/raid1/www/Hosts/bankrupt/TCR_Public/221214.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Wednesday, December 14, 2022, Vol. 26, No. 347
Headlines
2377 NW KEARNEY: Taps Law Office of Conde Cox as Special Counsel
243 FOOD: Wins Interim Cash Collateral Access
5 SHORE DRIVEKP: Files for Chapter 11; Lender Seeks Stay Relief
575 BOULEVARD LLC: SARE Files for Chapter 11 Bankruptcy
772 & 720 HOLDING: Court OKs Deal on Cash Collateral Access
96 WYTHE: Trustee Plan Relies on BSP Deal, Sale
A CAB SERIES: Case Summary & Nine Unsecured Creditors
ACER THERAPEUTICS: Nets $4.1 Million From Recent Common Stock Sale
AIBUY HOLDCO: Targets Mid-February Hearing on Plan
ALCON CONTRACTORS: Court Confirms Reorganization Plan
ALEXANDER JONES: Sandy Hook Families Seek Stay Relief
AQUA SHIELD: Plan Confirmation Deadline Extended to March 6
ARETE REHABILIATION: Files Emergency Bid to Use Cash Collateral
BESTWALL LLC: Urges 4th Circuit to Overturn Georgia Pacific Stay
BOY SCOUTS: Ohio House Passes Bill to Help Abuse Survivors
CAPITOL PRESORT: Says Firstrust Bank Now Backing Plan
CAROLINA CAJUNS: Taps Stuart K. Clark as Accountant
CELSIUS NETWORK: Return to Custody Account Holders Okayed
CENTRAL FLORIDA CIVIL: Amends Several Secured Claims Pay Details
CENTRAL FLORIDA CIVIL: Wins Final Cash Collateral Access
CLAIM JUMPER: Wins Cash Collateral Access, $1.520MM DIP Loan
CMR REAL ESTATE: Continued Operations to Fund Plan Payments
CNX RESOURCES: Former COO to Receive $161,539 Cash, Other Benefits
COMMUNITY HEALTH: Amends Equity Award Pacts With Non-Exec Chairman
CRED INC: Trustee Sues Earnity Over 'Stolen' Intellectual Property
CRYSTALLEX INT'L: Bid for Examiner Denied, Recognition Granted
CUSTOM ALLOY: Court OKs Cash Collateral Access
CUTTING EDGE: Court OKs Final Cash Collateral Access
CYTODYN INC: All Three Proposals Passed at Annual Meeting
DYNATRACE LLC: Moody's Raises CFR to Ba2, Outlook Stable
E. LYNN SCHOENMANN: Plaintiffs' Bid for Summary Judgment Denied
EKSO BIONICS: Board Appoints Scott Davis as Director
EMERALD GRANDE: Files for Chapter 11 Bankruptcy
EMPIRE COUNTERTOPS: Seeks Chapter 11 to Stop Trustee Sale
FOX SUBACUTE: Addresses Philadelphia Plan Objection
FREEMANVILLE LIFEHOPE: Files for Chapter 11 Bankruptcy
FTX TRADING: SBF Taps Mark Cohen as Defense Lawyer
G.D. III: Trustee Taps Miles & Stockbridge as Legal Counsel
GIRARDI & KEESE: Erika's Earrings Sold for $312,000 at Auction
GUNITE MASTERS: Voluntary Chapter 11 Case Summary
H&S ALANG: Court Approves Disclosure Statement
HINTONS5 LLC: Unsecureds Owed $5K to Get $500 in Sale Plan
HOUSTON AMERICAN: Increases Interest in Colombian CPO-11 Project
IBEC LANGUAGE: Court Confirms Reorganization Plan
ICEBOX HOLDCO: S&P Rates $150MM First-Lien Term Loan 'B-'
INFINERA CORP: Board Approves Amended and Restated Bylaws
JUUL LABS: Settles More Than 5,000 Youth Vaping Lawsuits
KEYWAY APARTMENT: Trustee Taps Miles & Stockbridge as Legal Counsel
KNOW LABS: Extends Convertible Notes Due Dates to January 2023
KNOW LABS: Extends Struve Convertible Notes Due Date to Sept. 2023
KOSMOS ENERGY: Moody's Cuts CFR to B3 & Alters Outlook to Negative
LABORATORIO ACROPOLIS: Unsecureds to Split $45K over 55 Months
LV FORTUNE: Taps Valuation Source as Real Estate Appraiser
M1 DEVELOPMENT: Says Stormfield Not a Creditor of Debtor
MARYLAND ECONOMIC: Moody's Affirms Ba1 Rating on $14.03MM Bonds
MDWERKS INC: Issues 90 Million Common Shares to Tradition Reserve I
MOBIQUITY TECHNOLOGIES: Posts $2.3-Mil. Net Loss in Third Quarter
MONTANA TUNNELS: Dormant Mine Owner Seeks Chapter 11
MUSCLE MAKER: Discusses Specifics of AGGIA Agreement
MYLIFE.COM INC: Rancourt Action is Stayed as to Jeffrey Tinsley
NO RUST REBAR: Appellants' Designation of Contents is Striken
NO RUST REBAR: Green Tech OK'd to Snub Rule 2004 Discovery
NORTH AMERICAN: Case Summary & 12 Unsecured Creditors
ORIGIN AGRITECH: Appoints Dr. Shaojiang Chen as Director
PBF HOLDING: Fitch Affirms LongTerm IDR at 'BB-', Outlook Stable
PBF LOGISTICS: Fitch Affirms LongTerm IDR at 'BB-', Outlook Stable
PETROLIA ENERGY: Swings to $1.9 Million Net Income in 2021
PHOENIX GUARANTOR: Moody's Affirms B2 CFR, Outlook Remains Stable
PLASKOLITE PPC II: Moody's Lowers CFR & First Lien Term Loan to B3
PREMIER GRILLING: Seeks Cash Collateral Access
PUERTO RICO: HTA Plan Declared Effective
QUANERGY SYSTEMS: Case Summary & 20 Largest Unsecured Creditors
RADIOLOGY PARTNERS: S&P Alters Outlook to Neg., Affirms 'B-' ICR
REPLICEL LIFE: Hires Mao & Ying as New Auditor
REVERSE MORTGAGE: $124.5M DIP Loans from Leadenhall, TCB OK'd
SEI INSIEME: Case Summary & Two Unsecured Creditors
SONJA COLBERT: Awarded $41,269 in Attorney's Fees
THOMPSON ROSE: Trustee Gets OK to Tap Gabrielson & Co as Accountant
THREE ARROWS CAPITAL: Founders Not Helping With Recovery of Assets
TIMBER PHARMACEUTICALS: Regains Compliance With NYSE Listing Rule
TITAN INTERNATIONAL: S&P Upgrades ICR to 'B' on Deleveraging
TITLE PIPE: Taps Michael Tobiason of Azada CPA as Expert Witness
TRANSOCEAN LTD: Gets $1.04BB in Contract Awards for Two Drillships
TUFF TURF: Starts Subchapter V Bankruptcy Process
VBI VACCINES: Health Canada OKs PreHevbrio for Hepa B Prevention
VISION DEMOLITION: May Use Cash Collateral Thru Dec 19
VJGJ INC: KeySource's Bid to Dismiss Administrator's Appeal Granted
W.A. LYNCH: Wins Interim Cash Collateral Access
WALKER & DUNLOP: S&P Affirms 'BB' ICR, Outlook Stable
ZEOLI-BROWN LLC: Court OKs Final Cash Collateral Access
[*] Commercial Chapter 11 Bankruptcies Rose 74% in November 2022
*********
2377 NW KEARNEY: Taps Law Office of Conde Cox as Special Counsel
----------------------------------------------------------------
2377 NW Kearney, LLC received approval from the U.S. Bankruptcy
Court for the District of Oregon to employ the Law Office of Conde
Cox as special counsel.
The firm will represent the Debtor's interest in evaluating and
possibly objecting to and settling the claim of U.S. Bank, not in
its individual capacity, but solely as trustee of the Taenite Asset
Trust.
The firm will be paid at these rates:
Conde Cox, Attorney $495 per hour
Patricia Bowcock, Legal Assistant $100 per hour
The retainer fee is $6,000.
Conde Cox, Esq., a partner at the Law Office of Conde Cox,
disclosed in a court filing that the firm is a "disinterested
person" as the term is defined in Section 101(14) of the Bankruptcy
Code.
The firm can be reached at:
Conde Cox, Esq.
Law Office of Conde Cox
P.O. Box 1379
Ashland, OR 97520
Tel: (541) 944-7788
Email: conde@lawofficeofcondecox.com
About 2377 NW Kearney
2377 NW Kearney, LLC, a company in Portland, Ore., filed a Chapter
11 petition (Bankr. D. Ore. Case No. 22-31209) on July 26, 2022,
with between $1 million and $10 million in both assets and
liabilities. Jacqueline Alexander, a member of 2377 NW Kearney,
signed the petition.
Judge David W. Hercher oversees the case.
The Law Offices of Keith Y. Boyd and the Law Office of Conde Cox
serve as the Debtor's bankruptcy counsel and special counsel,
respectively.
243 FOOD: Wins Interim Cash Collateral Access
---------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized 243 Food LLC to use cash collateral on an interim basis
in accordance with the budget.
Specifically, the Debtor is permitted to continue using the cash
collateral of Associated Supermarket Group, LLC and AFS Capital,
LLC to pay for:
a. Purchase of product;
b. Non-insider payroll up to the statutory cap as set out in
11 U.S.C. Section 507(a) for each employee and payroll taxes;
c. Post-petition rent;
d. Post-petition utility payments;
e. insurance;
f. refrigeration maintenance;
g. pest control;
h. supplies; and
i. security.
As adequate protection, ASG is granted a replacement lien and
administrative claim for the amounts utilized by the Debtor.
The Court said no payment for reimbursement of employee expenses
will exceed the sum of $500.
A further hearing on the matter is set for December 22, 2022 at 12
noon.
A copy of the order is available at https://bit.ly/3WcdMQB from
PacerMonitor.com.
About 243 Food LLC
243 Food LLC operates a retail supermarket. The Debtor sought
protection under Chapter 11 of the U.S. Bankruptcy Code (Bankr.
E.D.N.Y. Case No. 22-42912) on November 22, 2022. In the petition
signed by Mazen A. Dayem, manager, the Debtor disclosed up to $10
million in both assets and liabilities.
Judge Elizabeth S. Stong oversees the case.
Marc A. Pergament, Esq., at Weinberg, Gross & Pergament, LLP, is
the Debtor's legal counsel.
5 SHORE DRIVEKP: Files for Chapter 11; Lender Seeks Stay Relief
---------------------------------------------------------------
5 Shore DriveKP Inc filed for chapter 11 protection in the Eastern
District of New York.
According to court filings, 5 Shore DriveKP Inc estimates between
$1 million to $10 million in debt owed to 1 to 49 creditors. The
petition states that funds will not be available to unsecured
creditors.
After the Chapter 11 filing, Tolbex, Inc., immediately filed with
the Bankruptcy Court a motion for relief from stay to permit a
foreclosure sale to proceed with respect to the property known as 5
Shore Drive, Kings Point, New York 11024 as ordered by in the
matter entitled Tolbex Inc. v. Philip J. Kassover, et al., Supreme
Court of the State of New York, County of Nassau, Index No.
608831/2019.
The Debtor is a corporate entity that was formed last week for the
sole purpose of thwarting the foreclosure sale. The Estate of
Kassover, which has owned the property throughout the state court
foreclosure proceedings, applied to the state court for a stay of
the auction. The state court denied the motion. After losing in
state court, Philip Kassover, as executor of the estate of
Kassover, transferred the deed to 5 Shore Drive KP, Inc., a newly
formed entity. Immediately after the transfer of the deed, 5 Shore
Drive KP, Inc., filed a bankruptcy petition.
Tolbex's counsel, Brian S. Cohen of Lachtman Cohen P.C., tells the
Bankruptcy Court that Kassover's transfer of the deed, as executor
of the estate of Kassover, to a newly-formed entity that he
controls, for the clear purpose of thwarting the foreclosure sale,
is unquestionably a fraudulent transfer with the actual intent to
hinder and delay the estate’s creditors, including Tolbex. See
First Franklin Fin. Corp. v. Merchant, 188 A.D.3d 564, 132 N.Y.S.3d
635 (1st Dept. 2020) (finding that, under New York state law, the
"purported transfer of the property for $10, on the eve of a
foreclosure sale, to a brand new entity that he created and caused
to commence a Chapter 11 proceeding just a few hours before the
foreclosure sale, bore all the badges of fraud necessary to
conclude that the transfer was fraudulent" as to the lender).
Because the transfer of the property is void ab initio, Tolbex
avers that the Bankruptcy Court should permit the foreclosure sale
to go forward because the property is not part of the Debtor's
bankruptcy estate.
About 5 Shore DriveKP
5 Shore DriveKP Inc. filed a petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-73422) on Dec.
2, 2022. In the petition filed by Philip J. Kassovev, as
president, the Debtor reported assets between $1 billion and $10
billion and liabilities between $1 million and $10 million.
575 BOULEVARD LLC: SARE Files for Chapter 11 Bankruptcy
-------------------------------------------------------
575 Boulevard LLC filed for chapter 11 protection in the Middle
District of Georgia without stating a reason.
The Debtor, a Single Asset Real Estate, says its principal asset is
located at 575 Boulevard S.E. Atlanta, GA 30312.
According to court filings, 575 Boulevard LLC estimates between
$500,000 and $1 million in debt owed to 1 to 49 creditors. The
petition states that funds will be available to unsecured
creditors.
The Debtor's manager, Jeffrey L. Wilson, earlier filed for
bankruptcy protection on Sept. 1, 2022 (Bankr. M.D. Ga. Case No.
22-70741).
About 575 Boulevard LLC
575 Boulevard LLC is a Single Asset Real Estate (as defined in 11
U.S.C. Sec. 101(51B)).
575 Boulevard LLC filed a petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. M.D. Ga. Case No. 22-71057) on Dec. 5,
2022. In the petition filed by Jeffrey L. Wilson, as manager, the
Debtor reported assets between $500,000 and $1 million and
liabilities between $1 million and $10 million.
The Debtor is represented by:
Gregory D. Taylor, Esq
Stone & Baxter, LLP
103 N Bartow St
Nashville, GA 31639
772 & 720 HOLDING: Court OKs Deal on Cash Collateral Access
-----------------------------------------------------------
The U.S. Bankruptcy Court for the Eastern District of New York
authorized 772 & 720 Holding LLC to use cash collateral on an
interim basis in accordance with its agreement with Fairview
Investment Fund V, LPC.
The Debtor requires the use of cash collateral for the continued
operation of the Debtor's business and the preservation of the
Debtor's estate.
The Debtor entered into a $7.518 million loan transaction with
Corevest pursuant to a Loan Agreement (Non-Revolving Credit
Facility) dated March 5, 2019, and Consolidated, Modified, Extended
and Restated Mortgage Note dated March 5, 2019.
The Debtor's obligations under the Note and Loan Agreement are
secured by, among other things, first priority liens on
substantially all of the Debtor's property.
On August 27, 2019, due to, inter alia, the Debtor's default in
payments due under the Loan Documents, Corevest provided notice to
the Debtor that the indebtedness under the Note was accelerated and
immediately due and payable.
On September 6, 2019, Corevest commenced a foreclosure action in
the Supreme Court for the State of New York, County of Kings. On
January 8, 2020, the State Court appointed Edward A. Vincent as
Temporary Receiver of the Properties.
Since the commencement of the Foreclosure Action, the Debtor has
granted four additional mortgages on the Properties:
i. a mortgage to 772 59 Lender, LLC in the principal amount of
$380,000, recorded September 6, 2019, in the Office of the City
Register of the City of New York under CRFN 2019000285464;
ii. a mortgage to Peggy Suen in the principal amount of
$100,000, recorded April 1, 2020, in the NYC Register under CRFN
2020000114083;
iii. a mortgage to Ann Cheng in the principal amount of
$860,000, recorded April 29, 2020, in the NYC Register under CRFN
2020000134930; and
iv. a mortgage to Yolanda Cheng in the principal amount of
$490,000, recorded May 1, 2020, in the NYC Register under CRFN
2020000137120. The principal amount of the Subordinated Mortgages
totals $1,450,000 in the aggregate.
By Assignment of Mortgage dated March 31, 2021, Corevest
transferred to Fairview Investment Fund V, LP all of its right,
title and interest in and to, inter alia, the Note and Mortgage.
Since March 31, 2021, interest has continued to accrue under the
Loan Documents.
Fairview holds valid, binding, and perfected liens on and security
interests in all of the Collateral.
Fairview asserts that as of September 9, 2022, the indebtedness
owed under the Loan Documents was $10.347 million, consisting of
principal in the amount $7.286 million, and accrued regular and
default interest totaling $3.061, and per diem interest was
continuing to accrue in the amount of $2,834 for each day
thereafter.
The Debtor is permitted to use cash collateral in accordance with
the budget, with a 10% variance, through January 11, 2023.
As an express condition of Fairview's consent to the use of cash
collateral, the Debtor will engage by no later than December 9,
2022, Signature Management Associates, which will be responsible
for the duties as set forth in the Agreed Section 543 Order.
In exchange for the continued use of cash collateral, and as
adequate protection for the Fairview's interests therein, the
Debtor will make monthly payments by the fifth day of each month to
Fairview equal to the greater of (i) $30,000, or (ii) an amount
equal to the rent collected in the prior month, less the expenses
paid in the prior month. Fairview will apply such payments first to
the accrued interest, and then to unpaid late charges, and then to
unpaid legal fees and costs, and then to the principal balance;
provided, that the Debtor reserves the right to seek the
reallocation of the application of adequate assurance payments if
the Fairview Prepetition Obligations are determined to be
undersecured.
In further adequate protection, Fairview is granted senior security
interests in, and liens upon, to attach to the same validity,
extent, and priority that Fairview Prepetition Liens possessed on
the Petition Date, but only to the extent the amount of their
respective secured position erodes in value post-petition, all
personal property and real estate now owned, or hereafter created
or acquired or generated by the Debtor.
As further adequate protection, Fairview will have allowed
administrative expense claims senior to any and all other
administrative expense claims to the extent of post-petition
Diminution in Value, if any, except with respect to the Carve
Outs.
The Replacement Liens and any priority to which Fairview may be
entitled or become entitled under Bankruptcy Code section 507(b)
will be forever subject to
a. amounts payable pursuant to 28 U.S.C. section 1930(a)(6),
together with interest, if any, pursuant to 31 U.S.C. section 3717,
and any fees payable to the Clerk of the Court;
b. liens for taxes owed to governmental entities to the extent
such liens have priority over the Replacement Liens under
applicable nonbankruptcy law;
c. fees and expenses of a chapter 7 trustee, should one be
appointed, however, not to exceed the amount of $20,000; and
d. the allowed administrative claims of attorneys and other
professionals retained by the Debtor in the chapter 11 case
pursuant to Bankruptcy Code section 327 accrued during the Interim
Period, in the aggregate amount of $20,000 for the Interim Period
only.
The final hearing on the matter is set for January 11 at 10 a.m.
A copy of the order is available at https://bit.ly/3uJIepp from
PacerMonitor.com.
About 772 & 720 Holding
772 & 720 Holding LLC is a Single Asset Real Estate (as defined in
11 U.S.C. Sec. 101(51B)).
772 & 720 Holding LLC filed a petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 22-42435) on Sept.
30, 2022. In the petition filed by Bao Zhi Liu, as managing member,
the Debtor reported between $10 million and $50 million in both
assets and liabilities.
Judge Jil Mazer-Marino oversees the case.
The Debtor is represented by Kirby Aisner & Curley, LLP.
96 WYTHE: Trustee Plan Relies on BSP Deal, Sale
-----------------------------------------------
Stephen S. Gray, not individually but solely in his capacity as the
Chapter 11 trustee for the bankruptcy estate of 96 Wythe
Acquisition LLC, submitted a Chapter 11 plan of liquidation and a
corresponding Disclosure Statement.
The Plan is based upon the BSP Settlement Agreement and provides
for the distribution to holders of allowed claims against the
Debtor of all available cash, consisting of the aggregate net
proceeds of the Estate's assets, including proceeds of retained
causes of action, after taking into account payments necessary to
satisfy Allowed Administrative Claims and Priority Claims for the
Plan to go effective. Whether the Debtor obtains sufficient cash
for the Plan to go effective depends upon the amount of the
proceeds of the sale. The Trustee believes that the Estate holds
colorable claims and causes of action with respect to certain of
the Debtor's Professional Persons and that the fees and expenses
requested by such Professional Persons may be subject to
disallowance by the Bankruptcy Court.
In the event the Debtor lacks sufficient cash to make the payments
to Allowed Administrative Claims and Allowed Priority Claims
necessary for the Plan to go effective, the Trustee may withdraw
the Plan and seek to close the proposed sale on a standalone basis
pursuant to section 363 of the Bankruptcy Code and as approved by
the Bankruptcy Court.
The Debtor's primary asset is the Hotel. Since his appointment,
the Trustee has managed the Hotel and other estate assets, and
moved to reject the Management Agreement, which motion was granted
by the Bankruptcy Court on August 8, 2022.
Prepetition, on Dec. 13, 2017, the Debtor and Benefit Street
Partners Realty Operating Partnership, L.P. (together with BSPRT
2018-FL3 Issuer, Ltd., as successor, collectively, "BSP") entered
into a $68 million loan transaction, which consolidated 14
mortgages. In the chapter 11 case, on July 13, 2021, BSP filed a
Proof of Claim, as amended, asserting a secured claim in the
aggregate amount of at least $89,543,755 on account of unpaid
principal, as well as accrued and accruing interest, fees, and
expenses related to the Loan Agreement.
On Sept. 13, 2022, the Trustee filed a motion to approve the BSP
Settlement Agreement, which, once approved, would quantify the
amount of the largest claim asserted against the Debtor's Estate,
and pave the way for a more streamlined Sale and Plan process,
including the capping of any credit bid by BSP to the amount of its
Senior Secured Claim. The BSP Settlement also resolved the
proposed treatment of BSP's Secured Claim by permitting the
consensual subordination of the BSP Subordinated Secured Claim to
Allowed General Unsecured Claims under the Plan. Moreover, the BSP
Settlement resolved, through dismissal, the adversary proceeding
filed by the Debtor against BSP, seeking to relitigate the
otherwise dispositively resolved Foreclosure Action.
In summary, the BSP Settlement Agreement apportions BSP's Claim
into two component parts: (i) the BSP Senior Secured Claim; and
(ii) the BSP Subordinated Secured Claim. Moreover, the BSP
Settlement Agreement affords BSP the right to credit bid the full
amount of its Senior Secured Claim at the Sale of the Hotel and
related Assets pursuant to section 363(k) of the Bankruptcy Code.
The BSP Settlement Agreement also identified certain terms and
conditions to be included in the Plan, discussed in Section VI of
this Disclosure Statement. Furthermore, the BSP Settlement
Agreement provides for BSP to assign all of its rights, title, and
interest in, and to, the bond posted by the Receiver for the Debtor
in the Foreclosure Action, and the rights to make a claim and
recover thereunder; provided, that BSP shall retain its right to
receive a Distribution of the proceeds of such bond to the extend
flowing to BSP on account of the BSP Subordinated Secured Claim.
The BSP Settlement Agreement also provides for mutual releases
between the Trustee and BSP for all claims and causes of action
relating to or arising out of, among other things, the BSP
Adversary Proceeding, the Loan, the Hotel, the Bankruptcy Case, the
Collateral (as defined in the Settlement Agreement), the
Foreclosure Action, and the Debtor's appeal of the Foreclosure
Action.
On Oct. 7, 2022, Debtor's co-counsel, Mayer Brown LLP filed a
limited objection to the Trustee's motion to approve the BSP
Settlement Agreement, arguing that the BSP Settlement Agreement
prematurely assumed that BSP was over-secured, and that the BSP
Settlement Agreement did not abide by the Bankruptcy Code's
priority scheme. The Trustee and BSP each filed replies to Mayer
Brown LLP's objection on Oct. 14, 2022, to which Mayer Brown LLP
filed a sur-reply on Oct. 17, 2022.
On Oct. 19, 2022, following discussions among the Trustee, BSP and
Mayer Brown, the Trustee filed a notice of a revised settlement
agreement between the Trustee and BSP. The revisions to the BSP
Settlement Agreement included additional language clarifying that
the BSP Secured Claim would be "reduced dollar for dollar by any
amount that such claim exceeds the amount permitted by [s]ection
506(b) of the Bankruptcy Code, which shall be determined based upon
a valuation of [BSP]'s Collateral established by a sale thereof
that is approved by the Bankruptcy Court or other recoveries on
account of such Collateral" and that "the [BSP Subordinated Secured
Claim] shall be reduced dollar for dollar by any amount that the
sum of the [BSP Senior Secured Claim] and [BSP Subordinated Secured
Claim] exceeds the amount permitted by [s]ection 506(b) of the
Bankruptcy Code, which shall be determined based upon a valuation
of [BSP]'s Collateral established by a sale thereof that is
approved by the Bankruptcy Court or other recoveries on account of
such collateral."
Following the filing of the notice of a revised settlement
agreement, Mayer Brown withdrew its objection and, at a hearing
held on Oct. 19, 2022, the Bankruptcy Court granted the motion to
approve the BSP Settlement Agreement and entered the BSP Settlement
Agreement Order on Oct. 21, 2022.
The Trustee, in an exercise of his business judgment, concluded
that a sale of the assets of the Debtor's Estate was in the best
interest of the its creditors and other stakeholders. Accordingly,
the Trustee has undertaken various steps to sell the Hotel and
related assets, including the retention of brokers, the
establishment of bidding procedures, and the initiation of a sale
process that can be consummated either pursuant to the Plan or, in
the alternative, on a stand alone basis pursuant to Section 363 of
the Bankruptcy Code.
Total General Unsecured Claims asserted against the Debtor's estate
aggregate $9.7 million. Based on the investigations and analyses
conducted by the Trustee and his professionals to date, it is
currently anticipated that Allowed General Unsecured Claims will
not exceed $1 million to $3 million in the aggregate.
Under the Plan, holders of Class 4 General Unsecured Claims will
receive one or more distributions of cash in an amount up to, but
not to exceed, the Allowed amount of such General Unsecured Claim.
Distributions in satisfaction of Allowed General Unsecured Claims
shall be made on a Pro Rata basis from the Net Available Cash.
Class 4 is impaired.
The primary source of funding the distributions and payments
required to be made under the Plan shall be the Gross Sale Proceeds
generated by the Sale of the Debtor's Hotel and related Assets.
Additionally, the net proceeds, if any, resulting from the possible
prosecution of the Retained Causes of Action by the Trustee or the
Plan Administrator, as the case may be, on behalf of the Debtor's
Estate shall serve as an additional source of funding Distributions
to holders of the Allowed BSP Subordinated Secured Claim and
Allowed General Unsecured Claims.
The Trustee or the Plan Administrator, as the case may be, may seek
to close the Chapter 11 Case and be discharged at such time as (i)
all of the Assets have been distributed pursuant to the Plan, (ii)
the Trustee or the Plan Administrator, as the case may be,
determines, in his or her sole discretion, that the administration
of any remaining Assets is not likely to yield sufficient
additional Available Cash to justify further pursuit, or (iii) all
Distributions required to be made by the Trustee or the Plan
Administrator, as applicable, under the Plan have been made. If at
any time the Trustee or the Plan Administrator, as applicable,
determines in reliance upon such professionals as they may retain
that the expense of administering the Plan and the Debtor's Estate
so as to make a final Distribution to holders of Allowed Unsecured
Claims is likely to exceed the value of the Assets remaining in the
Estate, the Trustee or the Plan Administrator may apply to the
Bankruptcy Court for authority to (x) reserve any amount necessary
to seek and obtain an Order of the Bankruptcy Court closing the
Chapter 11 Case and discharging the Trustee and/or the Plan
Administrator, (y) donate any balance to a charitable organization
(A) described in section 501(c)(3) of the IRC, (B) exempt from
United States federal income tax under section 501(a) of the IRC,
(C) not a "private foundation," as defined in section 509(a) of the
IRC, and (D) that is unrelated to the Debtor, the Trustee, and any
insider of the Liquidating Trust, and (z) close the Chapter 11
Case.
Counsel to Stephen S. Gray, not individually, but solely in his
capacity as Chapter 11 Trustee:
Albert Togut, Esq.
Neil Berger, Esq.
Frank A. Oswald, Esq.
Bryan M. Kotliar, Esq.
TOGUT, SEGAL & SEGAL LLP
One Penn Plaza, Suite 3335
New York, NY 10119
Tel: (212) 594-5000
A copy of the Disclosure Statement dated Dec. 2, 2022, is available
at https://bit.ly/3VNXInT from PacerMonitor.com.
About 96 Wythe Acquisition
96 Wythe Acquisition, LLC operates the Williamsburg Hotel, an
eight-story hotel located at 96 Wythe Ave., Brooklyn, N.Y.
96 Wythe Acquisition sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. S.D.N.Y. Case No. 21-22108) on Feb. 23,
2021, disclosing zero assets and $79,990,206 in liabilities. CRO
David Goldwasser signed the petition.
Judge Sean H. Lane oversees the case.
The Debtor tapped Backenroth Frankel & Krinsky, LLP and Mayer
Brown, LLP as bankruptcy counsels; Fern Flomenhaft, PLLC as
insurance counsel; and B. Riley Advisory Services as litigation
support consultant. Getzler Henrich & Associates, LLC and Hilco
Real Estate, LLC serve as the Debtor's financial advisors.
Stephen Gray was appointed as Chapter 11 trustee. The trustee
tapped Togut, Segal & Segal, LLP; Fragomen Del Rey Bernsen & Loewy,
LLP; and Bernstein Redo & Savitsky PC as bankruptcy counsel,
special counsel, and special liquor license counsel, respectively.
Verdolino & Lowey PC is the trustee's tax accountant.
A CAB SERIES: Case Summary & Nine Unsecured Creditors
-----------------------------------------------------
Debtor: A Cab, Series L.L.C.
f/k/a A Cab, LLC
1500 Searles Avenue
Las Vegas, NV 89101
Business Description: The Debtor operates a taxi service business.
Chapter 11 Petition Date: December 12, 2022
Court: United States Bankruptcy Court
District of Nevada
Case No.: 22-14361
Judge: Hon. Natalie M. Cox
Debtor's Counsel: Matthew C. Zirzow, Esq.
LARSON & ZIRZOW, LLC
850 E. Bonneville Ave.
Las Vegas, NV 89101
Tel: 702-382-1170
Email: mzirzow@lzlawnv.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Creighton J. Nady as manager.
A full-text copy of the petition containing, among other items, a
list of the Debtor's nine unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/AN6V2XI/A_CAB_SERIES_LLC__nvbke-22-14361__0001.0.pdf?mcid=tGE4TAMA
ACER THERAPEUTICS: Nets $4.1 Million From Recent Common Stock Sale
------------------------------------------------------------------
Acer Therapeutics Inc. entered into a sales agreement on Nov. 9,
2018, with Roth Capital Partners, LLC, and on March 18, 2020, an
amended and restated sales agreement was entered into with
JonesTrading Institutional Services LLC and Roth Capital Partners,
LLC. The agreement provides a facility for the offer and sale of
shares of common stock from time to time having an aggregate
offering price of up to $50.0 million depending upon market demand,
in transactions deemed to be an at-the-market offering. As
reported in the Company's quarterly report on Form 10-Q for the
quarterly period ended Sept. 30, 2022, as of Sept. 30, 2022, $36.2
million remained available under the Company's ATM Facility,
subject to various limitations.
Since Sept. 30, 2022, the Company has sold an additional 1,858,757
shares of common stock at an average price per share of $1.44 under
the ATM Facility, with gross proceeds of approximately $2.7
million, and net proceeds of approximately $2.6 million. Following
the settlement of the most recent sale under the ATM facility, the
Company will have 19,511,876 shares outstanding as of Dec. 8, 2022.
The Company said the net proceeds from these recent sales under
the ATM facility, combined with the proceeds received by the
Company from its sale of 1,229,508 shares of common stock in a
private placement on Dec. 2, 2022 with proceeds to the Company of
approximately $1.5 million, and together with the Company's
existing cash and cash equivalents, are expected to be sufficient
to fund the Company's anticipated operating and capital requirement
into early Q1 2023.
About Acer Therapeutics
Acer Therapeutics Inc. -- http://www.acertx.com-- is a
pharmaceutical company focused on the acquisition, development and
commercialization of therapies for serious rare and
life-threatening diseases with significant unmet medical needs.
Acer's pipeline includes four investigational programs: ACER-001
(sodium phenylbutyrate) for treatment of various inborn errors of
metabolism, including urea cycle disorders (UCDs) and Maple Syrup
Urine Disease (MSUD); ACER-801 (osanetant) for treatment of induced
Vasomotor Symptoms (iVMS); EDSIVO (celiprolol) for treatment of
vascular Ehlers-Danlos syndrome (vEDS) in patients with a confirmed
type III collagen (COL3A1) mutation; and ACER-2820 (emetine), a
host-directed therapy against a variety of viruses, including
cytomegalovirus, zika, dengue, ebola and COVID-19.
Acer Therapeutics reported a net loss of $15.37 million for the
year ended Dec. 31, 2021, compared to a net loss of $22.89 million
for the year ended Dec. 31, 2020. As of Sept. 30, 2022, the
Company had $15.32 million in total assets, $27.53 million in total
liabilities, and a total stockholders' deficit of $12.21 million.
Boston, MA-based BDO USA, LLP, the Company's auditor since 2019,
issued a "going concern" qualification in its report dated March 2,
2022, citing that the Company has recurring losses and negative
cash flows from operations that raise substantial doubt about its
ability to continue as a going concern.
AIBUY HOLDCO: Targets Mid-February Hearing on Plan
--------------------------------------------------
AiBUY Holdco, Inc., et al., submitted an amended motion for an
order approving the Disclosure Statement on a final basis,
scheduling a plan confirmation hearing, approving the solicitation
procedures and dates, deadlines, and notices related thereto, and
granting related relief.
A hearing will be conducted on this matter on Jan. 9, 2023, at 9:30
am, before the Honorable Stacey G.C. Jernigan, in the Earle Cabell
Federal Building, 1100 Commerce Street, Dallas, Texas 75242-1496.
Objections must be filed within 28 days from the date served with
pleading.
In connection with the foregoing, the Debtors request that the
Court approve the following solicitation and confirmation
schedule:
* The voting record date will be on January 9, 2023.
* Solicitation will commence on January 9, 2023.
* The voting and opt-out deadline will be on January 31, 2023.
* The Plan Supplement deadline will be on January 31, 2023.
* The deadline to file a reply brief and confirmation brief
will be on February 13, 2023.
* The confirmation hearing Date will be on February 15, 2023 at
9:30 AM.
The Plan is supported by Stinv - Stocks Investment Limited ("Stinv"
or the "DIP Lender"), the Debtors' largest prepetition lender,
majority shareholder, and the Court-approved interim DIP lender.
In its capacity as DIP Lender, Stinv has agreed to provide the
Debtors with secured postpetition financing necessary to maintain
the Debtors' operations during the pendency of the Debtors' chapter
11 cases pursuant to the terms and conditions of that certain
Debtor-in-Possession Loan and Security Agreement, and pursuant to
an agreed budget. The DIP Loan Agreement, entered into by the
Debtors and Stinv, in its capacity as DIP Lender, postpetition,
provides, among other things, milestones for its support of an
expedited resolution of these Chapter 11 Cases.
The Plan negotiated by the Debtors and Stinv contemplates (1) the
satisfaction of all of the Debtors' outstanding unsecured
indebtedness owed to non- Stinv parties, including approximately
$5.4 million owed to various lenders through a series of
Convertible Note Purchase Agreements and approximately $2.3
million, in the aggregate, in outstanding unsecured trade
liabilities (to the extent such claims are allowed), (2) Stinv
providing approximately $6 million in new-money exit financing to
fund the Debtors' businesses in and upon emergence from chapter 11,
(3) Stinv receiving 100 percent of the New Common Equity of the
Reorganized Debtors, and (4) a minimization of the time and
administrative costs associated with the Debtors' Chapter 11 Cases.
The restructuring contemplated by the Plan will (1) provide the
Debtors with the opportunity to take advantage of an efficient
chapter 11 process, (2) allow the Debtors to implement a balance
sheet restructuring that addresses the Debtors' near-term
liquidity, (3) give the Debtors the ability to strengthen their
operations and financial conditions through a significant
de-leveraging, and (4) provide the Debtors' with sufficient capital
to maintainer their business operations without interruption during
the pendency of these Chapter 11 Cases, (5) preserve the
going-concern value of the Debtors' businesses, and (6) ensure that
the Debtors have sufficient liquidity to make plan distributions
and successfully operate their business upon emergence.
As the ultimate goal of the restructuring contemplated by the Plan
is to maximize the value of the Debtors' business and ensure a
going concern, it is critical that the Debtors emerge from chapter
11 as expeditiously as possible and in a timely manner with a
de-levered balance sheet. By this motion, the Debtors request
authority to proceed on the accelerated, but orderly timeline,
which will allow the Debtors to move these Chapter 11 cases to the
expeditious resolution contemplated by the DIP Loan Agreement and
the Plan and ensure the Debtors' operations obtain the other
benefits contemplated by the Plan.
Counsel to Debtors:
Holland N. O'Neil, Esq.
Mark C. Moore, Esq.
Stephen A. Jones, Esq.
FOLEY & LARDNER LLP
2021 McKinney Avenue, Suite 1600
Dallas, TX 75201
Telephone: (214) 999-3000
Facsimile: (214) 999-4667
E-mail: honeil@foley.com
mmoore@foley.com
sajones@foley.com
About Aibuy Holdco
Based in Texas, AiBUY Inc., also known as Cinsay Inc.
[www.aibuy.io], enables a frictionless in-content shopping
experience across the digital ecosystem. With 82 granted patents,
the overlay technology powers an end-to-end e-commerce solution.
AiBUY has integrated with leading e-commerce platforms such as
Shopify, Salesforce, Magento and more, to power shoppable
experiences for clients across sports, entertainment and lifestyle
industries.
An involuntary Chapter 11 petition has been filed against Aibuy
Holdco Inc. (Bankr. N. Texas, Case No. 22-31737) on Sept. 23, 2022.
The petitioners who assert $2.2 million in claims against the
Debtor are Jon Gunderson, John Kutasi and Deposit Inc. The
petitioners' counsel is Katten Muchin Rosenman, LLP.
On Nov. 1, 2022, AiBUY Opco, LLC filed a voluntary petition for
Chapter 11 protection (Bankr. N. Texas, Case No. 22-32077). The
case is jointly administered with Aibuy Holdco's Chapter 11 case.
Judge Stacey G. Jernigan oversees both cases.
The Debtors tapped Foley & Lardner, LLP as legal counsel; CR3
Partners, LLC as restructuring advisor; and Stretto, Inc. as claims
and noticing agent. Greg Baracato, a partner at CR3 Partners,
serves as the Debtors' chief restructuring officer.
ALCON CONTRACTORS: Court Confirms Reorganization Plan
-----------------------------------------------------
Judge Craig A. Gargotta has entered an order confirming the Chapter
11 Plan of Reorganization filed by Alcon Contractors LLC on Oct.
19, 2022.
Notwithstanding the terms of the Debtor's Plan, the following
provisions will be deemed to apply in this case:
a. The proofs of claim filed with the Court as of July 18, 2022,
shall be deemed allowed as filed;
b. With respect to creditors shown on Schedules E/F of the
Debtor's Schedules which did not file proofs of claim, were
scheduled with an amount due and owing, but were not scheduled as
holding a contingent, unliquidated or disputed claim, such
creditors' claims shall be deemed allowed as scheduled by the
Debtor. The following creditors' claims are hereby disallowed:
creditors shown on Schedules E/F which: (1). did not file a proof
of claim, AND (2). were listed as holding either a contingent,
unliquidated or disputed claim, or were listed with an "unknown" or
"$0.00" amount due.
c. By agreement with the Trustee, Debtor shall have 60 days from
the Effective Date of the Plan to file objections to proofs of
claim.
Alcon Contractors LLC submitted an Amended Plan Of Reorganization
dated Oct. 19, 2022. This Plan of Reorganization under chapter 11
of the Bankruptcy Code proposes to pay creditors of the Debtor
from cash flow generated by net income generated by the operation
of Debtor's business. The Debtor plans to pay-off 10% of its
existing general unsecured creditor liabilities. All allowed
administration expenses, secured claims and priority unsecured
claims will be paid in full. Non-priority unsecured creditors
holding allowed claims will receive distributions, which the
proponent of this Plan has valued at approximately seven cents on
the dollar.
Attorney for the Debtor:
Morris E. "Trey" White III, Esq.
VILLA & WHITE LLP
1100 NW Loop 410 #700
San Antonio, TX 78213
Tel: (210) 225-4500
Fax: (210) 212-4649
E-mail: treywhite@villawhite.com
A copy of the Order dated Dec. 2, 2022, is available at
https://bit.ly/3B6DaiF from PacerMonitor.com.
About Alcon Contractors
Alcon Contractors -- https://www.alconcontractorstx.com/ -- is a
leader in the field for quality construction.
Alcon Contractors LLC sought Chapter 11 bankruptcy protection
(Bankr. W.D. Tex. Case No. 22-50498) on May 9, 2022. In the
petition filed by Mark Garcia, as manager, Alcon Contractors
reported assets up to $50,000 and estimated liabilities between $1
million and $10 million.
The case is overseen by Chief Bankruptcy Judge Craig A Gargotta.
Morris E. "Trey" White III, Esq., of VILLA & WHITE LLP, is the
Debtor's counsel.
ALEXANDER JONES: Sandy Hook Families Seek Stay Relief
-----------------------------------------------------
Family members of the Sandy Hook school shooting victims promptly
filed with the Texas bankruptcy court a motion to lift the
automatic stay in Alex Jones' bankruptcy case.
Neil Heslin and Scarlett Lewis (the "Texas Post-Trial Plaintiffs")
and David Wheeler, Francine Wheeler, Jacqueline Barden, Mark
Barden, Nicole Hockley, Ian Hockley, Jennifer Hensel, Donna Soto,
Carlee Soto Parisi, Carlos M. Soto, Jillian Soto-Marino, William
Aldenberg, William Sherlach and Robert Parker (the "Connecticut
Plaintiffs" and together with the Texas Post-Trial Plaintiffs, the
"Sandy Hook Post-Trial Families"), move for relief from the
automatic stay (this "Motion") pursuant to Section 362(d)(1) of
title 11 of the United States Code.
According to the Plaintiffs' attorneys, after more than four years
of litigation before courts in Texas and Connecticut and the recent
verdicts and punitive damages awarded in such cases, the Sandy Hook
Post-Trial Families are on the verge of having their judgments
entered against Jones and Free Speech Systems, LLC ("FSS").
But the automatic stay triggered by Alex Jones' recently filed
Chapter 11 case has -- for the third time this year -- needlessly
halted these actions. The first stay stemmed from the bankruptcy
cases commenced by Jones's shell companies, InfoW, LLC, IWHealth,
LLC and Prison Planet TV, LLC but the cases were dismissed.
Thereafter, an automatic stay again was imposed when FSS petitioned
for bankruptcy protection under subchapter V, but that stay was
lifted on a consensual basis. Now, with a third automatic stay
imposed by Jones' Chapter 11 Case, the Sandy Hook Post-Trial
Families ask that the automatic stay be lifted once again to allow
the underlying state court verdicts against Jones to proceed to
judgment and any subsequent appeal(s) he may pursue to move
forward.
Jones has asserted in the FSS Case that allowing FSS's and Jones's
individual appeals to go forward at different times is problematic.
The Sandy Hook Post-Trial Families disagree and will file their
objection at the appropriate time. Even if there were merit to
Jones's contention, however, the solution is to provide an
identical lift stay order in this Chapter 11 Case to those entered
in the FSS Case, such that both debtors' appeals may proceed
simultaneously.
"The Sandy Hook Post-Trial Families are the largest creditors of
both Jones and FSS and stand to recover virtually all of the value
of their respective estates. The verdicts and judicial punitive
damages awarded thus far total in excess of $1.5 billion. As such,
the Sandy Hook Post-Trial Families' view that proceeding to final
resolution in their underlying state court cases is a prudent use
of estate resources should receive overriding, if not dispositive,
weight," according to the Plaintiffs' motion.
"Jones and FSS wrongfully delayed inevitable judgments in the
underlying litigation by repeatedly engaging in sanctionable
conduct. Indeed, judgments should have been rendered years ago.
And as previewed during the December 7 status conference in this
Chapter 11 Case, the Sandy Hook Families believe their claims are
nondischargeable under Bankruptcy Code section 523 in both this
case and the FSS Case. Therefore, there is no reason to delay
entering judgments in the Sandy Hook Post-Trial Cases, which will
be unaffected by either bankruptcy case."
The Sandy Hook Post-Trial Families request that the automatic stay
be lifted (i) to allow the Sandy Hook Post-Trial Families' cases to
proceed to final judgment and (ii) once judgments are entered, to
allow appeals, if any, to proceed and the Sandy Hook Post-Trial
Families to respond and participate in any such appeals without
further order of the Court.
Bankruptcy Counsel for the Texas Plaintiffs:
CHAMBERLAIN, HRDLICKA, WHITE, WILLIAMS & AUGHTRY, PC
Jarrod B. Martin
Tyler W. Greenwood
1200 Smith Street, Suite 1400
Houston, Texas 77002
Tel: (713) 356-1280
Fax: (713) 658-2553
Email: jarrod.martin@chamberlainlaw.com
Bankruptcy Counsel for the Sandy Hook Families:
AKIN GUMP STRAUSS HAUER & FELD LLP
Marty L. Brimmage, Jr.
2300 N. Field Street, Suite 1800
Dallas, TX 75201
Tel: (214) 969-2800
Fax: (214) 969-4343
Email: mbrimmage@akingump.com
-and-
Ira S. Dizengoff
David M. Zensky
Philip C. Dublin
Sara L. Brauner
Katherine Porter
One Bryant Park
New York, NY 10036
Tel: (212) 872-1000
Fax: (212) 872-1002
Email: idizengoff@akingump.com
Email: dzensky@akingump.com
Email: pdublin@akingump.com
Email: sbrauner@akingump.com
Email: kporter@akingump.com
Bankruptcy Counsel for the Connecticut Plaintiffs:
CAIN & SKARNULIS PLLC
Ryan E. Chapple
303 Colorado Street, Suite 2850
Austin, Texas 78701
Tel: 512-477-5000
Fax: 512-477-5011
Email: rchapple@cstrial.com
Counsel for the Texas Plaintiffs:
McDOWELL HETHERINGTON LLP
Avi Moshenberg
1001 Fannin Street, Suite 2700
Houston, Texas 77002
Tel: (713) 337-5580
Fax: (713) 337-8850
Email: Avi.Moshenberg@mhllp.com
Creditors Committee Formed
Kevin M. Epstein, the United States Trustee for the Southern
District of Texas, on Dec. 13, 2022, filed documents indicating
that the has appointed the following eligible creditors to an
Official Committee of Unsecured Creditors in the Chapter 11 case of
Alex Jones:
1 Robert Parker
c/o Ryan Chapple
303 Colorado St., Suite 2850
Austin, TX 78701
ctp.robertparker@gmail.com
2 Nicole Hockley
c/o Ryan Chapple
303 Colorado St., Suite 2850
Austin, TX 78701
ctp.nicolehockley@gmail.com
3 Jennifer Hensel
c/o Ryan Chapple
303 Colorado St., Suite 2850
Austin, TX 78701
ctp.jenniferhensel@gmail.com
4 David Wheeler
c/o Ryan Chapple
303 Colorado St., Suite 2850
Austin, TX 78701
ctp.davidwheeler@gmail.com
5 Leonard Pozner
c/o Avi Moshenberg
1001 Fannin, Suite 2400
Houston, TX 77002
Leonard.pozner.tx@gmail.com
6 Scarlett Lewis
c/o Avi Moshenberg
1001 Fannin, Suite 2400
Houston, TX 77002
Scarlett.lewis.tx@gmail.com
About Alex Jones and
Free Speech Systems
Free Speech Systems LLC is a broadcast media production and
distribution company that provides broadcasting aural programs by
radio to the public. Free Speech Systems is a family-run business
founded by Alex Jones.
FSS is presently engaged in the business of producing and
syndicating Jones' radio and video talk shows and selling products
targeted to Jones' loyal fan base via the Internet. Today, FSS
produces Alex Jones' syndicated news/talk show (The Alex Jones
Show) from Austin, Texas, which airs via the Genesis Communications
Network on over 100 radio stations across the United States and via
the internet through websites including Infowars.com.
Conspiracy theorist Alex Jones has been sued by victims' family
members over Jones' lies that the 2012 Sandy Hook Elementary School
shooting was a hoax.
Jones' InfoW LLC and affiliates, IWHealth, LLC and Prison Planet
TV, LLC, filed petitions under Chapter 11, Subchapter V of the
Bankruptcy Code (Bankr. S.D. Texas Lead Case No. 22-60020) on April
18, 2022. The Debtors agreed to the dismissal of the Chapter 11
cases in June 2022 after the Sandy Hook victim families dismissed
the three bankrupt companies from their lawsuits.
Free Speech Systems filed a voluntary petition for relief under
Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex.
Case No. 22-60043) on July 29, 2022. In the petition filed by W.
Marc Schwartz, as chief restructuring officer, the Debtor reported
assets and liabilities between $50 million and $100 million.
Melissa A Haselden has been appointed as Subchapter V trustee.
Alexander E. Jones filed for personal bankruptcy under Chapter 11
of the Bankruptcy Code (Bankr. S.D. Tex. Case No. 4:22-bk-60043) on
Dec. 2, 2022, listing $1 million to $10 million in assets against
liabilities of $1 billion to $10 billion in liabilities.
Raymond William Battaglia, of Law Offices of Ray Battaglia, PLLC,
is FSS's counsel. Raymond W. Battaglia and Crowe & Dunlevy, P.C.,
led by Vickie L. Driver, Christina W. Stephenson, Shelby A. Jordan,
and Antonio Ortiz are representing Alex Jones.
AQUA SHIELD: Plan Confirmation Deadline Extended to March 6
-----------------------------------------------------------
Judge Jil Mazer-Marino has granted Aqua Shield, Inc., an extension
through and including March 6, 2023, of the time to obtain approval
of a Chapter 11 Small Business Disclosure Statement and to confirm
a Chapter 11 Small Business Chapter 11 Plan of Reorganization.
In seeking a fifth extension of the deadline, the Debtor explained
that throughout this bankruptcy case, the Debtor has worked
diligently and has complied with all administrative obligations
during the pendency of the case and has timely filed all Operating
Reports and paid quarterly fees.
This fifth request is not made for the purposes of delay. The
fifth requested extension of the time period for confirmation is
necessary, due to the fact that the time to confirm a plan is set
to expire on Dec. 6, 2022, but the Debtor needs additional time to
resolve the claim of Stephen Frampton and Korri Frampton in the
amount of $100,000 filed on May 19, 2022, and thereafter to amend a
plan and disclosure statement.
To date, the Debtor has made an offer and circulated the proposed
settlement agreement to the attorney for Stephen Frampton and Korri
Frampton. Upon completion of the settlement negotiations and
finalization of the terms of the settlement, the Debtor will file
an amended disclosure statement and plan of reorganization,
incorporating the terms of the settlement.
Attorney for the Debtor:
Alla Kachan, Esq.
LAW OFFICES OF ALLA KACHAN, P.C.
2799 Coney Island Avenue, Suite 202
Brooklyn, NY 11235
Tel: (718) 513-3145
About Aqua Shield
Aqua Shield, Inc., sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. E.D.N.Y. Case No. 20-73191) on Oct. 16,
2020. The case was eventually transferred to the appropriate office
under Case No. 20-43635. Judge Nancy Lord oversees the case.
At the time of the filing, the Debtor had estimated assets of
between $100,001 and $500,000 and liabilities of between $500,001
and $1 million.
The Debtor is represented by the Law Offices of Alla Kachan, P.C.
Bruce Arthur Lean, CPA serves as the Debtor's accountant.
ARETE REHABILIATION: Files Emergency Bid to Use Cash Collateral
---------------------------------------------------------------
Arete Rehabilitation, Inc. asks the U.S. Bankruptcy Court for the
District of Massachusetts, Eastern Division, for authority to use
cash collateral nunc pro tunc, to the Petition Date, in accordance
with the budget.
At the outset, the Debtor discloses that it has been using cash
collateral since the Petition Date, without Court approval. The
Debtor did so with the consent of the two secured creditors in the
case which are Bridge Capital-NewCo Capital Group VI, LLC and
Independence Bank, an SBA Lender. NewCo's counsel (Steven
Berkovitch in New York) consented on November 28, 2022 and
Independence Bank (through two employees with titles, Loan
Portfolio Managers) consented, pre-petition.
The Debtor's rationale for the delay in filing the motion was that
its budget was, up to now, inaccurate, incomplete and would likely
have been misleading if filed weeks ago. Significant effort has
been expended over the last several weeks concerning the Debtor's
cash flow and projected budget and the Debtor advised the UST and
Subchapter V Trustee of its ongoing efforts. Pursuant to Schedule
B, the outstanding receivables are well in excess of $300 million.
NewCo is owed approximately $128,431 and Independence Bank is owed
approximately $23,644, so each of them is oversecured, and
therefore entitled to replacement liens under section 361 rather
than ongoing payments.
As a result of the COVID-19 crisis, the Debtor has experienced a
significant decline in its business. The Debtor has been forced to
shutter its businesses in New Hampshire and Pennsylvania and lay
off employees. Primarily because of this recent decline in
business, the Debtor is unable to satisfy its obligations to its
creditors and pay employees.
The Debtor has determined that by streamlining its operations, it
will be able to adapt to the changing environment caused by the
COVID-19 virus, while focusing on its strengths -- providing
physical, occupational and speech therapy to a frail, elderly (over
65) population.
As of the Petition Date, the Debtor's principal assets consisted of
approximately $336,000 of receivables owed by various health
insurance vendors in the ordinary course of business. NewCo has a
pre-petition perfected UCC lien on the Debtor's receivables.
Independence Bank has a pre-petition perfected UCC lien on
receivables as well as hard assets, such as equipment, machinery,
etc.
NewCo and Independence Bank are the only creditors asserting
secured obligations against the Debtor - NewCo in the amount of
$128,431 and Independence Bank in the amount of $23,644. Both
creditors have been consulted and both have given consent to the
use of cash collateral from the beginning of the case and going
forward.
NewCo and Independence Bank are oversecured as they not only enjoy
an equity cushion with respect to the pre-petition receivables, but
their liens extend to receivables on a rolling basis, so at any
time, their security position is consistently replenished based on
the Debtor's billing for ongoing services.
A copy of the motion is available at https://bit.ly/3j22BvG from
PacerMonitor.com.
A copy of the budget is available at https://bit.ly/3hqrLDF from
PacerMonitor.com.
The budget provides for total disbursements, on a weekly basis, as
follows:
$13,547 for December 5, 2022;
$6,731 for December 12, 2022;
$4,353 for December 19, 2022; and
$1,371 for December 26, 2022.
About Arete Rehabilitation
Arete Rehabilitation, Inc. -- https://www.areterehab.com/ --
specializes in older adult care, Arete Rehab provides physical,
occupational, and speech therapy services in the northeast.
Arete Rehabilitation filed a petition for relief under Subchapter V
of Chapter 11 of the Bankruptcy Code (Bankr. D. Ma. Case No.
22-11661) on Nov. 15, 2022, with up to $1 million in assets and up
to $10 million in liabilities. James S. LaMontagne has been
appointed as Subchapter V trustee.
The Debtor filed a prior Chapter 11 Case in the U.S. Bankruptcy
Court for the District of New Hampshire on Sep 28, 2022 (Case No.
22-10477 -BAH) which was dismissed on Nov. 10, 2022.
Judge Christopher J Panos oversees the case.
The Debtor is represented by Joshua A. Burnett, Esq. at Amann
Burnett, PLLC.
BESTWALL LLC: Urges 4th Circuit to Overturn Georgia Pacific Stay
----------------------------------------------------------------
Rick Archer of Law360 reports that the asbestos claimants committee
in the Bestwall Chapter 11 asked a Fourth Circuit panel Tuesday,
Dec. 6, 2022, to overturn an injunction shielding Bestwall parent
Georgia-Pacific from their claims, saying the bankruptcy judge
overstepped the law when she issued the order.
Bestwall LLC was formed on July 31, 2017, as a result of a
corporate restructuring of Georgia-Pacific LLC ("Old GP").
Pursuant to a divisional merger under a Texas merger statute which
allows a single Texas entity to "merge" into two or more entities,
Old GP ceased to exist and two new entities were created (i)
Bestwall LLC, which received some assets and liabilities of Old GP,
including Old GP's asbestos liabilities; and (ii) Georgia-Pacific
LLC ("New GP"), which received all other assets and liabilities of
Old GP. The Debtor also agreed to indemnify New GP for any losses
it suffers relating to the Debtor's asbestos liabilities.
Bestwall LLC then filed a Chapter 11 bankruptcy case for the
purpose of resolving the asbestos-related claims against it by way
of a trust under Section 524(g) of the Bankruptcy Code. On the
same day the bankruptcy petition was filed, the Debtor filed an
adversary proceeding against plaintiffs and prospective plaintiffs
in asbestos-related actions against certain affiliated non-debtors
to enjoin pursuant to Section 105(a), the continuation or
commencement of any action against Georgia Pacific and other
non-debtors.
The Bankruptcy Court temporarily enjoined the asbestos-related
claims and then ultimately granted the motion for injunction. The
Bankruptcy Court concluded the entire purpose of the Debtor's
Chapter 11 bankruptcy case would be defeated if the litigation in
other forums continued against Georgia Pacific, and a Section
524(g) trust will provide all claimants with an efficient means to
equitably resolve their claims.
District Judge Robert J. Conrad, Jr., on Jan. 6, 2022, ruled that
the Bankruptcy Court did not abuse its discretion when balancing
the equities among the various interests, and affirmed the
Bankruptcy Court's preliminary injunction orders.
About Bestwall LLC
Bestwall LLC -- http://www.Bestwall.com/-- was created in an
internal corporate restructuring and now holds asbestos
liabilities. Bestwall's asbestos liabilities relate primarily to
joint systems products manufactured by Bestwall Gypsum Company, a
company acquired by Georgia-Pacific in 1965. The former Bestwall
Gypsum entity manufactured joint compounds containing small amounts
of chrysotile asbestos; the manufacture of these
asbestos-containing products ceased in 1977.
Bestwall's non-debtor subsidiary, GP Industrial Plasters LLC
("PlasterCo"), develops, manufactures, sells and distributes gypsum
plaster products, including gypsum floor underlayment, industrial
plaster, metal casting plaster, industrial tooling plaster, dental
plaster, medical plaster, arts and crafts plaster, pottery plaster
and general purpose plaster.
On Nov. 2, 2017, Bestwall sought Chapter 11 protection (Bankr.
W.D.N.C. Case No. 17-31795) in an effort to equitably and
permanently resolve all its current and future asbestos claims.
The Debtor estimated assets and debt of $500 million to $1 billion.
It has no funded indebtedness.
The Hon. Laura T. Beyer is the case judge.
The Debtor tapped Jones Day as bankruptcy counsel; Robinson,
Bradshaw & Hinson, P.A., as local counsel; Schachter Harris, LLP as
special litigation counsel for medicine science issues; King &
Spalding as special counsel for asbestos matters; and Bates White,
LLC, as asbestos consultants. Donlin Recano LLC is the claims and
noticing agent.
On Nov. 8, 2017, the U.S. bankruptcy administrator appointed an
official committee of asbestos claimants in the Debtor's case. The
Committee retained Montgomery McCracken Walker & Rhoads LLP as its
legal counsel, Hamilton Stephens Steele + Martin, PLLC and JD
Thompson Law as local counsel, FTI Consulting, Inc., as financial
advisor.
On Feb. 22, 2018, the court approved the appointment of Sander L.
Esserman as the future claimants' representative in its case. Mr.
Esserman tapped Young Conaway Stargatt & Taylor, LLP as his legal
counsel; Hull & Chandler, P.A. as local counsel; Ankura Consulting
Group, LLC as claims evaluation consultant; and FTI Consulting,
Inc., as financial advisor.
BOY SCOUTS: Ohio House Passes Bill to Help Abuse Survivors
----------------------------------------------------------
Haley BeMiller of Cincinnati Enquirer reports that the Ohio House
passed legislation Thursday, December 1, 2022, that would level the
playing field for Ohioans who were sexually abused by Boy Scout
leaders and want to seek financial relief from the organization.
The bill, introduced earlier this year by state Reps. Bill Seitz,
R-Cincinnati, and Jessica Miranda, D-Forest Park, stems from rules
laid out in the Boy Scouts of America's bankruptcy settlement. It
would scrap Ohio's civil statute of limitations for child sex abuse
in bankruptcy cases, allowing survivors to recoup the full amount
owed to them.
Boy Scouts of America filed for bankruptcy in 2020 as it faced
hundreds of lawsuits across the country from former scouts who said
they were molested and raped by leaders and volunteers. Nearly
2,000 abuse claims have been filed in Ohio alone.
The settlement, approved in September, allows survivors to apply
for a $3,500 expedited payout. Alternatively, survivors can pursue
an independent review or see where they fall on a matrix that doles
out money based on the severity and frequency of abuse. For those
two options, the state's statute of limitations is a key factor.
In Ohio, criminal charges for child sex abuse can be brought until
the victim turns 43, with another five years granted if DNA
evidence is found after that. Current law caps the civil statute of
limitations at age 30. Advocates say these laws are unfriendly to
child sex abuse victims, who often contend with memory loss and
don't come forward until decades after the fact.
Per the settlement rules, Ohio's current law would limit survivors
to 30% to 45% of what they're eligible for under the matrix. They
would not qualify for an independent review.
"How can just by the mere fact that one of us was born in Ohio and
had the misfortune to be sexually abused here, why should we
receive half or less of the same person who just had the misfortune
of being sexually abused in a different state?" said Eric Palmer, a
Cincinnati attorney who says he was sexually abused by an Ohio
scout leader.
The bill passed Thursday aims to change that and ensure all options
are available to Ohioans seeking relief.
"I want the Ohio claimants to be treated equitably with other
claimants," Seitz said on the House floor Thursday.
The settlement gave Ohio lawmakers until September of next year to
enact changes, and they're moving with urgency. The House expedited
the process by folding Seitz's and Miranda's proposal into an
unrelated bill dealing with guardianship and estate laws,
qualifications for judges and more.
It now moves to the Senate for consideration.
About Boy Scouts of America
The Boy Scouts of America -- https://www.scouting.org/ -- is a
federally chartered non-profit corporation under title 36 of the
United States Code. Founded in 1910 and chartered by an act of
Congress in 1916, the BSA's mission is to train youth in
responsible citizenship, character development, and self-reliance
through participation in a wide range of outdoor activities,
educational programs, and, at older age levels, career-oriented
programs in partnership with community organizations. Its national
headquarters is located in Irving, Texas.
The Boy Scouts of America and affiliate Delaware BSA, LLC, sought
Chapter 11 protection (Bankr. D. Del. Lead Case No. 20-10343) on
Feb. 18, 2020, to deal with sexual abuse claims.
Boy Scouts of America was estimated to have $1 billion to $10
billion in assets and at least $500 million in liabilities as of
the bankruptcy filing.
The Debtors have tapped Sidley Austin LLP as their bankruptcy
counsel, Morris, Nichols, Arsht & Tunnell LLP as Delaware counsel,
and Alvarez & Marsal North America, LLC, as financial advisor.
Omni Agent Solutions is the claims agent.
The U.S. Trustee for Region 3 appointed a tort claimants' committee
and an unsecured creditors' committee on March 5, 2020. The tort
claimants' committee is represented by Pachulski Stang Ziehl &
Jones, LLP, while the unsecured creditors' committee is represented
by Kramer Levin Naftalis & Frankel, LLP.
CAPITOL PRESORT: Says Firstrust Bank Now Backing Plan
-----------------------------------------------------
Capitol Presort Services, LLC, is seeking confirmation of its
Amended Plan of Reorganization.
Under the Plan, Classes 4, 5, 6 and 7 are delineated as the classes
of Claims which are eligible to vote under the Amended Plan. Of
the classes of Claims permitted to vote on the Plan, Classes 5 and
7 have voted to accept the Plan. While Class 4 and Class 6 have
not voted at all on the Plan, the Debtor believes that the Plan can
be confirmed.
According to the Debtor, it is believed that Firstrust Bank will
support the Plan by the time of the Confirmation Hearing. The
Class 4 Claim holder, Firstrust Bank, is being treated under the
Plan such that the requirements of Section 1129(b) are met.
Further, Firstrust Bank is being paid the full amount which is owed
over time, including interest, as permitted by Section 1129(b) as
to a secured creditor so as to cause the Plan to be confirmed.
Further, Firstrust Bank is retaining its collateral until such time
as it is paid in full as required by Section 1129(b).
LG Funding, LLC, the Class 6 Claim holder, is, under the Plan,
treated as an unsecured creditor under Class 7. Accordingly, it is
believed that because Class 7 has accepted the Plan, and LG
Funding, LLC has not voted, the Plan can be confirmed
notwithstanding the lack of a vote from the Class 6 creditor, LG
Funding, LLC.
The Debtor believes the requirements of Section 1129(b) with
respect to confirmation of the Plan notwithstanding the lack of a
Class 6 vote not in favor of a Plan have been met because, in part,
such Class 6 Claim holder is actually a Class 7 Claim holder.
Class 7 has voted in favor of the Plan. Further, based upon the
agreement as to the treatment of Firstrust Bank, Firstrust Bank has
indicated that it now supports and accepts the Plan. Because the
lack of a vote by Class 6 does not deny confirmation under Section
1129(a), it is believed that the cramdown provisions of Section
1129(b) as to Firstrust Bank need not be utilized for
confirmation.
There are two Objections filed with respect to the Plan. These
Objections are:
a. The first Objection is filed by 1400 Hagy Way Holdings, LLC
("Hagy"), the Debtor's landlord. The Objection relates to payment
of arrears owed by the assumption of the Debtor's lease with Hagy.
The Debtor will pay the arrears on or before the Effective Date of
the Plan. Such funds are in hand and are held by the Debtor in the
amount of $84,153.87. Therefore, it is believed that the Objection
of confirmation of the Plan as filed by Hagy should be considered
resolved.
b. Firstrust Bank, the Class 4 Claim holder, has filed an
Objection to the Plan because of the inconsistency between the
language of Section 5.1.4 as to the treatment of the Firstrust
Claim, and the projections. The projections set forth a higher
monthly amount to be paid to Firstrust Bank. The language of
Section 5.1.4 contains an error and, thus, the Debtor will place
into the Confirmation Order that the monthly payments to Firstrust
Bank shall agree with the projections resulting in payments of
$12,000.00 per month to Firstrust. Therefore, it is believed that
the Objection of Firstrust Bank is resolved and that Firstrust Bank
supports the Plan. Firstrust will withdraw its Objection.
Because the Class 7 Claim holders, the General Unsecured Creditors,
have voted to accept the Plan, the Plan meets the requirements of
Section 1129(a) of the Bankruptcy Code as to the Unsecured
Creditors as to confirmation, and confirmation can occur without
resulting to a cram down as to such class of unsecured creditors.
Because the provisions of Section 1191(a), particularly as to the
Unsecured Creditors, of the Bankruptcy Code are met, as well as the
provisions of Section 1129 being met, the Plan can be confirmed, as
the Class 7 Unsecured Claim holders are receiving all that they
would otherwise receive in a liquidation. Further, because the
Unsecured Creditors have voted in favor of the Plan, the Plan is
consensual and, thus, the Plan can be confirmed under Section
1191(a).
Counsel for the Debtor:
Robert E. Chernicoff, Esq.
CUNNINGHAM, CHERNICOFF & WARSHAWSKY, P.C.
2320 North Second Street, P. O. Box 60457
Harrisburg, PA 17106-0457
Tel: (717) 238-6570
About Capitol Presort Services
Capitol Presort Services, LLC is a corporation engaged in mail
presorting services. The Debtor sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. M.D. Pa. Case No. 22-01406) on
July 29, 2022. In the petition signed by Philip E. Gray, Esq.,
member, the Debtor disclosed up to $1 million in both assets and
liabilities.
Judge Henry W. Van Eck oversees the case.
Robert E. Chernicoff, Esq., at Cunningham, Chernicoff & Warshawsky
PC, is the Debtor's counsel.
CAROLINA CAJUNS: Taps Stuart K. Clark as Accountant
---------------------------------------------------
The Carolina Cajuns, LLC received interim approval from the U.S.
Bankruptcy Court for the District of Connecticut to employ Stuart
K. Clark, CPA, LLC as its accountant.
The firm's services include:
-- assisting with various reporting and other requirements of
the Bankruptcy Code, including preparing cash analyses for the
Debtor's cash collateral motions and orders, monthly operating
reports, projections, and tax returns; and
-- providing accounting services for the operation of the
Debtor's business.
The firm's regular hourly rates range from $50 to $250.
As disclosed in court filings, Stuart K. Clark, CPA is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached at:
Stuart K. Clark
Stuart K. Clark, CPA, LLC
72 Queen Street
Southington, CT 06489
Tel: (860) 621-6425
About The Carolina Cajuns
The Carolina Cajuns, LLC is a company based in Somers, Conn., which
operates in the restaurant industry.
Carolina Cajuns sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Conn. Case No. 22-20640) on Sept. 16,
2022, with up to $50,000 in assets and up to $10 million in
liabilities. Steven A. Galloway, president of Carolina Cajuns,
signed the petition.
Judge James J. Tancredi oversees the case.
John P. Newton, Esq., at Reid and Riege, P.C. and Stuart K. Clark,
CPA, LLC serve as the Debtor's counsel and accountant,
respectively.
CELSIUS NETWORK: Return to Custody Account Holders Okayed
---------------------------------------------------------
As widely reported, the U.S. bankruptcy judge involved in the
Celsius Networks bankruptcy case ordered the crypto lender to
return crypto now worth $50 million to users of custody accounts.
According to Reuters, at a hearing Dec. 7, 2022, Judge Martin Glenn
approved the return of funds of customers who had non-interest
bearing custody accounts, whose funds were not commingled with
other Celsius assets, and whose accounts were too small for Celsius
to seek to claw them back to repay other customers, according to
Celsius' official creditors committee.
Coindesk reports that Celsius' argument was that unlike Celsius
customers using its Earn or Borrow products, customers with
custodial accounts still maintain ownership of their crypto assets.
Celsius was merely acting as the storage provider. Therefore,
these funds belong to the customers, not to Celsius' estate.
The order only applies to an amount of crypto that was worth about
$44 million in September. It's a tiny fraction of the billions of
dollars of coins Celsius owes customers, Bloomberg notes.
Celsius said in September it has about 58,300 users who
collectively deposited over $210 million with its custody and
withhold, with 15,680 customers holding "Pure Custody Assets" worth
around $44 million.
Judge Glenn has not yet ruled on ownership of Celsius "earn"
accounts or "withhold" accounts.
According to Reuters, earn accounts, which paid interest to
customers and allowed Celsius to use customer funds to make loans,
were the default account type at Celsius before regulatory
investigations forced it to change course early in 2022.
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 Debtors estimated assets and liabilities between $1
billion and $10 billion.
The Debtors tapped Kirkland & Ellis, LLP and Kirkland & Ellis
International, LLP as legal counsels; Centerview Partners, LLC as
investment banker; and Alvarez & Marsal North America, LLC as
financial advisor. Stretto, the claims agent and administrative
advisor, maintains the page https://cases.stretto.com/celsius
On July 27, 2022, the U.S. Trustee appointed an official committee
of unsecured creditors. The committee tapped White & Case, LLP as
its bankruptcy counsel; Elementus Inc. as its blockchain forensics
advisor; M3 Advisory Partners, LP as its financial advisor; and
Perella Weinberg Partners, LP as its investment banker.
Shoba Pillay, Esq., is the examiner appointed in the Debtors'
Chapter 11 cases. Jenner & Block, LLP and Huron Consulting
Services, LLC serve as the examiner's legal counsel and financial
advisor, respectively.
CENTRAL FLORIDA CIVIL: Amends Several Secured Claims Pay Details
----------------------------------------------------------------
Central Florida Civil, LLC, submitted an Amended Subchapter V Plan
of Reorganization dated December 6, 2022.
This Plan of Reorganization proposes to pay unsecured creditors of
the Debtor all disposable income during months 1-60 from future
income of the Debtor derived from income generated from the civil
engineering/site prep business that the Debtor owns in order to
obtain a discharge.
This Plan provides for 18 class(es) of secured claims, 2 Classes of
Priority Claims and 1 class of unsecured claims. Unsecured
creditors holding allowed claims will receive distributions which
the proponent of this Plan has valued at approximately 1 cents on
the dollar based upon current projections of disposable income.
This Plan also provides for the payment of administrative and
priority claims either upon the effective date of the Plan or as
allowed under the Bankruptcy Code.
Class 2 consists of Ally Financial Claim. Continued regular
payments of $844.10 until contract expiration in January 2027.
Class 3 consists of Chase Automotive Claim. Continued regular
payments of $757.28 until contract expiration.
Class 12 consists of PNC Bank Claim. Continued regular payments of
$724.77 until contract expiration in October 2026.
Class 13 consists of Truist Bank Claim. Continued regular payments
of $718.59 until contract expiration.
Like in the prior iteration of the Plan, the Debtor shall pay the
total amount of unsecured claims at the rate of $500.00 during
months 1-60 of the plan of reorganization for 1% repayment of all
unsecured claims.
A full-text copy of the Amended Subchapter V Plan dated December 6,
2022, is available at https://bit.ly/3FKhICS from PacerMonitor.com
at no charge.
Attorneys for Debtor:
Bryan Keith Mickler, Esq.
Law Offices of Mickler & Mickler
5452 Arlington Expy
Jacksonville, FL 32211-6860
Office: 904-725-0822
Cell: 904-725-0822
Fax: 904-725-0855
Email: bkmickler@planlaw.com
About Central Florida Civil
Central Florida Civil, LLC, provides a full range of services
relating to site preparation for commercial projects.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Court (Bankr. M.D. Fla. Case No. 22-01736) on Aug. 31,
2022. In the petition signed by Chad M. Converse, manager, the
Debtor disclosed $2,469,641 in assets and $4,873,621 in
liabilities.
Judge Jason A. Burgess oversees the case.
Bryan K. Mickler, Esq., at the Law Offices of Mickler & Mickler,
LLP, is the Debtor's counsel.
CENTRAL FLORIDA CIVIL: Wins Final Cash Collateral Access
--------------------------------------------------------
The U.S. Bankruptcy Court for the Middle District of Florida,
Jacksonville Division, authorized Central Florida Civil, LLC to use
the cash collateral of Mulligan Funding, LLC and the Fundworks, LLC
on an interim basis.
As of the Petition Date, the Debtor owed $150,000 each to Mulligan
Funding, LLC and the Fundworks, LLC. The Debtor's obligation is
evidenced by a Promissory Note, Security Agreement, Financing
Statement, and Chattel Mortgage executed November 22, 2021, to
Mulligan and January 5, 2022, to Fundworks.
The Debtor is directed to pay only expenses necessary for the
operation of the business and not any pre-petition expenses,
officer salaries, professional fees, or insiders without further
Court order. If that order is entered, the necessary pre-petition
expenses, salaries, professional fees, or insider payments will not
be paid unless the Debtor is current on its ordinary course of
business expenses.
The Debtor is authorized to make these adequate protection
payments:
a. $1,519 per month to Mulligan Funding commencing October 1,
2022, and on the first of the month thereafter or further Court
Order;
b. $1,519 per month to Fundworks commencing October 1, 2022,
and on the first of the month thereafter or further Court Order;
c. $519 per month to Fiji Funding, LLC commencing October 1,
2022 and on the 1st of the month thereafter or further Court Order;
and
d. All other UCC-1 receivable lenders including NewCo Capital
Group, Kalamata Capital Group, Fusion Funding, Unique Capital and
Amerifii will receive no adequate protection at this time.
As additional adequate protection of a lender's interest in the
cash collateral, the Debtor will (a) maintain all necessary
insurance coverage on the lender's collateral and under no
circumstances will the Debtor allow its insurance coverage to
lapse, (b) continue to pay such monthly insurance payment in a
timely manner, and (c) within two days of the request of the
lender, the Debtor will provide to the lender's counsel a written
statement supported by evidence of the Debtor's compliance with the
foregoing.
The Debtor's authority to use the cash collateral will terminate
immediately and upon the earlier of (a) a Court order; (b) the
conversion of the case to a Chapter 7 case or the appointment of a
Chapter 11 trustee without the consent of the lender; (c) the entry
of an Order that alters the validity or priority of the replacement
liens granted therein to the Bank; (d) the Debtor ceasing to
operate all or substantially all of its business; (e) the entry of
an order granting relief from the automatic stay that allows any
entity to proceed against any material assets of the Debtor that
constitute cash collateral; (f) the entry of an Order authorizing a
security interest under section 364(c) or 364(d) of the Bankruptcy
Code in the collateral to secure any credit obtained or debt
incurred that would be senior to or equal to the replacement lien;
or (g) the dismissal of the Chapter 11 case.
A continued hearing on the matter is set for January 13 at 10 a.m.
A copy of the order is available at https://bit.ly/3j1hxtH from
PacerMonitor.com.
About Central Florida Civil, LLC
Central Florida Civil, LLC provides a full range of services
relating to site preparation for commercial projects.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Court (Bankr. M.D. Fla. Case No. 22-01736) on August 31,
2022. In the petition signed by Chad M. Converse, manager, the
Debtor disclosed $2,469,641 in assets and $4,873,621 in
liabilities.
Judge Jason A. Burgess oversees the case.
Bryan K. Mickler, Esq., at the Law Offices of Mickler & Mickler,
LLP, is the Debtor's counsel.
CLAIM JUMPER: Wins Cash Collateral Access, $1.520MM DIP Loan
------------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Pennsylvania
authorized Claim Jumper Acquisition Company, LLC and affiliates to
use cash collateral and obtain postpetition financing on an interim
basis.
The Debtors are permitted to obtain the maximum principal loan
amount of $1.520 million under the DIP Facility, according to the
Court's interim order.
In their request, the Debtors said the postpetition financing
consisted of a credit facility in the maximum principal amount of
$2.57 million under a Debtor-In-Possession Loan and Security
Agreement, by and among the Debtors and Restaurant Lending, LLC.
The Debtors are authorized to use the proceeds of the DIP Facility
solely: (1) in accordance with the terms and provisions of the DIP
Loan Documents and (2) to the extent the Debtors are required to
pay, and cash collateral is insufficient to satisfy, those expenses
enumerated in the Approved Budget, including, without limitation,
the Carve-Out, as and when such expenses become due and payable,
subject to the Permitted Variances and the terms of the DIP Loan
Documents.
The material terms of the DIP Facility includes:
i. Principal Amount. The maximum principal loan amount of
$1.520 million under the DIP Facility is authorized pursuant to the
terms of the Order.
ii. Interest. The unpaid principal amount of the DIP Loans
outstanding from the Closing Date until all DIP Obligations are
repaid in full will bear interest at a rate per annum equal to
7.5%. During the existence of an Event of Default, the principal
amount of the DIP Loans (and, to the greatest extent permitted by
Applicable Law, all accrued but unpaid interest and all other
outstanding DIP Obligations) will bear interest at a rate per annum
equal to 12.5%.
iii. DIP Lender Expenses. The Debtors will be responsible for
all of the DIP Lender's reasonable and documented expenses, costs,
fees and disbursements of the kind set forth in section 3.2 of the
DIP Credit Agreement.
iv. Closing Fee. The Debtors will pay a closing arrangement fee
in an amount equal to 2.0% of the cash advanced aggregate
commitments under the DIP Facility. Such fee will be payable (and
funded under the DIP Facility by being added to the principal
balance) upon advancement of the cash portion of the DIP Loans.
v. Exit Fee. The Debtors will pay an exit fee in an amount
equal to 2.0% of the aggregate commitments under the DIP Facility,
upon payment in full of the DIP Facility other than as a result of
a "credit bid" by the DIP Lender in connection with a sale of the
DIP Collateral.
vi. Maturity. The DIP Obligations will mature and be due and
payable in full by the Debtors on the DIP Termination Date.
vii. Joint and Several Liability of the Debtors. The obligations
of each Debtor under this Order are joint and several.
viii. Breach of Asset Purchase Agreement. If the Asset Purchase
Agreement, dated December 3, 2022, is terminated pursuant to
section 8.1(c)(i) of the APA, then, subject to section 8.4(b) of
the APA, the DIP Obligations will be deemed to be reduced by the
Deposit Amount.
The DIP Termination Date is the date that is the earliest to occur
of:
i. the consummation of any sale of all or substantially all of
the assets of the Debtors pursuant to section 363 of the Bankruptcy
Code or otherwise;
ii. if this Order has not been entered, the date that is
twenty-one calendar days after the service of the motion for
approval of the DIP Facility (or such later date agreed to in
writing by the DIP Lender);
iii. December 23, 2022 (or such later date as agreed to in
writing by the DIP Lender),
iv. the acceleration of any portion of the DIP Obligations and
the termination of the DIP Facility commitments upon the occurrence
of an Event of Default pursuant to the DIP Loan Documents; and
v. the effective date of any plan of reorganization that is
filed in the Cases and confirmed pursuant to an order entered by
the Bankruptcy Court.
The Debtors require the DIP Loans to minimize disruption to, and
avoid the termination of, their business operations, thereby
maximizing the value of the Debtors' businesses and estates.
The DIP Obligations are granted superpriority administrative
expense status under section 364(c)(1) of the Bankruptcy Code, with
priority over all costs and expenses of administration of the Cases
that are incurred under any provision of the Bankruptcy Code but
subject in all respects to the Carve-Out and Permitted Priority
Liens.
In addition, the DIP Lender is granted the DIP Liens to secure the
DIP Obligations. Subject only to the Carve-Out and Permitted
Priority Liens, the DIP Liens: (1) under sections 364(c)(2) and
364(c)(3) of the Bankruptcy Code, is a first priority Lien without
any further action by the Debtors or the DIP Lender, and without
the execution, delivery, filing, or recordation of any financing
statements, security agreements, control agreements, title
notations, mortgages, or other documents or instruments; (2) will
not be subject to any security interest or Lien that is avoided and
preserved under section 551 of the Bankruptcy Code; (3) will remain
in full force and effect until all DIP Obligations are repaid in
full in cash, notwithstanding any subsequent conversion or
dismissal of any Case; (4) is not subject to section 510(c) of the
Bankruptcy Code; and (5) except as expressly permitted in the DIP
Credit Agreement, will not be subject to any banker's Lien,
bailee's rights, carrier's Lien, right of distraint or levy,
security interest, right of setoff, or any other Lien, right, or
interest that any bailee, warehousemen, bank, processor, or carrier
may have in any or all of the DIP Collateral.
The Debtors are required to comply with these milestones:
a. On or before the filing of the motion to approve the DIP
Facility, the Debtors will have filed a motion seeking the
Bankruptcy Court’s approval of Bidding Procedures, a 363 Sale and
dismissal of each of these cases promptly upon the closing of the
363 Sale, such motion, proposed Bid Procedures Order and 363 Sale
Order, and supporting declarations, in each case, being in form and
substance acceptable to the DIP Lender;
b. On or before November 23, 2022 (or such later date as the
DIP Lender may agree, in writing, in its discretion), the Debtors
will obtain a Bid Procedures Order;
c. On or before November 23, 2022 (or such later date as the
DIP Lender may agree, in writing, in its discretion), the Debtors
shall have executed a purchase and sale agreement, in form and
substance acceptable to DIP Lender as the opening bid with respect
to the 363 Sale;
d. On or before December 13, 2022 (or such later date as the
DIP Lender may agree, in writing, in its discretion), the Debtors
will have commenced an auction in accordance with the Bid
Procedures Order;
e. On or before December 15, 2022 (or such later date as the
DIP Lender may agree, in writing, in its discretion), the
Bankruptcy Court will have entered a 363 Sale Order;
f. On or before December 23, 2022 (or such later date as the
DIP Lender will agree, in writing, in its sole discretion), (a) the
363 Sale approved by the 363 Sale Order will have closed and the
DIP Obligations shall have been paid in full in cash or as
otherwise agreed in writing by the DIP Lender and (b) the
Bankruptcy Court will have entered an order dismissing these
cases.
A copy of the motion is available at https://bit.ly/3PotdmC from
Stretto, the claims agent.
A copy of the order is available at https://bit.ly/3hhfd1d also
from Stretto.
About Claim Jumper Acquisition Company
Claim Jumper Acquisition Company, LLC and its affiliates operate
four restaurant concepts, Claim Jumper Steakhouse & Bar, Joe's Crab
Shack, Brick House Tavern + Tap, and Nashville Hot Chicken Shack,
that offer a variety of food and beverages in a distinctive,
casual, high-energy atmosphere.
Claim Jumper closed 29 of 62 stores and then on Oct. 3, 2022, filed
for Chapter 11 protection (Bankr. W.D. Pa. Lead Case No. 22-21941)
along with seven affiliates, including C Jumper Restaurant, Inc. At
the time of filing, Claim Jumper Acquisition reported $1 million to
$10 million in assets and $1 0 million to $50 million in
liabilities.
The Hon. Gregory L. Taddonio is the case judge.
The Debtors tapped Morris, Nichols, Arsht & Tunnell, LLP as general
bankruptcy counsel; Whiteford, Taylor & Preston, LLP as local
bankruptcy counsel; and Wyse Advisors, LLC as restructuring
advisor. Michael Wyse, managing director at Wyse Advisors, serves
as the Debtors' chief restructuring officer. Stretto is the claims
and noticing agent and administrative advisor.
The U.S. Trustee for Regions 3 and 9 appointed an official
committee of unsecured creditors on Oct. 18, 2022. The committee is
represented by Kelley Drye & Warren, LLP.
Restaurant Lending, LLC, as DIP Lender, is represented by Morris,
Nichols, Arsht & Tunnell LLP.
CMR REAL ESTATE: Continued Operations to Fund Plan Payments
-----------------------------------------------------------
CMR Real Estate Investments, LLC, filed with the U.S. Bankruptcy
Court for the Northern District of Ohio a Plan of Reorganization
for Small Business dated December 6, 2022.
The Debtor is an Ohio Limited liability Company wholly owned by
Christopher Vanuch. The Debtor was created on March 19, 2018 to
invest, rehabilitate, rent and sell real estate.
The reduction in business caused by the Coronavirus pandemic in
2020 had a devastating effect on the Debtor's business as many of
its tenants were unable or unwilling to pay rent. However, the
eviction moratorium has ended and the debtor is removing non-paying
tenants and attempting to recoup unpaid rent both directly from its
tenants and from COVID relief funds that are available for
non-payment of rent. The Debtor has made application for relief
funds, but the applications must be submitted by the Debtor's
tenants, not the Debtor, and delays have resulted. To date, no such
funds have been received.
In 2022, the Debtor's cash flow improved and continues to improve,
but it is not able to bring its mortgage loan accounts current to
stop the remaining foreclosure proceedings and has not had success
attempting to reach settlements with its lenders. Therefore, the
Debtor filed this case to seek an opportunity to reorganize.
There are potential general unsecured claims that will result from
properties that were sold via sheriff's sale prior to the case
being filed, from properties that may be surrendered in this
proceeding, and from properties that may be valued in the Debtor's
reorganization plan. No claims for priority or general unsecured
claims have been filed to date.
The final payment is expected to be paid on March 1, 2028.
This Plan of Reorganization proposes to pay creditors of the Debtor
from cash flow from operations.
Non-priority, non-insider, unsecured creditors holding allowed
claims will receive distributions of all the debtor's net
disposable income for a period of 5 years beginning with the
effective date of the plan, to be disbursed by the Debtor in
deferred quarterly payments. Insiders holding non-priority
unsecured claims will receive no payments during the course of the
plan. This Plan also provides for the payment of administrative and
priority claims.
Class 1 consists of the Secured claims of U.S. Bank Trust, NA
secured by 701 Kling St. and 559 Nash St. The Debtor will surrender
these properties to the secured creditor.
Class 2 consists of the Secured claims of Investors Heritage Life
Insurance Co. and U.S. Bank Trust, NA secured by other real estate
assets. The Debtor will continue to seek loan modifications with
secured creditors and will honor the agreements so reached; in the
event modifications agreements are not reached on a property, the
Debtor will value that property by agreement with the secured
creditor or judicially and pay the secured amount so allowed as
follows: the Debtor will pay post-petition installments at the
contractual amount required prior to filing and will pay the
remainder of the allowed secured amount during the plan, via
deferred payments, refinancing or in lump sum. The unsecured
portion of each claim will be treated in accordance with the
treatment provisions for Class 3.
Class 3 consists of Allowed general unsecured claims. Holders of
allowed, general unsecured claims will each be paid a pro-rata
share of the debtor's net disposable income for five years
beginning with the effective date of the plan, to be disbursed in
deferred quarterly payments by the Debtor. This Class is impaired.
Payments due to creditors in Class 3 [allowed, general unsecured
claims] shall be made quarterly, with all other payments being made
monthly.
Class 4 consists of Equity security interest of Christopher Vanuch.
No distributions will be made on any equity interest during the
course of the Plan.
Payments and distributions under the Plan will be funded from cash
flow from the Debtor's operations. The Debtor will pay normal
operating expenses and make disbursements as set forth in the plan
from income generated by the Debtor's business activity. The Debtor
projects that it will receive enough income revenue during the
course of the plan to meet all of its financial obligations as set
forth in the plan.
A full-text copy of the Plan of Reorganization dated December 6,
2022, is available at https://bit.ly/3Bsu1ks from PacerMonitor.com
at no charge.
About CMR Real Estate Investments
CMR Real Estate Investments, LLC, a ompany in Akron, Ohio, filed a
petition for relief under Subchapter V of Chapter 11 of the
Bankruptcy Code (Bankr. N.D. Ohio Case No. 22-51057) on Sept. 7,
2022, with $1 million to $10 million in both assets and
liabilities. M. Colette Gibbons has been appointed as Subchapter V
trustee.
Judge Alan M. Koschik oversees the case.
The Debtor tapped Richard H. Nemeth, Esq., at Nemeth & Associates,
LLC as legal counsel and VanBaker Properties, LLC as property
manager.
CNX RESOURCES: Former COO to Receive $161,539 Cash, Other Benefits
------------------------------------------------------------------
CNX Resources Corporation disclosed in a Form 8-K filed with the
Securities and Exchange Commission that in connection with the
previously announced departure of Mr. Chad Griffith, former chief
operating officer of CNX, Mr. Griffith executed a letter agreement
with the Company on Dec. 2, 2022 (which Agreement became effective
following the expiration of the revocation period, which ends on
Dec. 9, 2022), pursuant to which the Company agreed to provide him
the following (which was approved by the Company's Compensation
Committee):
(i) a lump sum payment equal to $161,539;
(ii) to vest the equivalent of $200,000 worth of unvested
restricted stock units previously granted to Mr. Griffith under the
Company's Equity and Incentive Compensation Plan;
(iii) to permit the option awards granted to Mr. Griffith under
the Plan, to the extent vested on the Departure Date, to remain
exercisable until the expiration of the applicable option term as
set forth in the related option award agreement;
(iv) to permit Mr. Griffith to retain, to the extent vested on
the Departure Date, any restricted stock unit and performance share
unit awards previously granted to Mr. Griffith; and
(v) to subsidize the cost of health insurance coverage for Mr.
Griffith through March 31, 2023.
Mr. Griffith has agreed to release any claims against the Company
and its affiliates, and the Agreement contains customary mutual
non-disparagement provisions. In accordance with law, Mr. Griffith
is entitled to revoke his acceptance of the Agreement within seven
days after its execution. If Mr. Griffith revokes his acceptance,
the Agreement will be of no further force or effect, and Mr.
Griffith will not be entitled to the benefits described above.
About CNX Resources
CNX Resources Corporation is an independent natural gas
development, production, and midstream company, with operations
centered in the major shale formations of the Appalachian basin.
CNX reported a net loss of $498.64 million for the year ended Dec.
31, 2021, compared to a net loss of $428.74 million for the year
ended Dec. 31, 2020. For the nine months ended Sept. 30, 2022, the
Company reported a net loss of $1.32 billion.
COMMUNITY HEALTH: Amends Equity Award Pacts With Non-Exec Chairman
------------------------------------------------------------------
The Board of Directors of Community Health Systems, Inc., upon the
recommendation of the Compensation Committee of the Board, approved
and the Company entered into an amendment to certain equity award
agreements previously entered into between the Company and Wayne T.
Smith, its executive chairman of the Board, in conjunction with the
outstanding grants to Mr. Smith of stock options and restricted
stock of the Company awarded while he has served as an officer of
the Company. In this regard, as previously disclosed in a Current
Report on Form 8-K filed on Dec. 2, 2022, Mr. Smith informed the
Company that he will retire as executive chairman, an officer of
the Company, on Jan. 1, 2023. Mr. Smith will continue to serve as
the non-executive Chairman of the Board following his retirement as
executive chairman.
Pursuant to the Amendment, Mr. Smith's previously granted stock
options will remain in effect in accordance with the applicable
terms of their grants, and he will also continue to vest in
previously granted restricted stock of the Company in accordance
with the applicable vesting terms and schedules, for so long as he
serves as a member of the Board.
As a non-management director, Mr. Smith will receive the same
standard compensation paid to all of the Company's non-management
directors beginning in 2023, including an annual cash stipend
payable in quarterly installments and an annual equity grant. In
addition, on Dec. 7, 2022, the Board, upon the recommendation of
the Governance and Nominating Committee of the Board, also approved
an additional annual cash stipend of $265,000 to be payable to Mr.
Smith in quarterly installments in connection with his service as
the non-executive Chairman of the Board beginning in 2023.
About Community Health Systems Inc.
Community Health Systems, Inc. -- http://www.chs.net-- is a
healthcare company whose affiliates provide healthcare services,
developing and operating healthcare delivery systems in 47 distinct
markets across 16 states. As of Oct. 26, 2022, the Company's
subsidiaries own or lease 81 affiliated hospitals with
approximately 13,000 beds and operate more than 1,000 sites of
care, including physician practices, urgent care centers,
freestanding emergency departments, occupational medicine clinics,
imaging centers, cancer centers and ambulatory surgery centers.
As of Sept. 30, 2022, the Company had $14.91 billion in total
assets, $16.09 billion in total liabilities, $516 million in
redeemable noncontrolling interest in equity of consolidated
subsidiaries, and a total stockholders' deficit of $1.69 billion.
* * *
As reported by the TCR on Dec. 29, 2020, S&P Global Ratings raised
its issuer credit rating on Community Health Systems Inc. to 'CCC+'
from 'SD' (selective default). S&P said, "The stable outlook
reflects our view that the company has reduced its debt and
improved its operations and cash flow such that its debt is now
more manageable; however, we believe risks to the long-term
sustainability of the capital structure remain, especially given
ongoing uncertainty stemming from the coronavirus pandemic."
CRED INC: Trustee Sues Earnity Over 'Stolen' Intellectual Property
------------------------------------------------------------------
A trustee for the bankruptcy estate of failed crypto lender Cred
Inc. sued crypto asset exchange Earnity Inc. and several affiliates
in Delaware, accusing them of profiting from intellectual property
that was allegedly stolen from Cred just before it filed for
bankruptcy.
In Cred Inc. Liquidation Trust v. Earnity, Inc. et al., Adv. Pro.
No. 1:22-ap-50474 (Bankr. D. Del.), the Cred Inc. Liquidation Trust
established in the Chapter 11 cases of Cred Inc. and its affiliated
debtors filed a complaint against defendants Earnity, Inc., Earnity
Financial, Inc. (a Delaware corporation), Earnity Financial, Inc.
(a Florida corporation), and Domenic Carosa, saying that when Cred
was on the brink of bankruptcy, former CEO Dan Schatt and other
senior management were planning their exit to start a new company
-- Earnity -- that would use what he called the "secret sauce" they
had been creating at Cred.
Prepetition, Cred invested company time and resources into
developing this new business platform, which was called "Cred 2.0"
which was referred to internally as a "billion-dollar opportunity"
for the company. The plan was to create a social media-focused
crypto investment platform that would make it easy for retail
investors to participate in various forms of crypto investing.
These included yield-earning opportunities in the form of loans (as
part of Cred's "centralized finance" or "CeFi" offerings), as well
as more complex "staking" transactions and other opportunities
built around "decentralized finance" or "DeFi". The business would
be a retail-focused "CeFi/DeFi router" that would drive crypto
investors to innovative yield-earning and trading opportunities
that were previously inaccessible to typical retail investors. But
while Cred was busy developing "Cred 2.0", Cred's financial
situation continued to deteriorate.
When it became clear that bankruptcy was inevitable, Cred's plan
was to focus on restructuring the company so that it could emerge
from bankruptcy centered around the new platform it was developing.
However, Cred's senior executives-- including Chief Executive
Office Dan Schatt, Chief Financial Officer Joseph Podulka, and
Chief Technology Officer Daniel Goldstein -- had other ideas. They
wanted to take Cred's new platform for themselves.
By the time Cred declared bankruptcy on Nov. 7, 2020, Schatt,
Podulka, and Goldstein had agreed on a plan to take Cred 2.0 and
start a new company of their own. Schatt, Podulka and Goldstein
started by recruiting key Cred employees (mostly product developers
and engineers) who were already working on Cred 2.0 to join them in
their new venture. They needed these employees to identify and
extract Cred's software, hardware, programming tools and data,
branding and marketing designs, and other highly confidential and
proprietary information that they would need to complete Cred 2.0
at their new company.
But Cred's senior management team could not loot Cred and launch
Cred 2.0 alone. That is where Carosa, Earnity's other co-founder,
came into play. Carosa is the founder of Banxa Holdings, Inc., a
fiat-to-cryptocurrency payment processing company. He was first
introduced to Schatt by Cred's restructuring mergers and
acquisitions advisor after identifying Banxa as a potential buyer
for Cred. Schatt and Carosa took an immediate liking to each other
and were soon communicating privately about "Cred 2.0." Instead of
having Banxa buy Cred, Carosa joined Schatt and his
co-conspirators' plan to steal "Cred 2.0" without paying a penny to
Cred.
Carosa and Schatt both knew that Banxa was not going to purchase
Cred. Yet Banxa engaged in negotiations with Cred and its advisors
for months under that pretense. These protracted "negotiations"
served two purposes. First, they gave Goldstein's team of
developers and programmers additional time and use of Cred's
limited resources to continue their work on the platform they were
supposed to be building for Cred. Second, they gave Carosa and his
team time to mine Cred’s data room for key intellectual property
and other proprietary information that would be used to continue
building Cred 2.0 at the new companies that would become the
Earnity Defendants.
"Defendants have benefited and will continue to benefit from the
same confidential and proprietary information, including trade
secrets, that former Cred executives, employees, and their
co-conspirators stole from Cred. Because these assets are property
that belong to Cred's estate and that should and would have inured
to the benefit of Cred and its creditors had they not been
wrongfully misappropriated, the Trust brings this action to recover
them," according to the complaint.
The complaint seeks the following relief:
1. Avoiding the Post-Petition Transfer of the Transferred Assets
and Trade Secrets pursuant to Bankruptcy Code § 549(a), Cal. Civ.
Code Sec. 3439.04, and Cal. Civ. Code Sec. 3439.05 and directing
the Earnity Defendants to return the Transferred Assets and Trade
Secrets, or an amount to be determined at trial equal to the value
of the Transferred Assets and Trade Secrets, to the Trust pursuant
to Bankruptcy Code Sec. 550(a);
2. Actual damages and/or restitution in an amount to be
determined at trial equal to the lost value of the Cred 2.0 Trade
Secrets that were misappropriated from Cred pursuant to 18 U.S.C.
Sec. 1836 and Cal. Civ. Code Sec. 3426.3(a); and/or, alternatively,
reasonable royalty for Defendants' use of the Cred 2.0 Trade
secrets under Cal. Civ. Code Sec. 3426.3(b);
3. Exemplary damages under Cal. Civ. Code Sec. 3426.3(c), as
well as attorneys' fees and costs under Cal. Civ. Code Sec.
3426.4;
4. Actual damages and/or restitution in an amount to be
determined at trial for Defendants' unlawful, unfair, and
fraudulent business acts and practices under Cal. Bus. & Prof. Code
Sec. 17200, et seq. and/or the common law doctrine of unfair
competition;
5. Actual damages and/or restitution in an amount equal to the
value of the property and assets that Defendants have wrongfully
converted from Cred's estate and have been unjustly enriched at the
expense of Cred's estate; and
6. Actual damages and/or restitution in an amount to be
determined at trial as a result of Defendants' aiding and abetting
of the breach of fiduciary duties of Cred's former officers and
directors.
About Cred Inc.
Cred Inc. is a cryptocurrency platform that accepts loans of
cryptocurrency from non-U.S. persons and pays interest on those
loans. Cred -- https://mycred.io/ -- is a global financial
services platform serving customers in over 100 countries. Cred is
a licensed lender and allows some borrowers to earn a yield on
cryptocurrency pledged as collateral.
Cred Inc. and its affiliates sought Chapter 11 protection (Bankr.
D. Del. Lead Case No. 20-12836) on Nov. 7, 2020. Cred was
estimated to have assets of $50 million to $100 million and
liabilities of $100 million to $500 million as of the bankruptcy
filing.
Judge John T. Dorsey oversees the cases.
The Debtors tapped Paul Hastings LLP as their bankruptcy counsel,
Cousins Law LLC as local counsel, and MACCO Restructuring Group,
LLC as financial advisor. Donlin, Recano & Company, Inc., is the
claims agent.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on Dec. 3,
2020. The committee tapped McDermott Will & Emery LLLP as counsel,
and Dundon Advisers LLC as financial advisor.
Robert Stark is the examiner appointed in the Debtors' cases. Ashby
& Geddes, P.A., and Ankura Consulting Group, LLC, serve as the
examiner's legal counsel and financial advisor, respectively.
CRYSTALLEX INT'L: Bid for Examiner Denied, Recognition Granted
--------------------------------------------------------------
Bankruptcy Judge Laurie Selber Silverstein has issued an order (1)
denying Mr. Adrianza's motion for the appointment of an Examiner as
well as an independent counsel for shareholders, and (2) granting
the Foreign Representative's motion for entry of an order
recognizing and enforcing (i) the CCAA Eleventh Extension and
Fifteenth Amendment Order; and (ii) the CCAA Twelfth Extension and
Sixteenth Amendment Order.
On Dec. 23, 2011, Crystallex was granted protection under the
Companies' Creditors Arrangement Act (Canada) -- CCAA Proceedings.
That same day, Crystallex, as the Foreign Representative, commenced
a chapter 15 case in this Court.
The Foreign Representative contends that Crystallex's major, if not
only, asset is an arbitration claim (now judgment) against the
Bolivarian Republic of Venezuela based on the expropriation of the
Las Cristinas gold project in 2011. Mr. Adrianza contends that
Crystallex also owns mining data (or a claim for such) worth $340
million and has a $600 million tax loss carry forward.
On Aug. 14, 2017, Crystallex moved for an order authorizing a writ
of attachment fieri facias to PDV Holding, Inc. (a Delaware
corporation) against its shares that are wholly owned by Petróleos
de Venezuela, an alter ego of Venezuela ("PDVH Stock"). After
significant litigation, that motion was eventually granted. The
Delaware District Court has appointed Robert B. Pincus, Esquire as
a special master to conduct a sale of the PDVH Stock. The most
recent order regarding the sale was issued by the Delaware District
Court on October 4, 2022. As set forth in his opinions and
reflected in that order, whether and when the PDVH Stock may be
sold is complicated by, among other things, the necessity to deal
with the Department of the Treasury's Office of Foreign Assets
Control.
To fund the arbitration and collection proceedings against
Venezuela, Crystallex sought and obtained financing in the CCAA
Proceedings. In his supplemental filing, the Foreign
Representative supplied a chart reflecting the sequence of
financing orders as well as their respective terms. The chart
shows that the DIP Lenders have advanced US$75.733 million, with
the last advance approved by the Canadian court in December 2014
and recognized by this Court in February 2015. Counsel for the
Foreign Representative represented that as of July 31, 2021 the DIP
Lenders were owed principal and interest of approximately $162
million. In addition, the share of Net Arbitration Proceeds granted
to the DIP Lenders now stands at 88.242%, subject to the sharing
arrangement set forth in the Net Arbitration Proceeds Transfer
Agreement.
By the Examiner Motion, Mr. Adrianza seeks for the appointment of
an Examiner as well as independent counsel for shareholders --
which Crystallex and the Court have treated as a request for an
equity committee. Among other things, Mr. Adrianza argues that an
Examiner is warranted to review the circumstances of a
self-interested board that violated its duties of care and loyalty
in connection with the DIP financing and a fraudulent transfer of a
tax loss carryforward to the lenders. He also argues that there was
no effective representation of shareholders in the CCAA Proceedings
as the Canadian Court denied the various motions and many of the
filings were under seal. Mr. Adrianza also complains that
individuals cannot participate pro se in CCAA Proceedings, which
makes participation cost prohibitive.
The Foreign Representative responds that there is no legal
authority under chapter 15 for the Court to appoint an Examiner or
have the U.S. Trustee appoint an equity committee as the Foreign
Representative was not (at the time) asking for any relief and only
a Foreign Representative can do so. The Court rejects this
argument. The Court, citing its ruling in In Re Better Place,
Inc., Case No. 13-11814, 2018 Bankr. LEXIS 322 *16-18 and n. 41
(Feb. 5, 2018), explains that "Section 1522 permits the court to
condition relief granted under Section 1519 or Section 1521 and it
permits the court to modify or terminate relief previously granted
under those sections upon the request of the Foreign Representative
or an entity affected by the relief previously granted." Prior to
the filing of the Examiner Motion, the Foreign Representative had
asked for, and was granted, relief under both sections 1519 and
1521." Accordingly, the Court may modify or terminate that relief.
Moreover, subsequent to the filing of the Examiner Motion, the
Foreign Representative has sought further relief under Section 1521
in the Recognition Motion.
Nonetheless, the Court is not convinced that it should grant the
Examiner Motion at this time. As recognized by the Canadian courts
(trial and appellate), the Court also finds that serious questions
exist about whether any of the previous orders entered in the CCAA
Proceedings can and/or should be disturbed after so many years.
During the hearings, the Court has expressed similar concerns with
respect to orders entered in the Chapter 15 Case. Further, the
Court has no evidence that the interests of Crystallex and its
shareholders are not aligned at this time in respect of maximizing
recoveries on the PDVH Stock.
But, at least two issues may be appropriate to address once
proceeds from the sale of the PDVH Stock are available. First, the
Canadian court concluded that it is premature to consider whether
the arrangement with the DIP lenders establishes an effective
interest rate that violates Canada's Criminal Code. This Chapter 15
Case has been pending for eleven years, the collection proceedings
have been pending for five years and the timing of the sale of the
PDVH Stock is uncertain. Whether the effective rate of interest
under the DIP Credit Agreement will turn out to be more than 60% is
unknown. Second, it appears that the Court must determine whether
any transfer under the Mechanics of Distribution (or otherwise) is
appropriate as it relates to assets located in the United States.
Section 1520(a)(2) establishes "that the court presiding over the
chapter 15 proceedings has in rem jurisdiction over a debtor's
assets in the United States and charges that court (not the court
presiding over the foreign main proceeding) with the responsibility
to approve transfers of those assets." This provision automatically
applies upon recognition. At a minimum, the proceeds from the sale
of the PDVH Stock appear to be property within the territorial
jurisdiction of the United States.
By the Recognition Motion, the Foreign Representative asks the
Court to recognize two orders of the Canadian court: (1) order
dated May 4, 2021, which extends (maturity date to Nov. 5, 2021)
the original stay of proceedings against Crystallex and approves a
Fifteenth Credit Agreement Amendment to the DIP Credit Agreement --
it also permits certain documents to be filed under seal pending
motion practice in the CCAA Proceedings; and (2) order dated Nov.
18, 2021, which extends (maturity date to Nov. 18, 2022) the
original stay of proceedings against Crystallex and approves a
Sixteenth Amendment to the DIP Credit Agreement -- it also permits
certain documents to be filed under seal in the CCAA Proceedings,
but in more limited circumstances. Mr. Adrianza objects to the
Recognition Order in light of his Examiner Motion. He also argues
that the court should no longer permit sealing of documents in the
Chapter 15 Case.
While the Court denies the Examiner Motion at this time (without
prejudice to a later renewal), the Court will be adding certain
conditions on the relief previously granted and the relief the
Foreign Representative requests in the Recognition Motion -- (1) no
proceeds of the sale of the PDVH Stock that the District Court
awards to Crystallex can be transferred out of the United States
without the permission of the Court; and (2) no further
transfer/disposition of Net Arbitration Proceeds can be made
without the permission of the Court. This Order imposing the
conditions will also address documents that have been sealed in the
Chapter 15 Case. The Court recognizes the extension of the maturity
date of the DIP Credit Agreement, the waiver of defaults and
certain other relief granted/conditions imposed by the Canadian
court. The Court, however, will not re-confirm or re-recognize its
previous orders or the Canadian court related to the DIP
financing.
A full-text copy of the Memorandum dated Nov. 28, 2022, is
available at https://tinyurl.com/2yvvhcnp from Leagle.com.
About Crystallex International
Crystallex International Corporation is a Canadian based mining
company, with a focus on acquiring, exploring, developing and
operating mining projects. Crystallex has successfully operated an
open pit mine in Uruguay and developed and operated three gold
mines in Venezuela. The Company's principal asset is its
international claim in relation to its investment in the Las
Cristinas gold project located in Bolivar State, Venezuela.
On Dec. 23, 2011, announced that it obtained an order from the
Ontario Superior Court of Justice (Commercial List) for protection
under the Companies' Creditors Arrangement Act (Canada) (CCAA).
Ernst & Young Inc. was appointed monitor under the order.
Crystallex has also commenced a proceeding under Chapter 15 of the
Bankruptcy Code in the U.S. Bankruptcy Court for the District of
Delaware in order to ensure that relevant CCAA orders are enforced
in the United States. The Bankruptcy Court has recognized
Crystallex's CCAA proceeding as well as the initial order and
subsequent stay extension of the Ontario Superior Court of
Justice.
Following the Government of Venezuela's unilateral cancellation of
the Las Cristinas Mine Operating Contract (the "MOC") on Feb. 3,
2011, the Company filed for arbitration before ICSID's Additional
Facility and commenced the process of handing the Las Cristinas
project back to the Government of Venezuela. The handover to the
Government of Venezuela was completed on April 5, 2011, upon
receipt of a certificate of delivery from the Corporacion
Venezolana de Guayana (the "CVG"). As a result, the Company has
determined that its operations in Venezuela should be accounted for
as a discontinued operation.
The Company's balance sheet at Sept. 30, 2012, showed US$8.23
million in total assets, US$154.59 million in total liabilities and
a US$146.35 million total shareholders' deficiency.
CUSTOM ALLOY: Court OKs Cash Collateral Access
----------------------------------------------
The U.S. Bankruptcy Court for the District of New Jersey authorized
Custom Alloy Corporation and CAC Michigan, LLC to use the cash
collateral of CIBC Bank USA on an interim basis in accordance with
the budget.
The Debtors require the use of cash collateral to continue their
business operations without interruption.
Custom and CIBC have entered into secured financing arrangements
pursuant to a Loan and Security Agreement dated as of March 4,
2010. CAC Michigan guaranteed the amounts owed by Custom under the
Prepetition Loan Agreement.
As of the Petition Date, the outstanding aggregate principal amount
of the obligations owing by the Debtors to CIBC under the
Prepetition Documents, exclusive of all accrued interest, fees,
costs, expenses, charges, and other Obligations (including legal
fees and expenses) is not less than $25,966,330.
The Debtors' authorization -- and CIBC's consent -- to the use of
cash collateral will terminate, at CIBC's election and without
further notice or Court order, upon the earlier of: (i) 11:59 pm on
December 10, 2022; or (ii) the occurrence of an Event of Default;
or (iii) three business days after CIBC has provided written notice
to Debtors of the occurrence of an Event of Default under Paragraph
15(a) of the Order.
The Debtors also agreed to retain an investment banker. On or
before (a) December 8, 2022, the Debtors will have identified an
investment banker acceptable to CIBC and the Official Committee of
Unsecured Creditors; and (b) December 9, 2022, the Debtors will
file a motion, in form and substance satisfactory to the Debtors,
CIBC and the Committee, to retain an Investment Banker pursuant to
terms (including with respect to the scope of engagement)
acceptable to CIBC, the Committee, and the Debtors; and (c)
December 19, 2022, the Court shall have entered an order, in form
and substance acceptable to CIBC and the Committee, approving the
Debtors' motion to retain an Investment Banker.
As adequate protection, CIBC is granted a replacement lien under 11
U.S.C. section 361(2) on all assets of the Debtors arising after
the Petition Date in an amount equal to the aggregate diminution in
value (if any) of the Prepetition Collateral resulting from the
sale, lease, or use by Debtors of its Prepetition Collateral, or
the imposition of the automatic stay pursuant to Section 362 of the
Bankruptcy Code. The Replacement Lien granted (i) will be deemed
automatically valid and perfected without any further notice or act
by any party and (ii) will remain in full force and effect
notwithstanding any subsequent conversion or dismissal of either
Case.
To the extent the adequate protection provided proves insufficient
to protect CIBC's interest in and to cash collateral, CIBC will
have a super priority administrative expense claim, pursuant to 11
U.S.C. section 507(b), senior to any and all claims against Debtors
under 11 U.S.C. section 507(a), whether in this proceeding or in
any superseding proceeding, subject to payments due under 28 U.S.C.
section 1930(a)(6).
Each of these events constitutes an "Event of Default":
a. Either Debtor fails to perform any of its obligations with
respect to use of cash collateral in accordance with the terms of
the Order;
b. Either Case is converted to a case under chapter 7 of the
Bankruptcy Code; or
c. A trustee is appointed or elected in either of the Cases,
or an examiner with expanded power to operate either of the
Debtor's business is appointed in any of the Debtor's respective
Case.
A copy of the order and the Debtor's budget is available at
https://bit.ly/3BkuNjq from PacerMonitor.com.
The Debtor projects $1,142,035 in total cash receipts and $35,000
in total operating disbursements for the one-week period ending
December 10.
About Custom Alloy Corporation
Custom Alloy Corporation is a manufacturer of specialty metals for
seamless and welded pipe fittings & forgings, predominantly for
customers requiring time-critical maintenance or repair.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. N. J. Case No. 22-18143) on October 13,
2022. In the petition signed by Adam M. Ambielli, CEO and
president, the Debtor disclosed up to $50 million in assets and up
to $100 million in liabilities.
Judge Michael B. Kaplan oversees the case.
An official committee of unsecured creditors has retained Fox
Rothschild LLP as counsel.
Jonathan I. Rabinowitz, Esq., at Rabinowitz, Lubetkin & Tully, LLC,
is the Debtor's counsel.
CUTTING EDGE: Court OKs Final Cash Collateral Access
----------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Texas,
Galveston Division, authorized Cutting Edge RV Services, Inc. to
use cash collateral on a final basis in accordance with its
agreement with CommunityBank of Texas, N.A., a division of
Allegiance Bank.
The parties agreed the Debtor may use cash collateral to pay
expenses in accordance with the operating budget.
On December 16, 2015, the Debtor executed certain Small Business
Administration loan documents in favor of CommunityBank:
* Borrowers: Heritage Pine Enterprises, LLC (non-Debtor
affiliated entity); Cutting Edge RV Services, Inc (Debtor).
* Facility A -- CommunityBank: $750,000 Permanent Loan
* Facility B -- $577,100 Interim Loan (six-month loan then
taken out by 2nd lien SBA financing)
Pursuant to the loan documents, CommunityBank holds valid and
perfected first priority liens and security interests in all
business assets of Debtor, both tangible and intangible, with the
exception of titled vehicles.
As of the Petition Date, all debt service for Facility A and
Facility B loan amounts are current. The debt is primarily serviced
by Heritage Pine Enterprises, LLC, which collects $12,500 in
monthly commercial lease payments from the Debtor.
As adequate protection, CommunityBank is granted a continued first
priority security interest in and lien upon all tangible and
intangible personal property acquired, generated or received by the
Debtor from and after the Petition Date. CommunityBank's
Replacement Lien will be valid, enforceable and perfected without
any further action by the Lender or the necessity of any filing or
execution of documents.
To the extent the replacement liens and adequate protection
payments provided in the Interim Order are insufficient to
adequately protect the Lender's interests in its Collateral,
CommunityBank will be entitled to a superpriority administrative
claim in an amount equivalent to any diminution in the overall
value of its Collateral (both Prepetition and Post Petition
Collateral) during the term of the Interim Order, pursuant to
section 507(b) of the Bankruptcy Code.
The Debtor are required to make payments to its landlord in the
amounts shown on the Operating Budget, beginning November 4, 2022,
and on the same day of each consecutive month thereafter.
A copy of the order is available at https://bit.ly/3v5KzeR from
PacerMonitor.com.
About Cutting Edge RV Services, Inc.
Cutting Edge RV Services, Inc. sought protection under Chapter 11
of the U.S. Bankruptcy Code (Bankr. S.D. Tex. Case No. 22-80182) on
October 10, 2022. In the petition signed by Lee Morris, vice
president, the Debtor disclosed up to $500,000 in assets and up to
$1 million in liabilities.
Judge Jeffrey P. Norman oversees the case.
Matthew Hoffman, Esq., at Hoffman & Saweris, P.C., is the Debtor's
legal counsel.
CYTODYN INC: All Three Proposals Passed at Annual Meeting
---------------------------------------------------------
CytoDyn Inc. held its 2022 Annual Meeting of Stockholders on Dec.
9, 2022, at which the stockholders:
(1) elected Tanya Durkee Urbach, Lishomwa C. Ndhlovu, M.D.,
Ph.D., Karen J. Brunke, Ph.D., Ryan Dunlap, and Stephen M. Simes as
directors to serve until the Company's 2023 annual meeting of
stockholders and until their successors are duly elected and
qualified or until their earlier death, resignation or removal;
(2) ratified the selection of Macias Gini & O'Connell LLP as the
Company's independent registered public accounting firm for the
fiscal year ending May 31, 2023; and
(3) approved, on an advisory basis, the compensation paid to the
Company's named executive officers.
About CytoDyn Inc.
Headquartered in Vancouver, Washington, CytoDyn Inc. --
http://www.cytodyn.com-- is a late-stage biotechnology company
focused on the clinical development and potential commercialization
of leronlimab (PRO 140), a CCR5 antagonist to treat HIV infection,
with the potential for multiple therapeutic indications.
Cytodyn reported a net loss of $210.82 million for the year ended
May 31, 2022, compared to a net loss of $176.47 million for the
year ended May 31, 2021. As of Aug. 31, 2022, the Company had
$28.39 million in total assets, $122.71 million in total
liabilities, and a total stockholders' deficit of $94.31 million.
San Jose, California-based Macias Gini & O'Connell LLP, the
Company's auditor since 2022, issued a "going concern"
qualification in its report dated Aug. 15, 2022, citing that the
Company incurred a net loss of approximately $210,820,000 for the
year ended May 31, 2022 and has an accumulated deficit of
approximately $766,131,000 through May 31, 2022, which raises
substantial doubt about its ability to continue as a going concern.
DYNATRACE LLC: Moody's Raises CFR to Ba2, Outlook Stable
--------------------------------------------------------
Moody's Investors Service upgraded Dynatrace LLC's Corporate Family
Rating to Ba2 from Ba3 and Probability of Default Rating to Ba2-PD
from Ba3-PD. Concurrently, Moody's assigned a Ba2 rating on the
company's new senior secured revolving credit facility. The SGL-1
Speculative Grade Liquidity ("SGL") rating is unchanged. The
outlook remains stable.
Upgrades:
Issuer: Dynatrace LLC
Corporate Family Rating, Upgraded to Ba2 from Ba3
Probability of Default Rating, Upgraded to Ba2-PD from Ba3-PD
Assignments:
Issuer: Dynatrace LLC
Backed Senior Secured Revolving Credit Facility, Assigned Ba2
(LGD3)
Outlook Actions:
Issuer: Dynatrace LLC
Outlook, Remains Stable
The rating upgrade reflects Dynatrace's improved scale and
continued debt reduction from strong free cash flow generation.
This is partly tempered by the lack of a clear financial policy
going forward and presumed desire to maintain flexibility to pursue
capability enhancing acquisitions.
RATINGS RATIONALE
Dynatrace's CFR reflects the company's growing scale as evidenced
by very strong annual recurring revenue (ARR) growth driven by a
strong product offering of application performance monitoring (APM)
and observability tools. Leverage was 2x (Moody's adjusted) at
September 30, 2022 and below 1x on a cash adjusted basis, prior to
the company's repayment of the remaining term loan B balance.
Moody's believes Dynatrace could support normalized debt to EBITDA
around mid-3x translating to mid-1x on a cash adjusted basis at the
current CFR.
Dynatrace's strong ARR growth is fueled by growing workloads among
its existing client base and increasing penetration among large
enterprises. Dynatrace's credit profile also considers the
competitive market for APM and observability software which has
seen a shift in new entrants, including Dynatrace, taking share
from legacy providers. The market is becoming increasingly
sophisticated requiring increased investment, potentially including
acquisitions.
The stable outlook reflects Moody's expectation that Dynatrace will
grow revenue around 20 percent annually over the next 12-18 months,
driven by growth in the company's sizable customer base, added
features, and new logo wins. Moody's expects Dynatrace's cost
pressures to be somewhat contained, balanced by increased
investment, maintaining at least stable margins, supporting solid
free cash flow.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Dynatrace's ratings could be downgraded if competitive pressures or
market deterioration lead to organic revenue declines, or if
additional debt is issued such that cash adjusted debt leverage
metrics exceed 2x on a cash adjusted basis. Ratings could be
upgraded if the company achieves materially greater revenue scale,
improved product diversity, and cash adjusted debt leverage
sustained around or below 1x.
Dynatrace's SGL-1 rating reflects very good liquidity supported by
robust cash balances of $342 million (as of September 30, 2022; pro
forma for the company's repayment of the remaining outstanding
principal balance of its Term Loan B), strong free cash flow
generation, and the new, undrawn $400 million revolving credit
facility. Moody's expects annualized free cash flow in excess of
$300 million over the next 12 to 18 months. The company is subject
to a total net leverage covenant of 4x on the revolver which can
temporarily increase to 4.5x upon certain qualified acquisitions of
at least $150 million in consideration.
ENVIRONMENTAL, SOCIAL AND GOVERNANCE (ESG) CONSIDERATIONS
Dynatrace's exposure to environmental risk is low, in line with the
technology services and software sector. Social risks from customer
relations and human capital factors are considered to be moderate,
in line with the technology services and software sector.
Governance risks are moderately negative. Dynatrace is a publicly
owned company with broader ownership following former private
equity owner Thoma Bravo's sell down of its majority stake to just
under 30%. However, Thoma has the right to nominate 30% of the
board, currently constituted at 9 members. The company is expected
to maintain moderate financial policies.
Dynatrace LLC (NYSE: DT) is a leader in enterprise application
performance monitoring (APM) software, providing a unified software
intelligence platform combining observability and application
security with AIOPS and automation. Headquartered in Waltham, MA,
the company reported revenues of approximately $1.04 billion as of
the LTM period ended September 30, 2022.
The principal methodology used in these ratings was Software
published in June 2022.
E. LYNN SCHOENMANN: Plaintiffs' Bid for Summary Judgment Denied
---------------------------------------------------------------
In the adversary case styled In re E. Lynn Schoenmann, Chapter 11,
Debtor. Stuart Gordon Schoenmann, individually and as executor of
the Estate of Donn R. Schoenmann; Celeste Lytle; Beth Schoenmann;
Colette Sims, Plaintiffs, v. E. Lynn Schoenmann, Defendant,
Bankruptcy Case No. 22-30028-DM, Adversary Case No. 22-3019, (N.D.
Cal.), Bankruptcy Judge Dennis Montali denies the Motion for
Partial Summary Judgment filed by the Plaintiffs Stuart Gordon
Schoenmann (individually and as executor of the estate of Donn R.
Schoenmann), Celeste Lytle, Beth Schoenmann, and Colette Sims.
The Court notes that the motion, although it is styled as a motion
for partial summary judgment, seeks summary judgment as to all
claims of nondischargeability asserted against the Defendant E.
Lynn Schoenmann. The motion is based mainly on the application of
issue preclusion to the findings within the Marin County Superior
Court's Tentative Decision which nullified a post marital agreement
between Lynn and her late husband, Donn.
There is no argument that the Parties involved in the Superior
Court matter and this case are identical -- the issues there were
actually litigated, and that the Tentative Decision is final for
purposes of the Plaintiffs'motion. Due to an agreed-upon
bifurcation of claims, the Tentative Decision determined only that
the post marital agreement was invalid.
The Tentative Decision determined that the post marital agreement
unfairly advantaged Lynn over Donn and further concluded that
Donn's assent to the post marital agreement was a result of undue
influence. Analyzing the elements of undue influence, the Tentative
Decision found that Donn's decision to sign the post marital
agreement was not freely and voluntarily made, Donn did not have
knowledge of all the facts surrounding the post marital agreement,
but that Donn did have a complete understanding of the effect of
the post marital agreement. To support its determination regarding
Donn's lack of knowledge, the Tentative Decision found that when
the post marital agreement was signed, Donn could not have known
the true value of all assets, though he did understand that those
assets would ultimately go to the Lynn as a result of the post
marital agreement.
The Plaintiffs rely on the Superior Court's determinations and the
underlying findings regarding the concealment or misrepresentation
of the value of real property and retirement account to support an
argument for summary judgment on both claims of
nondischargeability.
A successful claim of nondischargeability pursuant to 11 U.S.C.
subsection 523(a)(2)(A) requires a showing of five elements: "(1)
misrepresentation, fraudulent omission, or deceptive conduct by the
debtor; (2) knowledge of the falsity or deceptiveness of [the
debtor's] statement or conduct; (3) an intent to deceive; (4)
justifiable reliance by the creditor on the debtor's statement or
conduct; and (5) damage to the creditor proximately caused by his
reliance on the debtor's statement or conduct."
As to the first and third elements, the Plaintiffs argue these are
satisfied by the Tentative Decision's finding that Lynn
"affirmatively and intentionally misrepresented the values of both
the Mill Valley property as well as her retirement account." Next,
the Plaintiffs argue that the Superior Court also necessarily
determined the second element -- Lynn's knowledge of the falsity of
her statements -- because the post marital agreement was a document
relating to marital assets and Donn was essentially excused from
investigating the valuations provided by Lynn, and as the Superior
Court further found that Lynn affirmatively misrepresented the
value of her retirement account and the Mill Valley property.
As to the fourth element, no part of the Tentative Decision relates
to Donn's justifiable reliance. Instead, the Plaintiffs assert that
Donn's signing of the post marital agreement shows that he relied
on Lynn's misrepresentations. This assertion, however, is
contradicted by the Tentative Decision -- which found that Donn did
have a complete understanding of the effect of the post marital
agreement, and that he signed the post marital agreement because he
wished to live out his days in the family home and he saw the post
marital agreement as the only means to fulfill that wish.
Accordingly, the Court denies summary judgment as to subsection
(a)(2)(A) given the lack of facts in the Tentative Decision that
could establish the element of justifiable reliance, and the
absence of proof of any nondischargeable damages.
Lastly, the Plaintiffs assert that through the invalidated post
marital agreement Lynn has wrongfully taken an unspecified amount
of Donn's separate and community property. The Plaintiffs further
assert a litany of acts allegedly undertaken by Lynn to obtain the
post marital agreement as well as post-petition acts that allegedly
illustrate Lynn's misappropriation of Donn's assets. Far beyond the
Tentative Decision's findings regarding Lynn's retirement funds or
the value of the Mill Valley property, the Plaintiffs' contention
is that Lynn received community assets and has either not returned
them to the probate estate or disposed of them in the manner of a
fiduciary.
The Court maintains that any acts not conclusively established by
the Tentative Decision, material or not, are heavily and hotly
contested and not appropriate for evaluation at the summary
judgment stage. The Court notes that the conduct of Lynn that led
the Superior Court to find abuse and other acts to invalidate the
post marital agreement are not identical to the type of conduct
required to impose nondischargeable consequences on a fiduciary for
defalcation under subsection (a)(4).
The Court finds the Plaintiffs' contention extends far beyond the
scope of the Tentative Decision's findings that are binding on this
court. The Court holds that any assertion that community property
not having been turned over as a result of defalcation is to ignore
the procedural posture of this dispute. The Court rules that the
community property held by Lynn as a result of the invalidated post
marital agreement is also property of Lynn's bankruptcy estate, and
need not be turned over until this court so determines.
Additionally, while the Tentative Decision finds that Lynn's
misrepresentations regarding the value of her retirement account
were intentional, the Court notes that the Tentative Decision does
not discuss Lynn's state of mind when she actually transferred that
money in May 2016. The Court also notes that the understatement of
value of Mill Valley was a statement regarding the house's value in
its current state in August 2016. Because the Superior Court did
not analyze when these events occurred but instead focused on when
they were misrepresented, the Court cannot conclude that it
necessarily decided the same issue it must in order to impose
nondischargeability for her actions by way of issue preclusion.
In either case, the Court finds that the Plaintiffs have not shown
that the Tentative Decision imposed any damages at all for either
the transfer of the $480,000 from Lynn's retirement account in May,
2016 or the misrepresentation of the value of the Mill Valley
property to show nondischargeable damages. Hence, the Court denies
the Plaintiffs' motion for summary judgment because nothing in the
Tentative Decision establishes nondischargeable damages for this
conduct.
A full-text copy of the Memorandum Decision dated Nov. 28, 2022, is
available at https://tinyurl.com/6es5u9vm from Leagle.com.
A bout E. Lynn Schoenmann
E. Lynn Schoenmann sought Chapter 11 protection (Bankr. N.D. Cal.
Case No. 22-30028) on Jan. 14, 2022. She is represented by Michael
St. James, Esq.
EKSO BIONICS: Board Appoints Scott Davis as Director
----------------------------------------------------
Effective Dec. 8, 2022, the Board of Directors of Ekso Bionics
Holdings, Inc. appointed Scott G. Davis to serve as a director of
the Company, with Mr. Davis' term to expire as of the Company's
2023 Annual Meeting of Stockholders.
Mr. Davis was recently appointed to serve as the Company's chief
executive officer, prior to which he served as the Company's
president and chief operating officer.
About Ekso Bionics
Ekso Bionics Holdings, Inc. -- http://www.eksobionics.com--
designs, develops, and markets exoskeleton products that augment
human strength, endurance and mobility. Its exoskeleton technology
serves multiple markets and can be utilized both by able-bodied
persons and persons with physical disabilities.
Ekso Bionics reported a net loss of $9.76 million for the year
ended Dec. 31, 2021, a net loss of $15.83 million for the year
ended Dec. 31, 2020, a net loss of $12.13 million for the year
ended Dec. 31, 2019, and a net loss of $26.99 million for the year
ended Dec. 31, 2018. As of Sept. 30, 2022, the Company had $39.31
million in total assets, $10.70 million in total liabilities, and
$28.61 million in total stockholders' equity.
EMERALD GRANDE: Files for Chapter 11 Bankruptcy
-----------------------------------------------
Emerald Grande LLC filed for chapter 11 protection in the Southern
District of West Virginia.
Emerald Grande disclosed $3,009,951 in total assets against
$11,214,746 in total liabilities as of the bankruptcy filing. The
Debtor, a Single Asset Real Estate, owns commerical buildings
situated on 2.284 acres located at 5760, 5780, and 5790 MacCorkle
Avenue, SE, Charleston, West Virginia 25304, valued at $2,970,000.
Secured creditor People's Bank is owed $1,192,311. GAT LLC has an
unsecured claim of $10,000,000 on account of a purchased note from
Carter Bank, estimated deficiency from a sale of hotels.
The petition states that funds will be available to unsecured
creditors.
About Emerald Grande
Emerald Grande LLC is a Single Asset Real Estate (as defined in 11
U.S.C. Sec. 101(51B)).
Emerald Grande LLC filed a petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. S.D.W.V. Case No. 22-20189) on Dec. 3,
2022. In the petition filed by William A. Abruzzino, as Member of
Gold Coast Partners, LLC, the Debtor reported assets between $1
million and $10 million and liabilities between $10 million and $50
million.
The Debtor is represented by:
Joe M. Supple, Esq.
PO Box 190
Bonita Springs, FL 34133-0190
EMPIRE COUNTERTOPS: Seeks Chapter 11 to Stop Trustee Sale
---------------------------------------------------------
Empire Countertops LLC filed for chapter 11 protection in the
Eastern District of Texas.
Empire fabricates and installs countertops of various materials for
commercial and consumer projects throughout the DFW metroplex.
Empire's products are fabricated at its 8,000-square-foot plant
located at 1137 Enterprise Dr., Pilot Point, Texas 76258. Empire
sells direct to consumers through its website,
www.empirecountops.net, and through its commercial contacts to
commercial-grade projects. Currently, the company receives
approximately 70% of its revenue from consumer sales and 30% from
its commercial sales.
For the last 6 months, the Debtor had an average gross revenue of
$137,384 per month. In September, the gross sales revenue was
approximately $55,688.65. The estimated average monthly gross
sales income projected for the next six months is $259,433.34 per
month. Empire also anticipates a net income of not less than
$34,541.61 per month.
In August 2022, 340 Broadway Holdings, LLC as successor in interest
for Empire PP Holdings, LLC sent a Notice of Substitute Trustee's
Sale of the Debtor's real property located at 1137 Empire Dr.,
Pilot Point, Denton County, Texas. The Debtor sought a temporary
and permanent injunction of the sale in Empire Countertops, LLC v.
340 Broadway Holdings, LLC, Cause No. 22-7235-431, filed in the
431st District Court of Denton County, Texas. Ultimately, the
permanent injunction was unsuccessful, and a sale was scheduled for
December 6, 2022.
Unable to resolve the litigation with 340 Broadway Holdings and
facing a sale of its fabrication facility, Empire filed its
petition for bankruptcy protection under Chapter 11 of the
Bankruptcy Code.
The Debtor filed this bankruptcy to get some breathing room to
reorganize its obligations and preserve the going concern value of
its countertop fabrication business.
According to court filings, Empire Countertops estimates between $1
million and $10 million in debt owed to 1 to 49 creditors. The
petition states that funds will be available to unsecured
creditors.
The Debtor on the Petition Date filed motions to use cash
collateral and to pay prepetition wages and salaries.
About Empire Countertops
Empire Countertops LLC -- https://empirefab.com/ -- installs
countertops of various materials for commercial and consumer
projects throughout the DFW metroplex. Founded in 1989 by Curtis
"Mitch" Mahoney, the company has been in operation for more than
thirty years.
Empire Countertops LLC filed a petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. E.D. Tex. Case No. 22-41686) on Dec.
5, 2022. In the petition filed by Curtis M. Mahoney, as manager
and member, the Debtor reported assets and liabilities between $1
million and $10 million.
The Debtor is represented by:
Warren V. Norred, Esq.
Norred Law PLLC
1137 Enterprise Dr.
Pilot Point, TX 76258
FOX SUBACUTE: Addresses Philadelphia Plan Objection
---------------------------------------------------
Fox Subacute at Mechanicsburg, LLC and Fox Subacute at South
Philadelphia, LLC, are seeking confirmation of their Second Amended
Plan of Reorganization.
Under the Plan, Classes 4, 5A, 5B and 5C, are set forth as the
classes of claims which are eligible to vote under the Amended
Plan. Classes 4, 5A, 5B and 5C have all voted to accept the Plan
based upon the number of Claims which voted in favor of the Plan
and the dollar amount of such voting Claims.
The City of Philadelphia has filed an objection to the Amended
Plan. The City of Philadelphia has indicated the Objection is
resolved. The Debtors believe that notwithstanding this Objection,
the Plan can nonetheless be confirmed. The Objection of the City
of Philadelphia is as to when the Administrative Claims will be
paid and as to what steps a creditor can take in the event of a
default. It is believed that both such items are contained in the
Plan of Reorganization.
Specifically, Section 4.2.1 of the Plan sets forth, in part, that
all Administrative Claims, as allowed by the Court, shall be paid
as they become due in the ordinary course of business on or before
the Effective Date of the Plan. It appears that the City of
Philadelphia's Objection relates to the fact that the Plan provides
in Section 4.2.1 that Administrative Claims have to be allowed by
the Court and the City does not wish to file an Application or
Motion as to such alleged Administrative Claim. It is believed
that in order for a Claim to be allowed, it must either be
scheduled or filed with respect to non-Administrative Claims. With
respect to Administrative Claims, no Application or Motion is
necessary. The Debtors are prepared to propose in the Confirmation
Order that the words in Section 4.2.1 Aas allowed by the Court@ be
deleted. Further, the amounts claimed by the City of Philadelphia
were not, within the Debtors' knowledge, previously sent to the
Debtors and the Debtors were unaware that any amounts are owed to
the City of Philadelphia. To the extent that such Administrative
Claim is determined to be owed, they will be paid shortly by the
Debtor, South Philadelphia.
The second issue in the Objection of the City of Philadelphia
relates to the fact that it claims that the only default provision
contained in the Plan is only with respect to PeoplesBank. The
last paragraph of Section 12.1 of the Plan sets forth that no
default may occur until there is 20 days notice of non-payment.
This is actually a more liberal provision than that proposed by the
City of Philadelphia, which sets forth 30 days to provide an
880-daynotice. This issue is now resolved.
Because Classes 4, 5A, 5B and 5C have voted to accept the Plan,
there is at least one class of claims which has accepted the Plan,
without consideration of insiders. All Classes of Claims that are
permitted to vote on the Plan have voted in favor of the Plan.
Thus, the Plan can be confirmed under Section 1129(a) of the
Bankruptcy Code.
The Debtors believe that all of the necessary requirements pursuant
to Section 1129(a) of the Bankruptcy Code have been met for
confirmation. All Classes of Claims, including the last class of
Claims permitted to vote, thus, Classes 5A, 5B and 5C (the
Unsecured Creditors), have voted in favor of the Plan. Thus, the
cramdown provisions of Section 1129(a) as to Unsecured Creditors is
not necessary.
With respect to Class 4, the Claim holder in such Class is
receiving property of a value equal to the value of its secured
Claim. Further, such Claim holder has voted in favor of the Plan.
The Debtors believe that its Plan is feasible as demonstrated by
its operations during Chapter 11, and as set forth in the
projections attached to the Disclosure Statement filed in this
case. The operations show that the Debtors are generating
sufficient funds to pay the Claims as set forth in the Plan.
The Debtor's counsel:
Robert E. Chernicoff, Esq.
CUNNINGHAM, CHERNICOFF & WARSHAWSKY, P.C.
2320 North Second Street, P. O. Box 60457
Harrisburg, PA 17106-0457
Tel: (717) 238-6570
E-mail: rec@cclawpc.com
About Fox Subacute at Mechanicsburg
Fox Subacute At Mechanicsburg, LLC is a skilled nursing facility in
Pennsylvania that specializes in pulmonary, neurological, and
rehabilitative care for patients with degenerative neurological and
neuromuscular disease; and pulmonary care and ventilator
requirements with an emphasis on vent weaning. Its facilities are
located in Plymouth Meeting, Warrington, Mechanicsburg and
Philadelphia, Pa., and are licensed by the PA Department of
Health.
On Nov. 1, 2019, Fox Subacute at Mechanicsburg and its affiliates
sought Chapter 11 protection (Bankr. M.D. Pa. Lead Case No.
19-04714). Fox Subacute at Mechanicsburg was estimated to have $1
million to $10 million in assets and liabilities as of the
bankruptcy filing.
Judge Henry W. Van Eck oversees the cases.
The Debtors tapped Cunningham, Chernicoff & Warshawsky, P.C., as
their legal counsel, Kennedy P.C. as special counsel, Isdaner &
Company, LLC as accountant, and Three Twenty-One Capital Partners,
LLC as investment banker.
The Office of the U.S. Trustee appointed an official committee of
unsecured creditors on Dec. 11, 2019. The committee is represented
by Flaster/Greenberg P.C.
FREEMANVILLE LIFEHOPE: Files for Chapter 11 Bankruptcy
------------------------------------------------------
Freemanville Lifehope House LLC and affiliate Alpharetta Lifehope
Land SPE LLC filed for chapter 11 protection in the Northern
District of Georgia.
According to court filings, Freemanville Lifehope House estimates
between $1 million and $10 million in debt owed to 1 to 49
creditors. The petition states that funds will be available to
unsecured creditors.
Scott Honan is the co-founder and CEO of LifeHope, and Richmond
Honan Development and Acquisitions, a 45-year-old real estate
healthcare development company with a focus on healthcare and
medical office buildings.
Mr. Honan also founded Lifehope, a medical ministry in 2006. Mr.
Honan's passion for God's children in his community and
strong faith, has led him to expand Lifehope into health ventures
with physicians with innovative procedures to redefine a
healthcare platform that focuses on restoration, transforming
lives physically, emotionally, and spiritually.
The LifeHope team manages over five-million sq. ft. of medical
office space. Its Class A buildings are located next to major
hospitals and have easy access off major freeways with plenty of
parking space.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Jan. 6, 2023, at 11:00 AM.
About Freemanville Lifehope House
Freemanville Lifehope House LLC is primarily engaged in renting and
leasing real estate properties.
Freemanville Lifehope House LLC filed a petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No.
22-59875) on Dec. 5, 2022. In the petition filed by Mark Allen, as
manager, the Debtor reported assets and liabilities between $1
million and $10 million.
Alpharetta Lifehope Land SPE LLC filed a petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga. Case No.
22-59897) on Dec. 5, 2022. In the petition filed by Mark Allen, as
manager, the Debtor reported assets up to $50,000 and liabilities
between $1 million and $10 million
The Debtors are represented by:
Ian M. Falcone, Esq.
The Falcone Law Firm, P.C.
11680 Great Oaks Way, Suite 120
Alpharetta, GA 30022
FTX TRADING: SBF Taps Mark Cohen as Defense Lawyer
--------------------------------------------------
Olga Kharif and Ava Benny-Morrison of Bloomberg News report that
Sam Bankman-Fried, the embattled co-founder of bankrupt crypto
exchange FTX, has retained New York defense attorney Mark Cohen to
represent him, according to Bankman-Fried's spokesperson Mark
Botnick.
According to Bloomberg, Mr. Cohen was previously part of the team
that represented convicted sex trafficker Ghislaine Maxwell. He
also successfully defended analyst Peter Black against a Securities
and Exchange Commission suit in a 2014 trial. Cohen's hiring by
Bankman-Fried was first reported by Reuters.
According to https://www.cohengresser.com/, Mark S. Cohen is the
co-founder of Cohen & Gresser, and is the managing partner of C&G's
New York office, and head of the firm's Litigation & Arbitration
and White Collar Defense & Regulation groups. Mark's litigation
practice includes complex commercial disputes, real estate and
construction litigation, securities litigation, employment
litigation, and antitrust litigation. He also represents
companies, corporate boards, board committees, and individual
clients in white collar criminal cases, federal and state
regulatory proceedings, and corporate internal investigations.
About FTX Group
FTX is the world's second-largest cryptocurrency firm. FTX is a
cryptocurrency exchange built by traders, for traders. FTX offers
innovative products including industry-first derivatives, options,
volatility products and leveraged tokens.
Then CEO and co-founder Sam Bankman-Fried said Nov. 10, 2022, that
FTX paused customer withdrawals after it was hit with roughly $5
billion worth of withdrawal requests.
Faced with liquidity issues, FTX on Nov. 9 struck a deal to sell
itself to its giant rival Binance, but Binance walked away from the
deal the next day amid reports on FTX regarding mishandled customer
funds and alleged US agency investigations.
At 4:30 a.m. on Nov. 11, Bankman-Fried ultimately agreed to step
aside, and restructuring vet John J. Ray III was quickly named new
CEO.
FTX Trading Ltd (d/b/a FTX.com), West Realm Shires Services Inc.
(d/b/a FTX US), Alameda Research Ltd. and certain affiliated
companies then commenced Chapter 11 proceedings (Bankr. D. Del.
Lead Case No. 22-11068) on an emergency basis on Nov. 11, 2022.
Additional entities sought Chapter 11 protection on Nov. 14, 2022.
FTX Trading and its affiliates each listed $10 billion to $50
million in assets and liabilities, making FTX the biggest
bankruptcy filer in the US this year. According to Reuters, SBF
shared a document with investors on Nov. 10 showing FTX had $13.86
billion in liabilities and $14.6 billion in assets. However, only
$900 million of those assets were liquid, leading to the cash
crunch that ended with the company filing for bankruptcy.
The Hon. John T. Dorsey is the case judge.
Andrew G. Dietderich, James L. Bromley, Brian D. Glueckstein and
Alexa J. Kranzley at Sullivan & Cromwell LLP in New York, serve as
the Debtors' counsel.
Adam G. Landis, Kimberly A. Brown and Matthew R. Pierce at LANDIS
RATH & COBB LLP in Wilmington serve as local bankruptcy counsel to
FTX Group.
Alvarez & Marsal North America, LLC, is the Debtors' financial
advisor.
Kroll is the claims agent, maintaining the page
https://cases.ra.kroll.com/FTX/Home-Index
Lawyers at Paul Weiss represented SBF but later renounced
representing the entrepreneur due to a conflict of interest.
G.D. III: Trustee Taps Miles & Stockbridge as Legal Counsel
-----------------------------------------------------------
Patricia Jefferson, the trustee appointed in G.D. III, Inc.'s
Chapter 11 case, received approval from the U.S. Bankruptcy Court
for the District of Maryland to tap her own firm, Miles &
Stockbridge P.C., as her legal counsel in the bankruptcy case.
The firm's services include:
(a) advising the Chapter 11 trustee with respect to her rights,
duties, and powers in the Debtor's Chapter 11 case, including
investigating and prosecuting claims and causes of action;
(b) assisting and advising the trustee in her consultations with
the Debtor and other parties in interest relative to the
administration of the case;
(c) assisting the trustee in analyzing the claims of creditors
and in negotiating with holders of claims;
(d) assisting the trustee in her investigation of the acts,
conduct, assets, liabilities, and financial condition of the Debtor
and of the operation of the Debtor's business;
(e) assisting the trustee in her investigation of the liens and
claims of the Debtor's pre-bankruptcy creditors and the prosecution
of any claims or causes of action revealed by such investigation;
(f) assisting the trustee in connection with asset
dispositions;
(g) assisting the trustee in proposing a plan of reorganization
and preparation of an accompanying disclosure statement and related
documents;
(h) assisting and advising the trustee as to her communications
with secured and unsecured creditors;
(i) representing the trustee at hearings and other proceedings;
(j) reviewing and analyzing applications, orders, statements of
operations and schedules filed with the court;
(k) assisting the trustee in preparing pleadings and
applications as may be necessary in furtherance of the trustee's
interests and objectives;
(l) other necessary legal services.
Miles & Stockbridge will be paid at these rates:
Principals $415 to $1,025 per hour
Intellectual Property $225 to $750 per hour
Special Tax Counsel $425 to $1,025 per hour
Associate $285 to $495 per hour
Staff Attorney/Of Counsel $305 to $800 per hour
Paralegal $195 to $390 per hour
Law Clerks & Law Graduates $275 to $375 per hour
In addition, the firm will be reimbursed for out-of-pocket expenses
incurred.
As disclosed in court filings, Miles & Stockbridge is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached at:
Patricia B. Jefferson, Esq.
Emily K. Devan, Esq.
Addison J. Chappell
Miles & Stockbridge P.C.
100 Light Street, 10th Floor
Baltimore, MD 21202
Tel: (410) 385-3405
Email: bktrustee@milesstockbridge.com
edevan@milesstockbridge.com
chappell@milesstockbridge.com
About G.D. III
G.D. III, Inc. is a Baltimore-based company engaged in renting and
leasing real estate properties.
G.D. III filed its voluntary petition for relief under Chapter 11
of the Bankruptcy Code (Bankr. D. Md. Case No. 22-12393) on May 3,
2022, with $6,500,000 in assets and $7,549,273 in liabilities.
George Divel, III, president of G.D. III, signed the petition.
Judge Michelle M. Harner presides over the case.
Timothy Mummert, Esq., at Mummert Law Firm and Richard Fleischer,
CPA serve as the Debtor's legal counsel and accountant,
respectively.
Patricia Jefferson, the Chapter 11 trustee appointed in the
Debtor's case, is represented by Miles & Stockbridge P.C.
GIRARDI & KEESE: Erika's Earrings Sold for $312,000 at Auction
--------------------------------------------------------------
Gina Kim of Law360 reports that Erika Girardi's notorious diamond
earrings, which were relinquished to the bankruptcy trustee for her
estranged husband's now-defunct law firm following a court order,
sold at auction to an anonymous remote bidder for $312,500,
including fees.
At the behest of the Trustee, ThreeSixty Asset Advisors, LLC,
conducted an auction Dec. 7, 2022, for various items of fine
jewelry and watches from Cartier, Tiffany and others, including the
Erika Jayne Girardi earrings – 7.09 & 7.02 karats (confirmed at
6.01 and 6.57 karats per GIA Certs on auction website).
About Girardi & Keese
Girardi and Keese or Girardi & Keese was a Los Angeles-based law
firm founded in 1965 by lawyers Thomas Girardi and Robert Keese.
It served clients in California in a variety of legal areas. It was
known for representing plaintiffs against major corporations.
An involuntary Chapter 7 petition (Bankr. C.D. Cal. Case No.
20-21022) was filed in December 2020 against GIRARDI KEESE by
alleged creditors Jill O'Callahan, Robert M. Keese, John Abassian,
Erika Saldana, Virginia Antonio, and Kimberly Archie.
The petitioners' attorneys:
Andrew Goodman
Goodman Law Offices, Apc
Tel: 818-802-5044
E-mail: agoodman@andyglaw.com
Elissa D. Miller, a member of the firm SulmeyerKupetz, has been
appointed as Chapter 7 trustee for GIRARDI KEESE. The Chapter 7
trustee can be reached at:
Elissa D. Miller
333 South Grand Ave., Suite 3400
Los Angeles, California 90071-1406
Telephone: (213) 626-2311
Facsimile: (213) 629-4520
E-mail: emiller@sulmeyerlaw.com
An involuntary Chapter 7 petition was also filed against Thomas
Vincent Girardi (Case No. 20-21020) on Dec. 18, 2020. The Chapter
7
trustee can be reached at:
Jason M. Rund
Email: trustee@srlawyers.com
840 Apollo Street, Suite 351
El Segundo, CA 90245
Telephone: (310) 640-1200
GUNITE MASTERS: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: Gunite Masters of Texas, LLC
9316 Reid Lake Dr.
Houston, TX 77064-7750
Chapter 11 Petition Date: December 12, 2022
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 22-33705
Judge: Hon. Jeffrey P. Norman
Debtor's Counsel: Reese W. Baker, Esq.
BAKER & ASSOCIATES
950 Echo Ln Ste 300
Houston, TX 77024-2824
Email: courtdocs@bakerassociates.net
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Scott Hebert as chief operating
officer.
The Debtor failed to include in the petition a list of its 20
largest unsecured creditors.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/SQR3UMY/Gunite_Masters_of_Texas_LLC__txsbke-22-33705__0002.0.pdf?mcid=tGE4TAMA
H&S ALANG: Court Approves Disclosure Statement
----------------------------------------------
Judge Brenda T. Rhoades has entered an order approving the Amended
Disclosure Statement of H&S Alang, LLC, dated Nov. 30, 2022.
A hearing on the Debtor's First Amended Plan of Reorganization will
be held on Jan. 24, 2023, at 9:30 a.m. before the Honorable Chief
Judge Brenda T. Rhoades, United States Bankruptcy Court, 660 North
Central Expressway, Suite 300B, Plano, Texas 75074.
Objections to the Confirmation of the Plan must be filed and served
no later than January 13, 2023.
The deadline for submitting ballots is January 18, 2023.
About H&S Alang
H&S Alang, LLC, operates a Hampton Inn hotel located in Pearsall,
Texas. H&S Alang, LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. E.D. Tex. Case No. 22-40712) on June
6, 2022. In the petition filed by Jaspreet S. Alang, manager, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Brenda T. Rhoades oversees the case.
Joyce W. Lindauer, Esq., at Joyce W. Lindauer Attorney, PLLC, is
the Debtor's counsel.
Pearsall Holdings, LLC, as secured creditor, is represented by
Kenneth Stohner Jr., Esq. at Jackson Walker LLP.
HINTONS5 LLC: Unsecureds Owed $5K to Get $500 in Sale Plan
----------------------------------------------------------
Hintons5, LLC, submitted a Plan of Liquidation and a Disclosure
Statement.
The Plan of Liquidation is based on the Debtor's belief that the
cash flow of the debtor cannot sustain a Chapter 11 plan of
reorganization. As such, the debtor filed an Amended Motion,
pursuant to 11 U.S.C. §363, seeking to sell its real property, and
sole asset, located at 40-50 Dolson Avenue, Middletown, New York
(the "Property"), free and clear of liens, claims and encumbrances.
The highest and best offer received by the debtor for the
Property, after an auction held on Oct. 19, 2022 was $325,000,
submitted by Marcus Neuah.
Under the Plan, Class 3 Unsecured Claims will be paid 10% of its
claim from the proceeds remaining from the sale of the Debtor's
Property, after distributions to the debtor's Administrative
Claims. The claim in this class totals approximately $5,000. The
disbursement to be made pursuant to the Plan shall be in the total
amount of $500. Class 3 is impaired and claimants' vote will be
solicited.
Attorneys for the Debtor:
Andrea B. Malin, Esq.
Michelle L. Trier, Esq.
GENOVA, MALIN & TRIER, LLP
Hampton Business Center, 1136 Route 9
Wappingers Falls, NY 12590
Tel: (845) 298-1600
A copy of the Disclosure Statement dated Dec. 2, 2022, is available
at https://bit.ly/3FpKJn5 from PacerMonitor.com.
About Hintons5 LLC
Hintons5 LLC, a Middletown, N.Y.-based single asset real estate
corporation, sought protection under Chapter 11 of the Bankruptcy
Code (Bankr. S.D.N.Y. Case No. 20-35871) on Aug. 20, 2020. At the
time of the filing, the Debtor disclosed between $500,001 and $1
million in both assets and liabilities. The Debtor tapped Genova &
Malin as bankruptcy counsel and McCabe & Mack LLP as special
counsel.
HOUSTON AMERICAN: Increases Interest in Colombian CPO-11 Project
----------------------------------------------------------------
Houston American Energy Corp. said it has acquired an additional
interest in Hupecol Meta, LLC.
Hupecol Meta owns the 639,405 gross acre CPO-11 block in the Llanos
Basin in Colombia, comprised of the 69,128 acre Venus Exploration
area, operated by Hupecol, and 570,277 acres which was 50% farmed
out to Parex Resources by Hupecol. In total, the CPO-11 block
covers almost 1000 square miles with multiple identified leads and
prospects expected to support a multi-well drilling program.
Through its membership interest in Hupecol Meta, Houston American
now holds an approximately 16% interest in the Venus Exploration
area and an approximately 8% interest in the remainder of the
block.
In the Venus Exploration Area, Hupecol Meta now operates two
producing wells, the Saturno ST1 and Venus 2A wells. A 3D seismic
acquisition program is planned to support future development of the
Venus Exploration Area.
John Terwilliger, CEO of Houston American, stated, "We are excited
about the increase of our interest in the CPO-11 block, the
progress made by Hupecol Meta to date and the outlook for
development of the block. Hupecol Meta's deep history of operating
in Colombia is paying dividends with their securing permits to
support drilling and production operations and favorable initial
operating results on our first two wells. The commitment to move
forward with a seismic acquisition program to support future
development of the block reflects our belief in the potential of
the block based on initial operating results on our first two
wells."
About Houston American Energy
Based in Houston, Texas, Houston American Energy Corp. is an
independent oil and gas company focused on the development,
exploration, exploitation, acquisition, and production of natural
gas and crude oil properties. The Company's principal properties,
and operations are in the U.S. Permian Basin. Additionally, it has
properties in the U.S. Gulf Coast region, particularly Texas and
Louisiana, and in the South American country of Colombia.
Houston American reported a net loss of $1.02 million for the year
ended Dec. 31, 2021, a net loss of $4.04 million for the year ended
Dec. 31, 2020, and a net loss of $2.51 million for the year ended
Dec. 31, 2019. As of Sept. 30, 2022, the Company had $10.35
million in total assets, $385,410 in total liabilities, and $9.96
million in total shareholders' equity.
IBEC LANGUAGE: Court Confirms Reorganization Plan
-------------------------------------------------
Judge Sean H. Lane has entered an order confirming the First
Amended Chapter 11 Plan of Reorganization of Ibec Language
Institute, Inc.
The Plan together with all exhibits thereto, this Order, and their
respective provisions shall be binding upon the Debtor, all parties
in interest, and any and all creditors holding claims of any kind,
whether secured or unsecured, contingent or non-contingent,
unliquidated or liquidated, against the Debtor and/or its property.
Kazuo Endo, the Debtor's President, is authorized, empowered and
directed to execute any and all documents and bind the Debtor in
all ways necessary to carrying out the provisions of the Plan
without the need for further Court order.
This Order is a judgment for purposes of Fed. R. Civ. P. 58 as
incorporated into the Bankruptcy Code by Bankruptcy Rule 9021. The
period in which an appeal must be filed shall commence immediately
upon the entry of this Order on the docket of the Chapter 11 case
maintained by the clerk of the Court.
Upon entry of this Order, the Debtor shall be discharged from all
pre-Petition Date Claims as set forth in section 1141(d)(1) of the
Bankruptcy Code and upon the Effective Date, pursuant to section
1141(c) of the Bankruptcy Code, except as specifically provided for
in the Plan, all property of the Debtor's estate shall vest in the
Reorganized Debtor, free and clear of all Liens and Claims.
As shown by the Certificate of Service of Bryn A. Leonardo duly
declared to on October 18, 2022, proper, timely, adequate and
sufficient notice of the Hearing to consider confirmation of the
Plan to all Creditors, Interest holders and parties in interest has
been provided in accordance with the Scheduling Order and
applicable Federal Rules of Bankruptcy Procedure. No further or
other notice of the Hearing or entry of this Order is necessary.
As set forth in the Certificate of Balloting, the Plan has been
accepted in writing pursuant to Section 1126(c) of the Bankruptcy
Code by the impaired class of creditors (Class 2), in that, of the
holders of Class 2 claims that have voted, more than 2/3 in amount
and more than 1/2 in number of the allowed claims of such Class
have accepted the Plan.
The Plan satisfies the requirements of Sections 1122 and 1123 of
the Bankruptcy Code and the classification of Claims and Interests
are reasonable, proper and not impermissibly discriminatory with
respect to each Class of Impaired Claims that has not voted to
accept or reject the Plan.
With respect to each Impaired class of Claims or Interests, each
holder of a claim as defined in Section 101(5) of the Bankruptcy
Code or Interest of such Class has either affirmatively accepted
the Plan or will receive or retain under the Plan on account of
such Claim or Interest, property of a value, as of the Effective
Date of the Plan, that is not less than the amount that such holder
would so receive or retain if the Debtor was liquidated under
chapter 7 of the Bankruptcy Code on the Effective Date.
About IBEC Language
IBEC Language Institute, Inc., offers courses on American culture
and business English communication skill development to Japanese
business people and their families in New York City.
IBEC Language filed a Chapter 11 bankruptcy petition (Bankr.
S.D.N.Y. Case No. 21-22455) on Aug. 6, 2021. The Debtor was
estimated to have less than $100,000 in assets and less than
$500,000 in liabilities as of the bankruptcy filing. The Debtor is
represented by Dawn Kirby, Esq. of KIRBY AISNER & CURLEY LLP.
ICEBOX HOLDCO: S&P Rates $150MM First-Lien Term Loan 'B-'
---------------------------------------------------------
S&P Global Ratings assigned its 'B-' issue-level rating and '3'
recovery rating to Icebox Holdco III Inc.'s (doing business as
DiversiTech) $150 million first-lien delayed draw term loan (DDTL)
due 2028. The '3' recovery rating indicates S&P's expectation for
meaningful (50%-70%; rounded estimate: 50%) recovery in the event
of a payment default. The company recently drew down the full
amount of the DDTL facility and used the proceeds to fund its
acquisitions of three Europe-based manufacturers of trunking,
brackets, and other parts and supplies focused on heat pump
technologies. The acquisitions will expand DiversiTech's geographic
presence to Europe and increase its exposure to higher-growth heat
pump products. The acquisitions do not materially alter S&P's
forecast that the company's S&P Global Ratings-adjusted leverage
will remain high. Pro forma for the full-year impact of the
acquisitions and the draw on the DDTL facility, it forecasts its
S&P Global Ratings-adjusted debt to EBITDA will be in the 8x-9x
range through 2023.
Duluth, Ga.-based DiversiTech Holdings Inc. is a manufacturer and
supplier of aftermarket heating, ventilation, air conditioning
(HVAC) components with a broad range of products that largely acts
as a supplier to HVAC wholesalers. The company manufactures a
majority of its products but also distributes products produced by
its manufacturing partners or other third parties. It operates in
the U.S., the U.K., Canada, and Europe. The company is controlled
by Partners Group, a global private markets firm.
ISSUE RATINGS--RECOVERY ANALYSIS
Key analytical factors
-- S&P's issue-level rating on DiversiTech's $725 million
first-lien term loan and $150 million first-lien DDTL due 2028 is
'B-'. The '3' recovery rating indicates its expectation for
meaningful (50%-70%; rounded estimate: 50%) recovery in the event
of a payment default.
-- S&P's issue-level rating on DiversiTech's $240 million
second-lien term loan due 2029 is 'CCC'. The '6' recovery rating
indicates its expectation for negligible (0%-10%; rounded estimate:
0%) recovery in the event of a payment default.
-- S&P's simulated default scenario contemplates a default
occurring in 2024 due to a severe downturn in the company's end
markets and heightened competition, which materially reduce its
revenue and profitability. At this point, S&P assumes DiversiTech's
liquidity and capital resources would be strained to the point that
it would be unable to continue to operate without filing for
bankruptcy.
-- S&P's value DiversiTech on a going-concern basis using a 5x
multiple of S&P's projected emergence EBITDA of about $106
million.
-- The 5x multiple reflects the company's limited scale and narrow
scope of operations and is in line with the multiples S&P's use for
its capital goods industry peers.
-- S&P's recovery analysis assumes that in a hypothetical
bankruptcy scenario 85% of the company's $100 million revolver
would be drawn.
Simulated default assumptions
-- Year of default: 2024
-- EBITDA at emergence: $106 million
-- Implied enterprise value (EV) multiple: 5x
-- Jurisdiction: U.S.
Simplified waterfall
-- Net enterprise value at default (after 5% administrative
costs): $502 million
-- Valuation split (obligors/nonobligors): 90%/10%
-- Value available to first-lien debt claims from collateral and
pro rata share of non-collateral claims: $496 million
-- Estimated first-lien claims: $973 million
--Recovery expectations: 50%-70% (rounded estimate: 50%)
-- Value available to second-lien claims: $6 million
-- Estimated second-lien debt claims: $251 million
--Recovery expectations: 0%-10% (rounded estimate: 0%)
Note: S&P said, "Debt amounts include six months of accrued
interest that we assume will be owed at default. Collateral value
includes asset pledges from obligors (after priority claims) plus
equity pledges in nonobligors. We generally assume usage of 85% for
cash revolving credit facilities and 60% for asset-based lending
(ABL) revolving facilities at default."
INFINERA CORP: Board Approves Amended and Restated Bylaws
---------------------------------------------------------
The Board of Directors of Infinera Corporation approved the
Company's Amended and Restated Bylaws, effective as of Dec. 6,
2022, according to a Form 8-K filed with the Securities and
Exchange Commission.
Among other things, the Amended and Restated Bylaws update and
revise the advance notice procedures for the nomination of
directors and the proposal of other business at stockholder
meetings, change certain provisions relating to stockholder
nominees for election as a director to address the universal proxy
rules adopted by the Securities and Exchange Commission, clarify
certain procedures related to the conduct of stockholder meetings,
and reflect various other technical edits, clarifying updates, and
ministerial changes, including to account for recent amendments in
the Delaware General Corporation Law.
About Infinera Corp.
Headquartered in Sunnyvale, Calif., Infinera Corp. --
www.infinera.com -- is a global supplier of innovative networking
solutions that enable carriers, cloud operators, governments, and
enterprises to scale network bandwidth, accelerate service
innovation, and automate network operations. The Infinera
end-to-end packet-optical portfolio delivers industry-leading
economics and performance in long-haul, submarine, data center
interconnect, and metro transport applications.
Infinera reported a net loss of $170.78 million for the year ended
Dec. 25, 2021, a net loss of $206.72 million for the year ended
Dec. 26, 2020, and a net loss of $386.62 million for the year ended
Dec. 28, 2019. As of Sept. 24, 2022, the Company had $1.50 billion
in total assets, $578.18 million in total current liabilities,
$667.07 million in long-term debt, $18.21 million in long-term
accrued warranty, $22.59 million in long-term deferred revenue,
$1.94 million in long-term deferred tax liability, $47.29 million
in long-term operating lease liabilities, $50.20 million in other
long-term liabilities, and $114.20 million in total stockholders'
equity.
JUUL LABS: Settles More Than 5,000 Youth Vaping Lawsuits
--------------------------------------------------------
Juul Labs said Dec. 6, 2022, it has reached settlements with
plaintiffs in the federal multidistrict litigation (MDL) and
related "JUUL Labs Product Cases" (JCCP) that have been
consolidated in the United States District Court for the Northern
District of California.
These settlements represent a major step toward strengthening Juul
Labs' operations and securing the company's path forward to fulfill
its mission to transition adult smokers away from combustible
cigarettes while combating underage use.
The global resolution covers more than 5,000 cases brought by
approximately 10,000 plaintiffs against Juul Labs and its officers
and directors. These cases in the MDL and JCCP, and subject to the
resolution, come from the following groups: personal injury,
consumer class action, government entity, and Native American
tribes. As part of the settlement and court process, Juul Labs
cannot disclose the settlement amount at this time, but has secured
an equity investment to fund the resolution.
Over the past year, Juul Labs also has settled with 37 states and
territories and it remains in ongoing discussions with other key
stakeholders to resolve the remaining litigation.
As the company announced in November, Juul Labs has taken a series
of steps to stabilize its business operations and address past
legal issues. With both new investments in the company's mission
and a resolution like the one achieved today, Juul Labs is charting
a path forward to continue to advance tobacco harm reduction
through science and technology, for over 31 million adult smokers
in the U.S. and over 1 billion adult smokers worldwide.
* * *
Malathi Nayak of Bloomberg News reports that, according to a recent
court filing, the sprawling Juul litigation in San Francisco
federal court included about 3,234 personal injury suits and more
than 1,313 complaints brought by government entities and native
Indian tribes, in addition to a proposed class-action fight.
Juul, according to Bloomberg, is grappling with declining sales
stemming from restrictions on flavored vape products by the Federal
Drug Administration and health officials calling for increased
warnings on the health effects of vaping.
Bloomberg recounts that the company reached an agreement in
principle in September to pay $438.5 million to 33 states to
resolve a two-year bipartisan probe into its marketing and sales
practices, particularly claims that it marketed addictive nicotine
products to children.
The first jury trial among the San Francisco cases was set for
January after multiple delays. Juul co-founders Adam Bowen and
James Monsees, who were crowned e-cigarette billionaires after
Marlboro maker Altria Group Inc. acquired about a third of their
company in 2018, were expected to take the witness stand alongside
a few Altria executives.
"The scope of these suits is enormous," Sarah London, one of the
lead lawyers for the plaintiffs, told Bloomberg. "These
settlements will put meaningful compensation in hands of victims
and their families, get real funds to schools for abatement
programs, and help government and tribal entities prevent youth use
of e-cigarettes across the US."
The proposed settlement requires court approval.
The case is In re: Juul Labs Inc. Marketing, Sales Practices &
Products Liability Litigation, 19-md-02913, U.S. District Court,
Northern District of California (San Francisco).
About Juul Labs Inc.
JUUL Labs, Inc., formerly known as Pax Labs, Inc., is an American
electronic cigarette company, with its principal place of business
in San Francisco, California.
Marlboro cigarette maker Altria Group Inc (MO.N) paid $12.8 billion
in 2018 for a 35% stake in Juul. Altria valued that stake at $450
million as of June 30, 2022.
Juul had been the market leader in e-cigarettes since 2018,
according to Euromonitor International. As of 2020, the company
held 54.7% share of the $9.38 billion U.S. e-vapor market.
On June 23, 2022, the U.S. Food and Drug Administration ordered
Juul to remove its e-cigarettes from the U.S. market effective
immediately, saying that Juul had failed to show the sale of its
products would be appropriate for public health.
The Columbia Circuit Court of Appeals on June 24, 2022, granted
Juul's emergency request for a stay, pending its appeal of the
decision. The FDA later said it was withholding the ban as it was
doing an additional review of the company's marketing application.
In July 2022, reports said that Juul was considering its options,
including bankruptcy, and reportedly hired Kirkland & Ellis and
Alvarez & Marsal, as well as bankers at Centerview Partners.
On Sept. 6, 2022, Juul agreed to pay $438.5 million to settle
claims by 34 U.S. states and territories over its marketing and
sales practices, including that it improperly courted teenage
buyers.
On Sept. 20, 2022, Juul Labs sued the FDA in a federal court in
Washington, D.C., over the agency's refusal to disclose documents
supporting its order banning the company from selling e-cigarettes.
The case is Juul Labs Inc v Food & Drug Administration, U.S.
District Court, District of Columbia, No. 22-02853.
KEYWAY APARTMENT: Trustee Taps Miles & Stockbridge as Legal Counsel
-------------------------------------------------------------------
Patricia Jefferson, the trustee appointed in Keyway Apartment
Rentals, LLC's Chapter 11 case, received approval from the U.S.
Bankruptcy Court for the District of Maryland to tap her own firm,
Miles & Stockbridge P.C., as her legal counsel in the bankruptcy
case.
The firm will provide these services:
(a) assisting and advising the trustee in her evaluation of
whether the case should remain in Chapter 11 or be converted to a
liquidation under Chapter 7;
(b) assisting the trustee in her investigation of the acts,
conduct, assets, liabilities, and financial condition of the Debtor
and of the operation of the Debtor's business;
(c) advising the trustee with respect to her rights, duties, and
powers in the case, including investigating and prosecuting claims
and causes of action;
(d) assisting and advising the trustee in her consultations with
the Debtor and other parties in interest relative to the
administration of the case;
(e) assisting the trustee in analyzing the claims of creditors
and in negotiating with holders of claims;
(f) assisting the trustee in her investigation of the liens and
claims of the Debtor's pre-bankruptcy creditors and the prosecution
of any claims or causes of action revealed by such investigation;
(g) assisting the trustee in connection with asset
dispositions;
(h) assisting the trustee in proposing a plan of reorganization
and preparing disclosure statement and related documents;
(i) assisting and advising the trustee as to her communications
with secured and unsecured creditors;
(j) representing the trustee at hearings and other proceedings;
(k) reviewing and analyzing applications, orders, statements of
operations, and schedules filed with the court;
(l) assisting the trustee in preparing pleadings and
applications as may be necessary in furtherance of the trustee's
interests and objectives;
(m) other legal services.
The firm will be paid at these rates:
Principals $415 to $1,025 per hour
Intellectual Property $225 to $750 per hour
Special Tax Counsel $425 to $1,025 per hour
Associate $285 to $495 per hour
Staff Attorney/Of Counsel $305 to $800 per hour
Paralegal $195 to $390 per hour
Law Clerks & Law Graduates $275 to $375 per hour
In addition, the firm will be reimbursed for out-of-pocket expenses
incurred.
As disclosed in court filings, Miles & Stockbridge is a
"disinterested person" within the meaning of Section 101(14) of the
Bankruptcy Code.
The firm can be reached at:
Patricia B. Jefferson, Esq.
Emily K. Devan, Esq.
Addison J. Chappell
Miles & Stockbridge P.C.
100 Light Street, 10th Floor
Baltimore, MD 21202
Tel: (410) 385-3405
Email: bktrustee@milesstockbridge.com
edevan@milesstockbridge.com
chappell@milesstockbridge.com
About Keyway Apartment Rentals
Keyway Apartment Rentals, LLC is a Maryland limited liability
company that owns a 63-unit residential apartment complex situated
upon three parcels of real property known as 113 Kinship Road, 122
Kinship Road, and 123 Willow Spring Road in Dundalk, Baltimore
County, Md.
Keyway sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. D. Md. Case No. 22-13389) on June 21, 2022. In the
petition signed by its managing member, George Divel, III, the
Debtor disclosed $6,653,350 in assets and $4,252,151 in
liabilities.
Judge Michelle M. Harner oversees the case.
Joseph M. Selba, Esq., at Tydings and Rosenberg, LLP is the
Debtor's legal counsel.
Patricia Jefferson, the Chapter 11 trustee appointed in the
Debtor's case, is represented by Miles & Stockbridge P.C.
KNOW LABS: Extends Convertible Notes Due Dates to January 2023
--------------------------------------------------------------
Know Labs, Inc. approved certain amendments to the senior secured
convertible redeemable notes with Ronald P. Erickson and entities
with which he is affiliated, extending the due dates to Jan. 30,
2023, as disclosed in a Form 8-K filed with the Securities and
Exchange Commission.
About Know Labs
Know Labs, Inc. was incorporated under the laws of the State of
Nevada in 1998. Since 2007, the Company has been focused
primarily
on research and development of proprietary technologies which can
be used to authenticate and diagnose a wide variety of organic and
non-organic substances and materials. The Company's Common Stock
trades on the OTCQB Exchange under the symbol "KNWN."
Know Labs reported a net loss of $25.36 million for the year ended
Sept. 30, 2021, a net loss of $13.56 million for the year ended
Sept. 30, 2020, and a net loss of $7.61 million for the year ended
Dec. 31, 2019. As of June 30, 2022, the Company had $9.63 million
in total assets, $4.61 million in total current liabilities,
$97,261 in total non-current liabilities, and $4.92 million in
total stockholders' equity.
KNOW LABS: Extends Struve Convertible Notes Due Date to Sept. 2023
------------------------------------------------------------------
Know Labs, Inc. approved on Dec. 7, 2022, certain amendments to the
senior secured convertible redeemable notes with Clayton Struve,
extending the due dates to Sept. 30, 2023.
Extension of Warrant Agreement
Also on December 7, the Company approved the Extension of Warrant
Agreement with Clayton Struve, extending the exercise dates as
follows:
Amended
No. Warrant Expiration
Issue Date Shares Date
08-14-2017 1,440,000 08-13-2025
12-12-2017 1,200,000 12-11-2025
08-04-2016 1,785,715 08-04-2025
02-28-2018 1,344,000 02-28-2025
About Know Labs
Know Labs, Inc. was incorporated under the laws of the State of
Nevada in 1998. Since 2007, the Company has been focused primarily
on research and development of proprietary technologies which can
be used to authenticate and diagnose a wide variety of organic and
non-organic substances and materials. The Company's Common Stock
trades on the OTCQB Exchange under the symbol "KNWN."
Know Labs reported a net loss of $25.36 million for the year ended
Sept. 30, 2021, a net loss of $13.56 million for the year ended
Sept. 30, 2020, and a net loss of $7.61 million for the year ended
Dec. 31, 2019. As of June 30, 2022, the Company had $9.63 million
in total assets, $4.61 million in total current liabilities,
$97,261 in total non-current liabilities, and $4.92 million in
total stockholders' equity.
KOSMOS ENERGY: Moody's Cuts CFR to B3 & Alters Outlook to Negative
------------------------------------------------------------------
Moody's Investors Service downgraded Kosmos Energy Ltd.'s Corporate
Family Rating to B3 from B2, Probability of Default Rating to B3-PD
from B2-PD, and senior unsecured notes to Caa1 from B3. The
Speculative Grade Liquidity Rating was upgraded to SGL-2 from SGL-3
reflecting good liquidity. The rating outlook was revised to
negative from rating under review. This concludes Moody's review of
Kosmos Energy's ratings that was initiated on October 11, 2022.
Downgrades:
Issuer: Kosmos Energy Ltd.
Corporate Family Rating, Downgraded to B3 from B2
Probability of Default Rating, Downgraded to B3-PD from B2-PD
Senior Unsecured Regular Bond/Debenture, Downgraded to Caa1 (LGD5)
from B3 (LGD5)
Upgrades:
Issuer: Kosmos Energy Ltd.
Speculative Grade Liquidity Rating, Upgraded to SGL-2 from SGL-3
Outlook Actions:
Issuer: Kosmos Energy Ltd.
Outlook, Changed To Negative From Rating Under Review
RATINGS RATIONALE
The downgrade of Kosmos Energy's ratings reflects increased credit
risks involving the country of Ghana, where the majority of the
company's production resides. On November 29, 2022, Moody's
downgraded the Government of Ghana's long-term issuer rating to Ca
from Caa2, and concurrently lowered Ghana's local currency (LC) and
foreign currency (FC) country ceilings to Caa1 and Caa2,
respectively.
The negative outlook considers risks of potential adverse policy,
regulatory or fiscal measures that could be imposed by Ghana while
the government executes its debt restructuring plan in the coming
months.
Kosmos Energy's B3 CFR remains one notch above Ghana's Caa1 local
currency ceiling reflecting the company's substantial non-Ghana
assets and cash flow, good liquidity, and declining debt position.
While Ghana's high sovereign credit risk limits Kosmos Energy's
ratings given the company derives roughly 55% of its production
from the Jubilee and TEN fields, the country-level concentration in
Ghana will diminish considerably in late-2023 when LNG production
begins at Tortue Phase 1 in Mauritania and Senegal. The company is
also looking to grow its Gulf of Mexico production. Moody's expects
the company to direct all near term free cash flow towards debt
reduction.
The B3 CFR is separated by two notches from the Caa2 foreign
currency ceiling of Ghana reflecting low transfer and
convertibility risk. Kosmos Energy is incorporated in the US,
receives its oil revenues in US dollars, which is kept offshore and
completely outside of the Ghanaian banking system, and does not
have debt or debt service obligations in Ghana's local currency
(Cedi). Therefore, the Ghana government has very little ability to
impose transfer restrictions related to cross-border payments and
foreign currency conversion. Additionally, the company's petroleum
agreement with Ghana has a multifaceted system of contract
stabilization, including choice of law and customary stabilization
protections used in the international petroleum industry.
Kosmos Energy's senior unsecured notes are rated Caa1, one notch
below the B3 CFR, given their unsecured claim to the company's
assets, and their structurally subordinated position to the secured
term loan facility and the secured RBL facility.
The ESG Credit Impact Score is CIS-2 (neutral-to-low), revised from
CIS-3, since ESG considerations are no longer the major constraint
for the rating, while the rating remains constrained by the country
ceiling.
The SGL-2 rating reflects the company's improved free cash flow
profile and good liquidity. Moody's expects the company to generate
over $300 million of free cash flow after covering its maintenance
and growth capex in 2023. The company had $232 million of cash and
$800 million in combined borrowing capacity under its $250 million
corporate revolver and $1.25 billion RBL facility at September 30,
2022. The company does not have any near term debt maturity.
Kosmos Energy's fundamental business, including production
operations and cash flow, are expected to remain solid through
2023. The company generated over $300 million of free cash flow in
the first nine months of 2022 and reduced absolute debt by a
similar amount lowering the net debt/EBITDA ratio to 1.5x at
September 30, 2022. The company also has been able to hedge at
higher prices and improve its overall financial flexibility to
support growth spending through 2023.
Kosmos Energy's B3 CFR incorporates its majority production in
offshore Ghana and related credit risks there, improving financial
leverage, substantial ongoing capital spending requirements
involving the phased Tortue LNG development project, significant
debt amortization obligations starting in 2025, and somewhat
complex corporate and capital structure. The rating also considers
the risks of the company's non-operating interest in key assets,
deepwater focus and the attendant physical and operational risks.
The credit profile is supported by Kosmos Energy's high-quality and
oil-focused producing assets that have low break-even costs and
relatively low base decline rates, geographic diversification
across several West African countries and the US Gulf of Mexico,
strong growth prospects involving the large natural gas and LNG
assets in Mauritania and Senegal, a solid track record of organic
and acquisition-driven growth and a visible pipeline of low-risk
development projects. Absent any adverse effects on its Ghana
operations, Moody's expects financial leverage to decline and free
cash flow to increase through 2023 as the company benefits from
increased volumes, higher oil and gas prices and the completion of
Tortue Phase 1 in the second half of 2023.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The CFR could be upgraded if Kosmos Energy can materially reduce
its exposure to Ghana while generating sufficient production and
cash flow elsewhere to support its debt service and reinvestment
needs. The rating could also be upgraded if Ghana's ratings,
including its local currency country ceiling, were to be upgraded.
Any unexpected action by the Government of Ghana that severely
impairs asset value in Ghana or materially constrains Kosmos
Energy's liquidity, could trigger a ratings downgrade. Although
Moody's expects Kosmos Energy's operational and financial
performance to remain stable through 2023, the CFR could come under
pressure if the company produces large negative free cash flow, the
RCF/debt ratio declines below 15%, or capital spending increases
materially.
Kosmos Energy Ltd. is a Dallas, Texas based publicly traded
exploration and production company with assets in offshore West
Africa and the US Gulf of Mexico.
The principal methodology used in these ratings was Independent
Exploration and Production published in August 2021.
LABORATORIO ACROPOLIS: Unsecureds to Split $45K over 55 Months
--------------------------------------------------------------
Laboratorio Acropolis, Inc., filed with the U.S. Bankruptcy Court
for the District of Puerto Rico a Plan of Reorganization dated
December 6, 2022.
The Debtor is a corporation organized pursuant to the Laws of the
Commonwealth of Puerto Rico which was incorporated on January 15,
2004. It was incorporated to purchase a going concern under the
name of "Laboratorio Acropolis" located on the same premises that
operated a clinical laboratory services.
The immediate reason that triggered the filing of this petition was
the aggressive collection action of Internal Revenue Service. The
Debtor's first Bankruptcy case was filed on June 9, 2016. Due to
Hurricane Maria, September 2017, the Debtor was closed for several
months, and it continued working on part time basis up to February
2018. It had to file a second Bankruptcy Petition.
Class 1 consists of the Internal Revenue Service ("IRS") Claim. IRS
filed Claim Number 3 secured in the amount of $36,573.42. It
encumbers all property of the Bankruptcy Estate. Debtor will pay in
full this secured claim plus 4% interest in 48 equal monthly
installments of $825.78 each beginning November 15, 2022.
Class 2 shall consist of general unsecured creditors. General
Unsecured Creditors were listed by Debtor and/or filed proof of
claims total the amount of $231,609. Creditors in this class shall
receive pro rata a total repayment of $45,000 plus 4% interest in
55 equal monthly installments of $897.00 each. These payment will
commence on February 15, 2023. This Class is impaired.
Equity holders have no voting rights, nor do they receive
distribution under the Plan.
Upon confirmation of the Plan, the Debtor shall have sufficient
funds to continue making all payments then due under this Plan. The
funds will be obtained from the continuation of the business
operations and accounts receivable.
A full-text copy of the Plan of Reorganization dated December 6,
2022, is available at https://bit.ly/3uLnFcd from PacerMonitor.com
at no charge.
About Laboratorio Acropolis
Laboratorio Acropolis, Inc., was incorporated in 2004 to purchase
as a going concern a business named "Laboratorio Acropolis," a
provider of clinical laboratory services.
Laboratorio Acropolis previously filed a Chapter 11 petition
(Bankr. D.P.R. Case No. 16-04609) on June 9, 2016.
Laboratorio Acropolis sought protection under Chapter 11 of the
Bankruptcy Code (Bankr. D.P.R. Case No. 19-02601) on May 8, 2019.
At the time of the filing, the Debtor had estimated assets of less
than $500,000 and liabilities of between $1 million and $10
million. Judge Mildred Caban Flores presides over the case.
Attorney for Debtor:
Gloria Justiniano Irizarry, Esq.
Law Office of Gloria Justiniano Irizarry
Calle A. Ramirez Silva, Suite 8
Mayaguez, PR 00680-4714
Tel: (787) 831-3577
Email: justiniano@gmail.com
LV FORTUNE: Taps Valuation Source as Real Estate Appraiser
----------------------------------------------------------
LV Fortune, LLC seeks approval from the U.S. Bankruptcy Court for
the District of Nevada to employ Valuation Source as real estate
appraiser and valuation expert.
The firm's services include:
(i) providing a self-contained appraisal of the market value of
the Debtor's hotel in Las Vegas; and
(ii) providing expert testimony regarding the appraisals and the
value of the property in conjunction with the Debtor's Chapter 11
case and the confirmation of its plan of reorganization, if
necessary.
The firm will be paid a flat fee of $9,000 for its services.
Andrew Johnson, a partner at Valuation Source, disclosed in a court
filing that his firm is a "disinterested person" as the term is
defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Andrew Johnson
Valuation Source
5510 S. Fort Apache Rd.
Las Vegas, NV 89148
Tel: (702) 496-9923
Website: https://www.valuationsourcenv.com
About LV Fortune, LLC
LV Fortune LLC operates the Fortune Hotel & Suites in Las Vegas,
Nevada.
LV Fortune filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code on Oct. 3, 2022. In the petition
filed by its manager, Jeffrey Fleming, the Debtor reported between
$10 million and $50 million in both assets and liabilities.
Judge Mike K. Nakagawa oversees the case.
The Debtor is represented by Matthew C. Zirzow, Esq., at Larson &
Zirzow, LLC.
M1 DEVELOPMENT: Says Stormfield Not a Creditor of Debtor
--------------------------------------------------------
Debtor M1 Development LLC responded to Stormfield Capital Funding I
LLC's objection to the Debtor's Disclosure Statement dated October
15, 2022.
M1 Development points out that at the outset, it must be made clear
that Stormfield is not a creditor of the Debtor. In fact,
Stormfield acknowledges that fact in footnote 1 of the Objection.
As such, Stormfield does not have standing to object to the
Debtor's Disclosure Statement.
M1 Development further points out that the Disclosure Statement
contains sufficient information for creditors (again not
Stormfield) to decide to vote on the Plan. For example, the Debtor
disclosed its intentions to, among other things, file the M Rental
Brooklyn LLC ("M Rental") Chapter 11 Petition and transfer its 99%
interest of M Rental to Realya Crown Heights LLC ("Realya") in
exchange for a release of the debt owed to Realya, which happens to
be the Debtor's largest creditor. If the plan is confirmed and
Realya's claim is released, the Debtor's only other creditors are
the following: (i) The Department of Treasury - Internal Revenue
Services for $400.00; and (ii) the Board of Managers of the Dupont
Villa Condominium for $26,339.00, and the Plan calls for a 100%
distribution to those two creditors. Since the remaining creditors
will receive 100% of their allowed claim, both creditors are not
eligible to even vote on the Plan.
M1 Development asserts that Stormfield's allegations that "the
Debtor fails to explain how the Debtor here is permitted to seize
the Property from M Rental (and its bankruptcy estate)" is
baseless. As it was more fully set forth in the Disclosure
Statement, the Debtor intends to transfer its ownership of M Rental
to Stormfield subject to all recorded liens and encumbrances
against M Rental and for those claims to be administered in that
bankruptcy case. In short, the Debtor is transferring its ownership
interest to Realya to satisfy its creditors, and then upon
completion of the construction and sale of M Rental's property, M
Rental will satisfy its creditors.
According to M1 Development, Stormfield filed its Objection based
on alleged misrepresentation that the Debtor did not disclose the
updates of the M Rental foreclosure action styled as Stormfield
Capital Funding I, LLC against M Rental Brooklyn LLC, et. at.,
pending before the New York State Supreme Court, Kings County,
index number 524166/2020 (the "Foreclosure"). However, Stormfield,
in preparation of this Objection, failed to take into consideration
one significant fact. The Disclosure Statement was filed prior to
any order being entered in the Foreclosure.
M1 Development points out that the Debtor maintains that the events
that took place in the Foreclosure since the filing of the
Disclosure Statement do not affect its intentions to transfer its
ownership of M Rental and implement its Plan.
Attorneys for the Debtor:
Avrum J. Rosen, Esq.
Nico G. Pizzo, Esq.
LAW OFFICES OF AVRUM J. ROSEN, PLLC
38 New Street
Huntington, NY 11743
Tel: (631) 423-8527
About M1 Development
M1 Development, LLC, filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D.N.Y. Case No.
21-40977) on April 14, 2021. Rafi Manor, owner of M1 Development,
signed the petition. At the time of the filing, the Debtor
disclosed $357,186 in assets and $2,272,000 in liabilities.
Judge Jil Mazer-Marino presides over the case.
The Law Offices of Avrum J. Rosen, PLLC, serves as the Debtor's
legal counsel.
MARYLAND ECONOMIC: Moody's Affirms Ba1 Rating on $14.03MM Bonds
---------------------------------------------------------------
Moody's Investors Service has revised the rating outlook to stable
from negative on the Maryland Economic Development Corporation's
(MEDCO) Student Housing Refunding Revenue Bonds (University of
Maryland, Baltimore County Project) Series 2016. At this time,
Moody's has also affirmed the Ba1 rating on the student housing
project's $14,030,000 of outstanding bonds.
RATINGS RATIONALE
The change in outlook to stable from negative reflects the recovery
of project occupancy to pre-covid levels with fall occupancy of
close to 100% and moderate rental rate increases. The project's
successful lease-up resulted in a Moody's adjusted debt service
coverage of 1.28x in fiscal year 2022 (1.00x including the
repayment of deferred university expenses). In fiscal year 2022,
the project replenished its capital and furnishings fund, which was
drawn down significantly during covid, and repaid in full the
$440,540 of university expenses, which were deferred the previous
fiscal year to support the project following pandemic-related lease
cancellations. Though project rental revenue has recovered, the
project still faces pressure from inflation and elevated renewal
and replacement needs, which could drive coverage down.
RATING OUTLOOK
The outlook is stable. The ongoing strength in occupancy in the
near term will support the project's ability to meet expenses,
including debt service, while funding elevated levels of renewal
and replacement in an inflationary environment.
FACTORS THAT COULD LEAD TO AN UPGRADE OF THE RATING
Sustained strong financial performance as measured by
consistently high debt service coverage levels that incorporate
sufficient deposits to the capital and furnishings fund to meet the
project's renewal and replacement needs.
FACTORS THAT COULD LEAD TO A DOWNGRADE OF THE RATING
A sharp or sustained decline in occupancy levels that lead to
a weakened financial position.
Prolonged increases in expense growth and/or deterioration in
revenue that leads to draws on available reserves.
LEGAL SECURITY
The bonds are special limited obligations payable solely from the
revenues of the project and other funds held with the Trustee and
do not constitute obligations for the Issuer or the University.
PROFILE
Established in 1984, the Maryland Economic Development Corporation
enables the State of Maryland to develop property for economic
purposes which serve the public interest. The purpose of the
Corporation is to assist in the expansion, modernization, and
retention of existing Maryland business, and to attract new
business to the State. MEDCO's Student Housing Refunding Revenue
Bonds (UMBC Project) Series 2016 refunded bonds that financed a
578-bed student housing project on the campus of UMBC called the
Walker Avenue Apartments.
METHODOLOGY
The principal methodology used in this rating was Global Housing
Projects published in June 2017.
MDWERKS INC: Issues 90 Million Common Shares to Tradition Reserve I
-------------------------------------------------------------------
MDwerks, Inc. said in a Form 8-K filed with the Securities and
Exchange Commission that on Dec. 6, 2022, it issued 90,000,000
shares of the Company's common stock upon conversion of 900,000
shares of the Company's Series A Convertible Preferred Stock held
by Tradition Reserve I LLC. Prior to the conversion, Tradition
owned a total of 10,000,000 shares of Series A Preferred Stock,
representing 100% of the authorized and issued Series A Preferred
Stock.
Following the conversion, Tradition distributed the 90,000,000
shares of Common Stock, pro rata, to its members.
Following the conversion, the Company has 108,010,208 shares of
Common Stock outstanding and 9,100,000 shares of Series A Preferred
Stock outstanding.
Under the Company's amended and restated certificate of
incorporation, any holder of Series A Preferred Stock has the
right, at any time and from time to time, to convert all or any of
the shares of Series A Preferred Stock held by such holder into
shares of Common Stock on a one to 100 basis.
The issuance of the shares of Common Stock pursuant to the
foregoing transactions was made without registration in reliance on
the exemption from registration under the Securities Act of 1933,
as amended, afforded by Section 3(a)(9) thereof. No commission or
other remuneration was paid or given directly or indirectly for
soliciting the exchange of such securities.
About MDWerks
MDwerks, Inc. is a public shell company seeking to create value for
its shareholders by merging with another entity with experienced
management and opportunities for growth in return for shares of its
common stock. No potential merger candidate has been identified at
this time. The Company does not propose to restrict its search for
a business opportunity to any particular industry or geographical
area and may, therefore, engage in essentially any business in any
industry. The Company has unrestricted discretion in seeking and
participating in a business opportunity, subject to the
availability of such opportunities, economic conditions, and other
factors.
MDwerks reported net income of $37,976 for the year ended Dec. 31,
2021, compared to a net loss of $20,553 for the year ended Dec. 31,
2020. As of June 30, 2022, the Company had zero asset, $239,444 in
total liabilities, and a total stockholders' deficit of $239,444.
As of Sept. 30, 2022, the Company had zero assets, $49,652 in total
liabilities, and a total stockholders' deficit of $49,652.
Diamond Bar, Calif.-based TAAD LLP, the Company's auditor since
2020, issued a "going concern" qualification in its report dated
April 15, 2022, citing that the Company has suffered recurring
losses from operations that raises substantial doubt about its
ability to continue as a going concern.
MOBIQUITY TECHNOLOGIES: Posts $2.3-Mil. Net Loss in Third Quarter
-----------------------------------------------------------------
Mobiquity Technologies, Inc. has filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q disclosing a
net loss of $2.28 million on $904,223 of revenues for the three
months ended Sept. 30, 2022, compared to a net loss of $3.47
million on $572,745 of revenues for the three months ended Sept.
30, 2021.
For the nine months ended Sept. 30, 2022, the Company reported a
net loss of $5.79 million on $3.37 million of revenues compared to
a net loss of $7.70 million on $1.80 million of revenues for the
same period during the prior year.
As of Sept. 30, 2022, the Company had $4.02 million in total
assets, $1.83 million in total liabilities, and $2.20 million in
total stockholders' equity.
According to Mobiquity, "The Company has incurred significant
losses since its inception in 1998 and has not demonstrated an
ability to generate sufficient revenues from the sales of its
products and services to achieve profitable operations. There can
be no assurance that profitable operations will ever be achieved,
or if achieved, could be sustained on a continuing basis. In
making this assessment we performed a comprehensive analysis of our
current circumstances including: our financial position, our cash
flows and cash usage forecasts for the nine months ended September
30, 2022, and our current capital structure including equity-based
instruments and our obligations and debts.
"Without sufficient revenues from operations, if the Company does
not obtain additional capital, the Company will be required to
reduce the scope of its business development activities or cease
operations. The Company may explore obtaining additional capital
financing and the Company is closely monitoring its cash balances,
cash needs, and expense levels.
"These factors create substantial doubt about the Company's ability
to continue as a going concern within the twelve-month period
subsequent to the date that these condensed consolidated financial
statements are issued."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1084267/000168316822008319/mobiquity_i10q-093022.htm
About Mobiquity
Headquartered in Shoreham, NY, Mobiquity Technologies, Inc. is a
next-generation marketing and advertising technology and data
intelligence company which operates through its proprietary
software platforms in the programmatic advertising space. The
Company's product solutions are comprised of two proprietary
software platforms: its advertising technology operating system (or
ATOS) platform; and its data intelligence platform.
Mobiquity reported a net comprehensive loss of $34.95 million for
the year ended Dec. 31, 2021, a net comprehensive loss of $15.03
million for the year ended Dec. 31, 2020, and a net comprehensive
loss of $44.03 million for the year ended Dec. 31, 2019. As of
June 30, 2022, the Company had $5.11 million in total assets, $1.91
million in total liabilities, and $3.20 million in total
stockholders' equity.
Lakewood, Co-based BF Borgers CPA PC, the Company's auditor since
2018, issued a "going concern" qualification in its report dated
March 29, 2022, citing that the Company has suffered recurring
losses from operations and has a significant accumulated deficit.
In addition, the Company continues to experience negative cash
flows from operations. These factors raise substantial doubt about
the Company's ability to continue as a going concern.
MONTANA TUNNELS: Dormant Mine Owner Seeks Chapter 11
----------------------------------------------------
Montana Tunnels Mining Inc. filed for chapter 11 protection in the
Middle District of Florida. The Debtor elected on its voluntary
petition to proceed under Subchapter V of chapter 11 of the
Bankruptcy Code.
According to court filings, Montana Tunnels Mining estimates
between $50 million and $100 million in debt owed to 1 to 49
creditors. The petition states that funds will not be available to
unsecured creditors.
The Ravalli Republic reports that the filing was reminiscent for
many observers of mining company bankruptcies in Montana in years
past and the prospect of taxpayers getting stuck with reclamation
costs. According to the report, the bankruptcy filing in the U.S.
Bankruptcy Court District of Montana again heightens concerns about
whether Montana Tunnels will pay for the reclamation at its dormant
open-pit mine near Jefferson City in Jefferson County.
"This was, unfortunately, completely predictable, and really
appalling," said Derf Johnson, deputy director of the Montana
Environmental Information Center.
Bonnie Gestring, Northwest Program Director for Earthworks, offered
a similar observation.
"Unfortunately, we're not surprised by these developments," she
said. "We've been worried about the deteriorating conditions at
Montana Tunnels and the ongoing harm to Clancy Creek for some
time."
Patrick Imeson, CEO of Montana Tunnels, said Wednesday that the
company plans to reorganize, eventually start mining again and have
funds for reclamation.
Mr. Imeson had told The Montana Standard in July 2021 that he had a
commitment from a bonding company and was engaged with a major
investment bank to raise $145 million to expand the mine. He did
not disclose the name of the bonding company or bank.
Pegasus once ran the Montana Tunnels mine. Apollo Gold, an entity
that emerged from the Pegasus bankruptcy, took ownership in 2002
and Denver-based Montana Tunnels fully acquired the mine in 2009.
Since then, all that Montana Tunnels has mined at the site is
debt.
Moira Davin, a spokeswoman for DEQ, provided a statement Wednesday
from the agency.
"Since the 1970s, the state has made improvements in
bond calculations so that mines are adequately bonded and can
be reclaimed," she said. "The Montana Tunnels site is one of only
a few mines in the state that remain under-bonded. DEQ has been
working with the mine and entered into an Administrative Order on
Consent in 2022 and since that time has collected an additional
$1.5 million towards the bond."
About Montana Tunnels Mining
Montana Tunnels Mining Inc. filed a petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. D. Mon. Case No.
22-20132) on Dec. 5, 2022. In the petition filed by Patrick
Imeson, as CEO, the Debtor reported assets between $10 million and
$50 million and liabilities between $50 million and $100 million.
The Debtor is represented by:
James A. Patten, Esq.
Brett R. Cahoon
PATTEN PETERMAN BEKKEDAHL
P.O. BOX 176
JEFFERSON CITY, MT 59638-0176
MUSCLE MAKER: Discusses Specifics of AGGIA Agreement
----------------------------------------------------
Muscle Maker, Inc. posted a shareholder update recording and
corresponding transcript, reviewing the recently announced
agreement with AGGIA, including frequently asked questions and key
highlights of the agreement, such as:
* Diversification of the Company
* Potential financial impact on the Company
* Pay for performance structure based strictly on AGGIA
generating net income for Sadot
* AGGIA earns shares, based on net income generated, at a
premium per share price of $1.5625
* AGGIA can earn up to 14,424,275 shares of common stock
equating to generating $22,537,929 of net income
* AGGIA rights to nominate new board members based on net income
thresholds
* Muscle Maker continues to focus on current strategy of growth
through franchising
* Certain provisions of the Agreement requires shareholder
approval
Michael Roper, Muscle Maker's CEO, commented "we announced the
AGGIA agreement on November 18th. Based on questions received, we
felt it best to put together a more comprehensive review for our
shareholders. We have provided both a pre-recorded message and
transcript which are posted on our website for everyone to
access."
Roper continued, "this is a unique opportunity for Muscle Maker.
We get to partner with industry experts in international commodity,
merchandising and shipping who have been successful in the past
building significant agricultural businesses. The agreement is
based on a pay-for-performance structure. AGGIA only earns shares
of common stock based on our new subsidiary, Sadot LLC, generating
net income. Shares earned are calculated at a premium of $1.5625
per share. We were attracted to this structure as it is performance
driven, providing for compensation only if net income is
generated."
Roper continued, "another unique component about this opportunity
is while we build the more diversified company, the current Muscle
Maker team will be able to remain focused on the franchising and
growth strategy and continue to grow the Pokemoto franchise
business model. Nothing changes regarding our current growth
strategy focused on expanding the Pokemoto brand."
To access the pre-recorded message or transcript, visit:
https://musclemakergrill.com/investor-relations/events-presentations/
About Muscle Maker
Headquartered in League City, Texas, Muscle Maker, Inc. is the
parent company of "healthier for you" brands delivering food
options to consumers through traditional and non-traditional
locations such as military bases, universities, ghost kitchens,
delivery and direct to consumer ready-made meal prep options.
Brands include Muscle Maker Grill restaurants, Pokemoto Hawaiian
Poke, SuperFit Foods meal prep and multiple ghost kitchen brands
such as Meal Plan AF, Wrap it up Wraps, Bowls Deep, Burger Joe's,
MMG Smoothies, Mr. Tea's House of Boba, Gourmet Sandwich Co and
Salad Vibes.
Muscle Maker reported a net loss of $8.18 million for the year
ended Dec. 31, 2021, a net loss of $10.10 million for the year
ended Dec. 31, 2020, and a net loss of $28.39 million for the year
ended Dec. 31, 2019. As of Sept. 30, 2022, the Company had $25.38
million in total assets, $6.45 million in total liabilities, and
$18.93 million in total stockholders' equity.
MYLIFE.COM INC: Rancourt Action is Stayed as to Jeffrey Tinsley
---------------------------------------------------------------
Bankruptcy Judge Ernest M. Robles of the Central District of
California grants MyLife.com Inc.'s motion to stay litigation as to
non-debtor defendant Jeffrey Tinsley.
Jeffrey Tinsley is the Debtor's CEO and Chairman -- he holds 56.2%
interest in the Debtor. The Debtor operates a website that allows
subscribers to run background checks on individuals.
The Rancourt Action -- On Dec. 14, 2020, David Rancourt filed a
complaint against the Debtor and Tinsley in a Florida state court.
The Rancourt Complaint alleges that the Debtor's website contains
false and defamatory statements about Rancourt, and asserts claims
for negligence, libel, and defamation against the Debtor and
Tinsley. On March 16, 2021, upon the motion of the Debtor and
Tinsley and over the opposition of Rancourt, the Florida District
Court entered an order referring Rancourt's claims to mandatory
arbitration. Trial in the arbitration is set for March 2023.
The FTC Judgment -- In 2017, the Federal Trade Commission began
investigating the Debtor's business dealings. On Oct. 19, 2021, the
District Court for the Central District of California entered a
partial summary judgment in favor of the FTC. The California
District Court also entered a stipulated Consent Order against the
Debtor and Tinsley on Dec. 15, 2021. The Consent Order imposes a
judgment of approximately $29 million against the Debtor, a
judgment of approximately $5 million against Tinsley, and
injunctive relief against the Debtor and Tinsley.
The Rancourt Action has been stayed as to the Debtor but has not
been stayed as to Tinsley. Now, the Debtor moves for an order
extending the scope of the automatic stay in the Rancourt Action to
Tinsley. The Debtor argues that an extension of the stay is
necessary because (1) a judgment against Tinsley in the arbitration
would effectively constitute a judgment against the Debtor, since
Rancourt asserts the same claims against both Tinsley and the
Debtor; (2) the Debtor will be distracted from its reorganization
efforts if Tinsley is required to devote substantial time and
effort to defending against the Rancourt Action; and (3) a judgment
against Tinsley in the Rancourt Action could trigger Tinsley's
indemnification rights against the Debtor, which would give rise to
an additional claim against the estate.
Rancourt did not file an opposition to the Motion. The FTC takes no
position with respect to the Debtor's request to extend the
automatic stay to Tinsley in the Rancourt Action. The FTC maintains
that the FTC Judgment is excepted from the automatic stay pursuant
to section 362(b)(4), and argues that any order extending the scope
of the automatic stay must be narrowly tailored to the Rancourt
Action so that such an order does not interfere with the FTC's
efforts to enforce the FTC Judgment.
The Court finds that the bankruptcy filing was precipitated by the
Debtor's failure to make timely payments of the amounts owed under
the Consent Order, not by operational problems with the Debtor's
business. Given that the Debtor continues to operate a business
that has generated meaningful revenue and even a small profit
during the first two months of the case, the Court finds that the
Debtor has made a sufficient showing of a likelihood of a
successful reorganization to warrant the issuance of a section 105
injunction to stay the Rancourt Action as to Tinsley.
Absent issuance of a section 105 injunction, Tinsley would be
required to spend significant time attending depositions and
pretrial hearings and responding to discovery in the arbitration of
the Rancourt Action. As the Debtor's Chairman and CEO, it is
critical that Tinsley not be distracted from focusing upon the
Debtor's reorganization, particularly at this early stage of the
case. Thus, the Court finds and concludes that if the arbitration
of the Rancourt Action is not stayed, the demands upon Tinsley's
time will prevent him from sufficiently focusing upon the
reorganization, resulting in irreparable harm to the Debtor.
In addition, the Court finds that the balance of the equities
weighs in favor of the Debtor, in view of its finding that the
Debtor will likely suffer irreparable harm absent the issuance of
an injunction. Likewise, the Debtor's ability to reorganize would
likely be impaired if the Court did not issue a section 105
injunction -- issuance of such an injunction is in the public
interest.
Accordingly, the Court will issue a section 105 injunction staying
the Rancourt Action as to Tinsley. Unless otherwise ordered by the
Court, the injunction will remain in effect until the Debtor
obtains confirmation of a Chapter 11 Plan. Moreover, the injunction
will not apply to any attempts by the United States to enforce the
FTC Judgment against either the Debtor or Tinsley.
A full-text copy of the Memorandum of Decision dated Nov. 30, 2022,
is available at https://tinyurl.com/2cufpvm6 from Leagle.com.
About Mylife.com Inc.
Mylife.com Inc. is an American information brokerage firm founded
by Jeffrey Tinsley in 2002 as Reunion.com.
On Sept. 2, 2022, Mylife.com Inc., doing business as Reunion.com
Inc., filed for Chapter 11 protection (C.D. Calif. Case No.
22-14858), with between $500,000 and $1 million in assets and
between $10 million and $50 million in liabilities. Jeffrey
Tinsley, chief executive officer of Mylife.com, signed the
petition.
Judge Ernest M. Robles oversees the case.
The Debtor is represented by Leslie Cohen Law PC.
NO RUST REBAR: Appellants' Designation of Contents is Striken
-------------------------------------------------------------
Bankruptcy Judge Peter D. Russin of the Southern District of
Florida grants the Motion to Strike 285 Appellant Designation filed
by the Trustee, Sonya Salkin Slott.
The dispute concerns an appeal stemming from the Court's order
granting Trustee's Motion to Compromise Controversy with Green Tech
Development. After considering the Settlement Motion and the
related Objection filed by Don Smith (the Debtor's principal),
Global Energy Sciences, LLC, Raw Energy Materials, Corp. and Yellow
Turtle Design, LLC, the Court found that the Settlement complied
with Rule 9019 and entered an order granting the Motion to
Compromise Controversy. The Objecting Parties then filed a Notice
of Appeal on Sept. 6, 2022, and an Appellant Designation of
Contents for Inclusion in Record on Appeal on Sept. 20, 2022.
The Trustee now moves to strike the following designated items: "
Lead Case (Case No. 21-12188-PDR) Document Title Document Number
Notice of Taking Rule 2004 Examination Duces 224 Tecum of Sonya
Salkin Slott, Chapter 7 Trustee and under BR 7030 (filed by Debtor)
Notice of Taking Rule 2004 Examination Duces Tecum 225 of Green
Tech Development LLC and BR 7030 (filed by Debtor) Amended Notice
of Taking Rule 2004 Examination 230 Duces Tecum of Sonya Salkin
Slott and 7030 (filed by Debtor) Motion to Strike Notice of
Examination (filed by Green 239 Tech) Notice of Taking Rule 2004
Examination Duces Tecum 243 of Green Tech Development LLC Joinder
(filed by Creditors Global Energy Sciences, LLC, Don Smith,
Interested Party Elina Jenkins) Notice of Filing Transcript of
2004/7030 Examination 247 of Sonya Salkin Slott (filed by Debtor)
Order Granting Motion to Strike Re: # 239 249 Adversary Proceeding
(Case No. 21-01111-PDR) Document Title Document Number 96 Notice of
Filing Affidavits of Lauren and Ludwig 97 Affidavit of Don Smith
Certification with Exhibits"
The Trustee argues that the Record on Appeal should be limited to
only those items referenced in Defendant's written Objection and
those items upon which the Objection relies. In contrast, the
Objecting Parties argue that the record should include any item
they wish to designate.
The Court notes that the items to which the Trustee objects, were
(i) not presented to the Court for consideration, (ii) not
mentioned in the Objection, and (iii) not mentioned during the
hearing. On these points alone, the Court finds that these items
should be stricken from the Designation unless an exception
applies. Before addressing the potential exceptions however, the
Court notes that even if these items were presented for
consideration, it would have been improper for the Court to
consider them where the only basis for their inclusion is the
extent to which they may go to the merits of the underlying
disputes which were sought to be settled.
The Court also notes that certain of the items are even less
substantive than documents that may go to the merits of the settled
dispute because they are merely docket entries of notices for rule
2004 examination, and worse, the notices were not filed by the
Objecting Parties, but by the Debtor after the Court had already
determined the Debtor lacked standing.
Furthermore, the Court can see no basis by which the Appellant will
be unduly prejudiced by the striking of these items from the
Designation considering that these items were not relied upon by
the Court, were not raised by any party for consideration, were not
referenced in any way in reaching the ultimate decision on the
Trustee's Settlement Motion, and would be inappropriate or
irrelevant to the issue of approving or denying the Settlement even
had they been properly raised.
A full-text copy of the Order dated Nov. 30, 2022, is available at
https://tinyurl.com/yrhywwy3 from Leagle.com.
About No Rust Rebar
No Rust Rebar is a Pompano Beach, Fla.-based company that
manufactures and sells composite reinforcement for concrete.
No Rust Rebar filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No, 21-12188) on
March 5, 2021. Don Smoth, president, sigendthe petition. At the
time of the filing, the Debtor disclosed $1,763,496 in assets and
$4,378,630 in liabilities. Judge Peter D. Russin oversees the
case. Kevin Christopher Gleason, Esq., at Florida Bankruptcy
Group, LLC, serves as the Debtor's legal counsel.
NO RUST REBAR: Green Tech OK'd to Snub Rule 2004 Discovery
----------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida
grants the motion to quash subpoena and for protective order filed
by Green Tech Development, LLC.
In January 2015, Don Smith founded the Debtor No Rust Rebar, Inc.
The Debtor contracted to purchase industrial real estate in Pompano
Beach, Florida, but after placing a nonrefundable deposit, did not
have the funds necessary to close on the Property. In an attempt to
salvage the deal, the Debtor agreed to assign its right to purchase
the Property to Green Tech Development, LLC. In January 2016, Green
Tech bought the Property and the Debtor remained in possession.
Litigation between the parties ensued with respect to the Debtor's
assertion that it had an oral option to purchase the property from
Green Tech. Years later, on March 5, 2021, the Debtor filed a
voluntary Chapter 11 bankruptcy petition, and removed the State
Court Litigation to this Court. Green Tech also filed a proof of
claim.
In May 2022, the bankruptcy case was converted to Chapter 7, and
subsequently, the Trustee sought approval by the Court of a
settlement with Green Tech which would resolve all issues between
them. Over the objection of the Smith Parties, the Court approved
the Trustee's Settlement Motion. The Smith Parties filed an appeal
of the Court's order approving the Settlement but did not seek a
stay pending the appeal.
The Smith Parties' Subpoena Duces Tecum -- Non-debtors Don Smith,
Global Energy Sciences, LLC, Raw Energy Materials Corp, and Yellow
Turtle Design LLC filed a Notice of Taking Rule 2004 Examination
Duces Tecum of Green Tech Development, LLC. Green Tech is a
creditor of the bankruptcy estate of the Debtor No Rust Rebar, Inc.
The Smith Parties seek information and documents regarding the
probate estate of Joan Saperstein -- a third party and former
principal of Green Tech not otherwise associated with the Debtor or
the bankruptcy estate.
The Smith Parties' Notice states that the examination relates to
matters affecting the administration of Debtor's estate "because
there is presented for discovery the issue of who should control
(and be authorized to make decisions on behalf of) Green Tech,
because, (i) after the death of the late Joan Saperstein, Green
Tech had no remaining membership interests and two equal economic
interests (one held by Don Smith and one held by Joan Saperstein's
Estate, which may, or may not, properly be held now by Marshall
Ives), and (ii) in such circumstances, the governing statutes
contemplate the possible appointment of a receiver to control Green
Tech."
Green Tech argues that the discovery sought is not permissible
under Rule 2004 because it is not relevant to the administration of
the estate since all contested matters involving Green Tech that
are relevant to the administration of the estate have been
resolved. The adversary proceedings involving Green Tech and any
other matter pending in the main bankruptcy case were resolved
under the Settlement. Thus, Green Tech argues, "there are no
matters in controversy involving Green Tech to be administered by
the Trustee for the benefit of the bankruptcy estate."
Green Tech also objects to the discovery on grounds that the notice
is harassing and burdensome, because it "is a reminder of the
trauma and harassment endured by the grieving family of Joan
Saperstein and is clearly a fishing expedition to pursue the
Insiders' individual, self-serving search for the next alternative
theory of recovery to pursue" in the ongoing Saperstein Probate
case.
At the November 3 hearing, the Smith Parties argued that the
discovery sought is related to the administration of the estate
because it would shine light on the issue of Green Tech's corporate
governance which could then affect the validity of Green Tech's
participation in the Settlement. Essentially, the Smith Parties
would potentially seek to unwind the Settlement that they are now
appealing, by arguing Green Tech lacked authority to enter into
it.
The Court disagrees with the Smith Parties. The discovery sought is
inapposite to a potential collateral attack on the Settlement. Even
if the Smith Parties were to uncover from the requested discovery
useful information regarding the corporate governance issue, that
would only lead to a state court action, not even marginally
involving the Debtor or the bankruptcy estate, to determine the
corporate governance issue including the rightful interest holders
of Green Tech. The Court would not have subject matter jurisdiction
over an internal corporate governance dispute of a non-debtor.
The Court finds and concludes that the Smith Parties are merely at
the stage of 2004 discovery of Green Tech, hoping to uncover
evidence to support their potential dispute with Green Tech (in
which the Debtor would not be a party), the result of which may or
may not lead to a potential effort to assert Green Tech lacked
authority to enter into the Settlement. The discovery simply has no
connection to the administration of the estate and fails to meet
even the broad standard of Rule 2004.
Additionally, the 2004 discovery would arguably provide Don Smith
individually, or the Smith Parties collectively, an unfair
strategic advantage in the Saperstein Probate case which the
parties acknowledged involved the very corporate governance issue
for which the Smith parties now seek such discovery.
Moreover, the Court finds that the Smith Parties failed to make any
showing or argument that good cause exists to allow the discovery,
either because it is needed to establish a claim or that denial of
it would cause undue hardship or injustice. The Court further finds
that the discovery is clearly not being sought to establish a claim
against Green Tech for the benefit of the estate -- the only
potential destination for the discovery is a state court action by
the Smith Parties for their own benefit in contesting Green Tech's
governance. In fact, no arguments were made that any of the
discovery sought would uncover any information on Debtor's affairs.
Likewise, the Court reasons that the Smith Parties would not suffer
a hardship or be prejudiced by denial of the discovery because they
are and for years have been able to pursue such discovery in the
state court. The Court maintains that the Smith Parties can
arguably pursue their discovery in the Saperstein Probate case to
the extent that the rules of that forum allow since what they seek
to discover here seems to be at the core of Don Smith's litigation
there. The Court holds that Smith Parties, or Don Smith
individually, should not be allowed to circumvent the discovery
rules of the state court by seeking information in this bankruptcy
case apparently related to the Saperstein Probate case through the
otherwise broad scope of Rule 2004.
A full-text copy of the Order dated Nov. 30, 2022, is available at
https://tinyurl.com/54x9mp9d from Leagle.com.
About No Rust Rebar
No Rust Rebar is a Pompano Beach, Fla.-based company that
manufactures and sells composite reinforcement for concrete.
No Rust Rebar filed its voluntary petition for relief under Chapter
11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No, 21-12188) on
March 5, 2021. Don Smoth, president, sigendthe petition. At the
time of the filing, the Debtor disclosed $1,763,496 in assets and
$4,378,630 in liabilities. Judge Peter D. Russin oversees the
case. Kevin Christopher Gleason, Esq., at Florida Bankruptcy
Group, LLC, serves as the Debtor's legal counsel.
NORTH AMERICAN: Case Summary & 12 Unsecured Creditors
-----------------------------------------------------
Debtor: North American Acceptance Financial, LLC
1207 North Causeway Blvd.
Metairie, LA 70001
Chapter 11 Petition Date: December 12, 2022
Court: United States Bankruptcy Court
Eastern District of Louisiana
Case No.: 22-11537
Judge: Hon. Meredith S. Grabill
Debtor's Counsel: Robin R. De Leo, Esq.
THE DE LEO LAW FIRM, LLC
800 Ramon St
Mandeville, LA 70448
Tel: (975) 727-1664
Fax: (985) 727-4388
Email: Lisa@northshoreattorney.com
Total Assets: $6,018,753
Total Liabilities: $2,560,638
The petition was signed by Larry Verges as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 12 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/FL45DMY/North_American_Acceptance_Financial__laebke-22-11537__0001.0.pdf?mcid=tGE4TAMA
ORIGIN AGRITECH: Appoints Dr. Shaojiang Chen as Director
--------------------------------------------------------
Dr. Shaojiang Chen, 58, joined the Board of Directors of Origin
Agritech Limited as an independent board member, effective Nov. 1,
2022.
As disclosed in a Form 8-K filed with the Securities and Exchange
Commission, Dr. Chen is currently a professor at the China
Agricultural University, Agronomy College, where he has been
teaching since 2000. During 2017 to 2022, Dr. Chen also served as
the director at the Maize Breeding Engineering Center of the MOE,
and has served as the vice director at the National Maize
Improvement Center of China. Dr. Chen is widely published on many
topics relating to fertilization and corn plant genetics. He also
worked on a Sino-German Program at the University of Hohenheim,
Germany from 2003 to 2013.
Dr. Chen has a BA from Henan Agricultural University in Agronomy, a
MSc in Crop Genetics and Breeding from Henan Agricultural
University, and a PhD in Crop Genetics and Breeding, from Northeast
Agricultural University.
Resignation of Mr. Rong Chen
Mr. Rong Chen resigned, as of March 31, 2022, as an independent
director of the Company to pursue other business and personal
endeavors.
About Origin Agritech
Headquartered in Beijing, China, Origin Agritech Limited, along
with its subsidiaries, is focused on agricultural biotechnology and
an agricultural oriented e-commerce platform, operating in the PRC.
The Company's seed research and development activities specialize
in crop seed breeding and genetic improvement. The e-commerce
activities will focus on delivering agricultural products to
farmers in China via online and mobile ordering and tracking the
source of the agricultural products via blockchain technologies.
Origin Agritech reported a net loss of RMB127.08 million for the
year ended Sept. 30, 2021, compared to a net loss of RMB102.84
million for the year ended Sept. 30, 2020. As of March 31, 2022,
the Company had RMB93.86 million in total assets, RMB280.01 million
in total liabilities, and a total deficit of RMB186.15 million.
Lakewood, Colorado-based B F Borgers CPA PC, the Company's auditor
since 2020, issued a "going concern" qualification in its report
dated Feb. 4, 2022, citing that the Company incurred recurring
losses from operations, has net current liabilities and an
accumulated deficit that raise substantial doubt about its ability
to continue as a going concern.
PBF HOLDING: Fitch Affirms LongTerm IDR at 'BB-', Outlook Stable
----------------------------------------------------------------
Fitch Ratings has affirmed PBF Holding Company LLC's (PBF Holding)
Long-Term Issuer Default Rating at 'BB-'. Fitch also affirmed PBF
Holding's revolving credit facility at 'BB+'/'RR1' and affirmed the
senior unsecured notes at 'BB-'/'RR4'. The Rating Outlook is
Stable.
The rating reflects improved refining sector conditions, relatively
low debt levels, strong liquidity, geographic diversification, and
the expectation of positive FCF generation over the rating horizon.
This is offset by the impact of increased regulatory obligations,
potential secular changes, including the impact of renewables, and
relatively higher cost structure to its peers. The acquisition by
PBF Energy Inc. of the 52.1% of shares of PBF Logistics not already
owned has no impact on the PBF Holding ratings.
The Stable Outlook reflects the expectation that refining
conditions will remain positive in the near-term, continued debt
reduction efforts, and positive FCF generation.
KEY RATING DRIVERS
Materially Improved Capital Structure: PBF Holding repaid its $1.25
billion 9.25% first lien secured notes of its debt with cash during
2022. The transaction results in a permanent reduction in debt,
frees up secured debt capacity, and greatly enhances the prospects
of refinancing the 2025 senior unsecured notes. PBF Holding has
also used cash on hand to fully repay the $900 million outstanding
on its ABL revolver, and the $100 million outstanding on its PBF
Logistics revolver.
The company has made approximately $30 million of open market
repurchases on its 2025 and 2028 senior unsecured during 2022. The
expected result of approximately $2.28 billion in debt reduction,
improved liquidity, maturity extension, interest savings, and
increase in secured borrowing capacity is a material improvement in
the capital structure.
Currently Strong Refining Margins: PBF Holding is benefiting from
historically strong refining margins due to the impact of the
Russian-Ukraine war, increasing demand from the strengthening
economy, declining product imports, and below normal product
inventory levels. Fitch does not believe high refining margins are
sustainable over time, but near-term margins are likely to remain
elevated. Refining remains one of the most cyclical corporate
sectors, with sharp swings in crack spreads over the cycle,
although the impact of the coronavirus was deeper and longer than
most previous downturns.
In addition to cyclical challenges, the sector is also facing
secular challenges with the growth of electric vehicles and
increasing environmental regulations that would reduce the demand
for hydrocarbons.
Higher Cost Refineries: PBF Holding has taken steps to lower the
cost structure of their refineries; however, Fitch considers their
cost structure to be higher than other refining peers. Fitch
believes this was a significant reason the company underperformed
its peers and incurred relatively larger FCF deficits during the
2020-2021 industry downturn. In addition, PBF Holding's East Coast
refinery is exposed to European imports, although this is not an
issue at this time.
The company did take steps during the pandemic to reduce costs,
including closing one of its East Coast refineries. Higher natural
gas prices have led to higher operating expenses, as the company is
exposed to a $75 million-$95 million impact on a $1/million British
thermal unit (MMbtu) change in natural gas prices. This has been
more than offset by the increase in higher crack spreads.
Uncertain Impact of Regulatory Obligations: Fitch believes the
renewable identification numbers (RINs) and California "cap and
trade" obligations as manageable in the near term. The U.S. EPA
finalized the 2021 and 2022 Renewable Fuel Standard renewable
volume obligations (RVOs) and reduced the existing RVO for 2020 on
June 3, 2022. Historically, refiners have been able to pass along
RIN prices, but it becomes more challenging when prices move
sharply higher, particularly when combined with reduced demand.
Most of California's 'cap and trade' obligations are passed on to
the buyer.
Chalmette Refinery Renewable Project: PBF Holding is investing in
renewable diesel project at its Chalmette refinery with an
anticipated start up in the first half of 2023. The company is
having discussions with potential financial and strategic partners
to help finance the 20,000 barrels per day production facility. The
renewable project would generate RINs, which would reduce the
dependence of buying RINs in the open market.
Relationship with PBF Energy Inc.: PBF Holding is an indirect
subsidiary of PBF Energy Inc., a holding company with primary
subsidiaries of PBF Holding and PBFX. PBF Holding typically
distributes cash to PBF Energy to fund tax payments and dividends.
PBFX also sends its share of distributions to PBF Energy, which can
be used to cover a portion of the tax payments and distributions.
The parent has no debt.
DERIVATION SUMMARY
PBF Holding throughput capacity is 973 mbbl/d, which compares with
Delek U.S. Holdings (Delek; BB-/Stable) of 302 mbbl/d and CVR
Energy, Inc. (CVR; BB-/Stable) of 207 mbble/d. The Nelson
Complexity Ration, which measure the ability of a refinery to
produce lighter and more heavily refined and valuable products from
a barrel of oil, is 13.2, which compares to 10.8 for CVR and
8.7-10.5 for Delek. All three companies have adequate liquidity,
although Delek's leverage ratio is elevated due to recent
acquisitions.
CVR and Delek have lower operating costs than PBF Holding. CVR is
insulated by being a niche operator in the Mid-Continent but is not
diversified. Delek has diversification through non-refining
sectors, but is smaller in scale. PBF Holding is exposed to
regulatory pressure on RIN prices, although both Delek and CVR have
exposure to changing regulations on the exemption of small market
refineries to renewable regulations.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer:
- West Texas Intermediate (WTI) oil price of $95 in 2022, $81 in
2023, $62 in 2024, and $50 over the long term;
- Gross refining margins at $13.56/bbl in 2022 (YTD actual plus 4Q
at $8.15/bbl), $6.69/bbl in 2023 and declining to five-year average
levels;
- Throughput declining averaging slightly over 900,000 barrels per
day (mbpd) throughout the forecast period;
- Capex to approximate $600 million throughout the forecasted
period after $885 million in 2022;
- Assume $100MM in annual dividends after recently reinstated
$.20/share quarterly dividend at the parent;
- No share buybacks or acquisitions modelled although the
significant FCF generation would likely lead to that.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Materially improved cost structure that mitigates FCF deficits
during refinery margin downturns;
- Material reduction in RIN exposure;
- Diversification through scale or non-refining businesses (i.e.,
retail, chemicals, etc.);
- Through-the-cycle gross debt/EBITDA below 2.0x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Material reduction in liquidity, including reduced bank
commitments or reduction in cash;
- Regulatory changes that increase costs, including RINs and other
federal and state regulations;
- Inability to adequately access debt capital markets;
- Through-the-cycle gross debt/EBITDA above 2.5x.
LIQUIDITY AND DEBT STRUCTURE
Sufficient Near-Term Liquidity: PBF Holding had cash on hand of
$1,851 million and availability under its revolver of in excess of
$2.6 billion with no borrowings on its revolver as of September
30,2022. The company amended the revolver on May 25, 2022. The
amendment provides for a Tranche A group that did not elect to
extend the maturity in an amount of $1.55 billion. A Tranche B
facility matures in Jan. 31, 2025 in the amount of $2.75 billion.
An accordion feature allows for an additional $500 million on the
Tranche B facility plus an amount equal to the Tranche A
commitments that decide to extend. The revolver borrowing base is
derived from a formula based on cash on hand, accounts receivable
and inventory and can fluctuate materially due to changes in
commodity prices, receivable payments, inventory supplies, and cash
on hand.
RIN and inventory adjustments can have material impacts on working
capital uses over the near term. RINs obligations for 2021 and 2022
will likely be paid in 2023, which would have a one-time effect on
working capital. Sharp changes in oil prices could also impact
working capital uses. Fitch believes liquidity is sufficient to
meet RIN obligations during the forecasted period, although a spike
in RIN prices combined with an inability to pass-through RIN costs
during an industry downturn could result in materially weaker
liquidity levels.
ISSUER PROFILE
PBF Energy Inc. is a holding company comprised of PBF Holding
Company LLC (PBF Holding), a large independent refiner and supplier
of unbranded transportation fuels, heating oil, petrochemical
feedstocks, lubricants and other petroleum products in the United
States and PBF Logistics, which is a provider of petroleum and
refined product logistics services primarily to PBF Holdings.
As of Dec. 31, 2021, PBF Holding owns and operates six domestic oil
refineries and related assets with a combined throughput capacity
of 973,000 barrels per day. PBF Holding's refineries are
geographically diversified with two refineries in PADD 1, one each
in PADD 2 and three, and two refineries in PADD 5. The company has
focused on purchasing complex refineries that allow it to process
harsh crude slates (heavy, sour) and still produce a high yield of
high-value, clean products.
PBF Logistics assets include pipelines, unloading rail terminals,
truck terminals, products and liquefied petroleum gas loading and
storage facilities. PBFX does not take ownership of the crude and
products it handles and does not engage in trading of commodities.
The assets and operations of PBFX are closely integrated with the
refineries of its affiliate, PBF Holding and its operations are
supported by long term, fee-based contracts with minimum volume
commitments from PBF Holding.
On Nov. 30, 2022, PBF Energy Inc. purchased the 52.1% of PBF
Logistics that it didn't already own with a combination of PBF
Energy Inc. shares and approximately $304 million of cash. PBF
Logistics will remain as a separate wholly-owned subsidiary of PBF
Energy Inc.
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
----------- ------ -------- -----
PBF Holding
Company LLC LT IDR BB- Affirmed BB-
senior
unsecured LT BB- Affirmed RR4 BB-
senior secured LT BB+ Affirmed RR1 BB+
PBF LOGISTICS: Fitch Affirms LongTerm IDR at 'BB-', Outlook Stable
------------------------------------------------------------------
Fitch Ratings has affirmed PBF Logistics LP's (PBFX) Long-Term
Issuer Default Rating (IDR) at 'BB-' and senior unsecured notes at
'BB-'/ 'RR4'. Fitch has also affirmed the senior secured revolver
at 'BB+'/'RR1'. The senior unsecured notes are co-issued by PBF
Logistics Finance Corporation. The Rating Outlook is Stable.
On Nov. 30th, 2022 PBFX and its ultimate parent PBF Energy Inc.
(PBF Energy, not rated) completed its previously announced merger,
whereby PBF Energy now indirectly owns and controls PBFX. The
ratings reflect its strong strategic and operational ties with PBF
Holding Company LLC (PBF Holding; BB-/Stable) PBFX's affiliate and
primary counterparty. The ratings also reflect the partnership's
modest size, low leverage and stable cash-flows supported by
fee-based and fixed-priced contracts that limit commodity price
exposure and provide some volume protection in the form of minimum
volume commitments.
The Stable Outlook reflects Fitch's expectation that refining
conditions will remain positive in the near term, the company's
continued debt reduction efforts and positive FCF.
KEY RATING DRIVERS
PBF Energy Acquisition of PBFX: On Nov. 30, 2022 PBFX and its
ultimate parent PBF Energy Inc. announced the completion of the
previously announced merger. PBF Energy acquired the remaining
~52.3% of PBFX limited partner interests held by public unitholders
and now indirectly owns 100% and has full control of PBFX.
Counterparty Concentration Risk: PBFX derives approximately 85% of
its revenues from its affiliate, PBF Holding. PBF Holding is
expected to remain the partnership's largest customer over Fitch's
rating horizon. PBFX provides PBF Holding with critical logistics
assets that support its refining operations on a long-term, fixed
fee basis with significant minimum volume commitments. As its
primary counterparty, PBFX is subject to the operational, business
and financial risks of PBF Holding, whereby throughput volumes at
PBFX's facilities could be significantly reduced, adversely
impacting cash flows and distributions; the equalization of IDR's
reflects this.
In the absence of expansion of the asset portfolio to service more
third-party customers, volume growth continues to be dependent on
PBF Holding, and could limit future growth of the partnership.
Upcoming Maturities: With its deleveraging strategy, PBFX has
continued to enhance financial flexibility, but is faced with the
issue of addressing its near-term debt maturities. PBFX has both
the $500 million revolving credit facility maturing July 2023 and
the $525 million notes due in May 2023. Fitch expects the
partnership will address the senior notes ahead of the upcoming
maturity date. Management continues to evaluate the capital
structure that best fits the partnership in terms of amount and
tenor for the revolver and notes.
Corporate Family Relations: PBFX is operationally and strategically
integral to PBF Holding as PBFX provides critical infrastructure
support. PBF Holding is the fourth largest independent refiner in
the U.S. and its parent, PBF Energy Company LLC holds 100% of the
general partners and 100% of limited partner interests in PBFX.
Midstream growth has been a key component of PBF's strategy. As
such, PBF Energy has historically supported growth at PBFX with
drop down transactions, completing five drop-down transactions
since inception. Given that PBF Energy provides critical
infrastructure to support overall company growth, Fitch believes
that PBFX will continue to benefit from PBF Energy's support.
Modest Size and Scale: The partnership is geographically
diversified, with presence in four Petroleum Administration for
Defense Districts' (PADD), although most of the assets and
operations are concentrated on the East Coast. Fitch believes this
operational concentration and the partnership's EBITDA of
approximately $200 million makes PBFX vulnerable to weak East Coast
margins should there be an outsized event or slowdown in the
region's refining market.
Cash Flow Assurance: PBFX's operations demonstrate stable cash
flows underpinned by long-term, take-or-pay contracts with PBF
Holding, with an approximate four-year weighted average contract
life. PBFX provides services at fixed fee (including inflation
escalators and certain increases in operating costs) with minimum
volume commitments (MVC), limiting PBFX's commodity price
sensitivity and providing some volumetric downside protection. Cash
flow assurance, currently around 90% of revenues will remain high
in the near term, but the payments from MVCs will step down over
time.
Parent Subsidiary Linkage: Post the completed acquisition, Fitch
sees a parent subsidiary relationship between PBF Energy and PBFX.
Fitch believes PBF Energy has a stronger standalone credit profile
(SCP) than PBFX, and follows the strong parent path to determine
PBFX's ratings. Legal incentive is considered weak as there are no
guarantees or cross-default provisions. Strategic and operational
incentives are considered high as PBF Energy now has full ownership
and control over PBFX, which is operationally integral to PBF
Energy's core business, providing critical midstream logistics
infrastructure. Determining parent credit quality could be a factor
in limiting PBFX's rating, although it is not a limiting factor
now.
PBF Holding Relationship: PBFX and PBF Holding are affiliate
entities within the PBF Energy family. PBF Energy Inc is the parent
company with its primary subsidiaries being PBF Holding and PBFX.
While there are significant operational and strategic ties between
the PBF Holding and PBFX entities, the organizational structure was
set up so that both are separate legal entities, file separate
financial statements, and the company's debt is non-recourse to the
other.
DERIVATION SUMMARY
PBFX's leverage is strong for its rating category. Fitch expects
PBFX's leverage between 2.6x-2.8x for YE 2022. PBFX's ratings
reflect its strong strategic and operating ties to PBF Holding. The
heavy dependence on PBF Holding could present an outsized event
risk should there be an operating, production or financial issue at
PBF Holding. The partnership is geographically well diversified
with assets in four PADD's, but approximately 46%-50% of EBITDA is
generated from assets in the East Coast (Delaware and Paulsboro,
NJ).
PBFX is rated below Holly Energy Partners L.P (HEP; BB+/Stable).
Like PBFX, HEP's rating is supported by stable cash flows that are
largely minimum volume commitments from its investment grade
sponsor and largest counterparty, HF Sinclair ('BBB-'/Stable).
Fitch expects HEP's leverage to be under 4.0x in 2023. With
adjusted EBITDA roughly half of HEP, scale and the significant
exposure to PBF Holding are limiting factors to PBFX's ratings.
Relative to a 'BB-' rated issuer like Delek Logistics Partners, LP
(DKL; BB-/ Stable), PBFX is geographically more diversified and has
better leverage. Fitch expects DKL's leverage to be elevated at YE
2022 but reduce to around 4.0x YE 2023, trending lower in outer
years. Like PBFX, DKL has significant counterparty exposure to its
parent and sponsor, Delek US Holdings, Inc (Delek Holdings;
BB-/Stable). While leverage metrics at PBFX is expected to be
better than DKL, PBFX's rating is constrained by its primary
counterparty, PBF Holding. Relative to a 'BB-' rated peer like
NuStar (NS; BB-/ Stable), PBFX has better leverage, but
significantly smaller scale of operations. NuStar does not have
customer concentration like PBFX.
KEY ASSUMPTIONS
- Fitch price deck for West Texas intermediate oil price of $95/bbl
in 2022, $81/bbl in 2023, $62/bbl in 2024 and $50/bbl thereafter;
- Revenues and EBITDA decline in 2022 as MVC's are reduced for some
rail assets;
- Capex spending in 2022 in line with management estimate;
- Distributions held at current levels through 2023;
- Notes due 2023 is refinanced and revolving credit facility is
extended/refinanced;
- No asset sale or equity issuance assumed.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Favorable rating action at PBF Holding will lead to positive
rating action for PBFX, provided the factors driving a rating
change at PBF Holding have benefits that accrue to the credit
profile of PBFX;
- Expected leverage (total debt with equity credit/ operating
EBITDA) at PBFX is at or below 3.0x on a sustained basis, provided
the rating of PBF Holding is no longer a constraint on PBFX's
rating;
- Should PBFX demonstrate a move towards further insulation from
its reliance on PBF Holding, such that third-party revenues
contribute at least 30% of total revenues with credit metrics
remaining within sensitivities, Fitch may consider a separation
between its IDRs and PBF Holding's.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Lack of progress towards addressing the secured revolver before
it becomes current and unsecured notes due 2023 proactively and/or
impairments to liquidity;
- Negative rating action at PBF Holding will negatively impact
PBFX's rating;
- Expected leverage (total debt with equity credit/operating
EBITDA) above 4.0X and/or Distribution Coverage below 1.0x on a
sustained basis;
- Material change to contractual arrangement or operating practices
with PBF Holding that negatively impacts PBFX's cash flow or
earnings profile;
- Increases in capital spending beyond Fitch's expectation that
have negative consequences for the credit profile (e.g. if not
funded with a balance of debt and equity).
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: Adequate Liquidity: As of Sept. 30, 2022, PBFX
had approximately $541.4 million of available liquidity. Cash on
the balance sheet was $44.9 million, in addition to the $496.5
million available under the $500 million senior secured revolver.
The revolver includes a $75 million sub-limit for standby letters
of credit and a $25 million sub-limit for swing-line loans. PBFX
had letters of credit of $3.5 million outstanding under the
revolver. The partnership's liquidity in the near term is
considered adequate.
ISSUER PROFILE
PBFX is a master limited partnership (MLP) that owns, leases,
operates and develops crude oil and refined petroleum products
terminals, pipelines, storage facilities, and other logistics
assets that primarily support PBF Holding's refineries in the
Northeast, Midwest, Gulf Coast, and West Coast of the U.S.
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
----------- ------ -------- -----
PBF Logistics LP LT IDR BB- Affirmed BB-
senior secured LT BB+ Affirmed RR1 BB+
senior unsecured LT BB- Affirmed RR4 BB-
PBF Logistics
Finance Corporation
senior unsecured LT BB- Affirmed RR4 BB-
PETROLIA ENERGY: Swings to $1.9 Million Net Income in 2021
----------------------------------------------------------
Petrolia Energy Corporation has filed with the Securities and
Exchange Commission its Annual Report on Form 10-K disclosing
net income of $1.93 million on $5.89 million of total revenue for
the year ended Dec. 31, 2021, compared to a net loss of $10.31
million on $2.89 million of total revenue for the year ended Dec.
31, 2020.
As of Dec. 31, 2021, the Company had $7.84 million in total assets,
$8.90 million in total liabilities, and a total stockholders'
deficit of $1.06 million.
Houston, Texas-based M&K CPAS, PLLC, the Company's auditor since
2019, issued a "going concern" qualification in its report dated
Dec. 9, 2022, citing that the company has an accumulated deficit at
Dec. 31, 2021 and 2020 and has a working capital deficit at Dec.
31, 2021, which raises substantial doubt about its ability to
continue as a going concern.
Petrolia stated, "During the year ended December 31, 2021, the
Company operated at a negative cash flow from operations of
approximately $9,000 per month and our auditors have raised a going
concern in their audit report as contained herein. Management also
plans to minimize general and administrative expenses and optimize
cashflow from the Utikuma asset.
"We plan to generate profits by reducing general and administrative
expenses and optimizing Utikuma cashflow. However, we may need to
raise additional funds to workover wells through the sale of our
securities, through loans from third parties or from third parties
willing to pay our share of drilling and completing the wells. We
do not have any commitments or arrangements from any person to
provide us with any additional capital.
"If additional financing is not available when needed, we may need
to cease operations. There can be no assurance that we will be
successful in raising the capital needed to recomplete oil or gas
wells nor that any such additional financing will be available to
us on acceptable terms or at all."
A full-text copy of the Form 10-K is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1368637/000149315222035022/form10-k.htm
About Petrolia
Petrolia Energy Corporation is engaged in the exploration and
development of oil and gas properties. Since 2015, the Company
has
established a strategy to acquire, enhance and redevelop
high-quality, resource in place assets. As of 2018, the Company
has
included strategic acquisitions in western Canada while actively
pursuing the strategy to execute low-cost operational solutions,
and affordable technology.
PHOENIX GUARANTOR: Moody's Affirms B2 CFR, Outlook Remains Stable
-----------------------------------------------------------------
Moody's Investors Service affirmed the ratings of Phoenix Guarantor
Inc. ("PGI") including the B2 Corporate Family Rating, B2-PD
Probability of Default Rating, B1 ratings on the senior secured
first lien bank credit facilities, and Caa1 rating on the senior
secured second lien term loan. The rating outlook is stable.
The rating affirmation reflects Moody's view that PGI's significant
scale and relatively diverse mix of businesses will continue to
help the company grow its earnings. Moody's expects financial
leverage will decline below 6 times in the next 12 to 18 months,
absent any material debt-funded acquisitions.
Affirmations:
Issuer: Phoenix Guarantor Inc.
Corporate Family Rating, Affirmed B2
Probability of Default Rating, Affirmed B2-PD
Senior Secured 1st lien Revolving Credit Facility, Affirmed B1
(LGD3)
Senior Secured 1st Lien Term Loan, Affirmed B1 (LGD3)
Senior Secured Term Loan B1, Affirmed B1 (LGD3)
Senior Secured 2nd Lien Term Loan, Affirmed Caa1 (LGD5) from
(LGD6)
Outlook Actions:
Issuer: Phoenix Guarantor Inc.
Outlook, Remains Stable
RATINGS RATIONALE
PGI's B2 CFR is constrained by high financial leverage and a heavy
reliance on government payors. Moody's estimates PGI's pro forma
adjusted debt/EBITDA for September 30, 2022 approximated 6.3 times,
inclusive of the company's Equus Workforce Solutions ("Equus")
divestiture. Moody's expects debt/EBITDA to improve to the high 5
times range over the next 12 to 18 months, assuming no significant
debt-funded acquisitions. The company's active M&A strategy carries
risk, including IT integration risk, though the company has
demonstrated successful integration of recent acquisitions thus
far. The rating also reflects Moody's view that the company will
continue to be acquisitive, and will use its free cash flow for
acquisitions.
PGI's rating is supported by the company's national footprint and
strong market positions. With over $7 billion in revenue, the
company has significant scale and a relatively diverse mix of
businesses. PGI's rating is also supported by a strong and growing
underlying demand for both home and community-based services for
seniors and people with intellectual and developmental
disabilities.
Moody's expects PGI to maintain good liquidity over the next 12
months. As of September 30, 2022, the company had approximately $14
million of cash on hand. However, pro forma for the Equus
divestiture, cash balances are in excess of $170 million. Moody's
anticipates that PGI will repay its approximately $113 million of
swingline borrowings with proceeds from the divestiture. Further,
Moody's expects the company to generate positive free cash flow of
approximately $70 million in the next 12 months, which includes
mandatory first lien term loan amortization of approximately $30
million. PGI has access to a $320 million revolving credit
facility, which expires in March 2024 and has approximately $207
million of availability as of September 30, 2022 due to borrowings
on the swingline facility. Moody's expects the company will address
the expiration of the revolving credit facility in the next 12
months. Moody's also forecasts the company to have sufficient
cushion under the springing first lien net leverage covenant when
triggered.
PGI's senior secured first lien credit facility, comprised of a
$320 million revolving credit facility expiring in March 2024,
$1.791 billion first lien term loan maturing March 2026, and $1.225
billion first lien term loan maturing March 2026, is rated B1, one
notch above the B2 CFR. This reflects the benefit of a layer of
loss absorption provided by the $450 million senior secured second
lien term loan, which is rated Caa1 and matures in March 2027.
The outlook is stable. Moody's expects PGI to grow its EBITDA such
that financial leverage will decline below 6.0 times in the next 12
to 18 months. Moody's also expects PGI to maintain its good
liquidity.
ESG CONSIDERATIONS
PGI's credit impact score is highly negative (CIS-4), reflecting
its neutral-to-low exposure (E-2) to environmental risk
considerations, highly negative exposure (S-4) to social risks in
providing high quality healthcare services to individuals with
intellectual and developmental disabilities as well as those with
catastrophic injuries. The company relies heavily on government
reimbursement, which exposes it to regulatory and reimbursement
changes. The company is also exposed to labor pressures including
wage inflation given its large workforce of low wage workers.
Exposure to governance considerations is highly negative (G-4),
reflecting aggressive financial policies under majority private
equity ownership, though tempered by a meaningful minority
ownership stake by Walgreens Boots Alliance.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be upgraded if PGI exhibits strong organic growth
in both the pharmacy solutions and provider services businesses.
The ratings could be upgraded if the company demonstrates steady
margin expansion. Quantitatively, ratings could be upgraded if
leverage were sustained below 5.0 times.
PGI's ratings could be downgraded if the company's operating
performance and/or liquidity deteriorates. A shift to more
aggressive financial policies could result in a ratings downgrade.
The ratings could be downgraded if PGI experiences sustained
negative free cash flow. Quantitatively, ratings could be
downgraded if leverage were sustained above 6.0 times for an
extended period.
The principal methodology used in these ratings was Business and
Consumer Services published in November 2021.
Phoenix Guarantor Inc. ("PGI") is the parent company of
BrightSpring Health Services, which merged with PharMerica
Corporation in 2019 to create one of the leading providers of home
and community-based health and pharmacy services. PGI serves
complex client and patient segments with significant lifelong and
chronic health needs, primarily serving seniors in multiple care
settings and people with intellectual/developmental disabilities
(I/DD). Revenues are approximately $7.5 billion for the last twelve
month period ending September 30, 2022. PGI is majority owned by
Kohlberg Kravis and Roberts & Co. (KKR), with minority ownership by
Walgreens Boots Alliance, Inc. and management.
PLASKOLITE PPC II: Moody's Lowers CFR & First Lien Term Loan to B3
------------------------------------------------------------------
Moody's Investors Service has downgraded Plaskolite PPC
Intermediate II LLC's Corporate Family Rating to B3 from B2. At the
same time, Moody's has downgraded Plaskolite's first-lien term loan
and revolving credit facility ratings to B3 from B2, and
Probability of Default rating to B3-PD from B2-PD. The rating
outlook is stable.
Downgrades:
Issuer: Plaskolite PPC Intermediate II LLC
Corporate Family Rating, Downgraded to B3 from B2
Probability of Default Rating, Downgraded to B3-PD from B2-PD
Senior Secured 1st Lien Bank Credit Facility, Downgraded to B3
(LGD3) from B2 (LGD3)
Outlook Actions:
Issuer: Plaskolite PPC Intermediate II LLC
Outlook, Remains Stable
RATINGS RATIONALE
The rating downgrade reflects Plaskolite's earnings weakness and
higher-than-expected debt leverage, primarily driven by reduced
demand in Europe and declining orders from industrial applications.
Although the company has implemented price actions and cost
containment measures, a swift improvement in earnings is unlikely
given the excess inventory, soft demand and elevated labor costs.
Moody's expect its adjusted debt leverage close to 7x for the next
12-18 months, versus the 6.0x threshold for a B2 rating.
Plaskolite's earnings declined in 2021 and 2022 from its 2020 peak
due to cost inflation, supply chain strains and decline in
COVID-related products. The company's debt-funded acquisition of
Plazit Polygal in late 2021 also contributed to the increase in
debt leverage given the weaker-than-expected earnings from its
European operations.
Moody's expect Plaskolite's equity sponsor will direct free cash
flow to reduce debt or fund accretive bolt-on acquisitions, instead
of shareholder distributions. This will help the company meet the
requirements for a B3 rating. Despite a high debt leverage,
Plaskolite has consistently generated free cash flows for the last
four years and will continue to do so thanks to its low capital
intensity, largely hedged interest expense and working capital
release.
Plaskolite's B3 CFR considers its business focus on manufacturing
acrylic sheets and polycarbonate sheets, reliance on two major
suppliers for MMA and PC resins, and relatively concentrated
customer base. Risk factors also include interchangeability and
substitution by other types of thermoplastic plastics and
competition with large backward integrated plastics producers.
The B3 CFR is supported by Plaskolite's leading market position in
thermoplastic products, good profit margins and free cash flow
generation. Its modest product and end market diversity, combined
with operational flexibility demonstrated in the past economic
downturn and a meaningful proportion of contracts with quarterly
raw material adjustment mechanisms continue to support relatively
stable earnings compared to many rated peers in the chemical
industry.
Plaskolite has a good liquidity profile. Plaskolite had a cash
balance of about $41 million and $60 million revolving credit
facility availability as of September 30, 2022. Despite weaker
earnings, Moody's expect the company to generate free cash flow in
the next 12 months. Plaskolite's revolver has a springing
maintenance covenant—first lien net leverage ratio, which is set
at 7.7x and is tested when the outstanding principal amount exceeds
35% ($35 million) of the commitment. The current revolving credit
facility is due December 2023 and Moody's expect the company to
timely refinance or extend the maturity.
The stable outlook reflects the company's free cash flow generation
which will help reduce leverage and support liquidity.
ESG CONSIDERATIONS
Plaskolite's highly negative credit impact score (CIS-4) is mainly
driven by its governance risks including high debt leverage and
debt-funded acquisitions under private equity ownership. The
company is also exposed to regulations on waste and pollution from
the production of acrylic and polycarbonate sheets, as well as the
requirement to lower energy consumption and increase recycling over
time. Social risks are moderately negative, as health and safety
risks exist in the extrusion and casting of acrylic and
polycarbonate sheets.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
Moody's could upgrade the rating, if the company improves its
earnings and free cash flows after a successful integration of the
acquired businesses, and reduces its debt leverage, such that
adjusted debt/EBITDA falls below 6.0x on a sustainable basis.
Moody's could downgrade the rating, if debt leverage exceeds 7.5x
for an extended period or the company fails to generate positive
free cash flow or shows a substantive deterioration in liquidity.
More aggressive financial strategy could also lead to a rating
downgrade.
The principal methodology used in these ratings was Chemicals
published in June 2022.
Plaskolite PPC Intermediate II LLC manufactures transparent
thermoplastic sheets such as acrylic and polycarbonate for
construction, retail, and other industrial end markets. Products
include consumer displays, kitchen and bath, lighting, museum
glass, signs, and windows/ doors. The company operates
manufacturing facilities mainly in the US and has a distribution
center in the Netherlands. Plaskolite is headquartered in Columbus,
Ohio. The company was acquired by PPC Partners from Charlesbank in
December 2018.
PREMIER GRILLING: Seeks Cash Collateral Access
----------------------------------------------
Premier Grilling LLC and Premier Grilling Outdoors LLC ask the U.S.
Bankruptcy Court for the Eastern District of Texas, Sherman
Division, for authority to use cash collateral in accordance with
the budget, with a 10% variance.
The Debtors require the use of cash collateral to continue the
operation of their businesses.
Prior to its chapter 11 filing, Debtor PG operated retail stores in
Frisco, McKinney, and Plano along with a website and other
e-commerce accounts through which PG sells outdoor grilling
products online to customers across the country.
In 2019, the Debtors' current management discovered that a former
comptroller had not been keeping accurate books and records or
paying sales and payroll taxes, creating a liquidity and debt
crisis for the companies. While the companies attempted to overcome
the issues created by the former comptroller by obtaining loans
from various friends and colleagues, they also began using merchant
cash advance agreements to create liquidity for their operations.
The rates, fees, and other charges levied by the MCA companies have
since overwhelmed and offset the liquidity the Debtors intended to
realize, causing a cash shortfall that became unsustainable.
In the weeks leading up to the bankruptcy filing and as part of the
restructuring efforts, Debtor PG closed its Plano and McKinney
stores and will continue operating only its Frisco flagship store
going forward. Debtor PG will reject its store leases in Plano and
McKinney as part of its reorganization.
The Debtor PG's primary secured creditors are Chase Bank, Veritex
Community Bank, the Small Business Administration, and various
MCAs. Chase Bank holds the senior secured lien against all of the
Debtor PG's assets and Veritex Community Bank holds the second lien
position. Certain of the MCAs have filed UCC financing statements
with the Texas Secretary of State, but Debtor PG does not believe
that the MCAs hold liens against any of its assets due to the value
of Debtor PG's assets and the under-secured position of the senior
lien holders.
Likewise, Debtor PGO's secured creditors are comprised of various
MCAs that purportedly purchased Debtor PGO's "future" accounts
receivable. However, PGO's accounts receivable constitute
construction trust funds under Chapter 162 of the Texas Property
Code, and PGO believes that its subcontractor and material provider
creditors are construction trust fund beneficiaries with property
interests in PGO's accounts receivable superior to any interest of
an MCA.
As adequate protection, the Debtors propose to provide the
following adequate protection to secured creditors to the extent of
any diminution in the value of their respective collateral:
a. superpriority claims, pursuant to sections 361(2),
363(c)(2), 364(d)(1), 503(b)(1), 507(a)(2) and 507(b) of the
Bankruptcy Code with such superpriority claims to be senior to all
other postpetition superpriority claims, subject to a carve-out for
professional fees and fees owed to the United States Trustee as
reflected in the budget; and
b. replacement liens on all property now owned or hereafter
acquired by the Debtors, with such liens to be subordinate only to
the liens of any applicable taxing authority, and subject to a
carve-out for professional fees and fees owed to the United States
Trustee in accordance with the budget.
A copy of the motion is available at https://bit.ly/3FYq4qJ from
PacerMonitor.com.
About Premier Grilling LLC
Premier Grilling LLC is a grill store in Texas offering BBQ
smokers, charcoal grills, flat- top grills & griddles, gas grills,
infrared grills, kamado grills, and pellet grills.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Tex. Case No. 22-41727) on December 9,
2022. In the petition signed by Brian Rush as CEO of Premier
Grilling LLC and Dan Ferguson as president of Premier Grilling
Outdoors, the Debtor disclosed up to $10 million in both assets and
liabilities.
Judge Brenda T. Rhoades oversees the case.
Melissa S. Hayward, Esq., at Hayward PLLC, is the Debtor's legal
counsel.
PUERTO RICO: HTA Plan Declared Effective
----------------------------------------
The Financial Oversight and Management Board for Puerto Rico
announced that the Plan of Adjustment for the Puerto Rico Highways
and Transportation Authority (HTA) that reduces HTA's debt by more
than 80% became effective Dec. 6, 2022.
The Plan of Adjustment creates a solid financial foundation to
ensure Puerto Rico's roads and public transportation system are
maintained and improved. HTA will now be able to implement the
transportation sector reforms set forth in the certified HTA and
Commonwealth Fiscal Plans.
"HTA's exit from bankruptcy is essential to build and maintain safe
roads," said the Oversight Board's Chairman David Skeel. "The Plan
of Adjustment together with the comprehensive transportation sector
reform defined in the Fiscal Plan puts Puerto Ricans at the center
of infrastructure development, improvements in safety, and traffic
congestion management."
The annual debt service decreases substantially from $294 million
before the debt restructuring to an affordable $90 million annual
over the term of the bonds, saving Puerto Rico more than $3 billion
in debt service payments. The financial stability of the Plan of
Adjustment allows HTA to invest more
on roads and other projects.
HTA completed the exchange of more than $6.4 billion of existing
bonds and other claims to $1.2 billion of new bonds. In addition,
HTA bondholders received $389 million in cash. The first of two
$24 million cash deposits were made to a reserve for the benefit of
general unsecured creditors.
In October 2022, U.S. District Court for the District of Puerto
Rico entered an order confirming the Plan of Adjustment for the
Puerto Rico Highway and Transportation Authority (HTA) that was
submitted by the Oversight Board on May 2, 2022, and modified on
Sept. 6, 2022.
With confirmation of the HTA Plan, only one government agency on
the island has yet to restructure its debt: Puerto Rico's Electric
Power Authority, which holds some $9 billion in debt, the largest
of any public agency.
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, COFINA, and HTA.
On Jan. 18, 2022, the Title III Court entered its findings of fact
and conclusions of law confirming the Commonwealth's Eighth Amended
Plan. On March 15, 2022, the Plan became effective.
As of the Effective Date, the Commonwealth's Plan reduced total
funded debt obligations from $34.3 billion of prepetition debt to
only $7.4 billion, representing a total debt reduction of 78%.
This debt reduction will also reduce the Commonwealth's maximum
annual debt service (inclusive of COFINA debt service) from $4.2
billion to $1.15 billion, representing a total debt service
reduction of 73%.
QUANERGY SYSTEMS: Case Summary & 20 Largest Unsecured Creditors
---------------------------------------------------------------
Debtor: Quanergy Systems, Inc.
433 Lakeside Drive
Sunnyvale, CA 94085
Business Description: Quanergy designs, develops, and markets
Light Detection and Ranging ("LiDAR")
sensors and 3D perception software solutions
that enable intelligent, real-time
detection, tracking and classification of
objects such as people and vehicles in
mission-critical markets such as security,
smart cities and industrial automation.
Chapter 11 Petition Date: December 13, 2022
Court: United States Bankruptcy Court
District of Delaware
Case No.: 22-11305
Judge: Hon. John T. Dorsey
Debtor's Counsel: Sean M. Beach, Esq.
YOUNG CONAWAY STARGATT & TAYLOR, LLP
Rodney Square
1000 N. King Street
Wilmington, DE 19801
Tel: (302) 571-6600
Email: sbeach@ycst.com
and
COOLEY LLP
Debtor's
Claims,
Noticing &
Solicitation
Agent: BANKRUPTCY MANAGEMENT SOLUTIONS, INC.
(D/B/A STRETTO)
Debtors'
Restructuring
Advisor: SIERRA CONSTELLATION PARTNERS
Debtor's
Financial
Advisor: FTI CONSULTING, INC.
Debtor's
Investment
Banker: RAYMOND JAMES FINANCIAL, INC.
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Larry Perkins as chief restructuring
officer.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/YODLYUI/Quanergy_Systems_Inc__debke-22-11305__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Credit Suisse Professional $7,660,000
Securities (USA) LLC Services
7033 Louis Stephens Dr
Raleigh, NC 27560
Tel: 919-994-2998
2. Global Emerging GEM Facility $2,267,430
Markets Group Fee
9 West 57th Street
49th Floor
New York, NY 10019
Tel: 212-582-3400
Email: mlhom@gemny.com
3. Velodyne LiDAR USA Inc. Legal Settlement $2,250,000
5521 Hellyer Ave
San Jose, CA 95138
Office of the General Counsel
Tel: 669-275-2251
Email: lidar@velodyne.com
4. White & Case LLP Professional $2,083,013
1221 Avenue of Americas Services
New York, NY 10020-1095
Attn: Elena Millerman
Tel: 212-819-8200
Email: elenamaria.millerman@whitecase.com
5. Sanmina Corporation Trade Payable $1,939,655
2700 North First Street
San Jose, CA 95134
Attn: Jure Sola
Tel: 408-964-3500
6. CITIC Capital Acquisition Corp Transaction $1,070,433
Genesis Beijing No.8 Expenses
9/F East Tower Xinyuan South Road
Beijing, 100027 China
Tel: 86 10 5802 3889
7. Sierra Circuits Trade Payable $779,710
1108 West Evelyn Avenue
Sunnyvale, CA 94086
Attn: Ken Bahl
Tel: 408-735-7137
8. Comet Technologies USA Inc. Trade Payable $471,706
5675 Hudson Industrial Parkway
Hudson, OH 44236
Tel: 234-284-7849
Email: yxlon@yxlon.com
9. Triple Crown Consulting Trade Payable $424,653
10814 Jollyville Road
Building Iv, Suite 100
Austin , TX 78759
Attn: David Smith
Tel: 408-680-2589
10. Cadence Design Systems, Inc. Trade Payable $340,000
PO Box 202769
Dallas, TX 75320
Tel: 408-943-1234
11. Fabrinet Trade Payable $263,645
One Nexus Way
Camana Bay, Grand Cayman
Ky-1-9005 Cayman island
Attn: Colin R. Campbell
Tel: 662-524-9600
12. Koito Manufacturing Co., Ltd Customer Orders $250,000
500 Kitawaki, Shimizu-Ku
Shizuoka-Shi, Shizuoka-Ku
424-8764 Japan
Attn: Mr. Yusuke Kasaba
Tel: 81-54-347-5504
13. Rand Technology Trade Payable $231,066
15225 Alton Parkway
Suite 100
Irvine, CA 92618-2351
Attn: Andrea Klein
Tel: 949-255-5700
Email: Info@randtech.com
14. Grant Thornton LLP Professional $231,050
33562 Treasury Center Services
Chicago, IL 60694-3500
Tel: 312-856-0200
15. Bosch Security Systems LLC Customer Orders $200,000
2216 Abbey Rd
Cape Girardeau, MO 63701
Attn: John Wekenborg
Tel: 573-318-0880
Email: security.marketing@us.bosch.com
16. Spanidea Systems LLC Trade Payable $160,200
1525 Mccarthy Blvd 1039
Milpitas, CA 95035
Attn: Bhagirath Choudhary
Tel: 669-226-7863
Email: usa@spanidea.com
17. TRW Customer Orders $150,000
24175 Research Dr
Farmington Hills, MI 48335
Tel: 800-321-0784
18. Advanced Micro Foundry Pte LTD Trade Payable $124,740
11 Science Park Road
Singapore, 117685 Singapore
Tel: 65 6909 0955
19. Infortrend Corporation Trade Payable $106,733
435 Lakeside Drive
Sunnyvale, CA 94085
Tel: 408-988-5088
Email: sales.us@infortrend.com
20. Hella Kgaa Hueck & Co Customer Orders $100,000
W 2 Lippstadt
Beckumer Str. 130
Lippstadt, 59552 Germany
Tel: 0180-6-250002
RADIOLOGY PARTNERS: S&P Alters Outlook to Neg., Affirms 'B-' ICR
----------------------------------------------------------------
S&P Global Ratings revised its outlook on El Segundo, Calif.-based
Radiology Partners Holdings LLC to negative from stable and
affirmed its 'B-' issuer credit rating, reflecting possibility of
an unsustainable capital structure and constrained liquidity if the
impact of the No Surprise Act coupled with rising costs is larger
than our base-case expectations.
S&P said, "At the same time, we are affirming our 'B-' issue-level
rating and '3' recovery rating on company's secured first lien debt
(recovery prospects: 50%-70%; rounded estimate: 55%) and 'CCC'
issue-level rating and '6' recovery rating on the unsecured debt
(recovery prospects: 0%-10%; rounded estimate: 0%).
"Our negative outlook reflects the rising cost pressures on EBITDA
and our expectation that liquidity will be constrained. We expect
rising wage costs because of the tight labor market will pressure
EBITDA margins for 2022 and possibly into 2023. The total cost of
operations for first half 2022 was about 95% of revenue, 2% higher
compared with first half 2021. We project adjusted EBITDA margins
will decline about 150 basis point (bps) in 2022, from 12.9% in
2021. Radiology Partners also faced uncertainty from payers trying
to impose lower reimbursement rates by enforcing a Independent
Resolution Process (IDR) under the No Surprise Act implemented Jan
1, 2022. The company has won 85% of the cases referred under the
IDR process to the arbiter and is 95% in-network (versus 98%
previously), but the process threatens to delay payments. As of
June 30, 2022, company's liquidity position includes $67 million
cash, with $240 million available under $440 million revolver.
Although it is too early to determine the impact of the No Surprise
Act on the company's revenue and costs, we believe it will delay
cash collections, resulting in large working capital outflows.
Should this occur over an extended period, we believe the company's
liquidity may become constrained.'
In addition, the reimbursement rate cuts will also have a potential
impact on the company's EBITDA. Key factors such as rate decreases
on Medicare physician fee schedule (MPFS) and a cut on global
services will affect the total reimbursement cuts. Additionally,
the 2% sequestration, which returned as of June 1, 2022 (1% as of
April 1, 2022), will remain in place. Therefore, there are looming
effects of reimbursement rate cuts that could further tighten its
liquidity position.
Radiology Partners has generated cash flow deficits over the years
while it has focused on increasing scale largely through
acquisitions. The company has grown through debt-financed
acquisitions over the last seven years, as it seeks to enhance its
scale in a fragmented but consolidating industry. However, the
company has been generating cash flow deficits each year and the
pressure on margins from payers and labor market challenges will
lead to further outflows. S&P said, "We expect 11.0x to 11.5 x debt
to EBTIDA in 2022, falling to 11.0x in 2023, largely because of
lower EBITDA. Radiology Partners has been aggressively acquiring
companies over the past several years, thus we expect the company
to remain highly leveraged."
S&P said, "Our negative outlook reflects our view that Radiology
Partners' persistent negative free cash flows, the tight labor
market's impact on margins, and delayed cash collections due to
pressure from payers (under the No Surprise Act) will lead to
tighter liquidity, increasing the potential risk of default.
"We could lower our rating on Radiology Partners within the next 12
months if the impact from the No Surprise Act coupled with
increasing costs, result in continued significant cash outflows,
leading to the belief that the company's highly leveraged capital
structure is unsustainable.
"We could revise the outlook to stable if the company materially
improves its free operating cash flow, or if liquidity becomes less
constrained and/or EBITDA interest coverage ratio improves to above
1.5x."
ESG credit indicators: E-2, S-2, G-3
REPLICEL LIFE: Hires Mao & Ying as New Auditor
----------------------------------------------
Replicel Life Sciences Inc. said in a regulatory filing with the
Securities and Exchange Commission that it has received the consent
of Mao & Ying LLP to act as auditor of the Company. The Company
stated that:
1. BDO issued a resignation letter on its own initiative as
auditors of the Company effective July 15, 2022;
2. the resignation of BDO was not considered or approved by the
audit committee of the Company or the board of directors of the
Company;
3. the appointment of Mao & Ying was approved by the audit
committee and the board of directors of the Company;
4. there was no modified opinion expressed in BDO's report on
any of the Company's financial statements relating to the period
commencing at the beginning of the Company's two most recently
completed financial years and ending on the date of resignation of
BDO; and
5. there have been no "reportable events" within the meaning
assigned under subsection 4.11(1) of NI 51-102.
About Replicel
RepliCel Life Sciences Inc. is a regenerative medicine company
focused on developing cell therapies for aesthetic and orthopedic
conditions affecting what the Company believes is approximately one
in three people in industrialized nations, including
aging/sun-damaged skin, pattern baldness, and chronic tendon
degeneration. These conditions, often associated with aging, are
caused by a deficit of healthy cells required for normal tissue
healing and function. These cell therapy product candidates are
based on RepliCel's innovative technology, utilizing cell
populations isolated from a patient's healthy hair follicles.
Replicel Life reported a net loss and comprehensive loss of C$4.07
million for the year ended Dec. 31, 2021, compared to a net loss
and comprehensive loss of C$1.58 million for the year ended Dec.
31, 2020. As at Dec. 31, 2021, the Company had C$591,794 in total
assets, C$7.43 million in total liabilities, and a total
shareholders' deficiency of C$6.84 million.
Vancouver, British Columbia-based BDO Canada LLP, the Company's
auditor since 2010, issued a "going concern" qualification in its
report dated June 28, 2022, citing that the Company has accumulated
losses of $42,231,642 since its inception and incurred a loss of
$4,073,315 during the year ended Dec. 31, 2021. These events or
conditions, along with other matters, indicate that a material
uncertainty exists that may cast substantial doubt about its
ability to continue as a going concern.
REVERSE MORTGAGE: $124.5M DIP Loans from Leadenhall, TCB OK'd
--------------------------------------------------------------
The U.S. Bankruptcy Court for the District of Delaware entered a
second interim order authorizing Reverse Mortgage Investment Trust
Inc. and its debtor-affiliates to use cash collateral and obtain
post-petition financing in the aggregate amount up to $124.5
million.
The DIP facility is now comprised of:
(a) up to $44.5 million under DIP Notes by and among the
Debtors, Leadenhall Capital Partners LLP and certain of its
affiliates, and BNGL Holdings, L.L.C. as Parent; and
(b) $80 million of DIP Tail Advances under a Tail DIP Facility
among the Debtors and Texas Capital Bank and a consortium of Tail
Advance DIP Lenders.
The DIP Notes consist of $34.5 million drawn under the DIP Notes,
upon entry of the Second Interim Order, and $10 million of
Prepetition Obligations owed to Leadenhall, which will roll up and
convert on a cashless dollar-for-dollar basis into DIP LH Op Notes
under the DIP Facilities upon entry of the Final Order and
satisfaction of the Roll-Up Condition.
The Tail Advance DIP facility incorporates a Participation
Agreement between TCB and Longbridge Financial, LLC.
The Bankruptcy Court previously authorized the Debtors to borrow,
on an interim basis, pursuant to a secured debtor-in-possession new
money facility in an aggregate amount of no less than $13 million
from BNGL. The Initial Interim DIP Order and the rights granted
therein are in full force and effect for the period between entry
of the Initial Interim DIP Order and the entry of the Second
Interim DIP Order. The Second Interim Order amends and restates
the entire Initial Interim DIP Order and governs from and after
entry of the Second Interim Order.
The Debtors have a critical need to obtain post-petition financing
under the DIP Facility and use cash collateral, as applicable, to,
among other things, pay the costs and expenses associated with
administering the Chapter 11 Cases, continue the orderly operation
of the Debtors' business, maximize and preserve the Debtors' going
concern value.
The Debtors are obligated under these Prepetition Secured
Facilities:
Facility Outstanding Balance
-------- -------------------
TCB Warehouse Facility $159,554,366
TCB Tail Facility $89,804,394
TCB Buyout Facility $137,652,839
Existing Note Agreement $192,778,848
Prepetition Parent Repo Facility $12,018,549
Prepetition Parent Demand Loan $52,947,397
The Original DIP Proposal contemplated a financing facility, by and
among (i) RMF; (ii) the DIP Guarantors; (iii) Leadenhall Capital
Partners LLP; (iv) the Existing Leadenhall Lenders; and (v) BNGL
Holdings, that would provide the liquidity to transfer the Ginnie
Mae HECM MSR business to Longbridge, and subsequently conduct an
orderly winddown of the chapter 11 cases following the transition.
However, the terms of the Original DIP Proposal remained subject to
ongoing negotiations and were subject to potential material change.
The terms of the Original DIP Proposal were ultimately not
finalized in advance of the First Day Hearing.
However, since the First Day Hearing, the negotiations related to
the Original DIP Proposal continued at a rigorous pace and
ultimately resulted in a global agreement between the Original DIP
Parties.
The DIP Facility is a critical component of the transition and will
provide the Debtors with the financing needed to (a) effectuate the
transfer of the GNMA MSR to Longbridge; (b) monetize the other
assets of the Debtors, such as the Debtors' active buyout loans,
non-active buyout loans, and their "Equity Elite" proprietary
reverse mortgage loans; and (c) effectuate an orderly winddown of
the Debtors' estates following the MSR Transfer and the Asset
Monetization.
To (a) complete the transfer of the Note Issuer's Ginnie Mae HECM
MSR business to Longbridge prior to or on January 3, 2023, (b)
provide financing for working capital and other general corporate
purposes, and (c) make any other payments provided in the Interim
DIP Order, Leadenhall and BNGL agreed to provide a secured DIP note
facility to the Debtors in an aggregate amount of no more than
$44.5 million as follows:
-- Leadenhall will advance funds to pay its professionals in
an amount up to $7.5 million;
-- Leadenhall will advance funds under notes in the amount up
to $3.5 million directly to Compu-Link Corporation (d/b/a Celink)
and any additional vendors necessary on the Transfer Date to fund
the out of pocket per loan transfer costs on the Transfer Date;
-- Leadenhall will advance funds under notes in an aggregate
amount of $6.5 million to fund the operating costs and expenses and
Chapter 11 costs;
-- Parent will have advanced, or will advance, as applicable,
funds under notes in the aggregate amount up to $17 million
directly to the Debtors to fund their operating costs and expenses
and Chapter 11 costs -- it being understood and agreed that $10
million was funded on December 5, 2022 and the remaining $7 million
in commitments will be funded on a delayed draw basis in accordance
with the Budget; and
-- The $10 million of funds advanced by Leadenhall on November
17, 2022 under the Existing Loan Agreement to GNMA in respect of
the shortfall of the Note Issuer's November buyout obligations will
be rolled-up with the DIP LH Op Notes subject to the entry of the
Final DIP Orders and the satisfaction by Longbridge of the
so-called ABO/NABO Requirement and Leadenhall's agreement to the
First New Budget.
As adequate protection of any diminution in the value of the
interests of Leadenhall, the Existing Note Providers and the
pre-petition secured claims of the Parent or its affiliates in the
collateral securing
the obligations owed to each of the respective Existing Secured
Parties after the Petition Date, the Existing Secured Parties will
receive:
a) pursuant to Bankruptcy Code Section 361(2), adequate
protection replacement liens on the DIP Collateral subject to the
Carve-Out, the DIP Liens and the TCB DIP Liens;
b) a superpriority administrative expense claim as
contemplated by Sections 507(b) and 364(c)(1) of the Bankruptcy
Code, subject to the Carve-Out, the DIP Notes Superpriority Claim,
and the TCB Superpriority Claim; and
c) as additional adequate protection for Leadenhall, the
assignment to Leadenhall on account of the Existing Leadenhall Loan
of all rights to AAG payments (including, without limitation, any
monthly Premium Recapture Plan component and any AAG Tail GOS
Revenue share payment).
The DIP Order will include relief from the automatic stay to make
such payments as adequate protection.
The "Carve-Out" means the sum of: (i) all fees required to be paid
to the Clerk of the Court and to the U.S. Trustee under 28 U.S.C.
Section 1930(a) plus interest at the statutory rate (without regard
to the notice set forth in clause (iv) below); (ii) fees and
expenses up to $50,000 incurred by a trustee under Sections 726(b)
and 1183(a) of the Bankruptcy Code (without regard to the notice
set forth in clause (iv) below); (iii) to the extent allowed at any
time, whether by interim order, procedural order, or otherwise, all
unpaid professional Fees of professional persons incurred by
persons or firms retained by the Debtors pursuant to section 327,
328 or 363 of the Bankruptcy Code at any time before or on the
first business day following the delivery of a Carve-Out Trigger
Notice; and (iv) Allowed Professional Fees incurred after the first
business day following the Carve-Out Trigger in an aggregate amount
not to exceed $1,500,000 with respect to professional persons.
"Carve-Out Trigger" means the occurrence of a Termination
Declaration or an acceleration of the DIP Loans.
"Termination Declaration" means a written notice from the Borrowers
to the Debtors, counsel to the Committee (if appointed), and the
U.S. Trustee.
The Interim DIP Order and Final DIP Order will provide that a
Committee and any other party in interest must file a pleading with
the Bankruptcy Court challenging the validity, extent, perfection
and/or priority of any claims or security interest of the Existing
Secured Parties no later than 75 days after entry of the Interim
DIP Order. Failure of the Committee or any other party in interest
to file such a pleading with the Bankruptcy Court will forever bar
such party from making such a challenge.
To the extent not already terminated, the DIP Notes will
automatically and permanently terminate on the earliest of these
dates:
a) 35 days after the Interim DIP Order if the Final DIP Order
has not been entered; provided, that in the event entry of the
Interim DIP Order is delayed due to unforeseen delays in obtaining
a hearing with the Bankruptcy Court, the parties will mutually
agree to a reasonable extension,
b) the "effective date" of a chapter 11 plan filed in the
Chapter 11 Cases that is confirmed pursuant to an order entered by
the Bankruptcy Court,
c) the date the Chapter 11 Cases are dismissed or converted to
chapter 7 case(s),
d) the acceleration of the DIP Notes, or
e) June 6, 2023.
The Note Parties will satisfy each of these Milestones:
1. By no later than December 12, 2022, the Bankruptcy Court
will enter the Interim DIP Order, in form and substance reasonably
acceptable to the Debtors, Leadenhall and Parent.
2. By no later than December 15, 2022, the Bankruptcy Court
will have approved the Debtors' motion to approve the Transfer
Motion; provided, that in the event entry of such order is delayed
due to unforeseen delays in obtaining a hearing with the Bankruptcy
Court, the parties will mutually agree to a reasonable extension.
3. By no later than 35 days following the entry of the Interim
DIP Order, the Bankruptcy Court will enter the Final DIP Order, in
form and substance reasonably acceptable to the Debtors, Leadenhall
and Parent; provided, that in the event entry of the Interim DIP
Order is delayed due to unforeseen delays in obtaining a hearing
with the Bankruptcy Court, the parties will mutually agree to a
reasonable extension.
4. By no later than the Transfer Date, the Transfer will have
been consummated.
5. By no later than March 16, 2023, file a chapter 11 plan and
disclosure statement, in each case, satisfactory to the Debtors,
Leadenhall and Parent.
6. By no later than June 4, 2023, the Approved Chapter 11 Plan
will have been confirmed by the Bankruptcy Court.
The DIP Tail Advances will be repaid in full in cash (and, to the
extent not already repaid or terminated, and all commitments
thereunder will automatically and permanently terminate) on the
earliest of these dates:
a) January 31, 2023;
b) December 9, 2022, if the Interim DIP Order has not been
entered,
c) December 16, 2022, if the Bankruptcy Court has not entered
an order approving the transfer stipulation between the Government
National Mortgage Association, Leadenhall, Longbridge, BNGL as RMF
Parent, and the Debtors,
d) 35 days after entry of the Interim Order if the Final DIP
Order has not been entered,
e) the "effective date" of a chapter 11 plan filed in the
Chapter 11 Cases that is confirmed pursuant to an order entered by
the Bankruptcy Court,
f) the date the Chapter 11 Cases are dismissed or converted to
chapter 7 case(s), and
g) the day that is one business day prior to the date upon
which any other postpetition DIP financing facility of the Debtors
is scheduled to mature (as of the Closing Date, without regard to
any extension of such maturity date following the Closing Date).
The DIP Tail Advances require the Debtors to accomplish these
Milestones:
1. By no later than December 9, 2022, the Bankruptcy Court
will enter the Interim DIP Order, in form and substance acceptable
to TCB.
2. By no later than December 16, 2022, the Bankruptcy Court
will enter an order approving the Stipulation.
3. By no later than December 19, 2022, the Debtors'
obligations under the GNMA program requirements
to effectuate and consummate the buyout of the FHA guaranteed loans
will have been fulfilled (whether by the Debtors or another party).
4. By no later than 35 days following entry of the Interim DIP
Order, the Bankruptcy Court will enter the Final DIP Order, in form
and substance reasonably acceptable to TCB.
5. By no later than January 3, 2023, the transfer of the
Borrower's Ginnie Mae HECM servicing rights to Longbridge or some
other party will have been consummated.
6. By no later than December 16, 2022, no less than $60
million of the Advances are securitized by
GNMA by such date.
A final hearing on the matter is set for January 5, 2023 at 10:30
a.m.
About Reverse Mortgage Investment Trust Inc.
Reverse Mortgage Investment Trust Inc. is an originator and
servicer of reverse mortgage loans.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Del. Lead Case No. 22-11225) on November
30, 2022.
In the petition signed by Craig Corn, chief executive officer, the
Debtors disclosed up to $50 billion in both assets and
liabilities.
Judge Mary F. Walrath oversees the case.
The Debtors tapped Sidley Austin LLP as general bankruptcy counsel,
Benesch, Friedlander, Coplan, and Aronoff LLO as local bankruptcy
counsel, FTI Consulting Inc. as financial advisor, and Kroll
Restructuring Administration LLC as noticing and claims agent.
Leadenhall Capital Partners LLP, as agent to the postpetition
secured lenders, is advised by Latham & Watkins LLP and Young,
Conaway Stargatt & Taylor LLP, as counsel; BRG, as financial
advisor; and Moelis as investment banker.
Texas Capital Bank has retained Paul, Weiss, Rifkind, Wharton &
Garrison LLP as counsel.
Longbridge Financial, LLC has retained Weil, Gotshal & Manges LLP,
Lowenstein Sandler LLP, and Richards, Layton & Finger as counsel;
and Houlihan Lokey, Inc., as financial advisor.
SEI INSIEME: Case Summary & Two Unsecured Creditors
---------------------------------------------------
Debtor: Sei Insieme LLC
c/o William Rainero 80 Washington Pl
New York, NY 10011-9116
Business Description: Sei Insieme holds a second mortgage on
the properties located at 307 Sixth
Avenue, NY and 309 Sixth Avenue NY. The
current value of the Debtor's interest in
the Properties is valued at $7.5 million.
Chapter 11 Petition Date: December 13, 2022
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 22-11670
Debtor's Counsel: H Bruce Bronson, Esq.
BRONSON LAW OFFICE, P.C.
480 Mamaroneck Ave
Harrison, NY 10528-1621
Tel: (877) 385-7793
Email: hbbronson@bronsonlaw.net
Total Assets: $7,500,095
Total Liabilities: $5,008,000
The petition was signed by William G. Rainero as managing member.
A full-text copy of the petition containing, among other items, a
list of the Debtor's two unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/4PEK4XA/Sei_Insieme_LLC__nysbke-22-11670__0001.0.pdf?mcid=tGE4TAMA
SONJA COLBERT: Awarded $41,269 in Attorney's Fees
-------------------------------------------------
Bankruptcy Judge Charles Novack for the Northern District of
California awards both the debtor Sonja Nicolle Colbert and
creditor Cleveland Mitchell with attorney's fees arising from the
multi-day evidentiary hearing that resolved Colbert's objection to
Mitchell's amended proof of claim.
Colbert owns a multi-unit residential apartment building at 1864
11th Avenue in Oakland, California, and Mitchell resided in a unit
in the building for over three years. After he vacated his unit,
Mitchell commenced litigation in Alameda County Superior Court
against Colbert regarding his apartment's habitability and
Colbert's allegedly retaliatory conduct. Colbert's Chapter 11
bankruptcy filing stayed the Superior Court litigation, and
Mitchell's timely filed proof of claim is based on his Superior
Court complaint. The proof of claim/complaint asserts causes of
action for tortious and contractual breach of the implied warranty
of habitability, violations of California Civil Code, breach of
contract, statutory breach of quiet enjoyment, private nuisance,
premises liability under California Civil Code, negligence,
violation of the City of Oakland's Just Cause and Tenant Protection
Ordinances, Unfair Business Practices under California Business and
Professions Code, and common law retaliatory eviction. The
complaint's prayer for relief requested damages and attorney's fees
under several of the above statutes, including Cal. Civ. Code
Sections 1942.4 and 1942.5.
The Court found that Colbert had unlawfully retaliated against
Mitchell (under Cal. Civ. Code Section 1942(c)) when she served an
eviction notice for unpaid rent that an unlawful detainer jury had
only days before determined was not owed. The Court awarded $15,000
in damages as compensation for Colbert's violation of Cal. Civ.
Code section 1942.5(c). However, the Court held that Colbert was
not liable on Mitchell's remaining causes of action, including his
claim that Colbert had also retaliated against him under Cal. Civ.
Code Section 1942.5(a). In summary, Colbert prevailed on all but
one of the causes of actions tried by the Court.
As a result, both parties argue that they prevailed under sections
of the California Civil Code that award fees to the prevailing
party, and they both seek to recover their reasonable fees. Colbert
seeks $52,098 in fees, while Mitchell requests $1,465 in costs and
$187,500 in fees.
Colbert was represented by Mark Voisenat. Voisenat's time records
state that he billed 122.58 hours on this contested matter at
$425/hour. Mitchell does not object to this hourly rate, and the
Court finds that it is reasonable and within the realm of the
hourly prevailing rate for private attorneys in the Oakland,
California legal community who handle similar litigation on a
non-contingency basis. Voisenat seeks fees reflecting 122.58 hours
of his time. But the Court finds that some of this time is clearly
unrelated to the Sections 1942.4 and 1942.5 claims -- this reduces
Voisenat's base lodestar amount to $51,587. The Court also
reasonably estimates that 20% of Voisenat's hours relate to the one
claim that Mitchell prevailed on, reducing his base lodestar amount
to $41,269. However, the Court cannot reasonably further reduce
these fees. While Voisenat's litigation of the section 1942.4 claim
ended with the Court's entry of its Rule 7052(c) order, Colbert's
case in chief primarily addressed the retaliation claims. The Court
cannot untangle these claims. Therefore, the Court awards Colbert
$41,269 in fees.
The Court is also awarding attorney's fees to Mitchell due to his
successful litigation of one of his Section 1942(c) claims. Just
because Colbert was awarded fees does not mean that she will be
able to collect any of them directly from Mitchell -- for he is a
disabled senior citizen with little income and whose assets may
well be exempt.
Mitchell was represented by Tony Ruch of the Law Offices of Andrew
Wolff, P.C. Ruch billed 250 hours at $500/hour and is seeking a 1.5
multiplier. His requested fees total $187,500 (after the
multiplier), and he seeks $1,465 in costs. To start, the Court
finds that some of Ruch's time was distinctly unrelated to
Mitchell's Section 1942.5(c) claim. Hence, this reduces his base
(pre-multiplier) lodestar amount to $118,900. In addition, Mitchell
prevailed on a specific allegation of retaliatory conduct which had
little factual overlap with his other claims. The Court believes
that only 20% of Ruch's pre-trial, trial, and post-trial work
related to his client's one successful claim, reducing his fees to
$23,780. Given the length of this contested matter and its
difficulty, the Court believes that a 1.5 multiplier is
appropriate, bringing Mitchell's fee award to $35,670. The Court
has reviewed and awards Michell his costs.
Voisenat has informed this court that Colbert will propose a
Chapter 11 plan that will fully pay general, unsecured creditors.
Accordingly, Colbert may offset her attorney's fee award against
the damages, attorney's fees, and costs that she owes to Mitchell.
A full-text copy of the Memorandum Decision and Order dated Nov.
30, 2022, is available at https://tinyurl.com/4ysabfwt from
Leagle.com.
Sonja Nicolle Colbert sought Chapter 11 protectin (Bankr. N.D. Cal.
Case No. 19-41729) on July 30, 2019. The Debtor tapped Marc
Voisenat, Esq., at Law Offices of Marc Voisenat, as counsel.
THOMPSON ROSE: Trustee Gets OK to Tap Gabrielson & Co as Accountant
-------------------------------------------------------------------
Lisa Holder, the Chapter 11 trustee for Thompson Rose Chapel, LLC,
received approval from the U.S. Bankruptcy Court for the Eastern
District of California to employ Gabrielson & Company as its
accountant.
The firm's services include:
(a) preparing all necessary estate income tax returns for the
Debtor's estate and representing the trustee and the estate before
the federal, state and local tax authorities; and
(b) preparing all required Chapter 11 financial and accounting
reports, including monthly operating reports and tax or accounting
analyses, as requested by the trustee.
The firm will be paid at the rate of $425 per hour.
Michael Gabrielson, a partner at Gabrielson & Company, disclosed in
a court filing that his firm is a "disinterested person" as the
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached at:
Michael Gabrielson
Gabrielson & Company
711 Grand Ave. Ste 100
San Rafael, CA 94901
About Thompson Rose Chapel
Thompson Rose Chapel, LLC -- https://www.thompsonrosechapel.com/ --
is an independent family-owned funeral home and has been serving
families in Sacramento and surrounding counties since 1948. Its
motto is "Families Come First". The business is located at 3601 5th
Ave., Sacramento, Calif.
Thompson Rose Chapel sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. E.D. Cal. Case No. 22-21727) on July 12,
2022. In the petition filed by its managing member, Ginger Brown,
the Debtor listed $1 million to $10 million in both assets and
liabilities.
Judge Christopher D. Jaime oversees the case.
Gabriel E. Liberman, Esq., at the Law Offices of Gabriel Liberman,
APC is the Debtor's counsel.
Lisa Holder was appointed as trustee in this Chapter 11 case. The
trustee tapped Pino & Associates as general bankruptcy counsel and
Gabrielson & Company as accountant.
THREE ARROWS CAPITAL: Founders Not Helping With Recovery of Assets
------------------------------------------------------------------
Dietrich Knauth of Reuters reports that liquidators for bankrupt
crypto hedge fund Three Arrows Capital(3AC) said earlier this month
that the company's founders are refusing to cooperate with asset
recovery efforts, hindering the company's ability to return funds
to creditors.
Founders Kyle Davies and Su Zhu are more interested in
rehabilitating their reputation than helping their own company's
creditors, the liquidators' attorney Adam Goldberg said in
bankruptcy court in New York. Davies has done interviews recently
commenting on the implosion of crypto exchange FTX, attempting to
shift blame for Three Arrows' own collapse.
"It's interesting to say the least, that the first time we've heard
this theory that FTX caused the downfall of this debtor was after
FTX's own sensational collapse," Goldberg said.
Davies said in a Nov. 16 interview with CNBC that FTX and its
affiliated trading platform Alameda Research "hunted our
positions," crashed the price of the cryptocurrency Luna, and "took
us down." Davies also said he was cooperating with the fund's
liquidators.
Goldberg disputed Davies' assertions on Friday, Dec. 2, 2022,
saying that he and Zhu took steps to undermine asset recovery
efforts.
Someone had "ransacked" hard drives from locked Three Arrows
offices before the liquidators gained access, and investigators
determined that the founders had spent company money on a
super-yacht called "Much Wow," Goldberg said. The liquidators are
attempting to recover $30 million spent on the yacht, and will
bring other recovery actions in the near future, Goldberg said.
Davies said on Saturday in a tweet that he is of the view that the
liquidators have not engaged with them "constructively".
"It appears to us that they are intent on making threats against
us, and spending a lot of time, and money on continuing court
proceedings in number of jurisdictions, like Singapore, the U.S.
and the BVI (British Virgin Islands)," he added in a statement
posted on Twitter.
He also said he is pursuing setting up a round table discussion
with creditors to talk through asset recovery and a path forward.
Three Arrows said in a Friday court filing that the founders are
currently based in the United Arab Emirates and Indonesia,
countries not known for cooperating with international court
orders.
Despite incomplete access to records and accounts, Three Arrows'
liquidators have recovered some assets belonging to creditors,
including $35 million in U.S. dollars and several different
cryptocurrency tokens, liquidator Russell Crumpler said in court.
Recovery efforts are ongoing, Crumpler said.
Crumpler did not say how much cryptocurrency the liquidators have
recovered, but he said that Singapore-based Three Arrows has
regained control over accounts that held more than 60 different
types of cryptocurrency tokens.
Three Arrows was the first major crypto firm to go bankrupt in
2022, brought down by the collapse of cryptocurrencies Luna and
TerraUSD in May. It filed for bankruptcy in the British Virgin
Islands in late June. The liquidators were appointed by that court
to wind down the company and pay its debts. They filed a parallel
bankruptcy case in Manhattan to shield Three Arrows' U.S. assets.
About Three Arrows Capital
Three Arrows Capital Ltd. was an investment firm engaged in
short-term opportunities trading, and is heavily invested in
cryptocurrency, funded through borrowings.
As of April 2022, the Debtor was reported to have over $3 billion
of assets under its management.
Three Arrows Capital Ltd. was incorporated as a business company
under the laws of the British Virgin Islands. Its sole shareholder
owning all of its "management shares" is Three Arrows Capital Pte.
Ltd., which previously operated as a regulated fund manager in
Singapore until 2021, when it shifted its domicile to the BVI, as
part of a global corporate plan to relocate operations to Dubai.
The Debtor borrowed digital and fiat currency from multiple lenders
to fund its cryptocurrency investments. After cryptocurrency lost
99% of its value, and then prices of other cryptocurrencies had
rapid declines, the Debtor reportedly defaulted on its
obligations.
On June 24, 2022, one of the Debtor's many creditors -- DRB Panama
Inc. -- filed an application to appoint joint provisional
liquidators -- and thereafter, full Liquidators -- in the Eastern
Caribbean Supreme Court in the High Court of Justice (Commercial
Division) located in BVI. The application was assigned claim number
VIHCOM2022/0117.
Subsequently, on June 27, 2022, the Debtor filed its own
application for the appointment of joint liquidators before the BVI
Commercial Court.
On June 29, 2022, the Honorable Mr. Justice Jack of the BVI
Commercial Court appointed Russell Crumpler and Christopher Farmer
of Teneo (BVI) Limited as joint liquidators of Three Arrows Capital
Ltd.
On July 1, 2022, liquidators of Three Arrows Capital filed a
Chapter 15 bankruptcy in the U.S. (Bankr. S.D.N.Y. Case No.
22-10920) to seek recognition of the BVI proceedings. Judge Martin
Glenn is the case judge. Latham & Watkins, led by Adam J. Goldberg
is counsel in the U.S. case.
The law firm of Ogier, led by Grant Carroll, is advising the
liquidators in the BVI proceedings.
TIMBER PHARMACEUTICALS: Regains Compliance With NYSE Listing Rule
-----------------------------------------------------------------
Timber Pharmaceuticals, Inc. said it has received formal notice
from The NYSE American LLC stating that the Company has regained
compliance with the NYSE American's continued listing standards.
The notice the Company received from NYSE American on Dec. 8, 2022
noted that the Company resolved the continued listing deficiency
with respect to its low selling price as described in Section
1003(f)(v) of the NYSE American Company Guide.
About Timber Pharmaceuticals
Timber Pharmaceuticals, Inc. f/k/a BioPharmX Corporation --
http://www.timberpharma.com-- is a biopharmaceutical company
focused on the development and commercialization of treatments for
orphan dermatologic diseases. The Company's investigational
therapies have proven mechanisms-of-action backed by decades of
clinical experience and well-established CMC (chemistry,
manufacturing and control) and safety profiles. The Company is
initially focused on developing non-systemic treatments for rare
dermatologic diseases including congenital ichthyosis (CI), facial
angiofibromas (FAs) in tuberous sclerosis complex (TSC), and
localized scleroderma.
Timber Pharmaceuticals reported a net loss of $10.64 million for
the year ended Dec. 31, 2021, compared to a net loss of $15.12
million for the year ended Dec. 31, 2020. As of Sept. 30, 2022,
the Company had $12.79 million in total assets, $5.15 million in
total liabilities, and $7.63 million in total stockholders'
equity.
Short Hills, New Jersey-based KPMG LLP, the Company's auditor since
2019, issued a "going concern" qualification in its report dated
March 31, 2022, citing that the Company has suffered recurring
losses from operations that raise substantial doubt about its
ability to continue as a going concern.
TITAN INTERNATIONAL: S&P Upgrades ICR to 'B' on Deleveraging
------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on Titan
International Inc. to 'B' from 'B-'.
At the same time, S&P raised its issue-level rating on Titan's
senior secured notes to 'B' from 'B-'. S&P's '4' recovery rating on
the senior secured notes (30%-50%; rounded estimate: 40%) remains
unchanged.
The stable outlook reflects S&P's expectation that the company's
debt leverage will remain below 3x over the next 12 months.
S&P said, "Titan has benefited from solid demand in its key end
markets, which we expect will remain healthy in 2023. In 2022, we
forecast the company will increase its revenue by the low-20% area
due to healthy demand for equipment across its key agricultural,
construction, and mining end markets. We also expect sustained
farmer profitability in 2023, with elevated commodity prices
offsetting the inflation in input costs, which we believe will
translate to healthy demand in the agricultural end market. In the
mining end market, we expect commodity prices will support
continued mining activity. We also anticipate a moderation in
non-residential construction activity due to the higher
interest-rate environment, which will be somewhat offset by the
deployment of capital related to the recently passed Infrastructure
Investment and Jobs Act and Inflation Reduction Act. Overall, we
assume Titan will experience some moderation in its revenue
expansion (falling to a low- to mid-single digit percent
improvement) in 2023."
A strong improvement in the company's revenue and operating
leverage will support material deleveraging through the end of
2022, with further very modest deleveraging in 2023. Titan operates
with a high fixed-cost base and its operating leverage is highly
sensitive to fluctuations in its volume. S&P said, "Given our
expectation for a healthy increase in its revenue in 2022, we
forecast its S&P Global Ratings-adjusted EBITDA margin will expand
by about 300 basis points (bps)-400 bps in 2022, primarily due to
the improvement in its operating leverage with further support from
price increases, partly offset by higher input costs. This margin
improvement will translate to a significant expansion in its S&P
Global Ratings-adjusted EBITDA of about 60%-80% in 2022. In 2023,
we expect relatively flat margins and very modest deleveraging due
to a significant moderation in its volume expansion from the robust
levels in 2022."
S&P said, "However, Titan's business remains highly cyclical and
our rating incorporates a cushion in its credit metrics for a
potential cyclical downturn. We believe there is some downside risk
to the broader economic outlook for 2023 due to rising prices and
interest rates, as well as ongoing geopolitical uncertainties.
Consequently, we believe a larger-than-expected slowdown in the
economy, a material decline in net farmer income, or a significant
drop in commodity prices could translate to a sizeable reduction in
equipment spending. We believe Titan's S&P Global Ratings-adjusted
leverage could fluctuate by more than 2 turns between periods of
favorable and unfavorable market conditions.
"The stable outlook reflects our expectation that Titan's S&P
Global Ratings-adjusted leverage will remain below 3x over the next
12 months supported by continued healthy demand in its agricultural
and mining end markets."
S&P could lower its rating on Titan if it believes:
-- During unfavorable market conditions, the company's S&P Global
Ratings-adjusted debt leverage will rise above 5.0x;
-- During favorable market conditions, the company's S&P Global
Ratings-adjusted debt leverage will rise above 3.0x due to
debt-funded acquisitions or share repurchases, which would erode
its cushion to withstand a potential economic downturn; or
-- The company will consistently generate S&P Global
Ratings-adjusted free operating cash flow (FOCF) to debt of less
than 5%.
Although unlikely over the next 12 months, S&P could raise its
rating on Titan if it believes:
-- The company will maintain S&P Global Ratings-adjusted leverage
of less than 4.0x, including amid unfavorable market conditions,
which incorporates the potential it will undertake debt-funded
acquisitions and share repurchases; and
-- The company will generate S&P Global Ratings-adjusted FOCF to
debt of more than 10% through the economic cycle.
ESG credit indicators: E-2, S-2, G-3
TITLE PIPE: Taps Michael Tobiason of Azada CPA as Expert Witness
----------------------------------------------------------------
Title Pipe, Inc. seeks approval from the U.S. Bankruptcy Court for
the District of Idaho to employ Michael Tobiason of Azada CPA as
expert witness.
Mr. Tobiason has agreed to provide an opinion as to the value of
the Debtor's assets for an hourly fee of $250.
In court filings, Mr. Tobiason disclosed that he does not have an
interest materially adverse to the interest of the Debtor's estate,
creditors and equity security holders.
The firm can be reached at:
Michael A. Tobiason
Azada CPA
2470 W. Horizon Ridge Pkwy #120
Henderson, NV 89052
Tel: (702) 509-9824
Fax: (888) 540-7613
Email: mike@azadacpa.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, with between $100,000 and $500,000 in assets and between
$1 million and $10 million in liabilities. The Debtor has elected
to proceed under Subchapter V of Chapter 11. Matthew W. Grimshaw of
Grimshaw Law Group, P.C. is the Subchapter V trustee.
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.
TRANSOCEAN LTD: Gets $1.04BB in Contract Awards for Two Drillships
------------------------------------------------------------------
Transocean Ltd. announced awards for its ultra-deepwater
drillships, Deepwater Corcovado and Deepwater Orion, for work
offshore Brazil with a national oil company. Together the two
contracts represent approximately $1.04 billion in firm backlog.
Deepwater Corcovado was awarded a four-year contract, which
contributes an estimated $583 million in backlog and is expected to
begin in the third quarter of 2023 in direct continuation of the
rig's current contract.
Deepwater Orion was awarded a three-year contract, which
contributes an estimated $456 million in backlog and is expected to
commence during the fourth quarter of 2023.
About Transocean
Transocean Ltd. is an international provider of offshore contract
drilling services for oil and gas wells. The Company specializes
in technically demanding sectors of the offshore drilling business
with a particular focus on ultra-deepwater and harsh environment
drilling services.
Transocean reported a net loss of $591 million for the year ended
Dec. 31, 2021, a net loss of $568 million for the year ended Dec.
31, 2020, and a net loss of $1.25 billion for the year ended Dec.
31, 2019. As of Sept. 30, 2022, the Company had $20.62 billion in
total assets, $1.50 billion in total current liabilities, $7.88
billion in total long-term liabilities, and $11.23 billion in total
equity.
* * *
As reported by the TCR on Oct. 18, 2022, S&P Global Ratings raised
the issuer credit rating on Switzerland-domiciled offshore drilling
contractor Transocean Ltd. to 'CCC' from 'SD'. The upgrade
reflects Transocean's enhanced liquidity runway.
TUFF TURF: Starts Subchapter V Bankruptcy Process
-------------------------------------------------
Tuff Turf Inc. filed for chapter 11 protection in the District of
Kansas. The Debtor elected on its voluntary petition to proceed
under Subchapter V of chapter 11 of the Bankruptcy Code.
According to Website https://www.tuffturfkc.com/, the Debtor is a
Merriam, Kansas-based provider of landscaping services.
The Debtor disclosed $670,640 in assets against $1,484,129 in total
liabilities in its schedules. The petition states that funds will
be available to unsecured creditors.
The Debtor filed a motion to pay prepetition wages and prohibit
utilities from discontinuing service.
The Debtor currently maintains a total of 15 employees, including
the principal, Mr. Matthew Nelson, and the former majority owner,
Jason Williamson. Mr. Nelson and Mr. Williamson are salaried
employees, while the remaining 13 employees are paid in a range of
$18-24 per hour. Mr. Nelson's salary is currently set at $50,000
per year, and Mr. Williamson's at $75,000 per year.
A meeting of creditors under 11 U.S.C. Section 341(a) is slated for
Jan. 5, 2023, at 2:00 PM. Proofs of claim are due by Feb. 10,
2023.
About Tuff Turf Inc.
Tuff Turf Inc. -- https://www.tuffturfkc.com/ -- provides high
quality landscaping services in a timely manner.
Tuff Turf Inc. filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code (Bankr. D. Kan. Case No.
22-21176) on Dec. 2, 2022. In the petition filed by Matt Nelson,
as secretary and vice-president, the Debtor reported assets between
$500,000 and $1 million and liabilities between $1 million and $10
million.
Kent L Adams has been appointed as Subchapter V trustee.
The Debtor is represented by:
Ryan A Blay, Esq.
WM Law
5948 MERRIAM DR
Shawnee, KS 66203-3162
VBI VACCINES: Health Canada OKs PreHevbrio for Hepa B Prevention
----------------------------------------------------------------
VBI Vaccines Inc. announced that Health Canada has approved
PreHevbrio [3-antigen Hepatitis B Vaccine (Recombinant)] for active
immunization against infection caused by all known subtypes of
hepatitis B (HBV) virus in adults 18 years of age and older. It
can be expected that hepatitis D will also be prevented by
immunization with PreHevbrio as hepatitis D (caused by the delta
agent) does not occur in the absence of hepatitis B infection.
"We are excited to announce Health Canada's approval, a fourth
regulatory approval for this vaccine, and an achievement that is
another meaningful step in our effort to provide broad access to
our 3-antigen hepatitis B vaccine," said Jeff Baxter, VBI's
president and CEO. "As we've said many times, we believe
PreHevbrio has the potential to be a meaningful and differentiated
tool that can help healthcare providers make a difference in the
fight to eradicate hepatitis B, and we look forward to supporting
public health initiatives in Canada to facilitate this."
The approval was based on clinical data in the new drug submission
(NDS), which highlighted the positive results from two pivotal,
randomized, double-blind, controlled Phase 3 clinical studies,
PROTECT and CONSTANT. Data from these studies were published,
respectively, in The Lancet Infectious Diseases in May 2021 and The
Journal of the American Medical Association Network Open in October
2021. Both studies compared PreHevbrio to Engerix-B, a
single-antigen HBV vaccine. Results from the PROTECT study showed
that PreHevbrio elicited higher rates of seroprotection in all
subjects age 18+ (91.4% vs. 76.5%), including in adults age 45+
(89.4% vs. 73.1%). The PROTECT study results also showed that
PreHevbrio induced higher rates of seroprotection in subjects with
diabetes (83.3% vs. 58.3%) as well as in subjects with body mass
index (BMI) over 30 (89.22% vs. 68.11%). The integrated safety
analysis of both studies demonstrated good tolerability with no
unexpected reactogenicity. The most common adverse events in all
age groups were injection site pain and tenderness, myalgia, and
fatigue, all which generally resolved without intervention in 1-2
days.
About VBI Vaccines
VBI Vaccines Inc. -- www.vbivaccines.com -- is a biopharmaceutical
company driven by immunology in the pursuit of powerful prevention
and treatment of disease. Through its innovative approach to
virus-like particles ("VLPs"), including a proprietary enveloped
VLP ("eVLP") platform technology, VBI develops vaccine candidates
that mimic the natural presentation of viruses, designed to elicit
the innate power of the human immune system. VBI is committed to
targeting and overcoming significant infectious diseases, including
hepatitis B, coronaviruses, and cytomegalovirus (CMV), as well as
aggressive cancers including glioblastoma (GBM). VBI is
headquartered in Cambridge, Massachusetts, with research operations
in Ottawa, Canada, and a research and manufacturing site in
Rehovot, Israel.
VBI Vaccines reported a net loss of $69.75 million for the year
ended Dec. 31, 2021, compared to a net loss of $46.23 million for
the year ended Dec. 31, 2020. As of Sept. 30, 2022, the Company
had $172.01 million in total assets, $34.68 million in total
current liabilities, $53.51 million in total non-current
liabilities, and $83.82 million in total stockholders' equity.
Iselin, New Jersey-based EisnerAmper LLP, the Company's auditor
since 2016, issued a "going concern" qualification in its report
dated March 7, 2022, citing that the Company has an accumulated
deficit as of Dec. 31, 2021, and cash outflows from operating
activities for the year-ended Dec. 31, 2021 and, as such, will
require significant additional funds to conduct clinical and
non-clinical trials, achieve regulatory approvals, and subject to
such approvals, commercially launch its products. These factors
raise substantial doubt about its ability to continue as a going
concern.
VISION DEMOLITION: May Use Cash Collateral Thru Dec 19
------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana,
Indianapolis Division, authorized Vision Demolition and Excavating,
LLC to use cash collateral in accordance with the provisions of the
prior Interim Cash Use Orders, except as modified, including any
amount held in an account that was subject to a garnishment order
on the Petition Date, in the ordinary course of business on a
continued interim basis through December 19, 2022.
The Debtor is permitted to use cash collateral in accordance with
the budget, with a 10% variance.
The Debtor represented that Commercial Credit Group may have made
loans to the Debtor pursuant to various loan documents.
The Debtor is indebted to the Secured Creditor in total
approximately $732,486.
As adequate protection, the Secured Creditor will be granted valid
and perfected security interests and replacement liens in the cash
collateral and in the post-petition property of the Debtor of the
same nature and to the same extent and in the same priority held in
the cash collateral on the Petition Date. The Adequate Protection
Liens will be valid and fully perfected without any further action
by any party and without the execution or the recordation of any
control agreements, financing statements, security agreements, or
other documents.
As adequate protection to CCG with respect to its interest in
non-cash collateral assets, the Debtor will make monthly adequate
protection payments to CCG in the amount of $21,013, starting on
December 3, 2022 and continuing on the third day of each month
thereafter until the effective date of a confirmed chapter 11
plan.
Unless agreed to by CCG in writing or otherwise extended by the
Court, after notice and hearing, the Debtor's authorization to use
the cash collateral will immediately cease and terminate on the
earliest to occur of: (a) the date on which CCG provides, via
facsimile, e-mail or overnight mail, written notice to the Debtor
or Debtor's counsel, of the occurrence of an Event of Default, and
the expiration of a five business day cure period; or (b) December
19, 2022 or a later date as the Court orders.
These events constitute an "Event of Default:"
a. The removal of the Debtor as debtor-in-possession;
b. The Debtor's Chapter 11 case is converted to a Chapter 7
case or dismissed;
c. The Debtor fails to comply with any term of the Order,
including but not limited to its payment obligations and compliance
with the Budget;
d. The Debtor makes any payment not set forth in the Budget;
and
e. The Debtor fails to comply with any of the adequate
protection or reporting obligations set forth therein.
A final hearing on the matter is set for December 19 at 3 p.m. via
Zoom.
A copy of the order is available at https://bit.ly/3YlYvPa from
PacerMonitor.com.
About Vision Demolition and Excavating, LLC
Vision Demolition and Excavating, LLC is an excavating contractor
specializing in both residential and commercial projects. The
Debtor sought protection under Chapter 11 of the U.S. Bankruptcy
Code (Bankr. S.D. Ind. Case No. 22-04156) on October 17, 2022. In
the petition signed by Stacy Payne Miller, president, the Debtor
disclosed $818,300 in assets and $1,060,830 in liabilities.
Judge Jeffrey J. Graham oversees the case.
KC Cohen, Esq., at KC Cohen, Lawyer, PC, is the Debtor's legal
counsel.
VJGJ INC: KeySource's Bid to Dismiss Administrator's Appeal Granted
-------------------------------------------------------------------
District Judge Maryellen Noreika grants the motion to dismiss filed
by KeySource Acquisition, LLC and dismisses the appealed case
styled In re VJGJ, Inc., et al., Chapter 11, Post-Effective Date
Debtors. Alfred Giuliano, as Plan Administrator for the
Post-Effective Date Debtors, Appellant, v. Keysource Acquisition,
LLC, Appellee, C.A. No. 22-989 (MN), (D. Del.).
Alfred Giuliano, in his capacity as plan administrator for VJGJ,
Inc. and the Post-Effective Date Debtors, filed an appeal from an
amended order of the bankruptcy court which allows KeySource
Acquisition, LLC an administrative expense claim in an amount to be
determined by later proceeding.
KeySource has moved to dismiss the appeal on the basis that the
amended order is not a final order, as it does not determine the
amount of KeySource's allowed administrative claim, and the Court
therefore lacks appellate jurisdiction to hear the appeal.
On April 13, 2022, KeySource filed a motion for allowance of an
administrative expense claim in connection with certain products it
purchased from the Debtors which were later recalled. At the
hearing, the bankruptcy court advised that it would grant the
Administrative Expense Motion solely with respect to the issue of
liability while deferring its ruling on the amount of the claim to
a later date, explaining that "we are not necessarily calculating a
particular amount here, but that the primary purpose of our
colloquy today was to determine whether or not . . . KeySource . .
. is entitled to an administrative claim." On June 22, 2022,
however, the bankruptcy court entered an order that KeySource "is
allowed an administrative expense claim in the amount of $237,446
for the Recalled Product."
As discussed at the July 7 Plan Confirmation Hearing, the Debtors,
their prepetition lenders, and the Official Committee of Unsecured
Creditors believed that the Original Order fixing an amount of
KeySource's administrative expense was entered in error and
believed that the June 17 hearing did not -- and was not intended
to -- address the amount of any allowed administrative expense of
KeySource. At the Debtors' request, the bankruptcy court entered an
order amending the Original Order allowing KeySource's
administrative expense claim "in an amount to be determined." Two
days after entry of the Amended Order, the Plan Administrator filed
this appeal from the Original Order, as amended by the Amended
Order.
On Aug. 11, 2022, the bankruptcy court issued a letter addressing
the Amended Order and offering a further hearing to the parties to
fix the amount of KeySource's administrative expense claim. As
KeySource correctly asserts, the bankruptcy court is unable at this
time to fix the amount of KeySource's administrative expense claim
because the Plan Administrator's appeal of the Amended Order has
divested the bankruptcy court of jurisdiction over the matter.
The Plan Administrator argues that the Amended Order should be
construed as a final order. According to the Plan Administrator, an
order establishing merely the priority for a claim and not the
amount can be appealed as a final order under 28 U.S.C. section
158(a)(1).
The Court determines that the Amended Order does not "finally
settle" KeySource's administrative expense claim because the
Amended Order does not set an amount for the claim, but rather
states that the amount is "to be determined." The Court explains
that the resolution of an appeal regarding the claim's priority
will not obviate the need for further action by the bankruptcy
court, as the claim's amount must still be determined. On the other
hand, if the Court grants the Motion to Dismiss, the bankruptcy
court may proceed to fix the amount of the claim. Then, if a party
wishes to appeal at that point, all issues with respect to the
allowed claim can be put before this Court in one appeal.
Accordingly, the Court rules that judicial economy weighs against a
finding of finality and in favor of dismissal this appeal.
A full-text copy of the Memorandum Order dated Nov. 30, 2022, is
available at https://tinyurl.com/yc3jc6a4 from Leagle.com.
About Teligent Inc.
Teligent, Inc., a specialty generic pharmaceutical company,
develops, manufactures, markets, and sells generic topical, branded
generic, and generic injectable pharmaceutical products in the
United States and Canada. The company was formerly known as IGI
Laboratories, Inc. and changed its name to Teligent, Inc. in
October 2015. Teligent, Inc. was founded in 1977 and is based in
Buena, N.J.
Teligent Inc. and three affiliates sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 21-11332) on Oct. 14, 2021. The
cases are handled by Honorable Judge Brendan Linehan Shanno.
As of Aug. 31, 2021, Teligent had total assets of $85 million and
total debt of $135.8 million.
The Debtors tapped Young Conaway Stargatt & Taylor, LLP as
bankruptcy counsel; K&L Gates, LLP as special corporate counsel;
Raymond James & Associates, Inc. as investment banker;
PharmaBioSource Realty, LLC as real estate consultant; and Portage
Point Partners, LLC, as restructuring advisor. Vladimir Kasparov
of Portage Point Partners serves as the Debtors' chief
restructuring officer. Epiq Corporate Restructuring, LLC is the
claims and noticing agent and administrative advisor.
The U.S. Trustee for Region 3 appointed an official committee of
unsecured creditors in the Debtors' cases on Oct. 27, 2021. Jenner
& Block, LLP and Saul Ewing Arnstein & Lehr, LLP serve as the
committee's bankruptcy counsel. Province, LLC is the committee's
financial advisor.
Latham & Watkins LLP, serves as co-counsel to the Prepetition First
Lien Parties and the Senior DIP Parties. Morgan Lewis & Bockius LLP
serves as co-counsel to the DIP Junior Term Loan Parties and
Prepetition Second Lien Parties. Morris, Nichols, Arsht & Tunnell
LLP serves as co-counsel to the DIP Parties and Prepetition Secured
Parties. Jenner & Block LLP serves as co-counsel to the Creditors'
Committee. Osler, Hoskin & Harcourt LLP, serves as Canadian
counsel to both the DIP Junior Term Loan Parties and the Senior DIP
Parties. NautaDutilh Avocats Luxembourg S.a r.l., as Luxembourg
serves as counsel to both the DIP Junior Term Loan Parties and the
Senior DIP Parties. TGS Baltric is the Estonian counsel to both
the DIP Junior Term Loan Parties and the Senior DIP Parties.
* * *
Leiters, Inc., acquired the Debtors' facility for $27,000,000, and
Hikma Canada Limited acquired the Debtors' Canadian assets for
$45,750,000. PAI Holdings, LLC, bought the Debtors' U.S. Marketing
Authorizations for $14,420,000.
On March 28, 2022, Teligent, Inc., Igen, Inc., Teligent Pharma,
Inc., and TELIP, LLC caused their legal names to be changed to
VJGJ, Inc., WRCC, Inc., OSL, Inc., and TNova, LLC, respectively.
W.A. LYNCH: Wins Interim Cash Collateral Access
-----------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Indiana,
Indianapolis Division, authorized W.A. Lynch Construction, LLC to
use cash collateral on an interim basis in accordance with the
budget through January 6, 2023.
The Debtor requires the use of cash collateral to continue to
operate its business and to attempt a successful reorganization
pursuant to the provisions of Chapter 11 of the Bankruptcy Code.
The Debtor represented that several creditors may claim a properly
perfected lien against the Debtor's assets, including cash
collateral, in the Debtor's cash collateral, to secure claims
estimated to exceed the value of cash collateral.
The Debtor acknowledges that it entered into transactions with
WeFund, True Business Funding, LLC, Vivian Capital Group, LLC and
Pinnacle Business Funding, LLC pre-petition and that the Funders
assert that they purchased receivables from the Debtor under those
transactions and that, as a result, the receivables are not
property of the bankruptcy estate and cannot be used by the Debtor
as cash collateral.
The Debtor is permitted to use up to a maximum of $500,000,
provided that the expenses made for any category will not exceed
more than 10%.
The Debtor is required to pay the Funders $30,000 on or before
December 30, 2022. The Funders will determine how such funds will
be disbursed among them prior to December 30.
The Funders and all parties with an interest in the cash collateral
will be granted replacement liens in the cash collateral and in the
post-petition property of the Debtor of the same nature and to the
same extent and in the same priority held in the cash collateral on
the Petition Date. The adequate protection liens will be valid and
fully perfected without any further action by any party and without
the execution or the recordation of any control agreements,
financing statements, security agreements, or other documents.
The Debtor's authorization to use the cash collateral will
immediately terminate on the earlier to occur of: (a) the date on
which any creditor provides, via facsimile, e-mail or overnight
mail, written notice to the Debtor or Debtor's counsel, of the
occurrence of an Event of Default, and the expiration of a 10
business day cure period; or (b) January 6, 2023.
These events constitute an Event of Default:
i. The Debtor's case case is converted to a Chapter 7 case or
dismissed;
ii. The Debtor fails to comply with any term of the Order,
including but not limited to its payment obligations and compliance
with the Budget;
iii. The Debtor makes any payment not set forth in the Budget;
iv. The Debtor fails to comply with any of the adequate
protection or reporting obligations set forth therein.
A final hearing on the matter is set for January 5 at 1:30 p.m.
A copy of the order is available at https://bit.ly/3Yk7IHv from
PacerMonitor.com.
About W.A. Lynch Construction, LLC
W.A. Lynch Construction, LLC is a leader in the construction
industry focused on commercial concrete, construction, design, and
build. The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Ind. Case No. 22-04836) on December 1,
2022. In the petition signed by William A. Lynch, president, the
Debtor disclosed up to $50,000 in assets and up to $10 million in
liabilities.
Judge Jeffrey J. Graham oversees the case.
Harley K. Means, Esq., at Kroger, Gardis & Regas, LLP, represents
the Debtor as legal counsel.
WALKER & DUNLOP: S&P Affirms 'BB' ICR, Outlook Stable
-----------------------------------------------------
S&P Global Ratings affirmed its 'BB' issuer credit rating on Walker
& Dunlop Inc. (WD). The outlook remains stable.
S&P said, "At the same time, we lowered our issue rating on WD's
term loan to 'BB+' from 'BBB-'. We revised our recovery rating on
the term loan to '2' from '1', indicating our expectation of
substantial (70%-90%; rounded estimate: 85%) recovery in the event
of default.
"We lowered our rating on Walker & Dunlop's term loan to reflect
our reduced recovery expectations for the term loan debtholders. WD
plans to issue an incremental $200 million add-on to its existing
$595.5 million senior secured term loan and use the proceeds to
repay the outstanding senior notes assumed from the acquisition of
Alliant Capital (about $120 million as of Sept. 30, 2022), as well
as add $85 million of cash to the balance sheet. Under the revised
credit agreement, WD may incur an additional $150 million revolving
credit facility, which could further pressure the term loan
recovery rating and issue rating.
"The issuer credit rating affirmation reflects our expectation that
the transaction will be leverage neutral because any excess
proceeds will be applied to the company's cash balance and netted
from debt. We expect WD to reduce debt leverage below 2.0x in 2023.
For the 12 months ended Sept. 30, 2022, the company's net debt to
adjusted EBITDA was 2.3x.
"The stable outlook indicates our expectation that over the next 12
months, WD will be able to reduce net debt to EBITDA to below 2.0x
despite challenging operating conditions. We also expect debt to
tangible equity to remain below 2.0x and the company to maintain
sufficient liquidity to meet operational needs.
"We could lower the ratings within the next 12 months if we expect
WD's operating performance to further weaken or if we expect debt
to EBITDA to remain above 2.0x and debt to tangible equity to
remain around 2.0x for a sustained period. This could occur if the
company's earnings are weaker than we expect, share repurchases
increase, or the company does not allocate sufficient cash flow for
debt reduction. It could also occur if the company pursues another
debt-funded acquisition prior to demonstrating an extended track
record of accretive performance following its recent deals.
"An upgrade is unlikely over the next 12 months. Over time, we
could raise the ratings if WD's exposure to the Fannie Mae
Delegated Underwriting & Servicing risk-sharing program declines."
ZEOLI-BROWN LLC: Court OKs Final Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy COurt for the Eastern District of Michigan,
Southern Division, authorized Zeoli-Brown LLC to use $54,190 in
cash collateral on a final basis in accordance with its agreement
with Kapitus Servicing, Inc. as agent of Kapitus LLC.
The Debtor requires funds to pay expenses in connection with
maintaining operations, including purchasing inventory, satisfying
taxes, payroll, and paying utilities.
The Debtor borrowed $583,600 based on a Promissory Note date
September 14, 2018, which Note was modified pursuant to a Change in
Terms Agreement dated February 14, 2019 (Note 1). The Debtor
borrowed $50,000 pursuant to a Promissory Note dated October 11,
2018 (Note 2), which Note was modified pursuant to a Change in
Terms Agreement dated February 14, 2019.
Note 2 is a restatement, renewal of a prior promissory note in the
amount of $25,000 executed on March 21, 2019. As of October 12,
2022, the unpaid balance of Note 1 was $562,345. As of October 12,
2022, the unpaid balance on Note 2 was $52,786.
The Debtor executed two security agreements to secure its debt to
the Lender. The Security Agreements are dated March 21, 2018, and
September 14, 2018. The Security Agreements grant a security
interest to the Lender an assignment, in all of its assets and all
personal property.
The Lender perfected its security interest in the Collateral by
filing a UCC-1 Financing Statement.
The Debtor also received financing from Kapitus pursuant to a
Forward Purchase Agreements, Security Agreements and Guaranties
dated February 15, 2022 and May 23, 2022 pursuant to which Kapitus
purchased the future receivables of the Debtor. As of the date of
the Petition and pursuant to the proof of claim filed by Kapitus
(Proof of Claim No. 1), Kapitus is owed $71,189.
As adequate protection, the Lender and Kapitus will receive
replacement liens in the Debtor's post-petition assets to the same
extent and with the same priority that they have by virtue of the
pre-petition perfected security interests as of the Petition Date.
The Debtor's permission to use cash collateral will terminate upon
the occurrence of any of the following:
(a) the Debtor's failure to abide by any of the terms and
conditions contained in this Order, any Debtor-in-Possession order,
or any other Court order;
(b) an order being entered dismissing the case or converting
it to a case under Chapter 7 of the Bankruptcy Code, appointing
Trustee to perform any duties of the Debtor, or terminating the
authority of the Debtor to conduct business; or
(c) the Debtor's cessation of operations for any reason.
As adequate protection, the Lender and Kapitus are granted a
perfected security interest and replacement liens in the Debtor's
post-petition assets (except Chapter 5 Causes of Action) to the
same extent and with the same priority as their respective
pre-petition security interest(s).
All Indebtedness for adequate protection due to the Lender and
Kapitus will have priority over any and all costs and expenses of
administration or other priority claims in this Chapter 11
proceeding.
As additional adequate protection of the Lender's interests, the
Debtor will pay the Lender $4,000 a month representing interest on
Note 1 and $365 a month representing interest at the present rate
of interest on Note 2. The interest rate will adjust January 2023.
As such the interest payment on Note 2 will adjust in January 2023.
The first payment will be due November 15, 2022, with subsequent
monthly payments beginning December 2022, due on the 15th day of
the month.
As additional adequate protection, the Debtor will pay Kapitus $250
a month. The first payment was set for November 15, 2022, with
subsequent monthly payments beginning December 2022, due on the
15th day of the month.
A copy of the order is available at https://bit.ly/3BuulPS from
PacerMonitor.com.
About Zeoli-Brown LLC
Zeoli-Brown, LLC -- https://ZeolisItalian.com -- operates the
Italian restaurant Zeoli's Modern Italian in Clawson, Mich.
Zeoli-Brown filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Mich. Case No.
22-48133) on Oct. 18, 2022, with $123,998 in assets and $1.15
million in liabilities. Mark H. Shapiro has been appointed as
Subchapter V trustee.
Judge Maria L. Oxholm oversees the case.
George E. Jacobs, Esq., at Bankruptcy Law Office and McNeil &
Associates, P.C. serve as the Debtor's legal counsel and
accountant, respectively.
[*] Commercial Chapter 11 Bankruptcies Rose 74% in November 2022
----------------------------------------------------------------
ABL Advisor reports that commercial chapter 11 filings increased 74
percent to 345 in November 2022 from the 198 filings recorded in
November 2021, according to data provided by Epiq Bankruptcy, the
leading provider of U.S. bankruptcy filing data.
The November 2022 commercial chapter 11 filing total was lifted by
the more than 100 cases related to the chapter 11 filing on
November 11 by crypto exchange FTX Trading, Ltd. Total commercial
filings increased 17 percent to 1,848 in November over 1,586 total
filings in November 2021. Subchapter V small business filings
increased 38 percent to 117 in November 2022 from 85 filings in
November 2021.
Total U.S. bankruptcy filings in November 2022 were 31,178, up six
percent from 29,335 total filings in November 2021. Overall
individual filings also increased six percent in November 2022, as
29,330 filings were up over 27,749 individual filings recorded in
November 2021. While still below pre-pandemic levels, individual
chapter 13 filings continued to increase in November, as 12,862
filings were up 25 percent over the November 2021 total of 10,327.
"Despite the month-to-month reduction in filings nationally, 13
states still had double-digit month-over-month increases in the
percentage of total commercial filings and seven states had
double-digit increases in individual filings," said Gregg Morin,
Vice President of Business Development and Revenue for Epiq
Bankruptcy. "Even though more than 100 cases were influenced by a
single crypto bankruptcy case, there will always be regional
fluctuations, both higher and lower."
States with the highest percentage increases in commercial filings
included DE, ID, NE, AL, SD, MN, MS, OK, MI, IN, NC, KS and NJ.
States with the most individual filings percentage increases were
AK, WV, SD, OR, KS, DE and ND.
"Rising debt loads, increasing interest rates and inflationary
pressures are presenting families and businesses with difficult
economic challenges to navigate," said ABI Executive Director Amy
Quackenboss. "Bankruptcy provides a lifeline to financially
struggling households and businesses during uncertain economic
times."
Almost all filing chapters in November registered a decrease
compared to October's figures. November's total bankruptcy filings
represented a five percent decrease when compared to the 32,696
total filings recorded the previous month. Total individual filings
for November represented a five percent decrease from the October
2022 individual filing total of 30,792. Individual chapter 13
filings also registered a six percent decrease from October's
individual chapter 13 total of 13,619. The commercial filing total
represented a three percent decrease from the October 2022
commercial filing total of 1,904. Conversely, commercial chapter 11
filings registered a 13 percent increase from the 305 filings the
previous month due in large part to the related cases of the FTX
filing. Subchapter V elections within chapter 11 decreased 11
percent from the 132 filed in October 2022.
*********
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 ***