judge Mindy A. Mora oversees the case.
Mark S. Roher, Esq., at the Law Office of Mark S. Roher, P.A., and
Lorium Law serve as the Debtor's bankruptcy counsel and special
counsel, respectively.
ACCO BRANDS: Egan-Jones Retains B+ Senior Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company, on September 20, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Acco Brands Corporation.
Headquartered in Lake Zurich, Illinois, Acco Brands Corporation
manufactures office products.
ADT SECURITY: Egan-Jones Retains B- Senior Unsecured Ratings
------------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its
'B-' foreign currency and local currency senior unsecured ratings
on debt issued by ADT Security Corporation. EJR also retained its
'B' rating on commercial paper issued by the Company.
Headquartered in Boca Raton, Florida, ADT Security Corporation
provides security systems.
ADVISOR GROUP: Fitch Affirms 'B-' LongTerm IDR, Outlook Stable
--------------------------------------------------------------
Fitch Ratings has affirmed Advisor Group Holdings, Inc.'s Long-term
Issuer Default Rating (IDR) at 'B-', senior secured debt rating at
'B'/'RR3' and senior unsecured debt rating at 'CCC'/'RR6'. The
Rating Outlook is Stable.
KEY RATING DRIVERS
IDR and Senior Debt
The rating affirmations reflect Advisor Group's improving market
position as one of the largest independent financial advisors in
the U.S., cash-generative business model, enhanced product and
revenue diversification, given recent acquisition activity,
declining leverage levels given the expected earnings benefit from
the acquisition of Infinex and pending acquisition of American
Portfolios, an improved liquidity profile, relatively flexible cost
base, which should help cushion revenue declines in downward market
environments and high advisor retention rates.
The ratings are constrained by elevated, albeit improving, leverage
levels, weak interest coverage metrics, relatively low EBITDA
margin, highly competitive environment associated with the
independent broker-dealer and registered investment advisor (Hybrid
RIA) business model and challenges presented by the volatile
economic environment. Advisor Group's ratings are also constrained
by its private equity ownership, which introduces a degree of
uncertainty over the company's future financial policies and the
potential for more opportunistic growth strategies.
Advisor Group's EBITDA margin, pro forma for the pending
acquisitions of Infinex and American Portfolios, was 13.8% for the
TTM ended 2Q22, consistent with Fitch's 'bb' category quantitative
benchmark range of 10%-20% for securities firms with low balance
sheet usage. On a gross revenue basis, margins remain structurally
low due to high production-based payouts to advisors. Fitch expects
Advisor Group's adjusted EBITDA margin to gradually improve,
supported by operating scale, higher interest rates, a growing
proportion of higher fee-generating assets on the proprietary
advisory platform and further cost optimizations.
Advisor Group's net interest income (NII) on cash balances held in
sweep accounts has improved in recent quarters due to the higher
rate environment, which has partially offset lower revenues reliant
on market performance.
Advisor Group's TTM net earnings improved through 2Q22 yoy,
primarily due to higher advisory and asset-based revenues, as well
as an increase in the valuation allowance for the deferred tax
asset. Earnings are expected to improve as Advisor Group benefits
from Infinex's access to the banking channel, further diversifying
the company's revenues, although the challenging market environment
will remain a headwind.
Advisor Group's pro-forma cash flow leverage, as expressed by gross
debt to EBITDA (adjusted for non-cash and non-recurring items) was
5.2x for the TTM ended 2Q22, down from 7.1x a year ago, and within
Fitch's 'b or below' benchmark category range of greater than 3.5x.
Fitch believes an ability to sustain leverage below 5.5x through
market cycles would result in positive rating momentum.
Advisor Group's asset performance, as reflected by net assets under
administration (AUA) flows, were negative 0.4% for the TTM ended
2Q22 and averaged negative 2.3% for the last four years
(2018-2021).
While market valuation was a headwind to flows, the firm reported
strong organic growth on its proprietary advisory platform, which
Fitch views favorably.
Pro forma interest coverage (EBITDA/interest expense) increased to
2.5x for the TTM ended 2Q22, up from 2.0x a year ago, due to an
increase in pro forma earnings, but the metric remains within
Fitch's 'b and below' category benchmark range of below 3.0x for
securities firms with low balance sheet usage. Lower coverage
metrics are partially offset by the relatively long-term maturity
profile of the firm's debt (nearest maturity is in 2026) and the
cash generative business model.
Advisor Group had cash and cash equivalents of approximately $378
million at June 30, 2022 and recently upsized the capacity on its
secured revolving credit facility by $125 million to $450 million.
This compares to approximately $15 million of annual debt
amortization requirements.
Advisor Group's senior secured debt rating is one notch above the
Long-Term IDR and reflects Fitch's view of above average recovery
prospects under a stress scenario. The senior unsecured rating is
two notches below the IDR and reflects structural subordination and
poor recovery prospects under a stress scenario.
Advisor Group Holdings, Inc. has an ESG Relevance Score of '4' for
Governance Structure due to Private Equity ownership which could
result in more opportunistic financial policies and higher leverage
tolerance which has a negative impact on the credit profile, and is
relevant to the ratings in conjunction with other factors.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- An ability to sustain leverage at-or-below 5.5x through market
cycles;
- Sustained maintenance of interest coverage at-or-above 2.5x;
- Sustained maintenance of the EBITDA margin above 10%;
- Consistently positive AUA flows and the continued shift of assets
onto the advisory platform; and/or
- Maintenance of an adequate liquidity profile.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Deterioration in operating results that prevent Advisor Group
from maintaining leverage at-or-below 7.0x;
- A weakened liquidity profile and/or a sustained reduction in
interest coverage below 2.0x;
- Sustained operational losses and a reduction in the EBITDA margin
below 5%;
- Sustained negative AUA flows;
- A material decline in advisor and asset retention rates; and/or
- A material increase in balance sheet-intensive activities.
The secured and unsecured debt ratings are primarily sensitive to
changes in Advisor Group's Long-Term IDR and secondarily to
relative recovery prospects for each class of debt under a stress
scenario.
ESG CONSIDERATIONS\
Advisor Group Holdings, Inc. has an ESG Relevance Score of '4' for
Governance Structure due to Private Equity ownership which could
result in more opportunistic financial policies and higher leverage
tolerance 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.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Advisor Group
Holdings, Inc. LT IDR B- Affirmed B-
senior
unsecured LT CCC Affirmed RR6 CCC
senior secured LT B Affirmed RR3 B
AEARO TECHNOLOGIES: 3M Urges 11th Circ. to Overturn Earplug Verdict
-------------------------------------------------------------------
Daniel Wilson of Law360 reports that 3M has urged the Eleventh
Circuit to overturn a $1.7 million bellwether verdict from
multidistrict litigation over faulty combat earplugs, saying it was
wrongly denied immunity, among many mistakes made by the district
court.
On Sept. 15, 2022, the U.S. Bankruptcy Court for the Southern
District of Indiana, in Case No. 22-02890, In re: Aearo
Technologies LLC, issued an order modifying the automatic stay
imposed by 11 U.S.C. Sec. 362(a) to allow certain appeals pending
in the U.S. Court of Appeals for the 11th Circuit to be fully and
finally resolved.
In light of that order, 11th Circuit Judge Andrew L. Brasher on
Sept. 29, 2022, ordered that the motions to lift any stay of those
appeals -- specifically, Baker v. 3M Company, et al., no. 21-12517,
Keefer v. 3M Company, et al., no. 21-13131, Hacker v. 3M Company,
et al., no. 21-13133, Estes v. 3M Company, et al., no. 21-13135,
Kelley v. 3M Company, et al., no. 22-11607, Wilkerson v. 3M
Company, et al., no. 22-12719, and Adkins v. 3M Company, et al.,
no. 22-12812 -- is GRANTED.
According to Bloomberg News, in In re 3M Combat Arms Earplug Prods.
Liab. Litig. (Baker v. 3M Co.), N.D. Fla., No. 7:20-cv-00039,
verdict 6/18/21, Lloyd Baker, a U.S. Army veteran who alleges he
used ineffective earplugs made by 3M Co. and its subsidiary Aearo
Technologies LLC, was awarded $1.7 million in damages from the
companies for his hearing loss and tinnitus, a federal jury in
Florida decided in the third and last case of a round of test
trials. Baker, like three veterans who collectively won about $7
million in the first trial, prevailed in the U.S. District Court
for the Northern District of Florida.
The bellwether trials are part of consolidated litigation over the
earplugs, encompassing about 200,000 claims, many only
"administratively" filed in a placeholder arrangement. The
plaintiffs are current and former members of the military, together
with some civilians, who allege they developed hearing loss and
tinnitus.
Aylstock Witkin Kreis & Overholtz, PLLC; Seeger Weiss LLP; Tracy &
Fox Law Firm; Clark, Love & Hutson PLLC; and Ciresi Conlin LLP are
representing the plaintiffs. Kirkland & Ellis LLP; Moore, Hill &
Westmoreland PA; and Dechert LLP represent the defendants.
About Aearo Technologies
Aearo Technologies -- https://earglobal.com/en -- is a 3M company
that designs, manufactures, and sells personal protection
equipment. The Company offers prescription and non-prescription
safety eye wear, face shields, hard hats, and respirators. Aearo
serves customers worldwide.
To address claims related to the Combat Arms Earplugs Version 2,
Aearo Technologies LLC and its affiliates sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Ind. Lead Case
No. 22-02890) on July 26, 2022. In the petition filed by John R.
Castellano, as authorized signatory, Aearo Technologies estimated
assets and liabilities between $1 billion and $10 billion each.
3M is not a debtor in the Chapter 11 cases. 3M has committed $1
billion to fund a trust allocated for Combat Arms claims.
Kirkland & Ellis LLP is serving as legal counsel and AlixPartners
LLP is serving as restructuring advisor to Aearo Technologies. Ice
Miller LLP is serving as bankruptcy co-counsel to the Debtors.
Kroll is the claims agent.
PJT Partners is serving as financial advisor and White & Case LLP
is serving as legal counsel to 3M.
AES CORP: Egan-Jones Retains BB Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company, on September 19, 2022, retained its
'BB' foreign currency and local currency senior unsecured ratings
on debt issued by AES Corporation.
Headquartered in Arlington County, Virginia, AES Corporation is an
electric power distribution company.
AIR CANADA: Egan-Jones Lowers Senior Unsecured Ratings to CCC-
--------------------------------------------------------------
Egan-Jones Ratings Company, on September 15, 2022, downgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Air Canada to CCC- from CCC. EJR also retained its
'C' rating on commercial paper issued by the Company.
Headquartered in Montreal, Canada, Air Canada provides domestic and
international carrier service.
B&G FOODS: Egan-Jones Retains B Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company, on September 20, 2022, retained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by New Jersey, B&G Foods Inc.
Headquartered in Parsippany-Troy Hills, New Jersey, B&G Foods Inc.
manufactures, sells, and distributes shelf-stable foods across
North America.
BACKYARD WORKROOM: Seeks to Tap Eric A. Liepins as Legal Counsel
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Backyard Workroom, LLC seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Texas to employ Eric A. Liepins,
PC as its bankruptcy counsel.
The Debtor requires legal assistance for the purpose of orderly
liquidating the assets, reorganizing the claims of the estate, and
determining the validity of claims asserted against the estate.
The hourly rates of the firm's counsel and staff are as follows:
Eric A. Liepins $275
Paralegals and Legal Assistants $30 - $50
In addition, the firm will seek reimbursement for expenses
incurred.
The firm has been paid a retainer of $5,000 plus the filing fee.
Eric Liepins, Esq., the firm's sole shareholder, disclosed in a
court filing that his firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Eric A. Liepins, Esq.
Eric A. Liepins, PC
12770 Coit Road, Suite 850
Dallas, TX 75251
Telephone: (972) 991-5591
Facsimile: (972) 991-5788
Email: eric@ealpc.com
About Backyard Workroom
Backyard Workroom, LLC sought protection for relief under Chapter
11 of the Bankruptcy Code (Bankr. E.D. Texas Case No. 22-41366) on
Oct. 14, 2022, with up to $500,000 in both assets and liabilities.
Eric A Liepins, Esq. at Eric A. Liepins, P.C. serves as the
Debtor's counsel.
BARNSTORM RESOURCES: Granted 4-Month Extension to File Exit Plan
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Barnstorm Resources, LLC has been given more time to file its plan
for emerging from Chapter 11 protection.
Judge Joshua Searcy of the U.S. Bankruptcy Court for the Eastern
District of Texas extended by 120 days the period during which the
company has the exclusive right to file a reorganization plan.
Barnstorm's current exclusive filing period expired on Oct. 5.
"Although this is not an exceptionally complex case, the underlying
mineral property assets contain many complex features that bear
directly upon the formulation of an exit from Chapter 11," said the
company's attorney, Jeff Carruth, Esq., at Weycer, Kaplan, Pulaski
& Zuber, P.C.
About Barnstorm Resources
Barnstorm Resources, LLC is the owner and operator of various
producing mineral properties in Johnson County, Texas. The company
is based in Longview, Texas.
Barnstorm Resources sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Tex. Case No. 22-60246) on June 7,
2022, with as much as $50,000 in both assets and liabilities. Kevin
Russell, manager, signed the petition.
Judge Joshua P. Searcy oversees the case.
Jeff Carruth, Esq., at Weycer, Kaplan, Pulaski & Zuber, P.C., is
the Debtor's counsel.
BELLA VENEZIA: Exclusivity Period Extended to Jan. 7
----------------------------------------------------
Bella Venezia 211, LLC obtained a court order extending its
exclusive right to file a Chapter 11 plan to Jan. 7, 2023, and
solicit votes in favor of the plan to March 7, 2023.
The ruling by the U.S. Bankruptcy Court for the Southern District
of Florida gives the company enough time to negotiate and pursue a
plan to exit bankruptcy without the threat of a competing plan from
creditors.
About Bella Venezia
Bella Venezia 211, LLC filed a petition for Chapter 11 protection
(Bankr. S.D. Fla. Case No. 22-11738) on March 2, 2022, listing as
much as $500,000 in both assets and liabilities. Laurent Bezaquen,
authorized representative, signed the petition.
Judge Robert A. Mark oversees the case.
The Debtor tapped Joel M. Aresty P.A. as legal counsel.
BERWICK HOSPITAL: Seeks to Hire Robert Bassel as Bankruptcy Counsel
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Berwick Hospital Company, LLC seeks approval from the U.S.
Bankruptcy Court for the Eastern District of Michigan to hire
Robert Bassel, Esq., a practicing attorney in Clinton, Mich., to
handle its Chapter 11 case.
Mr. Basel received a retainer of $19,738, including the filing fee
of $1,738.
In court papers, Mr. Basel disclosed that he is a "disinterested
person" within the meaning of Section 101(14) of the Bankruptcy
Code.
Mr. Basel can be reached at:
Robert Bassel, Esq.
P.O. Box T
Clinton, MI 49236
Phone: (248) 677-1234
Email: bbassel@gmail.com
About Berwick Hospital
Berwick Hospital Company, LLC is a Bloomfield Hills, Mich.-based
company, which operates in the health care industry.
Berwick filed a petition under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. E.D. Mich. Case No. 22-47699) on Sept. 30,
2022, with $100,000 to $500,000 in assets and $1 million to $10
million in liabilities. Richardo I. Kilpatrick has been appointed
as Subchapter V trustee.
Robert Bassel, Esq., serves as the Debtor's legal counsel.
Deborah Fish, Esq., at Allard & Fish, P.C., is the patient care
ombudsman appointed in the Debtor's Chapter 11 case.
BIOMARIN PHARMACEUTICAL: Egan-Jones Retains BB- Sr. Unsec. Ratings
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Egan-Jones Ratings Company, on September 21, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by BioMarin Pharmaceutical Inc.
Headquartered in Novato, California, BioMarin Pharmaceutical Inc.
develops and commercializes therapeutic enzyme products.
BLT RESTAURANT: Amends Unsecureds & JL Holdings Secured Claim Pay
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BLT Restaurant Group, LLC, submitted a Third Amended Disclosure
Statement for the Third Amended Plan of Liquidation dated October
24, 2022.
Formed in 2004, the Debtor once represented the best in
hospitality, through extraordinary food and unparalleled service.
The Debtor owned 100% of BLT Steak LLC, BLT Steak Waikiki LLC, BLT
Prime Lexington LLC, and owned 75% of BLT Steak DC LLC. The Debtor
also managed various locations at one time prior to the Petition
Date. The Debtor sold all of its known assets to the Buyer, as that
term is defined in the Sale Motion filed by the Debtor on June 30,
2022. This sale to the Buyer generated $150,000 that was deposited
by the Debtor into the Distribution Fund.
The Debtor is involved in a NAM Arbitration involving 3 unsecured
creditors that make up, based upon disputed amounts, a substantial
portion of the alleged unsecured claims against the Debtor. Each of
the three claimants filed an identical proof of claim for
approximately $3,467,000 in compensatory and punitive damages.
The Bar Date for both governmental and non-governmental creditors
is May 27, 2022 and, as of the filing of the Disclosure Statement,
passed nearly 5 months prior to the Court's consideration of the
Debtor's Disclosure Statement and voting materials.
Professional fees are estimated at $50,000-$75,000 for the Debtor.
Each professional person who holds or asserts an Administrative
Claim that is a Fee Claim incurred before the Effective Date shall
be required to file with the Bankruptcy Court a fee application
within 60 days after the effective date. Failure to file the fee
application timely shall result in the Fee Claim being forever
barred and discharged.
Class 1 consists of Allowed Unsecured Claims. Class 1 is Impaired.
Class 1 Claims are estimated at $12,500,000. Approximately
$10,400,000 is attributable litigation filed by three past
employees of a Debtor-owned restaurant that is the subject of a
stayed NAM Arbitration and disputed by the Debtor. The Debtor
proposes to distribute, on a pro rata basis, the balance of the
Distribution Fund after the payment of Administrative Claims,
estimated to be approximately $50,000-$75,000 to Class 1 on the
effective date. The treatment and consideration to be received by
holders of Class 1 Allowed Claims shall be in full settlement,
satisfaction, release and discharge of their respective Claims and
Liens.
Class 2 Claims consists of the holders of interests in the Debtor.
The Class 2 Claims are impaired. All existing membership interests
shall be retained by existing members but receive no distribution
under the Plan.
Class 3 consists of the secured claim of the JL Holdings 2002 LLC.
The Class 3 Claim is Impaired under the Plan. The collateral
securing the Class 3 Claim in the amount of $7,831,000.00 was sold
to JL Holdings 2002 LLC via credit bid. Class 3 will not share in
the Distribution Fund but will retain its lien on all of the
remaining assets of the Debtor should any assets be discovered.
The Debtor's Plan shall be funded by the proceeds of the sale to
the Buyer in the amount of $150,000 which the Class 3 creditor has
carved out from its collateral (the "Distribution Fund"). The
Distribution Fund shall first satisfy any administrative claims,
estimated to be approximately $50,000-$75,000, and fees owed to the
Office of the United States Trustee and then be distributed to
Class 1.
A full-text copy of the Third Amended Disclosure Statement dated
October 24, 2022, is available at https://bit.ly/3sGB4RY from
PacerMonitor.com at no charge.
Counsel for the Debtor:
Albert A. Ciardi, III, Esq.
Jennifer C. McEntee, Esq.
CIARDI CIARDI & ASTIN
1905 Spruce Street
Philadelphia, PA 19103
Telephone: (215) 557-3550
Facsimile: (215) 557-3551
E-mail: aciardi@ciardilaw.com
jcranston@ciardilaw.com
About BLT Restaurant Group
BLT Restaurant Group owns and manages the restaurants BLT Steak
LLC, BLT Steak Waikiki LLC, BLT Prime Lexington LLC, and BLT Steak
DC LLC. BLT is a limited liability company organized under the laws
of New York. At present, it has two members, JL Holdings 2002 LLC
and Juno Investments LLC. JL Holdings 2002 LLC is a limited
liability company organized under the laws of New York and is also
a secured creditor of BLT. Juno Investments LLC is a limited
liability company organized under the laws of New York.
BLT sought protection under Chapter 11 of the Bankruptcy Code
(Bankr. S.D.N.Y. Case No. 22-10335) on March 18, 2022. In the
petition signed by CEO James Haber, the Debtor disclosed up to $10
million in both assets and liabilities.
Judge Lisa G. Beckerman oversees the case.
Jennifer C. McEntee, Esq., at Ciardi Ciardi and Astin, is the
Debtor's counsel.
BLUCORA INC: Egan-Jones Retains B+ Senior Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Blucora, Inc.
Headquartered in Irving, Texas, Blucora, Inc. is a provider of
technology-enabled financial services to consumers, small
businesses and tax professionals through its subsidiaries.
BRAZOS ELECTRIC: Law Firm of Russell Represents Utility Companies
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Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
Russell R. Johnson, III of the Law Firm of Russell R. Johnson III,
submitted a verified statement to disclose that it is representing
the utility companies in the Chapter 11 cases of Brazos Electric
Power Cooperative, Inc.
The names and addresses of the Utilities represented by the Firm
are:
a. AEP Texas Inc.
Electric Transmission Texas, LLC
Attn: Melissa A. Gage, Esq.
Associate General Counsel
400 West 15th Street
Austin, Texas 78701-1677
b. CenterPoint Energy Houston Electric, LLC
Attn: Douglas H. Darrow, Esq.
Associate General Counsel
CenterPoint Energy, Inc.
1111 Louisiana St.
Houston, TX 77002
The nature and the amount of claims of the Utilities, and the times
of acquisition thereof are as follows:
a. AEP Texas filed claims against the Debtor for: (i) the
Debtor's use of local distribution facilities prior to the March 1,
2021 petition date that are billed pursuant to the Amended and
Restated Service Agreement for ERCOT Regional Transmission Service
between AEP Texas and the Debtor [Claim No. 358]; and (ii)
transmission service provided to the Debtor prior to the Petition
Date pursuant to the terms of the Open Access Transmission Service
Tariff of the American Electric Power System [Claim No. 359]. The
Debtor has satisfied the prepetition transmission charges owed.
b. ETT has a claim against the Debtor for unpaid prepetition
transmission services provided to the Debtor pursuant to the terms
of ETT's Wholesale Transmission Tariff [Claim No. 357]. The Debtor
has satisfied the prepetition transmission charges owed.
c. CEHE provided the Debtor with prepetition utility
transmission and distribution services and continues to provide the
Debtor with utility transmission and distribution services since
the Petition Date.
The Law Firm of Russell R. Johnson III, PLC was retained to
represent the Utilities in March 2021. The circumstances and terms
and conditions of employment of the Firm by the Utilities is
protected by the attorney-client privilege and attorney work
product doctrine.
The Firm can be reached at:
Russell R. Johnson III, Esq.
LAW FIRM OF RUSSELL R. JOHNSON III, PLC
2258 Wheatlands Drive
Manakin-Sabot, VA 23103
Tel: (804) 749-8861
Fax: (804) 749-8862
E-mail: russell@russelljohnsonlawfirm.com
A copy of the Rule 2019 filing is available at
https://bit.ly/3sJuIkE at no extra charge.
About Brazos Electric Power Cooperative
Brazos Electric Power Cooperative Inc. is a 3,994-megawatt
transmission and generation cooperative which members' service
territory covers 68 counties from the Texas Panhandle to Houston.
It was organized in 1941 and the first cooperative formed in the
Lone Star state with the primary intent of generating and supplying
electrical power. At present, Brazos Electric is the largest
generation and transmission cooperative in the state and is the
wholesale power supplier for its 16 member-owner distribution
cooperatives and one municipal system.
Brazos Electric filed a voluntary petition for relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 21-30725)
on March 1, 2021. At the time of the filing, the Debtor disclosed
assets of between $1 billion and $10 billion and liabilities of the
same range.
Judge David R. Jones oversees the case.
The Debtor tapped Norton Rose Fulbright US, LLP as bankruptcy
counsel, Foley & Lardner LLP and Eversheds Sutherland US LLP as
special counsel, Collet & Associates LLC as investment banker, and
Berkeley Research Group, LLC, as financial advisor. Ted B. Lyon &
Associates, The Gallagher Law Firm, West & Associates LLP, Butch
Boyd Law Firm and Boyd Smith Law Firm, PLLC serve as special
litigation counsel. Stretto is the claims and noticing agent.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtor's case on March 15, 2021. The
committee is represented by the law firms of Porter Hedges, LLP and
Kramer, Levin, Naftalis & Frankel, LLP. FTI Consulting, Inc. and
Lazard Freres & Co. LLC serve as the committee's financial advisor
and investment banker, respectively.
BRAZOS ELECTRIC: Sussman & Moore Represents Utility Companies
-------------------------------------------------------------
Pursuant to Rule 2019 of the Federal Rules of Bankruptcy Procedure,
Weldon L. Moore, III of Sussman & Moore, LLP submitted a verified
statement to disclose that it is representing the utility companies
in the Chapter 11 cases of Brazos Electric Power Cooperative, Inc.
The names and addresses of the Utilities represented by the Firm
are:
a. AEP Texas Inc.
Electric Transmission Texas, LLC
Attn: Melissa A. Gage, Esq.
Associate General Counsel
400 West 15th Street
Austin, Texas 78701-1677
b. CenterPoint Energy Houston Electric, LLC
Attn: Douglas H. Darrow, Esq.
Associate General Counsel
CenterPoint Energy, Inc.
1111 Louisiana St.
Houston, TX 77002
The nature and the amount of claims of the Utilities, and the times
of acquisition thereof are as follows:
a. AEP Texas filed claims against the Debtor for: (i) the
Debtor's use of local distribution facilities prior to the March 1,
2021 petition date that are billed pursuant to the Amended and
Restated Service Agreement for ERCOT Regional Transmission Service
between AEP Texas and the Debtor [Claim No. 358]; and (ii)
transmission service provided to the Debtor prior to the Petition
Date pursuant to the terms of the Open Access Transmission Service
Tariff of the American Electric Power System [Claim No. 359]. The
Debtor has satisfied the prepetition transmission charges owed.
b. ETT has a claim against the Debtor for unpaid prepetition
transmission services provided to the Debtor pursuant to the terms
of ETT's Wholesale Transmission Tariff [Claim No. 357]. The Debtor
has satisfied the prepetition transmission charges owed.
c. CEHE provided the Debtor with prepetition utility
transmission and distribution services and continues to provide the
Debtor with utility transmission and distribution services since
the Petition Date.
Sussman & Moore, LLP was retained to represent the Utilities in
March 2021. The circumstances and terms and conditions of
employment of the Firm by the Utilities is protected by the
attorney-client privilege and attorney work product doctrine.
The Firm can be reached at:
Weldon L. Moore, III
SUSSMAN & MOORE, LLP
2911 Turtle Creek Blvd., Ste. 1100
Dallas, TX 75219
Telephone: (214) 378-8270
E-mail: wmoore@csmlaw.net
A copy of the Rule 2019 filing is available at
https://bit.ly/3sJuIkE at no extra charge.
About Brazos Electric Power Cooperative
Brazos Electric Power Cooperative Inc. is a 3,994-megawatt
transmission and generation cooperative which members' service
territory covers 68 counties from the Texas Panhandle to Houston.
It was organized in 1941 and the first cooperative formed in the
Lone Star state with the primary intent of generating and supplying
electrical power. At present, Brazos Electric is the largest
generation and transmission cooperative in the state and is the
wholesale power supplier for its 16 member-owner distribution
cooperatives and one municipal system.
Brazos Electric filed a voluntary petition for relief under Chapter
11 of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 21-30725)
on March 1, 2021. At the time of the filing, the Debtor disclosed
assets of between $1 billion and $10 billion and liabilities of the
same range.
Judge David R. Jones oversees the case.
The Debtor tapped Norton Rose Fulbright US, LLP as bankruptcy
counsel, Foley & Lardner LLP and Eversheds Sutherland US LLP as
special counsel, Collet & Associates LLC as investment banker, and
Berkeley Research Group, LLC, as financial advisor. Ted B. Lyon &
Associates, The Gallagher Law Firm, West & Associates LLP, Butch
Boyd Law Firm and Boyd Smith Law Firm, PLLC serve as special
litigation counsel. Stretto is the claims and noticing agent.
The U.S. Trustee for Region 7 appointed an official committee of
unsecured creditors in the Debtor's case on March 15, 2021. The
committee is represented by the law firms of Porter Hedges, LLP and
Kramer, Levin, Naftalis & Frankel, LLP. FTI Consulting, Inc. and
Lazard Freres & Co. LLC serve as the committee's financial advisor
and investment banker, respectively.
BRINK'S CO: Egan-Jones Retains B+ Senior Unsecured Ratings
----------------------------------------------------------
Egan-Jones Ratings Company, on September 19, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Brink's Company.
Headquartered in Richmond, Virginia, Brink's Company provides
security services globally.
CANADIAN UTILITIES: Egan-Jones Retains B Senior Unsecured Ratings
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Egan-Jones Ratings Company, on September 20, 2022, retained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by Canadian Utilities Limited.
Headquartered in Calgary, Canada, Canadian Utilities Limited
conducts operations in electrical utility services, independent
power production, and retail gas and electricity marketing.
CELSIUS NETWORK: Court Approves Chapter 11 Auction
--------------------------------------------------
A New York bankruptcy judge on Oct. 24, 2022, approved
cryptocurrency platform Celsius Network's plans to put its assets
up for auction in December and rejected a call to appoint a
committee to represent shareholders in the Chapter 11 case.
The Debtors proposed bidding procedures for the sale of
substantially all of the Debtors' assets. The Debtors have
clarified that the Debtors intend to sell all of their retail
platform, including, without limitation, customer earn accounts and
coin balances, retail and institutional lending portfolio, swap
services, staking platform, Celpay feature and CelsiusX, as well as
any Remaining Assets, including staking and mining operations and
any other Assets not sold in connection with the Retail Platform
Assets Sale. The Debtors have also noted that they "will not sell
or purport to sell any Assets absent a finding by the Court that
they have title and authority to sell the Assets." Notwithstanding
the U.S. Trustee's objection, the Court is satisfied that at this
stage the Debtors have provided sufficient clarity about the assets
being sold.
Judge Martin Glenn notes that in response to regulatory concerns of
certain of the Objectors, the Revised Proposed Order provides
certain information rights to state regulatory agencies to ensure
that, whichever Successful Bid is selected, a successful purchaser
will have to obtain any necessary regulatory approvals. The Court
is satisfied that these revisions provide adequate safeguards at
this juncture and will closely review any potential sale order for
regulatory issues.
The Court also approved the sale timeline.
"Time is not on the side of maximizing recovery by all
stakeholders. The "melting ice cube" analogy is sometimes misused,
but the reality here is that the Debtors will have significant
liquidity issues to continue operating in 2023," the judge said.
The Objectors have raised important questions about the rapid
timeline for bidding. The Bidding Procedures set forth in the
Revised Proposed Order moved the final deadline until Dec. 12,
2022, after the Examiner's initial report is due, and after the
Court hearing on the custody and withhold account issues.
Resolution of the custody and withhold account issues are important
but involve only a fraction of the potential estate assets that the
Debtors propose to sell. Additionally, a decision by this Court on
those issue is not necessarily the last word, and any appeals could
leave uncertainty for months or years. It is unrealistic to delay
any sale until such issues are finally resolved. Bids can be
structured with these uncertainties in mind.
The U.S. Trustee argues that a consumer privacy ombudsman should be
appointed if the Debtors are going to sell customer lists. The
Court agrees.
Sale Timeline
The Debtors have proposed this timeline to solicit bids for their
retail platform business, which includes customer earn accounts and
coin balances, retail and institutional lending portfolio, swap
services, staking platform, CelPay (the Debtors' cryptocurrency
payment and transfer feature), and CelsiusX (the Debtors'
decentralized finance arm that utilizes wrapped cryptocurrency
tokens to bridge centralized finance infrastructure to
decentralized finance opportunities), and any cryptocurrencies or
digital assets held by the Debtors (to the extent that they
comprise property of the estate as defined under section 541 of the
Bankruptcy Code):
* Initial Bid Deadline for Retail Platform Assets: Nov. 21, 2022
at 4:00 p.m. (prevailing Eastern Time)
* Final Bid Deadline for Retail Platform Assets: Dec. 12, 2022
at 4:00 p.m. (prevailing Eastern Time)
* Auction (if necessary) for Retail Platform Assets: Dec. 15,
2022 at 10:00 a.m. (prevailing Eastern Time) via remote video or
such other means as determined by the Debtors after consultation
with the Committee
* Cure Objection Deadline for Retail Platform Assets: Dec. 19,
2022 at 4:00 p.m. (prevailing Eastern Time)
* Sale Objection Deadline for Retail Platform Assets: Dec. 19,
2022 at 4:00 p.m. (prevailing Eastern Time)
* Sale Hearing for Retail Platform Assets: Dec. 22, 2022 at
10:00 a.m. (prevailing Eastern Time) or as soon thereafter as the
Court's calendar permits
The following dates and deadlines are proposed for the Debtors'
process to solicit bids for the Debtors' remaining assets (the
"Remaining Assets"), which shall include the mining assets (the
"Mining Assets") and the Retail Platform Assets to the extent that
that the Retail Platform Assets are not sold at the sale hearing
set forth above:
* Final Bid Deadline for Remaining Assets: Dec. 12, 2022 at 4:00
p.m. (prevailing Eastern Time)
* Auction for Remaining Assets: Dec. 15, 2022 at 10:00 a.m.
(prevailing Eastern Time) via remote video or such other means as
determined by the Debtors after consultation with the Committee
* Cure Objection Deadline for Remaining Assets: Dec. 19, 2022 at
4:00 p.m. (prevailing Eastern Time)
* Sale Objection Deadline for Remaining Assets: Dec. 19, 2022 at
4:00 p.m. (prevailing Eastern Time)
* Sale Hearing for Remaining Assets: Dec. 22, 2022 at 10:00 a.m.
(prevailing Eastern Time) or as soon thereafter as the Court's
calendar permits
Equity Committee
The Court agrees with the Creditors Committee and the Debtors that
the appointment of an Official Preferred Equity Committee is
inappropriate for three reasons:
* First, the equity holders are adequately represented by
already existing stakeholders and do not need additional
representation.
* Second, the Requesting Equity Holders have not met their
burden to demonstrate that there is a substantial likelihood of
equity recovery.
* Finally, other factors such as the balance of costs and
benefits to the estate, as well of the complexity of these Chapter
11 cases, do not weigh in favor or appointing an Official Preferred
Equity Committee
The Requesting Equity Holders have not shown that there is
substantial likelihood that equity will recover, the judge points
out.
"Here, no party has stated that the Debtors are "hopelessly
insolvent." The Requesting Equity Holders put forth no more than a
contingent legal theory in support of their contention that equity
will recover. Their theory is that because customers will not have
valid claims against Non Customer Facing Entities, there will
recoveries for equity. But both the Committee and the Debtors
strongly contest this legal theory and the Court has yet to rule on
this issue. Moreover, the fact that equity holders may be entitled
to recovery depending on this Court's ruling in certain disputes in
these Chapter 11 Cases is insufficient to satisfy the Requesting
Equity Holders' high burden that there is a "substantial
likelihood" of recovery. Williams, 281 B.R. at 223. All the other
information available indicates that the Debtors are likely
insolvent: the Debtors' CFO stated under oath that the Debtors are
insolvent and the Debtors' latest operating report indicates that
the Debtors' current liabilities are approximately $329 million
greater than their current assets," Judge Glenn 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.
White & Case LLP serves as legal advisor to the Creditors
Committee. Perella Weinberg Partners, LP, is the investment
banker, M3 Advisory Partners, LP, as financial advisor, and
Elementus Inc. is forensics advisor to the Committee.
CENTURY ALUMINUM: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on September 16, 2022, retained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by Century Aluminum Company. EJR also retained its
'B' rating on commercial paper issued by the Company.
Headquartered in Chicago, Illinois, Century Aluminum Company
produces primary aluminum, in both molten and ingot form, through
facilities located in the United States.
CEREMONY SALON: Court Denies Conditional Approval of Disclosures
----------------------------------------------------------------
Judge Lena Mansori James has entered an order denying the Ceremony
Salon, LLC's Motion for Order Conditionally Approving its
Disclosure Statement dated Oct. 18, 2022.
Having reviewed the disclosure statement filed and having found
that it contains certain inaccurate representations and incorrect
attachments.
About Ceremony Salon
Ceremony Salon, LLC, sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.C. Case No. 22-00492) on March 8,
2022. The case was transferred to the Middle District of North
Carolina (Bankr. M.D.N.C. Case No. 22-00492) on March 21, 2022.
In the petition signed by Rachel Lynn Radford, member-manager, the
Debtor disclosed up to $50,000 in assets and up to $500,000 in
liabilities.
Judge Lena Mansori James oversees the case.
Travis Sasser, Esq., at Sasser Law Firm, is the Debtor's counsel.
CHART INDUSTRIES: Egan-Jones Retains BB+ Senior Unsecured Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company, on September 22, 2022, retained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by Chart Industries, Inc.
Headquartered in Ball Ground, Georgia, Chart Industries, Inc.
operates as a global manufacturer of equipment used in the
production, storage, and end-use of hydrocarbon and industrial
gases.
CINEMARK HOLDINGS: Egan-Jones Retains CC Senior Unsecured Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company, on September 22, 2022, retained its
'CC' foreign currency and local currency senior unsecured ratings
on debt issued by Cinemark Holdings, Inc. EJR also retained its 'C'
rating on commercial paper issued by the Company.
Headquartered in Plano, Texas, Cinemark Holdings, Inc. operates as
a movie theater.
CITE LLC: Trustee's $4.68MM Sale of All Assets to Lake Point OK'd
-----------------------------------------------------------------
Judge Janet S. Baer of the U.S. Bankruptcy Court for the Northern
District of Illinois authorized Robert Handler, the Subchapter V
Trustee of Cite LLC, to sell substantially all the Debtor's assets
to Lake Point Tower Investment LLC for $4.68 million.
At the Closing of the Sale, the Trustee is authorized to:
A. Disburse sale proceeds to Republic Bank in an amount equal
to (a) $3,646,239.98, in satisfaction of all principal, interest
and other amounts owed as of the Petition Date in accordance with
proof of claim numbers 4 and 5, and (b) a per diem amount of
$423.78, which represents the amount Republic Bank believes it is
owed as per diem interest at the non-default rate, to be calculated
from the Petition Date through the Closing. These payments are
without prejudice to (a) further distributions to Republic Bank on
account of any allowed postpetition amounts under § 506(b), or (b)
Republic Bank’s prompt repayment of any amounts it receives that
exceed its allowed secured claims.
B. Disburse sale proceeds of $249,000 to Hilco Real Estate
in satisfaction of the $15,000 in expenses it advanced and the 5%
commissions due and payable to any and all real estate brokers,
including Hilco Real Estate, as broker for the Trustee and any real
estate broker for Purchaser. Hilco will promptly satisfy and pay
any brokerage commission owed to the broker for the Purchaser.
C. Pay any other charges, expenses or amounts customary and
necessary to close the sale of the Sale Property.
All other proceeds from the Sale are to be held by the Trustee in
the DIP account, subject to further order of Court.
The Sale is free and clear of all Liens and Claims.
There is cause to lift the stays contemplated by Bankruptcy Rules
6004 and 6006 and the Order will be effective immediately upon
entry such that the Trustee and the Purchaser are authorized to
close the Sale immediately upon its entry.
Within one business day after the entry of the Order, the
Subchapter V Trustee will cause to be refunded to Lakeshore
Commercial Properties LLC ("LCP"), Crown Chicago, Inc., Al Lotfi
("LCP Parties") and/or their counsel the $420,000, earnest money or
deposit previously wired to the IOLTA Account of the Trustee's
counsel by or on behalf of LCP and/or Crown. The Trustee's counsel
is authorized to wire such funds to the Burke, Warren, MacKay &
Serritella, P.C. IOLTA account, which account information will be
provided to the Trustee's counsel.
Solely for purposes of the Order and the PSA, and for no other
purposes, the Trustee has allocated a value of $190,000 for the
personal property that is being sold pursuant to the PSA, which
amount is based upon the values in the Debtor's bankruptcy
schedules.
About Cite LLC
Cite LLC, an American restaurant business, filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code
(Bankr.
N.D. Ill. Case No. 21-13730) on Dec. 3, 2021. In the petition
signed by Evangeline Gouletas, managing member, the Debtor
disclosed $5,517,547 in total assets and $7,945,223 in total
liabilities.
Judge Janet S. Baer oversees the case.
The Golding Law Offices, PC serves as the Debtor's counsel.
Robert Handler has been appointed as Subchapter V Trustee of Cite
LLC.
CITIZEN PROTECTION: Seeks 45-Day Extension to File Plan
-------------------------------------------------------
Citizen Protection, Inc., filed a motion for a second extension of
its time to file a Plan and Disclosure Statement.
Although the Debtor has been conducting the necessary steps in
order to comply with the order and finalize the terms to be
included in the Disclosure Statement and Plan, the Debtor needs
additional time to finalize such documents.
Furthermore, the Debtor deems it necessary to wait for the
expiration of the deadline to file government claims, which is set
for November 21, 2022, to have a complete scenario of Debtor's
liabilities in order to properly provide treatment under the plan
to be filed.
As such, the Debtor deems that an extension of time of 45 days will
be sufficient for the Debtor to finalize and file its Plan and
Disclosure Statement.
This request is made in good faith and will not unduly prejudice
any party in interest.
Counsel for the Debtor:
Javier Vilariño, Esq.
VILARINO & ASSOCIATES LLC
P.O. BOX 9022515
San Juan, PR 00902-2515
Tel: 787-565-9894
E-mail: jvilarino@vilarinolaw.com
About Citizen Protection
Citizen Protection Inc. provides strategic leadership for the
company by working with the Board of Directors and other management
to establish long-range goals, strategies, plans and policies.
Citizen Protection sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.P.R. Case No. 22-01475) on May 24, 2022,
listing between $50,000 and $100,000 in both assets and
liabilities. Edwin Ayala Figueroa, president of Citizen Protection,
signed the petition.
Javier Vilarino, Esq., at Vilarino & Associates, LLC and Tamarez
CPA, LLC serve as the Debtor's legal counsel and accountant,
respectively.
CITRIX SYSTEMS: Egan-Jones Retains BB+ Senior Unsecured Ratings
---------------------------------------------------------------
Egan-Jones Ratings Company, on September 21, 2022, retained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by Citrix Systems, Inc.
Headquartered in Fort Lauderdale, Florida, Citrix Systems, Inc.
operates as a cloud computing and virtualization technology
company.
CM WIND: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
-------------------------------------------------------
Egan-Jones Ratings Company, on September 14, 2022, retained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by CM Wind Down Topco Inc. EJR also retained its 'B'
rating on commercial paper issued by the Company.
Headquartered in Atlanta, Georgia, CM Wind Down Topco Inc. operates
as a radio broadcasting company.
COEUR MINING: Egan-Jones Retains BB- Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on September 22, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Coeur Mining, Inc.
Headquartered in Chicago, Illinois, Coeur Mining, Inc. operates as
a mining company.
COEUR MINING: S&P Alters Outlook to Neg., Affirms 'B' ICR
---------------------------------------------------------
S&P Global Ratings revised the outlook on Chicago-based gold and
silver producer Coeur Mining Inc. to negative from stable and
affirmed its 'B' issuer credit rating on the company. The
issue-level ratings on the company's debt are unchanged and we
revised the recovery rating on the company's $368.3 million senior
unsecured notes to '4' from '3'.
The negative outlook reflects S&P's expectation that Coeur's
earnings will remain pressured for the remainder of 2022 and 2023
due to elevated production costs and its assumption of lower gold
prices, leading to leverage approaching 5x within the next 12
months.
Coeur's adjusted earnings could decline by 25%-35% in 2022 and
remain depressed in 2023 on lower gold prices and high production
costs. Gold prices have tumbled from historical highs of close to
$2,000 per ounce in early 2022 to $1,650-$1,680 per ounce (/oz) as
of Oct. 13, 2022, pressured by high interest rates and a strong
U.S. dollar. The impact of the price drop has been partially offset
by Coeur's gold price hedges, of which the company still has
108,500 ounces hedged at an average price of $1,965/oz for the
second half of 2022 and 112,500 ounces at an average price of
$1,982/oz in 2023. Coeur also revised its cost guidance upward for
second-half 2022, reflecting the effect of inflation on input
costs, with some inputs rising by 45%-75% year over year. The trend
could result in the company's cost applicable to sales (production
costs per unit) for gold increasing by 20%-25% for fiscal 2022. S&P
expects adjusted EBITDA would decline to the $160 million-$180
million range annually in 2022 and 2023, compared with $219 million
in 2021 and $241 million in 2020. Apart from the hedge program,
increased production from the Rochester mine in second-half 2023
could drive unit costs lower at the mine and partially compensate
for our assumption of lower gold prices in 2023.
Coeur faces tightening covenant headroom under its maximum net
consolidated leverage covenant as earnings weaken. The company has
a maximum consolidated net leverage ratio of 3.5x as part of its
credit agreements. Although Coeur has been compliant over the past
several quarters, S&P projects covenant headroom of only about 10%
in the next 12 months, given our expectation of lower earnings. The
covenant headroom could be further pressured if Coeur increases
borrowings under its revolver to finance its cash flow deficits as
the company continues to work through the Rochester mine upgrades.
On the other hand, the narrow headroom would limit availability
under Coeur's revolving credit facility (RCF) if the company must
remain compliant. Such a scenario increases the likelihood of a
covenant breach barring any amendment to the credit agreement such
as a covenant waiver, covenant relief, or increasing the leverage
requirement. S&P expects the receipt of the $150 million proceeds
from the sale of the Crown and Sterling mine would offer some
near-term liquidity and covenant relief. However, the company could
quickly burn through this cash given the remaining capital
expenditure (capex) requirement to complete the Rochester mine
expansion. As of June 30, 2022, the company had spent about $350
million out of a total of about $600 million earmarked for the
project.
The successful completion and operation of the Rochester mine is a
key rating consideration. When completed, the Rochester mine is
expected to almost double production, with 76,000 ounces of gold
and 8 million ounces of silver expected annually. The recently
installed pre-screens on the existing crusher could lead to better
leach pad performance and higher recovery rates. Coeur also expects
significantly higher throughput, which would drive costs lower and
improve overall operational efficiency at the mine. The completion
of this project would also ease the pressure on Coeur's liquidity
as its capex would be limited to maintenance expenditure of about
$100 million-$120 million. Coeur continues to take measures to
increase funding availability for the successful completion of the
project. In addition to the sale of the Crown and Sterling mine,
Coeur sold 5 million of Victoria Gold Corp. shares for cash of
about $40 million. The company has additional shares and other
marketable securities worth about $50 million-$60 million, which
could be monetized to provide additional liquidity. The project is
still on course to be completed by mid-2023.
S&P said, "The negative outlook reflects our expectation that the
company's earnings will remain pressured for the remainder of 2022
and 2023 due to high input costs and our assumption of modestly
lower gold prices, leading to leverage approaching and potentially
exceeding 5x within the next 12 months. We also expect the company
would continue to generate significant negative FOCF given the
spending on the mine expansion/upgrade at Rochester."
S&P could lower its rating on Coeur if it sustains adjusted
leverage beyond 5x. This could occur if:
-- Coeur takes on additional debt to finance the completion of its
capital projects;
-- The company's negative FOCF accelerates because of weak
earnings or persistently heavy capex; or
-- Gold prices decline below $1,600/oz.
S&P could revise the outlook to stable if Coeur is able to complete
its projects on time without significantly increasing its debt or
if its earnings recover faster than expected due to favorable
markets for precious metals or an unexpected decline in operating
costs. In such a scenario, S&P would expect:
-- Adjusted leverage below 5x; and
-- At least breakeven FOCF.
ESG credit indicators: E-3,S-3,G-2
S&P said, "Environmental factors are a moderately negative
consideration in our credit rating analysis of Coeur. The company
operates five gold and silver mines in the U.S., Canada, and
Mexico, where it must adhere to stringent environmental and safety
regulations. Given the relatively small scale of its operations,
the company is exposed to environmental risks, such as weather
disruptions, water availability, and waste and tailings management.
Social factors are also a moderately negative consideration because
Coeur's business, including its Mexican operations that account for
about 36% of its revenue, could be exposed to politically motivated
labor strikes, social unrest, and other disruptions."
COGENT COMMUNICATIONS: Egan-Jones Retains B- Sr. Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company, on September 20, 2022, retained its
'B-' foreign currency and local currency senior unsecured ratings
on debt issued by Cogent Communications Holdings, Inc. EJR also
retained its 'B' rating on commercial paper issued by the Company.
Headquartered in Washington, D.C., Cogent Communications Holdings,
Inc. operates as a next-generation optical Internet service
provider focused on delivering ultra-high-speed Internet access and
transport services.
CONVERGEONE HOLDINGS: S&P Affirms 'B-' ICR, Outlook Negative
------------------------------------------------------------
S&P Global Ratings affirmed its ratings on U.S. value-added
reseller ConvergeOne Holdings Inc. and its debt, including its 'B-'
issuer credit rating, because S&P expects a significant improvement
in leverage next year as the company works through its backlog and
realizes the benefit of cost savings actions.
The negative outlook reflects the risk that S&P could lower its
rating on ConvergeOne if it does not renew its ABL on satisfactory
terms before it becomes current, its liquidity otherwise becomes
constrained, free cash flow generation does not improve, or if S&P
believes its leverage will remain elevated for an extended period.
Industrywide supply chain issues are hurting ConvergeOne's cash
flow. Over the last 12 months, a dearth of certain components and
other industrywide supply chain issues have delayed ConvergeOne's
ability to complete jobs. Since it typically cannot bill the
customer and collect cash until the job is finished, this is
temporarily hurting free cash flow. Free cash flow was negative in
2021, and we forecast it will be modestly negative again in 2022,
although we expect improved cash collection in the second half of
the year.
Operating problems at key vendor Avaya are also contributing to the
recent underperformance. Avaya is a leading provider of unified
communications (UC) and call center (CC) solutions to global
enterprises, but it has seen a drastic deterioration in revenue,
profitability, and cash flow generation this year. Avaya recently
disclosed it has doubts about its ability to continue as a going
concern. As a result of these well-publicized challenges,
ConvergeOne customers that use Avaya products are temporarily
opting for shorter contract lengths, which are lower margin for
ConvergeOne. S&P believes some customers will continue to use Avaya
and eventually renew for longer contracts once they have more
certainty on Avaya's future. Many others will likely migrate to
different providers such as Cisco or Microsoft Teams. S&P does not
expect any meaningful drop in revenue or profitability for
ConvergeOne if customers migrate away from Avaya.
Cost-saving initiatives should help improve margins and cash flow
over the next two years. ConvergeOne reduced headcount and took
other actions in the second and third quarters to reduce costs by
$30 million to $45 million on an annual run-rate basis. In
addition, it is working with McKinsey on a longer-term cost savings
project, which should save $65 million to $85 million annually by
relocating some of its employee base overseas, and through
digitization and automation projects. S&P expects ConvergeOne to
incur some cash costs to implement the initiatives, but it
forecasts improved margins in 2023 and 2024. This should also help
offset the impact of higher interest expense as floating interest
rates continue to climb.
S&P said, "If ConvergeOne does not extend its ABL facility by the
end of the year, it would affect our view of liquidity and we could
lower our ratings on the company. ConvergeOne's $250 million ABL
facility expires in early January 2024; a little over 12 months
from now. We expect the company to extend the facility before it
becomes current in two months. Although credit market conditions
are challenging, we believe it will extend the facility on
satisfactory terms given the facility's first-priority claim on the
company's accounts receivable, inventory, and other current
assets.
"The negative outlook reflects the risk that we could lower our
rating on ConvergeOne if we believe the company's capital structure
becomes unsustainable."
S&P could lower its rating on the company if:
-- It does not renew its ABL on satisfactory terms by the end of
2022;
-- Liquidity deteriorates because of continued supply chain issues
or a drop in corporate IT spending that further reduces revenue and
profitability;
-- S&P expects free cash flow to debt below 1%; or
-- Leverage remains elevated near 10x.
S&P could revise the outlook to stable if:
-- The company successfully extends its ABL;
-- If it meets S&P's forecast of 1%-3% free cash flow to debt in
2023; and
-- S&P expects leverage will decline toward 7x.
ESG credit indicators: E-2, S-2, G-3
DANA INC: Egan-Jones Keeps BB+ Senior Unsecured Ratings
-------------------------------------------------------
Egan-Jones Ratings Company, on September 15, 2022, retained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by Dana Incorporated. EJR also retained its 'B'
rating on commercial paper issued by the Company.
Headquartered in Maumee, Ohio, Dana Incorporated engineers,
manufactures, and distributes components and systems for worldwide
automotive, heavy truck, off-highway, engine, and industrial
markets.
DANESTAR LLC: Case Summary & Three Unsecured Creditors
------------------------------------------------------
Debtor: Danestar LLC
10205 Cedar Breaks Vw
McKinney, TX 75072
Chapter 11 Petition Date: October 28, 2022
Court: United States Bankruptcy Court
Eastern District of Texas
Case No.: 22-41449
Debtor's Counsel: Stephanie D. Curtis, Esq.
CURTIS CASTILLO PC
901 Main Street Suite 6515
Dallas, TX 75202
Email: scurtis@curtislaw.net
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Marcus Armstrong as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's three unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/2WJ7CGA/Danestar_LLC__txebke-22-41449__0001.0.pdf?mcid=tGE4TAMA
DEPENDABLE MACHINE: Exclusivity Period Extended to Dec. 5
---------------------------------------------------------
Dependable Machine Company, Inc. obtained a court order extending
its exclusive right to file a Chapter 11 plan to Dec. 5.
The ruling by the U.S. Bankruptcy Court for the Southern District
of Indiana allows the company to remain in control of its
bankruptcy while negotiations concerning the terms of its contracts
with Rolls-Royce Corporation are pending.
Dependable Machine Company previously filed a motion to reject two
unexpired contracts with its largest customer Rolls-Royce, which
motion is set to be heard on Nov. 9. As part of the discussions
concerning the proposed rejection of the contracts, the companies
agreed for a temporary delivery of goods pending talks on a
potential long-term agreement.
The company must have a resolution with Rolls-Royce in order to
continue in business as Rolls-Royce constitutes approximately 80
percent of its business, according to its attorney, Jeffrey Hester,
Esq., at Hester Baker Krebs, LLC.
About Dependable Machine Company
Dependable Machine Company, Inc. is an Indianapolis-based company,
which provides precision machining services.
Dependable Machine Company sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Ind. Case No. 22-02191) on
June 7, 2022, with $2,189,630 in assets and $3,007,363 in
liabilities. Cory Lowe, owner, signed the petition.
Judge James M. Carr oversees the case.
Jeffrey Hester, Esq., at Hester Baker Krebs, LLC is the Debtor's
counsel.
DIOCESE OF BUFFALO: NYAG Reaches Settlement With Diocese
--------------------------------------------------------
New York Attorney General Letitia James on Oct. 25, 2022, announced
a landmark settlement with the Roman Catholic Diocese of Buffalo
(Buffalo Diocese, the Diocese), resolving a lawsuit filed in
November 2020 that alleged the Buffalo Diocese persistently failed
to address the child sexual abuse crisis and systematically evaded
the very reforms it publicly adopted nearly 20 years ago for
investigating, reviewing, and responding to abuse complaints.
Instead, the Buffalo Diocese protected accused priests from facing
the potential consequences of abuse accusations by quietly removing
them from ministry.
The settlement ensures that the Buffalo Diocese will address
complaints of clergy sexual abuse appropriately through a
comprehensive court-ordered compliance program that is mandated for
five years. The settlement also establishes mechanisms to protect
the public by requiring the Buffalo Diocese to have a formal
program to individually monitor credibly accused priests and submit
to an independent annual audit of its compliance. The audits will
be conducted by a former senior agent at the Federal Bureau of
Investigation (FBI) with expertise in matters of clergy sexual
abuse, who has been vetted and approved by the Office of the
Attorney General (OAG). The auditor will issue annual reports,
which will be published on the Buffalo Diocese's website.
Additionally, Bishop Emeritus Richard J. Malone and former
Auxiliary Bishop Edward M. Grosz, in their individual capacities,
will be banned for life from holding any secular fiduciary role
with a charity registered in New York. Together, the components of
this settlement will provide long overdue accountability and
transparency to parishioners and the public.
"For far too long, the Buffalo Diocese and its leaders failed their
most basic duty to guide and protect our children," said Attorney
General James. "In choosing to defend the perpetrators of sexual
abuse instead of defending the most vulnerable, the Buffalo Diocese
and its leaders breached parishioners' trust and caused many a
crisis of faith. As a result of this action, the Buffalo Diocese
will now begin a much-needed era of independent oversight and
accountability, and my office will continue to do everything in its
power to restore trust and transparency for the future. No
individual or entity is above the law, and those who violate it in
New York state will always be held accountable."
In November 2020, following a two-year investigation, Attorney
General James filed a lawsuit against the Buffalo Diocese, Bishop
Emeritus Malone, and former Auxiliary Bishop Grosz for mishandling
child sexual abuse claims and failing to uphold their
responsibilities to victims of abuse, parishioners, and the public.
In the complaint, OAG alleged that the defendants violated their
legal and fiduciary obligations by failing to conduct proper
investigations into child sexual abuse accusations and not
monitoring numerous credibly accused priests. The complaint
detailed conduct that, as alleged, directly defied the procedures
and protections outlined in the Charter for the Protection of
Children and Young People (Charter) adopted by the United States
Conference of Catholic Bishops (USCCB) in 2002, following media
reports of widespread clergy sexual abuse. Though Bishop Emeritus
Malone and former Auxiliary Bishop Grosz were responsible for
ensuring the Buffalo Diocese's compliance with the Charter and
other related policies, the OAG investigation found that
allegations of sexual misconduct against diocesan priests were
concealed and inadequately investigated, if at all, for years. The
OAG also found that the Buffalo Diocese failed to refer more than
two dozen accused priests for adjudication as required by the
Charter. Instead, the Diocese shielded accused priests from the
consequences of public disclosure by removing them from ministry
with false claims of medical leaves or voluntary retirements.
As part of the settlement, the Buffalo Diocese has committed to
accelerated and fully transparent procedures for addressing sexual
abuse complaints in a required step-by-step and documented process.
For example, absent special circumstances, an independent
investigator must be appointed upon receipt of the complaint, and
all investigations must be completed within 45 days of the
appointment. The Diocese's Charter-mandated lay review board will
now be required to provide its recommendations for each case it
investigates in writing. The Diocese will also be required to make
public disclosures throughout the process, including posting the
lay review board's recommendation on its website, publicly
disclosing names of accused clergy who are suspended pending
investigations, and reporting all substantiated complaints. The
Diocese will also refer all complaints it receives to law
enforcement and will cooperate with any investigations.
In addition, the Buffalo Diocese's management of sexual abuse
complaints and allegations will now be subject to review by an
independent compliance auditor. The Attorney General has approved
the appointment of Dr. Kathleen McChesney, former Executive
Assistant Director at the FBI and first Director of the USCCB
Office of Child Protection, to fill this role. Dr. McChesney has
decades of experience investigating and addressing the problem of
sexual abuse within Catholic institutions. She and her team will
have guaranteed access to all documents and information necessary
to examine the Buffalo Diocese's compliance with the terms of the
settlement. The audit period will last for a minimum of three
years, with a potential extension to five years. As the Buffalo
Diocese is responsible for the retention and payment of Dr.
McChesney and her audit team, their appointment will not take
effect until approved by the United States Bankruptcy Court for the
Western District of New York, where the Diocese currently has a
pending petition for Chapter 11 Bankruptcy.
Under the agreement, the Bishop of the Buffalo Diocese, currently
Bishop Michael Fisher, is also responsible for taking necessary
steps to protect parishioners and the public from an individual who
has been credibly accused of sexual abuse. Under the Priest
Supervision Program codified in the settlement, which the Buffalo
Diocese has already begun to implement, accused clergy will be
assigned an individual monitor with law enforcement experience to
ensure their compliance with restrictions on their conduct that are
designed to ensure the safety of local parishioners and children.
Supervised clergy cannot perform priestly ministry duties, such as
saying mass or taking confessions, cannot wear their collar or
otherwise position themselves as a cleric in good standing, and
cannot live in close proximity to children or a school, among other
requirements. If an accused priest refuses to cooperate, the
Buffalo Diocese's policies have now been amended to allow the
current bishop the discretion to withhold that priest's pension
until they comply.
Bishop Emeritus Malone and former Auxiliary Bishop Grosz, named in
the settlement in their individual capacities, will be banned for
life from serving in any secular fiduciary role with any nonprofit
or charitable entity in New York state. Such bans are reserved for
fiduciaries who have committed serious breaches of their duties
with respect to the administration of charitable organizations or
assets.
Attorney General James' lawsuit and this settlement specifically
address the Buffalo Diocese's institutional response to the crisis
of clergy sexual abuse. In February 2020, the Buffalo Diocese
filed for Chapter 11 Bankruptcy, citing liabilities associated with
Child Victims Act cases. The settlement does not affect pending
claims for damages that have been asserted by individual survivors
of abuse against the Buffalo Diocese. At present, the Diocese
estimates that more than 900 Child Victims Act cases or bankruptcy
proofs of claim alleging sexual abuse of children by diocesan
priests have been filed.
The OAG began its investigation into the eight New York Catholic
dioceses in September 2018. Investigations into the Archdiocese of
New York and the Dioceses of Albany, Brooklyn, Ogdensburg,
Rochester, Rockville Centre, and Syracuse remain ongoing.
This matter is being handled by Assistant Attorneys General Daniel
Roque and Catherine Suvari, with the assistance of Assistant
Attorneys General Steven Shiffman and Diane Hertz, and Legal
Assistants Jacqueline Sanchez and Nina Sargent, all under the
supervision of Charities Bureau Chief James G. Sheehan and
Enforcement Section Co-Chief Emily Stern. The Charities Bureau is
a part of the Division for Social Justice, led by Chief Deputy
Attorney General Meghan Faux, and all under the oversight of First
Deputy Attorney General Jennifer Levy.
About The Diocese of Buffalo, N.Y.
The Diocese of Buffalo, N.Y., is home to nearly 600,000 Catholics
in eight counties in Western New York. The territory of the
diocese is co-extensive with the counties of Erie, Niagara,
Genesee, Orleans, Chautauqua, Wyoming, Cattaraugus, and Allegany in
New York State, comprising 161 parishes. There are 144 diocesan
priests and 84 religious priests who reside in the Diocese.
The diocese through its central administrative offices (a) provides
operational support to the Catholic parishes, schools, and certain
other Catholic entities that operate within the territory of the
Diocese "OCE"; (b) conducts school operations through which it
provides parish schools with financial and educational support; (c)
provides comprehensive risk management services to the OCEs; (d)
administers a lay pension trust and a priest pension trust for the
benefit of certain employees and priests of the OCEs; and (e)
provides administrative support for St. Joseph Investment Fund,
Inc.
Dealing with sexual abuse claims, the Diocese of Buffalo sought
Chapter 11 protection (Bankr. W.D.N.Y. Case No. 20-10322) on Feb.
28, 2020. The diocese was estimated to have $10 million to $50
million in assets and $50 million to $100 million in liabilities as
of the bankruptcy filing.
The Honorable Carl L. Bucki is the case judge.
Bond, Schoeneck & King, PLLC, led by Stephen A. Donato, Esq., is
the diocese's counsel; Connors LLP and Lippes Mathias Wexler
Friedman LLP are its special litigation counsel; and Phoenix
Management Services, LLC is its financial advisor. Stretto is the
claims agent, maintaining the page:
https://case.stretto.com/dioceseofbuffalo/docket
The Office of the U.S. Trustee appointed a committee of unsecured
creditors on March 12, 2020. The committee is represented by
Pachulski Stang Ziehl & Jones, LLP and Gleichenhaus, Marchese &
Weishaar, PC.
DIOCESE OF ROCHESTER: Judge Erred in Okaying Claims vs. Parishes
----------------------------------------------------------------
Will Astor of Rochester Beacon reports that the Roman Catholic
Diocese of Rochester argues in papers filed recently in the Western
District of New York's Rochester Division that Bankruptcy Judge
Paul Warren erred in letting abuse survivors' individually filed
claims against the Roman Catholic Diocese of Rochester's parishes
move ahead.
The diocese's appeal brief comes some three months after it filed a
notice of its intention to appeal Warren's May 2022 ruling. In
that decision, Warren said some 300 individually filed state court
Child Victims Act claims against Rochester Catholic parishes that
had been stayed since the bankruptcy's filing could resume.
The state passed the CVA in 2019. The act temporarily eliminated a
statute of limitations on certain sex-abuse crimes, making it
possible for victims -- now middle aged and older -- to seek
redress for abuse they had suffered as children decades ago. A
virtual tsunami of CVA claims followed, with many hitting the
Catholic Church and the Boy Scouts of America.
Faced with its own flood of such claims, the Rochester diocese
sought Chapter 11 bankruptcy court protection in September 2019, a
month after the CVA took effect. Catholic dioceses in Buffalo,
Syracuse and Long Island followed suit.
The Rochester case has since plodded through the court as
settlement negotiations that Warren ordered three years ago have so
far failed to yield an agreement. Parties to the talks are the
diocese, its liability carriers and the official creditors
committee, a body made up of abuse survivors with claims in the
case.
The other three New York diocesan bankruptcies are likely to take
their cue from the Rochester case. The same bankruptcy attorney,
Bond, Schoeneck & King member Stephen Donato, oversees all four New
York diocesan cases.
The court fight over the Rochester state-court parish cases,
meanwhile, could play an important role in setting terms for any
settlement the Rochester diocese might ultimately reach with abuse
survivors.
The state court cases were originally frozen under an agreement
inked between the diocese and the creditors committee. Before its
cancellation in May, the pact had been renewed 11 times.
The Bankruptcy Code calls for all filers to enjoy a so-called
automatic stay halting all state and federal court actions against
them while their bankruptcies play out. Such stays are meant to
halt proceedings like evictions to give filers time to resolve such
issues without undue pressure. Because of the way New York's
Catholic dioceses have legally organized themselves, individual
automatic-stay protection does not extend to parishes.
While church law puts a diocese's parishes firmly under the control
of each diocese's bishop, New York's Catholic dioceses have
registered each of their parishes as individual corporations.
Each diocese's bishop is president of each parish corporation,
preserving the authority granted to bishops under church law. But
when the Rochester diocese filed its bankruptcy, a special
agreement was needed to keep its parishes out of court.
For the church, that arrangement has proved to be a two-edged
sword. Early in the bankruptcy, parishes' legally separate status
led Rochester Diocese Bishop Salvatore Matano to reassure
parishioners that the bankruptcy would not affect their churches
and to assure contributors to church charitable drives that their
donations would not go toward settling court claims. That status
also deprives parishes of bankruptcy court protection, however.
In May 2022, the creditors committee, a body made up of abuse
survivors with claims in the case, upended the parish-stay
agreement, refusing to extend the pact. Survivors like creditors
committee chair Jim Cali had long voiced frustration over lack of
progress in negotiations toward a settlement. Reopening scores of
cases against individual parishes would pressure the diocese to
break what survivors see as a deadlock in the long-running
settlement talks.
Survivors had previously turned down a diocese bid to settle some
cases for $35 million. That offer -- put forward in 2021 -- was a
non-starter that would give survivors short shrift, creditors
committee attorney Ilan Scharf told the Rochester Beacon at the
time.
In July 2022, the diocese put forward a $147.5 million offer in
which it would pay $40 million, with insurance companies paying the
rest. The creditors committee and lawyers representing survivors
in state court cases spurned the offer, complaining that the deal
had been worked out between the diocese and insurers with no input
from survivors.
The creditors committee's cancellation of parish agreement,
meanwhile, had set up a court fight. With Warren's May 2022 ruling,
the diocese lost round one. With the appeal, it hopes to prevail
in round two.
The diocese sees the committee's move to upend the stay on parish
cases as a negotiating ploy amounting to "an ultimatum that the
diocese must either capitulate to the committee's terms of
settlement or else face a tidal wave of litigation," Donato writes
in the appeal brief.
"Clearly," he asserts, "the committee and many of the claimants
view litigation against the Catholic corporations as a key point of
leverage to extract a higher settlement value for prepetition
claims against the Diocese through mediation in the chapter 11
case."
Donato asserts in the brief that because the diocese's and its
parishes' affairs are entangled, the Bankruptcy Code requires that
the automatic stay be extended to the parishes as "related
parties." Judge Warren erred in virtually every aspect of his
decision to let the state court cases move forward, he argues.
Neither the creditors committee nor lawyers representing abuse
survivors in state court cases have yet answered the appeal brief.
About The Diocese of Rochester
The Diocese of Rochester in upstate New York provides support to 86
Roman catholic parishes across 12 counties in upstate New York. It
also operates a middle school, Siena Catholic Academy. The diocese
has 86 full-time employees and six part-time employees and provides
medical and dental benefits to an additional 68 retired priests and
two former priests.
The diocese generated $21.88 million of gross revenue for the
fiscal year ending June 30, 2019, compared with a gross revenue of
$24.25 million in fiscal year 2018.
The Diocese of Rochester filed for Chapter 11 bankruptcy protection
(Bankr. W.D.N.Y. Case No. 19-20905) on Sept. 12, 2019, amid a wave
of lawsuits over alleged sexual abuse of children. In the
petition, the diocese was estimated to have $50 million to $100
million in assets and at least $100 million in liabilities.
Bond, Schoenec & King, PLLC and Bonadio & Co. serve as the
diocese's legal counsel and accountant, respectively. Stretto is
the claims and noticing agent.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors in the diocese's Chapter 11 case. Pachulski
Stang Ziehl & Jones, LLP and Berkeley Research Group, LLC serve as
the committee's legal counsel and financial advisor, respectively.
DOMAN BUILDING: Fitch Affirms LongTerm IDR at 'B', Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has affirmed the ratings of Doman Building Materials
Group Ltd. (DBM; Doman), including the company's Long-term Issuer
Default Rating (IDR) at 'B' and unsecured notes at 'B/RR4'. The
Rating Outlook is Stable.
Doman's IDR and Stable Outlook reflect its modest leverage levels,
which provides a cushion as the housing market slows down and
lumber prices decline from record levels. Fitch forecasts debt to
EBITDA to increase next year, situating between 4.5x-5.0x in 2023
and 2024.
The IDR also reflects Doman's relatively commoditized product
offering and the thin EBITDA and FCF margins inherent to the
two-step building products distribution sector. The cyclicality of
the residential housing market and the company's susceptibility to
swings in lumber prices are also factored into the rating. DBM is
one of the top North American pressure treated lumber manufacturers
and distributors and maintains a sufficient liquidity position.
KEY RATING DRIVERS
Modest Leverage Provides Cushion: Fitch expects Doman's debt to
EBITDA (excluding capitalized leases as debt and including lease
amortization and interest as an operating expense) to be about 3.7x
at year-end FY2022 and settle between 4.5x-5.0x in 2023 and 2024.
Fitch's assumption for mid- to high-single digit volume declines
and lumber prices around USD475 to USD500 per thousand board feet
leads to higher debt to EBITDA next year, although still below
Fitch's negative rating sensitivity of debt to EBITDA above 5.5x
for the 'B' IDR. Fitch's forecast also assumes modest FCF is
applied toward debt reduction during 2H22 and in 2023.
Low EBITDA and FCF Margins: DBM's profitability metrics are low
relative to more highly-rated peers and large distributor peers but
are commensurate with 'B' category building products issuers.
Fitch-adjusted EBITDA margins (including capitalized lease costs as
operating expenses) are forecast to be between 5%-6% during the
rating horizon, below the 7%-8% levels in 2020 and 2021 when the
company reported higher volumes and elevated lumber prices. Fitch
expects the company will generate flat to modestly positive FCF
margins during the next few years, compared to more volatile FCF
generation before the Hixson acquisition when the company was
smaller and applied most of its FCF towards dividends.
Susceptibility to Lumber Volatility: Doman's revenues are highly
concentrated towards the sale of lumber. The company estimates
about 65% of sales are from pressure treated lumber. The remaining
35% of sales are from the company's building products distribution
sales, which also includes some sale of lumber. The company's high
lumber exposure weighs negatively on the rating due to the
commoditized nature of the product offering and volatility of
pricing, particularly in recent years. U.S. lumber prices have
declined by about two-thirds from their recent March 2022 high,
which will contribute to lower revenue and EBITDA levels in 2023.
Competitive Position: DBM's position is weaker than more highly
rated building products manufacturers in Fitch's coverage due to
its position as a two-step distributor in the building products
supply chain, its relatively low brand equity and mostly
commoditized product offerings. However, company's scale and
position as the number two pressure treated wood manufacturer in
North America position it well within the two-step distribution
subsector. Fitch believes this scale and manufacturing capacity
provide modest competitive advantages relative to distributors with
only local presences and niche product offerings
Capital Allocation and Dividends: Fitch expects management to apply
modest amounts of FCF after dividends towards debt reduction during
the rating horizon, which is consistent with management's strategy
of maintaining a flexible balance sheet and relatively conservative
credit metrics. The company has also demonstrated willingness in
the past to protect credit metrics via equity issuances and
dividend reductions opportunistically and during periods of
uncertainty. Fitch expects common dividends to be CAD48-50 million
annually during the next few years.
Cyclical End-Market Exposure: Fitch expects housing activity will
fall mid- to high-single digits in 2023 while repair and remodel
spending is forecast to decline slightly. The majority of DBM's
sales are directed to the Canadian and U.S. residential real estate
markets. Management estimates that about half of the company's
distribution sales are exposed to residential new housing and the
other half exposed to repair and remodel demand, which is less
cyclical. The company's wood pressure sales have modest exposure to
agricultural and industrial end-markets. DBM's pressure treated
wood sales are highly exposed to decking and fencing demand, which
Fitch believes experienced a pull forward in demand during the
pandemic.
DERIVATION SUMMARY
Fitch expects DBM to maintain credit metrics that are modestly
stronger than its closest Fitch-rated peer, LBM Acquisition, LLC
(LBM; B/Stable). LBM is less exposed to the volatile lumber market
than DBM, has greater scale and typically maintains slightly higher
EBITDA and FCF margins. LBM's highly aggressive capital allocation
strategy weighs negatively on its credit profile when compared to
DBM. Park River Holdings, Inc. (Park River; B/Negative) has a
stronger margin profile and less commoditized product offering than
DBM but maintains higher leverage levels than DBM.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Revenues grow 17%-18% in 2022 and declines 25%-30% in 2023;
- EBITDA margin of 5%-5.5% in 2022 and 5.5%-6% in 2023;
- FCF margin of 3%-3.5% in 2022 and 1.0%-2.0% in 2023;
- Debt/EBITDA of 3.5x-4.0x at year-end 2022 and 4.5x-5.0x at
year-end 2023.
KEY RECOVERY RATING ASSUMPTIONS
- The recovery analysis assumes that Doman Building Materials Group
Ltd. would be considered a going-concern rather than liquidated in
a recovery scenario.
- Fitch has assumed a 10% administrative claim.
- Fitch has assumed an EV multiple of 5.5x
- Going concern EBITDA of CAD105 million
- Going Concern EBITDA Approach
Fitch's GC EBITDA estimate of CAD105 million estimates a
post-restructuring sustainable EBITDA. This is about 40% below
Fitch calculated LTM EBITDA and 34% below forecasted FY2022
levels.
The GC EBITDA is based on Fitch's assumption that distress would
arise from a meaningful and continued decline in the residential
housing market combined with lumber prices sustained at below
average levels. Fitch estimates that revenues of about CAD2 billion
(about 33% below June 30, 2022 LTM levels and forecasted 2022
levels) and EBITDA margins of about 5.3% would capture the lower
revenue base of the company after emerging from the downturn in a
lower lumber price environment than 2020-2022, plus a sustainable
margin profile after right sizing, which leads to Fitch's CAD105
million GC EBITDA assumption.
Fitch assumed a 5.5x enterprise value (EV) multiple to calculate
the GC EV in a recovery scenario. The company purchased Hixson
Lumber Sales in June 2021 for 5.0x Fitch-calculated FY2020 EBITDA
and 10.9x FY2019 EBITDA. The 5.5x GC EBITDA multiple is below the
6.0x multiple applied in the recovery analysis of LBM Acquisition,
LLC, mainly due to Doman's relatively smaller scale, less
diversified business and weaker profitability metrics when compared
to LBM.
Priority claims over the unsecured debt include the ABL revolver
and about CAD16.1 million of other secured debt. Fitch assumes the
ABL has CAD350 million outstanding at the time of a potential
recovery, which accounts for shrinkage in the available borrowing
base during a period of deflating lumber prices and contracting
volumes that causes a default. Remaining claims are recovered by
the unsecured debtholders, resulting in a recovery corresponding to
an 'RR4' for DBM's 2023 and 2026 unsecured notes.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Fitch's expectation that total debt to operating EBITDA will be
sustained below 4.0x;
- Fitch's expectation that the company will maintain FCF margins
(after dividends) in the low- to mid-single digit percentages;
- The company significantly lowers its proportion of sales from
lumber or reduces exposure to the cyclical new home construction
market in order to reduce earnings and credit metric volatility
through lumber and housing cycles;
- The company maintains a strong liquidity position with no
material short-term debt obligations.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Fitch's expectation that total debt to operating EBITDA will be
sustained above 5.5x;
- Total available liquidity maintained below CAD50 million;
- Fitch's expectation that FCF generation (after dividends) will be
sustained at neutral or negative levels;
- Significant and sustained contraction in lumber prices leading to
Fitch's expectation for meaningfully higher leverage levels (above
5.5x total debt to operating EBITDA) or a potential covenant breach
under the ABL credit agreement.
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: DBM has adequate liquidity with about CAD171
million of borrowing availability under its CAD500 million ABL
revolver (CAD323.6 million of outstandings) as of June 30, 2022 and
CAD3 million of cash. During the last nine months, the company has
maintained about CAD100-200 million of excess availability on its
ABL.
Fitch believes current liquidity is adequate to fund operations and
fixed charges, but the company has limited cushion to avoid a
challenging liquidity scenario, particularly during a stressed
environment where the company generates negative FCF and capital
markets access worsens. Fitch forecasts the company to generate
slight to modestly positive FCF after dividends in its rating case
and to pay down its ABL over time, leading to a moderately
improving liquidity position during the next few years.
Debt Maturities: DBM's debt maturities are well-laddered, including
CAD2.7 million of annual amortization under its non-revolving term
loan, CAD60 million of unsecured notes maturing in 2023, and the
remaining CAD12.1 million non-revolving term loan maturing in 2024.
Fitch expects the company to refinance unsecured notes or draw on
its ABL to meet this maturity. The ABL is currently set to mature
in 2024.
ISSUER PROFILE
Doman Building Materials Group Ltd. (DBM; Doman) is a manufacturer
and distributor of lumber products and building materials in the
U.S. and Canada.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch adds back merger and integration expense and stock-based
compensation to operating EBITDA. Per Fitch's criteria, operating
lease liabilities are not considered debt. Fitch deducts lease
amortization and lease interest expense from operating EBITDA. This
totals about CAD26 to CAD27 million annually. Fitch's calculation
of total debt includes the 2023 and 2026 unsecured bonds, ABL
borrowings outstanding, promissory notes outstanding, term loans
and bank overdrafts.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Doman Building
Materials Group
Ltd. LT IDR B Affirmed B
senior unsecured LT B Affirmed RR4 B
DOUGLAS C. MAULDIN: Proposes to Auction Property Through Heritage
-----------------------------------------------------------------
Douglas C. Mauldin and Sally D. Mauldin ask the U.S. Bankruptcy
Court for the Northern District of Mississippi to authorize their
auction sale of (i) a Kubota MB-131DTC-F tractor identified by
serial number 10110 combined with a Kubota LA2255 front end loader
identified by serial number A0507 and forks; and (ii) a shipping
container, through Heritage Auction & Real Estate Inc.
On the date of filing of the case, Debtor 1 was and continues to be
the record owner of the Tractor and Equipment and the Container
which was used to store personal property owned by the Debtors.
None of these items identified have been claimed as exempt
property. Thus, the property constitutes property of the estate.
The Debtors no longer have a location to store the Tractor and
Equipment and the personal property stored in the Container has
been moved from its location in Tennessee. Thus, it will benefit
the Bankruptcy Estate to sell them.
Debtor 1 executed an agreement with Heritage to sell the Container
and the Tractor and Equipment at an auction. The Debtors and Jeff
Wilkes, the owner of Heritage, understand that the contract and the
sale of the items must be approved by the U.S. Bankruptcy Court.
Wilkes believes that the sale of the Tractor and Equipment for
sufficient funds to net Debtor 1 the sum of $70,000 or more at the
Auction. Wilkes
and the Debtors believe that the sale of the tractor for the
sufficient funds to net Debtor 1 $70,000 is a fair and equitable
price for the Tractor and Equipment. Thus, per the Contract,
Debtor 1 must net $70,000 or more to conclude the sale.
The only lien on the Tractor and Equipment is Kubota Credit Corp.
and the lien as of the Petition Date was $54,631.21, which included
a principal balance, accrued interest as of the Petition Date of
$0.58 and late charges in the amount of $384.42. As an oversecured
claim, Kubota is entitled to interest at the contract rate of 0.99%
on its principal balance, which from the Petition Date through
Sept. 23, 2022 which will total approximately $369.31, resulting in
a total payoff balance of approximately $55,000.52. However, the
actual amount being paid will be the amount of the payoff as
calculated by Kubota and agreed upon by the Debtors. Thus, the
Bankruptcy Estate will receive approximately $15,000 or more from
the sale of the Tractor and Equipment.
Wilkes believes that the Container will sell for $3,000 or more.
Wilkes and the Debtor 1 both believe that the sale of the Container
with a net to Debtor 1 is a fair and equitable price. Since there
is no lien on the Container, the Bankruptcy Estate will receive
$3,000 or more from the sale of the Container.
If the Debtors Motion is not granted, they will be forced to rent a
location to store the Tractor and Equipment and the Container as
they will no longer be able to store the Tractor and Equipment at
no monthly costs. Thus, the Bankruptcy Estate will benefit from
the sale by preventing the need for monthly storage rental fees and
generating $18,000 or more for the benefit of the Bankruptcy
Estate.
Heritage will be paid by the purchasers of the items that make bids
on the Tractor and Equipment and on the Container by a payment of a
10% premium above the bid made by the purchasers of the items in
the Auction. Thus, a bid of $70,000 on the Tractor and Equipment
will net $70,000 to Debtor 1, and the purchaser will pay an
additional $7,000 to Heritage.
Should either of the items not result in a bid sufficient to net
Debtor 1 $70,000 for the Tractor and Equipment or net the Debtor 1
$3,000 for the sale of the Container, the Debtors will re-notice
all parties in interest on the mailing matrix of any future auction
date(s).
A copy of the Contract is available at https://tinyurl.com/yck3j2ae
from PacerMonitor.com free of charge.
Douglas C Mauldin and Sally D Mauldin sought Chapter 11 protection
(Bankr. N.D. Miss. Case No. 22-10289) on Feb. 14, 2022.
DUNBAR PLAZA: Unsec. Creditors Owed $269K to Split $150K in Plan
----------------------------------------------------------------
Dunbar Plaza, Inc., submitted a Combined Disclosure Statement and
Liquidation Plan.
The Debtor is holding the sum of $225,309. These monies represent
the balance of the net sale proceeds from the sale of real property
owned by the Debtor. The Debtor has previously paid administrative
expenses in the sum of $7,285. Any additional administrative
expenses will be paid only after approval by the U.S. Bankruptcy
Court.
The Debtor continued to make payments to Putnam County Bank until
2021 when the Chapter 11 case was filed. The purpose of the
Chapter 11 case was to sell and liquidate property. The hotel
property was sold for 1,800,000 and Putnam County Bank received the
net proceeds from the sale of the 10th Street property except for
the $150,000 amount which was held back. The $150,000 represented
the value of the personal property which was sold as a part of the
transaction. Putnam County Bank failed to properly perfect its
lien on the personal property.
The Spring Hill property was sold for $100,000 pursuant to Court
Order by the U.S. Bankruptcy Court. The proceeds were placed in
escrow because there was no lien against that property. Those
monies are part of the distribution to be made under this Plan.
All monies to be distributed will be distributed to the two classes
of unsecured creditors - Class I and Class II. Class I will
receive $150,000 and Class II will receive $75,309 less
administrative expense. This represents all that can be paid and
if the case were converted to a Chapter 7, there would be
additional administrative expenses of a Chapter 7 Trustee. The
$150,000 distribution in Class I represents a portion of the net
sale proceeds from the hotel/motel situate at 1007 10th Street,
Dunbar, West Virginia. Putnam County Bank held a lien against the
"bricks and mortar" but failed to properly perfect its lien on the
personal property. The sale was accomplished by allocating
$150,000 of the total sale price of $1,800,000 to the personal
property. Because Putnam County Bank failed to put itself in the
position of a secured creditor, the Debtor has elected under the
provisions of 11 U.S.C. Sec. 510 to subordinate Putnam County
Bank's unsecured claim out of the $150,000 Class II pool. The
unperfected lien of Putnam County Bank is transferred to the estate
and subordinated to allow other unsecured general claims to be paid
before the Bank.
Class II represents the balance of the monies held by the
bankruptcy estate, including funds received from the sale of the
two-acre parcel in South Charleston. Putnam County Bank did not
hold a lien on the South Charleston property and its remaining
claim as a general unsecured creditor is recognized in Class II on
a pro-rata basis.
The Plan will treat claims as follows:
* Class UC-1 Unsecured creditors other than Putnam County Bank
are identified on the exhibit attached and designated as Class I.
Those creditors will share, pro rata, the sum of $150,000.
Creditor claims in Class I total the sum of $269,284. Payments in
this class represent the balance of the monies held by the Debtor.
This class exists because the Putnam County Bank claim has been
subordinated to the $150,000 holdback.
* Class UC-II represents the balance of distributions to be made
to unsecured creditors after payment of the $150,000 sum as
identified in Class I. This class does include a distribution to
Putnam County Bank. The total amount available for payment to
creditors in this class is $75,309. Class II represents a pro-rata
payment to Putnam County Bank because its secured claim on personal
property was not properly perfected.
Attorney for the Debtor:
Joseph W. Caldwell, Esq.
CALDWELL & RIFFEE, PLLC
P.O. Box 4427
Charleston, WV 25364
E-mail: jcaldwell@caldwellandriffee.com
A copy of the Combined Disclosure Statement and Liquidation Plan
dated Oct. 19, 2022, is available at https://bit.ly/3DdoLTg from
PacerMonitor.com.
About Dunbar Plaza
Dunbar, W.Va.-based Dunbar Plaza, Inc., filed a petition for
Chapter 11 protection (Bankr. S.D. W.Va. Case No. 21-20221) on
Sept. 23, 2021, with as much as $10 million in both assets and
liabilities. Carl Higginbotham, president of Dunbar Plaza, signed
the petition.
Judge B. Mckay Mignault oversees the case.
Joseph W. Caldwell, Esq., at Caldwell & Riffee, PLLC is the
Debtor's lead bankruptcy counsel. Matthew M. Johnson, Esq., a
practicing attorney in Charleston, W.Va., serves as Mr. Caldwell's
co-counsel.
EAST COAST DIESEL: Seeks to Tap Sasser Law Firm as Legal Counsel
----------------------------------------------------------------
East Coast Diesel LLC seeks approval from the U.S. Bankruptcy Court
for the Middle District of North Carolina to hire Sasser Law Firm
as its legal counsel.
Sasser Law Firm will represent and assist the Debtor in carrying
out its duties under the provisions of Chapter 11 of the Bankruptcy
Code.
The firm received a retainer in the amount of $5,000.
Philip Sasser, Esq., an attorney at Sasser Law Firm, disclosed in a
court filing that his firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Philip Sasser, Esq.
Sasser Law Firm
2000 Regency Parkway, Suite 230
Cary, NC 27518
Telephone: (919) 319-7400
Facsimile: (919) 657-7400
Email: philip@sasserbankruptcy.com
About East Coast Diesel
East Coast Diesel, LLC handles any major or minor truck and fleet
repair. It delivers professional fleet repair and maintenance
services on the East Coast since 2013.
East Coast Diesel LLC filed a petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. M.D.N.C. Case No. 22-80197) on Oct.
12, 2022. In the petition filed by its member and manager, Robert
Michael, the Debtor reported between $1 million and $10 million in
both assets and liabilities.
The Debtor is represented by Travis Sasser of Sasser Law Firm.
ECHOSTAR CORP: Egan-Jones Retains BB- Senior Unsecured Ratings
--------------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by EchoStar Corporation.
Headquartered in Englewood, Colorado, EchoStar Corporation operates
satellite communication infrastructures.
ELITE HOME: Unsecureds to Get 7% to 14% in Committee Plan
---------------------------------------------------------
The Official Committee of Unsecured Creditors of Elite Home
Products, Inc., filed a Proposed Plan of Chapter 11 Plan of
Liquidation and a Disclosure Statement for the Debtor on Oct. 21,
2022.
The Debtor commenced the Chapter 11 case aiming to pursue an
orderly winddown of its business with the goal to pay down the
Debtor's secured obligations to M&T Bank. Shortly after filing the
Chapter 11 Case, the Debtor started receiving a variety of interest
in the Debtor's business and business assets, although the Debtor
did not undertake efforts to promote the sale of such assets.
In April 2022, the Debtor retained Getzler to assist the Debtor
with preparing due diligence packages to provide to interested
parties. The Debtor stated that it received 8 NDAs that were
executed by interested parties to whom due diligence packages were
provided. Following its discussions with potential purchasers, the
Debtor described the interest in its business as "limited and
modest at best[,]" and that interested parties primarily focused on
the Debtor's (a) goodwill; (b) intellectual property; and (c)
business with Amazon and inventory maintained at Amazon
(collectively, the "Non-Warehouse Assets"). The Debtor also
received limited interest in the remaining inventory stored in its
warehouse (the "Warehouse Inventory"), which the Debtor described
as constituting "mainly odds and ends, broken sets, unique sets,
and older styles."
Based on the limited interest received from prospective purchasers,
the Debtor refrained from engaging in further advertising or
promotion of its assets and pursued these bankruptcy sales:
1. Warehouse Inventory Sale
On May 25, 2022, the Debtor filed its motion requesting,
inter alia, the Bankruptcy Court to approve the sale of its
Warehouse Inventory to Hilco Wholesale Solutions, LLC, for $70,000.
On May 31, 2022, the Bankruptcy Court entered an order authorizing
the Debtor to close on the sale.
2. Subject Asset Sale
On May 28, 2022, the Debtor filed a motion requesting, inter
alia, seeking authority to proceed with a bidding and auction
process in order to consummate a sale of the Debtor's Non-Warehouse
Assets. On June 7, 2022, the Bankruptcy Court entered an order
approving bidding procedures with respect to the sale of the
Non-Warehouse Assets. The Debtor proposed to sell the
Non-Warehouse Assets in a joint bid of $86,000, subject to higher
and better offers. On June 28, 2022, after the Debtor failed to
receive an offer in excess of the Stalking Horse Bid, the
Bankruptcy Court entered an order authorizing the Debtor to close
on the Non-Warehouse Asset Sale.
The proceeds generated by the Asset Sales are currently held by the
Debtor, and are expected to be available for distribution under the
Plan.
Pursuant to the Plan, the Creditors Committee proposes an orderly
liquidation of the Debtor's remaining Assets. The Plan provides
that all funds realized from the collection and liquidation of the
Debtor's assets will be paid to creditors on account of their
allowed claims in accordance with the distributive priorities of
the Bankruptcy Code and the Plan.
The Plan will be implemented by establishing a Liquidation Trust
that will be administered by the Liquidation Trustee. On the
Effective Date, the Debtor's Assets will be transferred to the
Liquidation Trust for the benefit of Holders of Allowed Claims.
Thereafter, the Liquidation Trustee will be responsible for
liquidating the assets, including the pursuit and resolution of any
Causes of Action in accordance with the terms of the Plan.
Under the Plan, holders of Class 3 General Unsecured Claims will
receive its Pro Rata Distribution from the Liquidation Trust as
determined by the Liquidation Trustee in accordance with the Plan
and the Liquidation Trust Agreement. Unsecured creditors are
projected to recover 7% to 14% of their claims. Class 3 is
impaired.
Based on an initial review of the claims filed in the case, it is
estimated that the total allowed general unsecured claims will be
approximately $7,000,000 to $13,000,000. The Committeefurther
projects that at least approximately $1,000,000 will be available
to satisfy the Allowed General Unsecured Claims. The actual amount
distributed to Holders of Class 3 General Unsecured Claims (and the
timing any such distributions) will vary based on the Assets
recovered and the reconciled amount of General Unsecured Claims
that are Allowed.
A copy of the Disclosure Statement dated Oct. 21, 2022, is
available at https://bit.ly/3gnKSNK from PacerMonitor.com.
About Elite Home Products
Elite Home Products, Inc., a home textile company in Saddle Brook,
N.J. At the peak of its operations, the Debtor supplied a wide
variety of finished textile products, including sheets sets, duvet
sets, blankets, towels, quilts, and comfortable ensembles, and
offered specialized distribution methods for wholesalers and
retailers of various sizes.
Elite Home Products sought bankruptcy protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. D.N.J. Case No. 22-12353) on
March 24, 2022, with $6,314,175 in assets and $11,104,637 in
liabilities. Scott R. Perretz, president of Elite Home Products,
signed the petition.
The Debtor tapped Genova Burns, LLC as bankruptcy counsel; Winne
Banta Basralian and Kahn, P.C. as special counsel; Getzler Henrich
and Associates, LLC as financial advisor; and SAX, LLP as
accountant.
EMPACADORA Y PROCESADORA: Secured Creditor Says In Talks w/ Debtor
------------------------------------------------------------------
Secured creditor Banco Popular de Puerto Rico ("BPPR") requests a
short extension of the deadline to submit its position as to the
confirmation of Empacadora y Procesadora Del Sur, Inc.'s First
Amended Chapter 11 Plan (the "Plan").
After several procedural events, on Aug. 19, 2022, the Debtor filed
the Plan. On Sept. 1, 2022, the Court entered an order approving
the disclosure statement related to the Plan, scheduling a hearing
on confirmation for Nov. 4, 2022.
Further, pursuant to the Order, (i) "acceptances or rejections of
the Plan may be filed in writing by the holders of all claims on/or
before 14 days prior to the date of the hearing on confirmation of
the Plan" and (ii) "any objection to confirmation of the plan shall
be filed on/or before 14 days prior to the date of the hearing on
confirmation of the Plan".
At this juncture, although the Debtor and BPPR are actively engaged
in communications to attempt to reach and finalize a consensual
resolution of the matters pending between them in the captioned
case, a final written agreement has not yet been executed.
Thus, to allow the parties to continue such communications, BPPR
requests that the deadline to submit its position as to the
Confirmation of the Plan, and to submit its votes in connection
therewith, be extended until October 28, 2022.
Attorneys for Banco Popular de Puerto Rico:
Luis C. Marini-Biaggi, Esq.
Carolina Velaz-Rivero, Esq.
Ignacio Labarca-Morales, Esq.
MARINI PIETRANTONI MUÑIZ
250 Ponce De Leon Ave., Suite 900
San Juan, PR 00918
Tel: (787) 705-2171
E-mail: lmarini@mpmlawpr.com
cvelaz@mpmlawpr.com
ilabarca@mpmlawpr.com
About Empacadora Y Procesadora Del Sur
Empacadora Y Procesadora Del Sur, Inc., sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R. Case No.
22-00354) on Feb. 15, 2022. In the petition signed by Carlos C.
Rodriguez Alonso, president, the Debtor disclosed $11,604,565 in
assets and $10,598,204 in liabilities.
Alexis Fuentes Hernandez, Esq., at Fuentes Law Office represents
the Debtor as counsel.
ENPRO INDUSTRIES: Egan-Jones Keeps BB+ Senior Unsecured Ratings
---------------------------------------------------------------
Egan-Jones Ratings Company, on September 13, 2022, retained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by EnPro Industries, Inc.
Headquartered in Charlotte, North Carolina, EnPro Industries, Inc.
designs, develops, manufactures, and markets proprietary engineered
industrial products.
ESCADA AMERICA: Exclusivity Period Extended to Jan. 13
------------------------------------------------------
Escada America, LLC obtained a court order extending its exclusive
right to file a Chapter 11 plan to Jan. 13, 2023, and solicit
acceptances from creditors to March 13, 2023.
The ruling by Judge Sheri Bluebond of the U.S. Bankruptcy Court for
the Central District of California allows the company to pursue its
own plan for emerging from Chapter 11 protection without the threat
of a rival plan from creditors.
Escada America needs additional time to work on a second amended
plan so as to account for any additional input on the plan that the
company may receive from the unsecured creditors' committee,
according to its attorney, Jonathan Gottlieb, Esq., at Levene,
Neale, Bender, Yoo & Golubchik, LLP.
Escada America filed its Chapter 11 plan of reorganization on May
12, which proposes to pay general unsecured creditors 15 percent of
their claims.
About Escada America
Escada America, LLC, owner of a clothing store in New York, sought
Chapter 11 bankruptcy protection (Bankr. C.D. Calif. Case No.
22-10266) on Jan. 18, 2022. In the petition filed by Kevin Walsh,
director of finance, the Debtor listed $1 million to $10 million in
both assets and liabilities.
Judge Sheri Bluebond oversees the case.
John Patrick M. Fritz, Esq., at Levene, Neale, Bender, Yoo &
Golubchik, LLP serves as the Debtor's legal counsel while
Holthouse, Carlin & Van Trigt, LLP is the Debtor's accountant.
On May 18, 2022, the U.S. Trustee for Region 16 appointed an
official committee of unsecured creditors in this Chapter 11 case.
Kelley Drye & Warren, LLP serves as the committee's legal counsel.
The Debtor filed its proposed Chapter 11 plan of reorganization and
disclosure statement on May 12, 2022.
EXTERRAN ENERGY: Moody's Withdraws 'B1' CFR on Notes Repayment
--------------------------------------------------------------
Moody's Investors Service withdrew all of Exterran Energy
Solutions, L.P.'s (EESLP or Exterran) ratings, including its B1
Corporate Family Rating, B1-PD Probability of Default Rating, B3
senior unsecured notes rating and SGL-3 Speculative Grade Liquidity
rating. The outlook was changed to rating withdrawn from positive.
These withdrawals follow repayment of the notes in conjunction with
the closing of the acquisition of Exterran by Enerflex Ltd.
(Enerflex, B1 positive).
Withdrawals:
Issuer: Exterran Energy Solutions, L.P.
Corporate Family Rating, Withdrawn, previously rated B1
Probability of Default Rating, Withdrawn, previously
rated B1-PD
Speculative Grade Liquidity Rating, Withdrawn, previously
rated SGL-3
Gtd Senior Unsecured Regular Bond/Debenture, Withdrawn,
previously rated B3 (LGD5)
Outlook Actions:
Issuer: Exterran Energy Solutions, L.P.
Outlook, Changed To Rating Withdrawn From Positive
RATINGS RATIONALE
Exterran has fully repaid its senior unsecured notes due 2025 in
conjunction with the closing of the acquisition of Exterran by
Enerflex. All of Exterran's ratings have been withdrawn since all
of its rated debt is no longer outstanding.
Exterran Corporation provides contract compression services to the
oil and gas industry as well as processing and compression
equipment manufacturing and aftermarket services, and now is a
wholly owned subsidiary of Enerflex Ltd. EESLP is a wholly owned
subsidiary of Exterran Corporation.
EXWORKS CAPITAL: Abrahams Parties Object Claims Estimation
----------------------------------------------------------
Randolph Abrahams and RedRidge Finance Group, LLC (collectively,
the "Abrahams Parties"), object to the motion of Exworks Capital,
LLC for an order approving the Disclosure Statement.
Abrahams Parties claim that the principal infirmities to the
Disclosure Statement include, without limitation, the following:
* The Disclosure Statement provides no information, let alone
adequate information under 11 U.S.C. § 1125, regarding potential
creditor recoveries under the Plan based on the possible outcomes
of the Litigation.
* The Disclosure Statement also misleads creditors by
asserting that "Debtor does not believe there is any alternative
[to the Plan] at this time that would result in greater recoveries
to Holders of Claims than those described herein." Debtor is well
aware that the Abrahams Parties and certain other defendants in the
Litigation made a settlement proposal several weeks ago – which
Debtor rejected without a realistic counter or any discussion –
that offered a viable alternative creditors could reasonably view
as superior to Debtor's proposed litigation path.
Abrahams Parties point out that the Plan, as proposed, also
contains many infirmities that preclude its confirmation,
including, without limitation, the following:
* The Plan blatantly attempts to improperly gerrymander an
impaired consenting class by separating a single group of similarly
situated general unsecured creditors into numerous classes with
different treatment for no legally cognizable reason.
* The Plan contains overly-broad releases, including Debtor
releases of existing claims against Debtor's existing equity
holders and other insiders that were the subject of the Member
Demand letter described in the Plan.
In addition, the Abrahams Parties object to the claims estimation
procedures proposed in the Motion in the event that Debtor seeks
approval of such procedures at this time. The Motion, but not the
proposed Interim Approval and Procedures Order, proposes that (i)
claimholders be prohibited from voting if, within ten days of the
Voting Deadline, a claim objection has been filed unless the Court
enters an order fully adjudicating such objection or temporarily
allowing the claim or the objection is otherwise resolved, and (ii)
claims be allowed in certain amounts set forth in the Motion for
voting purposes.
Abrahams Parties state that the proposed timing for resolving the
amount of claims subject to an objection for voting purposes is
completely unrealistic and inequitable, as it could leave claimants
with less than 10 days to file and seek Court resolution of a 3018
motion. To remedy this, as this Court has done in numerous other
cases, the Court should establish a deadline for the Debtor or any
other party to file such objections to claims for voting purposes
with any such objections being heard at the Confirmation Hearing.
Finally, to the extent Debtor seeks to set in stone the Abrahams
Parties' respective claim amounts for voting purposes at this time,
the Abrahams Parties object and request that their claims be
allowed in increased amounts for voting purposes to account for
additional defamation related claims and increases in their
advancement claims that continue to accrue since the filing of
their proofs of claim. The Abrahams Parties intend to amend their
claims to account for such increases in the near term.
A full-text copy of the Abrahams Parties' objection dated October
24, 2022, is available at https://bit.ly/3WjN9Kj from
PacerMonitor.com at no charge.
Attorneys for the Abrahams Parties:
Michael J. Diver, Esq.
Peter P. Knight, Esq.
Sarah K. Weber, Esq.
Michael J. Lohnes, Esq.
Allison E. Yager, Esq.
Kenneth N. Hebeisen, Esq.
KATTEN MUCHIN ROSENMAN LLP
525 W. Monroe Street
Chicago, IL 60661-3693
michael.diver@katten.com
peter.knight@katten.com
sarah.weber@katten.com
michael.lohnes@katten.com
allison.yager@katten.com
ken.hebeisen@katten.com
(312) 902-5200
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, 2022, 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.
FIACA ASSOCIATES: Case Summary & 11 Unsecured Creditors
-------------------------------------------------------
Debtor: Fiaca Associates
137 South Rutherford Avenue
Franklin, NJ 07416
Business Description: The Debtor owns a 10,000 square foot
unoccupied commercial building located at
525 Route 515, Vernon, New Jersey valued at
$1.1 million.
Chapter 11 Petition Date: October 28, 2022
Court: United States Bankruptcy Court
District of New Jersey
Case No.: 22-18565
Debtor's Counsel: Stephen B. McNally, Esq.
MCNALLYLAW, LLC
93 Main Street
Suite 201
Newton, NJ 07860
Tel: 973-300-4260
Fax: 973-300-4264
Email: steve@mcnallylawllc.com
Total Assets: $1,100,000
Total Liabilities: $1,118,596
The petition was signed by Carlos Fardin as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 11 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/HXRCKMY/Fiaca_Associates__njbke-22-18565__0001.0.pdf?mcid=tGE4TAMA
FINANCIAL INVESTMENTS: Judgment Creditors Oppose Disclosures
------------------------------------------------------------
Monique Moise, Shadonna Charleston, and Rasheeda Lawler
(collectively "the Judgment Creditors") object to the adequacy of
the Amended Disclosure Statement for Debtor's Amended Plan of
Reorganization being proposed by Financial Investments and Real
Estate, LLC.
The Judgment Creditors point out that the Amended Disclosure
Statement describes the Amended Plan as, among other things,
providing relief in the event of non-payment after notice, but does
not state whether that is relief against the Debtor and its
co-defendants.
The Judgment Creditors further point out that the Amended
Disclosure Statement fails to set forth information of a kind, and
in sufficient detail, to enable creditors to make an informed
decision regarding acceptance or rejection of the Plan, as required
pursuant to 11 U.S.C. Sec. 1125, as it is not consistent with the
terms in the Amended Plan:
* The Amended Disclosure Statement states that the Amended Plan
includes a stay against Debtor's co-judgment debtors on the State
Judgment, but the Amended Plan does not include that provision.
* The Amended Disclosure Statement states that the Amended Plan
includes an ambiguous remedy for non-payment to the Judgment
Creditors, but the Amended Plan does not include relief in the
event of non-payment.
* The Amended Disclosure Statement describes an Amended Plan
that does not address prepayment by Cyndescope, in which case the
Judgment Creditors should be entitled to prepayment of their claims
at the time of prepayment.
* The Amended Disclosure Statement describes an Amended Plan
that does not provide for the Judgment Creditors to be paid for
legal fees that have not yet been liquidated.
Attorneys for Monique Moise, Shadonna Charleston, and Rasheeda
Lawler:
Robert A. Badman, Esq.
CURTIN & HEEFNER LLP
1040 Stony Hill Road, Suite 150
Yardley, PA 19067
Telephone: (215) 736-2521
Facsimile: (215) 736-3647
About Financial Investments
Financial Investments and Real Estate, LLC, is a Pennsylvania-based
real estate and financial investments company.
Financial Investments and Real Estate sought Chapter 11 bankruptcy
protection (Bankr. E.D. Pa. Case No. 22-11150) on May 3, 2022,
listing as much as $500,000 in both assets and liabilities. Kathryn
Anderson, managing member, signed the petition.
The case is assigned to Judge Magdeline D. Coleman.
Michael A. Cataldo, Esq., at Gellert, Scali, Busenkell & Brown,
LLC, is the Debtor's counsel.
FLUOR CORP: Egan-Jones Retains B Senior Unsecured Ratings
---------------------------------------------------------
Egan-Jones Ratings Company, on September 21, 2022, retained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by Fluor Corporation.
Headquartered in Irving, Texas, Fluor Corporation provides oil and
gas infrastructure construction services.
FOSSIL GROUP: Egan-Jones Keeps B- Senior Unsecured Ratings
----------------------------------------------------------
Egan-Jones Ratings Company, on September 12, 2022, retained its
'B-' foreign currency and local currency senior unsecured ratings
on debt issued by Fossil Group, Inc. EJR also retained its 'B'
rating on commercial paper issued by the Company.
Headquartered in Richardson, Texas, Fossil Group, Inc. designs,
develops, markets, and distributes consumer fashion accessories.
FRALEG GROUP: Nov. 16 Hearing on Disclosures and Plan
-----------------------------------------------------
Judge Jil Mazer-Marino has entered an order conditionally approving
the Amended (JMM) Disclosure Statement of Fraleg Group, Inc.
The hearing to consider final approval of the adequacy of the
Amended (JMM) Disclosure Statement and Confirmation of the Amended
Plan will be held before the Honorable Jil Mazer-Marino, United
States Bankruptcy Judge, United States Bankruptcy Court for the
Eastern District of New York, 271-C Cadman Plaza East, Brooklyn,
New York 11201-1800 on Nov. 16, 2022 at 11:00 a.m.
Objections, if any, to the adequacy of the Amended Disclosure
Statement or the Confirmation of the Amended Plan must be in
writing and filed with the Bankruptcy Court by Nov. 9, 2022,
through the Court's electronic filing system.
In order to be counted as a vote to accept or reject the Amended
Plan, a Ballot must be properly executed, completed and received by
Debtor's counsel (JMM) by no later than 5:00 p.m. (Eastern) on
November 9, 2022.
Counsel for the Debtor:
Nico Pizzo, Esq.
LAW OFFICES OF AVRUM J. ROSEN, PLLC
38 New Street
Huntington, NY 11743
About Fraleg Group Inc.
Fraleg Group, Inc., is a single asset real estate debtor (as
defined in 11 U.S.C. Section 101(51B)). It is the fee simple owner
of two properties in East Orange, N.J., having a total current
value of $4 million.
Fraleg Group sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-41410) on June 17,
2022, listing as much as $10 million in both assets and
liabilities. Judge Jil Mazer-Marino oversees the case.
The Debtor's counsel is Avrum J. Rosen, Esq., at the Law Offices of
Avrum J. Rosen, PLLC.
FRONT SIGHT: Files Supplement to Reorganization Plan
----------------------------------------------------
Front Sight Management LLC submits a supplement to its Second
Amended Chapter 11 Plan of Reorganization dated October 21, 2022.
As set forth in the Disclosure Statement, the Debtor intended on
including in this Plan Supplement a copy of the Consulting
Agreement between Dr. Piazza and the Reorganized Debtor. However,
the Consulting Agreement has yet to be finalized and the Debtor did
not receive authorization from counsel for Dr. Piazza or counsel
for the New Equity Investor to file the current version of the
Consulting Agreement.
As further set forth in the Disclosure Statement, the Debtor also
intended on including in this Plan Supplement certain documents and
agreements including but not limited to, an amended and restated
operating agreement of the Reorganized Debtor, officer and director
resolutions, an operational budget, and such other agreements as
may be reasonably necessary to effectuate the transactions
contemplated by the Plan. However, the New Equity Investor has not
provided the aforementioned documents to the Debtor at this point
in time and the Debtor's current management will not be in control
of the Reorganized Debtor. The Debtor also does not believe that
most, if not all, of the aforementioned documents are relevant to
Plan confirmation.
The Debtor is intending to include in its proposed Plan
confirmation order (a draft of which will be filed on or before
November 11, 2022) the following language: "Pursuant to Internal
Revenue Code s 1377(a)(2), the Debtor shall "close its books" on
the Effective Date of the Plan. The Debtor shall include the s
1377(a)(2) election on its 2022 timely filed S-Corporation federal
income tax return."
Attorneys for the Chapter 11 Debtor:
Steven T. Gubner, Esq.
Susan K. Seflin, Esq.
Jessica S. Wellington, Esq.
BG LAW LLP
300 S. 4th Street, Suite 1550
Las Vegas, NV 89101
Telephone: (702) 835-0800
Facsimile: (866) 995-0215
E-mail: sgubner@bg.law
sseflin@bg.law
jwellington@bg.law
About Front Sight Management
Front Sight Management LLC specializes in providing courses in gun
training, self-defense martial arts training, and personal safety
-- with firearms or without.
Front Sight filed a voluntary petition for under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Nev. Case No. 22-11824) on May 24,
2022. In the petition signed by Ignatius Piazza, manager, the
Debtor disclosed up to $50 million in both assets and liabilities.
Judge August B. Landis oversees the case.
The Debtor tapped Steven T. Gubner, Esq., at BG Law LLP as
bankruptcy counsel; Greenberg Traurig, LLP as special counsel;
Province, LLC as financial advisor; and Lucas Horsfall as
accountant. Stretto, Inc. is the claims, noticing and solicitation
agent.
FS DIP, LLC, as DIP agent, is represented by Samuel A. Schwartz,
Esq., and Bryan A. Lindsey, Esq., at Schwartz Law, PLLC.
FRONTIER CHURCH: Unsecureds to Split $6K in Consensual Plan
-----------------------------------------------------------
Frontier Church Incorporated filed with the U.S. Bankruptcy Court
for the Middle District of Florida a Plan of Reorganization dated
October 24, 2022.
Frontier is a not-for-profit corporation organized under the laws
of the State of Florida. Frontier is the only multicultural
nondenominational church located in Leesburg, Florida.
Class 3 consists of Allowed Secured Claim of Citizens First Bank.
The holder of the claim will:
* retain the lien securing the claim to the extent of the
allowed amount of the claim; and
* receive on account of such claim deferred cash payments
totaling at least the allowed amount of the claim, of a value, as
of the Effective Date of at least the value of the claimant's
interest in the estate’s interest in the property securing the
claim.
More specifically, this claim (evidenced by Claim number 1) is for
the first priority mortgage on the Sanctuary Property. The Debtor
shall continue to make the regular monthly payments at the
contract/non-default rate of $3,375.00. In addition, the Debtor
accrued non-default interest pre-petition in the amount of
$6,997.98 ("Accrued Interest"). The Debtor will pay the Accrued
Interest in 12 equal monthly installments of $583.08 with payments
commencing on the Effective Date. The loan documents evidencing the
claim shall be assumed. If the Debtor remains current in its
regular monthly payments to Citizens First Bank and pays the
Accrued Interest in full, then the mortgage shall be deemed
reinstated. In addition, the Debtor shall execute such documents as
Citizens First Bank reasonably requests.
Class 4 consists of the Allowed Secured Claim of Emmett Sapp
Builders, Inc. The claim of Emmett Sapp Builders, Inc. ("ESB") is
evidenced by Claim number 5 in the amount of $391,279.24. ESB
asserts that its claim is fully secured by the Sanctuary Property.
The Debtor does not believe ESB's claim is fully secured and
intends to seek a determination as to the value of the ESB claim
pursuant to 11 U. S. C. §506 and F. R. B. P. 3012. To the extent
that any portion of ESB's claim is determined to be an Allowed
Secured Claim, then (i) ESB will retain the lien securing the claim
to the extent of the allowed amount of the claim; and (ii) the
Allowed Secured Claim shall be paid in equal monthly installments
over a period of 10 years. The amount of the monthly payment shall
be calculated by fully amortizing the amount of the Allowed Secured
Claim over 10 years at the Till Rate.
Class 5 consists of All non-priority unsecured claims allowed under
§ 502 of the Code other than Class 3 claims. If Class 5 votes to
accept the Plan, then the Class shall receive the Consensual Plan
Treatment. If Class 5 votes to reject the Plan, then Class 5 shall
receive the Nonconsensual Plan Treatment.
* Consensual Plan Treatment: The Debtor proposes to pay
unsecured creditors a pro rata portion of $6,000.00. Payments will
be made in 12 equal quarterly payments of $500.00. Payments shall
commence on the 15th day of the month following the Effective
Date.
* Nonconsensual Plan Treatment: In full satisfaction of their
Allowed General Unsecured Claims, the Debtor shall devote its
Disposable Income over a 3 year period commencing on the Effective
Date to be paid on a quarterly basis pro rata to Holders of Allowed
Class 2 Claims. Payments shall commence on the first day of the
fourth month after the entry of the Confirmation Order and shall
continue on the first day of each third month thereafter. So long
as the Debtor's Chapter 11 case remains open, the Reorganized
Debtor will, on a quarterly basis commencing on the Effective Date,
file a quarterly report detailing its income and expenses and
calculating its Disposable income for each calendar quarter (which
Disposable Income will be calculated using a cash basis method of
accounting).
The Plan contemplates that the Debtor will continue to manage and
operate its business in the ordinary course, but with restructured
debt obligations. It is anticipated that the revenue from the
Debtor's ongoing operations will be sufficient to make the Plan
Payments.
A full-text copy of the Plan of Reorganization dated October 24,
2022, is available at https://bit.ly/3Ni2qqV from PacerMonitor.com
at no charge.
Attorneys for the Debtor:
Kenneth D. Herron, Jr., Esq.
Herron Hill Law Group, PLLC
P.O. Box 2127
Orlando, FL 32802
Tel: 407-648-0058
Email: chip@herronhilllaw.com
About Frontier Church Incorporated
Frontier Church Incorporated -- https://thefrontierchurch.com/ --
filed a petition for relief under Subchapter V of Chapter 11 of the
U.S. Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-02638) on July
25, 2022, listing between $500,000 and $1 million in assets and
between $1 million and $10 million in liabilities. Jerrett M.
McConnell has been appointed as Subchapter V trustee.
Judge Lori V. Vaughan oversees the case.
Kenneth D. Herron, Jr., Esq., at Herron Hill Law Group, PLLC is the
Debtor's legal counsel.
GATHERING PLACE: HLDSMB Buying Orlando Property for $1.734 Million
------------------------------------------------------------------
The Gathering Place Orlando, Inc., asks the U.S. Bankruptcy Court
for the Middle District of Florida for authority to sell the real
property located at 8287 Curry Ford Road, in Orlando, Florida
32822, to HLDSMB LLC or any of its subsidiary for $1,734,000.
The Debtor intends to fund distributions to creditors through the
sale of its Property, and thus a primary objective of the case is a
value-maximizing sale of the Debtor’s assets. Through the
Motion, the Debtor seeks the Court's approval to effectuate a
Section 363 sales process that will allow it to close the sale
before Nov. 30, 2022.
The Debtor listed on Schedule A the Property. It has (subject to
Court approval) entered into a contract for purchase and sale of
the property for $1,734,000. The Debtor states that it is the fair
market value. Any liens on the Property will attach to the sale
proceeds. Holders of Allowed Secured Claims will be paid at
closing from the proceeds of the sale, without further order of the
Court.
A copy of the Contract is available at https://tinyurl.com/963bk95t
from PacerMonitor.com free of charge.
About The Gathering Place Orlando
The Gathering Place Orlando Inc. -- https://www.tgporlando.org --
operates a church known as The Gathering Place, where everyone is
welcome. Its main operations are conducted from the facilities it
owns at 8287 Curry Ford Road, Orlando, Florida 32822.
On June 30, 2022 The Gathering Place Orlando, Inc., filed a
petition for relief under Subchapter V of Chapter 11 of the
Bankruptcy Code (Bankr. M.D. Fla. Case No. 22-02342). In the
petition filed by Howard Harrison, as president, the Debtor
estimated assets and liabilities between $1 million and $10
million.
Jarrett McConnell has been appointed as Subchapter V trustee.
Jeffrey Ainsworth, Esq., at BransonLaw PLLC, is the Debtor's
counsel.
GOOD GUYZ: Court Approves Sale of Miami Property to SK Florida
--------------------------------------------------------------
Judge Laurel M. Isicoff of the U.S. Bankruptcy Court for the
Southern District of Florida authorized Good Guyz Investments,
LLC's sale of the real property located at 1920 NE 208th Terrace,
in Miami, Florida 33179, to SK Florida Homes LLC.
The Real Property bears the following legal description: Lot 6,
Block 25, of HIGHLAND LAKES SECTION SIX, according to the plat
thereof as recorded in Plat Book 73, Page 48, of the Public Records
of Miami-Dade County, Florida.
The sale is free and clear of all liens, claims and encumbrances.
In connection with the closing of the sale of the Real Property,
the Debtor and any escrow or closing agent are authorized and
directed to pay DLJ Mortgage Capital, LLC the amount due as stated
under its Final Judgment of Mortgage Foreclosure, as agreed upon
with SK and SKFL. All amounts described will be included in any
settlement statement, closing statement, or closing disclosure.
Upon payment of the amount owed under the Judgment to DLJ Mortgage
Capital, LLC, the Judgment recorded at O.R. Book 32882, Page 432;
the mortgage recorded at O.R. Book 31393, Page 248 as assigned at
O.R. Book 31431, Page 2505 in the public records of Miami-Dade
County, Florida, will be deemed satisfied in full and released.
The Notices of Lis Penden recorded at O.R. Book 32407, Page 4005
and O.R. Book 32401, Page 1 in the public records of Miami-Dade
County, Florida are deemed null and void.
All Delinquent Property Taxes due and owing to Miami-Dade County
will be paid at closing as of the closing date pursuant to
Miami-Dade County Tax Collector's payoff. All outstanding code
violations and utilities will be paid at closing as of the closing
date.
Transfer of the Real Property to SKFL is free and clear of any and
all liens and encumbrances including the following:
a. those defects created by the Michael Marcus purported
agreements recorded at O.R. Book 31026, Page 3126 and at O.R. Book
31393, Page 245 in the Public Records of Miami-Dade County,
Florida;
b. those for the MWR Commission of $12,000. For the avoidance
of any doubt, Miami Waterfront Realty, LLC and Richard Feldman will
not have any lien in or to the Real Property but Miami Waterfront
Realty, LLC is awarded a $12,000 allowed administrative claim,
which claim will be paid by the Debtor at the rate of $1,000 per
month for 12 months, with the balance being automatically due upon
the earlier to occur of: a) payment of any other allowed
administrative claim in the instant bankruptcy case; or b) upon the
effective date of any plan confirmed in the instant case unless
otherwise agreed by MWR. MWR reserves all rights to seek payment of
the outstanding administrative claims as a condition of dismissal.
The Debtor is authorized to pay the MWR Commission without any
further order of the Court. The $1,000 monthly payments will
commence, and the first monthly payment is due, on the 30th day
immediately following the closing of the sale of the Real Property
and payable on the same day every month thereafter.
c. those for any purported claims of E. Wiesel.
Notwithstanding the provisions of Bankruptcy Rule 6004(h), the
Order will be effective and enforceable immediately upon entry and
its provisions will be self-executing. The 14-day period under
Rule 6004(h) is waived.
About Good Guyz Investments
Good Guyz Investments, LLC, a company in Sunny Isles Beach, Fla.,
sought protection under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Fla. Case No. 22-10728) on Jan. 30, 2022, listing up to $1
million in assets and up to $10 million in liabilities. Bryan
Goldstein, manager, signed the petition.
Judge Laurel M. Isicoff oversees the case.
The Law Offices of Richard R. Robles, P.A. serves as the Debtor's
legal counsel.
GPMI CO: $4.3M From Sponsor to Fund Plan Payments
-------------------------------------------------
GPMI, Co., filed with the U.S. Bankruptcy Court for the District of
Arizona a Disclosure Statement for First Amended Plan of
Reorganization dated October 24, 2022.
Debtor operates as a premier supplier of consumer packaged goods
with a focus on cleaning products, primarily two types of wet wipes
delivery systems -- those sold in soft-packs and those sold in
canisters.
Debtor currently employs approximately 27 employees, and is located
at 190 South McQueen Road, Gilbert, Arizona, in leased premises
that house both its business offices and manufacturing operations.
The leased facility is approximately 84,726 square feet, and
includes executive and sales offices, warehouse space within which
is located Debtor’s inventory, work in process, raw materials,
specialized operating and manufacturing equipment and improvements.
The COVID pandemic had a major impact on GPMI's business. The
increased demand in the marketplace led to shortages of product
necessary to fulfil the huge demand. By January 2022, that
situation started to resolve itself through market forces and
demand for GPMI's made-in-the-USA, high-quality products has been
increasing, but not quickly enough for GPMI to survive as a going
concern without reorganizing pursuant to the Plan.
In the time that has passed since the Filing Date, the Debtor has
continued to struggle to reach a break even, and Debtor was further
challenged to do so in the context of an ongoing chapter 11
reorganization due to reluctance amongst its customer base to enter
into new or renewed supply agreements. If Debtor's business is to
survive going forward for the benefit if its employees, suppliers
and other parties in interest, it must reorganize and emerge from
chapter 11 bankruptcy quickly.
The Plan is premised on the reorganization of Debtor to be funded
by Plan Sponsor with the Sponsor Plan Payment in the amount of
$4,300,000.00. The Plan contemplates a division of Debtor's assets
into two separate entities on the Effective Date. The first entity
will be the Reorganized Debtor, which will continue Debtor's
business operations as a going concern engaged in the manufacturing
of packaged wet wipes for the cleaning and automotive industries,
among others.
All assets of Debtor other than the Litigation Trust Assets will
vest in the Reorganized Debtor as of the Effective Date of the Plan
free and clear of all Claims and Administrative Expense Claims. The
Reorganized Debtor be wholly owned by Plan Sponsor on and after the
Effective Date, and will be liable only for Claims arising after
the Effective Date, and certain cure claims related to Assumed
Contracts and Working Capital Accounts Payable.
The second entity will be the newly formed Litigation Trust, in
which the Litigation Trust Assets, i.e. Debtor's Causes of Action,
will vest free and clear on the Effective Date of the Plan. The
Litigation Trust will assume all of Debtor's liability to creditors
holding Allowed Claims and Allowed Administrative Expense Claims
not otherwise satisfied by the Plan or assumed by the Reorganized
Debtor and to the holders of Debtor's Shareholder Interests. The
Litigation Trust will be initially funded on the Effective Date of
the Plan from the Sponsor Plan Funding in the amount of at least
$500,000. In summary, the Sponsor Plan Funding will be used in
connection with the release of the NFS Equipment, payments of
certain post-petition Administrative Expense Claims arrears to
Debtor's Landlord and estate professionals, and to retire all of
the DIP Loans.
Class 8 is comprised of any Allowed General Unsecured Claims not
otherwise treated under this Plan. The Debtor estimates that
Allowed Class 8 Claims will total approximately $11,500,000.
Allowed Class 8 Claims shall receive, in full satisfaction,
settlement, release, extinguishment and discharge, distributions on
a pro rata basis up to the full amount of the Allowed Class 8 Claim
from the Litigation Trust, the timing of which shall be subject to
discretion of the Litigation Trustee and the terms of the
Litigation Trust Agreement. Class 8 Claims are impaired.
Class 9 is comprised of the existing Shareholder Interests in
Debtor. All existing Shareholder Interests of the Debtor shall be
cancelled, released, and extinguished on the Effective Date, and
the Reorganized Debtor shall not have any continuing obligations
with respect to such Shareholder Interests. All of the New Equity
in the Reorganized Debtor shall be issued to the Plan Sponsor on
the Effective Date. The Shareholder Interests shall receive, in
full satisfaction, settlement, release, extinguishment and
discharge, distributions from the Litigation Trust paid on a pro
rata basis if there are any amounts remaining from the Litigation
Trust or after payment of all Allowed Claims in full, the timing of
which distribution shall be subject to the discretion of the
Litigation Trustee and the terms of the Litigation Trust
Agreement.
On the Effective Date and subject to the conditions set forth in
this Plan, Plan Sponsor shall pay and distribute the Sponsor Plan
Funding as set forth on the Disclosure Statement and to the
Confirmation Order.
A full-text copy of the Disclosure Statement dated October 24,
2022, is available at https://bit.ly/3U1JHlE from PacerMonitor.com
at no charge.
Attorneys for the Debtor:
Steven N. Berger, Esq.
Patrick A. Clisham, Esq.
Michael P. Rolland, Esq.
Engelman Berger, PC
2800 North Central Avenue, Suite 1200
Phoenix, AZ 85004
Telephone: (602) 271-9090
Facsimile: (602) 222-4999
Email: snb@eblawyers.com
pac@eblawyers.com
mpr@eblawyers.com
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.
HERBALIFE NUTRITION: Egan-Jones Keeps BB- Senior Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company, on September 16, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Herbalife Nutrition Ltd.
Headquartered in Los Angeles, California, Herbalife Nutrition Ltd.
operates as a nutrition company.
HILTON WORLDWIDE: Egan-Jones Retains B+ Senior Unsecured Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on September 20, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Hilton Worldwide Holdings Inc.
Headquartered in McLean, Virginia, Hilton Worldwide Holdings Inc.
operates as a holding company.
HOBBS INVESTMENT: Dec. 6 Hearing on Disclosure Statement
--------------------------------------------------------
Judge Brenda K. Martin has entered an order that the Court will
consider the approval of Hobbs Investment Properties, LLC's
Disclosure Statement at a hearing on Dec. 6, 2022, at 1:30 p.m.
The Disclosure Statement Hearing will be held telephonically.
Interested parties must call 877-336-1829, access code 5564497 to
make their appearance.
Any party desiring to object to the Court's approval of the
Disclosure Statement must file a written object on by Nov. 29,
2022.
The Court has set Dec. 5, 2022, as the deadline for
non-governmental creditors to file proof of claims. The deadline
for governmental units to file proof of claims, other than for
claims resulting from a tax return filed under 11 U.S.C. section
1308, is the later of the bar date or 180 days after the order for
relief. The deadline for governmental units to file proof of
claims resulting from a tax return filed under 11 U.S.C. section
1308, is the later of the bar date, 180 days after the order for
relief or 60 days after the filing of the tax return.
About Hobbs Investment Properties
Hobbs Investment Properties, LLC, is a single asset real estate
debtor (as defined in 11 U.S.C. Section 101(51B)). It owns real
property located at 3846 E. Illini St., Phoenix, Ariz., valued at
$2.4 million.
Hobbs Investment Properties filed its voluntary petition for
Chapter 11 protection (Bankr. D. Ariz. Case No. 22-02292) on April
14, 2022, listing $2,520,475 in assets and $553,846 in liabilities.
Lorin Hobbs, managing member, signed the petition.
Judge Brenda K. Martin oversees the case.
Allen Barnes & Jones, PLC, serves as the Debtor's legal counsel.
HOUSE TO HOME: US Bank to Be Paid in Full in 10 Years in Plan
-------------------------------------------------------------
House to Home Strategies LLC submitted an Original Disclosure
Statement pursuant to Section 1125 of the Bankruptcy Code
describing Reorganization Chapter 11 Amended Plan dated Oct. 19,
2022.
This is a Reorganization Plan. In other words, the Proponent seeks
to accomplish payments under the Plan by future income and
operation of the LLC.
Under the Plan, Class 1 Secured Claim of US Bank Trust National
Association totaling $945,957. The payment will be made on the
first day of the first month following the effective date of the
Plan, will begin on the month following the Effective Date of the
Plan, and will end after 10 years.
Certain priority claims that are referred to in Code Sections
507(a)(3), (4), (5), (6), and (7) are required to be placed in
classes. But the disclosure statement indicates that there are no
priority unsecured claims, as well as any general unsecured
claims.
Trevor Krill is the managing member of the Debtor, as such the
class is not impaired and is deemed to have accepted the Amended
Plan.
The Amended Plan will be funded by Debtor's principal and
principal's wife's personal assets and income as necessary. The
Debtor is also attempting to secure additional financing using
Debtor's principal and principal's wife's income and assets.
A copy of the Disclosure Statement dated Oct. 19, 2022, is
available at https://bit.ly/3eMYbqL from PacerMonitor.com.
About House to Home Strategies
Led by principal Trevor Krill, Home to House Strategies LLC has
been in this business since May 4, 2015. In April 2017, the
company purchased the 8.3-acre property located at 3460 Ridge Pike,
Collegeville PA 19426 in Montgomery County as an investment which
included a single-family home.
After rebuilding the existing single-family home in the property,
the house was placed on the market but did not sell. To control
its expenses and keep the property, the Debtor's principal Trevor
Krill and his family moved into the property and continued to pay
for Debtor's expenses (including mortgage payments, real estate
taxes, utilities, property maintenance and insurance).
Due to the Covid-19 crisis and various medical issues involving
Debtor's principal, Trevor Krill's daughter, the Debtor was not
able to make the required monthly mortgage payments.
Home to House Strategies LLC, a small business, filed a Chapter 11
bankruptcy petition (Bankr. E.D. Pa. Case No. 22-11690) on June 28,
2022, just a day before a Sheriff Sale was scheduled to occur.
The company listed assets of $500,001 to $1 million and debt of
$100,001 to $500,000.
The case is pending before Judge Eric L Frank.
Gary Schafkopf of Schafkopf Law is the Debtor's counsel.
IGLESIAS DIOS: Plan Filing Deadline Extented to Nov. 18
-------------------------------------------------------
Judge Edward A. Godoy has entered an order granting Iglesias Dios
Es Amor Inc. an extension of 30 days to file a Disclosure Statement
and Plan of through and including Nov. 18, 2022. This is the
fourth extension granted to the Debtor.
About Iglesias Dios Es Amor
Iglesias Dios Es Amor, Inc., filed its voluntary petition for
relief under Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.P.R.
Case No. 21-03508) on Nov. 29, 2021, listing as much as $1 million
in both assets and liabilities. Elias Reyes Ortiz, president,
signed the petition.
Judge Edward A. Godoy oversees the case.
The Debtor tapped Gerardo L. Santiago Puig, Esq., at Santiago Puig
Law Offices as legal counsel and Juan C. Pomales Torres as
accountant.
ILLINOIS VALLEY: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: Illinois Valley Cellular RSA 2-I, LLC
200 Riverfront Drive
Marseilles, IL 61341-1454
Business Description: Illinois Valley Cellular RSA 2-I, LLC is a
locally owned and operated wireless service
provider.
Chapter 11 Petition Date: October 28, 2022
Court: United States Bankruptcy Court
Northern District of Illinois
Case No.: 22-12537
Judge: Hon. Timothy A. Barnes
Debtor's Counsel: Shelly A. DeRousse, Esq.
FREEBORN & PETERS LLP
311 South Wacker Drive, Suite 3000
Chicago, IL 60606
Tel: 312-360-6000
Fax: 312-360-6520
Email: sderousse@freeborn.com
Estimated Assets: $500,000 to $1 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Jonathan D. Foxman, president of IVC
Acquistion, LLC.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/QXQM2IY/Illinois_Valley_Cellular_RSA_2-I__ilnbke-22-12537__0001.0.pdf?mcid=tGE4TAMA
IMAX CORP: Egan-Jones Keeps BB- Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company, on September 16, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by IMAX Corporation.
Headquartered in Mississauga, Canada, IMAX Corporation offers
end-to-end cinematic solution combining proprietary software,
theater architecture, and equipment.
INDEPENDENCE FUEL: Taps Valdez Washington as Special Counsel
------------------------------------------------------------
Independence Fuel Systems, LLC seeks approval from the U.S.
Bankruptcy Court for the Eastern District of Texas to hire Valdez
Washington, LLP as its special counsel.
The firm will perform services related to litigation in the
adversary proceeding currently before this court, and other
litigation matters concerning collection as they may arise.
The firm will receive a flat fee of $7,000 per month for its
services.
As disclosed in court filings, Valdez Washington neither holds nor
represents any interest adverse to the Debtor or the estate.
The firm can be reached through:
R. Jeronimo Valdez, Esq.
Valdez Washington LLP
Highland Park Place
4514 Cole Avenue, Suite 600
Dallas, TX 75205
Tel: (214) 361-7800
Fax: (469) 327-2629
Email: jvaldez@vwlegal.com
About Independence Fuel Systems
Independence Fuel Systems, LLC, owner of gasoline stations in
Texas, sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. E.D. Texas Case No. 22-60301) on July 14, 2022, with
up to $50,000 in assets and up to $10 million in liabilities.
Charles Neuberger, chairman of the Board of Managers, signed the
petition.
Judge Joshua P. Searcy oversees the case.
Eric A. Liepins, P.C. is the Debtor's bankruptcy counsel. The Law
Office of PJ Putman, P.C. and Valdez Washington, LLP serve as the
Debtor's special counsel.
INNOVATE CORP: Moody's Lowers CFR to Caa1, Outlook Stable
---------------------------------------------------------
Moody's Investors Service downgraded INNOVATE Corp.'s corporate
family rating to Caa1 from B3, its probability of default rating to
Caa1-PD from B3-PD, its senior secured notes rating to Caa2 from
Caa1, and its Speculative Grade Liquidity ("SGL") Rating to SGL-4
from SGL-3. The rating outlook remains stable.
"The downgrade reflects weakness in INNOVATE's credit metrics - at
the holding company level as well as on a consolidated basis –
which Moody's expect will continue for the next 12-18 months,
combined with tight liquidity" said Sandeep Sama, Moody's Vice
President – Senior Analyst and lead analyst for INNOVATE.
Governance considerations under Moody's ESG framework - including
financial strategy & risk management, and management track record -
were key drivers of the rating action. Moody's has revised
INNOVATE's Governance Issuer Profile Score (IPS) to G-5 from G-4,
and its Credit Impact Score (CIS) to CIS-5 from CIS-4.
Downgrades:
Issuer: INNOVATE Corp.
Corporate Family Rating, Downgraded to Caa1 from B3
Probability of Default Rating, Downgraded to Caa1-PD from B3-PD
Speculative Grade Liquidity Rating, Downgraded to SGL-4 from
SGL-3
Senior Secured Regular Bond/Debenture, Downgraded to Caa2 (LGD4)
from Caa1 (LGD4)
Outlook Actions:
Issuer: INNOVATE Corp.
Outlook, Remains Stable
RATINGS RATIONALE
INNOVATE's Caa1 CFR reflects its holding company status, with a
high degree of reliance on dividends, and tax sharing payments from
its operating subsidiaries. While INNOVATE has three main operating
subsidiaries across diverse businesses and end markets, it largely
depends on its infrastructure subsidiary – DBM Global – for
dividend and tax sharing payments, which it uses to service its
holding company cash needs. The limited scale and lack of
profitability of its other operating subsidiaries – Life Sciences
and Spectrum – and the company's acquisitive history along with
the risk of additional debt funded acquisitions are also factored
into the rating. Historically, the payments from its various
subsidiaries have not been sufficient to cover INNOVATE's holding
company cash needs (debt service, preferred dividends, corporate
overhead etc.), with the company relying on asset sales and
external financing to bridge the gap. However, INNOVATE's rating is
supported by the collateral value of the assets and the diversity
and monetization potential of its subsidiaries.
Moody's expect underlying performance of INNOVATE's infrastructure
subsidiary – DBM Global – to improve over the next 12-18 months
driven by an order backlog that has remained stable over the last
few quarters, with embedded margins that are higher than in recent
periods. This, combined with improved working capital, should
result in better EBITDA and free cash flow at the subsidiary in
2023. However, amount that can be paid in the form of dividends to
INNOVATE remains constrained, and tied to financial performance
over the prior two-year period. Separately, Moody's do not expect
INNOVATE's other subsidiaries to make any dividend payments in the
near-term, even though some of them provide upside optionality in
the future. As a result, Moody's expect overall dividend and tax
sharing payments from its subsidiaries to fall short of its annual
cash needs – which are typically around $50 million –
consistent with recent years.
INNOVATE expects to receive nearly $32 million from the sale of the
remaining 19% stake in HMN International Co. Ltd., following on
from the first leg of the transaction which closed in 2020.
However, the transaction has been experiencing delays. INNOVATE has
no near-term debt maturities at the holding company level, although
its Spectrum subsidiary has nearly $52 million of debt maturing on
November 30, 2022.
INNOVATE's rating receives support from the collateral value of the
assets of its operating subsidiaries in relation to its holding
company and subsidiary debt. The collateral coverage ratio of these
assets was greater than 1.5x as of June 30, 2022 according to
independent appraisals.
INNOVATE's SGL-4 rating reflects its weak liquidity. As of June 30
2022, INNOVATE had only $3.6 million of cash at the corporate
level, with $15 million available under the corporate revolver.
Subsequent to quarter-end however, INNOVATE drew down the remaining
balance on the corporate revolver to meet its interest payment and
other obligations, due to a delay in the expected dividend payment
from DBM resulting from increased working capital requirements at
the subsidiary. While the $32 million of expected asset sale
proceeds can somewhat ease the liquidity tightness, uncertainty
around the timing of those proceeds, as well as continued shortfall
of subsidiary dividend and other payments relative to holding
company cash needs are reflected in Moody's SGL-4 rating.
The stable outlook reflects (1) Moody's expectation for improved
operating performance at the infrastructure subsidiary; (2) Moody's
expectation that the company will be able to roll forward the debt
at its Spectrum operating subsidiary, which currently matures on
November 30, 2022.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade of the company's ratings could be considered if it
lowers its leverage ratio below 6.5x (Debt/Dividends), strengthens
its liquidity profile and consistently receives dividends from its
operating subsidiaries that cover its holding company cash
obligations.
A downgrade could occur if INNOVATE's leverage ratio
(Debt/Dividends) is sustained above 10.0x or if it makes additional
debt financed acquisitions of companies with limited cash
generating capabilities. Further reduction in liquidity could also
result in a downgrade. Additionally, the inability of INNOVATE's
Spectrum operating subsidiary to roll forward its upcoming debt
maturity could also result in a downgrade.
Headquartered in New York, New York, INNOVATE Corp. is a holding
company whose principal focus is on acquiring or entering into
combinations with businesses in diverse segments. The company's
principal holdings include controlling interests in DBM Global
Inc., a North American engineering, modeling, steel fabrication and
erection company and through its GrayWolf subsidiary provides
maintenance, repair, installation, outage and turnaround services.
In addition to DBM Global (Infrastructure), the company owns or has
investments in other businesses, including in life sciences
(Pansend, R2, MediBeacon) and over-the-air broadcast television
(Spectrum). INNOVATE generated $1.6 billion in revenues during the
trailing 12 months ended June 30, 2022.
The principal methodology used in these ratings was Construction
published in September 2021.
INTEGRITY CONSTRUCTION: Unsecureds to Get 28.58 Cents on Dollar
---------------------------------------------------------------
Integrity Construction Solutions, LLC, submitted a Fourth Amended
Plan of Reorganization dated October 21, 2022.
The Debtor's financial projections show that the Debtor will have
projected disposable income (as defined by s 1191(d) of the
Bankruptcy Code) for the period described in s 1191(c)(2) of
$907,522.65 from operations. The final Plan payment is expected to
be paid on or about January 15, 2028.
This Plan of Reorganization under chapter 11 of the Bankruptcy Code
proposes to pay creditors of Integrity Construction Solutions, LLC
from cash flow from operations and future income.
Non-priority unsecured creditors holding allowed claims will
receive estimated distributions, which the proponent of this Plan
has valued at approximately 28.58 cents on the dollar.
Under the Plan, Class 1 All Non-Priority Unsecured Claims allowed
under Sec. 502 of the Code, not otherwise separately classified
herein. Creditors having allowed general, nonpriority unsecured
claims will receive a pro rata distribution of a minimum of
$667,202.43, in 60 installments (5 years). Payments will commence
on January 15, 2023 and continue on the 15th day of each month
thereafter for 60 months. Class 1 claims shall not bear interest.
The final payment is anticipated to be mailed on January 15, 2028.
Class 1 is impaired.
Class 2 Non-Priority Unsecured Claim of Newport Hills Association
of Apartment Owners is unimpaired. Newport Hills accepted the
Debtor's Work Proposal to replace the roofs for 4 of its buildings,
on or about July 12, 2021. As a down payment on this work, Newport
Hills paid the Debtor $150,617. However, an AIA contract was not
entered into prior to the filing of the bankruptcy. No work had
begun prior to the filing. The Debtor and Newport Hills intend to
finalize this relationship by entering into a new postpetition
contract. This new contract will also include an additional 6
building roofs, for a total of 10. The Debtor anticipates that
this will generate a net profit to the Debtor of $54,499.57 by the
end of 2022. (Amount subject to adjustment based upon inflation
for material costs and timing delays based on supply chain issues
that have plagued the construction industry in the last several
months.) The Debtor will honor the original deposit of $150,616.80
towards the future work under the to-be-finalized AIA contract.
There is to be no monthly payment from the Debtor to Newport Hills
and no further distribution under this Plan of Reorganization to
them, apart from carrying over this deposit to the new contract.
Class 3 Non-Priority Unsecured Claims of Insiders of the Debtor
areimpaired, but ineligible to vote. Class 3 consists of all
claims that any of the members and former members may have against
the Debtor. The following insiders may have claims against the
Debtor:
* Joe Cantwell – $0.00 (Former Member of the Debtor, exited
6/8/21)
* Corey Recla – $219,000.00 (Former Member of the Debtor,
exited 1/31/22)
* Richard Creamer – $72,402.98 (Current Managing Member)
* Jeremy Schlosser – $47,000.00 (Current Managing Member)
These claims have arisen since November 2020 and are not reflected
by formal loan documents. The insiders will receive no payments
under this Class until all creditors with allowed claims in Class 1
have been paid in full their total allowed claims (not just their
dividend) and all of the distributions to Class 1 have been
completed. If Class 1 has received their full allowed claim amount
prior to the expiration of the five-year repayment period of this
Plan, the Debtor may make distributions to Class 3 creditors up to
the amounts listed above, pro rata, if prudent in its business
judgment. Following expiration of the five-year repayment period
and if Class 1 has not been paid in full, claims against the Debtor
by these parties will be wholly extinguished and the Debtor will be
released of any obligation to repay the above pre-petition claims
pursuant to the discharge provisions of Article 9. These claims
shall not bear interest.
The distributions from operations described herein will be funded
through the Debtor's continuing operations as a general contractor
within Western Washington. The company's focus pre-petition was on
larger scale projects for apartments, condominiums, townhomes,
commercial and mixed-use buildings, and luxury residential
communities. Post-petition, the Debtor has expanded its business
model to include residential remodeling of single-family homes and
smaller communities. The Debtor will continue to provide services
as a general contractor and subcontractor to address inspections,
provide consulting services, and renovations (interior and
exterior, large and small projects). To a lesser extent,
distributions from operations may also be funded through sales of
assets as necessary.
Attorney for the Plan Proponent:
Kathryn P. Scordato, Esq.
2033 6th Ave., Suite 251
Seattle, WA 98121
Tel: 206-223-9595
Fax: 206-386-5355
E-mail: kpscordato@gmail.com
About Integrity Construction Solutions
Integrity Construction Solutions, LLC, filed a petition under
Chapter 11, Subchapter V of the Bankruptcy Code (Bankr. W.D. Wash.
Case No. 22-10353) on March 7, 2022, listing up to $500,000 in
assets and up to $10 million in liabilities. Virginia Burdette
serves as Subchapter V trustee.
Judge Christopher M. Alston oversees the case.
Vortman & Feinstein is the Debtor's legal counsel.
INTERDIGITAL INC: Egan-Jones Keeps BB+ Senior Unsecured Ratings
---------------------------------------------------------------
Egan-Jones Ratings Company, on September 13, 2022, retained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by InterDigital, Inc.
Headquartered in Wilmington, Delaware, InterDigital, Inc. designs
and develops technology for advanced digital wireless
telecommunications applications.
IONIS PHARMACEUTICAL: Egan-Jones Retains B+ Sr. Unsecured Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company, on September 20, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Ionis Pharmaceuticals, Inc.
Headquartered in Carlsbad, California, Ionis Pharmaceuticals, Inc.
operates as a biotechnology company.
IRON MOUNTAIN: Egan-Jones Retains BB Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on September 20, 2022, retained its
'BB' foreign currency and local currency senior unsecured ratings
on debt issued by Iron Mountain Incorporated.
Headquartered in Boston, Massachusetts, Iron Mountain Incorporated
is a storage and information management company.
JBL RESTAURANT: $668K Sale of Riverbend Property to Thompsons OK'd
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Judge Brenda Moody Whinery of the U.S. Bankruptcy Court for the
District of Arizona authorized JBL Restaurant Investments, Inc.'s
sale of the real property located at 3222 N. Riverbend Place,
situated in Pima County, State of Arizona, and legally described
as: Lot 31 of Riverbend Ranch Estates according to the Map recorded
in Book 23 of Maps and Plats at Page 48 of the records of Pima
County, Arizona to Craig Thompson and Ana Thompson for $668,000.
The sale is free and clear of liens, with liens to attach to the
sale proceeds.
The Debtors are authorized and directed to close the sale upon the
terms and conditions approved above, and set forth in the Sale
Agreement.
The Debtors and the Buyers under the Sale Agreement, and Stewart
Title, as the escrow agent, are authorized and directed to pay,
from the proceeds of the sale, without further order of the Court,
the following amounts: Escrow Fees to Stewart Title; Recording Fees
and any other fees necessary to complete the closing of escrow; AZ
Flat Fee its $3,800 commission from the sale proceeds; premium of a
standard coverage ALTA Owner's Title Policy; the Debtors' share of
prorated property taxes owed for the Property; JP Morgan Chase
funds sufficient to cause it to release its Deed of Trust on the
Property; and the US Bank funds sufficient to cause it to release
its Deed of Trust on the Property.
All remaining proceeds from the sale will be deemed homestead
proceeds, and will be held by Stewart Title pending further order
of the Court.
As provided by Rules 6004(h) and 6006(d), Fed. R. Bankr. P., the
Order will not be stayed for 14 days after the entry of this Order
and will be effective immediately upon entry, and the Debtors,
Stewart Title, and the Buyers are authorized to immediately proceed
to close the sale.
About JBL Restaurant Investments
JBL Restaurant Investments, Inc. sought protection for relief
under
Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz. Case No.
22-00886) on Feb. 11, 2022, listing up to $50,000 in assets and up
to $500,000 in liabilities. The case is jointly administered with
the Chapter 11 case filed by James Brian and Diane Latta (Bankr.
D.
Ariz. Case No. 22-02577).
Judge Brenda Moody Whinery oversees the cases.
Kasey C. Nye, Esq., at Waterfall, Economidis, Caldwell, Hanshaw &
Villamana, P.C. serves as the Debtors' legal counsel.
JEFFERIES FINANCE: Fitch Alters Outlook on 'BB+' IDR to Negative
----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings
(IDRs) of Jefferies Finance LLC (JFIN) and its debt co-issuing
subsidiary JFIN Co-Issuer Corporation (JFIN Co-Issuer) at 'BB+'.
Fitch has also affirmed JFIN's and JFIN Co-Issuer's secured debt
rating at 'BBB-' and unsecured debt rating at 'BB+'. The Rating
Outlook has been revised to Negative from Stable.
KEY RATING DRIVERS
IDRs AND SENIOR DEBT
The Rating Outlook revision reflects the increase in JFIN's
leverage during the three months ended Aug. 31, 2022 (fiscal 3Q22),
resulting from realizing a $155.8 million net loss during the
quarter, and the deterioration in asset quality given the
meaningful increase in the impaired loan ratio. JFIN had $1.8
billion of underwriting commitments at fiscal 3Q22 (net of $1.6
billion that had been syndicated to third parties), which exposes
the firm to the potential for additional losses amid challenging
market conditions. As of Aug. 31, 2022, JFIN had recorded a $100.3
million allowance related to certain unfunded underwriting
commitments, which may not be sufficient to absorb additional
losses.
JFIN's leverage, measured as total debt-to-tangible equity, was
2.8x at fiscal 3Q22. If borrowings under the corporate revolver
were excluded, leverage would have been 2.4x at fiscal 3Q22, which
is up from 1.9x at fiscal YE 2021 and above Fitch's downgrade
trigger of 2.0x. Fitch believes leverage will remain above this
level in the coming quarters as earnings will remain pressured by
lower transaction volumes.
Additionally, JFIN's earnings have been negatively affected by an
increase in loan loss provisions ($46.5 million in fiscal 9M22) and
unrealized losses on unfunded underwriting commitments ($106
million in fiscal 9M22), and Fitch believes further losses and/or
write-downs are possible given the challenging economic backdrop.
An inability to reduce leverage below 2.0x over the Rating Outlook
horizon could result in a ratings downgrade.
Asset quality on JFIN's funded portfolio has been relatively strong
over time, but deteriorated in fiscal 3Q22. Impaired loans
increased to 16% of loans receivable at fiscal 3Q22, from 0.2% at
fiscal YE 2021, driven by one large position that JFIN previously
intended to syndicate. Fitch believes there is potential for
further deterioration in asset quality metrics as rising interest
rates could pressure underlying portfolio companies since
approximately 100% of JFIN's loan portfolio bore interest at
floating rates at Aug. 31, 2022. An increase in losses or provision
expenses could put further pressure on JFIN's leverage.
The rating affirmations continue to reflect the benefits of JFIN's
relationship with Jefferies Group LLC (Jefferies; BBB/Positive),
including access to deal flow, JFIN's experienced management team,
supportive ownership from Jefferies and Massachusetts Mutual Life
Insurance Company (AA/Stable), now via JFIN Parent LLC, focus on
senior lending relationships in the remaining funded portfolio,
solid historical asset quality performance, appropriate level of
unsecured debt-to-total debt and sufficient liquidity.
Rating constraints include the recent increase in leverage,
earnings sensitivity to market conditions, potential liquidity and
leverage impacts of draws on revolver commitments and expected
fluctuations in total leverage driven by draws on the corporate
revolver and other facilities used to front underwriting
commitments. The ratings also contemplate the cyclicality of
underwriting conditions in the broadly syndicated market, which can
result in higher underlying leverage, meaningful EBITDA
adjustments, and in many cases, the absence of covenants.
The secured debt rating is one notch above the IDR, reflecting
Fitch's expectation for good recovery prospects under a stress
scenario given available asset coverage and JFIN's funding mix.
The unsecured debt rating is equalized with the IDR, reflecting
Fitch's expectation for average recovery prospects under a stress
scenario given the meaningful proportion of unsecured debt.
Subsidiaries and Affiliated Companies
The Long-Term IDR and debt ratings of JFIN Co-Issuer are equalized
with those of its parent JFIN. JFIN Co-Issuer is essentially a
shell finance subsidiary with no material operations, and is a
co-issuer on the secured corporate revolver and unsecured notes.
RATING SENSITIVITIES
IDRs AND SENIOR DEBT
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- An inability to reduce debt-to-tangible equity to 2.0x or below
over the Outlook horizon, which could result from further
deterioration in asset quality and/or operating losses due to an
inability to syndicate transactions, would likely result in a
ratings downgrade;
- Negative rating action could also be driven by a material
weakening in liquidity; reduction in funding flexibility, as
evidenced by a material decline in unsecured funding; weakening in
the firm's reputation and market position; or a change in the
firm's relationships with Jefferies and/or MassMutual.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
The Negative Outlook could be revised to Stable if JFIN is able to
reduce its leverage to 2.0x or below. A revision of the Outlook
back to Stable would also be contingent upon JFIN demonstrating
improved earnings, maintaining sufficient liquidity and not
experiencing further meaningful deterioration in asset quality
metrics;
Longer-term, upward rating momentum could be driven by increased
revenue diversity, as evidenced by growth in third-party assets
under management, which generates more stable management fees and
enhanced consistency of operating results could drive positive
rating momentum. Positive rating momentum would also be contingent
upon strong asset quality performance of the funded loan portfolio;
demonstrated management of corporate leverage at 2.0x or below;
conservative management of fronting exposures, as evidenced by
portfolio diversity and strong syndication performance through
market cycles such that total leverage was not sustained
meaningfully above the corporate leverage level; and the
maintenance of a sound liquidity profile.
The secured debt and unsecured debt ratings are sensitive to
changes in JFIN's Long-Term IDR and to the relative recovery
prospects of the instruments. The debt ratings are expected to move
in tandem with JFIN's Long-Term IDR, although the notching could
change if there is a significant shift in the funding mix.
Subsidiaries and Affiliated Companies
JFIN Co-Issuer's ratings are expected to move in tandem with JFIN's
ratings.
SG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Jefferies Finance
LLC LT IDR BB+ Affirmed BB+
senior unsecured LT BB+ Affirmed BB+
senior secured LT BBB- Affirmed BBB-
JFIN Co-Issuer
Corporation LT IDR BB+ Affirmed BB+
senior unsecured LT BB+ Affirmed BB+
senior secured LT BBB- Affirmed BBB-
JET OILFIELD SERVICES: U.S. Trustee Appoints Creditors' Committee
-----------------------------------------------------------------
The U.S. Trustee for Region 7 appointed an official committee to
represent unsecured creditors in the Chapter 11 case of Jet
Oilfield Services, LLC.
The committee members are:
1. W4 Consulting, LLC
c/o Christy Wooten
P.O. Box 31
Arcadia, LA 71001
Phone: (318) 268-9191
Email: W4consulting@outlook.com
2. IBY Outlet
Attn: Stany Gan
2469 FM 359 Rd South
Brookshire, TX 77423
Phone: (281) 433-3389
Email: Sales33@OEMic.com
3. GJR Meyer Service, Inc.
Attn: Larry Cart
6733 Leopard
Corpus Christi, TX 78409
Phone: (361) 289-2130
Email: lcart@meyernow.com
4. Blue Point Supply, LLC dba TMS
Flow Products
c/o Adam Racca
P.O. Box 1024
Youngsville, LA 70592
Phone: (318) 230-7870
Email: adam@tmsflow.com
5. Moab Energy, LLC
Attn: Todd J. Angus
2601 Estes Pkwy.
Longview, TX 75602
Phone: (903) 746-8387
Email: tj@moabenergy.com
6. B&D Flowback, LLC
Attn: David J. Eschete
3808 S. Eastman Rd.
Longview, TX 75602
Phone: (985) 438-0155
Email: davide@bndflowback.com
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About Jet Oilfield Services
Jet Oilfield Services, LLC provides support activities for mining,
and oil and gas extraction industry. The company is based in
Midland, Texas.
Jet Oilfield Services filed a petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. W.D. Texas Case No. 22-22-70126) on
Oct. 12, 2022. In the petition filed by its managing member and
owner, Charles V. Long Jr., the Debtor reported $10 million to $50
million in both assets and liabilities.
Judge Tony M. Davis oversees the case.
The Debtor is represented by Stephen W. Sather, Esq., at Barron &
Newburger, PC.
K STREET LLC: Files for Chapter 11, Bank Wants Rule 2004 Exam
-------------------------------------------------------------
K Street LLC filed for chapter 11 protection in the District of
Columbia.
According to court filings, K Street LLC, which designates itself
as a single asset real estate, estimates $1 million to $10 million
in debt to 1 to 49 creditors. The petition states that funds will
be available to unsecured creditors.
The Debtor is the current lessee of a leasehold interest in a
ground lease evidenced by that Memorandum of Ground Lease Agreement
dated June 25, 2018, recorded with the Recorder of Deeds as
Document Number 2018063534.
On June 25, 2018, pursuant to a First Deed of Trust Promissory
Note, the Debtor sought and obtained a loan from Old Line Bank in
the original principal amount of $6,300,000. Among other things,
the Loan is secured by a deed of trust recorded in the Recorder of
Deeds as Instrument No. 2018063537. WesBanco Bank is the current
holder of the Note and the Deed of Trust, as successor-in-interest
to Old Line Bank.
Immediately after the Debtor sought Chapter 11 protection, WesBanco
Bank, Inc., pursuant to Bankruptcy Rule 2004(a), filed a motion
asking the Bankruptcy Court to direct the Debtor to appear for
examination concerning the Debtor's assets and financial
condition.
According to WesBanco Bank, prior to the Petition Date, the Debtor
defaulted under the Note by, among other things, failing to pay the
regularly scheduled payments due thereunder, and by failing to
comply with the terms and covenants of the Ground Lease between the
Debtor and the Ground Lessor.
In addition, according to the Bank, the District of Columbia has
cited the Debtor with multiple violations relating to the property
where the Debtor operates as a multi-unit residential building.
Based on information provided by the Debtor in connection with the
use of cash collateral, the Debtor's occupancy rate appears to have
dropped significantly, to 61%. As a result of the Debtor's
mismanagement of the property, the Debtor is unable to pay its
operating expenses.
* * *
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Dec. 1, 2022, at 11:00 AM US Trustee Remote Location: Telephone #:
(877) 465-7076; Passcode: 7191296. Proofs of claim are due by
March 11, 2023.
About K Street LLC
K Street LLC is a Single Asset Real Estate (as defined in 11 U.S.C.
Sec. 101(51B)).
K Street LLC filed a petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. D. Col. Case No. 22-00198) on Oct. 25,
2022. In the petition filed by Habte Sequar, as president and
member, the Debtor reported assets between $10 million and $50
million and liabilities between $1 million and $10 million.
The Debtor is represented by John D. Burns of The Burns Law Firm
LLC.
KB HOME: Egan-Jones Retains BB- Senior Unsecured Ratings
--------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by KB Home.
Headquartered in Los Angeles, California, KB Home builds
single-family homes in the United States, primarily targeting
first-time and first-move-up homebuyers.
KHOFFNER USA: Unsecured Creditors Will Get 30% of Claims in Plan
----------------------------------------------------------------
Khoffner USA, Inc., filed with the U.S. Bankruptcy Court for the
Southern District of Florida a Plan of Reorganization for Small
Business dated Oct. 24, 2022.
The Debtor is a Florida corporation that has been headquartered in
the South Florida area since 2014. The Debtor was a brewery within
the Sistrunk Plaza food and entertainment complex.
The Debtor had a commercial lease with its Landlord at 116 NW 6th
Street, #C, Fort Lauderdale, Florida, 33311 that was assumed and
assigned pursuant to and in conjunction with a Motion to Approve
Sale of Assets and Assumption and Assignment of Lease. The Plan
payments will be made solely from the proceeds of the sale of
substantially all of its assets which the Debtor has entered into
with an entity named Dream State Holding Company LLC.
The Asset Purchase Agreement was filed with the Court on September
23, 2022. The Sale and Assignment closed on October 12, 2022 and
the net proceeds (after payment of the cure amount to Landlord and
escrow of $15,000 for Broward County Tax Collector) payable to the
Debtor in the amount of $292,870.73 were wired to Debtor's
counsel's Trust account subject to further Court order.
The value of the Debtor's assets at the time of the bankruptcy
petition was listed at approximately $650,000, however, the Debtor
could not continue as a going concern and the proposed Purchaser,
Dream State, provided an offer well within the range of the value
of the Debtor's assets under the circumstances of the Debtor and
the estate. Dream State was approved by the Landlord to assume the
Lease and this provided the best prospect for the highest purchase
price with less administrative costs and litigation costs than any
alternative.
As this is a liquidating Plan with the only assets being the lump
sum proceeds from the sale there is only a single plan distribution
to allowed unsecured creditors. There are currently approximately
$700,000 in scheduled unsecured creditors. The amount of unsecured
creditors may decrease after claims negotiations and/or objections
are determined. The total gross disbursement to unsecured creditors
will be approximately $200,000-$250,000 which will pay
approximately 30% of unsecured claims. Such pro rata percentage
amount could increase based on claim objections.
The Class 1 Secured Claim of the Broward County Tax Collector is
being paid directly from the proceeds of the Sale. The Broward
County Tax Collector is in the process of amending its claim and
such amended claim may be subject to objection.
The Class 3 Claim of Equity shall receive no distribution.
A full-text copy of the Plan of Reorganization dated October 24,
2022, is available at https://bit.ly/3fi16YF from PacerMonitor.com
at no charge.
Attorney for Debtor:
Thomas L. Abrams, Esq.
Gamberg & Abrams
633 S. Andrews Avenue, #500
Fort Lauderdale, FL 33301
Tel: (954) 523-0900
Fax: (954) 915-9016
Email:tabrams@tabramslaw.com
About Khoffner USA Inc.
Khoffner USA Inc., a craft brewery in Fort Lauderdale, Fla., filed
a petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. S.D. Fla. Case No. 22-15966) on Aug. 1, 2022, listing as
much as $1 million in both assets and liabilities. Linda Marie
Leali has been appointed as Subchapter V trustee.
Judge Scott M. Grossman oversees the case.
Thomas L. Abrams, Esq., at Gamberg & Abrams, is the Debtor's legal
counsel.
LAMAR ADVERTISING: Egan-Jones Retains BB- Senior Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company, on September 21, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Lamar Advertising Company.
Headquartered in Baton Rouge, Louisiana, Lamar Advertising Company
owns and operates outdoor advertising structures in the United
States.
LAREDO PETROLEUM: Egan-Jones Hikes Senior Unsecured Ratings to B+
-----------------------------------------------------------------
Egan-Jones Ratings Company, on September 19, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Laredo Petroleum, Inc. to B+ from B-.
Headquartered in Tulsa, Oklahoma, Laredo Petroleum, Inc. is an
independent oil and gas company.
LIFTING HOLDINGS: S&P Alters Outlook to Positive, Affirms 'B-' ICR
------------------------------------------------------------------
S&P Global Ratings affirmed all of its ratings on Lifting Holdings
Ltd. (Crosby), including its 'B-' issuer credit rating.
S&P said, "At the same time, we assigned a 'B-' rating to the
planned $330 million nonfungible first-lien term loan; the recovery
rating is '3', reflecting our expectation for adequate (50%-70;
rounded estimate: 65%) recovery in the event of a payment default.
"We are also assigning our 'CCC' rating to the planned $50 million
nonfungible second-lien term loan; the recovery rating is '6',
reflecting our expectation for minimal (0%-10; rounded estimate 0%)
recovery in the event of a payment default.
"The positive outlook reflects our expectation that we could raise
the ratings over the next 12 months if Crosby successfully
integrates KITO and we believe adjusted leverage will remain under
6.5x.
"Pro forma for the completion of the acquisition, we forecast
Crosby's leverage to improve to the 6x-6.5x area in 2022. This is
because Crosby plans to fund the acquisition partly with an equity
contribution from its owner, and Crosby is buying KITO at
approximately a 7x EBITDA multiple. Historically, Crosby's adjusted
leverage was elevated at 8x-9x, and it deteriorated to 9.6x during
the 2020 pandemic, but it improved to 8.0x as of June 30, 2022.
However, the combined company is expected to reduce leverage by a
7x multiple valuation for KITO and new cash equity from the
sponsor. Our leverage expectation includes contributions from KITO,
which generated ¥62.5 billion (about $525 million) in revenue and
¥9.1 billion (about $75 million) in S&P Global Ratings-adjusted
EBITDA for the company's fiscal year ended March 31, 2022. The
combined companies--along with associated synergies --are expected
to drive steady earnings. Therefore, we expect Crosby to be able to
maintain adjusted leverage at about 6.0x in 2022 and 2023. However,
integration risks, inflation, supply-chain constraints, and
recession risks could pose headwinds to our base case.
"Our leverage forecast incorporates our assumption for continued
good organic revenue growth in the next few quarters given Crosby's
adequate backlog and order book, which stem from strong demand in
end markets. We expect organic revenue to grow in the high teens
percentages in 2022, partially supported by price increases. The
company has successfully implemented price increases to combat
inflationary pressure and can adjust prices on orders placed but
not yet fulfilled. Despite broader macroeconomic uncertainty,
demand for lifting and rigging equipment is supported by the
replacement of aging manufacturing infrastructure and equipment as
well as preventative maintenance. Construction and infrastructure
end markets are positioned for durable growth based on the
significant infrastructure bill to rebuild deteriorating roads,
bridges, and other infrastructure. We believe the pro forma company
combines market leaders in their respective product specialties to
further capitalize on broader end-market growth prospects from at
least modest continued industrial and infrastructural growth.
"We expect KITO's lower-margin EBITDA profile to weigh on Crosby in
the near term. This is because of KITO's higher selling, general,
and administrative (SG&A) expenses, as a percent of revenue, than
Crosby's. In the near term, we expect the adjusted EBITDA margin of
the combined company to decline about 100 basis points (bps) due to
higher total SG&A costs. Nevertheless, KITO's gross margin has
historically been modestly higher than that of Crosby. We expect
margins to improve 12-18 months after the transaction is complete
through synergistic actions, including product insourcing, SG&A
cost savings, and back office and IT integration."
The acquisition is expected to improve Crosby's scale and
diversification. The KITO acquisition will increase Crosby's global
scale, improve its product offerings, and enable cross-selling.
Headquartered in Japan, KITO has a strong presence in Asia and
generates about 40% of revenue from the region. Combined, the
company's sales to Asia will increase to over 25% from less than
5%. The acquisition will diversify Crosby's product offering by
combining its rigging portfolio with KITO's hoist and crane
offerings. Further, the acquisition will improve end-market
diversity by reducing exposure to oil and gas and increasing
exposure to mining, wind, and general industrial. KITO also
broadens the company's exposure into the food and beverage,
utility, and pharma markets. Pro forma revenues are expected to
double to about $1 billion.
S&P said, "Under our base-case forecast, we assume Crosby generates
positive free operating cash flow (FOCF) to support its acquisition
strategy. We expect the company's FOCF in 2022 will be affected by
its working-capital investments to combat the shortage of input
materials and inflation and mitigate its supply-chain risk.
However, we anticipate Crosby's FOCF will remain good over the next
12-18 months. We believe this cash flow--in combination with about
$43 million of cash on its balance sheet as of June 30, 2022--will
likely be sufficient to fund modest bolt-on acquisitions. Although
we believe the company can fund annual bolt-on acquisitions without
the need to draw on external funds, as it has done five times since
2019, we believe its ample revolver availability will further
support its liquidity position through 2023.
"The positive outlook reflects our expectation that we could raise
the ratings over the next 12 months if Crosby successfully
integrates KITO and we believe adjusted leverage will remain under
6.5x."
S&P could raise the ratings if:
-- The company successfully integrates KITO, demand remains at
least modestly positive in Crosby's end markets, and S&P believes
the company can maintain adjusted leverage under 6.5x, even
incorporating modest operating underperformance,
higher-than-expected acquisition spending, or potential returns to
shareholders; and
-- S&P believes the company will sustain positive free operating
cash flow consistently.
S&P could revise its outlook on Crosby to stable if:
-- The company faces challenges while integrating KITO and demand
for its products weakens its operating performance materially from
its expectations, resulting in debt leverage sustained above 6.5;
or
-- S&P believes the company is unable to sustain positive FOCF.
ESG credit indicators: E-2, S-2, G-3
LIKEWIZE CORP: Moody's Cuts CFR to B2 & Alters Outlook to Negative
------------------------------------------------------------------
Moody's Investors Service downgraded Likewize Corp.'s ratings,
including the Corporate Family Rating to B2 from B1, Probability of
Default Rating to B2-PD from B1-PD and senior secured bond rating
to B3 from B2. The outlook was changed to negative from stable.
The downgrade reflects Likewize's higher financial leverage and
weaker cash flow generation than originally expected. Over the past
three years the company has been undergoing a significant business
restructuring as it continues to exit low margin and unprofitable
mobile device distribution and supply chain businesses and
increases focus on the higher margin, but highly competitive device
protection sector. Despite the margin improvement since 2019, the
continued loss of operating scale resulted in lower overall EBITDA
and higher financial leverage of around 4.6x as of June 30, 2022
(Moody's adjusted and excluding reorganization expenses, if
including these expenses leverage can be viewed as 6x). Moody's
projects leverage to remain around current levels for the next 12
to 18 months.
Downgrades:
Issuer: Likewize Corp.
Corporate Family Rating, Downgraded to B2 from B1
Probability of Default Rating, Downgraded to B2-PD from B1-PD
Senior Secured Regular Bond/Debenture, Downgraded to B3 (LGD4)
from B2 (LGD5)
Outlook Actions:
Issuer: Likewize Corp.
Outlook, Changed To Negative From Stable
RATINGS RATIONALE
Likewize's B2 CFR reflects the company's elevated leverage, high
restructuring expenses that pressure operating cash flow generation
and uncertainty around the completion of the reorganization
initiative and return to topline and earnings growth. The execution
risks remain high as EBITDA growth will be conditioned upon the
growth of the device protection and upgrade (buy-back/trade-in)
businesses, which combined represent slightly over 50% of total
revenue. Likewize's credit quality is also negatively impacted by
corporate governance concerns given the company's majority
ownership by Brightstar Capital Partners (BCP) particularly with
respect to the potential for aggressive financial strategies such
as incremental debt-financed acquisitions and shareholder
distributions that could constrain deleveraging efforts. The risks
associated with Likewize's credit profile are partially offset by
the company's solid market presence, and long-standing
relationships with large, blue chip customers.
Moody's expects Likewize will maintain good liquidity through FY
2023. The company has approximately $225 million of unrestricted
cash as of June 2022, with the balance of the cash distributed
across its global subsidiaries to support operations. Moody's
projects free cash flow generation of around $10-15 million over
the next 12-18 months. These projections assume diminishing
restructuring expenses and neutral working capital needs. The
company does not have meaningful debt maturities over the next 24
months. External sources of liquidity are primarily supported by
its $150 million ABL revolver due April 2025 along with two
receivable factoring facilities and international lines of credit.
Moody's expects ABL availability will be limited to $30-40 million
over the next 12-18 months. The lower inventory requirements of the
business will provide a borrowing base of around $80-90 million, of
which around $50 million are being used to collateralize letters of
credit. The revolving credit facility has a springing covenant
based on a minimum 1x fixed charge covenant which Moody's does not
expect to be in effect over the next 12-18 months.
The negative outlook reflects deteriorated credit metrics and the
challenges associated with the business transition to a highly
competitive device protection business. Smaller scale and high
restructuring expenses put pressure on the company's capacity to
generate stronger free cash flow.
The B3 rating for Likewize's senior secured bonds is one notch
below the CFR reflecting their position behind the ABL revolver
(unrated). The ABL revolver has a first lien on working capital
assets. The senior secured bonds come with a first lien on fixed
assets and a second lien on working capital assets. Given the
nature of the business, Moody's expects that Likewize's trade
claims will likely be at a lower level in a distress scenario and
thus they do not provide any notching support.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if Likewize demonstrates consistent
revenue growth and operating margin improvement, such that
debt/EBITDA is expected to sustain below 3.5x with free cash flow
to debt above 5%.
The ratings could be downgraded if Likewize experiences
deteriorating financial performance resulting in sustained weak
free cash flow generation. Additionally, the ratings could be
downgraded if debt financed acquisitions or shareholder initiatives
increase debt/EBITDA above 5.5x on a more than temporary basis.
Likewize Corp.'s (fka Brightstar Corp following a rebranding to
Likewize in August 2021) provides end-to-end device life-cycle
management solutions for the mobile device industry. Services
include device protection, supply chain services, buy-back and
trade-in, accessories, finance solutions, reverse logistics, and
repair solutions. In the LTM ended June 30, 2022 Likewize reported
revenue of approximately $3.15 billion.
The principal methodology used in these ratings was Distribution &
Supply Chain Services Industry published in June 2018.
LUCKY STAR-DEER: Amends Flushing Landmark Unsecured Claims
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41-60 Main Street LLC, a secured creditor of debtors Lucky
Star-Deer Park LLC and Flushing Landmark Realty LLC, submitted a
First Amended Disclosure Statement describing First Amended Plan of
Liquidation dated October 24, 2022.
The Plan provides for the sale of the assets of the Debtors. While
these two Debtors' bankruptcy cases were jointly administered with
two other debtors and debtors-in possession (i.e., In re Victoria
Towers Development Corp. (Case No. 20-73303) and In re Queen
Elizabeth Realty Corp. (Case No. 20 73327)), those other two
debtors and their assets are not directly impacted by nor
administered pursuant to the Plan.
Regardless of whether the Plan is confirmed and becomes effective:
(a) the Victoria Towers Development Corp. case and its assets will
need to be dealt with by a separate chapter 11 plan or some other
procedure or order of the Bankruptcy Court; and (b) the Queen
Elizbeth Realty Corp. case and assets will be dealt with in the
Queen Elizabeth Realty Corp. chapter 7 proceeding.
The real property owned by Lucky Star is commonly known as and
located at 377 Carlls Path, Deer Park, New York (the "Lucky Star
Property"). The real property owned by Flushing Landmark is
commonly known as and located at 41-60 Main Street, Flushing, New
York (the "Flushing Landmark Property" and, together with the Lucky
Star Property, the "Properties").
The Plan, however, does provide for the allowance of the 41-60 Main
Street Claim (i.e., the Proponent's Claim) in the amount of
$143,988,021.20, plus interest from the Petition Date at the
default rate specified in the notes underlying the Proponent's
Claim, protective advances, applicable fees, and costs, though the
amount of such claim that is a 41-60 Secured Claim will depend on
the results of the Sale.
The Bid Procedures make clear that the Proponent can credit bid up
to the full amount of the 41-60 Main Street Claim, regardless of
the amount that is secured. The 41-60 Main Street Claim is
estimated to be $181,600,926.76 as of December 31, 2022, which
includes an estimate of $150,000 for legal fees from September 1,
2022 through December 31, 2022.
The Plan provides for the liquidation of the Debtors by selling the
Debtors' only material assets, the Properties, to generate proceeds
to pay Allowed Claims of the Debtors' estate. In general, the
proceeds of the Sale of the Lucky Star Property will be distributed
to creditors of Lucky Star and the proceeds of the Sale of the
Flushing Landmark Property will be distributed to creditors of
Flushing Landmark.
The Proponent intends to sell the Properties to obtain their
highest and best price, in accordance with applicable provisions of
the Bankruptcy Code. The closing of the Sale of each Property shall
take place following the Auction for each Property in accordance
with the Bid Procedures. In summary, the Broker will market the
Properties and conduct an Auction following confirmation in the
following order: first, the Lucky Star Property; second, the
Flushing Landmark Property, though the Properties may be auctioned
on different dates. The Proponent will be entitled, within its
discretion, to submit a credit bid in the Allowed amount of the
41-60 Main Street Claim (including post- petition protective
advances, interest, fees, costs and expenses subject to a credit at
the Flushing Landmark Property Sale in the amount of net proceeds
calculated based on the winning bid at the Lucky Star Property
Sale.
If there are no bids for the Lucky Star Property other than 41-60
Main Street's credit bid, the amount of the credit shall be deemed
to be $30,000,000. The Closing for each of the Properties shall
take place after the Auction and the entry of an order approving
each of the Sales to the Successful Bidder(s). All proceeds of the
Sale (after payment of applicable expenses (including property
taxes owed on each of the Properties) and any distribution owed to
the 41-60 Main Street Secured Claim (Class 2)) shall be deposited
with the Distribution Agent and become Available Cash for each
applicable Debtor.
Class 9 consists of Flushing Landmark General Unsecured Claims.
Each holder of an Allowed Class 9 Flushing Landmark General
Unsecured Claim will receive on account of such claim a pro rata
distribution of Flushing Landmark Available Cash after all payments
to the Class 2 Claim, Class 7 Claims, and Class 8 Claim, and
Statutory Fees and Administrative Claims against Flushing Landmark,
with interest from the Petition Date onwards at the rates set forth
in the applicable Note(s) as to the Claim in Class 2, and interest
from the Petition Date onwards at the Federal Judgment Rate as to
all other Claims and Fees, with interest as to all such Classes
being paid in full prior to any payments being made on account of
principal; provided, however, that the Proponent will guaranty a
distribution of $32,252.41 to holders of Claims in Class 9 other
than the 41-60 Main Street Unsecured Claim, the Proponent agreeing
to waive the right to receive any distribution from such $32,252.41
as a member of this Class.
The Plan will be funded by monies made available from the Sale of
the Properties (and the Property Causes of Action); however, the
Proponent shall advance such funds as are necessary to make
payments required under the Plan if the Sale proceeds are
insufficient to fund all payments required under the Plan.
The Bankruptcy Court has scheduled a hearing to consider
confirmation of the Plan, on December 5, 2022 at 10:00 a.m.
The Bankruptcy Court has directed that objections, if any, to the
Confirmation of the Plan be filed and served on or before Nov. 28,
2022 at 5:00 p.m. All ballots for the acceptance or rejection of
the Plan must be received prior to Nov. 28, 2022.
A full-text copy of the First Amended Disclosure Statement dated
October 24, 2022, is available at https://bit.ly/3WbCwt6 from
PacerMonitor.com at no charge.
Attorneys for 41-60 Main Street:
KRISS & FEUERSTEIN LLP
360 Lexington Avenue, Suite 1200
New York, NY 10017
(211)661-2900
Jerold C. Feuerstein, Esq.
Daniel N. Zinman, Esq.
About Lucky Star-Deer Park
Lucky Star-Deer Park, LLC, is a single asset real estate as defined
in 11 U.S.C. Section 101(51B). The company is based in Flushing,
N.Y.
Lucky Star-Deer Park and affiliates, Flushing Landmark Realty LLC
and Victoria Towers Development Corp., sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case Nos.
20-73301, 20-73302 and 20-73303) on Oct. 30, 2020. On Nov. 3,
2020, another affiliate, Queen Elizabeth Realty Corp., filed a
Chapter 11 petition (Bankr. E.D.N.Y. Case No. 20-73327). Judge
Robert E. Grossman oversees the cases, which are jointly
administered under Case No. 20-73301.
At the time of the filing, Lucky Star-Deer Park listed up to
$50,000 in assets and up to $500,000 in liabilities.
The Debtors tapped Rosen & Kantrow, PLLC, as bankruptcy counsel;
Certilman Balin and The Law Offices of Fred L. Seeman as special
counsels; Joseph A. Broderick, P.C. as accountant; and Miu & Co. as
audit consultant.
LUNA ROSA: Case Summary & Seven Unsecured Creditors
---------------------------------------------------
Debtor: Luna Rosa Gelato Cafe, LLC
123 South Main Street
Greenville, SC 29601
Business Description: The Debtor is a restaurant offering Southern
Italian fare & many flavors of gelato.
Chapter 11 Petition Date: October 27, 2022
Court: United States Bankruptcy Court
District of South Carolina
Case No.: 22-02923
Judge: Hon. Helen E. Burris
Debtor's Counsel: Robert Pohl, Esq.
POHL, P.A.
P.O. Box 27290
Greenville, SC 29616
Tel: 864-233-6294
Fax: 864-558-5291
Email: Robert@POHLPA.com
Estimated Assets: $0 to $50,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Richard Schweitzer as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's seven unsecured creditors is available for
free at PacerMonitor.com at:
https://www.pacermonitor.com/view/NRCREGA/Luna_Rosa_Gelato_Cafe_LLC__scbke-22-02923__0001.0.pdf?mcid=tGE4TAMA
MANITOWOC CO: Egan-Jones Keeps BB- Senior Unsecured Ratings
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Egan-Jones Ratings Company, on September 13, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Manitowoc Company, Inc.
Headquartered in Milwaukee, Wisconsin, Manitowoc Company, Inc. is a
diversified industrial manufacturer of cranes and related
products.
MERCER INTERNATIONAL: Egan-Jones Hikes Sr. Unsecured Ratings to BB
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Egan-Jones Ratings Company, on September 15, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Mercer International, Inc. to BB from BB-.
Headquartered in Vancouver, Canada, Mercer International, Inc. owns
and operates three modern pulp mills.
NATHANS'S FAMOUS: Egan-Jones Hikes Senior Unsecured Ratings to B+
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Egan-Jones Ratings Company, on September 21, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Nathan's Famous, Inc. to B+ from B.
Headquartered in Jericho, New York, Nathan's Famous, Inc. operates,
franchises, and licenses Nathan's Famous, Miami Subs, Kenny Rogers
Roasters, and Arthur Treachers Fish & Chips fast-food restaurants.
NATIVE ENGINEERS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Native Engineers, LLC
1042 Whitetail Drive
Mandeville, LA 70448-1996
Business Description: The Debtor provides engineering,
construction management, and program
management services.
Chapter 11 Petition Date: October 28, 2022
Court: United States Bankruptcy Court
Eastern District of Louisiana
Case No.: 22-11316
Judge: Hon. Meredith S. Grabill
Debtor's Counsel: Ryan J. Richmond, Esq.
STERNBERG, NACCARI & WHITE, LLC
251 Florida Street
Suite 203
Baton Rouge, LA 70801-1703
Tel: (225) 412-3667
Email: ryan@snw.law
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Sean P. Warren as manager.
A copy of the Debtor's list of 20 largest unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/M6A6LFY/Native_Engineers_LLC__laebke-22-11316__0005.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/MN2GV6Y/Native_Engineers_LLC__laebke-22-11316__0001.0.pdf?mcid=tGE4TAMA
NEKTAR THERAPEUTICS: Egan-Jones Retains CCC- Sr. Unsecured Ratings
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Egan-Jones Ratings Company, on September 23, 2022, retained its
'CCC-' foreign currency and local currency senior unsecured ratings
on debt issued by Nektar Therapeutics. EJR also retained its 'C'
rating on commercial paper issued by the Company.
Headquartered in San Francisco, California, Nektar Therapeutics is
a biopharmaceutical company.
NORDSTROM INC: Egan-Jones Retains B+ Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on September 19, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Nordstrom, Inc.
Headquartered in Seattle, Washington, Nordstrom, Inc. is a fashion
retailer of apparel, shoes, and accessories for men, women, and
children.
NUVO TOWER: Bayport Funding Says Disclosure Statement Inadequate
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Bayport Funding LLC objects to the adequacy of the Disclosure
Statement and Plan of Reorganization filed by Nuvo Tower LLC.
The Debtor is the fee simple owner of 4 adjacent lots of
non-residential real property located at, and known as: (i) 7
Brighton 5th Place, Brooklyn NY ("Lot 503"); (ii) 6 Brighton 5th
Place, Brooklyn NY ("Lot 507"); (iii) 2958 Brighton 6th Street,
Brooklyn, NY ("Lot 604"); and (iv) 2954 Brighton 6th Street,
Brooklyn, NY ("Lot 602", and collectively with Lot 503, Lot 507,
and Lot 604, the "Real Property").
By promissory note (the "Note"), dated August 7, 2017, Debtor
promised to repay Bayport $1,500,000.00 (the "Loan Amount"), plus
interest and fees, on or before August 7, 2018 (the "Maturity
Date"), borrowed by Debtor from the Bayport in connection with the
purchase of the Real Property.
As set forth in the Disclosure Statement and Plan, the terms of the
Plan: (a) treats Bayport as a member of Class 2 for an allowed
secured claim; (b) reduces Bayport's Claim to $2,250,709.05, with
accrued interest on the unpaid principal amount of $1,500,000 at an
interest rate to be determined; (c) requires the Debtor: (i)
refinance the Note and Mortgage within 150 days of the Effective
Date; (ii) sell the Real Property within 180 days of the Effective
Date; or (iii) conduct a public auction of the Real Property on the
210 day after the Effective Date; and (d) deems Bayport
unimpaired.
Bayport states that as set forth in the Claim Response, as of the
Petition Date, Debtor holds a claim secured by the Note and
Mortgage in the amount of $2,967,058.05. Notwithstanding the Claim
Objection, Bayport is confident the Court will agree that Claim
Amount is the correct amount.
Bayport points out that the time constraints contained within the
Disclosure Statement and Plan are egregious. Debtor was unable to
secure any financing, despite numerous funding commitments.
Moreover, since the Petition Date, despite Debtor's attorney's
numerous statements to the Court, Debtor has failed to provide any
evidence that the Debtor is making progress of debtor-in possession
("DIP") financing.
Bayport claims that prior to the Petition Date, Bayport has
established a sale date in the Foreclosure Action. However, Debtor
is now seeking an additional 210 day extension of time, in addition
to the time between the Petition Date and Effective Date, to
refinance or market and sell the Real Property prior to conducting
an auction, with no firm plans for either. This is clearly a
last-ditch effort by the Debtor to frustrate, hinder, and delay
Bayport in the Foreclosure Action.
Bayport asserts that its treatment as unimpaired is improper. The
debt owed to Bayport from the Debtor continues to accrue interest
each day that passes. As such, Debtor's Disclosure Statement and
Plan contemplates no payment by the Debtor, only additional accrued
debt by Bayport. As such, Bayport is impaired by the terms of the
Plan.
Bayport objects to the adequacy of the Disclosure Statement; and
terms of the Plan.
A full-text copy of Bayport's objection dated October 24, 2022, is
available at https://bit.ly/3U9vT8R from PacerMonitor.com at no
charge.
Attorneys for the Bayport:
MACCO LAW GROUP, LLP
Cooper J Macco
2950 Express Drive South, Suite 109
Islandia, New York 11749
(631) 549-7900
About Nuvo Tower
Nuvo Tower LLC is a single asset real estate (as defined in 11
U.S.C. Sec. 101(51B)). It owns four contiguous building lots
located at 2954-2958 Brighton 6th St. and 6-7 Brighton Fifth Place
in the Brighton Beach section of Brooklyn, which lots are intended
for construction of 23-unit condominium complex.
Nuvo Tower sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-41444) on June 22,
2022, listing $1 million to $10 million in both assets and
liabilities. Haim Pinhas, manager, signed the petition.
Judge Nancy Hershey Lord oversees the case.
Robert L. Rattet, Esq., at Davidoff Hutcher & Citron, LLP, is the
Debtor's counsel.
OAK PARENT: Moody's Rates $347MM Extended Secured Term Loan 'B3'
----------------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Oak Parent,
Inc.'s (Augusta Sportswear) extended senior secured term loan due
April 2025. All other ratings remain unchanged, including the
company's B3 corporate family rating. The outlook remains stable.
The amendment and maturity extension of the $347 million term loan
to April 2025 from October 2023 is a credit positive, as it
addresses Augusta Sportwear's near-term debt maturity while only
modestly increasing credit spread. Pro-forma for the transaction
and including the current SOFR rate, Moody's-adjusted
EBITA/interest expense will decline to an estimated 1.6x from 2.5x
as of July 2, 2022. The company's $40 million revolving credit
facility was also extended to April 2025 from October 2023.
Pro-forma for the transaction, revolver availability will be
impacted by a substantial draw to pay for amendment fees and
expenses, and balance sheet cash will also be very modest. However,
Moody's expects overall liquidity to be adequate over the next
12-18 months, including modestly positive free cash flow and a lack
of near-term debt maturities.
Moody's took the following rating actions for Oak Parent, Inc.:
Senior Secured Term Loan, assigned B3 (LGD3)
RATINGS RATIONALE
Augusta's B3 CFR reflects its narrow business focus and limited
revenue scale in the global apparel industry. The company competes
in a highly fragmented category with both retail brands and other
sports uniform distributors. The ratings also incorporate
governance risks, including private equity ownership and financial
and M&A strategies that led to high leverage prior to the
coronavirus pandemic. While revenue and earnings for the last
twelve months ended July 2, 2022 exceeded 2019 levels, leverage is
still high, at 5.9x Moody's-adjusted debt/EBITDA pro-forma for the
transaction. As an apparel company, Augusta Sportswear is also
subject to social and environmental factors including product and
supply chain sustainability.
The rating is supported by the company's defensible market position
in the wholesale team uniform, school-related sportswear and
dancewear markets, which drove strong operating margins and cash
flow generation prior to the pandemic. The ratings also consider
the limited level of fashion risk in the company's products,
product breadth and demand stability from the ultimate end users,
all of which drive resilient operating performance.
The stable outlook reflects Moody's expectations for continued
deleveraging and positive free cash flow.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if the company demonstrates sustained
improvement in revenue and earnings and good liquidity.
Quantitatively, ratings could be upgraded if Moody's-adjusted
debt/EBITDA was sustained below 5.75 times and EBITA/interest
expense above 1.75 times.
The ratings could be downgraded if the company's earnings or
liquidity were to deteriorate for any reason. Quantitively, the
ratings could be downgraded if Moody's-adjusted EBITA/interest
expense declines below 1.25 times.
The principal methodology used in these ratings was Apparel
published in June 2021.
Headquartered in Augusta, Georgia, Oak Parent, Inc. (Augusta
Sportswear), through its subsidiaries, manufactures and distributes
youth team sports uniforms, dance apparel and related products
serving customers in the United States. The company has been
majority owned by Kelso & Company, a private equity firm, since
2012, and does not publicly disclose financial information. Revenue
for the twelve months ended July 2, 2022 was less than $350
million.
OCCIDENTAL PETROLEUM: Egan-Jones Hikes Sr. Unsec. Ratings to BB+
----------------------------------------------------------------
Egan-Jones Ratings Company, on September 21, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Occidental Petroleum Corporation to BB+ from BB.
Headquartered in Houston, Texas, Occidental Petroleum Corporation
explores for, develops, produces, and markets crude oil and natural
gas.
OCEANEERING INTERNATIONAL: Egan-Jones Keeps B- Sr. Unsec. Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company, on September 16, 2022, retained its
'B-' foreign currency and local currency senior unsecured ratings
on debt issued by Oceaneering International, Inc.
Headquartered in Houston, Texas, Oceaneering International, Inc.
provides engineering services.
OFFICE DEPOT: Egan-Jones Hikes Senior Unsecured Ratings to B+
-------------------------------------------------------------
Egan-Jones Ratings Company, on September 21, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Office Depot, Inc. to B+ from B.
Headquartered in Boca Raton, Florida, Office Depot, Inc. operates a
chain of office product warehouse stores in North America, Europe,
Asia, and Central America.
ORION BAY ESTATES: Unsecured Creditors to Split $5K in Plan
-----------------------------------------------------------
Orion Bay Estates III, LLC, filed with the U.S. Bankruptcy Court
for the Central District of California a Disclosure Statement
describing Chapter 11 Plan of Reorganization dated October 24,
2022.
The Debtor is a California LLC created on May 11, 2020, as a real
estate holding company. Jeff Thompson is the sole and managing
member of the Debtor.
The Debtor currently owns one real property located at 2108
Gibraltar Road, Santa Barbara, CA 93105; APN 2005-004-5584. The
Debtor acquired the property in April 2021 for the purpose of
securing new plans and permits to ultimately develop the land.
The property was subject to the Santa Barbara 2009 "Tea Fire" that
swept through the entire Santa Barbara hillsides. At that time, the
property was owned by Stephen and Nanci Syson (the "Sysons") who
were building on the property. They had an outstanding loan with
Bank of Montecito, Class 1 claimant's first predecessor, for
$1,500,000 (at 6.125%) during the course of construction.
Mr. Thompson sought to work with Class 1 claimant to consensually
move the sale date, but the bank would not agree – the Sysons are
the named borrowers on the loan – and this case was filed so that
the property would not be lost.
The Debtor has created a concept for the property and the next step
to secure approval of final plans is to submit the design
development plans for approval to the Santa Barbara Design Review
Board ("SB DRB"). However, this project was previously approved (by
the original owners), so the Debtor is hopeful that it can be
fast-tracked for approval, given the land has sat vacant and
abandoned for the past ten years. The Debtor believes that full
plans will be approved by June 2023 for a building permit ready to
issue.
The Debtor believes that with the approval of the final plans, it
can sell the property for approximately $1,800,000. At this time,
Mr. Thompson will continue to fund all payment related to the
property, and all Plan payments.
Class 1 consists of the Secured Claim of Wells Fargo Bank, N.A.
Creditor (its successors or assigns) shall have an allowed fully
secured claim in the amount of $630,000 to be amortized over 30
years at a fixed interest rate of 5.75% per annum (the "Secured
Claim"). Creditor shall have a general unsecured claim in the
amount of $78,081.56, which shall be paid its pro-rata share with
other General Unsecured Claims under Debtor's Chapter 11 Plan.
Class 3 consists of General Unsecured Claims. In the present case,
the Debtor estimates that Class 6(a) general unsecured claims total
approximately $78,476. This class includes the unsecured portion of
Wells Fargo's claim. This class will be paid $5,000 without
interest by the Effective Date, to be shared pro rata among the
claimants. Upon entry of the discharge, the remainder of the
Debtor's unsecured debts will be discharged. This Class is
Impaired.
The Debtor's owner will retain his ownership interest in the
Debtor.
The Debtor intends to fund the Plan from contributions from its
managing member and any funds that it has accumulated in its
Debtor-in-Possession bank account.
A full-text copy of the Disclosure Statement dated October 24,
2022, is available at https://bit.ly/3zmAeO1 from PacerMonitor.com
at no charge.
Attorneys for Debtor:
Roksana D. Moradi-Brovia, Esq.
W. Sloan Youkstetter, Esq.
RHM LAW LLP
17609 Ventura Blvd., Suite 314
Encino, CA 91316
Telephone: (818) 285-0100
Facsimile: (818) 855-7013
Email: roksana@RHMFirm.com
sloan@RHMFirm.com
About Orion Bay Estates III
Orion Bay Estates III, LLC, filed a Chapter 11 bankruptcy petition
(Bankr. C.D. Calif. Case No. 21-16033) on July 28, 2021, listing as
much as $1 million in both assets and liabilities. Judge Deborah
J. Saltzman oversees the case. The Debtor is represented by Resnik
Hayes Moradi, LLP.
OUTFRONT MEDIA: Egan-Jones Keeps CCC Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on September 15, 2022, retained its
'CCC' foreign currency and local currency senior unsecured ratings
on debt issued by OUTFRONT Media Inc. EJR also retained its 'C'
rating on commercial paper issued by the Company.
Headquartered in New York, New York, OUTFRONT Media Inc. leases
advertising space on out-of-home advertising structures and sites.
OWENS & MINOR: Egan-Jones Keeps BB- Senior Unsecured Ratings
------------------------------------------------------------
Egan-Jones Ratings Company, on September 14, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Owens & Minor, Inc.
Headquartered in Virginia, Owens & Minor, Inc. distributes medical
and surgical supplies throughout the United States.
OXBOW CARBON: Moody's Affirms B2 CFR & Alters Outlook to Positive
-----------------------------------------------------------------
Moody's Investors Service changed the ratings outlook of Oxbow
Carbon LLC's to positive from stable. At the same time, Moody's
affirmed Oxbow's B2 corporate family rating, B2-PD probability of
default rating and a B1 rating of the senior secured revolving
credit facility (RCF), term loan A (TLA) and term loan B (TLB).
Affirmations:
Issuer: Oxbow Carbon LLC
Corporate Family Rating, Affirmed B2
Probability of Default Rating, Affirmed B2-PD
Senior Secured Term Loan A, Affirmed B1 (LGD3)
Senior Secured Multi Currency Revolver Credit Facility, Affirmed
B1 (LGD3)
Senior Secured Term Loan B, Affirmed B1 (LGD3)
Outlook Actions:
Issuer: Oxbow Carbon LLC
Outlook, Changed To Positive From Stable
RATINGS RATIONALE
The change in the outlook to positive reflects Oxbow's robust
operating and financial performance, improved credit profile and
Moody's expectations that Oxbow will remain free cash flow
positive, continue to reduce gross debt and maintain adjusted
leverage below 4x in a more normalized commodity price
environment.
Oxbow's B2 CFR reflects its strong global industry position in the
production and sale of calcined petroleum coke (CPC), marketing and
distribution of fuel-grade petcoke (FGP), its broad geographic
diversification, high industry barriers to entry and good
liquidity. Oxbow benefits from the stability provided by the
company's long-standing relationships with global steel and
aluminum producers and relatively less volatile operating margins
than other producers given that operating earnings of its calcining
segment are generally based on the net spread between the green
petcoke (GPC) and CPC prices. The rating factors in Oxbow's modest
size and significant exposure to cyclical steel, aluminum, cement
and other industrial end-markets. Oxbow's rating is also
constrained by its limited business diversification given its
reliance on the calcining and FGP marketing segments for the vast
majority of its revenues and cashflows. However, Oxbow's position
as one of the largest third party provider of distribution and
logistics services worldwide provides some diversification benefits
from its major lines of business.
Oxbow's credit profile has improved materially over the last twelve
months. Broad global economic recovery in 2021 and a rebound in
primary aluminum smelting, steelmaking and industrial activities
led to a rebound in demand and material improvement in prices for
CPC, FGP and Distribution segment services. This trend continued in
H1 2022 supported by record aluminum prices, supply constraints
worsened by Russia's invasion of Ukraine and cost inflation driving
up the prices of most commodities. As a result, high realized
prices and moderate volume recovery more than offset higher GPC,
labor, other costs and working capital build-up allowing the
company to expand margins and generate strong EBITDA and $105
million in free cash flow (net of dividends) in the LTM ended June
30, 2022. As a result of higher earnings, Oxbow's leverage,
measured as Moody's-adjusted debt/EBITDA, improved to 1.8x as of
June 30, 2022.
Moody's believes that current CPC and FGP prices are not
sustainable and will moderate over the next 6-12 months due to
lower demand from the aluminum industry and reduced industrial
demand. High oil prices and persistent inflationary pressures will
likely keep input and other costs elevated, leading to a
contraction in operating margins. However, Moody's also expects CPC
and FGP prices to remain elevated and well above historical levels
due to continued supply constraints, captive capacity closures and
strong demand for FGP which is typically used either as source of
energy or carbon depending on the application. This should support
strong earnings, free cash flow generation for Oxbow and gross debt
reduction. Moody's anticipates that Oxbow's leverage will increase
to 2.5-3.0x in the next 12-18 months but will remain below 4x, the
current ratings upgrade trigger.
The positive outlook reflects Moody's view that despite
deteriorating macro environment Oxbow will continue to generate
strong earnings and positive free cash flow and maintain solid
metrics and leverage profile in a more normalized price
environment.
As a producer of carbon-based products and a supplier of key input
ingredients for the steel and primary aluminum industries, Oxbow
faces high ESG risks. Many of the company's calcining plants do not
have flue gas desulfurization systems installed and are significant
emitters of sulfur dioxide. Although the company has followed
mostly balanced financial policy, balancing dividend payments and
debt reduction, governance risk is high given the management's and
ownerships tolerance for elevated gross debt levels, inherent
volatility of the industry that requires stringent risk management
and the history of significant owner distributions.
Oxbow has good liquidity supported by $124 million of cash and $157
million available under the $325 million revolver. The company pays
amortization of 10% and 5% on TLA and TLB, respectively, amounting
to a contractual repayment of $45 million per year plus customary
ECF sweep. As of June 30, 2022, the company was in compliance with
the financial covenants on the RCF and TLA with a substantial
cushion. Term loan B does not have any financial covenants.
The B1 ratings of the first-lien senior secured revolver and term
loans, one notch above B2 CFR, reflect their 1st lien priority
position in the capital structure with respect to claim on
collateral, which is substantially all assets of the company and
the stock of subsidiaries.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade would be considered if the company maintains
consistently positive free cash flow, makes further progress toward
gross debt reduction and demonstrates that it is able to maintain
leverage below 4.0x on a sustainable basis and in a more normalized
price environment. An upgrade also assumes that the company can
demonstrate a clear path to refinancing of its 2024 and 2025
maturities. The ratings and/or the outlook could be downgraded if
liquidity deteriorates or if leverage is sustained persistently
above 5.5x.
Headquartered in West Palm Beach, Florida, Oxbow Carbon LLC (Oxbow)
is a major producer and supplier of calcined petroleum coke (CPC).
It is also among the world's largest distributors of carbon-based
fuels including fuel grade petcoke (FGP) and other products.
Revenue for the 12 months ended June 30, 2022 was about $2.4
billion. Oxbow is a subsidiary of Oxbow Carbon & Minerals Holdings,
Inc., a private company controlled by William I. Koch, with private
equity and strategic investors comprise the remaining shareholders.
The company does not publicly disclose financial information.
The principal methodology used in these ratings was Steel published
in November 2021.
PANHANDLE PAWN: $405K Sale of Marianna Property Rendered Moot
-------------------------------------------------------------
Judge Karen K. Specie of the U.S. Bankruptcy Court for the Northern
District of Florida rendered moot Panhandle Pawn & Gun, LLC's
private sale of the commercial property where it operates, which is
located at 2545 Commercial Park Drive, in Marianna, Florida 32446,
to Realo Properties, LLC, for $405,000, free and clear of liens.
About Panhandle Pawn & Gun
Panhandle Pawn & Gun, LLC filed a petition under Chapter 11,
Subchapter V of the Bankruptcy Code (Bankr. N.D. Fla. Case No.
22-50007) on Jan. 26, 2022, listing as much as $1 million in both
assets and liabilities. Jodi D. Dubose serves as Subchapter V
trustee.
Judge Karen K. Specie oversees the case.
Byron Wright, III, Esq., at Bruner Wright, P.A. serves as the
Debtor's legal counsel.
PARK HOTELS: Egan-Jones Retains B+ Senior Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company, on September 20, 2022, retained its
'B+' local currency senior unsecured ratings on debt issued by Park
Hotels & Resorts Inc.
Headquartered in Tysons, Virginia, Park Hotels & Resorts Inc. owns
and operates hotels.
PHASEBIO PHARMA: Oct. 31 Deadline Set for Panel Questionnaires
--------------------------------------------------------------
The United States Trustee is soliciting members for committee of
unsecured creditors in the bankruptcy case PhaseBio
Pharmaceuticals, Inc.
If a party wishes to be
If a party wishes to be considered for membership on any official
committee that is appointed, it must complete a Questionnaire
available at https://bit.ly/3DvUorm and return by email it to Jane
M. Leamy -- Jane.M.Leamy@usdoj.gov -- at the Office of the United
States Trustee so that it is received no later than 4:00 p.m., on
Oct. 31, 2022.
If the U.S. Trustee receives sufficient creditor interest in the
solicitation, it may schedule a meeting or telephone conference for
the purpose of forming a committee.
About PhaseBio Pharmaceuticals
PhaseBio Pharmaceuticals, Inc. -- https://www.phasebio.com/ -- is
focused on the development and commercialization of novel therapies
to treat orphan diseases, with an initial focus on cardiopulmonary
indications.
PhaseBio Pharmaceuticals filed a petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. D. Del. Case No. 22-10995) on
Oct. 24, 2022. In the petition filed by Jonathan Mow, as chief
executive officer, the Debtor reported $17,970,000 in assets and
$21,320,000 in debt as of Aug. 31, 2022.
The Debtor tapped Cooley LLP as lead bankruptcy counsel; Richards,
Layton & Finger, P.A., as Delaware bankruptcy counsel;
SierraConstellation Partners LLC as financial advisor; and Miller
Buckfire & Co. as investment banker. Omni Agent Solutions is the
claims agent.
PHILLIP B. SCOTT: Radicle Offers $269K for Rock Island Property
---------------------------------------------------------------
Phillip B. Scott asks the U.S. Bankruptcy Court for the Central
District of Illinois to authorize the sale of a tract of land in
downtown Rock Island, Illinois, known as "Cabanas," located at 414
2nd Street, in Rock Island, Illinois 61201, to Radicle Venture,
LLC, for $269,000.
Scott owns several parcels of real estate including the Cabanas and
a second tract known as "The Sea Turtle." The motion concerns only
Cabanas and upon receipt of a Purchase Agreement for The Sea
Turtle, a separate motion will be filed.
Cabanas is comprised of numerous parcels from the real estate
records of Rock Island County with a legal description of:
LEGAL DESCRIPTION
Tract 1: Lot Number Four (4) except that East Twenty-Five
and Forty-Two Hundred (25-42) feet of the North Ninety (90) feet in
Block Number Sixteen (16) in that part of the City of Rock Island
known as and called Spencer and Case's Addition to said City;
situated in Rock Island County, Illinois, together with an Easement
of Ingress and Egress on and upon the South Eighteen (18) feet of
the following described premises; the East 25.42 feet of the North
Ninety (90) feet of Lot Four (4), Block Sixteen (16) in that part
of the City of Rock Island, known as and called Spencer & Case's
Addition to said City, situated in the County of Rock Island, State
of Illinois.
Tract 2: The East 25.42 feet of the North 49.50 feet of
Lot 4, Block 16 in that part of the City of Rock Island, known as
and called Spencer and Case's Addition to said City; situated in
the County of Rock Island and State of Illinois.
ALSO: The South 40.25 feet of the East 25-42 feet of the
North 90 feet of Lot 4, Block 16 in that part of the City of Rock
Island known as and called Spencer and Case's Addition to said
City, situated in the County of Rock Island and State of Illinois,
ALSO: The North One Hundred Twenty (120) feet of Lot
Number Five (5) in Block Number Sixteen (16) in that part of the
City of Rock Island known as and called Spencer and Case's Addition
to said City, excepting the following: Beginning at a point Thirty
(30) feet North of the Southeast corner of said Lot, thence at
right angles, West Sixty (60) feet; thence at right angles, North
Thirty (30) feet; thence at right angles, East Ten (10) feet;
thence at Right angles, South Four (4) feet; thence at right angles
East Fifty (50) feet, thence at right angles, South Twenty-six (26)
feet to the place of beginning; situated in the County of Rock
Island, in the State of Illinois.
Tract 3: The part of Lot Number Five (5) in Block Number
Sixteen (16) in Spencer & Case's Addition to the City of Rock
Island, Rock Island County, Illinois, described as follows, to wit:
Commencing at the Southeast Comer of said Lot Number Five (5),
thence running West along the South line of said Lot Sixty (60)
feet to the Southwest corner thereof; thence running North along
the West line of said Lot, Sixty (60) feet, thence running East at
right angles to said West line, Ten (10) feet, thence running South
at right angles Four (4) feet; thence running east at right angles
Fifty (50) feet to the East line of said Lot Five (5); thence
running South along the East line of said Lot, Fifty-Six (56) feet
to the point of commencement; situated in the County of Rock Island
and State of Illinois, with a common address of 2120 4th Avenue
Rock Island, IL.
Scott now desires to sell Cabanas in a private sale and a Purchase
Agreement has been received, approved and executed by Scott and
Richard and Cristina Nunez subject to Bankruptcy Court approval.
Such sale will be free and clear of all liens.
Any outstanding real estate taxes including appropriate pro-rata
amounts will be paid from the proceeds from the sale. The mortgage
lien of BankOrion will also be distributed to apply to BankOrion's
first mortgage excepting only the usual and customary closing costs
and fees, and counsel's modest carve-out.
A small carve-out of $10,000 for Scott's costs and expenses to
repair the property and complete the sale, including a new roof
contingency and other costs and expenses prior to sale.
A copy of the Contract is available at https://tinyurl.com/5y3zx9tx
from PacerMonitor.com free of charge.
Phillip B. Scott sought Chapter 11 protection (Bankr. C.D. Ill.
Case No. 21-80693) on Sept. 30, 2021. The Debtor tapped Dale G.
Haake, Esq., at Katz Nowinski P.C. as counsel.
POMPANO SENIOR: Unsecureds to Recover 100% in Subchapter V Plan
---------------------------------------------------------------
Pompano Senior Squadron Flying Club, Inc., filed with the U.S.
Bankruptcy Court for the Southern District of Florida a Plan for
Reorganization for Small Business under Subchapter V dated October
24, 2022.
The Debtor is a corporation which operates as a tax exempt not for
profit entity. The debtor operates a flying club for the benefit of
its members which includes the ownership, operation and lease of
aircraft flown by its members for pleasure as well as instructional
purposes. The debtor operates in Pompano Beach, Florida and its
business premises (hanger) are leased.
The Plan Proponent conservatively projects that its cash flow on a
monthly basis will generate sufficient cash flow to fund the
quarterly payments proposed under the plan. The debtor's monthly
operating reports as well as the debtor's projected budget
demonstrate positive cash flow which exceeds the maximum payment to
allowed claims required under the plan as proposed.
This Plan of Reorganization proposes to pay creditors from its
ordinary monthly income.
Non-priority unsecured creditors holding allowed claims will
receive distributions, which the proponent of this Plan has valued
at approximately 100 cents on the dollar. This Plan also provides
for the payment of administrative and priority claims.
Class 3 consists of General Unsecured Claims. The holders of
allowed unsecured claims shall receive distribution in the amount
which is the lesser of 1) payment full on account of their claim by
the receipt of 20 quarterly distributions in the amount of 1/20 of
the amount of the allowed claim with such distributions beginning
January 1, 2023 and continuing until the amount of the claim is
paid in full or 2) pro rata quarterly distribution of $10,000. The
Debtor estimates that payment will yield 100% to allowed claims
after disputed claims are liquidated. This Class is Impaired.
Class 3.1 consists of the Proof of Claim of Paul Sanchez. This
class represents all claims of Paul Sanchez, including those
scheduled by the Debtor as disputed on Schedule D, who filed an
unsecured proof of claim, Claim Number 3, and who is a member and
an insider of the debtor. Following objections, the allowed amount
of the Claims of Paul Sanchez shall be treated and paid along with
other Class 3 claims on account of any allowed claim.
Class 4 consists of Equity Interest. Property of the estate shall
revest in the Debtor who shall retain its interests in property.
The Debtor shall receive the proceeds of any property, including
the proceeds of any sale under the plan following payment of claims
pursuant to the treatment set forth in this plan. Equity interests
in the Debtor shall be cancelled and each equity member shall
receive, on account and in full consideration of its prior equity
interest and any equity claim, 1 share in the reorganized debtor,
which shall fully vest as of the Effective Date of the plan.
Shareholders shall have no capital account or retained equity as of
confirmation of the Plan.
Property of the estate shall revest in the debtor, and the
treatment under the plan shall be funded by the Debtor's ordinary
cash flow income. In the event that such income is insufficient to
service the debt, the Debtor reserves the right to assess
additional membership fees or equity contributions as provided by
its By-Laws.
A full-text copy of the Plan of Reorganization dated Oct. 24, 2022,
is available at https://bit.ly/3Wd68Gs from PacerMonitor.com at no
charge.
Counsel for Debtor:
CRAIG A. PUGATCH
LORIUM LAW
101 NE 3rd Avenue, Suite 1800
Fort Lauderdale, Florida 33301
Telephone: (954) 462-8000
Facsimile: (954) 462-4300
Email: capugatch@loriumlaw.com
About Pompano Senior Squadron Flying Club
Pompano Senior Squadron Flying Club, Inc., filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
S.D. Fla. Case No. 22-15714) on July 26, 2022, listing $100,001 to
$500,000 in both assets and liabilities. Craig A. Pugatch, Esq.,
at LORIUM LAW, is the Debtor's counsel.
PORTOFINO TOWERS: Plan Hearing Continued to Dec. 6
--------------------------------------------------
Judge A. Jay Cristol has entered an order that the hearings for
Portofino Towers 1002, LLC, on the following matters are continued
to Dec. 6, 2022, at 3:00 p.m. The hearings will be conducted by
telephone conference through Court Solutions LLC:
* Chapter 11 Plan and Disclosure Statement filed by debtor
Portofino Towers 1002 LLC.
* Creditor Bank of America, N.A.'s objection to confirmation of
Chapter 11 Plan and Disclosure Statement.
* Amended Application for Interim Compensation filed by Attorney
Joel M. Aresty, Esq.
* Objection to Claim No 3. of Portofino/South Pointe Master
Association, Inc., and claim No 4 of Portofino Towers Condominium
Association, Inc. and Claims 2 and 6 of creditor Heagrand, Inc.
* Joint opposition to objection to claims of Secured creditors,
Portofino/ SouthPointe Master Association, Inc., and Portofino
Towers Condominium Association, Inc.
* Heabrand's response in opposition to objection to claim.
About Portofino Towers 1002
Portofino Towers 1002, LLC, owns a condo at 300 S Pointe Dr. Unit
1002, Miami Beach, Fla.
Portofino Towers 1002 filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
20-20446) on Sept. 27, 2020, listing up to $10 million in both
assets and liabilities. Laurent Benzaquen, authorized member,
signed the petition.
The cases are assigned to Judge A. Jay Cristol.
Joel M. Aresty, Esq. at Joel M. Aresty P.A., is the Debtor's legal
counsel.
PUERTO RICO: Pays $492 Mil. to Cover Cofina Debt Service
--------------------------------------------------------
Michelle Kaske of Bloomberg News reports that Puerto Rico
transferred $492 million to pay principal and interest costs
through June 30 on the island's restructured sales-tax bonds.
The commonwealth agency that issued the bonds, called Cofinas,
deposited the sales-tax revenue with Bank of New York Mellon,
trustee for the securities, according to a filing to bondholders on
the Municipal Security Rulemaking Board's Web site.
The island dedicates 5.5% of its sales-tax revenue collections to
repaying Cofinas Puerto Rico in February 2019 reduced its
outstanding Cofina debt by about $5.5 billion when it sold $12
billion of new securities backed by the sales-tax receipts in a
debt exchange.
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.
* * *
Title III plans of adjustment have been confirmed for the
Commonwealth and COFINA debtors.
RADIATE HOLDCO: Moody's Affirms B2 CFR & Alters Outlook to Negative
-------------------------------------------------------------------
Moody's Investors Service changed Radiate HoldCo, LLC's outlook to
negative, from stable. The B2 Corporate Family Rating, B2-PD
Probability of Default rating, and all instrument ratings including
the B1 Senior Secured Credit Facility rating, B1 Senior Secured
Notes, and Caa1 Senior Unsecured Note rating were affirmed.
Affirmations:
Issuer: Radiate HoldCo, LLC
Corporate Family Rating, Affirmed B2
Probability of Default Rating, Affirmed B2-PD
Senior Secured Bank Credit Facility, Affirmed B1 (LGD3)
Senior Secured Regular Bond/Debenture, Affirmed B1 (LGD3)
Senior Unsecured Regular Bond/Debenture, Affirmed Caa1 (LGD6)
Outlook Actions:
Issuer: Radiate HoldCo, LLC
Outlook, Changed To Negative From Stable
The change in outlook to negative was based on Moody's view that
the Company's weakened operating and financial performance will
continue over the next 12-18 months due to a combination of
unfavorable trends, particularly inflationary pressures and more
intense competition. As a result, key credit metrics including
leverage (Moody's adjusted debt/EBITDA) and free cash flow (FCF) to
debt will remain outside Moody's tolerances, with the leverage
ratio sustained between 7.1x-7.2x, and FCF to debt projected to be
0%-1%.
RATINGS RATIONALE
Radiate's credit profile reflects the Company's moderate scale and
highly negative governance risk, reflecting financial strategy and
risk management policies that tolerate high leverage (above 7x,
Moody's adjusted) and material periodic shareholder distributions.
Ownership and control are also highly concentrated within a single
private equity firm. Capital intensity is high, with investments in
the high 20% range of revenue and a rising interest burden (with
weighted average cash interest greater than 5%, including hedges),
producing limited to no free cash flow. The Company's market
position is weak, due to its mostly overbuilder operating strategy.
This is evident in subscriber trends and penetration rates well
below the peer group (e.g. U.S. rated cable operators) average,
including some measures ranked near the bottom. More intense
competition has slowed the broadband growth engine, with subscriber
trends flat to slightly down while video and voice subscribers are
declining at high and accelerated rates of at least high single to
mid-teens percent, respectively. The weakness is reflected in
below average performance metrics including EBITDA to homes passed
($186) and Triple Play Equivalent (TPE; defined as a simple average
of the company's three main product penetration rates) that will
fall below 14%. Despite these challenges, the business model is
very predictable, with a range of monthly subscription services
paid for by a large and very diverse customer base. Supporting the
business are valuable assets, specifically a fiber-rich high-speed
communication network with leading-edge technology. Profitability
is also strong and stable, with EBITDA margins steady at near 45%.
Radiate has good liquidity supported by cash and positive operating
cash flow, a mostly undrawn revolver, springing covenants with
solid headroom, and a favorable maturity profile with no near-term
maturities until 2025.
The instrument ratings reflect the probability of default of the
Company, as reflected in the B2-PD Probability of Default Rating,
an average expected family recovery rate of 50% at default given
the mix of secured and unsecured debt in the capital structure, and
the particular instruments' claim priorities. Moody's rates the
senior secured bank credit facilities and senior secured notes B1
(LGD3), one notch above the CFR with a fully secured priority claim
on all assets. The unsecured notes are rated Caa1 (LGD6), two
notches below the CFR with the subordination to secured bank
lenders.
The company's ESG Credit Impact Score is CIS-4, highly negative.
The CIS score primarily reflects a financial strategy that
tolerates high leverage and concentrated voting control. Social
risks are also moderately negative given exposure to risk in
customer relations. Environmental risks are neutral-to-low, having
little effect (positive or negative) on the CIS score.
Moody's outlook reflects uncertainty about the performance outlook
given weak recent trends, with a baseline expectation that revenue
will decline by the low single digit percent over the next 12-18
months, dropping revenue under $1.7 billion. Direct costs will fall
but SG&A will rise, producing EBITDA that will range near $750
million, down from over $800 million in 2021. Regardless, EBITDA
margins will hold steady at near 45%. Moody's expects leverage to
be sustained over 7x, on debt near $5.4 billion. Free cash flow
will be limited, covering less than 1% of debt. Moody's outlook
reflects certain key assumptions including moderating but still
high capital intensity (CAPEX to revenues in the high 20% range)
and average borrowing costs near 5% (cash interest with hedges).
Moody's expects liquidity to remain good.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could consider a positive rating action if total gross
debt/EBITDA (Moody's adjusted) is sustained below 5.0x; and free
cash flow to total gross debt (Moody's adjusted) is sustained above
5.0%. A positive rating action would also be considered if scale or
diversity rose and or market position improved materially.
While Moody's expects good liquidity and a favorable maturity
profile to be supportive over the near term, the ratings could come
under pressure if the Company's performance does not improve
meaningfully or other credit positive corporate actions are not
taken to delever within Moody's tolerances over the rating horizon.
Moody's could consider a negative rating action if total gross
debt/EBITDA (Moody's adjusted) is expected to be sustained above
6.5x, or free cash flow to total gross debt (Moody's adjusted) is
sustained below low single-digit percent. A negative rating action
could also be considered if liquidity deteriorates, scale or
diversity declined, or operating performance declined materially,
on a sustained basis.
Radiate, based in Princeton, New Jersey, is the parent of RCN
Telecom Services, LLC, Grande Communications Networks LLC, and Wave
Broadband, d/b/a/ Astound Broadband. The Company provides video,
high-speed internet and voice services to residential and
commercial customers in 18 markets located on the West coast, the
Northeast coast and Chicago and Texas. As of the period ended June
30, 2022, the Company served approximately 320 thousand video,
1,114 thousand HSD, and 258 thousand voice subscribers. Revenue for
the last twelve months ended June 30, 2022 was approximately $1.65
billion. Radiate is majority owned and controlled by Stonepeak
Infrastructure Partners, with TPG Capital and executive management
(Patriot Media Consulting) holding minority interests.
The principal methodology used in these ratings was Pay TV
published in October 2021.
REAMIR 57 CORP: Has Until Jan. 31, 2023 to File Plan and Disclosure
-------------------------------------------------------------------
Judge Nancy Hershey Lord has entered an order that pursuant to
section 1121(e) of the Bankruptcy Code, the Reamir 57 Corp.'s time
period to file a Chapter 11 Small Business Plan of Reorganization
and Disclosure Statement is further extended from Nov. 2, 2022,
through and including January 31, 2023.
The extension granted is without prejudice to such further requests
that may be made pursuant to section 1121(e) of the Bankruptcy Code
by the Debtors or any party in interest, for cause shown, upon
notice and a hearing.
About Reamir 57 Corp.
Reamir 57 Corp. filed a Chapter 11 bankruptcy petition (Bankr.
E.D.N.Y. Case No. 21-42294) on Sept. 8, 2021, disclosing as much as
$1 million in both assets and liabilities. Judge Nancy Hershey
Lord oversees the case. The Debtor tapped the Law Offices of Alla
Kachan, P.C. as its legal counsel and Wisdom Professional Services,
Inc. as its accountant.
RENT-A-CENTER INC: Egan-Jones Retains BB Senior Unsecured Ratings
-----------------------------------------------------------------
Egan-Jones Ratings Company, on September 22, 2022, retained its
'BB' foreign currency and local currency senior unsecured ratings
on debt issued by Rent-A-Center, Inc.
Headquartered in Pano, Texas, Rent-A-Center, Inc. operates
franchised and company-owned Rent-A-Center and ColorTyme
rent-to-own merchandise stores.
RESTLAND MEMORIAL: Sale of Monroeville Property for $100K Denied
----------------------------------------------------------------
Judge Gregory L. Taddonio of the U.S. Bankruptcy Court for the
Western District of Pennsylvania denied Restland Memorial Parks,
Inc.'s sale of rights to be interred to 500 spaces located at 990
Patton Street Ext., Monroeville, PA 15146-4635, within defined
Parcel #544-H-128 to the Muslim Community Center of Greater
Pittsburgh for $100,000 for want of jurisdiction.
Because the Court finds no material issue with the sale itself, and
the Reorganized Debtor is within its rights to proceed with the
sale absent Court approval, nothing in the Order will prejudice its
efforts to consummate the sale on its own.
About Restland Memorial Parks
Restland Memorial Parks, Inc., a Monroeville, Pa.-based company
that offers cemetery pre-need programs, sought protection under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No.
21-21148) on May 7, 2021. At the time of the filing, the Debtor
disclosed total assets of up to $10 million and total liabilities
of up to $1 million. Judge Gregory L. Taddonio oversees the case.
The Debtor tapped Calaiaro Valencik as its legal counsel and Teri
Hayes Small Business Solutions as its accountant.
REVLON INC: Egan-Jones Hikes Senior Unsecured Ratings to CC
-----------------------------------------------------------
Egan-Jones Ratings Company, on September 16, 2022, upgraded the
foreign currency and local currency senior unsecured ratings on
debt issued by Revlon, Inc. to CC from D. EJR also upgraded the
rating on commercial paper issued by the Company to C from D.
Headquartered in New York, New York, Revlon, Inc. manufactures,
markets, and sells beauty and personal care products.
ROWAN SAWDUST: Bankr. Administrator Asks for Feasibility Analysis
-----------------------------------------------------------------
J. Thomas Corbett, United States Bankruptcy Administrator for the
Northern District of Alabama filed an objection to Rowan Sawdust
and Shavings, LLC's Disclosure Statement and Plan Summary.
The Bankruptcy Administrator asserts that:
* The Disclosure Statement does not provide a feasibility
analysis.
* Exhibit G does not provide the correct interest factor for
unsecured claims.
* The description of the Debtor should be enhanced to address
recent developments and operations since acquiring Davis Leasing,
LLC, a subsidiary of the Debtor, including financial information of
Davis Leasing, LLC, to clearly show that the Plan is feasible.
* All compensation and benefits of insiders should be disclosed
whether such is paid from the Debtor directly or by a subsidiary.
According to the Bankruptcy Administrator, Section X of the
Disclosure Statement should expressly state that upon confirmation
the Debtor will receive a discharge as permitted by 11 U.S.C.
Section 1141(d) and it should expressly state that property of the
estate will vest in the Debtor upon confirmation under 11 U.S.C.
Section 1141(b).
About Rowan Sawdust and Shavings
Rowan Sawdust and Shavings, LLC, an Altoona, Ala.-based company
that offers animal bedding and transport services, filed a
voluntary petition for relief under Chapter 11 of the Bankruptcy
Code (Bankr. N.D. Ala. Case No. 22-40262) on March 21, 2022,
listing up to $50,000 in assets and up to $10 million in
liabilities. Kevin Rowan, manager, signed the petition.
Judge James J. Robinson oversees the case.
Tameria S. Driskill, Esq., at Williams Driskill Huffstutler & King,
serves as the Debtor's legal counsel.
RYDER SYSTEM: Egan-Jones Retains BB+ Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its
'BB+' foreign currency and local currency senior unsecured ratings
on debt issued by Ryder System, Inc.
Headquartered in Miami, Florida, Ryder System, Inc. provides a
continuum of logistics, supply chain, and transportation management
solutions worldwide.
S B BUILDING: Exclusivity Period Extended to March 21
-----------------------------------------------------
S B Building Associates Limited Partnership and its affiliates
received court approval to remain in control of their bankruptcy
until early next year.
Judge Vincent Papalia of the U.S. Bankruptcy Court for the District
of New Jersey extended the companies' exclusive right to file a
Chapter 11 plan to March 21 and to solicit acceptances for the plan
to May 20.
The companies will use the extension to engage in discussions with
creditors and other parties to ensure that, when a plan is filed,
it will be consensual so that their bankruptcy cases can proceed to
an expeditious conclusion, according to their attorney, Morris
Bauer, Esq., at Duane Morris, LLP.
About S B Building Associates
S B Building Associates Limited Partnership and its affiliates, SB
Milltown Industrial Realty Holdings, LLC and Alsol Corporation, are
owners in fee of contiguous parcels located on Ford Avenue in the
Borough of Milltown, Middlesex County, N.J. The contiguous parcels
were the former location of a Michelin Tire facility.
S B Building Associates and its affiliates sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D.N.J. Lead Case No.
22-14231) on May 25, 2022. In the petition filed by Lawrence S.
Berger, as manager, S B Building Associates listed between $10
million and $50 million in both assets and liabilities.
Judge Vincent F. Papalia oversees the cases.
Morris S. Bauer, Esq., at Duane Morris, LLP is the Debtor's
counsel.
S.A. WAGNER: Seeks Approval to Hire a Bookkeeper
------------------------------------------------
S.A. Wagner Agency, Inc. seeks approval from the U.S. Bankruptcy
Court for the Western District of Pennsylvania to employ a
bookkeeper.
Services the bookkeeper will render are:
(1) prepare the required financial reports;
(2) assist in analyzing possible objections to claims;
(3) assist in winding-down the business; and
(4) assist in implementing the Plan and closing the case.
Michelle Pacy, the proposed bookkeeper, served as the bookkeeper
for the Debtor for more than 15 years. The Debtor is proposing to
retain Ms. Pacy on an hourly basis at $30 per hour for the
remainder of these bankruptcy proceedings.
The Debtor anticipates that the total aggregate payments to Ms.
Pacy will not exceed $2,500.
The bookkeeper can be reached at:
Michelle Pacy
2613 Hudson Road
Erie, PA X508
About S.A. Wagner Agency
S.A. Wagner Agency, Inc. -- https://www.sawagner.com -- is an
insurance company that provides the right commercial, personal, and
life insurance policies based on clients' needs.
S.A. Wagner Agency filed a petition for relief under Subchapter V
of Chapter 11 of the U.S. Bankruptcy Code (Bankr. W.D. Pa. Case No.
22-10258) on June 8, 2022, listing up to $1 million in assets and
up to $10 million in liabilities. William G. Krieger has been
appointed as Subchapter V trustee.
Guy C. Fustine, Esq., at Knox McLaughlin Gornall & Sennett, PC and
Jeffrey Beach, CPA, at McGill, Power, Beil & Associates, LLP serve
as the Debtor's counsel and accountant, respectively.
SIX FLAGS: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
---------------------------------------------------------
Egan-Jones Ratings Company, on September 16, 2022, retained its
'CCC+' local currency senior unsecured ratings on debt issued by
Six Flags Entertainment. EJR also retained its 'B' rating on
commercial paper issued by the Company.
Headquartered in Arlington, Texas, Six Flags Entertainment
Corporation operates regional theme parks across North America.
SM ENERGY: Egan-Jones Retains B+ Senior Unsecured Ratings
---------------------------------------------------------
Egan-Jones Ratings Company, on September 22, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by SM Energy Company.
Headquartered in Denver, Colorado, SM Energy Company is an
independent energy company that explores for and produces natural
gas and crude oil.
SOUTHWESTERN ENERGY: Egan-Jones Retains B Senior Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by Southwestern Energy Production Company.
Headquartered in Houston, Texas, Southwestern Energy Production
Company explores, develops, and produces energy products.
SPG HOSPICE: Trustee's Amended Plan to Repay Claims in 5 Years
--------------------------------------------------------------
James E. Cross, the Chapter 11 Trustee for SPG Hospice, LLC,
Scottsdale Physicians Group, PLC, and United Telehealth Corp.,
filed a First Amended Chapter 11 Plan and a corresponding First
Amended Disclosure Statement on Oct. 19, 2022.
A Disclosure Statement and related Plan were filed by the Trustee
on August 17, 2022. The Trustee's Plan proposed two options: (1)
repayment over five-year plan, or (2) Section 363 sale a sale of
all three Debtor entities as part of the plan confirmation
process.
Subsequently, the U.S. Department of Justice filed Proofs of Claim
in each of these bankruptcy cases in the amount of $589 million.
(Claim 15-1 filed in 22- 02385, Claim 41-1 in 22-02388-EPB, and
Claim 9-1 in 22- 02409) (the "DOJ Claim"). The DOJ Claim rests on
allegations that prior to the Petition Date, and while the Debtors
were being operated by Nima Ghadimi, that:
* The Debtors violated the False Claims Act, 31 U.S.C. Secs.
3729-33 (the "FCA"), by virtue of funds that Debtors received on
account of allegedly false claims for payment that the Debtors
allegedly knowingly submitted or caused to be submitted to the
Medicare Program, Title XVIII of the Social Security Act, 42 U.S.C.
Secs. 1395-1395kkk-1 (Medicare), the TRICARE Program, 32 C.F.R Sec.
199 et seq. (TRICARE);
* The Debtors allegedly submitted improper applications to the
Small Business Administration to obtain funds through the Paycheck
Protection Program (PPP), enacted by Section 1102 of the CARES Act,
Pub. L. No. 116-136 (March 27, 2020); and
* The Debtors are allegedly liable for treble damages and civil
penalties.
The Debtors dispute that they are liable for any of the conduct
alleged in the DOJ Claim, and that instead, Ghadimi should be
personally liable as he made all decisions and directed any
conduct, that forms the basis of the DOJ Claim. Nevertheless, the
Debtors intend to seek the employment of an independent auditor to
investigate these allegations. The Debtors believe that such audit
shall be concluded by December 1, 2022.
However, the significance of the effect of the DOJ Claim has
warranted the filing of this First Amended Disclosure Statement,
which pertains to the Trustee's First Amended Chapter 11 Plan filed
by the Trustee on October 19, 2022. Simply put, with the specter
of the DOJ Claim over the Debtors, a sale pursuant to 11 U.S.C.
Sec. 363
to a third-party is no longer a viable option.
Consequently, the Trustee's First Amended Plan proposes repayment
of all allowed claims over five-years:
* Payment of all Allowed Administrative Claims and Allowed
Priority Unsecured Claims;
* Payment in full of all Allowed Secured Claims;
* Pro rata or full payment of all Allowed Unsecured Claims;
* Cancellation of existing equity interests in the Debtors; and
* Pursuit of litigation claims through a Litigation Trust or
similar entity.
Under the Plan, holders of Class 3 Allowed General Non-Provider
Unsecured Claims will receive on account of their allowed claim a
distributions from the remaining assets of the estate, recoveries
from the Litigation Trust and operating profits from the
Reorganized Debtors on the later of: (1) no later than five years
following the Effective Date, or (2) within 10 business days after
such claim becomes an allowed claim. The Class 3 claims are
impaired and holders thereof are entitled to vote to accept or
reject the Plan. Class 3 claimholders may not elect to exchange
their allowed claims for a corresponding equity interest in the
Reorganized Debtors. Class 3 is impaired.
Class 4 current provider allowed unsecured claims are also
impaired. Holders of Allowed Unsecured Claims who are also
currently employed by the Debtors as either W-2 or 1099 Independent
Contractors shall be allowed to exchange their Allowed Unsecured
Claims on a dollar-for-dollar basis as Equity in the Reorganized
Debtors. The holders Class 4 claims who do not elect to exchange
their claims for equity shall receive on account of their allowed
claims a distributions from the remaining assets of the Estate,
recoveries from the Litigation Trust and operating profits from the
Reorganized Debtors on the later of: (1) no later than five years
following the Effective Date, or (2) within 10 business days after
such claim becomes an Allowed Claim.
Upon the Effective Date, the Trustee will make all payments
required, using his own discretion as to the use of any and all of
the Debtors' monies including those from operations and
post-confirmation recoveries.
The Chapter 11 trustee can be reached at:
James E. Cross
CROSS LAW FIRM, P.L.C.
7301 N. 16th St., Suite 102
Phoenix, AZ 85020
E-mail: jcross@crosslawaz.com
A copy of the First Amended Disclosure Statement dated October 19,
2022, is available at https://bit.ly/3MTNMpF from
PacerMonitor.com.
About SPG Hospice
Scottsdale Physicians Group, PLC, was founded by Nima Ghadimi in
2003. SPG provides hospitalist staffing services for hospitals, as
well as, physician staffing services to skilled nursing facilities
and other post-acute settings. Its workforce is comprised of
medical providers, mostly paid on a 1099 basis, and disease support
personnel, the vast majority of which are paid on a W-2 basis SPG's
income is generated solely from the fees associated from their
medical professionals
providing services.
Established in 2018, SPG Hospice, LLC, provides hospice services
throughout Arizona but primarily located in the Phoenix
metropolitan area.
Established in 2019, United Telehealth Corp provides advanced
virtual care medical services to patients in their homes throughout
Arizona. UTC combines the remote provider aspect of traditional
telemedicine with an in-person medical technician "Tech" who is
physically present with the patient in their home or facility.
The U.S. Department of Justice claims that prepetition, the Debtors
violated, among other things, the False Claims Act, 31 U.S.C. Sec.
3729-33 (the "FCA"), by virtue of funds that Debtors received on
account of allegedly false claims for payment that the Debtors
allegedly knowingly submitted or caused to be submitted to the
Medicare Program, Title XVIII of the Social Security Act, 42 U.S.C.
Secs. 1395-1395kkk-1
(Medicare), the TRICARE Program, 32 C.F.R Sec. 199 et seq.
(TRICARE).
PG Hospice, LLC, Scottsdale Physicians Group, PLC, and United
Telehealth Corp, sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case Nos. 22-02385, 22-02388 and
22-02409) on April 19, 2022. In the petition signed by Nima
Ghadimi, managing member, the Debtor disclosed up to $50,000 in
assets and up to $500,000 in liabilities.
Judge Eddward P. Ballinger Jr. oversees the case.
Jonathan Philip Ibsen, Esq., at Canterbury Law Group, LLP, is the
Debtor's counsel.
STERICYCLE INC: Egan-Jones Retains B+ Senior Unsecured Ratings
--------------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Stericycle, Inc.
Headquartered in Bannockburn, Illinois, Stericycle, Inc. is a
business-to-business services company.
STERICYCLE INC: Fitch Affirms 'BB' LongTerm IDR, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has affirmed Stericycle, Inc.'s (SRCL) Long-Term
Issuer Default Rating (IDR) at 'BB'. The Rating Outlook is Stable.
Fitch has also affirmed SRCL's senior unsecured notes at
'BB'/'RR4'.
The ratings on SRCL incorporate the company's leading market
position and fundamentally stable demand profile associated with
its waste streams and contracted revenue base. The ratings also
incorporate the limited visibility to FCF generation given the
potential continuation of negative cash impacts associated with ERP
system implementation, legal matters and operational improvements.
Over the next two years, Fitch expects leverage to decline to the
low-3.0x, a level consistent with higher ratings. However, while
Fitch recognizes SRCL's progress on operational and deleveraging
goals, rating progression is dependent on successfully completing
current initiatives and dealing with legal matters in a manner that
de-risk SRCL's FCF profile.
KEY RATING DRIVERS
FCF to Stabilize Barring Further Challenges: Fitch expects positive
FCF of around $90 million in 2022, though near term and one-time
costs (such as the $90 million settlement) are notably reducing
cash flow in the year. Fitch continues to take a somewhat cautious
approach to forecasting FCF, due to the potential for execution
challenges as it rolls out the ERP system across the Regulated
Waste and Compliance Services (RWCS) segment in 2023 and the
seemingly lingering legal issues that have led to large
settlements. SRCL will also need to execute on pricing actions
taken to offset inflation and an inability to execute could be a
FCF drag.
Assuming these challenges settle, Fitch forecasts FCF of around
$200 million over the medium term. While the company has set a
target of $400 million of FCF in the 2024-2025 timeframe, Fitch's
forecast considers the SRCL's historical track record of facing
operational challenges and incurring higher than expected costs.
ERP Implementation Should Support Visibility: Management has
indicated that implementation of the ERP system would allow
additional clarity in operational decision making to further
enhance performance. The ERP system is approaching a key milestone
in 2023 of implementation across the RWCS segment in North America.
However, Fitch believes the rollout carries execution risk with the
chance of increased cost to implement or a longer than expected
timeline. Fitch has currently not assumed challenges lead to
sustainably lower EBITDA margins or FCF generation.
Moderate FCF Earmarked for Debt Repayment: Over the last three
years, capital deployment has been focused on deleveraging,
utilizing effectively all of its FCF and divestiture proceeds.
Fitch expects FCF in 2022 to again be focused on debt repayment,
but subsequently deployment priorities are likely to shift as the
company meets its target leverage profile. Fitch will look for the
company to adopt a clear capital allocation and financial policy as
the FCF profile stabilizes.
Steady Near-Term Leverage: Fitch expects adjusted debt/EBITDAR and
debt/EBITDA to be about 3.4x in 2022, before improving to the low
3.0x in 2023. Modestly weaker profitability in 2022 is offset with
debt repayment. Leverage in the low-3.0x is consistent with higher
ratings and generally consistent with the company's net leverage
target of under 3.0x by 2023. However, SRCL's credit profile
remains constrained by instability in its operating profile.
Waste Streams and Contracts Support Stability: Numerous
divestitures the last couple years including the environmental
solutions and recall businesses are expected to improve the
stability of SRCL. Fundamentally, Fitch believes that the medical
waste business has low sensitivity to business cycles. Similarly,
SID should be fairly stable though less so than medical waste.
Further the company has taken pricing actions such as the recycled
paper surcharge and more recently the service cost recovery fee
that are aimed at mitigating volatility of sorted office paper
prices and inflationary pressures. Stability is also supported by
lengthy contract durations of around three to five years for the
majority of its customers.
Pricing Risk Despite Market Leadership: SRCL's competitive position
is supported by its broad network of complementary services,
regulatory know-how and established reputation. These features
support customer stickiness and in turn earnings stability.
However, despite its leading position, competition is often local,
where small competitors may compete on price. In its past, SRCL has
faced challenges with pricing practices that led to a period of
elevated discounting that largely lasted into 2019.
DERIVATION SUMMARY
Fitch compares SRCL to the large municipal solid waste firms Waste
Management (WM; BBB+), Waste Connections (WCN; BBB+) and Republic
Services (RSG; BBB). Comparably, Fitch views SRCL's business
profile as relatively weaker than these peers due to the
concentration in end markets, higher risk of competitive pressures,
and remaining execution risks. Fitch expects adjusted debt/EBITDAR
and debt/EBITDA in the mid-to-low 3.0x range versus debt/EBTIDA of
about 3.0x for RSG and the mid-to-high 2.0x for WM and WCN. Fitch
also believes SRCL's FCF margin will range in the mid-single digits
over the next couple of years, a similar level to WM and WCN, and
well below WCN's of over 10%.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer
- Total revenue growth in the low-single digits in 2022 with
high-single digit growth in SID from favorable paper prices and
low-single digit organic growth in RWCS. Organic growth remains
sustainably positive around the low-single digits thereafter;
- EBITDA margins modestly tighten in 2022 to slightly below 17%
from 18% in 2021 due pricing lagging cost inflation and higher
operating costs to support the ERP rollout. Subsequently, EBITDA
margins strengthen toward the high-teens, however; remain below
levels implied by SRCL over the 2024-2025 timeframe;
- One-time costs such as transformation-related and legal costs
(i.e. FCPA settlement of $90 million in 2022) continue but at a
notably lower level after 2022;
- In 2022, FCF deployment is focused on debt repayment but may
include minor M&A. SRCL revisits capital deployment priorities once
it reaches target leverage levels;
- SRCL remains dedicated to reaching its net leverage target of
under 3.0x.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
--A reduction in operational and legal challenges lead to EBITDA
margin of approximately 20% and FCF sustained in excess of $200
million;
- Commitment to a financial policy that sustains adjusted
debt/EBITDAR and debt/EBITDA below 4.0x;
- A credit conscious capital allocation plan that retains financial
flexibility.
Fitch is unlikely to upgrade the company without solid progression
in implementing its ERP program, de-risking legal concerns and
achieving operational improvements that lead to sustainable FCF
generation.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Execution or operating challenges arise leading to EBITDA margins
sustained below the mid-teens and/or FCF margin sustained in the
low-single digits or below;
- A change to a more aggressive capital deployment policy that
restricts cash flow;
- Beyond the near term, continued margin pressures or a less
conservative financial policy leads to maintaining adjusted
debt/EBITDAR and debt/EBITDA above 4.5x.
LIQUIDITY AND DEBT STRUCTURE
As of June 30, 2022, SRCL's liquidity was approximately $845
million and consisted of $46 million of cash and $799 million of
availability under its $1.2 billion revolving credit facility,
after considering borrowings and letters of credit. The $600
million of senior unsecured notes due 2024 matures first.
Fitch treats reported lease liabilities as debt reflecting the high
proportion of leased assets utilized in SRCL's service network.
Fitch calculates that lease liabilities are roughly 25% of SRCL's
unadjusted debt balances and would reassess its treatment of leases
if this proportion or lease asset mix significantly
increases/changes.
ISSUER PROFILE
Stericycle is a leading provider of regulated medical waste and
document shredding services. It operates a network of collection,
processing and recycling assets across the U.S. and certain
international regions. It primarily services medical and commercial
end markets.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Recovery Prior
----------- ------ -------- -----
Stericycle, Inc. LT IDR BB Affirmed BB
senior
unsecured LT BB Affirmed RR4 BB
SUMAK KAWSAY: Unsecureds Owed $35K to Get 10% Dividend in Plan
--------------------------------------------------------------
Sumak Kawsay, LLC, filed an Amended Chapter 11 Small Business Plan
and an Amended Small Business Disclosure Statement.
The Debtor plans to fund the settlement agreement and other plan
payments from the funds accumulated on the Debtor's DIP account,
from the date of the petition and from the resumed medallion
operations.
Under the Plan, Class II General Unsecured Claims totaling $35,706.
The Debtor proposes to pay a 10% dividend of their allowed claims
in one lump sum payment commencing on the Effective Date of this
Plan. Class II is impaired.
Attorney for debtor Sumak Kawsay, LLC:
Alla Kachan, Esq.
2799 Coney Island Ave, Suite 202
Brooklyn, NY 11235
Tel: (718) 513-3145
Fax: (347) 342-315
E-mail: alla@kachanlaw.com
A copy of the Disclosure Statement dated Oct. 21, 2022, is
available at https://bit.ly/3VQyXbz from PacerMonitor.com.
About Sumak Kawsay
Sumak Kawsay, LLC, filed a petition for Chapter 11 protection
(Bankr. S.D.N.Y. Case No. 21-11531) on Aug 30, 2021, listing as
much as $500,000 in both assets and liabilities. Victor H. Salazar,
president, signed the petition.
Judge David S. Jones oversees the case.
The Debtor tapped the Law Offices Of Alla Kachan, P.C., as legal
counsel and Wisdom Professional Services Inc. as accountant.
SUMMIT HOTEL: Egan-Jones Retains BB Senior Unsecured Ratings
------------------------------------------------------------
Egan-Jones Ratings Company, on September 21, 2022, retained its
'BB' foreign currency and local currency senior unsecured ratings
on debt issued by Summit Hotel Properties, Inc.
Headquartered in Austin, Texas, Summit Hotel Properties, Inc.
operates as a real estate investment trust.
SUNSTONE HOTEL: Egan-Jones Retains BB- Senior Unsecured Ratings
---------------------------------------------------------------
Egan-Jones Ratings Company, on September 23, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by Sunstone Hotel Investors, Inc.
Headquartered in Irvine, California, Sunstone Hotel Investors, Inc.
operates as a hospitality and lodging real estate investment
trust.
TEGNA INC: Egan-Jones Retains CCC+ Senior Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company, on September 19, 2022, retained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by TEGNA Inc. EJR also retained its 'B' rating on
commercial paper issued by the Company.
Headquartered in Tysons, Virginia, TEGNA Inc. is a broadcasting,
digital media and marketing services company.
TELEPHONE AND DATA: Egan-Jones Keeps B+ Senior Unsecured Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on September 15, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by Telephone and Data Systems, Inc.
Headquartered in Chicago, Illinois, Telephone and Data Systems,
Inc. is a diversified telecommunications company.
TERESITA AVILA ALBA: Int'l. Investments Buying 2 L.A. Properties
----------------------------------------------------------------
Teresita Avila Alba filed a notice with the U.S. Bankruptcy Court
for the Central District of California of proposed sale of the
following real properties to International Investments Trading &
Consulting, Inc. for $1,375,000:
a. located at 1438 Oak Grove Drive, Los Angeles, CA 90041,
APN 5480-027-003; and
b. located at 5050 Shearin Ave., Los Angeles, CA 90041, APN
5686-006-016.
The Debtor owns a total of eight residential income properties.
The two properties she is selling are jointly owned by her and her
son, Victor Franklin Alba. The Properties are in dilapidated
condition and currently subject to the requirements of the Rent
Escrow Account Program ("REAP") of the Los Angeles City Housing
Department, which results in withholding a portion of the rent
generated by the Properties. Consequently, the Properties do not
generate sufficient cash flow to service any commercially available
financing.
The Properties were the subject of state court litigation in the
Los Angeles Superior Court between Debtor and her son, as
plaintiffs, and Alex Pedram Mehdiani and California Prime Realty,
the Defendants1. In the last days before trial, the Debtor and her
son authorized their counsel to settle the litigation.
As stated in the Settlement Agreement, the Properties are subject
to a first-priority lien in favor of Alex Pedram Mehdiani, securing
an obligation in the principal amount of $600,000 plus accrued
interest and attorney fees. The Settlement Agreement requires the
Debtor and her son to exercise one of three options: (a) convey
title to the Properties to Mehdiani; (b) allow Mehdiani to exercise
his rights under the deeds of trust in his favor, including the
power of sale; or (c) pay Mehdiani the sum of $1.2 million.
The fair market value of the Properties is approximately $1.1
million.
The Buyer has made an offer to purchase the Properties. Prior to
the filing of the case, the Debtor executed a contract accepting
the Buyer's offer. By the Motion, she seeks the approval of the
sale of the Properties to the Buyer and for the additional relief.
The principal terms of agreement are:
(1) The purchase price is $1,375,000. The Buyer has waived
all contingencies of sale.
(2) The Properties will be sold "as is, where is" with no
warranties or representations
of any kind whatsoever.
(3) Undisputed liens (the Mehdiani deed of trust and property
taxes) will be released upon payment of $1.2 million to Mehdiani
through escrow and payment of the property taxes.
(4) Broker fees will be paid through escrow.
(5) Although not specified in the Settlement Agreement, the
Debtor and her son haveagreed that any remaining sale proceeds will
be placed in the Debtor's DIP account.
(6) Escrow is to close by Oct. 31, 2022.
The Debtor believes that the Court may require an opportunity for
overbidding prior to the approval of the proposed sale. As a
result, she proposes the following overbidding procedures:
(1) The overbid must be all cash and must be at least
$1,425,000 ($50,000 greater than the current offer), with no
contingencies to closing whatsoever.
(2) Any party who would like to bid on the Properties during
the hearing on the Motion must contact the Debtor's counsel at
least 24 hours prior to the hearing and provide evidence of
financial resources to the Debtor's reasonable satisfaction. The
Debtor's counsel will provide an information packet to any party
who would like to bid on the Properties. Any overbidder must also
submit, before the time of the hearing, a deposit for the purchase
of the Properties in the amount of at least $500,000.
(3) Overbid increments will be $25,000 after the initial
overbid.
Authorizing sale of the Properties allow the Debtor to implement
the terms of a prepetition settlement agreement she executed. That
settlement agreement requires her to make a payment of $1.2 million
to secured creditor Mehdiani who holds first-priority liens on the
Oak Property and the Shearin Property. Proceeds of the property
sale will provide those funds. Failure to perform the settlement
agreement would result in the Debtor's loss of the property without
any benefit to the estate.
The settlement agreement concluded long-standing litigation with
secured creditor Mehdiani to which the Debtor and her son were
parties. The settlement benefits the estate by reducing the
Debtor's legal expense, by avoiding the uncertainty of a jury
trial, and by avoiding an arduous physical and emotional burden on
her, who is 82 years old breast cancer survivor who also suffers
from a variety of medical conditions, all of which impinge on her
ability to undergo the rigors of a multi-day trial.
The settlement is in the best interest of the estate, as it allows
the Debtor to recover some equity in the Oak Property and Shearin
Property, both of which are in the REAP program of the Los Angeles
City Housing Department. Retaining ownership of the two properties
would have obligated the Debtor to fund and undertake substantial
rehabilitation of each property, a task for which she is not
well-suited given her present health and financial condition.
The additional relief sought in the Motion is as follows:
(a) Approving the sale of the Oak Property and the Shearin
Property in time to allow a closing of the sale escrow by October
31, authorizing the Debtor to execute any and all documents
necessary or convenient to allow the sale to close, and requiring
that
Debtor deposit the net sale proceeds into her DIP account.
(b) Approving the prepetition settlement agreement which the
Debtor and her son executed on Oct. 1, 2022, thereby allowing the
estate to benefit from the sale of the properties.
(c) Authorizing payment of $1.2 million to Alex Pedram
Mehdiani, the secured creditor, as required by the terms of the
settlement agreement.
(d) Waiving the 14-day waiting period provided in Bankruptcy
Rule 6004-1.
The Debtor respectfully requests that the Court enters an order
granting the Motion in its entirety; authorizing and approving the
sale of the Properties to the Buyer, free and clear of all liens,
claims, and interests; authorizing the payment (i) of the
commissions described in the Memorandum of Points and Authorities
at the close of escrow, (ii) of any undisputed liens, claims and
interests on and against the Properties, if any, (iii) of real
property taxes, plus interest, owed on the Properties and all usual
and customary escrow and closing and recording costs generally
attributable to a seller of real property, if any, at the close of
escrow; and (iv) authorizing the Debtor to hold that portion of the
sale proceeds attributable to disputed claims of exemption, liens
and encumbrances, pending further orders of the Court.
A copy of the Agreement is available at
https://tinyurl.com/2fsnm3yc from PacerMonitor.com free of charge.
The bankruptcy case is In re: Teresita Avila Alba Case No.:
1:22-bk-11183-VK (Bankr. C.D. Cal.).
TERESITA AVILA ALBA: Selling Two Los Angeles Properties for $1.4MM
------------------------------------------------------------------
Teresita Avila Alba asks the U.S. Bankruptcy Court for the Central
District of California to authorize the sale of the following real
properties to International Investments Trading & Consulting, Inc.,
for $1,375,000:
a. located at 1438 Oak Grove Drive, Los Angeles, CA 90041,
APN 5480-027-003; and
b. located at 5050 Shearin Ave., Los Angeles, CA 90041, APN
5686-006-016.
The Buyer has made an offer to purchase the Properties. Prior to
the filing of the case, the Debtor executed a contract accepting
the Buyer's offer. By the Motion, she seeks the approval of the
sale of the Properties to the Buyer and for the additional relief.
Authorizing sale of the Properties allow the Debtor to implement
the terms of a prepetition settlement agreement she executed. That
settlement agreement requires her to make a payment of $1.2 million
to secured creditor Mehdiani who holds first-priority liens on the
Oak Property and the Shearin Property. Proceeds of the property
sale will provide those funds. Failure to perform the settlement
agreement would result in the Debtor's loss of the property without
any benefit to the estate.
The settlement agreement concluded long-standing litigation with
secured creditor Mehdiani to which the Debtor and her son were
parties. The settlement benefits the estate by reducing the
Debtor's legal expense, by avoiding the uncertainty of a jury
trial, and by avoiding an arduous physical and emotional burden on
her, who is 82 years old breast cancer survivor who also suffers
from a variety of medical conditions, all of which impinge on her
ability to undergo the rigors of a multi-day trial.
The settlement is in the best interest of the estate, as it allows
the Debtor to recover some equity in the Oak Property and Shearin
Property, both of which are in the REAP program of the Los Angeles
City Housing Department. Retaining ownership of the two properties
would have obligated the Debtor to fund and undertake substantial
rehabilitation of each property, a task for which she is not
well-suited given her present health and financial condition.
The additional relief sought in the Motion is as follows:
(a) Approving the sale of the Oak Property and the Shearin
Property in time to allow a closing of the sale escrow by October
31, authorizing the Debtor to execute any and all documents
necessary or convenient to allow the sale to close, and requiring
that
Debtor deposit the net sale proceeds into her DIP account.
(b) Approving the prepetition settlement agreement which the
Debtor and her son executed on Oct. 1, 2022, thereby allowing the
estate to benefit from the sale of the properties.
(c) Authorizing payment of $1.2 million to Alex Pedram
Mehdiani, the secured creditor, as required by the terms of the
settlement agreement.
(d) Waiving the 14-day waiting period provided in Bankruptcy
Rule 6004-1.
The Debtor respectfully requests that the Court enters an order
granting the Motion in its entirety; authorizing and approving the
sale of the Properties to the Buyer, free and clear of all liens,
claims, and interests; authorizing the payment (i) of the
commissions described in the Memorandum of Points and Authorities
at the close of escrow, (ii) of any undisputed liens, claims and
interests on and against the Properties, if any, (iii) of real
property taxes, plus interest, owed on the Properties and all usual
and customary escrow and closing and recording costs generally
attributable to a seller of real property, if any, at the close of
escrow; and (iv) authorizing the Debtor to hold that portion of the
sale proceeds attributable to disputed claims of exemption, liens
and encumbrances, pending further orders of the Court.
A copy of the Agreement is available at
https://tinyurl.com/2u64uv7n from PacerMonitor.com free of charge.
The bankruptcy case is In re: Teresita Avila Alba Case No.:
1:22-bk-11183-VK (Bankr. C.D. Cal.).
TEXAS MARINE: Unsecureds Will Get 100% of Claims over 5 Years
-------------------------------------------------------------
Texas Marine Supplies, LLC, filed with the U.S. Bankruptcy Court
for the Southern District of Texas a Plan of Reorganization dated
October 24, 2022.
Texas Marine Supplies, LLC ("TMS") was created in 2008. The Debtor
is a maritime shipping supplies and procurement business.
The Debtor is a maritime shipping supplies and procurement
business. TMS was forced to file bankruptcy due to its inability to
make the requisite daily payments of several high-interest loans
and the aggressive collection efforts of merchant cash advance
companies. The Debtor filed this case on July 25, 2022, to seek
protection from aggressive collection efforts by creditors that, if
continued, would be to the detriment of other creditors.
Debtor proposes to pay allowed unsecured based on the liquidation
analysis and cash available. Debtor anticipates having enough
revenue to fund the plan and pay the creditors pursuant to the
proposed plan. It is anticipated that after confirmation, the
Debtor will continue in business. Based upon the projections, the
Debtor believes it can service the debt to the creditors.
The Debtor will continue operating its business. The Debtor 's Plan
will break the existing claims into five classes of claims. These
claimants will receive cash repayments over a period of time
beginning on the Effective Date.
Class 3 consists of the Disputed Claim of LG Funding, LLC. This
claim is impaired. LG Funding, LLC (Claim No. 2) filed a secured
claim in the amount of $212,242.50. The Debtor listed LG Funding,
LLC as a disputed claim on its schedules. LG Funding, LLC asserts
that it is fully secured by all of debtor's personal property
including its accounts receivable. The claim also includes
exorbitant attorney's fees. Debtor's Objection to the Proof of
Claim of LG Funding is pending before the Court. The Debtor
proposes to set aside $3,537.37 per month to account for potential
payment of LG's claim as an unsecured claim, should the Court allow
the claim in its entirety. If the Court sustains Debtor's objection
to LG's proof of claim and denies the portion of the claim
designated as attorney's fees in the amount of $42,848.51 and the
$5,000.00 default fee, LG will solely be entitled to $166,393.99 as
a general unsecured claim under the Plan. The monthly payment would
be $2,773.23.
Class 4 consists of General Unsecured Claims. These claims are
impaired. All allowed unsecured creditors shall receive 100% of
their allowed unsecured claim at zero percent per annum, paid in
monthly installments, over the next 5 years beginning no later than
the 15th day of the first full calendar month following 30 days
after the effective date of the plan and continuing every year
thereafter for 4 years.
* 4-1 American Express (Claim No. 1) filed an unsecured claim
in the amount of $9,118.86. The Debtor will pay the full amount of
the claim at zero percent interest per annum over the next five
years with the first monthly payment being due and payable on the
15th day of the first full calendar month following the Effective
Date, unless this date falls on a weekend or federal holiday, in
which case the payment will be due on the next business day. The
monthly payment will be $151.98.
Class 5 Equity Interest Holders are not impaired under the Plan.
The current owners will receive no payments under the Plan;
however, they will be allowed to retain their ownership in the
Debtor. Class 5 Claimants are not impaired under the Plan.
Debtor anticipates the continued operations of the business to fund
the Plan.
A full-text copy of the Plan of Reorganization dated October 24,
2022, is available at https://bit.ly/3ffRL3D from PacerMonitor.com
at no charge.
About Texas Marine Supplies
Texas Marine Supplies, LLC sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 22-32055) on
July 25, 2022. In the petition signed by Gilberto Sanchez Zamora,
director, the Debtor disclosed up to $500,000 in both assets and
liabilities.
Judge Jeffrey P. Norman oversees the case.
Robert C Lane, Esq., at The Lane Law Firm, is the Debtor's counsel.
TITLE PIPE: Unsecureds Will Get 6% of Claims over 60 Months
-----------------------------------------------------------
Title Pipe, Inc., filed with the U.S. Bankruptcy Court for the
District of Idaho a Subchapter V Plan of Reorganization dated Oct.
24, 2022.
Title Pipe was formed as a Delaware C-Corp in 2018 after years of
industry experience led its founder to move forward with his dream
to create a solution to help participants involved in real estate
transactions. Approximate ownership as of the date of the petition
filing was therefore: Mark Rodeghiero 94%, Burnett 4%, Leatherman
1%; Johnson 1%.
Ventive and Title Pipe contracted in December 2018 to have Ventive
develop the online application with the intent of launching in Q2
of 2019 after extensive discussions regarding the functionality
needs of the software. After paying over $1,000,000, Title Pipe
unsuccessfully attempted to negotiate terms with Ventive for
payment of the remaining balance. Ventive sued for the remainder.
Around that same time, Title Pipe discovered what it believed to be
a pattern of fraud by Ventive. Title Pipe was then embroiled in
litigation until Spring 2022 when the arbitrator ruled that Title
Pipe should pay Ventive the balance due with interest.
The overwhelming costs and time for legal action coupled with the
expenses and ramifications associated with the software being
market-ready came to a head in the 2nd quarter of 2022. Investor
prospects disappeared with the impending arbitration and potential
award. Once the arbitration was decided against Title Pipe, its
debts became unsustainable. Title Pipe's experience with and
knowledge of Ventive left Title Pipe with the conclusion that
bankruptcy protection was the only hope Title Pipe had to protect
Title Pipe's IP that Title Pipe was awarded in arbitration.
Business operation expenses over the past months have been scaled
back substantially and are currently at approximately $6k/month.
Title Pipe is finalizing options and feature rework to enable
subscription-based billing and have established a margin revenue
model for the associations allowing Title Pipe to utilize them as
sales, training and marketing channels to their users. Now that the
product is market-ready, the team believes that given a chance to
develop the relationship with its potential clients (many of whom
have indicated interest), Title Pipe will experience the success
necessary to pay creditors.
Class 1 consists of General Unsecured Claims. The Debtor intends to
pay $195,000.00 into the Plan over a period of 60 months. The
Debtor shall make equal payments of $4062.50 to all
non-administrative Creditors in months 13-60 of the plan. After
payment of administrative claims and priority claims pursuant to
Classes the general unsecured claims in this class shall receive
approximately $195,000 paid in equal installments in months 13-16.
Debtor scheduled $2,946,643.28 in general unsecured debt. It is
anticipated that this class shall receive approximately 6% of their
respective claims.
Debtor shall make payments from future income of the debtor and or
future capital investment. Debtor does not intend to liquidate any
assets. The Debtor's financial projections show that the Debtor
will have an aggregate annual average cash flow, after paying
operating expenses and post- confirmation taxes, of $24,000. The
final Plan payment is expected to be paid on December 31st 2027.
A full-text copy of the Subchapter V Plan dated October 24, 2022,
is available at https://bit.ly/3sJg25k from PacerMonitor.com at no
charge.
Attorney for Debtor:
Patrick J. Geile, Esq.
Foley Freeman, PLLC
953 S. Industry Way
P.O. Box 10
Meridian, ID 83680
Phone: (208) 888-9111
Fax: (208) 888-5130
Email: pgeile@foleyfreeman.com
About Title Pipe
Title Pipe, Inc. -- https://www.titlepipe.com/ -- is a software
company in Eagle, Idaho, which offers computer systems design and
related services.
Title Pipe filed a voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. D. Idaho Case No. 22-00328) on July
26, 2022. The Debtor has elected to proceed under Subchapter V of
Chapter 11.
In the petition filed by its chief executive officer, Mark A.
Rodeghiero, the Debtor listed assets between $100,000 and
$500,000and liabilities between $1 million and $10 million.
Judge Joseph M. Meier oversees the case.
Patrick John Geile, Esq., at Foley Freeman, PLLC and Cheryl Guiddy,
CPA serve as the Debtor's legal counsel and accountant,
respectively.
TOSCANA LUNA: Property Sale Expected to Pay Claims in Full
----------------------------------------------------------
Toscana Luna, LLC, submitted an Amended Disclosure Statement as of
October 21, 2022.
The Plan will be funded through the sale of the property at 505
Frisco Avenue, Metairie, Louisiana. In the alternative, the
property will be sold or refinanced through a combination of a loan
from NOLA Funding, LLC2 and Stirling Holdings, LLC.
The Debtor is unaware of any unsecured creditors at this time. Any
allowed unsecured creditors will receive a pro-rata share of their
claim up to the full amount of the Debtor's liquidation value, over
a period no longer than 60 months from the Effective Date.
Under the Plan, Class 1 Secured Claim of Vanessa Miranda in the
approximate amount of $408,980. The Class 1 claim is secured by a
first-ranking mortgage upon the Debtor's property, 505 Frisco
Avenue, Metairie, Louisiana. The claim shall be paid in full on
the Effective Date. Miranda shall retain the mortgage on Debtor's
property until the claim is paid in full. Class 1 is unimpaired.
Class 2 Secured Claim of Vanessa Miranda in the amount of $879,500
is unimpaired and not entitled to vote. The Class 2 claim is
secured by a second-ranking mortgage upon the Debtor's property,
505 Frisco Avenue, Metairie, Louisiana 70005. The amount of the
claim is disputed and the Debtor is objecting to Claim No. 1 filed
by Miranda. The Debtor will pay the full amount of the allowed
Class 2 claim on the Effective Date. Miranda shall retain the
mortgage on the Debtor's property until the allowed secured claim
is paid in full.
The Debtor believes that the Plan is feasible as the purchase price
is sufficient to pay all claims in full. Should the Debtor
refinance its property, the Debtor receives rental income from its
tenant, Nor-Joe Imports, LLC, which monthly amount will increase to
an amount sufficient to service the refinanced debt. The Debtor
will amend its lease agreement with Nor-Joe Imports, LLC, to
include the increase in the monthly rental rate.
Attorneys for the Debtor:
Patrick S. Garrity, Esq.
David M. Serio, Esq.
THE DERBES LAW FIRM, L.L.C.
3027 Ridgelake Drive
Metairie, LA 70002
Tel: (504) 837-1230
E-mail: pgarrity@derbeslaw.com
dserio@derbeslaw.com
A copy of the Amended Disclosure Statement dated Oct. 21, 2022, is
available at https://bit.ly/3Dp0byO from PacerMonitor.com.
About Toscana Luna
Toscana Luna, LLC, a company in Metairie, La., sought protection
under Chapter 11 of the Bankruptcy Code (Bankr. E.D. La. Case No.
22-10328) on March 29, 2022, listing as much as $10 million in both
assets and liabilities.
Judge Meredith S. Grabill oversees the case.
The Derbes Law Firm, LLC, led by Patrick S. Garrity, Esq., is the
Debtor's legal counsel.
TPC GROUP: Explosion Case Supplier Objects to Chapter 11 Plan
-------------------------------------------------------------
Nalco Company LLC, a chemical supplier for debtor TPC Group Inc.,
objects to the company's proposed Chapter 11 plan, saying it
doesn't provide for the preservation of corporate records that are
critical to supplier's defense in the multidistrict litigation over
an explosion at one of TPC's Texas plant.
On Sept. 20, 2022, the Debtors filed the Second Amended Joint
Chapter 11 Plan and the Second Amended Disclosure Statement.
Presently the Debtors are soliciting votes on the Plan and have
tentatively set confirmation for a hearing the week of November 7,
2022.
While the Debtors' Plan has made strides since its first iteration,
Nalco says there remain several infirmities with the proposed Plan
that must be addressed prior to confirmation.
Nalco asserts that two key issues remain:
* First, the Plan lacks adequate means of implementation and
runs afoul of section 554(a) and applicable non-bankruptcy law with
respect to certain post-confirmation obligations of the Debtors,
namely their participation in the ongoing MDL Cases in Texas.
Among ongoing duties that should not, and cannot be discharged, are
the Debtors' duties to preserve and retain documents and
participate in discovery in the MDL Cases, to the extent that such
discovery is needed by third parties, such as Nalco, to properly
defend and prosecute their own cases. But the Plan is vague on
this point, and until the Plan is corrected to make clear that the
Debtors have ongoing duties and obligations with respect to
discovery and participation in the MDL Cases, regardless of their
discharge of other liabilities, the Plan should not be confirmed.
Failure to address this issue would cause grave prejudice to the
remaining defendants in the MDL Cases.
* Second, the scope of third-party releases fails as a matter of
well-established Third Circuit law. Third-party, non-consensual
releases are permissible only in a narrow subset of cases where
"adequate consideration" has been given and the releases are both
"fair" and "necessary to the reorganization." The Debtors and the
released third-parties fall far short of meeting this exacting
standard because no economic contribution has been made to the
reorganization by the beneficiaries of the third-party releases.
As a matter of law, these releases should be stricken from the plan
altogether, but at a minimum the releases should not be binding
upon Nalco and its related parties.
Nalco requests that the Court deny confirmation of the Plan until
(i) provisions for the Debtors' post-confirmation participation in
the MDL Cases, including the Debtors' obligations with respect to
written, document, and deposition discovery, are clarified to the
satisfaction of Nalco, (ii) provisions for the Debtors'
preservation of documents and records related to the MDL Cases are
clarified to the satisfaction of Nalco, and (iii) the third-party
releases are stricken.
MDL Cases
On Nov. 27, 2019, the South Unit of the Debtors' butadiene plant in
Port Neches, Texas (the "Port Neches Facility") erupted in a series
of explosions that allegedly affected individuals and property
surrounding the plant (the "PNO Incident").
As a result of the PNO Incident, thousands of lawsuits were filed
in Texas state court against the Debtors, their affiliates, and
other third-party non-debtors. Claims stemming from the PNO
Incident were consolidated before the Texas state court
multi-district litigation docket under the caption In re TPC Group
Litigation, Case No. A2020-0236-MDL (the "MDL Cases"). The MDL
Plaintiffs' claims against TPC and other co-defendants, including
Nalco, include causes of action for negligence, gross negligence,
trespass, and nuisance.
Nalco, a third-party chemical supply and service vendor of the
Debtors, never operated, managed, or made decisions for the Debtors
on any issues of plant maintenance and operations. Likewise, Nalco
had no involvement with operations issues at the Port Neches
Facility. To the contrary, the Debtors retained full operational
and decision-making control over the Port Neches Facility. As
such, Nalco denies that it bears any responsibility for the PNO
Incident, as the PNO Incident was caused solely by the Debtors'
poor facility maintenance and operational decisions.
Importantly, due to the Chapter 11 Cases, the parties in the MDL
Cases have only engaged in limited discovery. On May 10, 2022,
Nalco served TPC's counsel with a set of requests for production,
but TPC filed Chapter 11 Cases before responding to them.
Likewise, the Debtors' insurers have also refused to produce
discovery citing TPC bankruptcy filings and imposition of the
automatic stay
Nalco has sought to ensure a level playing field in the MDL Cases
so that Nalco will not be unfairly forced to litigate without
access to exculpatory evidence. Critically important at this stage
in the Chapter 11 Cases is that (i) the Debtors retain books and
records relevant to the MDL Cases, (ii) the Debtors cooperate and
participate in discovery in the MDL Cases post-confirmation, and
(iii) the Debtors do not abusively hand out gratuitous third-party
releases to its friends. With respect to the Debtors' retention of
records, and cooperation and participation in discovery, under
Texas's joint and several liability construct, one of Nalco's key
defenses is proving that it is less than 50% at fault. Without the
Debtors' ongoing cooperation and obligation to participate in
discovery, Nalco will be severely prejudiced, as the Debtors -- the
only party with operational and decision-making control over the
Port Neches Facility -- are uniquely situated to provide answers as
to what happened and who is at fault with respect to the PNO
Incident.
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.
TRANSOCEAN INC: Moody's Ups CFR to Caa1 & Alters Outlook to Stable
------------------------------------------------------------------
Moody's Investors Service upgraded Transocean Inc.'s Corporate
Family Rating to Caa1 from Caa3, its Probability of Default Rating
to Caa2-PD from Caa3-PD and changed its outlook to stable from
negative. Transocean's Speculative Grade Liquidity (SGL) rating
remains unchanged at SGL-3.
"Sustained improvement in offshore drilling fundamentals has
improved Transocean's cash flow outlook and Moody's view on the
overall recovery of its debt, supporting the ratings upgrade,"
commented Sreedhar Kona, Moody's senior analyst. "The company has
adequate liquidity to manage through its near-term maturities and
Transocean's rising contract backlog and improving credit metrics
also contribute to its stable outlook."
RATINGS RATIONALE
Transocean's upgrade to Caa1 CFR and Caa2 PDR reflects sustained
oil price strength that has improved offshore fundamentals and
higher utilization of equipment leading to higher day rates for
offshore drilling rigs, improving the company's cash flow and
reducing its default risk. The company has sufficient liquidity to
meet its near-term debt maturity obligations. Additionally, its
improving backlog and materially higher day rates imply an
increasing rig fleet value and overall recovery on the company's
debt. These fundamental improvements and rising interest coverage
support the change in the outlook to stable.
Transocean's Caa1 CFR reflects the company's high debt leverage,
and Moody's view on overall recovery on the company's debt.
Although Transocean's credit metrics are improving, they still
remain weak, making the company highly reliant on continued
strengthening of offshore drilling fundamentals for its capital
structure to become sustainable. The company's high debt levels and
complex capital structure raise the risk for future transactions
that could be viewed as distressed exchanges, particularly if
industry fundamentals or investor sentiment changes, which is
reflected in the Caa2 PDR.
Transocean benefits from its revenue backlog of over $7.3 billion
and the company's measures to maintain high levels of revenue
efficiency, reduce operating costs, and enhance operational
utilization of its active rigs. The company has alleviated some
pressure on its liquidity by entering into credit agreements with
the shipyard to finance all or a portion of the final payments
expected to be owed upon the delivery of its two rigs, Deepwater
Atlas and Deepwater Titan. While these financing arrangements
enhance the company's liquidity, they also increase the company's
debt burden. Transocean has adequate liquidity to satisfy its
near-term maturities, but the company has substantial refinancing
risk for the maturities beyond 2024.
Moody's expects Transocean to maintain adequate liquidity as
reflected in its SGL-3 rating because of its still sizable cash
balance and borrowing availability under its committed credit
facility. As of June 30, 2022, the company had $729 million of cash
and full availability under its $1.33 billion senior secured
revolving credit facility maturing in June 2023. In July 2022, the
credit agreement was amended to reduce the revolver commitment size
to $774 million, with $600 million of the $774 million revolver
commitment maturity extended to June 2025, while the commitment for
the remaining $174 million expires in June 2023. Moody's expects
Transocean to meet its cash needs through 2023 from its operating
cash, cash on hand and revolver borrowings. The credit agreement
contains several financial covenants including maximum debt to
capitalization ratio of 0.60:1.00, minimum liquidity of $500
million, minimum guarantee coverage ratio of 3.00x and minimum
collateral coverage ratio of 2.1x. Moody's expects that the company
will remain in compliance with its covenant requirements although
cushion for compliance will remain tight. Transocean has
approximately $300 million of secured and unsecured notes due in
2023 and approximately $ 900 million due in 2024.
The B1 rating on Transocean's revolving credit facility reflects
its superior position in Transocean's capital structure relative to
the guaranteed unsecured notes and the unsecured notes, given its
security interest in some of Transocean's rigs and strong
collateral cushion in the form of a 2.1x collateral coverage ratio
covenant requirement.
The Guardian Notes, the Pontus Notes, the Poseidon Notes and the
Sentry Notes are rated B2, two notches above the Caa1 CFR and one
notch below the revolver's B1 rating. The B2 rating reflects these
Notes' respective security interest in only one or two rigs and the
cash flow generated from their drilling contracts, and the
potential for any residual claims from these Notes to become
subordinated to secured claims at Transocean, which has provided
unsecured guarantee to these notes.
The Caa1 rating on the SPGNs is the same as the Caa1 CFR,
reflecting these notes' position in Transocean's complex capital
structure and Moody's view on recovery. The SPGNs are subordinated
to the outstanding secured debt and the company's undrawn $774
million secured revolving credit facility. The SPGNs are senior to
the previously issued PGNs and the senior unsecured notes. They
have a priority claim because of the guarantees from Transocean's
structurally senior guarantors, effectively giving these notes a
priority claim to the assets held by Transocean's operating and
other subsidiaries compared to Transocean's PGNs and senior
unsecured notes.
The Caa3 rating on PGNs is two notches below the Caa1 CFR,
reflecting the secured debt, Senior Guaranteed notes (unrated) and
Senior Guaranteed Exchangeable bonds (unrated), to which the PGNs
are subordinated. The PGNs are senior to the unsecured notes and
have a priority claim, because of the guarantees from Transocean's
intermediate holding company subsidiaries, effectively giving these
notes a priority claim over the unsecured notes to the assets held
by Transocean's operating and other subsidiaries.
Transocean's remaining senior unsecured notes are rated Ca,
reflecting their lack of security or subsidiary guarantees leaving
them at the bottom of the capital structure in terms of priority.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
An upgrade of Transocean's ratings would require the continued
improvement in offshore fundamentals leading to substantially
higher EBITDA, improved liquidity, reduced leverage and refinancing
risk. Interest coverage above 2x could be supportive of an
upgrade.
Transocean's ratings could be downgraded if the company's interest
coverage drops below 1x or if commodity prices weaken significantly
resulting in a deterioration in offshore drilling fundamentals.
Ratings could be downgraded if Moody's view on the company's
overall debt recovery or specific debt instrument recovery is
reduced.
Transocean Inc. is a wholly-owned subsidiary of Transocean Ltd., a
leading international offshore drilling contractor operating in
every major offshore producing basin around the world.
The principal methodology used in these ratings was Oilfield
Services published in August 2021.
Upgrades:
Issuer: Transocean Inc.
Corporate Family Rating, Upgraded to Caa1 from Caa3
Probability of Default Rating, Upgraded to Caa2-PD from Caa3-PD
Senior Secured Revolving Credit Facility, Upgraded to B1 (LGD1)
from B3 (LGD2)
Senior Unsecured Notes, Upgraded to Ca (LGD5) from C (LGD6)
Gtd Senior Unsecured Notes, Upgraded to Caa3 (LGD4) from Ca
(LGD5)
Gtd Senior Unsecured Notes, Upgraded to Caa1 (LGD3) from Caa3
(LGD5)
Issuer: Transocean Pontus Limited
Gtd Senior Secured Notes, Upgraded to B2 (LGD2) from Caa1 (LGD2)
Issuer: Transocean Poseidon Limited
Gtd Senior Secured Notes, Upgraded to B2 (LGD2) from Caa1 (LGD2)
Issuer: Transocean Sentry Limited
Gtd Senior Secured Notes, Upgraded to B2 (LGD2) from Caa1 (LGD2)
Issuer: Transocean Guardian Limited
Gtd Senior Secured Notes, Upgraded to B2 (LGD2) from Caa1 (LGD2)
Outlook Actions:
Issuer: Transocean Guardian Limited
Outlook, Changed To Stable From Negative
Issuer: Transocean Inc.
Outlook, Changed To Stable From Negative
Issuer: Transocean Pontus Limited
Outlook, Changed To Stable From Negative
Issuer: Transocean Poseidon Limited
Outlook, Changed To Stable From Negative
Issuer: Transocean Sentry Limited
Outlook, Changed To Stable From Negative
TRANSPORTATION DEMAND: Says Agreement Reached With Parkview
-----------------------------------------------------------
At a hearing Sept. 14, 2022, debtors Transportation Demand
Management, LLC, et al., and Parkview Capital Credit Inc. reached
an in-court settlement which settlement includes authority for
Parkview to, in addition to and contemporaneously with the Debtor,
(1) file a combined disclosure statement and plan of reorganization
and submit the same for conditional approval of the disclosure
statement solely as to adequacy of disclosure and (2) set a single
hearing for final approval of the disclosure statement and
confirmation of the plan.
On Oct. 6, 2022, the Debtors filed their First Combined Amended
Disclosure Statement and Chapter 11 Plan of Reorganization.
The Debtors and Parkview have reached an agreement in principle
since filing their First Combined Amended Disclosure Statement and
Chapter 11 Plan of Reorganization, and the Debtors require
additional time to file an amended proposed disclosure statement
and chapter 11 plan that reflects the terms of the agreement.
At the behest of the Debtors, Judge Marc Barreca entered an order
granting the Debtors until Nov. 3, 2022, to file a Second Combined
Amended Disclosure Statement and Chapter 11 Plan of
Reorganization.
On or before Nov. 3, 2022, the Debtors must file: an (a) ex parte
motion seeking (i) conditional approval of their disclosure
statement; (ii) approval of a proposed form of ballot; (iii)
approval of a proposed form of combined notice of final hearing on
the disclosure statement and confirmation hearing; and (iv) setting
a confirmation hearing and related deadlines; and (b) a form of
received unsigned order granting such relief.
About Transportation Demand Management
Transportation Demand Management, LLC, is a motorcoach and minibus
operator in the Pacific Northwest with a fleet of over 90
motorcoaches and mini buses of varying size generating more than
$15M in annual sales.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Wash. Case No. 22-10482-MLB) on March
26, 2022. In the petition signed by Gladys Gillis, chief executive
officer, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Marc Barreca oversees the case.
Nathan T. Riordan, Esq., at Wenokur Riordan PLLC, is the Debtor's
counsel.
TUPPERWARE BRANDS: Egan-Jones Keeps BB- Senior Unsecured Ratings
----------------------------------------------------------------
Egan-Jones Ratings Company, on September 12, 2022, retained its
'BB-' local currency senior unsecured ratings on debt issued by
Tupperware Brands Corporation.
Headquartered in Orlando, Florida, Tupperware Brands Corporation
provides houseware products.
UNITED AIRLINES: Egan-Jones Keeps B+ Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company, on September 12, 2022, retained its
'B+' foreign currency and local currency senior unsecured ratings
on debt issued by United Airlines, Inc. EJR also retained its 'B'
rating on commercial paper issued by the Company.
Headquartered in Chicago, Illinois, United Airlines, Inc. provides
commercial airline services.
UNITIKA LTD: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
-----------------------------------------------------------
Egan-Jones Ratings Company, on September 12, 2022, retained its
'CCC+' foreign currency senior unsecured ratings on debt issued by
UNITIKA LTD. EJR also retained its 'C' rating on commercial paper
issued by the Company.
Headquartered in Osaka, Osaka, Japan, UNITIKA LTD manufactures and
sells synthetic fibers and textile products used as apparel and
industrial materials.
VAIL RESORTS: Moody's Ups CFR to Ba2 & Sr. Unsecured Notes to Ba3
-----------------------------------------------------------------
Moody's Investors Service upgraded Vail Resorts, Inc.'s Corporate
Family Rating to Ba2 from Ba3 and Probability of Default Rating to
Ba2-PD from Ba3-PD. Concurrently Moody's upgraded the rating for
the company's existing $600 million senior unsecured notes due 2025
to Ba3 from B1. Moody's took no action on the Speculative Grade
Liquidity rating of SGL-1. The outlook remains stable.
The CFR upgrade to Ba2 reflects Moody's expectation for solid
operating performance over the next year following a very strong
2021/2022 ski season that demonstrated healthy consumer demand and
good operating execution. Total revenue and earnings both surpassed
pre-coronavirus levels as the result of strong ski volume and yield
management through dynamic pricing, cost discipline, and continued
investment in transformational upgrades. Moody's adjusted gross
debt-to-EBITDA leverage declined to about 3.4x for the LTM period
ended July 2022 and Moody's expects gross leverage will remain in
the mid 3x range by the end of fiscal year ending in July 2023 due
to stable demand with some cost pressures for labor and to improve
service quality and customer amenities. The Epic season pass is
contributing to good skier loyalty, improved demand visibility, and
moderating the cash flow seasonality. Advance Epic pass sales
indicate good demand for the upcoming 2022/2023 ski season with
both higher volume and pricing. Moody's believes it is less likely
that Vail will repay the debt issued during the pandemic to bolster
cash and liquidity. The company will instead likely utilize the
cash for growth investments such as tuck-in acquisitions completed
in FY22 and FY23. Moody's projects Vail will generate comfortably
positive free cash flow over the next year despite increased
capital spending to fund infrastructure improvements and amenities
that enhance service levels. This should enable the company to
maintain gross debt-to-EBITDA leverage below 4x over the next few
years even if an economic slowdown or poor weather negatively
affects a particular ski season.
Additionally, the upgrade of CFR reflects that the company's very
good liquidity (SGL-1) over the next year provides considerable
financial flexibility to manage periods of lower earnings.
Liquidity is supported by about $1.1 billion of cash on balance
sheet as of July 31, 2022 and approximately $637 million of
combined unused capacity on its subsidiaries' revolver credit
facilities (U.S. and Whistler Blackcomb revolving credit
facilities) that expire in 2026. After capital spending and
dividends, Moody's expects the company will be able to generate
free cash flow in excess of $150 million over the next year.
Moody's took the following actions:
Issuer: Vail Resorts, Inc.
Upgrades:
LT Corporate Family Rating, upgraded to Ba2 from Ba3
Probability of Default Rating, upgraded to Ba2-PD from Ba3-PD
Senior Unsecured notes, upgraded to Ba3 (LGD5) from B1 (LGD5)
Outlook Actions:
Issuer: Vail Resorts, Inc.
Outlook, Remains Stable
RATINGS RATIONALE
Vail's Ba2 CFR reflects its moderate financial leverage with
Moody's adjusted gross debt-to-EBITDA of about 3.4x for the fiscal
year ended July 31, 2022. Moody's expects gross debt-to-EBITDA
leverage will remain in the mid 3x range over the next year due to
stable demand with some cost pressures for labor and to improve
service quality and customer amenities weakening the EBITDA margin.
In addition, the rating is constrained by operating results that
are highly seasonal and exposed to varying weather conditions and
discretionary consumer spending. Vail's resort revenue and EBITDA
declined roughly 8% and 25%, respectively, in fiscal 2009. The
company resumed its dividend in October 2021 after suspending it at
the height of the pandemic in 2020. The company also resumed share
repurchases with a $75 million buyback in FY22. Vail does not have
a leverage target and will likely continue to add to the property
portfolio through acquisitions, though maintaining moderate
leverage is important to the company due to cyclical demand and the
desire to maintain the dividend.
The Ba2 CFR is supported by Vail's leading position in the North
American ski industry with a very strong portfolio of resorts,
including some premier destinations that attract high income
consumers and can command higher prices relative to peers.
Additionally, Vail benefits from its good geographic
diversification and high local skier customer mix. High and growing
Epic Pass penetration provides a stable revenue stream that helps
partially mitigate weather exposure. Furthermore, the North
American ski industry has high barriers to entry and has showed
resiliency during weak economic periods, including the 2007-2009
recession and strong yield management during the 2020-2021 ski
season when volume was hurt by pandemic-related restrictions.
Additionally, Vail's sizable $1.1 billion cash balance as of July
2022 as well as healthy free cash flow generation supports very
good liquidity. The very good liquidity provides considerable
flexibility to manage through a period of weak earnings and to
reinvest through capital improvements and acquisitions. Vail also
has flexibility to adjust capital spending depending on operating
performance to preserve cash if necessary.
Vail's environmental risk is highly negative (E-4). Physical
climate risk is highly negative due to exposure to changing weather
that could result from climate shifts and the reliance on cold
weather activities. The geographic diversity of the company's
properties is good but does not fully mitigate the physical climate
risks. Water management risk is also highly negative due to the
need to access large quantities of water, which requires investment
to ensure sufficient water availability and access rights. Water
availability may be challenging following periods of severe
drought. Natural capital is moderately negative as the company is
responsible to properly operate and protect the vast amount of
forest land and mountains. Energy needs are also meaningful.
Vail's social risk profile is moderately negative (S-3) due to
Moody's view that customer relations and human capital risk are
moderately negative. Most of Vail's workers at its mountains and
resorts are hourly wage workers that tend to have high turnover.
Additionally, staffing at expensive resort towns like Vail,
Colorado is also challenging due to lack of sufficient affordable
housing for workers. Investments in dormitories and wages to
attract and retain staff consume cash and can weaken margins.
However, Vail's geographic diversity and pricing power helps to
partially mitigate this risk. Vail experienced challenges keeping
its facilities and resorts fully staffed in the past ski season,
which negatively impacted its customer relations. Additionally,
customer relations risk is moderately negative due to the need to
invest in facilities and maintain strong service offerings to
sustain consumer demand. Vail also has exposure to data security
and customer privacy risk as the company has sensitive customer
information such as credit card numbers and personal information.
Vail's governance risk profile is moderately negative (G-3) linked
primarily to financial policy with risk related to its willingness
to operate with high leverage, acquisition strategy and
dividend/share repurchase programs. Vail has been a consolidator in
recent years and has also expanded internationally in Australia and
Switzerland. Vail has been a dividend payer since 2011. The
dividend was suspended in 2020 during the pandemic to preserve
liquidity but has since resumed in October 2021. The company also
has completed meaningful share repurchases.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The stable outlook reflects Moody's expectation that stable ski
demand will allow the company to maintain gross debt-to-EBITDA in
the mid 3x range in FY23 despite potential cost pressures. The
stable outlook also reflects that the company's very good liquidity
provides considerable flexibility to reinvest and manage should
earnings be weaker than expected.
The ratings could be upgraded if Vail reduces cyclical volatility,
is able to sustain a strong EBITDA margin, and maintains good
facility reinvestment. Vail would also need to sustain gross
debt-to-EBITDA below 3.0x and retained cash flow (RCF) -to-net debt
above 25%, while also maintaining very good liquidity.
The ratings could be downgraded if gross debt-to-EBITDA is
sustained above 4x, or RCF-to-net debt falls below 17.5%. Weak
reinvestment, visitation declines, or margin deterioration could
also lead to a downgrade. In addition, if there is a material
weakening of liquidity for any reason, or the company's financial
policies become more aggressive, including undertaking a large
debt-funded acquisition, the ratings could be downgraded.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
Vail Resorts, Inc. is a leading operator of mountain resorts and
regional ski areas, operating 41 mountain resorts, with 36 in the
US, 1 in Canada, and 3 in Australia and 1 in Switzerland (55%
controlling interest). The company is publicly traded (NYSE: MTN)
and reported revenue of approximately $2.5 billion in the fiscal
year ended July 31, 2022.
VIASAT INC: Egan-Jones Keeps CCC+ Senior Unsecured Ratings
----------------------------------------------------------
Egan-Jones Ratings Company, on September 13, 2022, retained its
'CCC+' foreign currency and local currency senior unsecured ratings
on debt issued by Viasat, Inc. EJR also retained its 'B' rating on
commercial paper issued by the Company.
Headquartered in Carlsbad, California, Viasat, Inc. operates as a
communication company.
VOYAGER DIGITAL: Amends Account Holder & Unsecured Claims Details
-----------------------------------------------------------------
Voyager Digital Holdings, Inc., et al., submitted a First Amended
Disclosure Statement relating to the Second Amended Joint Plan
dated October 24, 2022.
The Debtors filed Chapter 11 cases in response to a short-term "run
on the bank" caused by the downturn in the cryptocurrency industry
generally and the default of a significant loan made to a third
party. Since the Petition Date, the Debtors worked tirelessly to
identify the most value-maximizing transaction for their customers
and other creditors on an expedited timeline.
Ultimately, those efforts were successful. Following a two-week
competitive auction process, the Debtors selected the bid submitted
by West Realm Shires Inc. ("FTX US" or "Purchaser") as the winning
bid. The Debtors value FTX US's bid at approximately $1.422
billion, comprised of (i) the value of Cryptocurrency on the
Voyager platform as of a date to be determined, which, as of
September 26, 2022, is estimated to be $1.311 billion, plus (ii)
additional consideration which is estimated to provide at least
approximately $111 million of incremental value.
Importantly, the FTX US bid can be effectuated quickly, provides a
meaningful recovery to creditors, and allows the Debtors to
facilitate an efficient resolution of these chapter 11 cases, after
which FTX US's market-leading, secured trading platform will enable
customers to trade and store cryptocurrency.
Class 3 consists of Account Holder Claims. Each Holder of an
Allowed Account Holder Claim will receive in exchange for such
Allowed Account Holder Claim:
* its Pro Rata share of Transferred Cryptocurrency Value, in
Cryptocurrency or Cash as provided in the Customer Migration
Protocol;
* the right to become a Transferred Creditor as provided in
the Customer Migration Protocol;
* its Pro Rata share of Distributable Cash; and
* to effectuate distributions from the Wind-Down Entity, its
Pro Rata share of the Wind-Down Trust Units on account of any
recovery of Wind-Down Trust Assets attributable to OpCo; provided
that any distributions on account of Wind-Down Trust Units shall
only be made following payment in full of Allowed Administrative
Claims, Allowed Priority Tax Claims, Allowed Secured Tax Claims,
and Allowed Other Priority Claims.
Class 5A consists of OpCo General Unsecured Claims. Each Holder of
an Allowed OpCo General Unsecured Claim will receive in exchange
for such Allowed OpCo General Unsecured Claim:
* its Pro Rata share of Transferred Cryptocurrency Value, in
Cryptocurrency or Cash as provided in the Customer Migration
Protocol;
* the right to become a Transferred Creditor as provided in
the Customer Migration Protocol;
* its Pro Rata share of Distributable OpCo Cash; and
* to effectuate distributions from the Wind-Down Entity, its
Pro Rata share of the Wind-Down Trust Units on account of any
recovery of Wind-Down Trust Assets attributable to OpCo; provided
that any distributions on account of Wind-Down Trust Units shall
only be made following payment in full of Allowed Administrative
Claims, Allowed Priority Tax Claims, Allowed Secured Tax Claims,
and Allowed Other Priority Claims.
Class 5B consists of HoldCo General Unsecured Claims. Each Holder
of an Allowed HoldCo General Unsecured Claim will receive in
exchange for such Allowed HoldCo General Unsecured Claim:
* its Pro Rata share of Distributable HoldCo Cash; and
* to effectuate distributions from the Wind-Down Entity, its
Pro Rata share of the Wind-Down Trust Units (if applicable) on
account of any recovery of Wind-Down Trust Assets attributable to
HoldCo; provided that any distributions on account of Wind-Down
Trust Units shall only be made following payment in full of Allowed
Administrative Claims, Allowed Priority Tax Claims, Allowed Secured
Tax Claims, and Allowed Other Priority Claims.
Class 5C consists of TopCo General Unsecured Claims. Each Holder of
an Allowed TopCo General Unsecured Claim will receive in exchange
for such Allowed TopCo General Unsecured Claim:
* its Pro Rata share of Distributable TopCo Cash; and
* to effectuate distributions from the Wind-Down Entity, its
Pro Rata share of the Wind-Down Trust Units (if applicable) on
account of any recovery of Wind-Down Trust Assets attributable to
TopCo; provided that any distributions on account of Wind-Down
Trust Units shall only be made following payment in full of Allowed
Administrative Claims, Allowed Priority Tax Claims, Allowed Secured
Tax Claims, and Allowed Other Priority Claims.
Class 7 consists of Intercompany Claims. On the Effective Date, all
Intercompany Claims shall be, at the option of the Debtors, either
(a) Reinstated or (b) converted to equity, otherwise set off,
settled, distributed, contributed, or cancelled, in each case in
accordance with the Restructuring Transactions Memorandum.
Class 8 consists of Intercompany Interests. On the Effective Date,
all Intercompany Interests shall be, at the option of the Debtors,
either (a) Reinstated in accordance with the Plan or (b) set off,
settled, addressed, distributed, contributed, merged, or cancelled,
in each case in accordance with the Restructuring Transactions
Memorandum.
The Plan will be funded with the proceeds of the sale transaction,
which the Debtors value at approximately $1.422 billion, consisting
primarily of: (a) the value of all Voyager cryptocurrency as of a
to be determined date, which, at current market prices as of
September 26, 2022, is estimated to be $1.311 billion, plus (b)
additional consideration estimated as providing at least
approximately $111 million of incremental value that includes (i) a
cash payment of $51 million, (ii) an earn out of up to $20 million,
(iii) the right of Transferred Creditors to receive a $50 Account
Credit, (iv) a cash payment equal to the Acquired Cash, and (v) the
transfer to the Debtors of all right, title, and interest in the
Alameda Loan Facility Claims.
A full-text copy of the First Amended Disclosure Statement dated
October 24, 2022, is available at https://bit.ly/3FpY3s7 from
Stretto, Inc., claims agent.
Counsel to the Debtors:
Joshua A. Sussberg, Esq.
Christopher Marcus, Esq.
Christine A. Okike, Esq.
Allyson B. Smith, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, NY 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
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, chief executive officer, the Debtors estimated
assets and liabilities between $1 billion and $10 billion.
Michael E. Wiles oversees the cases.
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.
On July 19, 2022, the U.S. Trustee for the Southern District of New
York appointed an official committee of unsecured creditors. The
Committee tapped McDermott Will & Emery as counsel, and FTI
Consulting as financial advisor. Epiq Corporate Restructuring,
LLC, is the Commitee's noticing and information agent.
VOYAGER DIGITAL: CEO Ehrlich Dropped from Crypto Ponzi Scheme Suit
------------------------------------------------------------------
Voyager Digital Holdings CEO Stephen Ehrlich has been cut from a
proposed securities class action accusing him, along with the
now-bankrupt crypto trading platform and the "Shark Tank"
personality and entrepreneur Mark Cuban, of running a Ponzi scheme
that conned consumers out of billions of dollars' worth of crypto.
On Aug. 10, 2022, a putative class-action litigation was filed in
the United States District Court for the Southern District of
Florida -- captioned Robertson, et al. v. Cuban, et al., o.
1:22-cv-22538-RKA (S.D. Fla. Aug. 10, 2022) (the "Robertson Class
Action") -- asserting various causes of action against Stephen
Ehrlich, Mark Cuban, and the Dallas Basketball Limited d/b/a Dallas
Mavericks, including aiding and abetting the Debtors' alleged fraud
claimed in the Cassidy Class Action and violations under federal
and state securities law and violations of state
consumer-protection laws. Cuban and Ehrlich, according to the
complaint, went to great lengths to use their experience as
investors to dupe millions of Americans into investing—in many
cases, their life savings—into the Deceptive Voyager Platform and
purchasing Voyager Earn Program Accounts ("EPAs"), which are
unregistered securities. As a result, over 3.5 million Americans
have now all but lost over 5 billion dollars in cryptocurrency
assets. This action seeks to hold Ehrlich, Cuban, and his Dallas
Mavericks responsible for paying them back
On Aug. 22, 2022, the Debtors commenced in Bankruptcy an adversary
proceeding -- captioned VOYAGER DIGITAL Voyager HOLDINGS, INC. et
al., Plaintiffs, v. PIERCE ROBERTSON et al., Defendants, Adv. Pro.
No. 22-01138, In re Voyager Holdings Inc., et al. (Bankr.
S.D.N.Y.) -- seeking to (i) extend the protections of 11 U.S.C. §
362 to the Robertson Action, or in the alternative, (ii) enjoin
pursuant to 11 U.S.C. Sec. 105(a), further proceedings in the
matter pending in the Robertson Action.
On the same date, the Debtors filed with the Bankruptcy a Motion to
Extend the Automatic Stay or, in the Alternative, for Injunctive
Relief Enjoining Prosecution of Certain Pending Litigation (the
"Stay Motion").
In a filing on Oct. 20, the parties informed the Bankruptcy Court
that they have reached a stipulation removing Mr. Ehlrich as
defendant in the Robertson Class Action. The stipulation was
entered into by (i) customers/plaintiffs Pierce Robertson, Rachel
Gold, Sanford Gold, Rahil Sayed, Christopher Ehrentraut, Todd
Manganiello, Dan Newsom, William Ayer, Anthony Dorn, Dameco Gates,
Marshall Peters, and Edwin Garrison, (ii) the Debtors, and (iii)
Stephen Ehrlich.
In an effort to avoid unnecessary litigation regarding the
Adversary Proceeding, the Robertson Action, and related motions,
the Debtors, the Customers, Mr. Ehrlich, and the Customers' counsel
jointly stipulate as follows:
1. Dismissal of Stephen Ehrlich as a Defendant in the Robertson
Action: The Parties agree that, on or before Oct. 21, 2022, the
Customers, through their counsel, shall take any and all steps that
are required to dismiss, with prejudice, Mr. Ehrlich as a defendant
in the Robertson Action, the Parties to bear their own costs and
attorneys' fees. Counsel for the Customers also covenant that
neither they nor others associated with Counsel will seek to file
claims that arise from or relate in any way to the allegations in
the Robertson Complaint or Proposed Amended Complaint against any
other officers, directors, or employees of the Debtors, on behalf
of any current or former Voyager customers or shareholders
2. Reservation of Rights. As described in the Debtors' Plan of
Reorganization, Mr. Ehrlich provided the Special Committee of the
Board of Directors and the Official Committee of Unsecured
Creditors with a financial disclosure as part of the Bankruptcy.
Mr. Ehrlich also provided counsel to the Customers with a financial
disclosures, bates stamped VOY-INV-00046163 - 46165. If and only
if, as described in the Plan, any court of competent jurisdiction
enters a final and non-appealable judgment determining that the
Ehrlich Financial Disclosure is materially inaccurate, the Parties
agree that nothing in this Stipulation and Order shall prohibit the
Customers from seeking to reinstate the claims against Mr. Ehrlich
and seeking to add him as a defendant to the Robertson Action. In
such case, Mr. Ehrlich agrees not to oppose a request by the
Customers that any applicable statutes of limitations or repose as
to claims against Mr. Ehrlich shall relate back to the Aug. 10,
2022 filing date of the initial complaint in the Robertson Action.
3. Continuance of the Robertson Action Without Ehrlich. The
Debtors and Mr. Ehrlich agree that, upon dismissal of Mr. Ehrlich
as a defendant in the Robertson Action, neither the Debtors nor Mr.
Ehrlich will (1) take the position that prosecution of the
Robertson Action violates the automatic stay, (2) seek to extend
the automatic stay to the Robertson Action, or (3) otherwise seek
to intervene in the Robertson Action, including, but not limited
to, oppose any request by The Moskowitz Law Firm, PLLC and Boies
Schiller Flexner LLP to be appointed as Interim Co-Lead Class
Counsel in the Robertson Action under Federal Rule of Civil
Procedure 23(g)(1)(A). For the avoidance of doubt, the Required
Dismissal Steps do not violate the automatic stay.
4. Dismissal of the Adversary Proceeding: Based on the covenant,
the Debtors agree that, upon the dismissal of Mr. Ehrlich as a
defendant in the Robertson Action with prejudice, the Adversary
Proceeding is voluntarily dismissed, with prejudice, with the
parties to bear their own costs and attorneys' fees.
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, chief executive officer, the Debtors estimated
assets and liabilities between $1 billion and $10 billion.
Michael E. Wiles oversees the cases.
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.
On July 19, 2022, the U.S. Trustee for the Southern District of New
York appointed an official committee of unsecured creditors. The
Committee tapped McDermott Will & Emery as counsel, and FTI
Consulting as financial advisor. Epiq Corporate Restructuring,
LLC, is the Commitee's noticing and information agent.
VOYAGER DIGITAL: Plan Slated for Dec. 8 Confirmation Hearing
------------------------------------------------------------
Judge Michael E. Wiles has entered an order approving the
Disclosure Statement of Voyager Digital Holdings, Inc., et al., as
providing holders of claims entitled to vote on the Plan with
adequate information to make an informed decision as to whether to
vote to accept or reject the Plan in accordance with Section
1125(a)(1) of the Bankruptcy Code.
These dates are established (subject to modification as necessary)
with respect to the solicitation of votes to accept or reject, and
voting on, the Plan:
* Oct. 19, 2022, as the date for determining (i) which holders
of claims in the voting classes are entitled to vote to accept or
reject the Plan and receive Solicitation Packages in connection
therewith and (ii) whether Claims have been properly assigned or
transferred to an assignee pursuant to Bankruptcy Rule 3001(e) such
that the assignee can vote as the Holder of the respective Claim;
* Nov. 1, 2022, as the deadline for distributing Solicitation
Packages, including Ballots, to Holders of Claims entitled to vote
to accept or reject the Plan;
* Nov. 15, 2022, as the deadline by which the Debtors must serve
each assumption notice to the applicable counterparties to
Executory Contracts and Unexpired Leases;
* Seven days prior to the Voting Deadline as the deadline by
which the Debtors must file the Plan Supplement; provided, that the
Customer Migration Protocol and Schedule of Retained Causes of
Action shall be filed at least 14 days prior to the Voting
Deadline;
* Nov. 29, 2022, at 4:00 p.m. prevailing Eastern Time as the
deadline by which all Ballots must be properly executed, completed,
and delivered so that they are actually received by Stretto, Inc.;
and
* Nov. 29, 2022, at 4:00 p.m. prevailing Eastern Time as the
deadline by which objections to the proposed cure costs must be
filed with the Court and served so as to be actually received by
the appropriate notice parties.
The Debtors are authorized, but not directed or required, to cause
the Solicitation Packages to be distributed through the Claims,
Noticing, and Solicitation Agent by e-mail to those holders of
claims in Class 3 and by first-class U.S. mail to those Holders of
Claims in Class 4 and Class 5. The Debtors shall provide a copy of
the Plan, the Disclosure Statement, and this Disclosure Statement
Order (without exhibits) to holders of claims in Class 4, Class 5A,
Class 5B, and Class 5C in electronic format (CD-ROM or flash drive)
and to Holders of Claims in Class 3 via e-mail. The Ballots, the
Cover Letter, the Committee Letter, the Solicitation and Voting
Procedures, and the Confirmation Hearing Notice shall be provided
by e-mail to Holders of Claims in Class 3 and in paper format to
holders of claims in Class 4, Class 5A, Class 5B, and Class 5C. On
or before the Solicitation Deadline, the Debtors (through the
Claims, Noticing, and Solicitation Agent) shall provide complete
Solicitation Packages (other than Ballots) to the U.S. Trustee and
to all parties on the 2002 List as of the Voting Record Date.
The Debtors will not provide the holders of Class 7 Intercompany
Claims or Class 8 Intercompany Interests with a Solicitation
Package or any other type of notice in connection with
solicitation.
The following dates are established (subject to modification as
needed) with respect to filing objections to the Plan and
confirming the Plan:
* Nov. 29, 2022, at 4:00 p.m. prevailing Eastern Time as the
deadline by which objections to the Plan must be filed with the
Court and served so as to be actually received by the appropriate
notice parties;
* Dec. 6, 2022, at 4:00 p.m., prevailing Eastern Time, as the
date by which the report tabulating the voting on the Plan shall be
filed with the Court;
* Dec. 6, 2022, at 4:00 p.m. prevailing Eastern Time as the
deadline by which the Debtors shall file their brief in support of
Confirmation of the Plan and the deadline by which replies to
objections to the Plan must be filed with the Court; and
* Dec. 8, 2022, or as soon thereafter as the Debtors may be
heard, as the date for the hearing at which the Court will consider
confirmation of the Plan.
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, chief executive officer, the Debtors estimated
assets and liabilities between $1 billion and $10 billion.
Michael E. Wiles oversees the cases.
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.
On July 19, 2022, the U.S. Trustee for the Southern District of New
York appointed an official committee of unsecured creditors. The
Committee tapped McDermott Will & Emery as counsel, and FTI
Consulting as financial advisor. Epiq Corporate Restructuring,
LLC, is the Commitee's noticing and information agent.
VOYAGER DIGITAL: Unsecureds, Customers to Get 72% in FTX Sale Plan
------------------------------------------------------------------
Voyager Digital Holdings, Inc., et al., submitted a First Amended
Disclosure Statement relating to the Second Amended Joint Plan
pursuant to Chapter 11 of the Bankruptcy Code.
The Debtors filed Chapter 11 cases in response to a short-term "run
on the bank" caused by the downturn in the cryptocurrency industry
generally and the default of a significant loan made to a third
party. Since the Petition Date, the Debtors worked tirelessly to
identify the most value-maximizing transaction for their customers
and other creditors on an expedited timeline. Ultimately, those
efforts were successful. Following a two-week competitive auction
process, the Debtors selected the bid submitted by West Realm
Shires Inc. ("FTX US") as the winning bid.
The Debtors value FTX US's bid at approximately $1.422 billion,
comprised of (i) the value of Cryptocurrency on the Voyager
platform as of a date to be determined, which, as of September 26,
2022, is estimated to be $1.311 billion, plus (ii) additional
consideration which is estimated to provide at least approximately
$111 million of incremental value. Importantly, the FTX US bid can
be effectuated quickly, provides a meaningful recovery to
creditors, and allows the Debtors to facilitate an efficient
resolution of these chapter 11 cases, after which FTX US's
market-leading, secured trading platform will enable customers to
trade and store cryptocurrency.
Under the Asset Purchase Agreement, FTX US will purchase all
Cryptocurrency on the Voyager platform, other than VGX, at fair
market value as of a to be determined date. The fair market value
of any Cryptocurrency other than VGX will be calculated by
Purchaser reasonably and in good faith based on market practice,
available pricing information, and mutually agreed principles.
FTX US has offered to purchase all VGX in the Debtors' Estates for
a purchase price of $10 million. This is a floor of what the
Debtors will receive for VGX. The Debtors continue to work
internally and with third parties in an effort to identify a higher
and better solution for VGX that is also compatible with the FTX US
Asset Purchase Agreement and are hopeful they will be able to do
so. Any such alternative solution, to be acceptable, must deliver
value to the Debtors and their Estates that exceeds $10 million and
must be compatible with the agreements between the Debtors and FTX
US. If the Debtors are unable to identify a higher and better
solution for VGX, the Debtors will accept FTX US's offer and, as a
result, VGX may decline in value and may have no value
post-consummation of the Plan.
The Debtors will effectuate the transition of Account Holders to
the FTX US platform pursuant to the Customer Migration Protocol,
which will be included in the Plan Supplement and will be filed
with the Bankruptcy Court in advance of the Voting Deadline. The
Customer Migration Protocol will provide, among other things, that
only those Account Holders that become Transferred Creditors at
least one Business Day prior to the Effective Date and who maintain
Cryptocurrency in their Account that is supported by FTX US will
receive their initial distributions under the Plan in-kind (i.e.,
in the form of Cryptocurrency) deposited into their FTX US
Accounts. If (x) Purchaser does not support the Cryptocurrency
maintained by a Transferred Creditor in such Transferred Creditor's
Account, (y) a Transferred Creditor did not maintain Cryptocurrency
in its Account, or (z) a Transferred Creditor becomes a Transferred
Creditor after such date but before the final migration cut-off
date 45 days after the Effective Date as contemplated in the
Customer Migration Protocol, such Transferred Creditor will receive
their share of the initial distribution in the form of USDC.
Account Holders who do not become Transferred Customers will not be
eligible to receive any portion of the initial distribution from
FTX US. All distributions to such account holders and all other
distributions will be made on a pro rata basis in cash from the
Debtors' Estates.
It is anticipated that all Voyager customers will be transitioning
to FTX US. In the event that a customer is not successfully
transitioned to FTX US, such customer will not be eligible for the
$50 Account Credit. Any customer that does not transition to FTX
US at least one Business Day prior to the Closing Date will not
receive the Transferred Cryptocurrency Value in kind. Instead,
such holder will receive a cash distribution from the Debtor's
estates as and when such distributions are made pursuant to the
Bankruptcy Code.
The Debtors seek to effectuate the transactions contemplated by the
Asset Purchase Agreement pursuant to the Plan. The Plan, among
other things:
* contemplates payment in full of Administrative Claims, Secured
Tax Claims, Priority Tax Claims, and Other Priority Claims;
* provides for the distribution of Cryptocurrency, Cash, and any
remaining assets at OpCo (including any recovery on account of the
3AC Claims) to Account Holders and Holders of OpCo General
Unsecured Claims, subject to the terms of the Asset Purchase
Agreement;
* provides for distribution of Cash and other assets at HoldCo
to Holders of HoldCo General Unsecured Claims;
* provides for distribution of Cash and other assets at TopCo to
Holders of TopCo General Unsecured Claims;
* provides for any residual value at TopCo after payment in full
of TopCo General Unsecured Claims to be distributed to Holders of
Section 510(b) Claims, if any, and Holders of Existing Equity
Interests;
* consensually conveys Alameda Loan Facility Claims and any
recovery on account of such Alameda Loan Facility Claims to OpCo
pursuant to the Asset Purchase Agreement; and
* designates a Wind-Down Entity Trustee to wind down the
Debtors' affairs in accordance with the Plan.
The Debtors believe that the Plan maximizes stakeholder recoveries
in the Chapter 11 Cases. Accordingly, the Debtors urge all Holders
of Claims entitled to vote to accept the Plan by returning their
ballots so that Stretto actually receives such ballots by Nov. 25,
2022, at 4:00 p.m. prevailing Eastern Time. Assuming the Plan
receives the requisite acceptances, the Debtors will seek the
Bankruptcy Court's approval of the Plan at a hearing on Dec. 6,
2022 at 11:00 a.m. (prevailing Eastern Time).
Under the Plan, holders of Account Holder claims in Class 3
totaling $1.764 billion will recover 72% under the Plan, compared
with 51% to 60% in a liquidation scenario. Each Holder of an
Allowed Account Holder Claim will receive:
(i) its Pro Rata share of Transferred Cryptocurrency Value, in
Cryptocurrency or
Cash as provided in the Customer Migration Protocol;
(ii) the right to become a Transferred Creditor as provided in the
Customer Migration Protocol;
(iii) its Pro Rata share of Distributable Cash; and
(iv) to effectuate distributions from the Wind-Down Entity, its
Pro Rata share of the Wind-Down Trust Units on account of any
recovery of Wind-Down Trust Assets attributable to OpCo; provided
that any distributions on account of Wind-Down Trust Units shall
only be made following payment in full of Allowed Administrative
Claims, Allowed Priority Tax Claims, Allowed Secured Tax Claims,
and Allowed Other Priority Claims.
Class 5A OpCo General Unsecured Claims totaling $12.1 million will
recover 72% of their claims under the Plan, compared with a 51% to
60% under a Liquidation. Class 5A is impaired. Each holder will
each will receive:
(i) its Pro Rata share of Transferred Cryptocurrency Value, in
Cryptocurrency or Cash as provided in the Customer Migration
Protocol;
(ii) the right to become a Transferred Creditor as provided in
the Customer Migration Protocol;
(iii) its Pro Rata share of Distributable OpCo Cash; and
(iv) to effectuate distributions from the Wind-Down Entity, its
Pro Rata share of the Wind-Down Trust Units on account of any
recovery of Wind-Down Trust Assets attributable to OpCo; provided
that any distributions on account of Wind-Down Trust Units shall
only be made following payment in full of Allowed Administrative
Claims, Allowed Priority Tax Claims, Allowed Secured Tax Claims,
and Allowed Other Priority Claims.
Class 5B HoldCo General Unsecured Claims totaling $0.0 will recover
nothing.
Class 5C TopCo General Unsecured Claims totaling $2.3 million will
recover 2% of their claims under the Plan and in a liquidation
scenario. Class 5C is impaired. Each holder will receive:
(i) its Pro Rata share of Distributable TopCo Cash; and
(ii) to effectuate distributions from the Wind-Down Entity, its
Pro Rata share of the Wind-Down Trust Units (if applicable) on
account of any recovery of Wind-Down Trust Assets attributable to
TopCo; provided that any distributions on account of Wind-Down
Trust Units shall only be made following payment in full of Allowed
Administrative Claims, Allowed Priority Tax Claims, Allowed Secured
Tax Claims, and Allowed Other Priority Claims.
The Plan will be funded with the proceeds of the sale transaction,
which the Debtors value at approximately $1.422 billion, consisting
primarily of: (a) the value of all Voyager cryptocurrency as of a
to be determined date, which, at current market prices as of
September 26, 2022, is estimated to be $1.311 billion, plus (b)
additional consideration estimated as providing at least
approximately $111 million of incremental value that includes (i) a
cash payment of $51 million, (ii) an earn out of up to $20 million,
(iii) the right of Transferred Creditors to receive a $50 Account
Credit, (iv) a cash payment equal to the Acquired Cash, and (v) the
transfer to the Debtors of all right, title, and interest in the
Alameda Loan Facility Claims.
Counsel to the Debtors:
Joshua A. Sussberg, Esq.
Christopher Marcus, Esq.
Christine A. Okike, Esq.
Allyson B. Smith, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, NY 10022
Telephone: (212) 446-4800
Facsimile: (212) 446-4900
E-mail: jsussberg@kirkland.com
cmarcus@kirkland.com
christine.okike@kirkland.com
allyson.smith@kirkland.com
A copy of the First Amended Disclosure Statement dated Oct. 19,
2022, is available at https://bit.ly/3z2iaIW from
PacerMonitor.com.
About Voyager Digital
Based in Toronto, Canada, Voyager Digital Holdings Inc. --
https://www.investvoyager.com/ -- runs a cryptocurrency platform.
Voyager claims to offer a secure way to trade over 100 different
crypto assets using its easy-to-use mobile application. Through its
subsidiary Coinify ApS, Voyager provides crypto payment solutions
for both consumers and merchants around the globe.
Voyager Digital Holdings Inc. and two affiliates sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Lead
Case No. 22-10943) on July 5, 2022. In the petition filed by
Stephen Ehrlich, as chief executive officer, the Debtor estimated
assets and liabilities between $1 billion and $10 billion.
The Debtors tapped KIRKLAND & ELLIS LLP as general bankruptcy
counsel; BERKELEY RESEARCH GROUP, LLC, as financial advisor; MOELIS
& COMPANY as investment banker; and CONSELLO GROUP as strategic
financial advisor. STRETTO, INC., is the claims agent.
WATLOW ELECTRIC: S&P Rates New $175MM First-Lien Term Loan 'B'
--------------------------------------------------------------
S&P Global Ratings assigned its 'B' issue-level rating and '3'
recovery rating to Watlow Electric Manufacturing Co.'s proposed
$175 million non-fungible incremental first-lien term loan. The '3'
recovery rating indicates its expectation for meaningful (50%-70%;
rounded estimate: 60%) recovery in the event of a default. The
company also plans to upsize its revolving credit facility by $22.5
million, to $72.5 million.
Watlow will use the proceeds from the proposed term loan, along
with cash from the balance sheet, to fund its acquisition of
Eurotherm from Schneider Electric, as well as to pay related
transaction fees and expenses. Eurotherm is a U.K.-based
manufacturer and supplier of temperature controls, power controls,
data management devices, and affiliated systems and software for
industrial customers. S&P views the acquisition favorably because
it will increase Watlow's scale and geographic and customer
diversity. Based on its results for the 12 months ended June 30,
2022, the acquisition will increase Watlow's revenue base by about
15%-20%. The acquisition will likely provide Watlow with
opportunities to cross-sell its complementary products to
Eurotherm's global customers, along with moderate cost synergies.
Eurotherm will also modestly improve Watlow's geographic diversity
(U.S. sales will decrease to 64% of revenue from 71% pro forma for
the transaction) and slightly reduce its exposure to the cyclical
semiconductor end market (decreasing to 47% from 52% pro forma).
S&P said, "Our 'B' issuer credit rating and stable outlook on
Watlow are not affected by the acquisition because we previously
incorporated an acquisition of this size in our base-case forecast.
We also continue to forecast that the company's S&P Global
Ratings-adjusted leverage will remain at least a turn below our
6.5x downgrade threshold over the next several quarters. Pro forma
for the completion of the acquisition and a full year of
Eurotherm's earnings and cash flow, we forecast Watlow's S&P Global
Ratings-adjusted leverage will improve to around 5x as of June 30,
2022, and decrease to the 4.5x-5.0x range by the end of 2022. In
addition, we anticipate the company will continue to increase its
EBITDA through 2023, which will translate to S&P Global
Ratings-adjusted leverage of between 4x and 5x.
"Our forecast incorporates Watlow's recent good operating
performance and our assumption that it will continue to experience
solid growth through 2022 on continued demand across its end
markets, particularly from the semiconductor industry. We forecast
the company's organic revenue will increase by about 20% in 2022,
improving its S&P Global Ratings-adjusted EBITDA margin to about
21.0% from 18.7% in 2021, because its volume growth and pricing
actions will offset its inflation-related cost increases. However,
we expect its expansion will moderate in 2023 due to a weaker
macroeconomic environment and slowing customer capital expenditure
in the semiconductor end market, which will lead its organic
revenue (pro forma for a full year of contributions from Eurotherm)
to rise by the low- to mid-single digit percent area. Absent a
material industry downturn, we expect Watlow will maintain S&P
Global Ratings-adjusted EBITDA margins in the 21%-22% area in 2023
as it benefits from some volume and pricing growth, as well as the
ongoing transfer of its production footprint to lower-cost regions.
Nevertheless, a larger-than-expected economic downturn in 2023 that
negatively affects its volumes and margins (notably in the cyclical
semiconductor segment) or leads to difficulties with the
integration of Eurotherm acquisition poses a risk to our base
case.
"Further, we expect the company will continue to generate moderate,
but improving, levels of free operating cash flow (FOCF) in 2022
after its sizable working capital usage to support its rapid
expansion and heightened capital expenditure (capex) related to
investments in its new facility in Malaysia. In 2023, we forecast
Watlow's FOCF will increase given our forecast for improving EBITDA
and moderating working capital usage amid its slowing revenue
growth. We believe the company will partially offset the increase
in its operating cash flow with higher capital expenditure as it
continues to invest in Malaysia and undertakes a company-wide
enterprise resource planning (ERP) system upgrade. We expect the
company's liquidity will remain adequate, supported by its good
level of balance sheet cash and expected availability under its
upsized $72.5 million revolving credit facility."
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P's simulated default scenario contemplates a default
occurring in 2025 due to sharp revenue and margin declines arising
from a significant downturn in the cyclical semiconductor and
industrial markets that reduce the demand for its products.
-- S&P has revised our emergence EBITDA to $99 million from $71
million to reflect the additional value from Eurotherm, as well as
the material growth it has experienced in 2022.
-- The gross enterprise value of $495 million is based on
emergence EBITDA of $99 million. S&P believes that the company's
lenders will aim to maximize its value and pursue a reorganization
rather than a liquidation in a default scenario. Therefore, S&P
values Watlow on a going-concern basis and apply a 5x multiple to
its projected emergence EBITDA.
Simulated default assumptions
-- Simulated year of default: 2025
-- EBITDA at emergence: $99 million
-- EBITDA multiple: 5.0x
-- Jurisdiction: U.S.
-- Revolving credit facility assumed 85% drawn at default
Simplified waterfall
-- Gross enterprise value: $495 million
-- Net enterprise value (after 5% administrative costs): $470
million
-- Valuation split (obligors/nonobligors): 64%/36%
-- Collateral value available to first-lien debt claims: $411
million
-- Unpledged value: $59 million
-- Estimated first-lien debt claims: $754 million
--Recovery expectations: 50-70% (rounded estimate: 60%)
Note: Debt amounts include six months of accrued interest that S&P
assumes will be owed at default. Collateral value includes asset
pledges from obligors (after priority claims) plus equity pledges
from nonobligors.
WENDY'S CO: Egan-Jones Keeps B Senior Unsecured Ratings
-------------------------------------------------------
Egan-Jones Ratings Company, on September 16, 2022, retained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by The Wendy's Company.
Headquartered in Dublin, Ohio, The Wendy's Company operates
fast-food restaurants.
WESCO INTERNATIONAL: Egan-Jones Keeps BB- Senior Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company, on September 13, 2022, retained its
'BB-' foreign currency and local currency senior unsecured ratings
on debt issued by WESCO International, Inc.
Headquartered in Pittsburgh, Pennsylvania, WESCO International,
Inc. distributes electrical products and other industrial
maintenance, repair, and operating supplies.
WEYERBACHER BREWING: $525K Sale of Assets to Change Capital OK'd
----------------------------------------------------------------
Judge Patricia M. Mayer of the U.S. Bankruptcy Court for the
Eastern District of Pennsylvania approved the stipulation of
Weyerbacher Brewing Company, Inc., Truist Bank, Premier Properties
of Pennsylvania, Edwin Lozano, and Marvin Deemer regarding the
approval of sale of certain assets of the Debtor to Change Capital
Holdings, LLC, for $525,000.
On Aug. 10, 2022, Change submitted a qualifying bid for the Sale
Assets for a purchase price of $600,000, as well as, inter alia, an
execution-ready asset purchase agreement and an initial deposit of
$50,000. Following the Auction, Change paid the Debtor an
additional deposit of $10,000. For the avoidance of doubt, the
Purchaser claims no interest in the Change Sale Deposit.
The Debtor has terminated the Change Sale Agreement due to Change's
failure to close in accordance with the Change Sale Agreement. It
reserves the right to seek all appropriate remedies as a result of
Change's material breach under the Change Sale Agreement, including
but not limited to, retaining the Change Sale Deposit.
Nevertheless, to effectively replicate the outcome to the Debtor's
estate, the parties have agreed, subject to approval of the
Bankruptcy Court, that the Purchaser will purchase the Sale Assets
directly from the Debtor.
The Debtor confirms that Bank holds a security interest in, and
lien on, the Debtor's claims against Change (including but not
limited to the right to the retention of the Change Sale Deposit as
a result of material breach under the Change Sale Agreement) on
account of the Bank's perfected prepetition and postpetition
security interests and adequate protection liens thereon.
The Purchaser and the Debtor will execute an asset purchase
agreement in form and substance similar to the Sale Agreement with
the exception of the following: (a) the purchase price will be
$525,000, which will be remitted directly to the Bank less the US
Trustee Fee; and (b) the closing date will occur by Sept. 30, 2022.
Upon payment by the Purchaser to the Bank of the amount set forth,
the Sale Assets will be transferred to the Purchaser free and clear
of all liens, claims and encumbrances, including, without
limitation, the liens of the Bank. The Bank retains its security
interest and liens on all other assets retained by the Debtor and
its estate (including, but not limited to, the Debtor’s claims
against Change).
That certain Commercial Lease Agreement by and between the Debtor
and Premier Properties dated June 1, 2010, that certain Commercial
Lease Agreement by and between the Debtor and Premier Properties
dated May 18, 2011 and that certain Commercial Lease Agreement by
and between the Debtor and Premier Properties dated March 28, 2012,
as any of the same may have been amended, modified and/or extended
from time to time will be deemed rejected, and the Debtor is deemed
to have irrevocably turned over to Premier Properties all of its
right, title and interest in and to the premises covered by the
Commercial Leases.
Upon and after closing on the sale pursuant to the Sale Agreement
and Sale Order, the Bank agrees to allow the Purchaser to withhold
from the purchase price and to remit the same to Debtor and its
estate to satisfy the estimated quarterly fees owing to the Office
of the United States Trustee through September of 2022 an amount
equal to the lesser of: (a) the actual and estimated quarterly fees
owing to the Office of the United States Trustee through September
of 2022; and (b) $7,500.
The stay provisions set forth in Federal Rule of Bankruptcy
Procedure 6004(h) are waived and closing may occur immediately.
The Sale Order will be deemed modified to approve the sale of the
Sale Assets by the Debtor to the Purchaser as set forth and
otherwise to the extent necessary to reflect the terms thereof.
The effectiveness of this Stipulation is expressly conditioned upon
approval by the Bankruptcy Court.
About Weyerbacher Brewing Co.
Weyerbacher Brewing Company, Inc., sought protection under Chapter
11 of the Bankruptcy Code (Bankr. E.D. Pa. Case No. 22-11665) on
June 27, 2022. In the petition signed by Daniel Weirback,
president, the Debtor disclosed up to $10 million in both assets
and liabilities.
Judge Patricia M. Mayer oversees the case.
Albert A. Ciardi III, Esq., at Ciardi Ciardi & Astin, P.C., is the
Debtor's counsel.
WILDWOOD VILLAGES: Trustee's Proposed Sale of Assets to Etalia OK'd
-------------------------------------------------------------------
Judge Roberta A. Colton of the US Bankruptcy Court for the Middle
District of Florida authorized the proposed sale by Ross Johnston,
the plan trustee appointed in Wildwood Villages, LLC's Chapter 11
case, of the following assets of the Debtor to Etalia Holdings,
LLC, subject to higher and better offers:
(A) Approximately 48 lots (two of which include mobile homes)
of real property located within the Wildwood Properties, and all
improvements, fixtures, and appurtenances thereon;
(B) Any rights originating under that certain Assignment of
Developer's Rights by and between LHTW Properties, Inc., and
Wildwood Villages, LLC, including the right, subject to any
disputes, litigation, defenses, or adjustment, to collect such
accounts
receivable due and owing as of the date of closing with respect to
monthly maintenance assessments, monthly fees, maintenance charges,
and such other amounts as may be due under the Declarations; and
(C) Additional Property, including internal roads and Parcel
ID G16A400.
The assets to be sold do not include, among other things, remaining
sums due related to the Debtor's sale of The Villages Parcels or
the estate's funds/cash.
The Real Property Assets will be sold free and clear of all liens,
claims, interests, rights and encumbrances, with all such claims
attaching to the proceeds of the sale.
The Notice of Auction and Bidding Procedures and the Auction and
Bidding Procedures are approved. The Plan Trustee will cause the
Notice of Auction and Bidding Procedures and the Auction and
Bidding Procedures upon the Notice Parties.
In the event that the Plan Trustee receives at least one Qualified
Bid (other than from the Purchaser) by the Bidding Deadline, an
auction of the Real Property Assets will occur to determine the
highest and otherwise best bid with respect to the Real Property
Assets. If, however, no such Qualified Bid other than the Qualified
Bid of Etalia is received by the Bidding Deadline, the Plan Trustee
will report the same to the Bankruptcy Court, declare the Stalking
Horse Purchaser as the Successful Bidder, and seek approval of the
sale to the Stalking Horse Purchaser at the Sale Hearing.
The Plan Trustee will have 30 days from the date of Closing within
which to file a Notice of Rejection as to the Redoubted Lease. The
Successful Bidder will have the obligation to notify the Plan
Trustee, at least two business days in advance of the 30-day
deadline, if it desires to reject the Redoubted Lease. Redoubted
may file any objections to the assumption or rejection within 14
days of the conclusion of the notice period.
In compliance with Bankruptcy Rules 2002 and 6004, the Order will
be served upon all creditors and all known parties who have
asserted a lien, right, or interest in the Real Property Assets.
About Wildwood Villages, LLC
Wildwood Villages, LLC is engaged in activities related to real
estate.
Wildwood Villages, LLC filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. M.D. Fla. Case No.
20-02569) on August 28, 2020. The petition was signed by Jonathan
Woods, manager. The Debtor disclosed $3,150,861 in assets and
$3,428,386 in liabilities. Matthew S. Kish, Esq., Esq. at SHAPIRO
BLASI WASSERMAN & HERMANN, PA represents the Debtor as counsel.
WINDSTREAM HOLDINGS: Too Late to Undo Plan, Says 2nd Circuit
------------------------------------------------------------
The Second Circuit on Tuesday, Oct. 25, 2022, rejected an appeal of
the confirmation of Windstream Holding's Chapter 11 plan, telling
bondholders that it is too late to undo the cable company's
restructuring.
According to The Wall Street Journal, the U.S. Court of Appeals for
the Second Circuit upheld the chapter 11 restructuring of
Windstream Holdings Inc., finding bondholder complaints about the
debt-cutting plan moot because reversing it would mean unwinding
transactions that have already taken place. The court backed
Windstream's 2020 restructuring, which put Elliott Management Corp.
and other senior creditors in control of the business while wiping
out junior bondholders owed roughly $2.4 billion.
About Windstream Holdings
Windstream Holdings, Inc., and its subsidiaries provide advanced
network communications and technology solutions for businesses
across the United States. They also offer broadband, entertainment
and security solutions to consumers and small businesses primarily
in rural areas in 18 states.
Windstream Holding Inc. and its subsidiaries filed for bankruptcy
protection (Bankr. S.D.N.Y. Lead Case No. 19-22312) on Feb. 25,
2019.
The Debtors had total assets of $13,126,435,000 and total debt of
$11,199,070,000 as of Jan. 31, 2019.
The Debtors tapped Kirkland & Ellis LLP and Kirkland & Ellis
International LLP as counsel; PJT Partners LP as financial advisor
and investment banker; Alvarez & Marsal North America LLC as
restructuring advisor; and Kurtzman Carson Consultants as notice
and claims agent.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors on March 12, 2019. The committee tapped
Morrison & Foerster LLP as its legal counsel, AlixPartners, LLP, as
its financial advisor, and Perella Weinberg Partners LP as
investment banker.
WOLVERINE WORLD: Egan-Jones Keeps B Senior Unsecured Ratings
------------------------------------------------------------
Egan-Jones Ratings Company, on September 15, 2022, retained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by Wolverine World Wide, Inc.
Headquartered in Rockford, Michigan, Wolverine World Wide, Inc.
manufactures and markets branded footwear and performance
leathers.
ZEN RESTORATION: Exclusivity Period Extended to Jan. 20
-------------------------------------------------------
Zen Restoration, Inc. has been given more time to file its plan for
emerging from Chapter 11 protection.
Judge Nancy Hershey Lord of the U.S. Bankruptcy Court for the
Eastern District of New York extended the company's exclusive right
to file a Chapter 11 plan of reorganization to Jan. 20, 2023, and
to solicit votes from creditors to March 20, 2023.
Zen Restoration will use the extension to reconcile tax claims from
the NYS Department of Taxation and from the Internal Revenue
Service, and to structure some type of settlement with Humboldt
Industrial, LLC, which holds two mortgages against its real
property in Brooklyn, N.Y.
About Zen Restoration
Zen Restoration Inc. -- https://www.zengeneral.com/ -- is a full
service construction company in Brooklyn, N.Y., which specializes
in restoration and repair of high-rise and residential buildings.
Zen Restoration sought Chapter 11 bankruptcy protection (Bankr.
E.D.N.Y. Case No. 22-40809) on April 19, 2022, with between $1
million and $10 million in assets and between $10 million and $50
million in liabilities. Bernard Sobus, president of Zen
Restoration, signed the petition.
Judge Nancy Hershey Lord oversees the case.
Ronald D. Weiss, Esq., at Ronald D. Weiss, P.C. is the Debtor's
legal counsel.
[^] BOND PRICING: For the Week from October 24 to 28, 2022
----------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
Ahern Rentals Inc AHEREN 7.375 69.921 5/15/2023
Ahern Rentals Inc AHEREN 7.375 70.679 5/15/2023
Air Methods Corp AIRM 8.000 49.811 5/15/2025
Air Methods Corp AIRM 8.000 49.643 5/15/2025
Audacy Capital Corp CBSR 6.500 29.789 05/01/2027
Avaya Holdings Corp AVYA 2.250 20.000 6/15/2023
Avient Corp AVNT 5.250 100.000 3/15/2023
BPZ Resources Inc BPZR 6.500 3.017 03/01/2049
Bank of America Corp BAC 2.936 92.619 12/10/2058
Bed Bath & Beyond Inc BBBY 3.749 20.939 08/01/2024
Bed Bath & Beyond Inc BBBY 4.915 9.846 08/01/2034
Bed Bath & Beyond Inc BBBY 5.165 10.227 08/01/2044
Buckeye Partners LP BPL 6.375 79.351 1/22/2078
Buffalo Thunder
Development
Authority BUFLO 11.000 54.626 12/09/2022
Citigroup Global
Markets Holdings
Inc/United States C 7.500 77.570 4/26/2032
Clovis Oncology Inc CLVS 4.500 58.241 08/01/2024
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 19.600 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 6.625 4.740 8/15/2027
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 7.500 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 20.096 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 6.625 4.633 8/15/2027
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 7.013 8/15/2026
Diamond Sports Group
LLC / Diamond Sports
Finance Co DSPORT 5.375 20.568 8/15/2026
Diebold Nixdorf Inc DBD 8.500 49.844 4/15/2024
EnLink Midstream
Partners LP ENLK 6.000 74.875 N/A
Energy Conversion
Devices Inc ENER 3.000 7.875 6/15/2013
Energy Transfer LP ET 6.250 83.750 N/A
Envision Healthcare EVHC 8.750 30.640 10/15/2026
Envision Healthcare EVHC 8.750 31.737 10/15/2026
Exela Intermediate
LLC / Exela Finance EXLINT 11.500 28.385 7/15/2026
Exela Intermediate
LLC / Exela Finance EXLINT 10.000 65.251 7/15/2023
Exela Intermediate
LLC / Exela Finance EXLINT 11.500 28.761 7/15/2026
Exela Intermediate
LLC / Exela Finance EXLINT 10.000 65.251 7/15/2023
GNC Holdings Inc GNC 1.500 0.814 8/15/2020
GTT Communications Inc GTTN 7.875 6.897 12/31/2024
GTT Communications Inc GTTN 7.875 6.750 12/31/2024
General Electric Co GE 4.200 79.780 N/A
Goldman Sachs Group GS 5.000 93.551 N/A
ION Geophysical Corp IO 8.000 11.000 12/15/2025
Lannett Co Inc LCI 7.750 28.342 4/15/2026
Lannett Co Inc LCI 4.500 29.934 10/01/2026
Lannett Co Inc LCI 7.750 28.065 4/15/2026
Lightning eMotors Inc ZEV 7.500 64.000 5/15/2024
MAI Holdings Inc MAIHLD 9.500 29.845 06/01/2023
MAI Holdings Inc MAIHLD 9.500 29.845 06/01/2023
MAI Holdings Inc MAIHLD 9.500 29.845 06/01/2023
MBIA Insurance Corp MBI 15.339 11.077 1/15/2033
MBIA Insurance Corp MBI 15.700 11.077 1/15/2033
Macquarie
Infrastructure
Holdings LLC MIC 2.000 95.000 10/01/2023
Morgan Stanley MS 1.800 68.433 8/27/2036
National CineMedia LLC NATCIN 5.750 8.161 8/15/2026
OMX Timber Finance
Investments II LLC OMX 5.540 0.850 1/29/2020
Party City Holdings PRTY 6.125 41.250 8/15/2023
Party City Holdings PRTY 6.625 32.552 08/01/2026
Party City Holdings PRTY 6.625 32.552 08/01/2026
Party City Holdings PRTY 6.125 41.599 8/15/2023
Plains All American
Pipeline LP PAA 6.125 82.625 N/A
Quotient Technology QUOT 1.750 94.818 12/01/2022
Renco Metals Inc RENCO 11.500 24.875 07/01/2003
RumbleON Inc RMBL 6.750 46.592 01/01/2025
Sears Holdings Corp SHLD 6.625 5.188 10/15/2018
Sears Holdings Corp SHLD 6.625 3.168 10/15/2018
Sears Roebuck
Acceptance Corp SHLD 7.500 1.500 10/15/2027
Sears Roebuck
Acceptance Corp SHLD 6.500 2.000 12/01/2028
Sears Roebuck
Acceptance Corp SHLD 6.750 1.750 1/15/2028
Sears Roebuck
Acceptance Corp SHLD 7.000 1.882 06/01/2032
Shift Technologies Inc SFT 4.750 20.350 5/15/2026
TPC Group Inc TPCG 10.500 53.784 08/01/2024
TPC Group Inc TPCG 10.500 53.784 08/01/2024
Terminix Co LLC/The SERV 7.450 111.447 8/15/2027
Terminix Co LLC/The SERV 7.250 130.545 03/01/2038
TerraVia Holdings Inc TVIA 5.000 4.644 10/01/2019
Tricida Inc TCDA 3.500 9.250 5/15/2027
US Renal Care Inc USRENA 10.625 39.046 7/15/2027
US Renal Care Inc USRENA 10.625 41.464 7/15/2027
UpHealth Inc UPH 6.250 31.500 6/15/2026
Vroom Inc VRM 0.750 32.250 07/01/2026
Wesco Aircraft
Holdings Inc WAIR 13.125 26.197 11/15/2027
Wesco Aircraft
Holdings Inc WAIR 8.500 51.309 11/15/2024
Wesco Aircraft
Holdings Inc WAIR 13.125 26.197 11/15/2027
Wesco Aircraft
Holdings Inc WAIR 8.500 52.224 11/15/2024
Wilton Re Finance LLC WILTON 5.875 83.532 3/30/2033
Wilton Re Finance LLC WILTON 5.875 83.532 3/30/2033
Wilton Re Finance LLC WILTON 5.875 83.532 3/30/2033
*********
Monday's edition of the TCR delivers a list of indicative prices
for bond issues that reportedly trade well below par. Prices are
obtained by TCR editors from a variety of outside sources during
the prior week we think are reliable. Those sources may not,
however, be complete or accurate. The Monday Bond Pricing table
is compiled on the Friday prior to publication. Prices reported
are not intended to reflect actual trades. Prices for actual
trades are probably different. Our objective is to share
information, not make markets in publicly traded securities.
Nothing in the TCR constitutes an offer or solicitation to buy or
sell any security of any kind. It is likely that some entity
affiliated with a TCR editor holds some position in the issuers
public debt and equity securities about which we report.
Each Tuesday edition of the TCR contains a list of companies with
insolvent balance sheets whose shares trade higher than $3 per
share in public markets. At first glance, this list may look like
the definitive compilation of stocks that are ideal to sell short.
Don't be fooled. Assets, for example, reported at historical cost
net of depreciation may understate the true value of a firm's
assets. A company may establish reserves on its balance sheet for
liabilities that may never materialize. The prices at which
equity securities trade in public market are determined by more
than a balance sheet solvency test.
On Thursdays, the TCR delivers a list of recently filed
Chapter 11 cases involving less than $1,000,000 in assets and
liabilities delivered to nation's bankruptcy courts. The list
includes links to freely downloadable images of these small-dollar
petitions in Acrobat PDF format.
Each Friday's edition of the TCR includes a review about a book of
interest to troubled company professionals. All titles are
available at your local bookstore or through Amazon.com. Go to
http://www.bankrupt.com/books/to order any title today.
Monthly Operating Reports are summarized in every Saturday edition
of the TCR.
The Sunday TCR delivers securitization rating news from the week
then-ending.
TCR subscribers have free access to our on-line news archive.
Point your Web browser to http://TCRresources.bankrupt.com/and use
the e-mail address to which your TCR is delivered to login.
*********
S U B S C R I P T I O N I N F O R M A T I O N
Troubled Company Reporter is a daily newsletter co-published
by Bankruptcy Creditors Service, Inc., Fairless Hills,
Pennsylvania, USA, and Beard Group, Inc., Philadelphia, Pa., USA.
Randy Antoni, Jhonas Dampog, Marites Claro, Joy Agravante,
Rousel Elaine Tumanda, Joel Anthony G. Lopez, Psyche A. Castillon,
Ivy B. Magdadaro, Carlo Fernandez, Christopher G. Patalinghug, and
Peter A. Chapman, Editors.
Copyright 2022. All rights reserved. ISSN: 1520-9474.
This material is copyrighted and any commercial use, resale or
publication in any form (including e-mail forwarding, electronic
re-mailing and photocopying) is strictly prohibited without prior
written permission of the publishers. Information contained
herein is obtained from sources believed to be reliable, but is
not guaranteed.
The TCR subscription rate is $975 for 6 months delivered via
e-mail. Additional e-mail subscriptions for members of the same
firm for the term of the initial subscription or balance thereof
are $25 each. For subscription information, contact Peter A.
Chapman at 215-945-7000.
*** End of Transmission ***