/raid1/www/Hosts/bankrupt/TCR_Public/230522.mbx
T R O U B L E D C O M P A N Y R E P O R T E R
Monday, May 22, 2023, Vol. 27, No. 141
Headlines
21ST CENTURY: Case Summary & 11 Unsecured Creditors
244/246 HOLDCO: Voluntary Chapter 11 Case Summary
246-18 REALTY: Voluntary Chapter 11 Case Summary
ACASTI PHARMA: Appoints 3 New Execs, Fires CFO and COOs
AGEX THERAPEUTICS: Incurs $3.3 Million Net Loss in First Quarter
AIR METHODS: $1.25B Bank Debt Trades at 49% Discount
ALIERA COMPANIES: Unsecured Medical Claims to Recover 1% to 5%
AMADEUS TRUST: Case Summary & 10 Unsecured Creditors
AMERICAN AXLE: Egan-Jones Retains B- Senior Unsecured Ratings
AMERICAN LAND: Court OKs Interim Cash Collateral Access
AMERICAN MILLENNIUM: AM Best Cuts Fin. Strength Rating to D(Poor)
AMERICANN INC: Posts $87K Net Income in Second Quarter
ASHFORD HOSPITALITY: Egan-Jones Retains CCC+ Sr. Unsecured Ratings
AT HOME GROUP: $600M Bank Debt Trades at 33% Discount
ATH SPORTS: Seeks Cash Collateral Access
AUDACY CAPITAL: $770M Bank Debt Trades at 54% Discount
AVENIR MEMORY: Court Okays Appointment of Patient Care Ombudsman
AVENIR MEMORY: U.S. Trustee Seeks PCO Appointment
AYTU BIOPHARMA: Incurs $7.2 Million Net Loss in Third Quarter
BASIC WATER: Seeks to Extend Plan Exclusivity to September 6
BEVERLY COMMUNITY: U.S. Trustee Appoints 2 New Committee Members
BEVERLY COMMUNITY: U.S. Trustee Appoints Tamar Terzian as PCO
BRIDGE COMMUNICATIONS: Seeks to Hire Money Equations as Accountant
CBL & ASSOCIATES: S&P Alters Outlook to Negative, Affirms 'B' ICR
CENTRALIA APARTMENTS: Case Summary & 20 Top Unsecured Creditors
CERTIFIED 360: Seeks to Hire Mickler & Mickler as Legal Counsel
CHECKERS HOLDINGS: $192.5M Bank Debt Trades at 53% Discount
CLAUSEN OYSTERS: Case Summary & Two Unsecured Creditors
COMMUNITY HOME: Trustee & Creditors File Liquidating Plan
COX INDUSTRIAL: Court OKs Interim Cash Collateral Access
CPC ACQUISITION: $225M Bank Debt Trades at 56% Discount
CROWN FINANCE: $650M Bank Debt Trades at 85% Discount
CURO GROUP: S&P Downgrades ICR to 'SD' on Distressed Debt Exchange
CYXTERA DC: $100M Bank Debt Trades at 39% Discount
CYXTERA DC: $815M Bank Debt Trades at 39% Discount
DEAN ST BROOKLYN: Rental Income to Fund Plan Payments
DELUXE CORP: Egan-Jones Retains B Senior Unsecured Ratings
DET MEDICAL: PCO Joseph Tomaino Submits First Report
DGA HOLDINGS: Seeks to Hire Lee Legal as Bankruptcy Counsel
DIOCESE OF ALBANY: Taps Bond Schoeneck & King as Special Counsel
DIV005 LLC: Ongoing Operations & Trust Proceeds to Fund Plan
ELDAN LLC: Continued Operations to Fund Plan Payments
ENVISION HEALTHCARE: $1B Bank Debt Trades at 91% Discount
ERBO PROPERTIES: Unsecureds Will Get 100% of Claims in Sale Plan
ESCO LTD: Committee Seeks to Hire Cole Schotz as Local Counsel
ESCO LTD: Committee Seeks to Hire Kelley Drye & Warren as Counsel
ESCO LTD: Committee Taps Berkeley Research as Financial Advisor
ESSY QUALITY: Court OKs Interim Cash Collateral Access
EVOKE PHARMA: Five Proposals Passed at Annual Meeting
EXACTECH INC: $235M Bank Debt Trades at 46% Discount
EYECARE PARTNERS: $300M Bank Debt Trades at 27% Discount
EYECARE PARTNERS: $440M Bank Debt Trades at 24% Discount
EYECARE PARTNERS: $750M Bank Debt Trades at 22% Discount
FAIRPORT BAPTIST: PCO Says Patient Care Remains Stable
FARADAY FUTURE: Posts $6.5 Million Net Income in First Quarter
FILTRATION GROUP: Moody's Rates New Secured Term Loans 'B3'
FIRST QUANTUM: Fitch Gives B+(EXP) Rating on New $1BB Unsec. Notes
FMC TECHNOLOGIES: Egan-Jones Retains B Senior Unsecured Ratings
FOREST CITY: $1.24B Bank Debt Trades at 21% Discount
FRANKLIN UNIVERSAL: Fitch Hikes Rating on Secured Notes From 'D'
GLOBAL FOOD: EUR245M Bank Debt Trades at 16% Discount
HALLMARK FINANCIAL: AM Best Cuts LT Issuer Rating to ccc-(Weak)
HEALTHCHANNELS INTERMEDIATE: S&P Lowers ICR to 'CCC', Outlook Neg.
HELIUS MEDICAL: Incurs $2.5 Million Net Loss in First Quarter
HOME POINT: Fitch Affirms 'B-' IDR, On Watch Positive
IAMGOLD CORP: Fitch Affirms 'B-' Issuer Default Rating
IMERYS TALC: Seeks to Hire Ramboll US as Environmental Advisor
INDIAN CANYON: Taps Fiore Racobs & Powers as Special Counsel
INTEGRATED: Equity Holders Tap McCarter & English as Counsel
INTERPACE BIOSCIENCES: Posts $351K Net Income in First Quarter
INW MANUFACTURING: $340M Bank Debt Trades at 21% Discount
JOURNEY PERSONAL: Moody's Alters Outlook on 'Caa2' CFR to Positive
KARAFIN SCHOOL: Wins Cash Collateral Access Thru May 30
KINGSTONE INSURANCE: AM Best Cuts Fin. Strength Rating to B-(Fair)
KLX ENERGY: Posts $9.4 Million Net Income in First Quarter
KRONOS WORLDWIDE: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
LEGACY AT WILLOW BEND: Fitch Affirms 'BB' IDR, Outlook Neg.
LEGACY CARES: U.S. Trustee Appoints Creditors' Committee
MAGENTA BUYER: $750M Bank Debt Trades at 29% Discount
MATRIX PARENT: $160M Bank Debt Trades at 47% Discount
MONEYGRAM INTERNATIONAL: S&P Rates New $400MM Secured Notes 'B'
MONITRONICS INTERNATIONAL: Unsecureds Will Get 100% in Plan
MORGUARD CORPORATION: DBRS Confirms BB(high) Issuer Rating
MOUNTAIN EXPRESS: Committee Taps McDermott Will & Emery as Counsel
MOUNTAIN EXPRESS: Committee Taps Province LLC as Financial Advisor
MUSCLEPHARM CORP: Taps Additon as Special IP Counsel
NEXERA MEDICAL: Bid to Use Cash Collateral Denied as Moot
NIKOFAM INC: Seeks to Hire Madoff & Khoury as Bankruptcy Counsel
NORDSTROM INC: Egan-Jones Retains B+ Senior Unsecured Ratings
NORRIS VENTURES: Seeks to Hire Thompson Law Group as Legal Counsel
NOVABAY PHARMACEUTICALS: Incurs $1.7M Net Loss in First Quarter
NOVUSON SURGICAL: Court OKs Interim Cash Collateral Access
OPULENT VACATIONS: Has Deal on Cash Collateral Access
OUTPUT SERVICES: $180.3M Bank Debt Trades at 57% Discount
OUTPUT SERVICES: $369.8M Bank Debt Trades at 57% Discount
PALMS GOLF CLUB: Case Summary & 20 Largest Unsecured Creditors
PECF USS INTERMEDIATE: $2B Bank Debt Trades at 23% Discount
PEDIATRIC ASSOCIATES: Moody's Rates New $125MM 1st Lien Loan 'B2'
PETES AUTO SALES: Hires Grafstein & Arcaro as Bankruptcy Counsel
PIERLO INC: Case Summary & Six Unsecured Creditors
PORTER'S PENINSULA: Case Summary & Three Unsecured Creditors
PROJECT LEOPARD: S&P Downgrades ICR to 'B-', Outlook Stable
PROTECH FIRE: Case Summary & 20 Largest Unsecured Creditors
PROVECTUS BIOPHARMACEUTICALS: Incurs $827K Net Loss in 1st Quarter
RACKSPACE TECHNOLOGY: $2.30B Bank Debt Trades at 61% Discount
RESCOM LTD: Court OKs Interim Cash Collateral Access
RESEARCH NOW: $250M Bank Debt Trades at 48% Discount
REVERE POWER: $445M Bank Debt Trades at 26% Discount
REVERE POWER: $70M Bank Debt Trades at 27% Discount
RICE ENTERPRISES: Seeks to Hire Hardin Thompson as Special Counsel
SANUWAVE HEALTH: Incurs $13.1 Million Net Loss in First Quarter
SERTA SIMMONS: $851M Bank Debt Trades at 44% Discount
SERTA SIMMONS: Fine-Tunes Plan Documents
SINCLAIR TELEVISION: $750M Bank Debt Trades at 19% Discount
SIO2 MEDICAL: Unsecured Creditors to Recover Up to 100% in Plan
SKILLZ INC: Incurs $35.6 Million Net Loss in First Quarter
SNC-LAVALIN: DBRS Confirms BB(high) Issuer and Sr. Debt Rating
SOUND INPATIENT: $610M Bank Debt Trades at 35% Discount
SPECTRUM BRANDS: Fitch Alters Outlook on 'BB' IDR to Negative
TALCOTT FINANCIAL: S&P Assigns 'BB+' Long-Term ICR, Outlook Stable
TENNISWOOD INC: Case Summary & 20 Largest Unsecured Creditors
TOSCA SERVICES: $626.5M Bank Debt Trades at 29% Discount
TRIBE BUYER: $397M Bank Debt Trades at 38% Discount
US RENAL CARE: $225M Bank Debt Trades at 43% Discount
US RENAL: $1.60B Bank Debt Trades at 43% Discount
US TELEPACIFIC: S&P Downgrades ICR to 'CCC-', Outlook Negative
VENTURA GLOBAL: Fitch Assigns FirstTime 'B' IDR, Outlook Stable
VENTURE GLOBAL: Moody's Assigns B1 CFR & Rates New $3.5BB Notes B1
VIKING CRUISES: S&P Ups ICR to 'B' on Favorable Booking Trends
VISION SOLUTIONS: $445M Bank Debt Trades at 18% Discount
VITAL PHARMACEUTICALS: Exclusivity Period Extended to August 4
VIVO TECHNOLOGIES: Has Deal on Cash Collateral Access
VTV THERAPEUTICS: Incurs $4.5 Million Net Loss in First Quarter
VYANT BIO: Signs Consulting Agreement With President
WHEEL PROS: $1.18B Bank Debt Trades at 32% Discount
WINESTEAD LLC: Seeks to Extend Plan Exclusivity to September 4
XPLORNET COMMUNICATIONS: $200M Bank Debt Trades at 41% Discount
YC RIVERGOLD: Wins Interim Cash Collateral Access
Z NEWS SERVICE: Gets OK to Hire Rosner Law Group as Counsel
ZAYO GROUP: $4.96B Bank Debt Trades at 20% Discount
ZAYO GROUP: $750M Bank Debt Trades at 18% Discount
[*] Corbin Group to Auction Upper East Side Apartments on June 15
[^] BOND PRICING: For the Week from May 15 to 19, 2023
*********
21ST CENTURY: Case Summary & 11 Unsecured Creditors
---------------------------------------------------
Debtor: 21st Century Communities, Inc.
276 Seven Dwarfs Road
Las Vegas, NV 89124
Business Description: The Debtor is engaged in activities related
to real estate.
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
District of Nevada
Case No.: 23-12047
Debtor's Counsel: Matthew L. Johnson, Esq.
JOHNSON & GUBLER, P.C.
Lakes Business Park
8831 W Sahara Ave
Las Vegas, NV 89117-5865
Tel: (702) 471-0065
Fax: (702) 471-0075
Email: mjohnson@mjohnsonlaw.com
Total Assets: $3,608,738
Total Liabilities: $1,448,631
The petition was signed by Barry Cohen as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 11 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/5DXOZVA/21ST_CENTURY_COMMUNITIES_INC__nvbke-23-12047__0001.0.pdf?mcid=tGE4TAMA
244/246 HOLDCO: Voluntary Chapter 11 Case Summary
-------------------------------------------------
Debtor: 244/246 Holdco LLC
42-14 Astoria Blvd
Astoria, NY 11103
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 23-10797
Judge: Hon. Philip Bentley
Debtor's Counsel: Clifford A. Katz, Esq.
PLATZER, SWERGOLD, GOLDBERG, KATZ & JASLOW, LLP
475 Park Avenue South
18th Floor
New York, NY 10016
Tel: 212-593-3000
Email: ckatz@platzerlaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Joseph Nabavi, authorized signatory for
244-246 Members LLC, managing member.
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/U2EYJBQ/244246_Holdco_LLC__nysbke-23-10797__0001.0.pdf?mcid=tGE4TAMA
246-18 REALTY: Voluntary Chapter 11 Case Summary
------------------------------------------------
Debtor: 246-18 Realty LLC
246 West 18th Street
New York, NY 10110
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
Southern District of New York
Case No.: 23-10796
Judge: Hon. Philip Bentley
Debtor's Counsel: Clifford A. Katz, Esq.
PLATZER, SWERGOLD, GOLDBERG, KATZ & JASLOW, LLP
475 Park Avenue South
18th Floor
New York, NY 10016
Tel: 212-593-3000
Email: ckatz@platzerlaw.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $10 million to $50 million
The petition was signed by Joseph Nabavi, authorized signatory for
244,246 Holdco LLC, managing member.
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/UURH2DY/246-18_Realty_LLC__nysbke-23-10796__0001.0.pdf?mcid=tGE4TAMA
ACASTI PHARMA: Appoints 3 New Execs, Fires CFO and COOs
-------------------------------------------------------
Acasti Pharma Inc. appointed Dr. R. Loch Macdonald, MD, PhD, as
chief medical officer, effective March 8, 2023. Dr. Macdonald, 61,
is a practicing neurosurgeon-scientist and respected authority in
subarachnoid hemorrage. Dr. Macdonald acted as Professor,
Department of Surgery, Division of Neurosurgery at the University
of Toronto from January 2007 until December 2019, and was Head,
Division of Neurosurgery, St. Michael's Hospital, University of
Toronto from January 2007 until December 2015. He was Professor,
Department of Neuorological Surgery, Barrow Neurological Surgery,
Barrow Neurological Instituyte, Phoenix, Arizona, from April 2018
until August 2018; Fellow, Department of Neurosurgery, University
of Illinois Hospitals in Chicago, Illinois from December 2018 until
June 2019; Clinical Professor, Department of Neurological Surgery,
University of California San Franciso Fresno, in Fresno, California
from July 2019 until September 2021; and from October 2021 to the
present has been Neurosurgeon, Community Physicians Group,
Community Neurosciences Institute, Community Regional Medical
Center and Medical Director of Neurosciences Research, Community
Health Partners. Dr Macdonald was also a founder of Edge
Therapeutics, Inc. in 2009, where he was a member of the board of
directors between 2009 and 2018 and was chief scientific officer
between 2011 and 2018. Dr. Macdonald completed his medical degree
at the University of British Columbia, Vancouver, British Columbia
and his PhD in Experimental Surgery at the University of Alberta in
Edmonton, Alberta. He completed his Neurosurgery residency at the
University of Toronto.
On May 8, 2023, the Company appointed Carrie D'Andrea as its VP
Clinical Operations, effective immediately. Ms. D'Andrea, 51, is a
highly experienced professional with 25 years of experience in the
pharmaceutical and biotechnology industry who has built and led the
planning, implementation, management, and execution of global Phase
2 and Phase 3 trials for a drug candidate for subarachnoid
hemorrhage. Ms. D'Andrea was the Vice President of Clinical
Operations for Edge Therapeutics Inc. from October 2014 until March
2019 and for EryDel SpA from October 2020 until April 2021. Ms.
D'Andrea received her master's degree in Pharmaceutical Quality and
Regulatory Affairs from Temple University and teaches Clinical
Trial Design and Operations at Rutgers University in the Master of
Business and Science Program.
On May 8, 2023, the Company appointed Amresh Kumar, PhD, as its VP
of Program Management, effective May 15, 2023. Mr. Kumar, 43, is
an experienced drug development, CMC, and program management expert
supporting investigational and marketed products for rare diseases
and neurology. Mr. Kumar is the former product leader of GTX-104
while at Grace Therapeutics Inc. (which was acquired by the Company
in August 2021). Mr. Kumar acted as the Sr. Director of Program
Management at Foresee Pharmaceuticals Inc. from April 2022 until
May 2023 and as Program Leader and Associate Director - R&D at
Grace Therapeutics Inc. between March 2015 and January 2022. Mr.
Kumar received a PhD in Pharmaceutical Science from Sunrise
University, India, focusing on complex injectable drug delivery
systems of highly soluable oncology drugs. He has published many
research articles and has more than 10 granted patents and many
patent applications worldwide to his credit.
On May 8, 2023, the Company terminated the employment of Brian
Ford, chief financial officer; Pierre Lemieux, chief operating
officer (Canada); and George Kottayil, Chief Operating Officer
(US). Mr. Ford will remain as interim chief financial officer of
the Company until June 30, 2023, subject to potential extension of
that term by the Company. Under the terms of their employment
arrangements, Mr. Ford, Mr. Lemieux and Mr. Kottayil will receive
severance payments.
On May 8, 2023, the Company announced the successful submission to
the FDA of GTX-104's full protocol of its pivotal Phase 3 Safety
Study and implementation of a strategic realignment plan to
maximize shareholder value.
The realignment follows a comprehensive strategic review of the
Company by Prashant Kohli, its recently appointed chief executive
officer, and its Board of Directors.
Key strategies being implemented are:
1. Prioritizing resources to GTX-104. The Company has submitted
the full pivotal Phase 3 Safety Study protocol with all supporting
documentation. Pending final feedback and approval from the FDA,
the first patient, first dose for the pivotal Phase 3 Safety Study
is expected in calendar Q4 2023.
2. Strategic transformation of the Company's operating model to an
agile biopharma reflecting its complete focus on GTX-104. In
alignment with the operating model, the Company has brought on a
highly experienced new management team with deep subject matter
knowledge and direct, hands-on clinical trial experience in aSAH.
3. Significant extension of the Company's cash runway expected to
be sufficient to fund the Company through calendar Q2 2025,
facilitating achievement of critical value inflection milestones,
including a potential New Drug Application (NDA) filing for
GTX-104.
4. Evaluation of strategic alternatives to maximize value of
de-prioritized pipeline assets (GTX-102 and GTX-101) including
out-licensing or sale.
In connection with the transformation of the operating model, the
Company has moved to appoint the following industry experts to its
senior management team:
* Dr. R. Loch Macdonald, MD, PhD, as chief medical officer. A
world-renowned practicing neurosurgeon-scientist and respected
authority in SAH, Dr. Macdonald is the former founder of a
clinical-stage biotechnology company focused on subarachnoid
hemorrhage.
* Carrie D'Andrea, as VP Clinical Operations. Ms. D'Andrea is a
highly experienced professional who has built and led the
planning, implementation, management, and execution of global
Phase 2 and Phase 3 trials for a drug candidate for
subarachnoid
hemorrhage.
* Amresh Kumar, PhD, as VP Program Management. Mr. Kumar is an
experienced drug development, CMC, and program management
expert. Amresh is the former product leader of GTX-104 while
at
Grace Therapeutics (which was acquired by the Company).
As a result of this strategic realignment, the Company is over time
discontinuing its operations in Canada, and has proceeded to lay
off substantially all its workforce, allowing the Company's new
management team to rebuild a leaner organization in the United
States. All of the Company's finance team will remain in their
current role for a transition period until at least the end June
2023.
About Acasti Pharma
Acasti Pharma Inc. -- http://www.acastipharma.com-- is a
late-stage specialty pharma company with drug delivery capability
and technologies addressing rare and orphan diseases. Acasti's
novel drug delivery technologies have the potential to improve the
performance of currently marketed drugs by achieving faster onset
of action, enhanced efficacy, reduced side effects, and more
convenient drug delivery -- all which could help to increase
treatment compliance and improve patient outcomes.
Acasti Pharma reported a net loss and comprehensive loss of $9.82
million for the year ended March 31, 2022, a net loss and
comprehensive loss of $19.68 million for the year ended March 31,
2021, and a net loss and comprehensive loss of $25.51 million for
the year ended March 31, 2020. As of Dec. 31, 2022, the Company
had $116.80 million in total assets, $20.08 million in total
liabilities, and $96.72 million in total shareholders' equity.
AGEX THERAPEUTICS: Incurs $3.3 Million Net Loss in First Quarter
----------------------------------------------------------------
AgeX Therapeutics, Inc. has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $3.28 million on $10,000 of revenues for the three months ended
March 31, 2023, compared to a net loss of $2.71 million on $5,000
of revenues for the three months ended March 31, 2022.
As of March 31, 2023, the Company had $12.53 million in total
assets, $32.54 million in total liabilities, and a total
stockholders' deficit of $20 million.
AgeX said, "We have incurred operating losses and negative cash
flows since inception and had an accumulated deficit of $119.5
million as of March 31, 2023. We expect to continue to incur
operating losses and negative cash flows.
"Based on a strategic review of its operations, giving
consideration to the status of its product development programs,
human resources, capital needs and resources, and current
conditions in the capital markets, AgeX's board of directors and
management have adopted operating plans and budgets to extend the
period over which AgeX can continue its operations with its
available cash resources. Notwithstanding those operating plans and
budgets, based on AgeX's most recent projected cash flows AgeX
believes that its cash and cash equivalents of $0.3 million as of
March 31, 2023 plus the loan facilities provided by Juvenescence to
advance up to an additional $4 million to AgeX as of May 9,
2023...and the proceeds AgeX may receive from the sale of
additional shares of its common stock in "at-the-market"
transactions through a Sales Agreement with Chardan Capital, LLC as
a sales agent, would not be sufficient to satisfy AgeX's
anticipated operating and other funding requirements for the next
twelve months from the issuance of these condensed consolidated
interim financial statements. These conditions raise substantial
doubt about AgeX's ability to continue as a going concern. AgeX
will need to obtain substantial additional funding in connection
with its continuing operations."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1708599/000149315223016642/form10-q.htm
About Agex Therapeutics
Headquartered in Alameda, California, AgeX Therapeutics, Inc. is a
biotechnology company focused on the development and
commercialization of novel therapeutics targeting human aging and
degenerative diseases.
Agex Therapeutics reported a net loss of $10.52 million in 2022, a
net loss of $8.68 million in 2021, a net loss of $10.97 million for
the year ended Dec. 31, 2020, and a net loss of $12.38 million for
the year ended Dec. 31, 2019.
San Francisco, California-based WithumSmith+Brown, PC, the
Company's auditor since 2017, issued a "going concern"
qualification in its report dated March 31, 2023, citing that the
Company has had recurring losses and negative operating cash flows
since inception, an accumulated deficit at Dec. 31, 2022, and
insufficient cash and cash equivalents and loan proceeds at Dec.
31, 2022 to fund operations for twelve months from the date of
issuance. All of these matters raise substantial doubt about the
Company's ability to continue as a going concern.
AIR METHODS: $1.25B Bank Debt Trades at 49% Discount
----------------------------------------------------
Participations in a syndicated loan under which Air Methods Corp is
a borrower were trading in the secondary market around 51.3
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $1.25 billion facility is a Term loan that is scheduled to
mature on April 21, 2024. About $1.18 billion of the loan is
withdrawn and outstanding.
Air Methods Corporation provides ambulance services. The Company
offers emergency medical services by air transport.
ALIERA COMPANIES: Unsecured Medical Claims to Recover 1% to 5%
--------------------------------------------------------------
The Aliera Companies, Inc. d/b/a Aliera Healthcare, Inc., et al.,
and the Official Committee of Unsecured Creditors filed with the
U.S. Bankruptcy Court for the District of Delaware a Combined
Disclosure Statement and Plan of Liquidation dated May 15, 2023.
Aliera was a health care organization marketing health care
solutions to customers that were located in various states. Prior
to 2016, Aliera (through a predecessor) developed and sold closed
network capitated Direct Primary Care Medical Home ("DPCMH") health
programs.
The Debtors estates currently have approximately $5,000,000 in cash
on hand generated primarily from income tax refunds received during
the Chapter 11 Cases. The Debtors' other remaining assets consist
primarily of Causes of Action and Claims, including, without
limitation, Claims against (a) former insiders and entities owned
or controlled by them, (b) persons and entities with whom the
Debtors had contracts and/or did business, and (c) professionals
who performed pre-petition services for the Debtors.
The Plan constitutes a liquidating chapter 11 plan for the Debtors.
The Plan provides for the Debtors' assets already liquidated or to
be liquidated over time and for the proceeds to be distributed to
Holders of Allowed Claims in accordance with the terms of the Plan.
Except as otherwise provided by order of the Bankruptcy Court,
Distributions will occur on the Effective Date or as soon
thereafter as is practicable and at various intervals thereafter.
The Plan provides for the establishment of the Trust which shall,
as provided for in the Plan and the Trust Agreement, be the means
to effect such liquidation and Distributions.
The Plan incorporates the Unsecured Creditor Settlement negotiated
by and among the Debtors, the Committee, the Sharity Trustee, and
Unity Class Representatives, on behalf of the Unity Members. It is
contemplated that the Unsecured Settlement shall be approved in
connection with the Confirmation of the Plan. Among other things,
it provides for distributions from the Trust to Holders of Class 3
Unsecured Trade Claims and Class 4 Unsecured Medical Claims under
the Plan pursuant to a distribution waterfall negotiated by the
parties.
The Unsecured Creditor Settlement fixes and allows the Class 4
Unsecured Medical Claims, comprised of the Sharity Trust Claim and
the Unity Member Class Claim, in a total amount of $660,667,598.
The total amount of Allowed Unsecured Trade Claims in Class 3 under
the Plan is not fixed, but the Plan Proponents estimate these will
range from $10,000,000 to $15,000,000. The proposed waterfall
distribution provides that the first $2,500,000 in Available Cash
will be distributed to Class 3, and the next $6,000,000 in
Available Cash will be distributed to Class 4.
Class 3 consists of Unsecured Trade Claims. Will receive a pro rata
share of UTC Cash available after payment of or reserve for Allowed
Claims on the later of: (a) the date or dates determined by the
Liquidating Trustee, to the extent there is Cash available for
distribution in the judgment of the Liquidating Trustee, having due
regard for the anticipated and actual expenses, and the likelihood
and timing, of the process of liquidating or disposing of the
Assets; and (b) the date on which such Claim becomes Allowed. The
amount of claim in this Class total $10,000,000 to $15,000,000.
This Class will receive a distribution of 15–35% of their allowed
claims.
Class 4 consists of Unsecured Medical Claims. Will receive a pro
rata share of UMC Cash available after payment of or reserve for
Allowed Claims on the later of: (a) the date or dates determined by
the Liquidating Trustee, to the extent there is Cash available for
distribution in the judgment of the Liquidating Trustee, having due
regard for the anticipated and actual expenses, and the likelihood
and timing, of the process of liquidating or disposing of the
Assets; and (b) the date on which such Claim becomes Allowed. The
amount of claim in this Class total $660,667,598. This Class will
receive a distribution of 1-5%% of their allowed claims.
Class 7 consists of Equity Interests. Will receive no distributions
and retain no equity interests.
This Plan will be primarily funded by a combination of the Assets
that are Cash on hand and proceeds from liquidation or other
disposition of non-cash Assets, including Avoidance Actions
Recoveries and General Litigation Claim Recoveries. Certain funding
may also be provided from other Trust Assets.
A full-text copy of the Combined Disclosure Statement and Plan
dated May 15, 2023 is available at https://bit.ly/3MmsO30 from Epiq
Corporate Restructuring, LLC, claims agent.
Counsel for the Debtors:
SCROGGINS & WILLIAMSON, P.C.
J. Robert Williamson
Ashley Reynolds Ray
4401 Northside Parkway
Suite 450
Atlanta, GA 30327
(404) 893-3880
- and –
MONZACK MERSKY AND BROWDER, P.A.
Rachel B. Mersky
1201 Orange Street, Suite 400
Wilmington, DE 19801
T: (302) 656-8162
F: (302) 656-2769
E: rmersky@monlaw.com
Counsel for the Official Committee of Unsecured Creditors:
GREENBERG TRAURIG, LLP
Dennis A. Meloro
222 Delaware Avenue, Suite 1600
Wilmington, DE 19801
T: (302) 661-7000
E: melorod@gtlaw.com
- and –
John D. Elrod
3333 Piedmont Road, NE, Suite 2500
Atlanta, GA 30305
T: (678) 553-2259
F: (678) 553-2269
E: elrodj@gtlaw.com
About Aliera Companies
The Aliera Companies Inc. is focused on providing a full spectrum
of revolutionary options and services to a multitude of industries
that fit every need and budget. The company provides services to
support its subsidiaries which focus on the unique aspects of the
health care industry.
Plaintiffs in a case -- docketed as Hanna Albina and Austin
Willard, individually and on behalf of others similarly situated,
Plaintiffs, v. The Aliera Companies, Inc., Trinity Healthshare,
Inc. and Oneshare Health, LLC Unity Healthshare, LLC, Case No.
20-CV-00496, (E.D. Ky., Dec. 11, 2020) -- filed an involuntary
petition under Chapter 11 of the Bankruptcy Code against Aliera
(Bankr. D. Del. Case No. 21-11548) on Dec. 5, 2021.
Joseph H. Huston, Jr., Esq., of Stevens & Lee, P.C., is the
petitioners and plaintiffs' counsel.
On Dec. 21, 2021, Aliera filed a voluntary Chapter 11 petition
(Bankr. N.D. Ga. Case No. 21-59493), disclosing assets of $1
million to $10 million and liabilities of $500 million to $1
billion. Advevo LLC and three other Aliera affiliates – Ensurian
Agency LLC, Tactic Edge Solutions LLC and USA Benefits &
Administrators LLC -- also filed voluntary Chapter 11 petitions on
Dec. 21, 2021.
On Jan. 25, 2022, the petitioning creditors obtained an order
granting their motion to transfer the voluntary Chapter 11 cases to
the Delaware Bankruptcy Court, which has been overseeing the
liquidation of Aliera's affiliated corporation, Trinity
Healthshare, Inc., now known as Sharity Ministries, Inc.
On Feb. 16, 2022, Judge John T. Dorsey of the Delaware Bankruptcy
Court ordered the consolidation of Aliera's voluntary Chapter 11
proceeding with the involuntary case filed by the petitioning
creditors (with Case No. 21-11548 being the surviving case number)
and terminated the company's voluntary proceeding.
Meanwhile, Judge Dorsey ordered the joint administration of the
involuntary proceeding and the four other voluntary cases filed by
the Aliera affiliates, with Case No. 21-11548 as the lead
bankruptcy case.
The Debtors tapped J. Robert Williamson, Esq., at Scroggins &
Williamson, P.C. and Monzack Mersky and Browder, PA as bankruptcy
counsels; SeatonHill Partners, LP as financial advisor; and Katie
Goodman, managing member of GGG Partners, LLC, as chief liquidation
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 on Feb. 21, 2022. The committee is represented
by Greenberg Traurig, LLP.
AMADEUS TRUST: Case Summary & 10 Unsecured Creditors
----------------------------------------------------
Debtor: The Amadeus Trust under Declaration of Trust of January
24, 2000
7095 Hollywood Blvd., #810
Los Angeles, CA 90002
Business Description: The Debtor is a Single Asset Real Estate (as
defined in 11 U.S.C. Section 101(51B)).
Chapter 11 Petition Date: May 18, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-13086
Debtor's Counsel: Christopher A. Minier, Esq.
GOLDEN GOODRICH LLP
650 Town Center Drive Suite 600
Costa Mesa, CA 92626
Tel: (714) 966-1000
Email: cminier@go2.law
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Gerald Goldstein as trustee.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 10 unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/MKC3U7A/The_Amadeus_Trust_under_Declaration__cacbke-23-13086__0001.0.pdf?mcid=tGE4TAMA
AMERICAN AXLE: Egan-Jones Retains B- Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company on May 5, 2023, maintained its 'B-'
foreign currency and local currency senior unsecured ratings on
debt issued by American Axle & Manufacturing Holdings, Inc. EJR
also withdraws 'B' rating on commercial paper issued by the
Company.
Headquartered in Detroit, Michigan, American Axle & Manufacturing
Holdings, Inc. operates as an automotive supplier of driveline and
drivetrain systems and related components for light trucks, SUVs,
passenger cars, crossover, and commercial vehicles.
AMERICAN LAND: Court OKs Interim Cash Collateral Access
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Ohio,
Western Division, authorized American Land Investments, Ltd. to use
cash collateral on an interim basis.
The Debtor requires the use of cash collateral to continue funding
its necessary business expenses and fund the costs associated with
the administration of the Case.
Prior to the commencement of the Case, Minster Bank was the
Debtor's primary bank. The Debtor's obligations to Minster Bank
were evidenced several Promissory Notes including one dated
September 25, 2006, in the face principal amount of $330,000 and
Promissory Note dated as of October 1, 2009, in the face principal
amount of $50,000.
The loans evidenced by the Senior Secured Loan Documents have been
declared in default. The total principal indebtedness claimed to be
owing to Minster Bank under the Senior Secured Loan Documents, as
of the Petition Date, is approximately $561,866.
As adequate protection, Minster Bank is granted valid, continuing,
binding, enforceable, unavoidable and perfected first priority
replacement liens upon and security interests in all of Debtor's
presently owned, leased, or hereafter acquired property and assets
of the Debtor.
The Debtor will maintain adequate insurance covering Minster Bank's
collateral, including casualty loss, of which insurance Minster
Bank will be an additional named insured as to its interests as set
forth therein.
In addition to the Senior Replacement Liens granted, Minster Bank
is granted administrative expense claims, in the priority of its
respective liens, in the amount by which the adequate protection
afforded above proves to be inadequate, to protect Minster Bank
from any post-petition diminution in value of the Collateral, which
in no event will be greater than the amount of Minster Bank's
claim. This administrative claim will be allowed and have
superpriority over all other costs and expenses of the kind, and
will be payable from and have recourse to all prepetition and
post-petition property of the Debtor and all proceeds thereof.
A final hearing on the matter is set for June 7, 2023 at 9:30 a.m.
A copy of the order is available at https://bit.ly/42Gkwdd from
PacerMonitor.com.
About American Screening, LLC
American Screening, LLC is a distributor of complete rapid drug &
alcohol testing solutions.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. La. Case No. 23-10350) on April 7,
2023. In the petition signed by Ronald Kilgarlin, Jr., managing
member, the Debtor disclosed $9,100,921 in assets and $27,251,799
in liabilities.
Judge Guy R. Humphrey oversees the case.
Kell C. Mercer, Esq., at Kell C. Mercer, PC, represents the Debtor
as legal counsel.
AMERICAN MILLENNIUM: AM Best Cuts Fin. Strength Rating to D(Poor)
-----------------------------------------------------------------
AM Best has removed from under review with developing implications
and downgraded the Financial Strength Rating (FSR) to D (Poor) from
C- (Weak) and the Long-Term Issuer Credit Rating (Long-Term ICR) to
"c" (Poor) from "cc" (Very Weak) of American Millennium Insurance
Company (AMIC) (Bridgewater, NJ), a wholly owned subsidiary of
Citadel Reinsurance Company Limited (Citadel Re) (Hamilton,
Bermuda). The outlook assigned to these Credit Ratings (ratings) is
negative.
Additionally, AM Best has removed from under review with developing
implications and downgraded the FSR to C+ (Marginal) from B (Fair)
and the Long-Term ICR to "b-" (Marginal) from "bb" (Fair) of
Citadel Re. The outlook assigned to these ratings is negative.
Concurrently, AM Best has withdrawn the ratings of AMIC and Citadel
Re as the companies have requested to no longer participate in AM
Best's interactive rating process.
The ratings of AMIC reflect its balance sheet strength, which AM
Best assesses as very weak, as well as its weak operating
performance, limited business profile and marginal enterprise risk
management (ERM).
The ratings of Citadel Re reflect its balance sheet strength, which
AM Best assesses as weak, as well as its marginal operating
performance, limited business profile and marginal ERM.
Prior to these rating actions, AM Best downgraded the ratings of
AMIC and Citadel Re in February 2021, and maintained the under
review with negative implications status, resulting from persistent
underwriting losses that negatively impacted the risk-adjusted
capitalization of both companies. The under review status was
pending due to a planned recapitalization of AMIC and Citadel Re to
raise capital from outside investors.
In August 2021, Citadel Re completed its recapitalization of AMIC
with a $6.2 million cash injection, raising the risk-based capital
ratio to above 300% to the satisfaction of AMIC's regulator, the
Department of Banking and Insurance of New Jersey. However,
management's planned capital raise was not successful, as the
transaction failed to get approval from the Bermuda Monetary
Authority (BMA).
The failed transaction also led to Citadel Re having to return a
portion of its capital to the outside investor and causing Citadel
Re's capital to fall below Bermuda's Solvency Capital Requirement
(SCR); consequently, the BMA ordered Citadel Re to stop writing any
new and renewal business.
The downgrading of Citadel Re's ratings reflects its weakened
balance sheet strength, as well as a lower assessment of its
business profile due to its run-off status. The downgrading of
AMIC's ratings is mainly due to it no longer receiving lift from
Citadel Re, because of Citadel Re's diminished capital position.
The negative outlooks on both entities reflect the uncertainty
surrounding their future business prospects and the challenges
associated with the regulatory and capital requirements imposed on
Citadel Re by the BMA.
AMERICANN INC: Posts $87K Net Income in Second Quarter
------------------------------------------------------
Americann, Inc. has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing net income
of $86,622 on $748,406 of rental income for the three months ended
March 31, 2023, compared to net income of $24,240 on $667,366 of
rental income for the three months ended March 31, 2022.
For the six months ended March 31, 2023, the Company reported net
income of $109,367 on $1.48 million of rental income compared to a
net loss of $508,788 on $911,047 of rental income for the same
period in 2022.
As of March 31, 2023, the Company had $15.28 million in total
assets, $9.37 million in total liabilities, and $5.91 million in
total stockholders' equity.
The Company had an accumulated deficit of $19,649,322 and
$19,758,689 at March 31, 2023 and Sept. 30, 2022, respectively.
Americann said, "The Company is continuing to support the
optimization of operations and generate additional revenues from
its Massachusetts Cannabis Center (MCC). The Company's cash
position and quarterly revenue is currently significant enough to
support the Company's daily operations. The Company is not
obligated to raise additional funds for the expansion of the MCC.
When Management determines expansion opportunities exist the
Company may finance construction with cash from operations, a
sale-lease-back, refinancing and expand existing debt, issuance of
new debt, or sales of equity.
"Management believes that the actions presently being taken to
further implement its business plan and generate additional
revenues provide the opportunity for the Company to continue as a
going concern. While the Company believes in the viability of its
strategy to generate additional revenues and in its ability to
raise additional funds, there can be no assurances to that effect.
The ability of the Company to continue as a going concern is
dependent upon the Company's ability to further implement its
business plan and generate additional revenues."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1508348/000143774923013846/acan20230331_10q.htm
About AmeriCann
Americann, Inc. (OTCQB:ACAN) is a specialized cannabis company that
is developing state-of-the-art product manufacturing and greenhouse
cultivation facilities. Its business plan is based on the
continued growth of the regulated marijuana market in the United
States.
Americann, Inc. reported a net loss of $173,244 for the year ended
Sept. 30, 2022, compared to a net loss of $862,893 for the year
ended Sept. 30, 2021.
Houston, Texas-based MaloneBailey, LLP, the Company's auditor since
2016, issued a "going concern" qualification in its report dated
Dec. 29, 2022, citing that the Company has suffered recurring
losses from operations and has an accumulated deficit that raises
substantial doubt about its ability to continue as a going concern.
ASHFORD HOSPITALITY: Egan-Jones Retains CCC+ Sr. Unsecured Ratings
------------------------------------------------------------------
Egan-Jones Ratings Company on May 5, 2023, maintained its 'CCC+'
foreign currency and local currency senior unsecured ratings on
debt issued by Ashford Hospitality Trust, Inc. EJR also withdraws
'B' rating on commercial paper issued by the Company.
Headquartered in Dallas, Texas, Ashford Hospitality Trust, Inc.
operates as a self-advised real estate investment trust focusing on
the lodging industry.
AT HOME GROUP: $600M Bank Debt Trades at 33% Discount
-----------------------------------------------------
Participations in a syndicated loan under which At Home Group Inc
is a borrower were trading in the secondary market around 67.4
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $600 million facility is a Term loan that is scheduled to
mature on July 23, 2028. The amount is fully drawn and
outstanding.
At Home Group Inc. owns and operates home decor stores. The
Company
offers furniture, home furnishings, wall decor and decorative
accents, rugs, and housewares.
ATH SPORTS: Seeks Cash Collateral Access
----------------------------------------
ATH Sports Nutrition LLC asks the U.S. Bankruptcy Court for the
District of Hawaii for authority to use cash collateral for the
period from June 2023 through August 2023.
The Debtor requires the use of cash collateral to continue
operating its business.
There are two UCC creditors identified in the UCC Report: the Small
Business Administration and SellersFunding.
ATH proposes to provide adequate protection for the use of cash
collateral by providing the Prepetition Secured Lenders with:
a. Adequate Protection Payments to the SBA. The Debtor
proposes to continue to make full debt service payments to the SBA
in the amount of $2,501 per month.
b. Replacement Liens. The Debtor proposes to grant the
Prepetition Secured Creditor replacement liens in the estate's
postpetition assets, and the proceeds thereof, to the same extent
and priority as any lien held by the Prepetition Secured Creditor
in the Pre-Petition Collateral as of the Petition Date, limited to
the amount of Pre-Petition Collateral as of the Petition Date. The
Replacement Liens would thus be granted with the same validity and
priority and to the same extent and as the Prepetition Secured
Creditor's prepetition liens, and would be subject to the same
rights and challenges by or on behalf of ATH. The Replacement Liens
will be valid, perfected and enforceable against the Replacement
Collateral without further filing or recording of any document or
instrument or the taking of any further action.
A copy of the motion is available at https://bit.ly/3BAzci8 from
PacerMonitor.com.
About ATH Sports Nutrition LLC
ATH Sports Nutrition LLC sought protection under Chapter 11 of the
U.S. Bankruptcy Code (Bankr. D. Hawaii Case No. 23-00362) on May
15, 2023. In the petition signed by Stuart Kanaloa Kam, member, the
Debtor disclosed up to $10 million in both assets and liabilities.
Judge Robert J. Faris oversees the case.
Allison A. Ito, Esq., at Choi & Ito, represents the Debtor as legal
counsel.
AUDACY CAPITAL: $770M Bank Debt Trades at 54% Discount
------------------------------------------------------
Participations in a syndicated loan under which Audacy Capital Corp
is a borrower were trading in the secondary market around 45.9
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $770 million facility is a Term loan that is scheduled to
mature on November 17, 2024. About $630.5 million of the loan is
withdrawn and outstanding.
Audacy Capital Corp. owns and operates radio stations. The Company
focuses on sports, news, and music and entertainment. Audacy
Capital produces, co-produces, and co-promotes events across
markets, including concerts, multi-day musical festivals, speaker
series, trade shows, and sports-related events.
AVENIR MEMORY: Court Okays Appointment of Patient Care Ombudsman
----------------------------------------------------------------
Judge Brenda Moody Whinery of the U.S. Bankruptcy Court for the
District of Arizona approved the appointment of Teresa Teeple as
patient care ombudsman for Avenir Memory Care @ Knoxville, LP.
To the best of her knowledge, Ms. Teeple has no connections with
the Debtor, creditors, any other parties in interest, their
respective attorneys and accountants, the U.S. Trustee, and persons
employed in the Office of the U.S. Trustee, except as set forth in
her verified statement.
The patient care ombudsman shall:
* monitor the quality of patient care provided to patients of
the Debtor, to the extent necessary under the circumstances,
including interviewing patients and physicians;
* not later than 60 days after the date of this appointment,
and not less frequently than at 60-day intervals thereafter, report
to the Court after notice to the parties in interest, at a hearing
or in writing, regarding the quality of patient care provided to
patients of the Debtor; and
* if such ombudsman determines that the quality of patient
care provided to patients of the Debtor is declining significantly
or is otherwise being materially compromised, file with the Court a
motion or a written report, with notice to the parties in interest
immediately upon making such determination;
* without special notice to patients have access to and may
review confidential patient records as necessary and appropriate to
discharge her duties and responsibilities under this Order,
provided however, that she protect the confidentiality of such
records as required under non-bankruptcy law and regulations,
including but not limited to the Health Insurance Portability and
Accountability Act of 1996 (Pub. L. 104-191), and any amendments or
implementing regulations ("HIPAA"), and the Health Information
Technology for Economic and Clinical Health Act, which was enacted
as title XIII of division A and title IV of division B of the
American Recovery and Reinvestment Act of 2009 (Pub. L.111-5), and
any amendments or implementing regulations ("HITECH"), including
the Final Omnibus Privacy Regulations in 45 CFR Parts 160 and 164.
* in the interests of judicial economy and to avoid confusing
Debtor's patients, the Ombudsman will not personally serve
individual patients pursuant to Fed. R. Bankr. P. 2015.1(a).
Alternatively, PCO will work with Debtor to post a notice informing
patients of the PCO appointment, duties, and availability. Such
notice will include a statement that PCO reports are available at
the facility, through direct contact with the PCO, and/or through
Debtor's counsel.
A copy of the appointment order is available for free at
https://bit.ly/3MutrJc from PacerMonitor.com.
About Avenir Memory Care @ Knoxville
Avenir Memory Care @ Knoxville, LP operates a nursing care facility
in Scottsdale, Ariz.
Avenir Memory Care @ Knoxville filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz.
Case No. 23-02047) on March 31, 2023, with $10 million to $50
million in both assets and liabilities. David L. Craik, president
and director of the General and Limited Partners, signed the
petition.
Judge Brenda Moody Whinery oversees the case.
Philip R. Rudd, Esq., at Sacks Tierney, P.A. represents the Debtor
as counsel.
AVENIR MEMORY: U.S. Trustee Seeks PCO Appointment
-------------------------------------------------
The U.S. Trustee for Region 14 filed with the U.S. Bankruptcy Court
for the District of Arizona a motion for the appointment of a
patient care ombudsman for Avenir Memory Care @ Fayetteville, LP.
In her motion, the U.S. Trustee argued Fayetteville operates a
health care business and that a patient care ombudsman must be
appointed in its Chapter 11 case.
"[Fayetteville] is engaged primarily in offering to the general
public its facilities and services for the diagnosis or treatment
of injury, deformity or disease, and based on the type of facility
and services provided, is, at the very least, engaged in drug, and
possibly psychiatric, treatment," the U.S. Trustee said.
The motion follows the court's May 3 ruling in Fayetteville's
affiliated case, Avenir Memory Care @ Knoxville, LP (Case No.
23-02047) in which the court appointed a patient care ombudsman
after ruling that Knoxville operates a health care business.
Section 333 directs that a patient care ombudsman be appointed if a
debtor is a health care business unless the court finds that the
appointment of such ombudsman is not necessary for the protection
of patients. The ombudsman monitors the quality of patient care and
represents the interest of the patients of the healthcare debtor.
About Avenir Memory Care @ Fayetteville
Avenir Memory Care @ Fayetteville, LP operates a nursing care
facility in Scottsdale, Ariz.
Avenir Memory Care @ Fayetteville filed its voluntary petition for
relief under Chapter 11 of the Bankruptcy Code (Bankr. D. Ariz.
Case No. 23-02640) on April 25, 2023, with $10 million to $50
million in both assets and liabilities. Judge Brenda Moody Whinery
presides over the case.
Philip R. Rudd, Esq., at Sacks Tierney, P.A. represents the Debtor
as counsel.
AYTU BIOPHARMA: Incurs $7.2 Million Net Loss in Third Quarter
-------------------------------------------------------------
Aytu Biopharma, Inc. has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $7.20 million on $22.73 million of net product revenue for the
three months ended March 31, 2023, compared to a net loss of $53.29
million on $24.20 million of net product revenue for the three
months ended March 31, 2022.
For the nine months ended March 31, 2023, the Company reported a
net loss of $14.59 million on $76.67 million of net product revenue
compared to a net loss of $92.69 million on $69.22 million of net
product revenue for the nine months ended March 31, 2022.
As of March 31, 2023, the Company had $147.22 million in total
assets, $106.30 million in total liabilities, and $40.91 million in
total stockholders' equity.
Aytu said, "As of March 31, 2023, the Company did not have
sufficient working capital to cover its cash needs to fund planned
operations for the twelve months following the filing date of this
Quarterly Report on Form 10-Q, which raises substantial doubt about
the Company's ability to continue as a going concern.
"Management plans to continue to mitigate the conditions that raise
substantial doubt about its ability to continue as a going concern,
primarily by focusing on increasing revenue, reducing expenses
associated with research and development, and raising additional
capital through public or private equity, debt offerings, or
monetizing assets in order to meet its obligations. Management
believes that the Company has access to capital resources, however,
the Company cannot provide any assurance that it will be able to
raise additional capital, monetize assets or obtain new financing
on commercially acceptable terms. If the Company is unable to
secure additional capital, it may be required to curtail its
operations or delay the execution of its business plan.
Alternatively, any efforts by the Company to reduce its expenses
may adversely impact its ability to sustain revenue-generating
activities and continue the suspension of its developmental
programs or otherwise operate its business. As a result, there can
be no assurance that the Company will be successful in implementing
its plans to alleviate this substantial doubt about its ability to
continue as a going concern."
Management Discussion
"Our core Rx segment continues to perform at a high level, with
record total prescriptions written during the quarter," commented
Josh Disbrow, chief executive officer of Aytu BioPharma. "The 32%
growth in total prescriptions is a testament to the strong
execution of our commercial team, coupled with the unique
capabilities of the Aytu RxConnect platform. Importantly, we
believe that the 27% ADHD prescription growth over the same quarter
last year bodes well for the long-term growth and future
profitability of the business. We expect these positive impacts
will be visible once the new pricing and channel effects normalize
and as patients move past their annual prescription deductible
resets, which occur this time each year. We're pleased with the
growth of the prescription segment and are excited to see the
momentum continue."
"We continue the strategic transition we implemented within our
Consumer Health segment as we phase out of the direct mail channel
with a focus on OTC medicines and their e-commerce sales, which
resulted in sales on Amazon increasing 13% compared to the year ago
period. With the launch our C'rcle Health branding initiative
later this year, which we believe will improve our return on ad
spend, we believe we will see future improvement within this
segment as we focus on segment profitability."
"Overall, our Rx segment continues its significant script growth,
and despite the accounting adjustment on our ADHD segment, scripts
are at record levels. Additionally, we are successfully executing
against our various gross margin enhancements strategies, including
the recent progress we have made to finalize the manufacturing of
our ADHD products to a third-party facility. We also recently
announced the partial sublease of our Grand Prairie manufacturing
facility. We still have work to do to fully enhance the benefits
within our Consumer Health segment, but with a keen focus on
improving growth and profitability in both our segments, I believe
we are in position to end fiscal 2023 on a high note,' Disbrow
concluded.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1385818/000155837023009367/aytu-20230331x10q.htm
About Aytu BioPharma
Englewood, Colorado-based Aytu BioPharma, Inc., formerly known as
Aytu BioScience, Inc. -- http://www.aytubio.com-- is a
pharmaceutical company commercializing a portfolio of commercial
prescription therapeutics and consumer health products. The
Company's prescription products include Adzenys XR-ODT
(amphetamine) extended-release orally disintegrating tablets and
Cotempla XR-ODT (methylphenidate) extended-release orally
disintegrating tablets for the treatment of attention deficit
hyperactivity disorder (ADHD), as well as Karbinal ER
(carbinoxamine maleate), an extended-release antihistamine
suspension indicated to treat numerous allergic conditions, and
Poly-Vi-Flor and Tri-Vi-Flor, two complementary fluoride-based
prescription vitamin product lines available in various
formulations for infants and children with fluoride deficiency.
Aytu's consumer health segment markets a range of over-the-counter
medicines, personal care products, and dietary supplements
addressing a range of common conditions including diabetes,
allergy, hair regrowth, and gastrointestinal conditions.
Aytu Biopharma reported a net loss of $110.17 million for the year
ended June 30, 2022, compared to a net loss of $58.29 million for
the year ended June 30, 2021. As of Sept. 30, 2022, the Company had
$150 million in total assets, $96.09 million in total liabilities,
and $53.91 million in total stockholders' equity.
Denver, Colorado-based Plante & Moran, PLLC, the Company's auditor
since 2015, issued a "going concern" qualification in its report
dated Sept. 27, 2022, citing that the Company's operations have
historically consumed cash and are expected to continue to consume
cash, which raises substantial doubt about the Company's ability to
continue as a going concern.
BASIC WATER: Seeks to Extend Plan Exclusivity to September 6
------------------------------------------------------------
Basic Water Company and Basic Water Company SPE 1, LLC ask the
U.S. Bankruptcy Court for the District of Nevada to further
extend their exclusive period to file a Chapter 11 plan of
reorganization and exclusive period to solicit acceptances
thereof to September 6, 2023 and November 3, 2023, respectively.
The Debtors explained that the extension is necessary because
they are still formulating their plan of reorganization and
accompanying disclosure statement, considering the complicated
nature of the ultimate resolution of their cases, and in light of
the anticipated sale of some or all of their aseets.
This is the Debtors' second motion for extension. The Court
previously extended their exclusive filing period and exclusive
solicitation period to May 9, 2023 and July 7, 2023, respectively.
Basic Water Company and Basic Water Company SPE 1, LLC are
represented by:
Samuel A. Schwartz, Esq.
Gabrielle A. Hamm, Esq.
SCHWARTZ LAW, PLLC
601 East Bridger Avenue
Las Vegas, NV 89101
Tel: (702) 385-5544
Email: saschwartz@nvfirm.com
ghamm@nvfirm.com
About Basic Water Company
Basic Water Company, a water utility company in Nevada, and
affiliate Basic Water Company SPE 1, LLC sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Nev. Lead Case
No. 22-13252) on Sept. 10, 2022. In their petitions, Basic Water
Company listed $10 million to $50 million in assets and $1
million to $10 million in liabilities while SPE 1 listed as much
as $50 million in both assets and liabilities. Stephanne A.
Zimmerman, president, signed the petitions.
Judge Mike K. Nakagawa oversees the cases.
The Debtors tapped Samuel A. Schwartz, Esq. at Schwartz Law, PLLC
as legal counsel, and Force 10 Partners, LLC as financial
advisor. Stretto, Inc. is the claims, noticing and solicitation
agent.
BEVERLY COMMUNITY: U.S. Trustee Appoints 2 New Committee Members
----------------------------------------------------------------
The U.S. Trustee for Region 16 appointed Shiftwise Inc. and Medical
Solutions, LLC as new members of the official committee of
unsecured creditors in the Chapter 11 cases of Beverly Community
Hospital Association and its affiliates.
As of May 16, the members of the committee are:
1. Advantis Medical Staffing, LLC
Attn: Todd Simpson, CFO
13155 Noel Rd., Suite 300
Dallas, TX 75240
Telephone: 214-435-6086
Email: tsimpson@advantismed.com
Counsel:
Akerman, LLP
601 West Fifth Street, Suite 300
Los Angeles, CA 90071
Telephone: 213-668-9500
Facsimile: 213-627-6342
Email: evelina.gentry@akerman,com
paul.musser@akerman.co
2. AHMC Healthcare Inc.
Attn: Jonathan Wu, President
55 S. Raymond Avenue, Suite 105
Alhambra, CA 91801
Telephone: 626-289-9004
Facsimile: 626-289-8952
Email: ariel.qi@ahmchealth.com
Counsel:
Maan-Huei Hung
500 E. Main Street, 5th Floor
Alhambra, CA 91801
Telephone: 626-248-3301
Facsimile: 626-248-3303
Email: Maanheui@admchealth.com
3. Axis Spine LLC
Attn: DD Mate, Managing Member
1812 W. Burbank Blvd., #5384
Burbank, CA 91506
Telephone: 323-333-8341
Email: dmate@axisspineco.com
4. Medline Industries, LP
Attn: Shane Reed, Director, AIR Services
3 Lakes Drive
Northfield, IL 60093
Telephone: 847-505-6935
Email: sreed@medline.com
Counsel:
Rob Hirsh
Lowenstein Sandler
1251 Avenue of the Americas
New York, NY 10020
Telephone: 212-419-5837
Email: rhirsh@lowenstein.com
5. Outset Medical
c/o Sara Scheuerlein, Assoc. Gen. Counsel
3052 Orchard Drive
San Jose, CA 95134
Telephone: 808-265-8546
Email: sscheuerlein@outsetmedical.com
Counsel:
Steven T. Gubner
BG Law LLP
21650 Oxnard Street, Suite 500
Woodland Hills, CA 91267
Telephone: 818-827-9118
Email: sgubner@bg.law
6. Sodexo, Inc. and Affiliates
Attn: Amelia Pandolfi
400 Airborne Parkway
Cheektowaga, NY 14225
Telephone: 716-343-4065
Email: amelia.davis@sodexo.com
Counsel:
Jami B. Nimeroff
Two Penn Center, Suite 610
1500 John F Kennedy Blvd.
Philadelphia, PA 19102
Telephone: 267-861-5336
Facsimile: 267-350-9050
Email: jnimeroff@bmnlawyers.com
7. UNAC/UHCP
955 Overland Court, Suite 150
San Dimas, CA 91773
Telephone: 909-451-0566
Facsimile: 909-599-8655
Email: joe.guzynski@unacuhop.org
Counsel:
David E. Ahdoot
Bush Gottlieb
801 North Brand Boulevard, Suite 950
Glendale, CA 91203
Telephone: 818-973-3200
Facsimile: 818-973-3201
Email: dahdoot@bushgottlieb.com
8. Medical Solutions, LLC
Attn: Nicholas K. Rudman
Associate General Counsel
1010 S. 102nd Street, Ste. 300
Omaha, NE 68114
Telephone: 402-282-4487
Facsimile: 866-688-5929
Email: nick.rudman@medicalsolutions.com
Counsel:
Brian Koenig
Koley Jessen, P.C., L.L.O.
1125 S. 103rd Street, Ste. 800
Omaha, NE 68124
Telephone: 402-343-3883
Facsimile: 402-390-9005
Email: brian.koenig@koleyjessen.com
9. Shiftwise Inc.
Attn: Jacqueline Dombrowski
8840 Cypress Water Blvd., Ste. 300
Dallas, TX 75019
Counsel:
Jackie Dombrowski
AMN Healthcare
12400 High Bluff Drive
San Diego, CA 92120
Email: Jacqueline.dombrowski@
amnhealthcare.com
- and -
Dennis O'Donnell
DLA Piper
1257 Avenue of the Americas, 27th Floor
New York, NY 10026
Telephone: 212-335-4665
Email: dennis.odonnell@us.dlapiper.com
About Beverly Community Hospital Association
Beverly Community Hospital Association and affiliates operate
general medical and surgical hospitals.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Lead Case No. 23-12359) on April
19, 2023. In the petition signed by its chief executive officer,
Alice Cheng, Beverly Community disclosed $1 million to $10 million
in assets and $100 million to $500 million in liabilities.
Judge Sandra R. Klein oversees the case.
The Debtors tapped Sheppard, Mullin, Richter, and Hampton, LLP as
legal counsel.
The U.S. Trustee for Region 16 appointed an official committee to
represent unsecured creditors in the Chapter 11 case of Beverly
Community Hospital Association. The committee is represented by
Tania Moyron, Esq.
BEVERLY COMMUNITY: U.S. Trustee Appoints Tamar Terzian as PCO
-------------------------------------------------------------
Peter Anderson, the United States Trustee for Region 16, appointed
Tamar Terzian as patient care ombudsman for Beverly Community
Hospital Association.
The appointment was made pursuant to the order from the U.S.
Bankruptcy Court for the Central District of California approving a
stipulation for the appointment of a patient care ombudsman. The
United States Trustee is authorized to appoint a patient care
ombudsman in this case under Section 333(a)(1) of the Bankruptcy
Code.
In the PCO's investigation, the PCO discovered no known connections
with the Debtor, principles of the Debtor, insiders, the Debtor's
creditors, any other party or parties-in-interest, and their
respective attorneys or accountants or any person employed in the
Office of the United States Trustee.
A copy of the notice is available for free at
https://bit.ly/3W2qmTK from PacerMonitor.com.
About Beverly Community Hospital Association
Beverly Community Hospital Association and affiliates operate
general medical and surgical hospitals.
The Debtors sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. C.D. Cal. Lead Case No. 23-12359) on April
19, 2023. In the petition signed by its chief executive officer,
Alice Cheng, Beverly Community disclosed $1 million to $10 million
in assets and $100 million to $500 million in liabilities.
Judge Sandra R. Klein oversees the cases.
The Debtors tapped Sheppard, Mullin, Richter, and Hampton, LLP as
legal counsel.
BRIDGE COMMUNICATIONS: Seeks to Hire Money Equations as Accountant
------------------------------------------------------------------
Bridge Communications LLC seeks approval from the U.S. Bankruptcy
Court for the Eastern District of Virginia to employ Lakshmi Gupta,
CPA and Money Equations, Inc. to perform accounting services.
The firm will receive compensation as follows:
a. Payroll - $75 per payroll, for up to 5 paychecks, including
one base state. The 6th paycheck and onwards, would be billed at $3
per additional paycheck, per payroll processing.
b. Bookkeeping/Accounting - $85/hour for bookkeeping;
$115/hour for all accounting functions like budgeting, financial
analysis, project accounting, forecasting, estimated taxes,
consultations, etc.
c. Tax Preparation -- the flat fee starts at $695 and the
final price would depend on complexity of the return.
Ms. Gupta, CPA, founder of Money Equations, Inc., assured the court
that her firm is a disinterested person within the meaning of 11
U.S.C. Sec. 327.
The firm can be reached through:
Lakshmi Gupta, CPA
Money Equations Inc.
3735 Pilgrim Green Way
Fairfax, VA 22033
Phone: +1 571-310-4050
Email: lgupta@moneyequations.com
About Bridge Communications
Bridge Communications LLC is a video production and communications
company.
Bridge Communications filed its voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. E.D. Va. Case No.
23-10467) on March 23, 2023. The petition was signed by Edward
Tropeano as owner. At the time of filing, the Debtor estimated
$100,000 to $500,000 in assets and $1 million to $10 million in
liabilities.
Ashvin Pandurangi, Esq. at Vivona Pandurangi, PLC represents the
Debtor as counsel.
CBL & ASSOCIATES: S&P Alters Outlook to Negative, Affirms 'B' ICR
-----------------------------------------------------------------
S&P Global Ratings revised the rating outlook to negative from
stable and affirmed all of its ratings on U.S.-retail REIT CBL &
Associates Properties Inc. (CBL), including the 'B' issuer credit
rating and the 'BB-' issue-level rating with a '1' recovery rating,
indicating its expectations of very high (90%-100%; rounded
estimate 95%) recovery in a hypothetical default scenario, on the
company's senior secured term loan due in 2025.
S&P said, "The negative outlook reflects our view that CBL may face
additional pressures to its liquidity and experience difficulty
refinancing its debt maturities as our forecast anticipates
fixed-charge coverage (FCC) to decrease from higher interest
expense and significant debt principal amortization over the next
year.
"We expect CBL's FCC to remain under pressure from elevated
interest expense and material debt principal amortization. Over the
past year, CBL's S&P Global Ratings-adjusted FCC remained under
pressure despite an improved balance sheet following the emergence
from bankruptcy in November 2021. As of year-end 2022, the adjusted
FCC ratio was 1.0x and we do not anticipate material improvement
within the next year, given sustained high interest rates and the
high percentage of variable debt within the company's capital
structure. Around 41% of the company's debt (including its pro rata
share of unconsolidated affiliates, excluding deferred financing
costs and debt discounts) was variable at year-end 2022 and most
debt was secured. We do not foresee a decrease in debt principal
amortization from less debt and we expect floating-rate debt to
remain near current levels over the next year. That said, we
acknowledge that some of the interest expense in 2022 was noncash
and related to fresh start accounting. However, even when excluding
the impact from the accretion of debt discounts under GAAP, FCC
still underperformed our expectations at 1.4x. We expect FCC to
remain under pressure for the next year due to sustained high
interest rates and material debt principal amortization, including
substantial term loan amortization.
"We are monitoring the company's progress of extending its debt
maturity profile.Although CBL's near-term, recourse debt maturities
are manageable, the company has a shorter weighted average debt
profile relative to other rated REITs at 2.8 years when excluding
extension options (2.83 years when including the pending extension
at Cross Creek mall). We typically view companies with short debt
maturity ladders (less than three years for real estate entities)
as having greater refinancing risk relative to peers with
longer-weighted average debt maturities. In CBL's case, most of its
debt ($816.7 million as of March 31, 2023) is associated with its
secured term loan due in November 2025. While this is less than
three years away, we note that CBL has extensions available to
extend the maturity by up to two additional years, subject to
certain stipulations, including paying down the term loan to $670
million in November 2025 followed by $615 million in November 2026.
Given the company's current liquidity position (which includes $282
million in cash and marketable securities), we view these
extensions as feasible. When including all extension options, we
note that the company's debt maturity profile is more manageable at
3.8 years (3.9 years when including pending extension at Cross
Creek mall). Nevertheless, we could view CBL's capital structure
negatively should the company prove unable to extend its
maturities, while facing additional headwinds that could further
hinder its refinancing prospects."
The company's capital structure contains a material amount of
secured debt, which includes guarantees on some of its joint
venture debt, with near-term maturities. As of Dec. 31, 2022,
around $553.9 million of property-level debt, including
unconsolidated debt and related obligations, was due or callable
within the next 12 months at full value (or classified as such per
accounting due to being in default). These figures include loans
remaining in default following the bankruptcy. This debt is
non-recourse and therefore does not impact our liquidity analysis.
And while expect CBL to return some underperforming properties back
to lenders, S&P believes it must address other maturities via
refinancing and extensions. This could prove difficult given the
current lending environment and could require CBL to pay down
certain maturities, utilizing some of the company's liquidity
sources. That said, CBL had made some progress at addressing
upcoming maturities, with more than $312 million in financing
activity completed through May 10, 2023. This included a newly
modified non-recourse loan secured by the West County Center for
$161.9 million (80.9 million at CBL's share) and a new $148 million
loan ($74 million at CBL's share) secured by the Friendly Center
and the Shops at Friendly Center. The company is currently in
discussions to extend the $96.2 million loan secured by Cross Creek
Mall by two years.
S&P said, "Despite improvements in occupancy, we expect same-center
net operating income (NOI) growth at CBL's predominately 'B'
quality mall portfolio to be negative over the next year. In 2022,
same-center NOI was up by approximately 1% year over year,
supported by occupancy improvements (91% in 2022 compared with
89.3% in 2021) and higher percentage rents, a positive variance due
to the recovery of uncollectable revenues partially offset by the
impact of some negative renewal lease spreads and a modest increase
in operating expenses from inflation. However, same-center tenant
sales per square foot for the 12 months ended Dec. 31, 2022,
declined 2.6% compared with same-period in the previous year. This
trend continued in the first quarter of 2023, with trailing
twelve-month sales declining 3.1% relative to the same period in
2022. In addition, same-center NOI turned negative (negative 4.5%
in the first quarter of 2023), largely due to unfavorable variances
in uncollectible revenue and a decline in percentage rents, which
offset rent growth. We expect same-center NOI growth to remain
modestly negative in 2023, with improvements in rental rates and
occupancy offset by volatility in uncollectible revenue, lower
percentage rents, and the impact of retail bankruptcies.
"We note the company achieved good progress at stabilizing
occupancy over the past year--portfolio occupancy increased 150
basis points year over year to 89.8% as of March 31, 2023, with new
leases signed during the quarter at 2.5% higher average rent. That
said, re-leasing spreads remained modestly negative, and we expect
the company to continue to favor retaining occupancy rather than
raising rents. We believe the 'B' quality mall assets held by CBL
will continue to experience lagging operating metrics (lower
occupancy, same-store NOI growth, re/leasing spreads) compared to
higher mall quality mall peers. Moreover, in our view, the
company's mall focus is inherently less defensive given a greater
focus on discretionary and nonessential items. We believe CBL's
constrained cash flows result in minimal additional capital to
re-develop properties, which could further deteriorate the
company's asset quality and diminish its competitive position
relative to peers that have better quality assets.
"Elevated lease expirations over the next two years along with
contraction in consumer spending due to inflationary environment
could pressure CBL's rent growth and occupancy. We expect the U.S.
to enter a recession in 2023 as the Fed's aggressive rate hikes
take hold and inflation remains high, albeit slowing from its peak
during the third quarter of 2022, and as a result consumers will
continue to pull back on spending (particularly discretionary
purchases) as these higher borrowing costs erode most household
savings and as consumer sentiment remains low. In addition, while
still below levels seen in the years prior to the pandemic,
bankruptcies have accelerated over the past few quarters and we
expect there could be additional retail distress. As a result,
there could be a slowdown in leasing activity. The company faces
elevated lease expirations for its mall, lifestyle centers, and
outlet centers relative to other real estate asset classes, with
14.2% of annualized gross rent expiring in 2023, 26.7% in 2024, and
17% in 2025, as of Dec. 31, 2022. The higher expirations are due to
its mall focus as well as shorter-term leases signed during the
pandemic in an effort to preserve occupancy and the company's
temporary leasing program (which attracts some tenants looking to
test out the open air or outlet format). In our view, shorter-term
leases could contribute to increased volatility in cash flows (as
most of these have a variable-rate rent escalator component) and
pressure occupancy.
"The negative outlook reflects our expectation for FCC to be under
pressure from higher interest expense and significant debt
principal amortization over the next year, while liquidity could
deteriorate if the company is unable to refinance upcoming
maturities. This could result in CBL using cash and marketable
securities because it does not have access to a revolving credit
facility, leading us to a less favorable view of its liquidity
position. It also reflects the risk that the company's debt
maturity profile could remain less than three years, potentially
leading to a negative view of the company's capital structure."
S&P could lower the rating on CBL if:
-- The debt maturity profile remains shorter in duration, with
elevated refinancing risk persisting, leading to a negative view of
the company's capital structure;
-- Operating performance declined, particularly within its
enclosed mall portfolio, from tenant bankruptcies or store
closures, which could result in deterioration to its liquidity
assessment, business prospects, and credit protection measures;
-- The company has difficulty transitioning noncore assets back to
their respective servicers, leading to a near-term risk of default;
or
-- Fixed-charge coverage does not improve and remains below 1.3x.
S&P could revise the outlook to stable if:
-- CBL successfully extends its debt maturity profile, with a
clear path for the term loan to meet stipulations for extensions in
2026 and 2027 such that the company's weighted average maturities
are over three years;
-- Liquidity sources remaining adequate, with sufficient cash and
cash equivalents (including investments in treasuries) to
compensate for the company's lack of a revolving credit facility;
and
-- FCC improves and is expected to remain around 1.3x or better.
ESG credit indicators: E-2, S-2, G-2
S&P said, "ESG factors have no material influence on our credit
rating analysis of CBL. That said, CBL's assets are focused on the
retail sector, which is indirectly exposed to shifts in consumer
behavior and demographic trends. The need to redevelop or
reposition its retail assets requires significant investment,
particularly as department stores and other anchor tenants close.
We believe the continued disruption in the retail sector remains a
risk, especially for the weaker-positioned retail assets, such as
those in CBL's portfolio, and those with greater exposure to
nondiscretionary retailers."
CENTRALIA APARTMENTS: Case Summary & 20 Top Unsecured Creditors
---------------------------------------------------------------
Debtor: Centralia Apartments
1314 Wilshire Blvd.
Los Angeles, CA 90017
Business Description: The Debtor is a Single Asset Real Estate
as defined in 11 U.S.C. Section 101(51B).
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-13132
Judge: Hon. Barry Russell
Debtor's Counsel: D. Edward Hays, Esq.
MARSHACK HAYS LLP
870 Roosevelt
Irvine, CA 92620-3663
Tel: (949) 333-7777
Fax: (949) 333-7778
Email: ehays@marshackhays.com
Estimated Assets: $10 million to $50 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Dennis G. Gesolowitz as in-house
counsel.
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/C4M2C4Q/Centralia_Apartments__cacbke-23-13132__0001.0.pdf?mcid=tGE4TAMA
List of Debtor's 20 Largest Unsecured Creditors:
Entity Nature of Claim Claim Amount
1. Accident Fund Insurance of $77
America
P.O. Box 40790
Lansing, MI 48901
2. Accurate Metering Products Service $30,000
5773 Venice Blvd.
Los Angeles, CA 90019
3. AT&T Utility $3,200
P.O. Box 537104
Atlanta, GA 30353
4. Charter Communications Utility $1,557
7910 Crescent
Executive Drive
Charlotte, NC 28217
5. City of Lakewood Taxes $3,200
5050 Clark Avenue
Lakewood, CA 90712
6. Edco Waste Services Utility $4,750
6254 N. Paramount Blvd.
Long Beach, CA 90805
7. Everest Insurance $5,200
100 Everest Way
Warren, NJ 07059
8. First Insurance Funding Trade Debt $349
450 Skokie Blvd
Suite 1000
Northbrook, IL 60062
9. Franchise Tax Board Taxes $800
Bankruptcy Section,
MS:A-340
P.O. Box 2952
Sacramento, CA
95812-2952
10. Frontier Communications Utility $2,200
401 Merritt 7 Ste. 7
Norwalk, CT 06851
11. Golden State Water Company Utility $3,200
1600 W. Redondo Beach Blvd.
Unit 101
Gardena, CA 90247
12. Kimball Tirey St. Attorneys Fees $6,200
John LLP
915 Wilshire Blvd.
Unit 1650
Los Angeles, CA 90017
13. Los Angeles County Recorder $1,200
12400 Imperial
Highway
Norwalk, CA 90650
14. Morgan Lewis Attorneys Fees $275,000
300 S. Grand Ave.,
22nd Fl.
Los Angeles, CA 90071
15. Proland Management Loan $50,000
Company LLC
2510 West 7th Street
Los Angeles, CA
90057
16. Queens Guard Security $4,200
903 North San Fernando
Burbank, CA 91504
17. Southern California Edison Utility $2,600
P.O. 300
Covina, CA 91722
18. Southern California Gas Co. Utility $5,500
P.O. Box C
Monterey Park, CA
91756
19. The Gas Company Trade Debt $2,641
P.O. Box C
Monterey Park, CA
91756
20. Verizon $2,150
P.O. Box 489
Newark, NJ
07101-0489
CERTIFIED 360: Seeks to Hire Mickler & Mickler as Legal Counsel
---------------------------------------------------------------
Certified 360, LLC asks the U.S. Bankruptcy Court for the Middle
District of Florida to employ the Law Offices of Mickler & Mickler,
LLP as counsel.
The hourly rates charged by the firm for legal services range from
$250 to $350. In addition, the firm will seek reimbursement for
out-of-pocket expenses incurred.
Bryan Mickler, Esq., at the Law Offices of Mickler & Mickler,
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:
Bryan K. Mickler, Esq.
Law Offices of Mickler & Mickler, LLP
5452 Arlington Expy.
Jacksonville, FL 32211
Tel: (904) 725-0822
Fax: (904) 725-0855
Email: bkmickler@planlaw.com
About Certified 360
Certified 360, LLC is part of the construction industry. The Debtor
sought protection under Chapter 11 of the U.S. Bankruptcy Code
(Bankr. M.D. Fla. Case No. 23-01002) on May 4, 2023. In the
petition signed by Ashley Downing, managing member, the Debtor
disclosed $528,466 in assets and $1,598,966 in liabilities.
Judge Jacob A. Brown oversees the case.
Bryan K. Mickler, Esq., at Law Offices of Mickler & Mickler, LLP,
represents the Debtor as legal counsel.
CHECKERS HOLDINGS: $192.5M Bank Debt Trades at 53% Discount
-----------------------------------------------------------
Participations in a syndicated loan under which Checkers Holdings
Inc is a borrower were trading in the secondary market around 46.7
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $192.5 million facility is a Term loan that is scheduled to
mature on June 30, 2024. The amount is fully drawn and
outstanding.
Checkers Holdings, Inc. operates as a holding company. The
Company,
through its subsidiaries, provides burgers, chicken wings, hot
dogs, fishes, and beverages. Checkers Holdings serves customers in
the United States.
CLAUSEN OYSTERS: Case Summary & Two Unsecured Creditors
-------------------------------------------------------
Debtor: Clausen Oysters, LLC
66234 North Bay Road
North Bend, OR 97459
Business Description: The Debtor owns an oyster farm in the
State of Oregon.
Chapter 11 Petition Date: May 18, 2023
Court: United States Bankruptcy Court
District of Oregon
Case No.: 23-60847
Judge: Hon. Thomas M. Renn
Debtor's Counsel: Nicholas J. Henderson, Esq.
MOTSCHENBACHER & BLATTNER, LLP
117 SW Taylor St., Suite 300
Portland, OR 97204
Tel: (503) 417-0500
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Seth Silverman as manager.
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/NKM5CVQ/Clausen_Oysters_LLC__orbke-23-60847__0001.0.pdf?mcid=tGE4TAMA
COMMUNITY HOME: Trustee & Creditors File Liquidating Plan
---------------------------------------------------------
Kristina Johnson, Chapter 11 trustee for Community Home Financial
Services, Inc. ("CHFS"), and creditors, Edwards Family Partnership
LP ("EFP") and Beher Holdings Trust ("BHT") (together, the "Plan
Sponsors") submitted a Third Amended Disclosure Statement for the
Third Amended Joint Chapter 11 Plan of Liquidation for the Debtor
dated May 15, 2023.
The Debtor is in the business of purchasing and servicing loan
portfolios consisting of mostly Class B loans of 2nd to 3rd
mortgages.
In approximately 2007, the Debtor entered into various arrangements
with Edwards Family Partnership ("EFP"), Beher Holdings Trust
("BHT") (together with EFP, "EFP/BHT"), and/or affiliates or
predecessors of EFP and BHT whose ultimate principal is believed to
be Dr. Edwards.
In February 2012, CHFS and Dickson (acting in his individual
capacity as well as in his role as president and director of CHFS)
Filed a complaint against, inter alia, EFP/BHT and Dr. Edwards
concerning the obligations and rights under various agreements
purporting to establish joint ventures between the parties as well
as the liability of the respective parties for alleged breach of
those agreements. EFP/BHT and Dr. Edwards counterclaimed against
CHFS as well as Dickson, seeking to enforce certain guaranty
agreements. This litigation was stayed as to CHFS upon its chapter
11 Filing.
This is a fully consensual Plan pursuant to section 1129 in which
EFP/BHT are the only creditors Impaired by the Plan and therefore,
the only creditors entitled to vote. EFP/BHT, as joint Plan
Sponsors with the Trustee, are deemed to accept the Plan and
therefore, no voting is required.
Class 3 consists of the EFP/BHT Claim. Unless otherwise agreed in a
written agreement by and between the Holders of an Allowed EFP/BHT
Claim and the Trustee, the following treatment is afforded the
Holders of Class 3 Claims of the EFP/BHT Claim.
* On or before the Effective Date, the Trustee will assign,
without recourse or warranty of any kind or nature, to EFP/BHT or
its designee or assigns, any Loan held by or owned by the Estate,
regardless of whether any such Loans were purchased before or after
the Petition Date. EFP/BHT, or their designee or assigns, will be
responsible for issuing statements and all other forms or documents
required by State or federal law related to the Loans for the
entire calendar year in which the assignment occurs.
* On or before the Effective Date, the Trustee will transfer
to EFP/BHT or their assignee or designee via quitclaim deed or
comparable instrument, without recourse or warranty, any Loan which
the Trustee has a right to recover due to any avoidable transfer of
such Loan.
* On or before the Effective Date of the Plan, the Trustee
shall assign to EFP/BHT, or their designees or assigns, her rights
in the Edwards Adversary Proceedings as part of the Distribution on
the EFP/BHT Claim. Within 10 days after the Effective Date, EFP/BHT
shall dismiss with prejudice the Edwards Adversary Proceedings. For
the avoidance of doubt, the Trustee will assign the U.S. Forfeiture
Order and the Final Judgment on Trustee's Dickson Trial to
EFP/BHT.
* The Trustee will assume and assign the Executory Contracts
on Plan without recourse or warranty of any kind or nature, to
EFP/BHT (or their designee). Furthermore, the Indemnification
Agreement dated June 16, 2014, between EFP/BHT and the Servicer
will be amended to delete the portion of said Agreement by which it
expires upon the third anniversary of the termination of the
Servicing Agreement.
* On or before the Effective Date, the Trustee will convey,
without recourse or warranty of any kind or nature, to EFP/BHT or
their designee, any property of CHFS or the Estate, real or
personal, as is/where is subject to all existing liens and
encumbrances. EFP/BHT or their assignee or designee will be
responsible for all obligations regarding the property conveyed
under the Plan after the Effective Date.
* On the Effective Date, the Trustee will convey the remaining
Cash in the Estate after Classes 1, 2, and 4 are paid in full, less
$75,000, which will be held by the Trustee and not disbursed
without further order of the Court. These funds will be available
to pay Estate Professionals for the fees and expenses incurred in
confirming this Plan, after notice and a hearing. To the extent
these funds are not paid to Estate Professionals, the funds will be
distributed to the EFP/BHT, or their assigns or designees.
Class 4 consists of General Unsecured Claims. General Unsecured
Claims are Unimpaired under the Plan. Unless otherwise agreed in a
written agreement by and among the Holder of a General Unsecured
Claim and the Trustee, on the Effective Date, in full satisfaction
of the Holder's General Claim, each Holder of a General Unsecured
Claim will receive Cash in an amount equal to the Allowed amount of
such Holder's General Unsecured Claim, exclusive of any and all
accrued interest. The Trustee estimates the approximate Allowed
amount of General Unsecured Claims is zero, as of May 15, 2023.
On or before the Effective Date, the Trustee shall execute
documents sufficient to transfer to EFP/BHT or their designees, or
assigns, any Loan owned by or serviced by the Estate constituting,
or included in, the Home Improvement Loans, the Mortgage Loan
Portfolios, the Unclassified Loans, the U.S. Forfeiture Order, and
any rights in the Foreign Loans or claims related to the Foreign
Loans. At her discretion, Trustee may execute said documents by
power of attorney. All costs associated with the preparation and/or
recordation of the documents shall be borne by EFP/BHT, their
designees, or assigns. EFP/BHT, their designees, or assigns will be
responsible for issuing statements and all other forms or documents
required by State or federal law related to the Loans for the
calendar year in which the assignment occurs.
On the Effective Date, the Trustee will transfer all remaining Cash
in the Estate to EFP/BHT, or their assigns, or designees, less the
$75,000 amount which will be available to pay the Estate
Professionals pursuant to authorization from the Court.
On or before the Effective Date, the Trustee shall execute
documents sufficient to transfer to EFP/BHT or their assignees or
designees all rights to funds associated with the U.S. Forfeiture
Order, all funds associated with the Forfeiture Order (including
the Costa Rica Condo Sale Proceeds) and all funds and/or assets
currently in or being held by the Costa Rican Government. All costs
associated with the preparation and/or recordation of the documents
shall be borne by EFP/BHT. EFP/BHT will be responsible for issuing
statements and all other forms or documents required by State,
federal, and/or foreign law related to the Loans for the calendar
year in which the assignment occurs.
A full-text copy of the Third Amended Disclosure Statement dated
May 15, 2023 is available at https://bit.ly/3ImsLTp from
PacerMonitor.com at no charge.
Counsel for the Trustee:
Jeffrey R. Barber, Esq.
Kristina M. Johnson, Esq.
JONES WALKER LLP
190 East Capitol Street, Suite 800 (39201)
Post Office Box 427
Jackson, Mississippi 39205-0427
Telephone: (601) 949-4765
Facsimile: (601) 949-4804
Email: jbarber@joneswalker.com
kjohnson@joneswalker.com
Mark A. Mintz, Esq.
JONES WALKER LLP
201 St. Charles Avenue, Suite 5100
New Orleans, Louisiana 70170-5100
Telephone: (504) 582-8368
Facsimile: (504) 589-8368
Email: mmintz@joneswalker.com
Counsel for Edwards Family:
Jim F. Spencer, Jr., Esq.
Stephanie M. Rippee, Esq.
WATKINS & EAGER PLLC
P.O. Box 650
Jackson, MS 39205-0650
(601) 965-1900 (p)
Email: jspencer@watkinseager.com
srippee@watkinseager.com
About Community Home Financial Services
Community Home Financial Services, Inc. is a specialty finance
company providing contractors with financing for their customers.
It operated from one central location providing financing through
its dealer network throughout 25 states, Alabama, Delaware, and
Tennessee. On December 23, 2013, Community Home Financial changed
its principal place of business to Panama.
Community Home Financial filed a Chapter 11 petition (Bankr. S.D.
Miss. Case No. 12-01703) on May 23, 2012, with $44.9 million in
total assets and $30.3 million in total liabilities. William D.
Dickson, president of Community Home Financial, signed the
petition.
Judge Edward Ellington presides over the case.
The Debtor was first represented by Roy H. Liddell, Esq., and
Jonathan Bissette, Esq., at Wells, Marble, & Hurst, PPLC as Chapter
11 counsel. Wells Marble was terminated Nov. 13, 2013.
The Debtor later engaged Derek A. Henderson, Esq., in Jackson,
Mississippi. In 2013, the Debtor sought to employ David Mullin,
Esq., at Mullin Hoard & Brown LLP, as special counsel.
On Jan. 9, 2014, Kristina M. Johnson was appointed as Chapter 11
trustee for the Debtor. Jones Walker LLP served as counsel to the
trustee, while Stephen Smith, C.P.A., acted as accountant.
COX INDUSTRIAL: Court OKs Interim Cash Collateral Access
--------------------------------------------------------
The U.S. Bankruptcy Court for the District of Arizona authorized
Cox Industrial Services, LLC to use cash collateral on an interim
basis in accordance with the budget, with a 10% variance.
As previously reported by the Troubled Company Reporter, the Debtor
requires the use of cash collateral to continue operations and
successfully reorganize.
As of the Petition Date, the Debtor believes it has the following
assets that are currently or may be converted post-petition to cash
collateral:
a. Approximately $21,081 on deposit with JP Morgan Chase Bank,
NA;
b. Approximately $2.8 million in outstanding receivables, only
$800,000 which the Debtor currently believes are collectable; and
c. Approximately $150,000 in raw materials.
As of the Petition Date, the Debtor believes these creditors may an
assert an interest in cash collateral:
a. Chase, which holds a claim in the estimated amount of
$840,000 and has filed UCC Financing Statements with the Arizona
Secretary of State on September 18, 2012 at Filing No.
2012-170-7562-5; September 5, 2013 at Filing No. 2013-175-1686-8;
and February 24, 2016 at Filing No. 2016-000-7524-6; and
b. Arizona Department of Revenue, which holds a claim in the
alleged amount of $131,278 as evidenced by Notices of State Tax
Liens filed with the Arizona Secretary of State on December 8, 2022
at Filing No. 2022-007-2237-9; and February 23, 2023 at Filing No.
2023-001-2229-0.
The Debtor additionally has these creditors believed to have
purchase-money security interests on specific equipment and
vehicles: Ally; Cat Financial Commercial Account; Ford Motor Credit
Company; Tom & Gloria Bastien/Bastien family Trust; Toyota
Financial Services.
In additional to its security interest over the Debtor's personal
property, Chase also holds a first-position lien on the Debtor's
real property, estimated to be worth $2.5 million.
The Debtor asserts Chase has approximately $1.7 million of equity
in the Debtor's real property making any diminution in cash
collateral unlikely to have any material impact on Chase. The only
other creditor the Debtor believes may have a cash collateral
interest, ADOR, holds a total claim that is only a fraction of the
Debtor's current outstanding receivables.
The court said the Cash Collateral Creditors will receive
replacement liens in the Debtor's post-petition cash and
receivables to the same extent, validity, and priority up to the
value of any depreciation in the value of such creditor's security
interest on the Petition Date arising from the Debtor's use of cash
collateral during the pendency of the Case. Notwithstanding the
foregoing, all parties reserve all rights regarding the extent,
validity, and priority of the Cash Collateral Creditors interests
in the Debtor's assets.
A hearing on the matter is set for May 23, 2023 at 2 p.m.
A copy of the order is available at https://bit.ly/3MbvYqj
PacerMonitor.com.
About Cox Industrial Services, LLC
Cox Industrial Services, LLC operates an agricultural engineering
and fabrication business focusing on industrial refrigeration.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case No. 23-02866) on May 2, 2023.
In the petition signed by Randy Cox, owner, the Debtor disclosed
$5,793,413 in assets and $4,238,957 in liabilities.
Judge Scott H. Gan oversees the case.
Thomas H. Allen, Esq., at Allen, Jones & Giles, PLC, represents the
Debtor as legal counsel.
CPC ACQUISITION: $225M Bank Debt Trades at 56% Discount
-------------------------------------------------------
Participations in a syndicated loan under which Cpc Acquisition
Corp is a borrower were trading in the secondary market around 43.6
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $225 million facility is a Term loan that is scheduled to
mature on December 29, 2028. The amount is fully drawn and
outstanding.
CPC Acquisition Corp is in the chemicals industry.
CROWN FINANCE: $650M Bank Debt Trades at 85% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Crown Finance US
Inc is a borrower were trading in the secondary market around 14.8
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $650 million facility is a Term loan that is scheduled to
mature on September 20, 2026. The amount is fully drawn and
outstanding.
Crown Finance US, Inc. operates as a movie theater.
CURO GROUP: S&P Downgrades ICR to 'SD' on Distressed Debt Exchange
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on Curo Group
Holdings Corp. to 'SD' from 'B-'. S&P also lowered its issue rating
on the company's senior secured notes to 'D' from 'CCC+'.
S&P said, "The downgrade follows Curo's completion of a distressed
debt exchange. We consider the transaction distressed because, in
our view, the noteholders of the remaining $317.7 million of senior
secured notes received less value than originally promised. The
ranking of those notes was altered to be more junior with no
offsetting compensation. Furthermore, Curo received waivers for
some of its debt covenants, and we believe the company would have
had difficulty extending the waivers or renegotiating the covenants
without this transaction. A breach of covenants could result in an
event of default under some of Curo's debt agreements."
On May 15, Curo Group Holdings Corp. exchanged $682.3 million of
its senior secured notes with $682.3 million of senior 1.5-lien
secured notes. As part of the transaction, the remaining $317.7
million of senior secured notes are now more junior than the senior
1.5-lien secured notes. Additionally, the company entered into a
first-lien $150 million credit facility with the holders of the
$682.3 million of senior 1.5-lien secured notes, replacing the $40
million senior first-lien revolver.
S&P said, "We expect to reevaluate our issuer credit rating and
debt ratings on Curo over the next week. While the transaction has
improved Curo's liquidity by over $100 million, the company's
interest expense will continue to rise given the high coupon on the
new $150 million first-lien credit facility. We expect interest
expense for 2023 to be at least $250 million, above the company's
pro forma unrestricted cash of $195 million. The new debt also has
a minimum liquidity covenant of $75 million from May 31, 2023 to
Sept. 30, 2024, and the company's cushion to this covenant could be
eroded by future origination growth or weak asset quality."
CYXTERA DC: $100M Bank Debt Trades at 39% Discount
--------------------------------------------------
Participations in a syndicated loan under which Cyxtera DC Holdings
Inc is a borrower were trading in the secondary market around 60.7
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $100 million facility is a Term loan that is scheduled to
mature on May 1, 2024. About $97.5 million of the loan is
withdrawn and outstanding.
Cyxtera DC Holdings, Inc. provides data center services.
CYXTERA DC: $815M Bank Debt Trades at 39% Discount
--------------------------------------------------
Participations in a syndicated loan under which Cyxtera DC Holdings
Inc is a borrower were trading in the secondary market around 60.8
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $815 million facility is a Term loan that is scheduled to
mature on May 1, 2024. About $768.1 million of the loan is
withdrawn and outstanding.
Cyxtera DC Holdings, Inc. provides data center services.
DEAN ST BROOKLYN: Rental Income to Fund Plan Payments
-----------------------------------------------------
Dean St Brooklyn LLC (DE) filed with the U.S. Bankruptcy Court for
the Southern District of Florida a Disclosure Statement describing
Chapter 11 Plan dated May 15, 2023.
This chapter 11 was filed October 18, 2022 to reorganize the first
mortgage and the two condo associations, as well as a large
unsecured claim.
The Debtor has contributed new value including attorneys' fees,
plus much more. Debtor is and will also be paying bank and NY
payments along with US Trustee fees, and payments to unsecured and
administrative creditors, adding up to a significant sum. New value
is counted as a credit against the absolute priority rule.
Class 2 consists of the Secured Claim of U.S. Bank National
Association $757,015.06. Creditor retains lien and existing
foreclosure dismissed. Creditor shall receive cash $430,000 at
confirmation for satisfaction.
Class 3 consists of the Secured Claim of New York City Dept Fin.
Creditor retains lien and shall receive $1863.41 paid 1/2 at
confirmation and 1/2 in month 2 ($931).
Class 4 consists of the Claim of NYC Environmental Control/water
board. Creditor retains lien and shall receive $2933.50 paid 1/2 at
confirmation and 1/2 in month 2 ($1467).
Equity Holders will retain their interests or be issued new
memberships for new value paid in this case.
Payments and distributions under the Plan will be funded by Yonel
Devico and affiliates and rent income.
A full-text copy of the Disclosure Statement dated May 15, 2023 is
available at https://bit.ly/3oeJn8W from PacerMonitor.com at no
charge.
Attorney for the Plan Proponent:
Joel M. Aresty, Esq.
Joel M. Aresty, P.A.
309 1st Ave S
Tierra Verde FL 33715
Tel: (305) 904-1903
Fax: (800) 899-1870
Email: Aresty@Mac.com
About Dean St Brooklyn LLC (DE)
Dean St Brooklyn LLC (DE) sought protection for relief under
Chapter 11 of the Bankruptcy Code (Bankr. S.D. Fla. Case No.
22-18042) on Oct 11, 2022, with up to $500,000 in assets and up to
$1 million in liabilities. Judge Laurel M. Isicoff oversees the
case.
Joel M. Aresty, Esq. at Joel M. Aresty, P.A., serves as the
Debtor's legal counsel.
DELUXE CORP: Egan-Jones Retains B Senior Unsecured Ratings
----------------------------------------------------------
Egan-Jones Ratings Company on May 5, 2023, maintained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by Deluxe Corporation. EJR also withdraws 'A3' rating
on commercial paper issued by the Company.
Headquartered in Minneapolis, Minnesota, Deluxe Corporation
operates as a payments and business technology company.
DET MEDICAL: PCO Joseph Tomaino Submits First Report
----------------------------------------------------
Joseph Tomaino, the court-appointed patient care ombudsman, filed
with the U.S. Bankruptcy Court for the Eastern District of New York
a first report regarding the health care facility operated by DET
Medical PC.
On May 3, 2023, the PCO participated in a hearing regarding the
lease agreement. During this hearing, Michelle Gallimore, Esq.,
attorney for DET Medical, represented that arrangements had been
made for DET Medical to leave the premises and for a storage
facility for the records to be relocated to.
During this period, the PCO received communication from Matthew
Spero, attorney for landlord, Shelly Estates Group, LLC, regarding
DET Medical's decision to vacate the premises on April 21, 2023,
and there was concern it may leave behind medical records.
After the date DET Medical was supposed to vacate the premises, the
PCO contacted Mr. Spero who reported that DET Medical had not moved
out. He added that the landlord went to the premises and the
waiting room was active with patients waiting to be seen.
The PCO noted that the current risk level for this case is
determined to be high level based on observations. Practicing
medicine without malpractice coverage represents a significant risk
for patients, particularly when they are unaware of this fact. The
uncertainty about the continuation of the practice and the status
of the medical records also creates a risk for continuity of
patient care and for security of protected health information.
A copy of the Ombudsman Report is available for free at
https://bit.ly/3pFrrF1 from PacerMonitor.com.
The ombudsman may be reached at:
Joseph J. Tomaino
Chief Executive Officer
Grassi Healthcare Advisors LLC
50 Jericho Quadrangle, 2nd floor
Jericho, NY 11753
Telephone: (212) 223-5020
Email: jtomaino@grassihealthcareadvisors.com
About DET Medical
DET Medical P.C. filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. E.D.N.Y. Case No. 23-40497) on Feb. 14,
2023, with $500,000 to $1 million in both assets and liabilities.
Salvatore LaMonica, Esq. has been appointed as Subchapter V
trustee.
Judge Jil Mazer-Marino oversees the case.
The Debtor is represented by Michelle Gallimore, Esq.
DGA HOLDINGS: Seeks to Hire Lee Legal as Bankruptcy Counsel
-----------------------------------------------------------
DGA Holdings, Inc. seeks approval from the U.S. Bankruptcy Court
for the District of Columbia to employ Lee Legal, PLLC as counsel.
The firm's services include:
a. advising the Debtor generally regarding matters of bankruptcy
law;
b. conducting examinations of witnesses, claimants or adverse
parties, and preparing and assisting in the preparation of legal
documents;
c. advising the Debtor concerning confirmation of its plan of
reorganization;
d. performing those legal services necessary to the Debtor's
reorganization, including, but not limited to, institution and
prosecution of legal proceedings and legal advice regarding debt
restructuring; and
e. taking other actions necessary for the proper preservation
and administration of the Debtor's bankruptcy estate, including,
but not limited to, general advice and counsel in connection with
their ongoing business operations.
The firm will be paid at the rate of $450 per hour and will be
reimbursed for out-of-pocket expenses incurred.
The Debtor paid the firm an advance payment of $1,479.
Brian Lee, Esq., sole practitioner at Lee Legal, 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:
Brian V. Lee, Esq.
Lee Legal, PLLC
1250 Connecticut Avenue, 7th Fl.
Washington, DC 20036
Tel: (202) 448-5136
Email: bvlee@lee-legal.com
About DGA Holdings
DGA Holdings, Inc., filed a Chapter 11 bankruptcy petition (Bankr.
D.D.C. Case No. 22-00226) on Dec. 6, 2022, with $50,001 to $100,000
in assets and $100,001 to $500,000 in liabilities. Judge Elizabeth
L. Gunn oversees the case.
The Debtor is represented by Brian V. Lee, Esq., at Lee Legal,
PLLC.
DIOCESE OF ALBANY: Taps Bond Schoeneck & King as Special Counsel
----------------------------------------------------------------
The Roman Catholic Diocese of Albany, New York seeks approval from
the U.S. Bankruptcy Court for the Northern District of New York to
employ Bond Schoeneck & King, PLLC as special counsel.
The Debtor needs the firm's legal assistance in connection with a
case pending at the United States Employment Opportunity Commission
related to complaints for unfair labor practices under Title VII of
the Civil Rights Act of 1964, and The Americans with Disabilities
Act of 1990.
The firm will be paid at these rates:
Attorneys $215 to $525 per hour
Paraprofessionals $185 to $210 per hour
John Bagyi, Esq., a partner at Bond Schoeneck & King, 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:
John M. Bagyi, Esq.
Bond Schoeneck & King, PLLC
22 Corporate Woods Blvd., Ste. 501
Albany, NY 12211-2503
Tel: (518) 533-3000
About The Roman Catholic Diocese of Albany
The Roman Catholic Diocese of Albany is a religious organization in
Albany, N.Y. It covers 13 counties in Eastern New York, including a
portion of a 14th county. Its Mother Church is the Cathedral of the
Immaculate Conception in the city of Albany.
New York's Child Victims Act, which took effect in August 2019,
temporarily sets aside the usual statute of limitations for
lawsuits to give victims of childhood sexual abuse a year to pursue
even decades-old claims. Hundreds of new lawsuits have been filed
against churches and other institutions since the law took effect
on Aug. 14, 2019.
Facing the financial weight of new sexual misconduct lawsuits, at
least four of the eight Roman Catholic dioceses in the state, has
already sought Chapter 11 protection. The dioceses that have
declared bankruptcy include the Diocese of Rochester and the
Diocese of Rockville Centre on Long Island.
The Catholic Diocese of Albany sought relief under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. N.D.N.Y. Case No. 23-10244) on
March 15, 2023. In the petition filed by Fr. Robert P. Longobucco,
the Debtor estimated assets between $10 million and $50 million and
liabilities between $50 million and $100 million.
Judge Robert E. Littlefield, Jr. oversees the case.
The Debtor tapped Nolan Heller Kauffman, LLP as bankruptcy counsel;
Tobin and Dempf, LLP as special litigation counsel; and Keegan
Linscott & Associates, PC as financial advisor. Donlin, Recano &
Company, Inc. is the claims and noticing agent.
On April 17, 2023, the U.S. Trustee for Region 2 appointed two
separate committees to represent unsecured creditors and tort
claimants in the Debtor's Chapter 11 case. Lemery Greisler, LLC
represents the unsecured creditors' committee while Stinson, LLP
represents the tort committee.
DIV005 LLC: Ongoing Operations & Trust Proceeds to Fund Plan
------------------------------------------------------------
Div005 LLC and Metal Benders USA, LLC, submitted a Second Amended
Disclosure Statement for Joint Plan of Reorganization dated May 15,
2023.
The Plan contemplates the reorganization, consolidation, and
ongoing business operations of Debtors and the resolution of the
outstanding Claims against and Interests in Debtors pursuant to
sections 1129(b) and 1123 of the Bankruptcy Code. The Plan
classifies all Claims against and Interests in Debtors into
separate Classes.
DIV005 Creditors Trust and Litigation Trustee
On the Effective Date, the Plan shall establish a litigation trust
for the benefit of the Holders of Class 5 and Class 6 Unsecured
Claims (the "DIV005 Creditors Trust"). Div005, LLC and Metal
Benders USA, LLC shall execute the Trust Agreement ("Trust
Agreement") and it shall become effective on the Effective Date. In
accordance with the Trust Agreement, the DIV005 Creditors Trust
shall be administered by a Litigation Trustee, subject to Court
authorization, as the ("Litigation Trustee"). Subject to the Trust
Agreement, the Litigation Trustee shall serve from and after the
Effective Date until completion of their responsibilities.
The DIV005 Creditors Trust shall be established solely for the
purposes provided for in the Trust Agreement, which shall include,
without limitation, administering, maintaining, and ultimately
distributing the Trust Assets, and the proceeds received from
liquidation of the causes of action being brought as a
representative of the bankruptcy estate (collectively, the "Trust
Proceeds"). Such rights, powers, and duties granted to the
Litigation Trustee shall vest on the Effective Date without the
need to obtain further Court approval.
Except as explicitly provided in the Plan, the Debtor nor the
Reorganized Debtor shall have any liability for any cost or expense
of the DIV005 Creditors Trust except for payment of a $15,000.00
retainer to a forensic accountant mutually agreeable to the Debtor
and the Litigation Trustee. The Litigation Trustee shall distribute
the Trust Proceeds in accordance with the Trust Agreement and the
terms of the Plan.
To the extent that the Debtor or Winder Property Partners, LLC
asserts that such claim is encumbered by a lien or security
interest and an agreement cannot be reached with the Litigation
Trustee, the Bankruptcy Court shall retain jurisdiction to resolve
the dispute. The Reorganized Debtor shall make available to the
Litigation Trustee access during normal business hours, upon
reasonable notice, to personnel and books and records of the
Reorganized Debtor to enable the Litigation Trustee to perform the
Litigation Trustee's tasks under the Trust Agreement and the Plan.
Like in the prior iteration of the Plan, Debtors shall pay the
General Unsecured Creditors equal annual pro-rata payments in a
total amount of $600,000. The holders of Class 5 Claims are
impaired.
The source of funds for the payments pursuant to the Plan is a
contribution of new value by the Debtor's owners pursuant to Class
7, on-going operations of the Debtors and any recoveries of the
Litigation Trust.
A full-text copy of the Second Amended Disclosure Statement dated
May 15, 2023 is available at https://bit.ly/3BIXCGm from
PacerMonitor.com at no charge.
Attorneys for the Debtor:
Cameron M. McCord, Esq.
Thomas T. McClendon, Esq.
JONES & WALDEN, LLC
699 Piedmont Avenue, NE
Atlanta, GA 30308
Tel: (404) 564-9300
About Div005, LLC
Div005, LLC, is primarily engaged in manufacturing iron and steel
pipe and tube, drawing steel wire, and rolling steel shapes, from
purchased steel.
Div005, LLC sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. N.D. Ga. Case No. 22-21202) on Nov. 23,
2022. In the petition signed by Harold Lerner, manager, the Debtor
disclosed up to $50,000 in assets and up to $10 million in
liabilities.
Metal Benders USA LLC filed its voluntary petition for relief under
Subchapter V of Chapter 11 of the Bankruptcy Code (Bankr. N.D. Ga.
Case No. 22-21201) on Nov. 23, 2022. The Debtor estimated up to
$50,000 in assets and $1 million to $10 million in liabilities.
Gary M. Murphey has been appointed as Subchapter V trustee.
Cameron M. McCord, Esq., at Jones & Walden, LLC, serves as the
Debtors' counsel.
ELDAN LLC: Continued Operations to Fund Plan Payments
-----------------------------------------------------
Eldan, LLC, filed with the U.S. Bankruptcy Court for the District
of Nevada a Disclosure Statement describing Plan of Reorganization
dated May 15, 2023.
The Debtor is a Nevada limited liability company that owns an
improved piece of real estate, located at 5875 South Rainbow Blvd.,
in Las Vegas, Nevada (the "Property") and is operated as an office
building where separate suites are leased to third party tenants to
provide income to meet the debts of the estate.
The secured Property consists of one (1) parcel of improved real
property that is operated as leased office space (the "Eldan
Property"). Debtor holds the Property in fee simple with 100%
interest in the Eldan Property. The Eldan Property has been
appraised at $7,000,000. Debtor has no business operations beyond
the holding and management of the Eldan Property. The Debtor has no
current employees.
At the time of the filing of the bankruptcy petition, Debtor was
involved in litigation with LOA in the Clark County District Court,
Eighth Circuit, Case No. A-19-798172-C. The Debtor was involve in
separate litigation with Eli Elezra, Clark County District Court,
Eighth Judicial District Court. The bankruptcy was filed to avoid a
potential foreclosure by the second mortgage company LOA.
The Debtor plans to reorganize its business affairs by an infusion
of new money from an insider, Daniel Itzhaki.
Debtor estimates that the infusion of new money from Daniel Itzahki
and the ongoing operations income from the leases will provide
sufficient income to satisfy the outstanding creditor's claims
entirely. All proceeds will be allocated to pay priority and
secured tax debts upon the approval of the Plan of Reorganization.
Subsequent to payment in full of all administrative and secured
creditor claims, remaining new money proceeds will be distributed
to satisfy any unsecured claims prior to any distribution to the
equity holders.
The Debtor intends to continue to retain Omniterra, to manage the
marketing and leasing of the real property. Omniterra will be paid
a management fee of $2,500 per month plus commissions on new
leases. All new money will be designated to pay all creditors at
the close of escrow, and operating income will be used to satisfy
all remaining approved debt in its entirety.
Per the Operating Agreement. After the payment of all Class 1-4
claims, the remaining proceeds of operations will be distributed
under the Operating Agreement of Eldan, LLC to the equity holders
of the Debtor pursuant to their interests. The Debtor does not
intend to liquidate the assets of the estate.
Class 4 consists of General Unsecured Claims. Class 3 claims
consist of capital investments made by the investing beneficiaries
of the Debtor, including the disputed claim of Eliahu Elezra, who
asserts a claim of $5,961,687.68 based upon his initial investment
into the Debtor. However, Elezra also received the majority of the
loan proceeds through direct payment of gambling debts. The payment
of the loans by the Debtor resulted in forfeiture of equity holding
in 2013. Elezra asserts a claim in the adversary that he was
improperly removed as an equity holder of 50%.
To the extent that Elezra's claim Is valid, he would be classified
as an insider and would be subject to subrogation until all other
unsecured creditors have been paid in full. Elezra's equity
interest was forfeited and removed in 2018 under the Amended
Operating Agreement based upon a stated deadline for payment of the
loans by Elezra. To the extent that the Debtor's position is valid,
Elezra will not have a valid claim. There are no other know claim
holders that do not have insider affiliated status. General
unsecured claims amount to approximately $0 in undisputed claims.
After payment of the Class 1 claims, the general unsecured
creditors will be paid 100% of their allowed claim. Each Class 4
claimants receive a vote to either accept or reject the Plan,
unless there is an objection to their claim.
Class 5 consists of equity holding members of the Debtor limited
liability company. The members initially invested into the purchase
and improvement of the real property in the estate. Equity Holders
are members of the Debtor and will be subordinated as insiders to
the other creditor Classes 1-3. Class 5 will receive a pro rata
distribution of operating proceeds after Classes 1-4 have been paid
in the ordinary course of business or paid in full and all
administrative allowed claims have been paid in full.
The Debtor will implement its Plan by having Omniterra serve as the
Plan Agent for payment of Claims pursuant to the Plan. The Plan
Agent will make the plan payments from the revenue that is
generated from the operation of Debtor assets in whole or in part.
The real property value held by the estate is estimated at
$7,000,000 pursuant to a recent appraisal. The leasing costs and
other expenses of operating and leasing the Property will be paid
from the leasing proceeds through the confirmed plan period. The
expected net revenue from the leasing of the Property is
anticipated to be sufficient to pay all allowed claims 100%.
Debtor has approximately $10,000 in cash reserves. This reserve is
accumulated from the ongoing business revenue and will be used to
pay for administrative expenses upon confirmation. The plan
contemplates to use of the reserve funds to satisfy the initial
costs of the Plan at the Effective Date and to replenish this
reserve from the monthly income.
A full-text copy of the Disclosure Statement dated May 15, 2023 is
available at https://bit.ly/436gfPS from PacerMonitor.com at no
charge.
Attorney for Debtor:
Timothy P. Thomas, Esq.
Law Office of Timothy Thomas, LLC
1771 E. Flamingo Rd. B-212
Las Vegas, NV 89119
Tel: (702) 227-0011
Email: tthomas@tthomaslaw.com
About Eldan LLC
Eldan, LLC is a single asset real estate (as defined in 11 U.S.C.
Section 101(51B)). It is the fee simple owner of a commercial
property located at 5875 S. Rainbow, Las Vegas, having an appraised
value of $7 million.
Eldan filed its voluntary petition for relief under Chapter 11 of
the Bankruptcy Code (Bankr. D. Nev. Case No. 22-10589) on Feb. 21,
2022, listing $7,392,463 in assets and $3,623,919 in liabilities.
Daniel Itzhaki, managing member, signed the petition.
Judge August B. Landis oversees the case.
Christopher P. Burke, Esq., at The Law Office of Christopher P.
Burke serves as the Debtor's legal counsel.
ENVISION HEALTHCARE: $1B Bank Debt Trades at 91% Discount
---------------------------------------------------------
Participations in a syndicated loan under which Envision Healthcare
Corp is a borrower were trading in the secondary market around 8.7
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $1 billion facility is a Term loan that is scheduled to mature
on March 31, 2027. The amount is fully drawn and outstanding.
Envision Healthcare Corporation provides health care services. The
Hospital offers surgery, pharmacy, medical imaging, emergency care,
and other related health care services. Envision Healthcare serves
patients in the United States.
ERBO PROPERTIES: Unsecureds Will Get 100% of Claims in Sale Plan
----------------------------------------------------------------
ERBO Properties, LLC and its affiliates filed with the U.S.
Bankruptcy Court for the Southern District of New York a Disclosure
Statement to accompany Joint Consolidated Plan of Reorganization
dated May 15, 2023.
Erbo is a New York limited liability company and is the fee owner
of the Property. The Property is an eight-story building which was
built in 1915.
In 1995, Erbo leased much of the Property to a single tenant who
occupied the space until mid-2016. As the real estate market
changed in the West Chelsea neighborhood of Manhattan and with the
development of the High Line, Erbo after consulting with others,
decided to reposition the Property and embark on a project to
redevelop the Property into a first-class modern office building.
The Property consists of approximately 65,000 sq. ft.
In connection with the Mezzanine Loan, Gold Mezz and Kova were
created. These two entities had no business operations other than
the ownership interests in Erbo. The Mezzanine Loan was secured by
100% of the Equity Interests in Kova which in turn owns 100% of the
Equity Interests in Erbo.
In or about October 2022, SME issued a default letter to Gold Mezz
and scheduled a UCC sale for January 16, 2023 (the "UCC Sale"). The
UCC Sale was postponed until February 14, 2023, to enable the
parties to attempt to reach a consensual resolution. When the
parties were unable to reach a resolution, Erbo, Gold Mezz and
Kova, each filed Chapter 11 petitions on February 13, 2023, which
automatically stayed the UCC Sale.
The Plan is premised upon Erbo completing construction of the
Property and marketing and selling the Property either vacant or
leased no later than 24 months from the Effective Date. From the
Sale Proceeds, all holders of Allowed Claims asserted against any
of the Debtors, shall be paid the full amount of their Allowed
Claims (unless agreed otherwise) plus applicable post-Confirmation
interest.
The Plan is also premised on the substantive consolidation of
Erbo's Chapter 11 estate with the estates of Kova and Gold Mezz. In
short, regardless of which of the Debtors, a particular Creditor
may hold a Claim against, all assets of the Debtors shall be
pooled, and holders of Allowed Claims shall be paid from the Sale
Proceeds.
Class 6 consists of the holders of Allowed Unsecured Claims.
Allowed Class 6 Claims (including any Deficiency Claim held by G-4
and/or Holders of Class 3 Claims) shall be paid 100% of their
Allowed Claims without interest no later than 2 years from the
Effective Date from the Sale Proceeds. The Debtors project the
amount of Allowed Class 6 General Unsecured Claims will be
approximately $2 million excluding any Deficiency Claims.
Class 7 consists of Erbo's sole Equity Interest Holder is Kova.
Kova's sole Equity Interest Holder is Gold Mezz. Gold Mezz is owned
by the Bodek Family. There will be no Distribution to any of the
Equity Interests Holders unless the Property is sold for a price
greater than the amount of all Allowed Claims in Classes 1 through
6. The Equity Interests in the Reorganized Debtors (as
substantively consolidated) shall be pledged to SME in place of
SME's pledge of Kova's Equity Interest.
The Plan will be funded primarily via the Sale of the Property.
Pending the Sale of the Property, the Bodek Family shall either
contribute the monies necessary to pay for the remaining
construction costs and carrying costs on the Property pending the
stabilization and Sale or seek to obtain exit financing in the
nature of debtor-in-possession loan to fund these costs.
A full-text copy of the Disclosure Statement dated May 15, 2023 is
available at https://bit.ly/3BHcnJE from PacerMonitor.com at no
charge.
Attorneys for Debtors:
Scott S. Markowitz, Esq.
Alex Spizz, Esq.
Rocco A. Cavaliere, Esq.
Jill Makower, Esq.
Tarter Krinsky & Drogin LLP
1350 Broadway, 11th Floor
New York, NY 10018
Telephone: (212) 216-8000
Email: smarkowitz@tarterkrinsky.com
aspizz@tarterkrinsky.com
rcavaliere@tarterkrinsky.com
jmakower@tarterkrinsky.com
About ERBO Properties
ERBO Properties, LLC is a Single Asset Real Estate (as defined in
11 U.S.C. Sec. 101(51B)). It is the owner of a property located at
541 West 21st St., New York, valued at $80 million.
ERBO Properties and affiliates, Gold Mezz, LLC and Kova 521, LLC,
sought Chapter 11 bankruptcy protection (Bankr. S.D.N.Y. Lead Case
No. 23-10210) on Feb. 13, 2023. In the petition filed by Erno
Bodek, manager, ERBO reported between $50 million and $100 million
in both assets and liabilities.
Judge Lisa G. Beckerman oversees the case.
Tarter Krinsky & Drogin LLP serves as the Debtors' bankruptcy
counsel.
ESCO LTD: Committee Seeks to Hire Cole Schotz as Local Counsel
--------------------------------------------------------------
The official committee of unsecured creditors of ESCO, Ltd. seeks
approval from the U.S. Bankruptcy Court for the District of
Maryland to employ Cole Schotz, P.C. as its local counsel.
The firm's services include:
(a) providing legal advice with respect to the Committee's
powers, rights, duties and obligations in the Chapter 11 case;
(b) providing legal advice and services regarding local rules,
practices and procedures including Fourth Circuit law;
(c) reviewing and commenting on proposed drafts of pleadings
to be filed with the Court;
(d) appearing in Court and at any meeting with the United
States Trustee or other parties in interest;
(e) providing legal advice and services on any matter on which
Kelley Drye may have a conflict or as needed based on
specialization; and
(f) performing all other legal services for and on behalf of
the Committee which may be necessary or appropriate.
The firm will be paid at these rates:
Members $485 to $1,200 per hour
Special Counsel $575 to $730 per hour
Associates $325 to $685 per hour
Paralegals $245 to $410 per hour
Litigation Support $380 to $405 per hour
In addition, the firm will receive reimbursement for out-of-pocket
expenses incurred.
Gary Leibowitz, Esq., a partner at Cole Schotz, 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:
Gary H. Leibowitz, Esq.
Cole Schotz P.C.
300 E. Lombard Street, Suite 1450
Baltimore, MD 21202
Tel: (410)528-2971
Fax: (410)528-9401
Email: gleibowitz@coleschotz.com
About ESCO Ltd.
ESCO, Ltd., a retailer of apparel and footwear, filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Md. Case No. 23-12237) on March 31, 2023. In the petition signed
by Stanley W. Mastil, chief restructuring officer, the Debtor
disclosed up to $50 million in both assets and liabilities.
The Debtor tapped Polsinelli PC as its bankruptcy counsel and
Gavin/Solmonese, LLC as chief restructuring officer (CRO). Stretto,
Inc. is the claims and noticing agent.
ESCO LTD: Committee Seeks to Hire Kelley Drye & Warren as Counsel
-----------------------------------------------------------------
The official committee of unsecured creditors of ESCO, Ltd. seeks
approval from the U.S. Bankruptcy Court for the District of
Maryland to employ Kelley Drye & Warren LLP as its counsel.
The firm's services include:
(a) providing legal advice with respect to the Committee's
powers, rights, duties and obligations in the Chapter 11 case;
(b) assisting and advising the Committee in its consultations
with the Debtor regarding the administration of the Chapter 11
case;
(c) assisting the Committee in reviewing and negotiating terms
for unsecured creditors with respect to (i) debtor in possession
financing and the use of cash collateral, (ii) any sale of the
Debtor's assets, including negotiating bid procedures and proposed
asset purchase agreements, (iii) the confirmation of a Chapter 11
plan, and (iv) other requests for relief which would impact
unsecured creditors;
(d) investigating the liens asserted by the Debtor's lenders
and any potential causes of action against the Debtor's lenders and
other parties in interest;
(e) advising the Committee on the corporate aspects of the
Debtor's reorganization or liquidation and the plan(s) or other
means to effect reorganization or liquidation that may be proposed
in connection therewith, and participation in the formulation of
any such plan(s) or means of implementing a reorganization or
liquidation, as necessary;
(f) making all necessary actions to protect and preserve the
estate of the Debtor for the benefit of unsecured creditors,
including the investigation of the acts, conduct, assets,
liabilities and financial condition of the Debtors, the
investigation of the prior operation of the Debtor's business and
the investigation and prosecution of estate claims, causes of
action and any other matters relevant to the Chapter 11 case;
(g) preparing on behalf of the Committee all necessary
motions, applications, complaints, answers, orders, reports, papers
and other pleadings and filings in connection with the Committee's
duties in the Chapter 11 case;
(h) advising and representing the Committee in hearings and
other judicial proceedings in connection with all necessary
motions, applications, objections and other pleadings and otherwise
protecting the interests of those represented by the Committee;
and
(i) performing all other necessary legal services as may be
required and authorized by the Committee that are in the best
interests of unsecured creditors.
The firm will be paid at these rates:
Partners $800 to $1,445 per hour
Special Counsel $480 to $935 per hour
Associates $500 to $865 per hour
Paralegals $270 to $865 per hour
James S. Carr, Partner $1,100 per hour
Sean T. Wilson, Senior Associate $735 per hour
In addition, the firm will be reimbursed for expenses incurred.
James Carr, Esq., a member of Kelley Drye & Warren, disclosed in a
court filing that his firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
James S. Carr, Esq.
Kelley Drye & Warren LLP
3 World Trade Center
175 Greenwich Street
New York, NY 10007
Telephone: (212) 808-7800
Facsimile: (212) 808-7897
Email: jcarr@kelleydrye.com
About ESCO Ltd.
ESCO, Ltd., a retailer of apparel and footwear, filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Md. Case No. 23-12237) on March 31, 2023. In the petition signed
by Stanley W. Mastil, chief restructuring officer, the Debtor
disclosed up to $50 million in both assets and liabilities.
The Debtor tapped Polsinelli PC as its bankruptcy counsel and
Gavin/Solmonese, LLC as chief restructuring officer (CRO). Stretto,
Inc. is the claims and noticing agent.
ESCO LTD: Committee Taps Berkeley Research as Financial Advisor
---------------------------------------------------------------
The official committee of unsecured creditors of ESCO, Ltd. seeks
approval from the U.S. Bankruptcy Court for the District of
Maryland to employ Berkeley Research Group, LLC, as its financial
advisor.
The firm will render these services:
a) analyze the Debtor's assets (tangible and intangible) and
possible recoveries to creditor constituencies under various
scenarios and develop strategies to maximize recoveries;
b) develop and issue periodic monitoring reports to enable the
Committee to evaluate effectively the Debtor's performance relative
to the going-out-of-business sale process;
c) advise and assist the Committee with respect to any
debtor-in-possession financing arrangements and/or the use of cash
collateral;
d) monitor liquidity and cash flows throughout this Case and
scrutinize cash disbursements on an on-going basis;
e) assist the Committee and Counsel in discussions and
negotiations with various creditor constituencies regarding case
resolution, including review and provide analysis of any filed plan
of reorganization and disclosure statement;
f) advise the Committee and Counsel in evaluating any court
motions, applications, or other forms of relief, filed or to be
filed by the Debtor, or any other parties in interest;
g) advise and assist the Committee in its assessment of the
Debtor's employee needs and related costs, including the
appropriateness of any proposed employee retention plan or
incentive plan;
h) assist Counsel in evaluating all purported lien claims by
creditors, including the validity and enforcement of such claims;
i) monitor Debtor's claims management process, including
analyzing proofs of claim;
j) advise the Committee in connection with any potential
claims and causes of action, including preference payments,
fraudulent conveyances, and other potential causes of action that
the Debtor's estate may hold against insiders and/or third
parties;
k) participate in meetings and discussions with the Committee,
the Debtor, and the other parties in interest and with their
respective professionals and attending court hearings as may be
required;
l) provide any expert reports and/or testimony as requested by
the Committee and Counsel; and
m) perform other matters as may be requested by the Committee
or Counsel from time to time, including: analyses that have not yet
been identified but as may be requested by the Committee and
Counsel, consistent with the role of a financial advisor.
The hourly rates of the firm's professionals are as follows:
Managing Directors $1,050 - $1,250
Associate Directors & Directors $810 - $990
Professional Staff $395 - $795
Support Staff $175 - $350
In addition, the firm will seek reimbursement for expenses
incurred.
Mackenzie Shea, a managing director at Berkeley Research Group,
disclosed in a court filing that his firm is a "disinterested
person" as that term is defined in Section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Mackenzie Shea
Berkeley Research Group, LLC
99 High Street, 27th Floor
Boston, MA 02110
Telephone: 617 218-4713
Email: MShea@thinkbrg.com
About ESCO Ltd.
ESCO, Ltd., a retailer of apparel and footwear, filed its voluntary
petition for relief under Chapter 11 of the Bankruptcy Code (Bankr.
D. Md. Case No. 23-12237) on March 31, 2023. In the petition signed
by Stanley W. Mastil, chief restructuring officer, the Debtor
disclosed up to $50 million in both assets and liabilities.
The Debtor tapped Polsinelli PC as its bankruptcy counsel and
Gavin/Solmonese, LLC as chief restructuring officer (CRO). Stretto,
Inc. is the claims and noticing agent.
ESSY QUALITY: Court OKs Interim Cash Collateral Access
------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Texas, San
Antonio Division, authorized Essy Quality Health Care, LLC to use
cash collateral on an interim basis in accordance with the budget
and its agreement with the U.S. Small Business Administration.
The Debtor requires the use of cash collateral to continue its
operations.
The IRS asserts a security interest in all property of the Debtor
based upon pre-petition tax liens. The Small Business
Administration also asserts a perfected security interest in the
Debtor's property.
The IRS and the SBA may or may not have competing security
interests in the Debtor's assets and this order makes no ruling as
to the relative validity, priority or extent of any liens claimed
by the IRS or SBA.
Both the IRS and SBA are granted a priority replacement lien on all
inventory and accounts receivable acquired by the Debtor since the
filing of the petition and their liens are ratified and confirmed
as perfected under applicable federal law and the Bankruptcy Code
until further Court order or confirmation of a Plan of
Reorganization to the extent necessary to preserve the IRS and
SBA's statutory and contractual lien positions.
The Debtor will maintain insurance on all business assets and will
provide written evidence of same to the IRS, SBA and US Trustee.
The Debtor will maintain total minimum balances in its four bank
accounts in the amount of at least $20,000 as a means of providing
the IRS with adequate protection.
A final hearing on the matter is set for June 13, 2023 at 1:30
p.m.
A copy of the motion is available at https://bit.ly/42GCrk5 from
PacerMonitor.com.
About ESSY Quality Health Care, LLC
ESSY Quality Health Care, LLC is a home health care services
provider.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. W.D. Tex. Case No. 23-50442) on April 17,
2023. In the petition signed by Dozie Zogus Ony, managing member,
the Debtor disclosed up to $50,000 in assets and up to $10 million
in liabilities.
Judge Craig A. Gargotta oversees the case.
Michael J. O'Connor, Esq., at Michael J. O'Connor Law Office,
represents the Debtor as legal counsel.
EVOKE PHARMA: Five Proposals Passed at Annual Meeting
-----------------------------------------------------
Evoke Pharma, Inc. held its Annual Meeting solely by means of
remote communication through a live webcast on May 10, 2023, at
which the stockholders:
(1) elected Kenneth J. Widder, M.D. and David A. Gonyer, R. Ph.
as Class I directors for a term of three years expiring at the 2026
Annual Meeting of Stockholders;
(2) ratified the appointment of BDO USA, LLP as the Company's
independent registered public accounting firm for the year ending
Dec. 31, 2023;
(3) approved, on an advisory basis, the compensation of the
Company's named executive officers;
(4) approved the amendment and restatement of the Company's 2013
Equity Incentive Award Plan;
(5) approved the amendment and restatement of the Company's 2013
Employee Stock Purchase Plan;
(6) did not approve the Amendment to increase the authorized
number of shares of common stock from 50,000,000 to 100,000,000;
and
(7) did not approve the Amendment to update the exculpation
provision to include certain officers of the Company as permitted
by a recent amendment to Delaware law.
About Evoke Pharma
Headquartered in Solana Beach, California, Evoke Pharma, Inc. --
http://www.evokepharma.com-- is a specialty pharmaceutical company
focused primarily on the development of drugs to treat GI disorders
and diseases. The Company is developing Gimoti, a nasal spray
formulation of metoclopramide, for the relief of symptoms
associated with acute and recurrent diabetic gastroparesis in adult
women.
Evoke Pharma reported a net loss of $8.22 million for the year
ended Dec. 31, 2022, compared to a net loss of $8.54 million for
the year ended Dec. 31, 2021.
San Diego, California-based BDO USA, LLP, the Company's auditor
since 2014, issued a "going concern" qualification in its report
dated March 21, 2023, citing that the Company has suffered
recurring losses and negative cash flows from operations since
inception. These factors raise substantial doubt about the
Company's ability to continue as a going concern.
EXACTECH INC: $235M Bank Debt Trades at 46% Discount
----------------------------------------------------
Participations in a syndicated loan under which Exactech Inc is a
borrower were trading in the secondary market around 53.8
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $235 million facility is a Term loan that is scheduled to
mature on February 14, 2025. About $221.5 million of the loan is
withdrawn and outstanding.
Exactech, Inc. develops, manufactures, markets, and sells
orthopedic implant devices and related surgical instrumentation.
EYECARE PARTNERS: $300M Bank Debt Trades at 27% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Eyecare Partners
LLC is a borrower were trading in the secondary market around 73.1
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $300 million facility is a Term loan that is scheduled to
mature on November 15, 2029. The amount is fully drawn and
outstanding.
EyeCare Partners, LLC, headquartered in St. Louis, Missouri, is a
medically focused eye care services provider. EyeCare Partners is
vertically integrated, providing optometry, ophthalmology and
retail products.
EYECARE PARTNERS: $440M Bank Debt Trades at 24% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Eyecare Partners
LLC is a borrower were trading in the secondary market around 76.5
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $440 million facility is a Term loan that is scheduled to
mature on November 15, 2028. The amount is fully drawn and
outstanding.
EyeCare Partners, LLC, headquartered in St. Louis, Missouri, is a
medically focused eye care services provider. EyeCare Partners is
vertically integrated, providing optometry, ophthalmology and
retail products.
EYECARE PARTNERS: $750M Bank Debt Trades at 22% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Eyecare Partners
LLC is a borrower were trading in the secondary market around 78.5
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $750 million facility is a Term loan that is scheduled to
mature on February 20, 2027. The amount is fully drawn and
outstanding.
EyeCare Partners, LLC, headquartered in St. Louis, Missouri, is a
medically focused eye care services provider. EyeCare Partners is
vertically integrated, providing optometry, ophthalmology and
retail products.
FAIRPORT BAPTIST: PCO Says Patient Care Remains Stable
------------------------------------------------------
Eric Huebscher, the court-appointed patient care ombudsman, filed a
sixth report regarding the quality of patient care provided at the
nursing home operated by Fairport Baptist Homes and its affiliates.
In his report, which covers the period from March 7 to May 8, 2023,
the PCO visited the Debtors' site on two separate occasions. During
these visits, the PCO met with key employees and toured the
facility.
The PCO continued with weekly phone calls with the Debtors' senior
leadership. During these calls, the Debtors informed the PCO of any
material changes which may have had an impact on patient care. The
PCO has been irregularity updated on the sale process by both the
seller and the purchaser's representatives.
The PCO noted that the Debtors continued to maintain stable and
uninterrupted health services to their residents. The resident
census has been stable but far below the Debtors' full capacity.
The lowered census and resulting negative cashflow is of heightened
concern to the PCO. This is coupled with the uncertainty around if
or when New York State will review and approve the sale. The PCO
strongly encourages the Debtors to explore all available financing
alternatives and the PCO has communicated as such in phone calls
with Debtors' counsel and Debtors' financial representatives.
As of this report date, patient care has not been compromised and
remains stable.
A copy of the sixth PCO report is available for free at
https://bit.ly/41LIene from PacerMonitor.com.
About Fairport Baptist Homes
Fairport Baptist Homes and its affiliates, Fairport Baptist Homes
Adult Care Facility, Inc., FBH Community Ministries and FBH
Distinctive Living Communities, Inc., operate skilled nursing care
facilities.
Fairport Baptist Homes owns a New York-licensed 142-bed residential
health care facility at the FBH campus in Fairport, N.Y., and 42
independent living units known as Deland Acres.
On May 6, 2022, Fairport Baptist Homes and its affiliates sought
Chapter 11 bankruptcy protection (Bankr. W.D.N.Y. Lead Case No.
22-20220). In the petition filed by Fairport President Thomas H.
Poelma, Fairport Baptist Homes listed $1 million to $10 million in
assets and $10 million to $50 million in liabilities.
The Debtors tapped John A. Mueller, Esq., at Lippes Mathias, LLP as
bankruptcy counsel and Pullano & Farrow, PLLC as special counsel.
Epiq Corporate Restructuring, LLC is the claims and noticing
agent.
The U.S. Trustee for Region 2 appointed an official committee of
unsecured creditors in the Debtors' Chapter 11 cases on June 2,
2022. Dentons US, LLP and ToneyKorf Partners, LLC serve as the
committee's legal counsel and financial advisor, respectively.
Eric M. Huebscher, the patient care ombudsman appointed in the
Debtors' cases, is represented by Kelly C. Griffith, Esq., at
Harris Beach, PLLC.
FARADAY FUTURE: Posts $6.5 Million Net Income in First Quarter
--------------------------------------------------------------
Faraday Future Intelligent Electric Inc. has filed with the
Securities and Exchange Commission its Quarterly Report on Form
10-Q disclosing net income of $6.49 million for the three months
ended March 31, 2023, compared to a net loss of $153.10 million for
the three months ended March 31, 2022.
As of March 31, 2023, the Company had $575.29 million in total
assets, $318.90 million in total liabilities, and $256.38 million
in total stockholders' equity.
Faraday Future said, "The Company expects to continue to generate
significant operating losses for the foreseeable future. The plans
are dependent on the Company being able to continue to raise
significant amounts of capital through the issuance of additional
notes payable and equity securities.
"There can be no assurance that the Company will be successful in
achieving its strategic plans, that the Company's future funding
raises will be sufficient to support its ongoing operations, or
that any additional financing will be available in a timely manner
or on acceptable terms, if at all. If events or circumstances
occur such that the Company does not meet its strategic plans, the
Company will be required to reduce discretionary spending, alter or
scale back vehicle development programs, be unable to develop new
or enhanced production methods, or be unable to fund capital
expenditures. Any such events would have a material adverse effect
on the Company's financial position, results of operations, cash
flows, and ability to achieve its intended business objectives."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1805521/000162828023017931/ffie-20230331.htm
About Faraday Future
Gardena, CA-based Faraday Future (NASDAQ: FFIE) --
http://www.ff.com-- is a luxury electric vehicle company. The
Company has pioneered numerous innovations relating to its
products, technology, business model, and user ecosystem since
inception in 2014. Faraday Future aims to perpetually improve the
way people move by creating a forward-thinking mobility ecosystem
that integrates clean energy, AI, the Internet.
Faraday Future reported a net loss of $552.07 million for the year
ended Dec. 31, 2022, a net loss of $516.50 million for the year
ended Dec. 31, 2021, compared to a net loss of $147.08 million for
the year ended Dec. 31, 2020.
New York, NY-based Mazars USA LLP, the Company's auditor since
2022, issued a "going concern" qualification in its report dated
March 9, 2023, citing that the Company has incurred operating
losses since inception, has continued cash outflows from operating
activities, and has an accumulated deficit. These conditions raise
substantial doubt about its ability to continue as a going concern.
FILTRATION GROUP: Moody's Rates New Secured Term Loans 'B3'
-----------------------------------------------------------
Moody's Investors Service assigned a B3 rating to Filtration Group
Corporation's proposed senior secured (USD and Euro) term loans due
2028, which are part of an amendment that will extend the maturity
on the company's first lien term loans currently set to mature in
2025. The B3 rating on Filtration Group's existing debt facilities
remains unchanged.
Moody's will withdraw the B3 rating on the 2025 term loans upon
transaction close. Moody's also said Filtration Group's B3
corporate family rating and B3-PD probability of default are
unchanged at this time. The outlook is stable.
Assignments:
Issuer: Filtration Group Corporation
Backed Senior Secured First Lien Term Loans, Assigned B3
RATINGS RATIONALE
Filtration Group's ratings reflect its leading positions in niche
markets for filtration products used in various end market
applications, of which several (e.g. medical, bioscience, indoor
air quality and CO2 emission reduction) have good longer term
demand trends. The replacement/consumables aspect of the product
portfolio (about 80% of total sales) and modest capital
expenditures translate into solid and steady free cash flow. The
large recurring revenue base, combined with the relatively low
average price of filters and critical importance to customers'
overall systems and processes, reduces vulnerability to economic
down cycles.
However, Filtration Group has high financial leverage (about 6x),
owing to a history of debt funded acquisitions that have increased
its scale but also pose execution risks. The company's higher
margin life sciences business is facing weaker revenue as demand
for products related to COVID-19 moderates and due to inventory
de-stocking as supply chains normalize. The company is also
exposed to other cyclical markets and operates in a fragmented and
competitive landscape with larger players. Moody's expects pricing
actions and efficiency measures, along with continued focus on
realizing synergies from the Columbus Industries acquisition
(acquired in late 2021), to support a healthy adjusted EBITDA
margin around 20% into 2024.
The stable outlook reflects Moody's expectation that the company's
large recurring revenue base and sustainable demand in certain key
markets will help offset near term pressure in its life sciences
business and macroeconomic headwinds. This should support an
improvement in credit metrics, including leverage, over the next
year. Moody's also expects the company to maintain good liquidity.
Acquisitive growth will likely remain core to the longer-term
growth strategy in order to build out the company's capabilities in
its highly fragmented air and fluid filtration markets. However,
Moody's does not anticipate any meaningful debt funded transactions
in the near term.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The ratings could be downgraded with demonstration of aggressive
financial policies, including debt funded dividends or acquisitions
that weaken the metrics or liquidity. Debt-to-EBITDA expected to
remain at or above 6.25x or free cash flow-to-debt falling towards
the low single digits could also lead to a downgrade. A negative
rating action could also occur from a decline in revenue driven by
challenges in key end markets or increased competition from larger
competitors, or sustained margin erosion. The ratings could also
be downgraded with deteriorating liquidity.
The ratings could be upgraded with organic revenue growth in the
mid to high single digit range, greater free cash flow to enable
accelerated debt repayment and demonstrated improvement in
financial flexibility. Sustainable and meaningful margin expansion
would also be viewed favorably. Quantitatively, debt-to-EBITDA
expected to remain at or below 5.5x and free cash flow-to-debt of
7%-10% on a sustained basis could also support a ratings upgrade.
The principal methodology used in these ratings was Manufacturing
published in September 2021.
Filtration Group Corporation is a designer and manufacturer of
fluid and air filtration products to customers in medical &
bioscience, indoor air quality, CO2 emission reduction, food &
beverage and a variety of other end markets. Revenue for the twelve
months ended December 31, 2022, was nearly $2.1 billion.
The company is 85% owned by an affiliate of privately-held Madison
Industries, with the remaining 15% owned by management.
FIRST QUANTUM: Fitch Gives B+(EXP) Rating on New $1BB Unsec. Notes
------------------------------------------------------------------
Fitch Ratings has assigned Canada-based First Quantum Minerals
Ltd.'s (FQM; B+/Rating Watch Negative (RWN)) proposed USD1 billion
notes issue an expected 'B+(EXP)' senior unsecured rating. The
senior unsecured rating is on RWN. The Recovery Rating is 'RR4'.
The notes will be senior unsecured obligations of the company and
rank pari passu with FQM's existing senior unsecured notes.
Fitch expects gross debt to remain broadly unchanged following the
debt issue as proceeds will be used to repay USD750 million of the
drawn portion of FQM's existing revolving credit facility (RCF) and
redeem USD250 million of its outstanding 2025 notes.
Fitch placed FQM's ratings on RWN in January 2023 following a
dispute between FQM and the Panama government over the final terms
of a revised concession contract. Following a recent agreement
reached in principle between FQM and the Panamanian government,
Fitch expects to resolve the RWN once the agreement has been
formalised.
Fitch will assigns a final rating to the issue upon receipt of
final documentation conforming to information already received.
KEY RATING DRIVERS
Cobre Panama Fully Operational: Fitch sees sharply reduced risk of
disruption to operations at Cobre Panama following an agreement in
March 2023 between the Panamanian government and FQM's subsidiary,
Minera Panama S.A (MPSA), over the terms of the revised concession
contract. After a brief period of disrupted operations in 1Q23 due
to the government blocking concentrate loading at the mine's port,
Cobre Panama is now fully operational and a reversal of the care
and maintenance order from the government is expected.
Finalisation of Contract in Process: Fitch understands from
management that the draft concession contract has undergone a
public consultation process and will next be submitted to the
government for its approval. Following this, the contract will be
passed into law by the Panamanian parliament later this year. The
terms of the draft contract are in line with what the company
announced before and include a USD375 million minimum annual
payment comprising corporate taxes and a profit-based royalty of
12%-16%, with downside protections.
Financial Profile Remains Robust: Fitch forecasts EBITDA gross
leverage of around 2x for 2023, down from 2.7x in 2022 and well
within negative sensitivities for the rating. Fitch expects
leverage metrics to be driven lower this year by early repayments
of outstanding notes and projected EBITDA of over USD3.5 billion
due to still solid copper prices (despite recent moderation) and
continued ramp-up of volumes at Cobre Panama.
FQM's proposed notes will not increase the debt quantum as proceeds
will be used to repay upcoming maturities, while extending the
company's maturity profile. FQM is targeting USD1 billion of
further net debt reduction in the medium term.
Key Mining Asset: Cobre Panama is fundamental to both the economy
of Panama and FQM's operational and financial profile. The mine
accounted for just under half of FQM's EBITDA and 43% of its copper
production in 2022. It has also helped FQM achieve material
geographic diversification beyond Zambia (RD; Country Ceiling of
B-), which before Cobre Panama's start-up generated 80% of total
copper production and earnings in 2018.
Cobre Panama represents up to 4% of Panama's GDP, the majority of
its export revenues, and employs 40,000 people, including direct
employees, contractors and indirect workers supporting the mine.
Applicable Country Ceiling Unlikely to Change: Given FQM's
diversification of earnings from several jurisdictions, Fitch
applies a multiple-countries approach to determine the applicable
Country Ceiling for FQM, in this case Panama's at 'A-'. In an
unlikely scenario where the contract is not finalised and
operations disruption recurs, Fitch estimates that even only six
months of cash flows from Cobre Panama would cover hard-currency
gross interest expense, which would support the applicability of
Panama's Country Ceiling of 'A-'.
DERIVATION SUMMARY
FQM's peers include copper producers Freeport-McMoRan Inc.
(BBB-/Positive), Hudbay Minerals Inc. (BB-/Stable) and precious
metals producers like Endeavour Mining plc (BB/Stable).
FQM and Freeport both focus on copper and are among the top 10
global producers. FQM is smaller with production of 776,859 tonnes
in 2022 compared with Freeport's 1.9 million tonnes. FQM's
medium-term cost position is in the third quartile while Freeport's
assets on average are placed below the 50th percentile due to
low-cost operations at its Grasberg mine.
Freeport benefits from wider diversification across geographies
with a more stable operating environment and more sizable assets
with longer reserve life. Freeport's medium-term debt/EBITDA is
below 2.0x.
Currently FQM has a stronger business profile than Hudbay due to a
much larger scale, longer reserve life and lower cost position.
However, Hudbay operates in the lower-risk jurisdictions of Canada
and Peru, and has some commodity diversification. Fitch expects
Hudbay's debt/EBITDA to remain below 2.5x, although leverage may
increase depending on the investment decision on its new Rosemont
project in the US.
Endeavour Mining, a gold miner in west Africa, is smaller than FQM
(assuming current scale) but with a better cost position in the
second quartile. Operations are spread across three countries,
Senegal (about 45% of mine FCF), Cote d'Ivoire (about 20%) and
Burkina Faso (about 35%). Burkina Faso has a very weak operating
environment with many challenges, including security.
Endeavour's rating balances its strong financial and business
profiles, including a conservative financial policy of maintaining
net debt/EBITDA below 0.5x through the cycle, with a weaker
operating environment, reflecting the group's focus on west African
countries across Senegal, Burkina Faso and Cote d'Ivoire. The
applicable Country Ceiling is Cote d'Ivoire's 'BB'.
KEY ASSUMPTIONS
- Copper price at USD8,800/tonne in 2023, USD8,000/tonne in 2024
and 2025, and USD7,000/tonne in 2026; gold price at USD1,700/oz in
2023, USD1,600/oz in 2024 and 2025 and USD1,300/oz in 2026; nickel
at USD22,000/tonne in 2023, USD19,000/tonne in 2024,
USD17,000/tonne in 2025 and USD15,000/tonne in 2026
- Production in line with guidance provided by the company
- Capex in line with guidance provided by the company
- Forecast dividends to 2026 in line with public dividend policy
- No large debt-funded acquisitions over the next four years
- Existing royalties in Panama replaced by a minimum tax
contribution of USD375 million payable in its forecast
- No changes in the tax regime in Zambia to 2026
KEY RECOVERY ANALYSIS ASSUMPTIONS
The recovery analysis assumes that FQM would be considered a going
concern in bankruptcy and that it would be reorganised rather than
liquidated.
The going-concern EBITDA estimate reflects Fitch's view of a
sustainable, post-reorganisation EBITDA upon which Fitch bases the
valuation of the company. Its going-concern EBITDA estimate of USD2
billion assumes a sharp drop in copper prices followed by a
moderate recovery.
An enterprise value/EBITDA multiple of 4.5x was used to calculate
the post-reorganisation enterprise value, which factors in FQM's
scale, growth prospects and exposure, albeit decreasing, to
Zambia.
FQM's senior secured RCF is assumed to be fully drawn.
Secured debt reflected in the waterfall comprised a combined USD2.7
billion RCF and a term-loan bank facility, and a USD1 billion
streaming agreement with Franco-Nevada related to the Cobre Panama
project (at March 2023).
Senior unsecured debt reflected in the waterfall was USD4.3 billion
consisting of bonds and a USD423 million FQM Trident term loan (at
March 2023).
After deducting 10% for administrative claims and taking into
account Fitch's Country-Specific Treatment of Recovery Ratings
Criteria, its analysis resulted in a waterfall-generated recovery
computation (WGRC) in the 'RR4' band, indicating an expected
'B+(EXP)' instrument rating. The WGRC output percentage on current
metrics and assumptions was 50%.
RATING SENSITIVITIES
Factors That Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade:
- The ratings are on RWN, and Fitch, therefore, does not expect a
positive rating action at least in the short term. However, a
revised concession contract to secure Cobre Panama's future
operations with final terms that are in line with its expectations,
along with a record of stable operations, could lead to a removal
of RWN and the affirmation of the rating and the assignment of a
Stable Outlook
Factors That Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade:
- A significant reduction in the diversification of earnings caused
by material and protracted disruption to operations in Panama
- FFO gross leverage sustained above 4.0x (debt/EBITDA above 3.5x)
- Failure to maintain positive FCF
- Debt-funded acquisitions or higher-than-expected capex leading to
a material impact on the financial profile
- Signs of a deteriorating operating environment in Zambia
LIQUIDITY AND DEBT STRUCTURE
Adequate Liquidity: At end-March 2023, FQM's unrestricted cash
balances amounted to USD1.1 billion and the company had available
USD105 million of a committed undrawn RCF (with maturity in October
2025), providing ample liquidity to cover current maturities.
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
----------- ------ --------
First Quantum
Minerals Ltd.
senior
unsecured LT B+(EXP) Expected Rating RR4
FMC TECHNOLOGIES: Egan-Jones Retains B Senior Unsecured Ratings
---------------------------------------------------------------
Egan-Jones Ratings Company on May 5, 2023, maintained its 'B'
foreign currency and local currency senior unsecured ratings on
debt issued by FMC Technologies Inc. EJR also withdraws 'A2' rating
on commercial paper issued by the Company.
Headquartered in Houston, Texas, FMC Technologies Inc. FMC
Technologies, Inc. provides oilfield services and equipment.
FOREST CITY: $1.24B Bank Debt Trades at 21% Discount
----------------------------------------------------
Participations in a syndicated loan under which Forest City
Enterprises LP is a borrower were trading in the secondary market
around 79.3 cents-on-the-dollar during the week ended Friday, May
19, 2023, according to Bloomberg's Evaluated Pricing service data.
The $1.24 billion facility is a Term loan that is scheduled to
mature on December 7, 2025. About $890 million of the loan is
withdrawn and outstanding.
Forest City Enterprises, L.P. provides real estate services. The
Company develops, owns, acquires, and manages real estate
properties. Forest City Enterprises serves regional malls, retail
centers, office buildings, campuses, multi-family properties, and
residential communities in the United States.
FRANKLIN UNIVERSAL: Fitch Hikes Rating on Secured Notes From 'D'
----------------------------------------------------------------
Fitch Ratings has downgraded Franklin Universal Trust's (NYSE: FT)
senior secured note rating to 'D' from 'A' and subsequently
upgraded the rating to 'A' from 'D'.
KEY RATING DRIVERS
The temporary downgrade follows a missed interest payment on the
notes on March 15, 2023. The missed payment was rectified two days
after the expiry of a five-business day grace period provided for
in the notes' governing documents and therefore resulted in an
event of default. The late payment was the result of an
administrative error by the fund's investment advisor, Franklin
Advisers, Inc. (Franklin).
The subsequent upgrade reflects the payment of all interest amounts
due under the notes' governing documents including interest due at
a default rate; sufficient asset coverage provided to the notes by
the underlying portfolio of assets at the 'A' rating level; the
structural protections afforded by mandatory collateral maintenance
and deleveraging provisions in the event of asset coverage
declines; the legal and regulatory parameters that govern the
fund's operations; and the capabilities of Franklin as investment
advisor, including certain changes Franklin has made to its
operational procedures in an effort to prevent the potential
recurrence of similar oversights.
FUND PROFILE
FT is a diversified, closed-end management investment company,
registered under the Investment Company Act of 1940, as amended,
that commenced investment operations in September 1988. The fund's
primary investment objective is high current income consistent with
preservation of capital. The fund's secondary investment objective
is growth of income through dividend increases and capital
appreciation.
Under normal circumstances, the fund invests primarily in high
yield bonds and utility stocks. The fund also invests to a lesser
extent in foreign equity securities and sovereign debt, in each
case U.S.-dollar-denominated.
LEVERAGE
As of the review date, effective leverage for FT was 25%. This
ratio measures a fund's structural leverage as a percentage of its
capital structure. FT's leverage was composed of $65 million of
notes.
SUBORDINATION AND REFINANCING RISK
FT leverages only with the rated notes so subordination risk is not
a relevant consideration.
Fitch believes there is minimal refinancing risk associated with
the rated notes. The Fitch overcollateralization (OC) test results
indicate the funds are sufficiently liquid to fully repay all of
their leverage within a 45- to 60-day exposure period, even during
a time of substantial market stress.
DERIVATIVES
FT does not currently use derivatives for hedging or speculative
purposes.
ASSET COVERAGE
As of March 31, 2023, the fund's asset coverage ratios for the
notes were in excess of the minimum asset coverage of 300% required
by the fund's governing documents.
As of March 31, 2023, the fund's asset coverage ratios, as
calculated in accordance with the Fitch total and net
overcollateralization at the 'A' rating level as outlined in
Fitch's criteria, were in excess of the 100% minimum asset coverage
guidelines required by the fund's governing documents.
STRUCTURAL PROTECTIONS
The fund's compliance with applicable Fitch OC and asset coverage
thresholds is tested periodically. The fund manager is expected to
cure any breach by altering the composition of the portfolio toward
assets with lower discount factors for Fitch OC Test breaches, or
by reducing leverage in a sufficient amount for all other breaches
within a pre-specified period consistent with Fitch criteria.
INVESTMENT MANAGER
Franklin, a subsidiary of Franklin Resources, Inc. acts as the
investment adviser to the fund. As of March 31, 2023, Franklin
Resources, Inc. managed approximately $1.4 trillion in assets under
management.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- An upgrade is not currently envisioned as the fund invests
largely in securities that are ineligible for credit at the 'AA'
rating level.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- The occurrence of future operational oversights that result in a
disruption of timely payment of amounts due under the note
documents or that Fitch believes are indicative of broader fund-
management weaknesses, could cause Fitch to downgrade or withdraw
the ratings. As mentioned, Franklin has made certain changes to its
operational procedures in an effort to prevent the potential
recurrence of similar oversights;
- The rating may be sensitive to material changes in the leverage
composition, portfolio credit quality or market risk of the fund's
assets, as described above. A material adverse deviation from Fitch
guidelines for any key rating driver could cause ratings to be
downgraded by Fitch;
- A material adverse deviation from Fitch guidelines for any key
rating driver could cause ratings to be downgraded by Fitch;
- The ratings could be downgraded if asset coverage cushions erode
as a result of market volatility, or if Fitch believes the assets
the fund invests in are unlikely to retain sufficient liquidity
and price stability at the current rating stress levels. Fitch
deems the level of future market value decline the funds would have
to experience to incur a sustained breach in Fitch OC Test coverage
as unlikely, as Fitch believes the funds would delever or alter the
portfolio composition toward lower discount factor assets to the
extent needed to cause the rated securities to maintain passing
Fitch OC Test margins at the assigned rating level.
SOURCES OF INFORMATION
The sources of information used to assess this rating were the
public domain and Franklin.
Entity/Debt Rating Prior
----------- ------ -----
Franklin
Universal Trust
355145B#9 LT D Downgrade A
355145B#9 LT A Upgrade D
GLOBAL FOOD: EUR245M Bank Debt Trades at 16% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Global Food
Solutions Sarl is a borrower were trading in the secondary market
around 83.6 cents-on-the-dollar during the week ended Friday, May
19, 2023, according to Bloomberg's Evaluated Pricing service data.
The EUR245 million facility is a Term loan that is scheduled to
mature on February 11, 2028. About EUR0 million of the loan is
withdrawn and outstanding.
Global Food Solutions is a progressive food service partner,
uniquely positioned to create affordable and inspired foods.
HALLMARK FINANCIAL: AM Best Cuts LT Issuer Rating to ccc-(Weak)
---------------------------------------------------------------
AM Best has downgraded the Long-Term Issuer Credit Rating
(Long-Term ICR) to "ccc-" (Weak) from "bb" (Fair) and associated
Long-Term Issue Ratings (Long-Term IRs) of Hallmark Financial
Services, Inc. (Hallmark Financial) [NASDAQ: HALL]. Concurrently,
AM Best has downgraded the Financial Strength Rating (FSR) to C++
(Marginal) from B++ (Good) and the Long-Term ICRs to "b+"
(Marginal) from "bbb" (Good) of the members of Hallmark Insurance
Group. In addition, AM Best has maintained the under review with
negative implications status of all Credit Ratings (ratings). These
companies' operations are headquartered in Dallas, TX, and
collectively referred to as Hallmark.
The ratings reflect Hallmark's balance sheet strength, which AM
Best assesses as weak, as well as its marginal operating
performance, limited business profile and marginal enterprise risk
management.
The rating downgrades follow Hallmark Financials 8-K filing on May
5, 2023, which states that an arbitration proceeding related to a
loss portfolio contract with DARAG Bermuda Ltd. and DARAG Insurance
Limited resulted in an interim final award that will result in a
loss to Hallmark, estimated to be in a range of $25 million to $35
million. This award, which impacts first-quarter 2023 results,
further weakens Hallmark's balance sheet, which previously had lost
26.4% of its surplus in 2022 due to continued adverse reserve
development in the group's retained and discontinued commercial
auto lines.
Hallmark Financial also has entered a partnership with an insurance
carrier, which will allow Hallmark to underwrite its policies on
this carrier's paper to accommodate insureds' requirements.
Furthermore, Hallmark Financial has been advised by Core Specialty
Insurance Holdings, Inc., which in October 2022 acquired Hallmark's
excess and surplus (E&S) lines operations, that it has concluded
the interim period during which it was issuing Hallmark policies in
respect of the E&S business and will now be issuing new and renewal
policies using its own insurance carrier subsidiaries and own
systems. Such policies were fully reinsured by a Core Specialty
insurance carrier subsidiary from the date of acquisition.
These events have led AM Best to lower the assessments of
Hallmark's balance sheet strength, business profile and enterprise
risk management. Operating performance remains assessed as
marginal. The weak balance sheet assessment primarily reflects the
significant decline in risk-adjusted capitalization as a result of
the arbitration decision. The limited business profile reflects
Hallmark's business mix that has become more concentrated from a
product offering perspective. Furthermore, the cost structure of
the remaining business is negatively impacted by the additional
expense associated with the aforementioned partnership. The
marginal assessment of Hallmark's enterprise risk management
reflects deficiencies in risk management and controls, specifically
as it relates to reserve and operational risks.
Hallmark's ratings have been maintained as under review with
negative implications as AM Best has not had the opportunity to
review the full interim final award document. The ratings will
remain under review until AM Best reviews the details of the
interim final award, the first-quarter 2023 financial statements of
Hallmark and revised financial projections.
AM Best previously downgraded and maintained the under review
status with negative implications on Hallmark's ratings on May 5,
2023 (see related press release). At the time of the rating action,
the result of the arbitration was not publicly available and AM
Best indicated that an adverse arbitration decision could result in
additional negative rating activity.
The FSR has been downgraded to C++ (Marginal) from B++ (Good) and
the Long-Term ICRs downgraded to "b+" (Marginal) from "bbb" (Good)
with the under review implications status maintained as negative
for the members of Hallmark Insurance Group:
American Hallmark Insurance Company of Texas
Hallmark Insurance Company
Hallmark Specialty Insurance Company
Hallmark County Mutual Insurance Company
Hallmark National Insurance Company
The following Long-Term IR has been downgraded with the under
review implications status maintained as negative:
Hallmark Financial Services, Inc.—
— to "ccc-" (Weak) from "bb" (Fair) on $50 million 6.25% senior
unsecured notes, due 2029
The following indicative Long-Term IRs for securities available
under the shelf registration have been downgraded with the under
review implications status maintained as negative:
Hallmark Financial Services, Inc.—
— to "ccc-" (Weak) from "bb" (Fair) on senior unsecured debt
— to "cc" (Very Weak) from "bb-" (Fair) on subordinated debt
— to "c" (Poor) from "b+" (Marginal) on preferred stock
HEALTHCHANNELS INTERMEDIATE: S&P Lowers ICR to 'CCC', Outlook Neg.
------------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on U.S.-based
HealthChannels Intermediate HoldCo LLC and its rating on the
company's first-lien debt to 'CCC' from 'B-'; the first-lien
recovery rating remains '3'. S&P also revised the outlook to
negative from stable.
S&P said, "Our negative outlook reflects our view that expected
revenue and EBITDA declines in 2023 and minimal cash flow
generation could amplify refinancing risk for the2025 term loan. It
also reflects the heightened risk of further debt repurchases below
par within the next 12 months, which we would likely view as
distressed exchanges.
"The downgrade reflects our expectations that HealthChannels may
struggle to refinance its $385 million first-lien term loan due in
April 2025 in a challenging operating and macro environment.
Although market conditions for many healthcare providers stabilized
following the impact of the COVID-19 pandemic, with emergency
department volumes returning to near pre-pandemic levels,
HealthChannels has not rebounded.
"The downgrade also reflects our expectation that the company will
continue to buy back debt below par, which we would view as
tantamount to default.The company recently repurchased a small
amount ($10.82 million total)of its $385 million senior secured
first-lien term loan due April 2025 in two open market
transactions. If the company repurchases additional debt below par
debt, we would likely consider them distressed given current
operating trends, trading levels and the cumulative value of the
repurchases, as lenders will receive materially less value than
originally promised.
"We view HealthChannels' liquidity as less than adequate, despite
its strong cash balance.The company did not extend its revolver in
April 2023, and we project minimal free cash flow generation over
the next year. While there is currently a significant cash balance
of about $88 million as of December 2022, we expect it to decline
as the company pursue debt repurchases. We also do not believe the
company can absorb low-probability adversities.
"Our negative outlook reflects our view that expected revenue and
EBITDA declines in 2023 and minimal cash flow generation could
amplify refinancing risk on HealthChannels' 2025 term loan. It also
reflects the heightened risk of further debt repurchases below par
within the next 12 months, which we would likely view as distressed
exchanges.
"We could lower the ratings on HealthChannels if the company
pursues additional below-par debt repurchases that deem as
distressed exchanges.
"We view an upgrade as unlikely during the next 12 months, given
the company's intent to repurchase additional debt below par and
its upcoming maturity. We could raise the rating if we no longer
view distressed exchanges as likely and the company successfully
refinances its term loan."
ESG credit indicators: E-2, S-2, G-3
S&P said, "Governance factors are a moderately negative
consideration in our credit rating analysis. Our assessment of the
company's financial risk profile as highly leveraged reflects
corporate decision-making that prioritizes the interests of the
controlling owners, in line with our view of the majority of rated
entities owned by private-equity sponsors. Our assessment also
reflects the generally finite holding periods and a focus on
maximizing shareholder returns."
HELIUS MEDICAL: Incurs $2.5 Million Net Loss in First Quarter
-------------------------------------------------------------
Helius Medical Technologies, Inc. has filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q disclosing a
net loss of $2.49 million on $111,000 of total revenue for the
three months ended March 31, 2023, compared to a net loss of $4.35
million on $190,000 of total revenue for the three months ended
March 31, 2022.
As of March 31, 2023, the Company had $13.75 million in total
assets, $7.69 million in total liabilities, and $6.07 million in
total stockholders' equity.
As of March 31, 2023, the Company had cash and cash equivalents of
$11.3 million. For the three months ended March 31, 2023, the
Company had an operating loss of $3.8 million, and as of March 31,
2023, its accumulated deficit was $153.6 million. For the three
months ended March 31, 2023, the Company had $0.1 million of net
revenue from the commercial sale of products.
Helius said, "The Company expects to continue to incur operating
losses and net cash outflows until such time as it generates a
level of revenue to support its cost structure. There is no
assurance that the Company will achieve profitable operations, and,
if achieved, whether it will be sustained on a continued basis.
These factors indicate substantial doubt about the Company's
ability to continue as a going concern within one year after the
date the financial statements are filed."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1610853/000155837023009398/hsdt-20230331x10q.htm
About Helius Medical
Helius Medical Technologies, Inc. -- http://www.heliusmedical.com
-- is a neurotech company focused on neurological wellness. Its
purpose is to develop, license or acquire non-invasive technologies
targeted at reducing symptoms of neurological disease or trauma.
Helius Medical reported a net loss of $14.07 million for the year
ended Dec. 31, 2022, compared to a net loss of $18.13 million for
the year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$17.28 million in total assets, $9.14 million in total liabilities,
and $8.15 million in total stockholders' equity.
Minneapolis, Minnesota-based Baker Tilly US, LLP, the Company's
auditor since 2022, issued a "going concern" qualification in its
report dated March 9, 2023, citing that the Company has recurring
losses from operations, an accumulated deficit, expects to incur
losses for the foreseeable future and requires additional working
capital. These are the reasons that raise substantial doubt about
their ability to continue as a going concern.
HOME POINT: Fitch Affirms 'B-' IDR, On Watch Positive
-----------------------------------------------------
Fitch Ratings has revised the Rating Watch to Positive from
Negative on Home Point Capital Inc. and its subsidiary Home Point
Financial Corporation's (collectively Home Point) Long-Term Issuer
Default Ratings (IDRs) of 'B-'. Fitch similarly placed the Rating
Watch Positive on Home Point's unsecured debt rating of
'CCC+'/'RR5'.
The rating actions follow the announcement that Mr. Cooper Inc.
(Mr. Cooper) has entered into a definitive agreement to acquire all
outstanding shares of Home Point for approximately $324 million in
cash. The Rating Watch Positive indicates Home Point's ratings
could be upgraded or affirmed at their current level following the
closing of the acquisition, which is expected to occur in the third
quarter of 2023.
As part of the transaction, Mr. Cooper will assume $500 million in
outstanding Home Point 5% senior notes, which are due in February
2026. Following the onboarding of Home Point customers and the
closing of the transaction, Mr. Cooper will shut down the remaining
Home Point operations.
KEY RATING DRIVERS
The Rating Watch Positive on Home Point reflects Fitch's view that
the purchase by Mr. Cooper could result in a stronger credit
profile for the combined entity than Home Point's current
standalone credit profile. The ultimate rating action will depend
on Fitch's assessment of Mr. Cooper, pro forma for the
acquisition.
Fitch does not currently rate Mr. Cooper, but believes it has a
stronger business profile given its market position and scale as a
top 10 servicer of U.S. agency mortgages and its growing
originations franchise. At March 31, 2023, Mr. Cooper's servicing
portfolio had an unpaid principal balance (UPB) of $853 billion, of
which $413 billion represented owned Mortgage Servicing Rights
(MSRs) and $440 billion represented subservicing MSRs, with another
$57 billion of acquisitions pending (excluding Home Point).
Mr. Cooper is not subject to material asset quality risks, as most
loans are U.S. government or agency eligible and sold shortly after
origination. However, it has exposure to repurchase or
indemnification claims from third parties under warranty
provisions, as well as an indirect impact from advancing
obligations on delinquent loans in its servicing portfolio. This is
mitigated by its focus on conventional conforming loans and lower
exposure to government loans. Delinquencies of 60 days or more in
the servicing portfolio were 2.4% at March 31, 2023; down 19 bps
from the prior quarter, which compares favorably with peers. Fitch
believes asset quality metrics will normalize with a weaker
macroeconomic backdrop.
Mr. Cooper's MSR asset is large relative to its equity (above 200%)
when compared with most mortgage peers, which subjects it to higher
sensitivity to changes in interest rates and MSR valuation
declines. This is partially mitigated by Mr. Cooper's target to
hedge up to 75% of its MSR exposure (currently closer to 60%) as
hedges are expected to offset the MSR valuation impacts on earnings
as well as capital and liquidity.
Earnings have been under pressure in the non-bank mortgage space
given the significant reduction in the origination volume in
response to rising rates. Mortgage servicing businesses have served
as a partial offset, given lower prepayment speeds and positive
valuation adjustments to MSRs. The significant sub-servicing
portfolio provides a source of consistent fee earnings for Mr.
Cooper, with low associated balance sheet demands, and
differentiates it from many of its mortgage peers. Mr. Cooper
reported a pre-tax operating profit of $110 million in 1Q23, which
was up from $82 million in the prior quarter.
Non-bank mortgage companies are heavily reliant on secured
borrowings for funding, including committed and uncommitted
warehouse facilities and MSR lines. However, Mr. Cooper's unsecured
funding level is above its peers (48%), which Fitch believes
provides enhanced funding flexibility in times of market stress.
Mr. Cooper will also assume $500 million of Home Point unsecured
notes when the transaction closes, which will increase the overall
quantum of debt, but also increase the unsecured component.
Fitch evaluates leverage on a debt-to-tangible equity and
debt-to-EBITDA basis, both at the corporate and consolidated level
(including non-recourse borrowings) and will need to consider the
impact of pending acquisitions on Mr. Cooper's leverage ratios and
where those may trend over time.
Fitch believes Mr. Cooper has an adequate liquidity profile given
available cash and borrowing capacity on its MSR facilities,
adjusted for borrowing base considerations. Servicing advance risk
is believed to be relatively contained, given the modest exposure
to Ginnie Mae servicing. Still, some of the pending acquisitions
are expected to be funded with cash, which might reduce liquidity
availability in the near term.
Home Point's unsecured debt rating is one notch below the Long-Term
IDR with a recovery rating of 'RR5', reflecting below average
recovery prospects given the subordination to substantial secured
debt in the capital structure, and a limited pool of unencumbered
assets mostly consisting of MSRs, which could have significant
valuation volatility.
RATING SENSITIVITIES
Factors that Could, Individually or Collectively, Lead to Negative
Rating Action/Downgrade
If the transaction fails to close, the ratings of Home Point could
be affirmed or downgraded depending on how the termination of the
transaction would impact Home Point's market position, strategic
direction and expected financial metrics.
Factors that Could, Individually or Collectively, Lead to Positive
Rating Action/Upgrade
Home Point's ratings could be upgraded upon transaction close if
Fitch believes Mr. Cooper has a stronger credit profile than Home
Point. The degree to which the ratings could potentially be
upgraded would be particularly influenced by insights gained into
Mr. Cooper's credit profile, adjusting for all pending
acquisitions.
DEBT AND OTHER INSTRUMENT RATINGS: RATING SENSITIVITIES
Home Point's unsecured debt rating is linked to the Long-Term IDR
and would be expected to move in tandem. That said, a material
change in the recovery prospects for the unsecured debt could
result in a change in the notching of the unsecured debt relative
to the IDR.
The ratings of Home Point Financial Corporation are equalized with
the ratings of Home Point Capital Inc. and would be expected to
move in tandem.
SUBSIDIARY AND AFFILIATE RATINGS: RATING SENSITIVITIES
The ratings of Home Point Financial Corporation are equalized with
the ratings of Home Point Capital Inc. given it is a wholly owned
subsidiary and represents substantially all of the parent's
assets.
ESG CONSIDERATIONS
Home Point Financial Corporation has an ESG Relevance Score of '4'
for Customer Welfare - Fair Messaging, Privacy & Data Security due
to its exposure to compliance risks that include fair lending
practices, debt collection practices, and consumer data protection,
which has a negative impact on the credit profile, and is relevant
to the ratings in conjunction with other factors.
Home Point Financial Corporation has an ESG Relevance Score of '4'
for Governance Structure due to its private equity ownership and
board effectiveness as they relate to protection of creditor and
shareholder rights, which has a negative impact on the credit
profile, and is relevant to the ratings in conjunction with other
factors.
Home Point Financial Corporation has an ESG Relevance Score of '4'
for Management Strategy due to uncertainty regarding long term
business strategy and the recent erosion of management depth, which
has a negative impact on the credit profile, and is relevant to the
ratings in conjunction with other factors.
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
Entity/Debt Rating Prior
----------- ------ -----
Home Point
Financial
Corporation LT IDR B- Rating Watch Revision B-
Home Point
Capital Inc. LT IDR B- Rating Watch Revision B-
senior
unsecured LT CCC+ Rating Watch On CCC+
IAMGOLD CORP: Fitch Affirms 'B-' Issuer Default Rating
------------------------------------------------------
Fitch Ratings has affirmed IAMGOLD Corporation's Issuer Default
Rating (IDR) at 'B-' and rated the new $400 million senior secured
second lien term loan 'B-'/'RR4'. Proceeds will be used to repay
borrowings under the secured revolving credit facility. Fitch has
also affirmed the ratings of the senior unsecured notes and secured
revolving credit facility at 'B-'/'RR4'. The Rating Outlook is
Stable.
The ratings and Outlook reflect the company's high cost position at
its mines currently in operation and elevated country risk exposure
given the majority of production is generated in Burkina Faso. The
ratings also reflect Fitch's expectation that completion and
ramp-up of the Cote project (Canada) will increase size, improve
the company's overall cost position and lower country risk. Fitch
expects EBITDA leverage to peak in 2023 at around 5.0x before
decreasing to levels commensurate with the ratings following first
production from the Cote mine in 2024.
KEY RATING DRIVERS
Cote Improves Operational Profile: The completion of Cote improves
overall size, scale, cost position, average mine life and country
risk. IAMGOLD will own 60% of the Cote gold project joint venture
(JV; 56% net interest in the project) if it transfers interests to
Sumitomo Metal Mining Co., Ltd. under the terms of the amended Cote
JV agreement. Cote is expected to begin production in 2024 and
achieve its first full year of production in 2024-2025 and have an
18-year mine life. Cote is expected to increase IAMGOLD's average
annual gold production by roughly 300,000 ounces compared with 2023
guidance for attributable production aggregating 410,000-470,000
ounces.
High Cost Position Mines: Fitch views IAMGOLD's high cost position
as partially offset by solid mine lives and the Cote gold project,
which will improve the company's overall cost position. Cote's
estimated life-of-mine average cash costs of $693/oz and all-in
sustaining cost of $854/oz according to the 2022 technical report
compare with a second quartile cost position, according to CRU's
2022 cost data.
According to CRU, IAMGOLD has a fourth quartile cost position at
its 90% owned Essakane mine (four-year mine life, 61% of 2022
attributable production, located in Burkina Faso) and a fourth
quartile cost position at its Westwood mine (10-year mine life, 9%
of 2022 attributable production, located in Canada). The fourth
quartile Rosebel mine in Suriname, accounting for 30% of 2022
attributable production, was sold for $360 million in February
2023.
Elevated Country Risk: Fitch views the rating as currently capped
at the 'B' level, given the majority of 2023 cash flow is expected
to be generated in Burkina Faso. Fitch does not rate Burkina Faso,
although believes it has significant country risk. Cote, located in
the low-risk mining-friendly jurisdiction of Canada (rated AA+),
will improve the company's operational profile and overall exposure
to high country risk. As Cote gets closer to full production, Fitch
would likely remove that cap since the EBITDA generated in Canada
would be sufficient to cover the company's interest expense.
DERIVATION SUMMARY
IAMGOLD is similar in terms of annual production to gold producer
Eldorado Gold (B+/Stable) although IAMGOLD has higher cost mines,
higher country risk, and shorter reserve life at currently
operating mines. In addition, Eldorado Gold will have five
operating mines once Skouries is completed compared to IAMGOLD's
three mines once Cote is complete. IAMGOLD is currently similarly
sized in terms of EBITDA to copper producers Ero Copper Corporation
(B/Stable) and Taseko Mines Limited (B-/Stable) with a similar cost
position to Taseko and a higher cost position than Ero Copper.
Fitch expects both IAMGOLD and Eldorado Gold to exceed leverage
sensitivities near term in advance of late stage development
projects completing but to de-leverage thereafter.
KEY ASSUMPTIONS
- Proceeds from the sale of development properties are received in
2023 as expected for cash proceeds of $282 million.
- Consolidated gold production of around 480,000 ozs. in 2023
increasing to about 800,000 ozs. in 2026, as Cote reaches full
production.
- Gold prices of $1,700/oz. in 2023; $1,600/oz. in 2024 and 2025;
and $1,300/oz. thereafter, adjusted for hedges.
- Capex of around $870 million in 2023 declining to around $300
million in 2024 and to about $150 million per year on average,
thereafter.
- Cote production beginning in 2024 and ramping up to full
production in 2025.
- IAMGOLD transfers 10% interest in Cote to Sumitomo Metal Mining
Co., Ltd. according to the amended JV agreement and repurchases in
November 2026.
Key Recovery Rating Assumptions
The recovery analysis assumes IAMGOLD would be reorganized as a
going-concern in bankruptcy rather than liquidated.
Fitch assumed a 10% administrative claim.
Going-Concern Approach
The going-concern (GC) EBITDA estimate of $295 million reflects
Fitch's view of a sustainable, post-reorganization EBITDA level
upon which Fitch bases the enterprise valuation (EV). The GC EBITDA
assumption reflects the industry's move from top of the cycle gold
prices to a sustainably lower gold price environment, which would
stress the capital structure.
An EV multiple of 4.0x EBITDA is applied to the GC EBITDA to
calculate a post-reorganization EV. The choice of this multiple
considered the high-cost position at IAMGOLD's mines currently in
operation and elevated country risk associated with Burkina Faso.
The multiple considers Cote's low-cost position and improved
country risk upon completion.
The revolver is assumed to be fully drawn upon default.
The allocation of value in the liability waterfall results in
recovery corresponding to 'RR1' for the first-lien revolver and
second lien term loan. However, per Fitch's Country-Specific
Treatment of Recovery Ratings Criteria, Burkina Faso, where the
majority of EBITDA is generated, is considered Group D, therefore,
Fitch caps the instrument's recovery ratings at 'RR4' resulting in
a rating of 'B-' for the first-lien secured revolver and second
lien term loan. The unsecured notes recover at 'RR4' resulting is a
'B-' rating.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Visibility completion of Cote which will result in an improved
cost position and lower country risk;
- Visibility into the financing of potential repurchase of
transferred interests in Cote;
- EBITDA leverage sustained below 3.5x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- EBITDA leverage sustained above 4.5x;
- Higher than expected negative FCF excluding Cote development
capital.
LIQUIDITY AND DEBT STRUCTURE
Solid Liquidity: Pro forma for the receipt of Rosebel proceeds and
the use of the proceeds from the new second lien term loan, IAMGOLD
had $784 million in cash on hand and about $425 million available
under its $490 million secured revolving credit facility due 2025.
FCF before Cote capex in 2023 is expected to be modestly positive
and $250 million of IAMGOLD's share of 2023 Cote capex is supported
by the amended JV agreement with Sumitomo Metals Mining Co., Ltd.
ISSUER PROFILE
IAMGOLD is a mid-tier gold mining company with two operating gold
mines: the Essakane mine in Burkina Faso and the Westwood mine in
Canada as well as a late stage development project, the Cote mine
in Canada.
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
----------- ------ -------- -----
IAMGOLD
Corporation LT IDR B- Affirmed B-
senior
unsecured LT B- Affirmed RR4 B-
senior secured LT B- Affirmed RR4 B-
Senior Secured
2nd Lien LT B- New Rating RR4
IMERYS TALC: Seeks to Hire Ramboll US as Environmental Advisor
--------------------------------------------------------------
Imerys Talc America, Inc. and its affiliates filed its second
supplemental application seeking approval from the U.S. Bankruptcy
Court for the District of Delaware expanding the scope of services
to be provided by Ramboll US Consulting, Inc. as their
environmental advisor.
Ramboll will provide the following supplemental services:
In order to (a) restore the functionality of the pit lake drainage
system outlined in the Hamm Proposal, (b) arrest water intrusion
into manholes in the Hamm Mine pit lake drainage system and (c)
dismantle and dispose of unneeded chemical treatment equipment,
Ramboll proposes to perform the following tasks:
Task 1 -- Initial Inspection of Site and Equipment Condition
Task 2 -- Manhole Sealing Oversight
Task 3 -- Manhole Sealing Execution
Task 4 -- Treatment System Components Removal
Task 5 -- Controls Engineering
Task 6 -- Instrumentation and Controls Equipment
Task 7 -- Installation, Startup and Commissioning
The firm will be paid at these hourly rates:
Principal 280
Principal Consultant 280
Sr. Managing Consultant 260
Managing Consultant 220
Senior Consultant 2 185
Senior Consultant 1 170
Consultant 3 145
Consultant 2 125
Consultant 1 105
Drafting 100
Support 85
As disclosed in the court filings, Ramboll is a "disinterested
person" as such term is defined under section 101(14) of the
Bankruptcy Code.
The firm can be reached through:
Eddie Arslanian
Ramboll US Consulting, Inc.
350 South Grand Avenue
Los Angeles, CA 90071
Tel: +1 213 943 6300
Fax: +1 213 943 6301
Email: EArslanian@ramboll.com
About Imerys Talc America
Imerys Talc America, Inc. and its subsidiaries --
https://www.imerys-performance-additives.com/ -- are in the
business of mining, processing, selling and distributing talc. Its
talc operations include talc mines, plants and distribution
facilities located in Montana (Yellowstone, Sappington, and Three
Forks); Vermont (Argonaut and Ludlow); Texas (Houston); and
Ontario, Canada (Timmins, Penhorwood, and Foleyet). It also
utilizes offices located in San Jose, Calif., and Roswell, Ga.
Imerys Talc America and its subsidiaries, Imerys Talc Vermont,
Inc., and Imerys Talc Canada Inc., sought Chapter 11 protection
(Bankr. D. Del. Lead Case No. 19-10289) on Feb. 13, 2019. The
Debtors were estimated to have $100 million to $500 million in
assets and $50 million to $100 million in liabilities as of the
bankruptcy filing.
Judge Laurie Selber Silverstein oversees the cases.
The Debtors tapped Richards, Layton & Finger, P.A., and Latham &
Watkins LLP as their legal counsel, Alvarez & Marsal North America,
LLC as financial advisor, and CohnReznick LLP as restructuring
advisor. Prime Clerk, LLC, is the claims agent.
The U.S. Trustee for Region 3 appointed an official committee of
tort claimants in the Debtors' Chapter 11 cases. The tort
claimants' committee is represented by Robinson & Cole, LLP.
INDIAN CANYON: Taps Fiore Racobs & Powers as Special Counsel
------------------------------------------------------------
Indian Canyon & 18th Property Owners Association seeks approval
from the U.S. Bankruptcy Court for the Central District of
California to employ Fiore Racobs & Powers as special counsel.
The Debtor needs the firm's legal assistance in connection with the
collection of delinquent assessments owed to it by its members.
The firm will be paid at these rates:
Attorneys $255 to $395 per hour
Paralegals/Law Clerks $155 per hour
Clerical Assistants $45 per hour
The Debtor paid a retainer of $1,000.
Erin Maloney, Esq., a partner at Fiore Racobs & Powers, 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:
Erin A. Maloney, Esq.
Fiore Racobs & Powers
74130 Country Club Dr., Ste 102
Palm Desert, CA 92260
Tel: (760) 776-6511
Fax: (760) 776-6517
About Indian Canyon
Indian Canyon & 18th Property Owners Association filed a petition
for relief under Subchapter V of Chapter 11 of the Bankruptcy Code
(C.D. Cal. Case No. 22-13378) on Sept. 6, 2022, with between $1
million and $10 million in assets and between $500,000 and $1
million in liabilities. Arturo Cisneros has been appointed as
Subchapter V trustee.
Judge Scott H. Yun oversees the case.
The Debtor tapped Douglas A. Plazak, Esq., at Reid &Hellyer as
bankruptcy counsel; Dinsmore&Shohl, LLP as litigation counsel; and
Fiore Racobs & Powers as special counsel.
INTEGRATED: Equity Holders Tap McCarter & English as Counsel
------------------------------------------------------------
The official committee of equity securities holders appointed in
the chapter 11 case of Integrated Nano-Technologies, Inc. seeks
approval from the U.S. Bankruptcy Court for the Western District of
New York to employ McCarter & English, LLP as its counsel.
The firm will render these services:
a. advise the Committee with respect to its rights, duties,
and powers in this Chapter 11 Case;
b. assist and advise the Committee in its consultations and
communications with the Debtor relative to the administration of
this Chapter 11 Case;
c. assist the Committee in analyzing the claims of the
Debtor's creditors and the Debtor's capital structure and in
negotiating with holders of claims;
d. assist the Committee in its investigation of the acts,
conduct, assets, liabilities, and financial condition of the Debtor
and of the operation of the Debtor;
e. assist the Committee in its investigation of the liens and
claims of the holders of the Debtor's prepetition debt and the
prosecution of any claims or causes of action revealed by such
investigation;
f. assist the Committee in its analysis of, and negotiations
with, the Debtor or any third party concerning matters related to,
among other things, asset dispositions, financing of other
transactions and the terms of any chapter 11 plans for the Debtor
and accompanying disclosure statements and related plan documents;
g. assist and advise the Committee as to its communications to
other equity securities holders regarding significant matters in
this Chapter 11 Case;
h. represent the Committee at hearings and other proceedings;
i. review and analyze applications, orders, statements of
operations, and schedules filed with the Court and advise the
Committee as to their propriety;
j. assist the Committee in preparing pleadings and
applications as may be necessary in furtherance of the Committee's
interests and objectives;
k. prepare, on behalf of the Committee, any pleadings,
including without limitation, motions, memoranda, complaints,
adversary complaints, objections, or comments in connection with
any of the foregoing as may be necessary in furtherance of the
Committee's interests and objectives in this Chapter 11 Case,
including without limitation, the preparation of retention
applications and fee applications for the Committee's
professionals, including McCarter & English; and
l. perform such other legal services as may be required or are
otherwise deemed to be in the interests of the Committee in
accordance with the Committee's powers and duties as set forth in
the Bankruptcy Code, Bankruptcy Rules, or other applicable law.
McCarter & English's reduced hourly rates for this matter are as
follows:
Partners $450 - $1,035
Associates $279 - $585
Paralegals $135 - $342
Gregory Mascitti, Esq., a partner of McCarter & English, disclosed
that his firm is a
"disinterested person" as that term is defined in section 101(14)
of the Bankruptcy Code, and does not represent or hold any interest
adverse to the interests of the Debtor's estates with respect to
the matters for which it is to be employed.
The firm can be reached through:
Gregory J. Mascitti, Esq.
McCarter & English, LLP
Worldwide Plaza
825 Eighth Avenue, 31st Floor
New York, NY 10019-7475
Tel. 212-609-6810
Fax. 212-935-1304
Email: gmascitti@mccarter.com
About Integrated Nano-Technologies
Integrated Nano-Technologies, Inc. is a company in Henrietta, N.Y.,
which offers scientific research and development services.
Integrated Nano-Technologies filed its voluntary petition for
Chapter 11 protection (Bankr. W.D.N.Y. Case No. 22-20611) on Dec.
22, 2022, with $100,000 to $500,000 in assets and $10 million to
$50 million in liabilities. Donald H. Noble, chief financial
officer, signed the petition.
Judge Warren oversees the case.
Jeffrey A. Dove, Esq., at Barclay Damon, LLP and Compass Advisory
Partners, LLC serve as the Debtor's legal counsel and investment
banker, respectively.
INTERPACE BIOSCIENCES: Posts $351K Net Income in First Quarter
--------------------------------------------------------------
Interpace Biosciences, Inc. has filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q disclosing
net income of $351,000 on $9.83 million of net revenue for the
three months ended March 31, 2023, compared to a net loss of $2.25
million on $7.92 million of net revenue for the three months ended
March 31, 2022.
"Q1 2023 represented record testing volume and net revenue for the
Company, resulting in achievement of profitability and exceeding
cash flow breakeven," stated Tom Burnell, president and CEO of
Interpace. "Continued adoption of the Company's proprietary
molecular diagnostics tests (ThyGeNEXT + ThyraMIRv2 and PancraGEN)
by physicians and medical professionals has fueled the growth
trajectory of the Company. This has set the stage for sales force
expansion, and investments in product improvements and laboratory
efficiency which may, initially, impact full year profitability."
As of March 31, 2023, the Company had $15.88 million in total
assets, $31.88 million in total liabilities, $46.54 million in
redeemable preferred stock, and a total stockholders' deficit of
$62.54 million.
Interpace said, "The Company may not generate positive cash flows
from operations for the year ending December 31, 2023. The Company
intends to meet its ongoing capital needs by using its available
cash and availability under the Comerica Loan Agreement, as well as
through targeted margin improvement; collection of accounts
receivable; containment of costs; and the potential use of other
financing options and other strategic alternatives. However, if
the Company is unable to meet the financial covenants under the
Comerica Loan Agreement, the revolving line of credit and notes
payable will become due and payable immediately. As of May 1,
2023, the Company had $2.2 million available under the Loan
Agreement.
"The Company continues to explore various strategic alternatives,
dilutive and non-dilutive sources of funding, including equity and
debt financings, strategic alliances, business development and
other sources in order to provide additional liquidity. With the
delisting of its common stock from Nasdaq in February 2021, and the
possible removal of its common stock from trading on the OTCQX if
it fails to meet minimum market capitalization of $5 million by
July 3, 2023, the Company's ability to raise additional capital on
terms acceptable to it has been adversely impacted. There can be
no assurance that the Company will be successful in obtaining such
funding on terms acceptable to it."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1054102/000149315223016658/form10-q.htm
About Interpace
Headquartered in Parsippany, NJ, Interpace Biosciences f/k/a
Interpace Diagnostics Group, Inc. -- http://www.interpace.com-- is
a company that provides molecular diagnostics, bioinformatics and
pathology services for evaluation of risk of cancer by leveraging
the latest technology in personalized medicine for improved
patient
diagnosis and management. The Company develops and commercializes
genomic tests and related first line assays principally focused on
early detection of patients with indeterminate biopsies and at high
risk of cancer using the latest technology.
Interpace Biosciences reported a net loss of $21.96 million in
2022, a net loss of $14.94 million in 2021, a net loss of $26.45
million in 2020, and a net loss of $26.74 million in 2019. As of
Dec. 31, 2022, the Company had $15.98 million in total assets,
$32.51 million in total liabilities, $46.53 million in redeemable
preferred stock, and a total stockholders' deficit of $63.07
million.
INW MANUFACTURING: $340M Bank Debt Trades at 21% Discount
---------------------------------------------------------
Participations in a syndicated loan under which INW Manufacturing
LLC is a borrower were trading in the secondary market around 79
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $340 million facility is a Term loan that is scheduled to
mature on May 7, 2027. The amount is fully drawn and outstanding.
INW Manufacturing, LLC is in the Vitamin, Nutrient, and Hematinic
Preparations for Human Use business.
JOURNEY PERSONAL: Moody's Alters Outlook on 'Caa2' CFR to Positive
------------------------------------------------------------------
Moody's Investors Service changed the outlook of Journey Personal
Care Corp. to positive from negative. Concurrently, Moody's also
affirmed the company's ratings including the Corporate Family
Rating at Caa2, Probability of Default Rating at Caa2-PD, and the
existing first lien term loan rating at Caa2.
The change to a positive outlook recognizes recent improvement in
Journey's financial performance with increased profitability and
improving liquidity despite a still challenging market environment.
The rating action further takes into consideration Moody's
expectation that over the next 12 months the company will continue
to expand its EBITDA and deleverage driven by consistent demand for
personal care adult incontinence and baby diapering products in
North America and Europe, as well as the company's ability to
realize margin improvement from previous price increases and
moderation of raw material costs. Additional benefits from the
pricing initiatives and cost savings implemented throughout 2022
have already begun to yield positive results. Moody's expects that
Journey will reduce debt-to-EBITDA leverage to about 9x on a
Moody's adjusted basis by the end of 2023 through improving
earnings and tight cost controls. However, further positive action
is dependent on generating sufficient EBITDA to support the
company's capital spending and debt service. Moody's expects free
cash flow to be slightly negative in 2023 and breakeven in 2024
creating reliance on the asset-based revolver.
Affirmations:
Issuer: Journey Personal Care Corp.
Corporate Family Rating, Affirmed Caa2
Probability of Default Rating, Affirmed Caa2-PD
Senior Secured Bank Credit Facility, Affirmed Caa2
Outlook Actions:
Issuer: Journey Personal Care Corp.
Outlook, Changed To Positive From Negative
RATINGS RATIONALE
Journey's Caa2 CFR continues to reflect the company's very high
Moody's adjusted debt-to-EBITDA leverage of 20x as of LTM Q1 2023
that is projected to decline to about 9x by the end of 2023. Still
negative EBITA/interest coverage that Moody's expects will improve
to a positive level but will remain below 1x over the next 12
months and adequate liquidity with limited free cash flow amid a
high interest rate environment. Moody's also anticipates the need
to return to a more robust capital investment over the next 24
months that will limit free cash flow. Journey's ability to take
pricing actions across the healthcare segment of its product
portfolio, which accounted for about half of revenue, is more
limited. Specifically, the company is reimbursed under healthcare
tenders, and negotiations outside of the contracted terms are
unusual. Journey's efforts are focused on pricing negotiations when
the contracts are up for renewal, which are expected to protect
gross profit margins going forward. The company is unlikely to
recover already absorbed loses. Management estimates that
approximately 20% to 30% of the healthcare contracts do not reflect
the updated cost structure. Moody's forecasts the EBITDA margin
will improve to a high-single digit range in 2023 as input costs
continue to moderate, although margins are expected to remain
significantly lower than historic averages. Moody's projects free
cash will be slightly negative to breakeven over the next 12
months, dependent on the interest rate environment stabilizing and
capital investment remaining modest.
The rating is supported by the company's good market position in
branded and private label products, which are sold in its
healthcare/institutional and direct to consumer segments. Demand
for the products is stable and recurring given the essential
nature. Journey will focus on increasing penetration in the adult
incontinence category as a source of growth given the growing
elderly population. The company is well diversified geographically
with revenue roughly split 50/50 between North America and Europe.
Liquidity is adequate, when considering projected negative free
cash flow and revolver availability. Journey's cash balance was
approximately $11 million as of March 2023, and the company had
about $65 million of availability under its $120 million
asset-based revolver. Journey also has about $13 million of
availability under its Euro denominated line of credit, which only
provides an interim source of liquidity because it expires within a
year, though there is an annual renewal option. Moody's believes
these cash sources provide adequate coverage for the required term
loan amortization of approximately $6.7 million and operational
needs. There are no term loan financial maintenance covenants and
Moody's does not expect revolver availability to fall below the 10%
level that would trigger the minimum 1x fixed charge coverage
ratio. The maturity profile is good with the asset-based revolver
expiring in 2026 and the U.S. term loan maturing in 2028 and Euro
term loan maturing in 2027.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
The positive outlook reflects Moody's expectation that Journey will
be able to further improve its operating performance and improve
earnings through EBITDA growth that will lead to deleveraging to
about 9x debt-to-EBITDA on a Moody's adjusted basis over the next
12 months. The positive outlook also reflects Moody's expectation
that the company will maintain adequate liquidity.
The ratings could be downgraded if Journey is unable to restore
EBITDA growth over the next 12 months, if liquidity weakens for any
reason, or debt/EBITDA leverage remains elevated. The ratings could
also be downgraded if the company is unable to maintain market
share, experiences retail distribution losses, or pricing does not
keep pace with costs. Debt funded acquisitions or shareholder
distributions could also lead to a downgrade.
An upgrade would require that the company stabilize and improve
earnings including successfully implementing actions to mitigate
cost pressures. An upgrade would also require Journey to generate
consistent positive free cash flow and materially reduce leverage.
The principal methodology used in these ratings was Consumer
Packaged Goods published in June 2022.
Journey Personal Care Corp. (dba Attindas Hygiene Partners,
headquartered in Raleigh, North Carolina) designs, manufactures and
sells a range of branded and partner-branded adult incontinence
products including protective underwear, briefs, underpads, and
pads as well as diapers and training pants for babies throughout
North America and Europe. Journey generated approximately $970
million in annual revenue for the latest 12 months ending March 31,
2023 and was acquired by private equity firm American Industrial
Partners in a March 2021 leveraged buyout.
KARAFIN SCHOOL: Wins Cash Collateral Access Thru May 30
-------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of New York
authorized Karafin School, Inc. to use cash collateral on an
interim emergency basis in accordance with the budget and its
agreement with the Internal Revenue Service, through the date of
the final hearing set for May 30, 2023.
The Debtor requires the use of cash collateral to fund its business
operations, including payment of wages and rent.
The IRS Stipulation provides, inter alia, that:
(i) The Debtor has tax liabilities to the IRS in the amount of
$212,535, of which $198,004 is secured by the IRS Liens;
(ii) The IRS consents to the Debtor's use of cash collateral
without the requirement of a budget;
(iii) The Debtor will provide the IRS with adequate protection
for its interest in the cash collateral consisting of (a) monthly
payments in the amount of $4,155 commencing August 18, 2023 and
continuing for a total of 56 months and (b) a valid, enforceable,
fully-perfected, security interest, effective as of the Filing
Date, to the extent of, and as security for any decrease in the
value of the IRS' interest in the cash collateral since the Filing
Date, in, to and upon all existing and hereafter acquired property
of Debtor of any kind or nature, in the same validity, order and
priority as the prepetition IRS Liens, subordinate only to United
States Trustee fees, pursuant to 28 U.S.C. section 1930 and any
interest thereon, and will not extend to estate causes of action
and the proceeds of any recoveries of estate causes of action under
Chapter 5 of the Bankruptcy Code;
(iv) The IRS reserves its right to assert a superpriority claim
pursuant to 11 U.S.C. section 507(b), and the Debtor reserves its
defenses to such a claim;
(v) The Debtor will remain current with all post-Filing Date
tax liabilities, timely file all required post-Filing Date tax
returns, file all past due tax returns within 45 days of the entry
of the IRS Stipulation, and timely make all required tax deposits,
and serve notice of all tax deposits on the IRS;
(vi) A "Default" will occur if the Debtor fails to remain
current on its Post-Filing Date tax liabilities and if such Default
is not cured within five business days after written notice to the
Debtor, the Debtor's attorneys, the United States Trustee, and the
Subchapter V Trustee, and any official committee of unsecured
creditors, the Default will serve as an appropriate basis for the
case to be dismissed or converted to Chapter 7 on motion of the
IRS; and
(vii) The Debtor's right to use cash collateral under the IRS
Stipulation will terminate immediately upon the occurrence of any
of the following:
(1) entry of an order converting or dismissing the
Debtor's Chapter 11 case,
(2) entry of an order confirming a Chapter 11 plan in the
Debtor's case,
(3) a Default by the Debtor under the IRS Stipulation that
is not cured within five business days after written notice,
(4) amendment, supplementation, waiver or modification of
all or a part of the IRS Stipulation without the IRS having been
given at least 72 hours advance, written notice, of any hearing
with respect thereto, and
(5) the termination of all or substantially all of the
operations of the Debtor.
The Small Business Financial Solutions, LLC has a security interest
in the Debtor's cash collateral, subordinate to that of the IRS.
SBFS' claim is entirely undersecured, and SBFS is not entitled to
adequate protection for the use of Debtor's cash collateral.
The Debtor is permitted to use cash collateral for the payment of:
(i) prepetition wages and benefits for non-insider employees
for the pre-petition period from March 1 to April 18, 2023,
pursuant to a proposed pre-petition wage order submitted by Debtor,
in an amount not exceeding $ 69,318,
(ii) wages for employees for the post-Filing Date periods from
(x) April 18 to April 30, 2023, due May 15, 2023 in the approximate
amount of $40,550, (y) May 1 to May 15, due May 31, 2023 in the
approximate amount of $56,600, and (z) May 16 to May 31, due June
15 in the approximate amount of $58,150,
(iii) post-petition rent for the Debtor's business Premises, for
the month of May 2023 in a negotiated reduced amount of
approximately $26,0000 per month, pursuant to an agreement to be
finalized between the Debtor and the Debtor's landlord, which will
be submitted to the Court for approval when finalized,
(iv) health insurance premiums for employees for May 2023 in
the amount of $11,438, and
(v) other necessary business expenses in an amount not to
exceed $10,000 per week.
A copy of the motion is available at https://bit.ly/3Oh1ANS from
PacerMonitor.com.
About The Karafin School, Inc.
The Karafin School, Inc. is a special education school in Mount
Kisco, New York. The Debtor sought protection under Chapter 11 of
the U.S. Bankruptcy Code (Bankr. S.D.N.Y. Case No. 23-22281) on
April 18, 2023. In the petition signed by Renee Donow, president,
the Debtor disclosed $90,000 in total assets and $2,595,369 in
total liabilities.
Judge Sean H. Lane oversees the case.
A. Scott Mandelup, Esq., at Pryor and Mandelup, LLP, represents the
Debtor as legal counsel.
KINGSTONE INSURANCE: AM Best Cuts Fin. Strength Rating to B-(Fair)
------------------------------------------------------------------
AM Best has downgraded the Financial Strength Rating to B- (Fair)
from B (Fair) and the Long-Term Issuer Credit Rating (Long-Term
ICR) to "bb-" (Fair) from "bb" (Fair) of Kingstone Insurance
Company (KICO) (Kingston, NY). The outlook of these Credit Ratings
(ratings) is negative.
The ratings of KICO reflect its balance sheet strength, which AM
Best assesses as adequate, as well as its marginal operating
performance, limited business profile and marginal enterprise risk
management (ERM).
The rating downgrades are driven by consistent deterioration in
underwriting results, driving considerable pre-tax operating losses
over the last several years. The results were impacted primarily by
a series of weather-related losses, as well as adverse development
driven mostly by commercial liability claims. (This line of
business subsequently has been placed into run-off.) Overall, the
company's operating metrics in terms of returns on equity and
revenue and combined ratios are in line with the marginal
assessment. To address operating performance, management has
instituted a series of initiatives to return to profitability.
Among them are implementing rate increases across all product
lines, reducing commissions, closely monitoring catastrophe
exposures and modernizing product, technology and processes with a
goal of improving profitability in the future.
KICO's balance sheet strength assessment is adequate based on its
adequate risk-adjusted capitalization, as measured by Best's
Capital Adequacy Ratio (BCAR). Significant deterioration in
risk-adjusted capitalization has occurred across all return periods
in recent years due to a sizeable increase in the net probable
maximum loss as result of changes to the company's reinsurance
program structure, adverse reserve development mainly related to
commercial liability claims, declines in surplus from
weather-related losses and above-average reinsurance dependence as
measured by ceded reinsurance leverage as of year-end 2022. While
the company has implemented a number of strategic initiatives to
lower its overall level of catastrophe exposure and corresponding
reinsurance requirements, the negative outlooks reflect the
potential for additional negative rating action based on volatility
associated with various capital adequacy metrics.
KICO's limited business profile assessment reflects its product and
geographic concentration as it predominately writes personal lines
business on Long Island in New York. In 2019, the company decided
to no longer underwrite commercial liability risks, which drove
much of the underwriting loss and adverse loss development in 2019.
Furthermore, the company is aggressively reducing non-New York
businesses to improve operating performance metrics and stabilize
capital.
KICO's marginal enterprise risk management assessment reflects the
elevated net probable maximum loss for a 100-year return period,
which accounted for sizable percentage of the company's year-end
2022 surplus. There is significant tail risk as reflected at the
99.8% value-at-risk level, which has trended upward in recent years
due to considerable change in the amount of catastrophe reinsurance
protection. Therefore, the company's risk appetite is considered
above average when considering the risk profile.
KLX ENERGY: Posts $9.4 Million Net Income in First Quarter
----------------------------------------------------------
KLX Energy Services Holdings, Inc. has filed with the Securities
and Exchange Commission its Quarterly Report on Form 10-Q
disclosing net income of $9.4 million on $239.6 million of revenues
for the three months ended March 31, 2023, compared to a net loss
of $19.9 million on $152.3 million of revenues for the three months
ended march 31, 2022.
As of March 31, 2023, the Company had $515.9 million in total
assets, $160.7 million in total current liabilities, $283.6 million
in long-term debt, $20.1 million in long-term operating lease
obligations, $23.3 million in long-term finance lease
obligations,$0.7 million in other non-current liabilities, and
$27.5 million in total stockholders' equity.
Chris Baker, KLX president and chief executive officer, stated, "We
overcame seasonal pressures in the first quarter, including
weather, elevated personnel costs from the January reset of
unemployment taxes and two additional payrolls in the first
quarter, along with the well-discussed commodity price volatility,
to report record first quarter results that exceeded our
expectations and guidance across all metrics. The first quarter of
2023 marked the twelfth consecutive quarter of sequential revenue
improvement for KLX and furthermore we exited the first quarter
generating record monthly levels of revenue and Adjusted EBITDA.
"We executed on our highly accretive acquisition of Greene's on
March 8th. The operational fit and integration have been
exceptional and cement KLX as a diverse, scaled and technologically
differentiated market leader in the pressure control space. We
believe this transaction is a blueprint by which KLX can pursue
additional tuck-in consolidation.
"Despite recent volatility in commodity prices and rig count
declines driving short-term dislocation, the market backdrop
remains constructive and the supply and demand fundamentals
continue to favor the services sector. As we enter the second
quarter, we have seen some softening across a few of our product
lines driven by a reduction in Haynesville Shale activity in our
Northeast/Mid-Con Region and an associated impact on adjacent
basins, but the overall market remains tight for many of our
service lines. We believe KLX is well positioned to manage these
disruptions given our competitive positioning and ability to take a
portfolio allocation approach to mobilizing our assets across a
diverse product line and geographic footprint. Looking forward to
the second quarter, we expect continued strong utilization and
margin, plus a full quarter's impact from Greene's, to drive
sequential expansion of quarterly revenue and Adjusted EBITDA. As
we look out to full year 2023, we will continue to proactively
deploy our portfolio of assets to maximize our results in the face
of market volatility and basin rotation with a focus on generating
meaningful free cash flow," concluded Baker.
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1738827/000173882723000032/klxe-20230331.htm
About KLX Energy
KLX Energy Services Holdings, Inc. -- www.klxenergy.com -- is a
provider of diversified oilfield services to leading onshore oil
and natural gas exploration and production companies operating in
both conventional and unconventional plays in all of the active
major basins throughout the United States. The Company delivers
mission critical oilfield services focused on drilling, completion,
production, and intervention activities for technically demanding
wells from over 60 service and support facilities located
throughout the United States. KLX's complementary suite of
proprietary products and specialized services is supported by
technically skilled personnel and a broad portfolio of innovative
in-house manufacturing, repair and maintenance capabilities.
KLX Energy reported a net loss of $3.1 million for the year ended
Dec. 31, 2022, a net loss of $332.2 million for the year ended Jan.
31, 2021, and a net loss of $96.4 million for the year ended Jan.
31, 2020.
* * *
As reported by the TCR on March 30, 2023, S&P Global Ratings
revised its outlook to positive from stable and affirmed its 'CCC+'
issuer credit rating on KLX Energy Services Holdings LLC. The
positive outlook reflects S&P's view that KLXE's credit measures
will continue to improve over the next 12 months, based on higher
demand and improved pricing for its products and services.
KRONOS WORLDWIDE: Fitch Affirms 'B+' LongTerm IDR, Outlook Stable
-----------------------------------------------------------------
Fitch Ratings has affirmed the Long-Term Issuer Default Ratings of
Kronos Worldwide, Inc. (Kronos) and its wholly-owned subsidiary,
Kronos International, Inc. at 'B+'. Fitch has also affirmed the
issue ratings of Kronos International Inc.'s senior secured notes
at 'BB'/'RR2' and of the $225 million senior secured asset-backed
lending (ABL) facility at 'BB+'/'RR1'. The Rating Outlook remains
Stable.
Kronos' ratings reflect its strong liquidity position, conservative
financial policy and low capex requirements. The company's exposure
to the cyclical titanium dioxide (TiO2) industry introduces cash
flow variability. While Fitch expects weaker TiO2 volumes and
pricing and impacts from elevated ore and energy costs to lead to
slightly negative FCF over the medium-term, Kronos benefits from
considerable financial flexibility exhibited by a modest debt load,
strong coverage metrics, and comfortable liquidity.
The Stable Outlook reflects Fitch's expectations for EBITDA
Leverage to trend around 3.0x over the forecast horizon, as
weakening EBITDA generation should only moderately impact the
company's modest capital structure. Although Kronos' financial
profile is generally consistent with 'BB' category rating
tolerances, a positive rating action is unlikely without material
increases in size, scale, diversification or structural
improvements in the TiO2 industry outlook.
KEY RATING DRIVERS
Declining Volumes, Resilient Pricing: Fitch forecasts Kronos'
revenues and EBITDA to decline by around 9% and 30%, yoy
respectively in 2023, driven by persistent weakness in end market
demand impacting sales volumes for the issuer's TiO2 products,
coupled with modest declines in pricing. Kronos and other major
TiO2 producers realized steep declines in sales volumes in 2H22
amid a prolonged period of customer destocking, as various
manufacturers aimed to liquidate higher cost finished goods and
reduce inventory balances in anticipation of a weak near-term macro
environment. This deterioration in demand was largely driven by
weakness in the cyclical paints & coatings and plastics end
markets, which Fitch estimates to account for around 60% and 20% of
global TiO2 consumption, respectively.
Though sales volumes are expected to remain soft through 2023,
market pricing levels have only slightly declined, supported by
prudent actions taken by producers to reduce utilization rates,
increasing usage of value stabilization contracts in the industry,
and elevated feedstocks. Fitch currently anticipates TiO2 market
conditions to recover in 2024, resulting in gradually improving
earnings generation for Kronos through the forecast horizon.
Elevated Energy, Feedstock Costs: Kronos' EBITDA margin is
projected to decline to around 8% in 2023 due to higher ore and
energy costs and weaker fixed cost absorption resulting from lower
asset utilization. The company's gross profit margin has
deteriorated to an average of 12% from 3Q22 through 1Q23 compared
to an average of 22% in 2019-2021. With around 80% of total
identifiable assets located in Europe, the issuer is materially
exposed to the region's evolving energy supply landscape. Fitch
expects Kronos' margins to start improving towards historical
levels in 2024, assuming a normalization in feedstock cost
inflation and that asset utilization returns to normal levels.
Kronos purchases its chloride-grade feedstock on the open market
but is able to offset some of its third-party exposure through its
ilmenite mines in Norway, which supply nearly all of its European
sulfate needs. Fitch estimates Kronos is exposed to third-party
feedstock suppliers for at least 75% of its feedstock
requirements.
Modest Debt Load: Fitch views Kronos' current debt load as modest
when compared with Fitch's view of a normalized EBITDA for the
company. Leverage is forecast to trend around 3.0x, or 1.0x on a
net debt basis, through the forecast period, as the forecasted
weakness in EBITDA generation only moderately impacts Kronos' light
capital structure. The company benefits from no upcoming maturity
payments until the senior secured Euro notes are due in 2025. Fitch
expects Kronos to successfully refinance its senior secured Euro
notes prior to maturity.
Kronos has minimal exposure to the perceived elevated interest rate
environment over the medium-term, given that total debt outstanding
as of 1Q23 only comprised of the fixed rate senior secured Euro
notes maturing in 2025.
Limited Diversification: Kronos is a pure-play pigment producer
that has no other business segments to act as a buffer in periods
of volatility in the TiO2 industry. Fitch believes this exposure
adds cash flow risk to the company's credit profile, as its
financial results are highly dependent on the health of the pigment
market.
This concern is partially offset by Fitch's expectation that Kronos
maintains robust liquidity throughout the forecast. Kronos believes
it has leading market positions in both Europe and North America
but Fitch views the company as having limited ability to affect
global market dynamics. Fitch estimates the company's EBITDA
generation at its European plants was severely limited during the
2015-2016 downturn in TiO2 prices, despite management's indication
it is the largest TiO2 producer in Europe.
DERIVATION SUMMARY
Kronos' ratings reflect its relatively small size and limited
diversification compared with peers in the TiO2 segment, while
acknowledging its healthy projected 2.5x-3.0x leverage and
generally neutral-to-positive cash flow profile. Compared with
industry leaders The Chemours Co. and Tronox Ltd., Kronos has
limited ability to influence TiO2 supply dynamics and, as a
pure-play pigment producer, has no other business segments to act
as a buffer if periods of significant volatility in the TiO2
industry reappear.
However, Kronos' debt load is manageable, and Fitch calculated
gross leverage metrics are generally consistent with 'BB' category
or better rating tolerances, which helped offset its lack of
diversification during periods of cyclicality. Fitch believes the
company will maintain robust liquidity throughout the forecast and
that leverage will trend around 2.5x-3.0x over the medium-term.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within Its Rating Case for the Issuer:
- Revenues decline by about 9% in 2023 due to soft volumes and
declining TiO2 pricing, followed by a gradual recovery thereafter
assuming rebounds in macroeconomic activity;
- EBITDA margins fall to around 8% in 2023 on weaker fixed cost
absorption resulting from lower projected asset utilization and
elevated ore and energy costs, before trending back above 9%
thereafter due to increasing volumes coupled with a normalization
in energy and ore costs;
- Capex of around $45 million in 2023 per company guidance,
followed by around $60 million annually thereafter as operating
conditions normalize;
- 2025 Euro notes are refinanced in a leverage-neutral transaction
prior to maturity with similar terms and an assumed coupon of
around 8%;
- Dividends of around $88 million annually.
Key Recovery Rating Assumptions:
The recovery analysis assumes Kronos would be reorganized as a
going-concern in bankruptcy rather than liquidated. Fitch has
assumed a 10% administrative claim.
Fitch used a going-concern EBITDA of $132 million to reflect what
Fitch would views as a mid-cycle amount in a post-bankruptcy
scenario, which would likely be around 2014/2016 levels. The 5.0x
multiple acknowledges the commoditized nature of Kronos' TiO2
products and its lack of diversification.
Fitch expects Kronos draws approximately $190 million under its
ABL, representing about 85% of the full $225 million amount. This
is due to the likelihood the ABL borrowing base will be lessened in
a distressed scenario as the TiO2 pricing environment declines over
time, which would gradually reduce the borrowing base compared with
a lower-rated issuer that would more likely draw on its ABL
sooner.
Under this scenario, Kronos' $225 million ABL and €400 million
secured note recoveries correspond to an 'RR1' and 'RR2',
respectively. Fitch used $450 million as the converted U.S. dollar
amount of Kronos' EUR notes for these calculations. Fitch believes
this amount generally represents the average amount outstanding
when converted to U.S. dollars.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
A positive rating action is unlikely without material increases in
size, scale, diversification or structural improvements in the TiO2
industry outlook.
- Increases in size, scale, or diversification leading to improved
mid-cycle EBITDA size or cost position;
- Maintenance of current financial policies, leading to EBITDA
Leverage sustained below 3.0x and continued robust financial
flexibility;
- A structurally improved sector outlook that results in EBITDA
margin resiliency and reduced FCF variability.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Structural deterioration in the TiO2 market leading to
expectations of negative FCF generation, weakened EBITDA margins
and reduced financial flexibility;
- EBITDA Interest Coverage sustained below 3.5x;
- EBITDA Leverage sustained above 4.0x;
- Material debt-funded dividend payments or acquisition activity.
LIQUIDITY AND DEBT STRUCTURE
Comfortable Liquidity: Kronos had $178 million of cash and cash
equivalents on its balance sheet, and full availability under its
$225 million global ABL revolver as of March 31, 2023. In an
extended period of stress, the company has the ability to cut its
dividend payment, and paired with modest capex requirements and a
light maturity schedule, Fitch believes the company will maintain
strong liquidity throughout the forecast period.
Fitch's forecast assumes Kronos successfully refinances its Euro
notes in 2024 with similar terms but at a higher coupon of around
8% given current option-adjusted spreads for similar-rated
issuers.
ISSUER PROFILE
Kronos Worldwide, Inc. is a pure-play TiO2 producer that Fitch
estimates to be the fifth largest producer of TiO2 in the world.
TiO2 is a pigment that imparts whiteness, brightness and opacity,
and is primarily used in the production of paints and coatings.
Historically, prices have tended to be volatile owing to TiO2's
commoditized characteristics, and the industry is extremely
sensitive to supply and demand imbalances.
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
----------- ------ -------- -----
Kronos
International
Inc. (Valhi,
Inc.Unit) LT IDR B+ Affirmed B+
senior secured LT BB Affirmed RR2 BB
Kronos Worldwide,
Inc. LT IDR B+ Affirmed B+
senior secured LT BB+ Affirmed RR1 BB+
LEGACY AT WILLOW BEND: Fitch Affirms 'BB' IDR, Outlook Neg.
-----------------------------------------------------------
Fitch Ratings has affirmed Legacy at Willow Bend's (LWB) Issuer
Default Rating (IDR) at 'BB'. Fitch has also affirmed approximately
$46 million of series 2016 fixed rate revenue bonds issued by the
New Hope Cultural Education Facilities Finance corporation on
behalf of LWB.
The Rating Outlook remains Negative.
Entity/Debt Rating Prior
----------- ------ -----
Legacy Willow
Bend (The) (TX) LT IDR BB Affirmed BB
Legacy Willow
Bend (The)
(TX) /General
Revenues/1 LT LT BB Affirmed BB
SECURITY
The bonds are secured by a gross revenue pledge, mortgage pledge,
and debt service reserve fund.
ANALYTICAL CONCLUSION
The rating reflects management's limited ability to increase
revenues and contain costs, leaving LWB vulnerable to external
operating pressures with its minimal balance sheet cushion. The
Negative Outlook reflects potential rating pressure should LWB fail
to stabilize and improve operating margins and also considers the
possibility that LWB will increase its long-term debt to fund an
independent living unit (ILU) expansion.
LWB's unit mix includes more healthcare capacity than the community
has needed over the past few years. Management is considering an
ILU expansion in order to meet demand and adjust the unit mix.
While Fitch recognizes the potential benefit LWB may realize from
additional ILUs, LWB has no debt capacity at the current rating
level and the near-term risks associated with an expansion will
further pressure the rating.
In order to meet its 2023 debt service coverage ratio (DSCR)
covenant minimum of 1.2x, LWB's operations need to improve and net
entrance fees need to increase from the first quarter results for
FY 2023. While management projects to meet its covenant, continued
labor pressure could prevent this.
LWB's entrance fee refund policy (that the refund is triggered when
the resident leaves the community as opposed to when the resident
leaves the ILU) increases the potential for cash flow disruption
due to refund unpredictability. According to management, LWB
currently has $5 million in entrance fee refund liabilities
associated with residents in licensed care. These refund
liabilities contributed to LWB's DSCR covenant violation in 2021.
KEY RATING DRIVERS
Revenue Defensibility: 'bbb'
Good Service Area Supports Solid Demand
LWB's ILU occupancy has consistently remained in the mid to
high-90% range. At the end of December of 2022, ILU occupancy was
98%. Strong ILU occupancy indicates robust demand. Occupancy has
improved in the other areas of care as well, returning to levels
above 90% across the continuum, from lows near 80% in the assisted
living units (ALUs), 70% in the MCUs and 55% in skilled nursing
facility (SNF). Fitch expects LWB to maintain occupancy at the
improved levels.
LWB is uniquely positioned as the only Jewish-sponsored life plan
community (LPC) in its primary market area around Plano, TX.
Demographic indicators are sound, as the Dallas area enjoys
population growth above the national average and the housing market
remains robust. However, competition for senior living is strong in
the service area and expected to intensify when a new community
offering 180 ILUs and ALUs (but no SNF) opens three miles away in
2024. LWB has a solid track record of annual increases in both its
monthly service and entrance fees in recent years.
Operating Risk: 'bb'
Persistent Operating Pressures Weaken Cost Management
As a predominantly type A contract provider, LWB is limited in its
ability to manage healthcare costs.
LWB's profitability ratios have weakened since 2019 with operating
ratios exceeding 100% from 2020 through the first quarter of 2023,
compared with average ratios in the low 90% range from 2016 through
2019. Similarly, net operating margin (NOM) became negative in 2021
and 2022 compared with levels generally above 4% previously. Over
the Outlook period, Fitch expects operating ratios to continue to
exceed 100% but remain below 105% and the NOM to build back
incrementally to break even and eventually increase to the 4%
range.
NOM -- Adjusted (NOMA) fell from levels consistently above 20%
prior to 2020 to below 7% in 2021 and 2022. Given improved
occupancy in healthcare, Fitch expects profitability ratios to
improve compared with 2020 through 2022, but still remain
consistent with the weak assessment over the next several years.
Management is considering adding ILUs in order to meet demand and
improve the unit mix. Given the uncertainty around LWB's ability to
meet its 2023 DSCR covenant and subsequent ability to secure
funding for the expansion, the project has not been incorporated
into the 'BB' rating. The Negative Outlook reflects a likely
downgrade if LWB incurs any additional permanent long-term debt or
draws on liquidity.
Given LWB's strong waitlist and IL demand generally, Fitch expects
the project to fill. The additional ILUs would improve LWB's unit
mix and likely strengthen profitability ratios after the project
stabilizes.
Without an expansion project, management expects to keep capex
spending below 70% of depreciation over the next several years.
Average age of plant was 12 years at the end of 2022.
LWB's capital-related metrics have a historical average
revenue-only MADS coverage of approximately 0.4x over the past five
years. MADS represented a moderate 13.5% of 2022 revenues.
Revenue-only MADS coverage and debt-to-net available were
particularly weak in 2022 at negative 0.2x and 12.4x, respectively.
These ratios should improve over the next few years, but not to
historical levels.
Financial Profile: 'bb'
Thin Balance Sheet
LWB's financial profile is rated 'bb'. At FYE 22, LWB had
approximately $45 million of debt. Unrestricted cash and
investments measured approximately $15 million.
Fitch's forward-looking base case shows LWB maintaining operating
and financial metrics that are consistent with a 'BB' rating. Net
entrance fees are expected to remain stable and consistent with
historical results. Capex is expected to be approximately $1.5
million annually and does not include the potential ILU expansion.
In a stress case, LWB's cash-to-adjusted debt and MADS coverage
maintain levels consistent with the 'BB' rating, but with thinner
headroom.
Cash has been above 200 days cash on hand (DCOH) for the past
several years, and is not an asymmetric risk.
Asymmetric Additional Risk Considerations
No asymmetric risk considerations were relevant to the rating
determination.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Cash to debt that approaches 20% without the expectation of a
recovery;
- Sustained ILU occupancy below 88%;
- Failure to meet financial covenants;
- DSCR near or below 0.5x;
- Cash transfers outside the obligated group.
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Given the current operating weakness, an upgrade is unlikely over
the Outlook period;
- An Outlook revision to Stable is possible if LWB meets its DSCR
covenant, profitability improves with operating ratios near or
below 100%, and LWB does not plan to incur any additional permanent
long-term debt.
CREDIT PROFILE
LWB is a Type A LPC located in Plano, approximately 20 miles north
of Dallas. LWB opened in April 2008 and has 114 ILUs (102
apartments and 12 villas), 40 ALUs, 18 memory support suites, and
60 SNF beds. Lifecare residents are primarily on the 90% refundable
entrance fee plan. Management has set aside up to six ILUs to be
used as rentals for residents who do not have the financial
resources for the lifecare contract. LWB is subject to an annual
1.2x DSCR covenant minimum and a liquidity covenant minimum of 150
DCOH.
LWB's sole corporate parent is Legacy Senior Communities (LSC),
which manages LWB under a management agreement. Fitch's analysis is
based on LWB, which is the only obligated group member.
Sources of Information
In addition to the sources of information identified in Fitch's
applicable criteria specified below, this action was informed by
information from Lumesis.
ESG CONSIDERATIONS
Unless otherwise disclosed in this section, the highest level of
ESG credit relevance is a score of '3'. This means ESG issues are
credit-neutral or have only a minimal credit impact on the entity,
either due to their nature or the way in which they are being
managed by the entity.
LEGACY CARES: U.S. Trustee Appoints Creditors' Committee
--------------------------------------------------------
The U.S. Trustee for Region 14 appointed an official committee to
represent unsecured creditors in the Chapter 11 case of Legacy
Cares, Inc.
The committee members are:
1. FieldTurf USA, Inc.
Attention: Marie-France Nantel
3000 Aurora Rd.
Solon, OH 44139
Telephone: (440) 903-4633
Email: MFNantel@tarkett.com
2. Icing Investment Holdings, LLC
Attention:_Lee Plosjai
11201 N. Tatum Blvd., Suite 300
Phoenix, AZ 85028
Telephone: (602) 510-1116
Email: lee@icingholdings.com
3. OVG Facilities, LLC and
Spectra Food Services & Hospitality
Attention: Brian Rothenberg
150 Rouse Boulevard
Philadelphia, PA 19112
Telephone: (215) 264-2800
Email: Brian.Rothenberg@oakviewgroup.com
4. Hurricane Fence, Inc.
Attention: Kirby Reinhardt
3404 W. Lincoln
Phoenix, AZ 85009
Telephone: (602) 484-9005
Email: kirbyr@hurricanefenceco.com
5. Earthscapes, Inc.
Attention: Les Keebler
4640 E. Cotton Gin Loop
Phoenix, AZ 85040
Telephone: (602) 296-1496
Email: lkeeble@haydonbc.com
6. Icon Architectural Group, LLC
Attention: Cassie Scheving
4000 Garden View Drive, Suite 101
Grand Forks, ND 58201
Telephone: (701) 757-5087
Email: cassie.scheving@iconarchitects.com
7. Tri Phx LLC d/b/a Adventure Fitness
Attention: Kristen E. Stewart
1836 W. Straight Arrow Ln.
Phoenix, AZ 85085
Telephone: (203) 470-0602
Email: kristen@adv.fit
Official creditors' committees serve as fiduciaries to the general
population of creditors they represent. They may investigate the
debtor's business and financial affairs. Committees have the right
to employ legal counsel, accountants and financial advisors at a
debtor's expense.
About Legacy Cares
Legacy Cares, Inc. is a 501c3 non-profit organization dedicated to
providing athletes and non-athletes of all ages, economic
backgrounds and levels of athletic proficiency the opportunity to
participate in sports and e-sports while fostering the enjoyment
and camaraderie of teamwork and perseverance, key components in
athletic competition and lifetime success. The organization is
based in Mesa, Ariz.
Legacy Cares sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case No. 23-02832) on May 1, 2023,
with $242,329,104 in assets and $366,719,676 in liabilities.
Douglas Moss, president of Legacy Cares, signed the petition.
Judge Daniel P. Collins oversees the case.
The Debtor tapped Henk Taylor, Esq., at Warner Angle Hallam Jackson
Formanek, PLC as bankruptcy counsel; Papetti Samuels Weiss
McKirgan, LLP as special litigation counsel; and Miller Buckfire &
Co., LLC and its affiliate, Stifel, Nicolaus & Co., Inc., as
investment banker. Epiq Corporate Restructuring, LLC is the
noticing, claims and balloting agent.
MAGENTA BUYER: $750M Bank Debt Trades at 29% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Magenta Buyer LLC
is a borrower were trading in the secondary market around 71.2
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $750 million facility is a Term loan that is scheduled to
mature on July 27, 2029. The amount is fully drawn and
outstanding.
Magenta Buyer LLC is a provider of cybersecurity software that
derives revenue from the sale of security products, subscriptions,
SaaS, support and maintenance, and professional services.
MATRIX PARENT: $160M Bank Debt Trades at 47% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Matrix Parent Inc
is a borrower were trading in the secondary market around 53.2
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $160 million facility is a Term loan that is scheduled to
mature on March 1, 2030. The amount is fully drawn and
outstanding.
The Company's country of domicile is the United States.
MONEYGRAM INTERNATIONAL: S&P Rates New $400MM Secured Notes 'B'
---------------------------------------------------------------
S&P Global Ratings assigned its 'B' issue rating and '3' recovery
rating to MoneyGram International's (MGI) proposed $400 million
senior secured notes due 2030. The '3' recovery rating indicates
its expectation for meaningful (50%-70%; rounded estimate: 55%)
recovery in the event of a hypothetical default.
The company intends to use the net proceeds from this transaction
to partially finance Madison Dearborn Partners' (MDP) acquisition
of MGI. To complete the acquisition and refinance its existing
debt, MGI also intends to raise a $500 million term loan, $100
million holdco senior notes due 2028, $300 million holdco preferred
equity, and $740 million common equity. The proposed secured notes
will rank pari passu with the term loan and undrawn revolver in the
first-lien debt agreement. After closing, MGI's existing term loan
and senior secured notes, with $379 million and $415 million
outstanding balances as of March 31, 2023, respectively, will be
retired.
As of March 31, 2023, MGI's leverage, measured by adjusted debt to
EBITDA, declined slightly to 5.5x from 5.7x at year-end 2022. Pro
forma for the transaction, S&P expects the company to operate with
leverage of 8x-9x and cash interest coverage of 2x-3x.
S&P said, "In our leverage calculation, we include the new holdco
notes and new holdco preferred equity as part of MGI's total debt
since both Mobius Financing Intermediate Inc. and Mobius
Intermediate Holdco Inc. will rely on dividends from MGI for
servicing. We treat the new holdco preferred equity as debt, rather
than equity, because it is callable after two years. Excluding the
$300 million preferred equity from the leverage, we estimate pro
forma leverage of around 6x-7x.
"Our base-case forecast assumes the company's total revenue will
grow by mid-to-high single digits in 2023, driven by strong growth
in its digital channel and higher investment revenue. We also
expect its adjusted EBITDA margin to remain relatively stable
between 12%-14%.
"The stable outlook over the next 12 months indicates our
expectation for EBITDA cash interest coverage of 2.0x-3.0x, debt to
EBITDA above 5.0x, and no new compliance deficiencies. Our outlook
also considers MGI's existing market position in global money
transfer services, its financial sponsor ownership, adequate
liquidity, and sufficient covenant cushion."
Issue Ratings--Recovery Analysis
Key analytical factors
-- S&P's simulated default scenario contemplates a payment default
in 2026, significantly lower money transfer volume, and increased
competition.
-- S&P assumes a reorganization following the default, using an
emergence EBITDA multiple of 5.0x to value the company.
Simulated default assumptions
-- Simulated year of default: 2026
-- EBITDA at emergence: $128 million
-- EBITDA multiple: 5.0x
Simplified waterfall
-- Net enterprise value after 5% administrative expenses: $608
million
-- Collateral value available to debtholders: $608 million
-- Senior secured debt: $1,060 million
-- Recovery expectation: meaningful recovery 50% to 70% (rounded
up to 55%) ('3')
MONITRONICS INTERNATIONAL: Unsecureds Will Get 100% in Plan
-----------------------------------------------------------
Monitronics International, Inc. and its Debtor Affiliates filed
with the U.S. Bankruptcy Court for the Southern District of Texas a
Disclosure Statement for Joint Partial Prepackaged Plan of
Reorganization dated May 15, 2023.
The Debtors are one of the largest security alarm monitoring
companies in North America, with customers under contract in all 50
states, the District of Columbia, Puerto Rico and Canada. The
Debtors provide residential and commercial customers with monitored
home and business security systems.
The Debtors are commencing Solicitation after extensive discussions
over the past several months with certain of their key creditor and
shareholder constituencies.
As a result of these negotiations, the Debtors have entered into
the Restructuring Support Agreement, with (i) certain senior
secured term and revolving loan lenders (the "Consenting 2019 Exit
Facility Lenders") under that certain Senior Secured Credit
Agreement, dated as of August 30, 2019, by and among Monitronics,
as borrower.
Under the terms of the Restructuring Support Agreement, the
Restructuring Support Parties agreed to deleveraging transactions
(the "Restructuring") that would restructure the existing debt
obligations of the Debtors through the Plan. In order to effectuate
the Restructuring, the Debtors anticipate filing voluntary
petitions for relief under chapter 11 to initiate bankruptcy cases
on or about May 15, 2023.
The Restructuring Support Parties include a significant majority of
the Holders of the Debtors' funded debt (lenders holding in the
aggregate 100% of the 2019 Takeback Term Loan Facility and
approximately 71.9% of the 2019 Exit Credit Facilities as of May
15, 2023) as well as a significant majority of the Holders of
Monitronics Equity Interests (approximately 72.75% as of May 9,
2023). Such parties represent the requisite voting majorities under
the Bankruptcy Code for both Class 3 (2019 Takeback Term Loan
Claims) and Class 7 (Monitronics Equity Interests). All other
classes of Claims or Equity Interests in the Plan are Unimpaired.
The Restructuring proposed by the Debtors will provide substantial
benefits to the Debtors and all of their stakeholders. The
Restructuring will leave the Debtors' businesses intact and
substantially de-levered, providing for the reduction of
approximately $500 million of debt upon emergence. This
de-leveraging will enhance the Debtors' long-term growth prospects
and competitive position and allow the Debtors to emerge from the
Chapter 11 Cases as reorganized entities better positioned to
withstand the competitive security and alarm services industry.
Moreover, the Restructuring proposed under the Plan provides
recoveries to all of the Debtors' stakeholders. The Plan provides
for a recovery to each class of non-Affiliate Claims and Equity
Interests in the form of Cash, debt, or equity, rights to
participate in new money debt and equity investments, or a
combination thereof. Distributions of equity in Reorganized
Monitronics will allow certain creditors and equity holders (at
their election) to participate in potential future upside in
Reorganized Monitronics.
Class 4 consists of General Unsecured Claims. Except to the extent
that a Holder of an Allowed General Unsecured Claim and the Debtors
agree to less favorable treatment on account of such Claim, each
Holder of an Allowed General Unsecured Claim shall receive, in full
and final satisfaction, settlement, release and discharge of, and
in exchange for, such Allowed General Unsecured Claim, on or as
soon as practicable after the Effective Date or when such
obligation becomes due in the ordinary course of business in
accordance with applicable law or the terms of any agreement that
governs such Allowed General Unsecured Claim, whichever is later,
either, in the discretion of the Debtors, (i) payment in full in
Cash, or (ii) such other treatment as to render such Holder
Unimpaired. This Class will receive a distribution of 100% of their
allowed claims. This Class is unimpaired under the Plan.
Class 7 consists of Monitronics Equity Interests. On the Effective
Date, all Monitronics Equity Interests shall be cancelled and
extinguished and shall be of no further force and effect, whether
surrendered for cancellation or otherwise, and each Holder of a
Monitronics Equity Interest, in full and final satisfaction,
settlement, release and discharge of, and in exchange for, such
Monitronics Equity Interest, shall receive either: (i) such
Holder's Pro Rata share of the Class 7 Cash Pool, or (ii) solely to
the extent that such Holder timely and validly makes the Class 7
Equity Election on the Class 7 Equity Election Form, such Holder's
Pro Rata share of the Class 7 Equity Pool.
All consideration necessary for the Debtors and/or Reorganized
Debtors, as applicable, to make payments or distributions pursuant
to the Plan shall be obtained from Cash from the Debtors and/or
Reorganized Debtors, as applicable, including Cash from business
operations and the proceeds of the New Exit Facility, the Equity
Rights Offering, the Debt Rights Offering, and/or the Backstop
Commitments, as applicable.
Further, the Debtors and the Reorganized Debtors will be entitled
to transfer funds between and among themselves as they determine to
be necessary or appropriate to enable the Reorganized Debtors to
satisfy their obligations under the Plan. Except as set forth in
the Plan, any changes in intercompany account balances resulting
from such transfers will be accounted for and settled in accordance
with the Debtors' historical intercompany account settlement
practices and will not violate the terms of the Plan.
Debtors' Counsel: Timothy A. ("Tad") Davidson II, Esq.
Ashley L. Harper, Esq.
Brandon Bell, Esq.
HUNTON ANDREWS KURTH LLP
600 Travis Street, Suite 4200
Houston, TX 77002
Tel: 713-220-4200
Email: TadDavidson@HuntonAK.com
AshleyHarper@HuntonAK.com
BBell@HuntonAK.com
- and -
David A. Hammerman, Esq.
Annemarie V. Reilly, Esq.
Christopher Beaucage, Esq.
LATHAM & WATKINS LLP
1271 Avenue of the Americas
New York, New York 10020
Tel: 212-906-1200
Email: david.hammerman@lw.com
annemarie.reilly@lw.com
chris.beaucage@lw.com
-and-
Helena Tseregounis, Esq.
Deniz A. Irgi, Esq.
LATHAM & WATKINS LLP
355 South Grand Avenue, Suite 100
Los Angeles, CA 90071-1560
Tel: 213-485-1234
Email: helena.tseregounis@lw.com
deniz.irgi@lw.com
About Monitronics International
The Debtors are primarily engaged in the business of providing
residential and commercial customers with monitored home and
business security systems, as well as interactive and home
automation services. The Debtor filed Chapter 11 Petition (Bankr.
S.D. Tex. Lead Case No. 23-90332) on May 15, 2023.
Hon. Christopher M. Lopez oversees the case. In the petitions
signed by William E. Niles, chief executive officer, the Debtor
disclosed $1 billion to $10 billion in assets and liabilities.
MORGUARD CORPORATION: DBRS Confirms BB(high) Issuer Rating
----------------------------------------------------------
DBRS Limited confirmed the Issuer Rating and Senior Unsecured
Debentures rating of Morguard Corporation at BB (high) with Stable
trends. The recovery rating of the Senior Unsecured Debentures is
RR4.
The rating confirmations reflect the modest improvement in
Morguard's key financial metrics and its business risk profile,
which the Company has maintained at levels commensurate with the
current rating category. The improvement, most notable in leverage
measured by total debt-to-EBITDA of 10.9 times (x) for the last 12
months ended December 31, 2022, was largely driven by a strong
operating performance particularly within the Company's multifamily
and hotel segments, which strongly rebounded in 2022 as easing of
Coronavirus Disease (COVID-19) pandemic restrictions positively
affected by rental growth and occupancy combined driving higher
same property net operating income (NOI) growth. However, DBRS
Morningstar anticipates that leverage will remain in the high 10x
range in the near to medium term as a result of a lack of a visible
path toward reduction in leverage. DBRS Morningstar's assessment of
Morguard's asset quality remains unchanged as challenges facing the
suburban office assets are partially offset by the high grading of
its hotel portfolio following the sale of 19 noncore,
underperforming hotel properties since 2021. DBRS Morningstar also
lowered its assessment of Morguard's lease maturity profile and
tenant quality as a result of a slight decline in its portfolio's
weighted-average lease term to maturity as compared with its
peers.
The Stable trends reflect the expectation that Morguard will
continue to generate stable cash flow from operations amid a
challenging macroeconomic environment. DBRS Morningstar anticipates
Morguard will continue high grading its portfolio through capital
recycling initiatives and use proceeds to repay debt and fund
development expenditures by the Company's cash on hand, free cash
flow, and manageable amounts of debt.
The ratings continue to be supported by (1) Morguard's average
quality real estate portfolio; (2) the Company's strong asset type
diversification with a broadly diversified portfolio across real
estate subsectors; and (3) Morguard Corporation benefitting from
the strong market position of the Morguard group of companies. The
ratings continue to be constrained by (1) the Company's elevated
leverage; (2) the portfolio's relatively short lease maturity
profile and average tenant quality; (3) the high proportion of
secured debt; (4) the relatively small portfolio; and (5)
Morguard's large exposure to office properties in
secondary/tertiary markets.
DBRS Morningstar continues to attribute rating benefit to
Morguard's holdings in Morguard Real Estate Investment Trust (MRT)
and Morguard North American Residential REIT (MRG; together with
MRT, the REITs), notwithstanding reduced distributions received
from MRT. DBRS Morningstar continues to believe that ownership in
the REITs, forming core long-term investment holdings of Morguard,
provides the Company with reliable quarterly cash distributions
that it can use for debt service. This enhances diversification and
stability of Morguard's cash flows and is a positive consideration
in Morguard's credit risk profile, thus warranting a modest, albeit
reduced, rating uplift.
DBRS Morningstar would consider taking negative rating action if
Morguard's total debt-to-EBITDA were to deteriorate above 11.0x and
EBITDA interest coverage deteriorated below 2.0x on a sustained
basis, all else equal, or if DBRS Morningstar were to reassess the
rating uplift provided by distributions received from the REITs.
DBRS Morningstar would consider a positive rating action if
Morguard's total debt-to-EBITDA were to improve below 10.0x and
EBITDA-interest coverage improved above 2.3x on a sustained basis,
all else equal.
Notes: All figures are in Canadian dollars unless otherwise noted.
MOUNTAIN EXPRESS: Committee Taps McDermott Will & Emery as Counsel
------------------------------------------------------------------
The official committee of unsecured creditors of Mountain Express
Oil Company and affiliates seeks approval from the U.S. Bankruptcy
Court for the Southern District of Texas to hire McDermott Will &
Emery LLP as its counsel.
The firm will render these services:
(a) advise the committee with respect to its rights, powers,
and duties in these Chapter 11 cases;
(b) participate in in-person and telephonic meetings of the
committee and subcommittees formed thereby, if any;
(c) assist and advise the committee in its meetings and
negotiations with the Debtors and other parties in interest
regarding the Chapter 11 cases;
(d) assist the committee in analyzing claims asserted against,
and interests in, the Debtors, and in negotiating with the holders
of such claims and interests and bringing, or participating in,
objections or estimation proceedings with respect to such claims
and interests;
(e) assist the committee in analyzing the Debtors' assets and
liabilities;
(f) assist the committee in its investigation of the acts,
conduct, assets, liabilities, management and financial condition of
the Debtors, the Debtors' historic and ongoing operations of their
businesses, and the desirability of the continuation of any portion
of those operations, and any other matters relevant to the Chapter
11 cases or to the formation of a plan;
(g) assist the committee in its analysis of, and negotiations
with the Debtors or any third party related to, financing, asset
disposition transactions, and compromises of controversies, review
and determine the Debtors' rights and obligations under leases and
executory contracts, and assist, advise, and represent the
committee in any manner relevant to the assumption and rejection of
executory contracts and unexpired leases;
(h) assist the committee in its analysis of, and negotiations
with, the Debtors or any third party related to, the formulation,
confirmation, and implementation of a Chapter 11 plan(s) and all
documentation related thereto (including the disclosure
statement);
(i) assist, advise, and represent the committee in
understanding its powers and its duties under the Bankruptcy Code
and the Bankruptcy Rules and in performing other services;
(j) assist and advise the committee with respect to
communications with the general creditor body regarding significant
matters in the Chapter 11 cases;
(k) respond to inquiries from individual creditors as to the
status of, and developments in, the Chapter 11 cases;
(l) represent the committee at hearings and other proceedings
before the court and other courts or tribunals, as appropriate;
(m) review and analyze complaints, motions, applications,
orders, and other pleadings filed with the court, and advise the
committee with respect to formulating positions with respect, and
filing responses, thereto;
(n) assist the committee in its review and analysis of, and
negotiations with the Debtors and their non-Debtor affiliates
related to, intercompany claims and transactions;
(o) review and analyze third party analyses and reports
prepared in connection with the Debtors' potential claims and
causes of action, advise the committee with respect to formulating
positions thereon, and perform such other diligence and independent
analysis as may be requested by the committee;
(p) advise the committee with respect to applicable federal
and state regulatory issues, as such issues may arise in the
Chapter 11 cases;
(q) assist the committee in preparing pleadings and
applications, and pursuing or participating in adversary
proceedings, contested matters, and administrative proceedings as
may be necessary or appropriate in furtherance of the committee's
duties;
(r) take all necessary or appropriate actions as may be
required in connection with the administration of the Debtors'
estates; and
(s) perform such other legal services as may be necessary or
as may be requested by the committee in accordance with the
committee's powers and duties as set forth in the Bankruptcy Code.
The hourly rates of the firm's counsel and staff are as follows:
Partners and Senior Counsel $1,300 - $2,590
Associates $725 - $1,250
Paraprofessionals $150 - $1,415
In addition, the firm will seek reimbursement for expenses
incurred.
The firm also provided the following in response to the request for
additional information set forth in D.1 of the Appendix B
Guidelines:
Question: Did you agree to any variations from, or alternatives
to, your standard or customary billing arrangements for this
engagement?
Answer: Yes, all billing rates are being discounted by 15
percent.
Question: Do any of the professionals included in this engagement
vary their rate based on the geographic location of the bankruptcy
case?
Answer: No.
Question: If you represented the client in the 12 months
prepetition, disclose your billing rates and material financial
terms for the prepetition engagement, including any adjustments for
the 12 months prepetition. If your billing rates and material
financial terms have changed post-petition, explain the difference
and the reasons for the difference.
Answer: McDermott did not represent the committee in the 12
months prepetition. McDermott has represented official committees
of unsecured creditors in other bankruptcy cases during the 12
months preceding the petition date.
Question: Has your client approved your prospective budget and
staffing plan and, if so, for what budget period?
Answer: The committee and McDermott expect to develop a
prospective budget and staffing plan, recognizing that in the
course of large chapter 11 cases, complex and unexpected issues may
arise that may in turn result in unforeseeable fees and expenses.
Charles Gibbs, Esq., a partner at McDermott Will & Emery, disclosed
in a court filing that the firm is a "disinterested person" as that
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Charles R. Gibbs, Esq.
McDermott Will & Emery LLP
2501 North Harwood Street, Suite 1900
Dallas, TX 75201
Telephone: (214) 295-8063
About Mountain Express Oil Company
Mountain Express Oil Company operates in the fuel distribution and
retail convenience industry. As one of the largest fuel
distributors in the American South, the company and its affiliates
serve 828 fueling centers and 27 travel centers across 27 states.
Mountain Express Oil Company and its affiliates sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas
Lead Case No. 23-90147) on March 18, 2023. In the petition signed
by its chief restructuring officer, Michael Healy, Mountain Express
Oil Company disclosed $100 million to $500 million in both assets
and liabilities.
Judge David R. Jones oversees the cases.
Pachulski Stang Ziehl & Jones, LLP represents the Debtors as
bankruptcy counsel. The Debtors also tapped Raymond James
Financial, Inc. as investment banker and FTI Consulting, Inc. as
financial advisor. Michael Healy, senior managing director at FTI,
serves as the Debtors' chief restructuring officer. Kurtzman Carson
Consultants, LLC is the claims, noticing and solicitation agent and
administrative advisor.
The U.S. Trustee for Region 7 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases. The
committee is represented by Marcus Helt, Esq.
MOUNTAIN EXPRESS: Committee Taps Province LLC as Financial Advisor
------------------------------------------------------------------
The official committee of unsecured creditors of Mountain Express
Oil Company and affiliates seeks approval from the U.S. Bankruptcy
Court for the Southern District of Texas to hire Province, LLC as
its financial advisor.
The firm's services include:
(a) becoming familiar with and analyzing the Debtors' budget,
assets and liabilities, and overall financial condition;
(b) reviewing financial and operational information furnished
by the Debtors;
(c) monitoring the sale process, reviewing bidding procedures,
bids submitted, asset purchase agreements, interfacing with the
Debtors' professionals, and advising the Committee regarding the
sale process;
(d) analyzing the economic terms of various agreements,
including, but not limited to, the Debtors' KEIP and KERP and
various professional retention;
(e) reviewing and analyzing the Debtors' proposed business
plans and developing alternative scenarios, if necessary;
(f) assessing the Debtors' various pleadings and proposed
treatment of unsecured creditor claims therefrom including but not
limited to, any proposed Plan of Reorganization and Disclosure
Statement;
(g) preparing, or reviewing as applicable, avoidance action
and claim analyses;
(h) assisting the Committee in reviewing the Debtors'
financial reports, including, but not limited to, statements of
financial affairs, schedules of assets and liabilities, and monthly
operating reports;
(i) advising the Committee on the current state of and key
issues arising during these Chapter 11 Cases;
(j) advising the Committee in negotiations with the Debtors
and third parties as
necessary;
(k) if necessary, participating as a witness in hearings
before the Court with respect to matters upon which Province has
provided advice;
(l) other activities as are approved by the Committee, the
Committee's counsel, and as agreed to by Province; and
(m) perform such other services as may be required or are
otherwise deemed to be in the interests of the Committee in
accordance with the Committee's powers and duties as set forth in
the Bankruptcy Code, Bankruptcy Rules or other applicable law.
The firm will be paid at these rates:
Managing Directors/Principals $860 to $1,350 per hour
Vice Presidents/Directors/
Senior Directors $580 to $950 per hour
Analysts/Associates/
Senior Associates $300 to $650 per hour
Paraprofessionals $220 to $300 per hour
Adam Rosen , a partner at Province, disclosed in court filings that
his firm is a "disinterested person" as that term is defined in
Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Adam Rosen
Province Inc.
700 Canal Street, STE 12E
Stamford, CT 06902
Tel: (702) 685-5555
Email: Arosen@provincefirm.com
About Mountain Express Oil Company
Mountain Express Oil Company operates in the fuel distribution and
retail convenience industry. As one of the largest fuel
distributors in the American South, the company and its affiliates
serve 828 fueling centers and 27 travel centers across 27 states.
Mountain Express Oil Company and its affiliates sought protection
under Chapter 11 of the U.S. Bankruptcy Code (Bankr. S.D. Texas
Lead Case No. 23-90147) on March 18, 2023. In the petition signed
by its chief restructuring officer, Michael Healy, Mountain Express
Oil Company disclosed $100 million to $500 million in both assets
and liabilities.
Judge David R. Jones oversees the cases.
Pachulski Stang Ziehl & Jones, LLP represents the Debtors as
bankruptcy counsel. The Debtors also tapped Raymond James
Financial, Inc. as investment banker and FTI Consulting, Inc. as
financial advisor. Michael Healy, senior managing director at FTI,
serves as the Debtors' chief restructuring officer. Kurtzman Carson
Consultants, LLC is the claims, noticing and solicitation agent and
administrative advisor.
The U.S. Trustee for Region 7 appointed an official committee to
represent unsecured creditors in the Debtors' Chapter 11 cases. The
committee is represented by Marcus Helt, Esq.
MUSCLEPHARM CORP: Taps Additon as Special IP Counsel
----------------------------------------------------
Musclepharm Corporation seeks approval from the U.S. Bankruptcy
Court for the District of Nevada to employ Additon, Pendleton &
Witherspoon, P.A. as special counsel.
The firm will provide intellectual property advice and services to
the Debtor, including the review of its trademarks to determine
whether they may be reinstated.
The firm will be paid at these rates:
Attorneys $250 to $400 per hour
Paraprofessionals $125 to $150 per hour
John Nipp, Esq., a partner at Additon, Pendleton & Witherspoon,
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:
John C. Nipp, Esq.
Additon, Pendleton & Witherspoon, P.A.
2605 W Roosevelt Blvd Suite B
Monroe, NC 28110
Tel: (704) 945-6700
About Musclepharm Corporation
Headquartered in Denver, Colorado, MusclePharm Corporation (OTCQB:
MSLP) -- http://www.musclepharm.com/and
http://www.musclepharmcorp.com/-- is a lifestyle company that
develops, manufactures, markets and distributes branded nutritional
supplements. It offers a broad range of performance powders,
capsules, tablets, gels and on-the-go ready to eat snacks that
satisfy the needs of enthusiasts and professionals alike.
MusclePharm filed a petition for relief under Subchapter V of
Chapter 11 of the Bankruptcy Code (Bankr. D. Nev. Case No.
22-14422) on Dec. 15, 2022. In the petition filed by its chief
executive officer, Ryan Drexler, the Debtor reported assets and
liabilities between $10 million and $50 million.
The Honorable Natalie M. Cox is the case judge.
The Debtor tapped Samuel A. Schwartz, Esq., at Schwartz Law, PLLC
as legal counsel; Foley & Lardner, LLP as special securities
counsel; and Portage Point Partners, LLC as restructuring advisor.
Jeffrey Gasbarra of Portage Point Partners serves as the Debtor's
chief restructuring officer.
The U.S. Trustee for Region 17 appointed an official committee to
represent unsecured creditors in the Debtor's case. Pachulski Stang
Ziehl & Jones, LLP and Larson &Zirzow, LLC serve as the committee's
bankruptcy counsel and Nevada counsel, respectively.
NEXERA MEDICAL: Bid to Use Cash Collateral Denied as Moot
---------------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Florida,
Fort Lauderdale Division, denied as moot the motion filed by Nexera
Medical, Inc. to use cash collateral on an interim basis in
accordance with the budget.
As previously reported by the Troubled Company Reporter, the Debtor
seeks to use cash collateral to fund day-to-day operations and
ultimately achieve a successful reorganization.
In early 2020 allegations as to kickbacks by members of the
company's previous Board of Directors arose and current director
James Magruder was brought in to manage the company.
Simultaneously, then President Donald Trump crippled the Debtor's
ability to import their brand of masks from China, which is where
they were previously being produced. Since then, their ability to
conduct business has been hampered by infighting with former board
members as well simply logistics. Recently, with one of the largest
shareholders providing financial support, the Debtor and the
current Board are seeking to resolve all outstanding Debts and
controversies and reorganize in the Chapter 11 proceeding.
The Debtor believes it has no valid secured creditors. However,
former board member James Morrell filed a UCC-1 on June 8, 2021
with the State of Florida reflecting financing of "all the debtors
tangible and intangible property, including intellectual property,
cash on-hand, future receivables, inventory, and office furniture."
The Debtor never authorized any such financing nor did it receive
any funding in return for granting such interests.
With knowledge of this erroneous UCC-1 filing and to avoid any
future cash collateral issues, counsel for the Debtor reached out
to Mr. Morrell who acknowledged the Debtor's position that the
UCC-1 was not valid. He further prepared and emailed counsel for
the Debtor a UCC-3 form terminating the original UCC-1 financing
statement.
An online search of the State of Florida UCC register does not
reflect that such filing has been received although it is
anticipated it will take a few days for the mailing to be completed
and for the form to be placed online.
A copy of the order is available at https://bit.ly/3M3eRqk from
PacerMonitor.com.
About NEXERA Medical, Inc.
NEXERA Medical, Inc. is in the business of producing and selling
reusable antimicrobial respiratory masks.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Fla. Case No. 23-13388) on April 28,
2023. In the petition signed by James Magruder, director, the
Debtor disclosed $155,521 in assets and $1,902,367 in liabilities.
Judge Scott M. Grossman oversees the case.
Jordan L. Rappaport, Esq., at Rappaport Osborne and Rappaport,
PLLC, represents the Debtor as legal counsel.
NIKOFAM INC: Seeks to Hire Madoff & Khoury as Bankruptcy Counsel
----------------------------------------------------------------
Nikofam, Inc. seeks approval from the U.S. Bankruptcy Court for the
District of Massachusetts to hire Madoff & Khoury, LLP to handle
its Chapter 11 case.
The hourly rates of the firm's attorneys and staff are as follows:
Partners $415
Associates $315
Paralegals $160
Administrative Staff $160
Madoff & Khoury received a retainer in the amount of $22,000, of
which $6,000 was used to pay for the firm's pre-bankruptcy
services.
David Madoff, Esq., a partner at Madoff & Khoury, disclosed in a
court filing that his firm is a "disinterested person" as that term
is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
David B. Madoff, Esq.
Madoff & Khoury, LLP
124 Washington Street, Suite 202
Foxborough, MA 02035
Telephone: (508) 543-0040
Facsimile: (508) 543-0020
Email: madoff@mandkllp.com
About Nikofam Inc.
Nikofam, Inc. owns and operates the Athens Pizza pizzeria. Since
2005 the Restaurant has operated out of its leased storefront in
East Weymouth, Massachusetts.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Mass. Case No. 23-10719) on May 5, 2023.
In the petition signed by Kiriaki Nikolaidis, president, the Debtor
disclosed up to $500,000 in both assets and liabilities.
David B. Madoff, Esq., at Madoff & Khoury LLP, represents the
Debtor as legal counsel.
NORDSTROM INC: Egan-Jones Retains B+ Senior Unsecured Ratings
-------------------------------------------------------------
Egan-Jones Ratings Company on May 5, 2023, maintained its 'B+'
foreign currency and local currency senior unsecured ratings on
debt issued by Nordstrom, Inc. EJR also withdraws 'A3' rating on
commercial paper issued by the Company.
Headquartered in Seattle, Washington, Nordstrom, Inc. is a fashion
retailer of apparel, shoes, and accessories for men, women, and
children.
NORRIS VENTURES: Seeks to Hire Thompson Law Group as Legal Counsel
------------------------------------------------------------------
Norris Ventures, LLC seeks approval from the U.S. Bankruptcy Court
for the Western District of Pennsylvania to hire Thompson Law
Group, P.C. as its counsel.
The firm will render these services:
(a) advise the Debtor regarding its powers and duties;
(b) take all necessary action to protect and preserve the
Debtor's estate;
(c) prepare legal papers; and
(d) perform all other legal services for the Debtor in
connection with its Chapter 11 case.
Thompson Law Group will charge $350 per hour for attorney and $90
per hour for paralegal.
In addition, the firm will seek reimbursement for expenses
incurred.
Prior to the petition date, the firm received a retainer of $5,000
from the Debtor.
Brian Thompson, Esq., an attorney at Thompson Law Group, disclosed
in a court filing that his firm is a "disinterested person" as that
term is defined in Section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Brian C. Thompson, Esq.
Thompson Law Group, PC
125 Warrendale Bayne Road, Suite 200
Warrendale, PA 15086
Telephone: (724) 799-8404
Facsimile: (724) 799-8409
Email: bthompson@thompsonattorney.com
About Norris Ventures
Norris Ventures, LLC filed a voluntary petition for relief under
Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No.
23-20939) on April 28, 2023. The petition was signed by Patrick M.
Norris, as owner and operator. At the time of filing, the Debtor
estimated up to $50,000 in assets and $500,001 - $1 million in
liabilities. Brian C. Thompson, Esq. at Thompson Law Group, P.C.
represents the Debtor as counsel.
NOVABAY PHARMACEUTICALS: Incurs $1.7M Net Loss in First Quarter
---------------------------------------------------------------
Novabay Pharmaceuticals, Inc. has filed with the Securities and
Exchange Commission its Quarterly Report on Form 10-Q disclosing a
net loss of $1.74 million on $3.12 million of net total sales for
the three months ended March 31, 2023, compared to a net loss of
$111,000 on $3.27 million of net total sales for the three months
ended March 31, 2022.
As of March 31, 2023, the Company had $14.82 million in total
assets, $5.93 million in total liabilities, and $8.89 million in
total stockholders' equity.
Novabay said, "The Company has sustained operating losses for the
majority of its corporate history and expects that its 2023
expenses will exceed its 2023 revenues, as the Company continues to
invest in both its Avenova and DERMAdoctor commercialization
efforts. Additionally, the Company expects to continue incurring
operating losses and negative cash flows until revenues reach a
level sufficient to support ongoing growth and operations.
Accordingly, the Company has determined that its planned operations
raise substantial doubt about its ability to continue as a going
concern. Additionally, changing circumstances may cause the Company
to expend cash significantly faster than currently anticipated, and
the Company may need to spend more cash than currently expected
because of circumstances beyond its control that impact the broader
economy such as periods of inflation, supply chain issues, the
continuation of the COVID-19 pandemic and international conflicts
(e.g., the conflict between Russia and Ukraine)."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1389545/000143774923013945/nby20230331_10q.htm
About Novabay
Headquartered in Emeryville, California, NovaBay Pharmaceuticals,
Inc. -- http://www.novabay.com-- develops and sells scientifically
created and clinically proven eyecare and skincare products.
NovaBay's leading product, Avenova Antimicrobial Lid & Lash
Solution, is often prescribed by eyecare professionals for
blepharitis and dry-eye disease and is also available directly to
eyecare consumers through online distribution channels such as
Amazon. DERMAdoctor offers more than 30 OTC dermatologist-developed
skincare products through the DERMAdoctor website, well-known
traditional and digital beauty retailers, and international
distributors. NovaBay also manufactures and sells effective, yet
gentle and non-irritating wound care products.
Novabay reported a net loss of $10.61 million for the year ended
Dec. 31, 2022, a net loss and comprehensive loss of $5.82 million
for the year ended Dec. 31, 2021, a net loss and comprehensive loss
of $11.04 million for the year ended Dec. 31, 2020, a net loss and
comprehensive loss of $9.66 million for the year ended Dec. 31,
2019, and a net loss and comprehensive loss of $6.54 million for
the year ended Dec. 31, 2018.
San Francisco California-based WithumSmith+Brown, PC, the Company's
auditor since 2010, issued a "going concern" qualification in its
report dated March 31, 2023, citing that the Company has a history
of recurring losses and negative cash flows from operations that
raise substantial doubt about its ability to continue as a going
concern.
NOVUSON SURGICAL: Court OKs Interim Cash Collateral Access
----------------------------------------------------------
The U.S. Bankruptcy Court for the Western District of Washington,
at Seattle, authorized Novuson Surgical, Inc. to use cash
collateral on an interim basis in accordance with the budget.
Novuson requires the immediate use of cash collateral to continue
its ongoing operations in the ordinary course of business and to
avoid disruption of such operations.
As of the Petition Date, the Debtor was indebted to Headway
Capital, LLC in the approximate amount of $56,885, pursuant to the
Business-Use Line of Credit and Security Agreement.
The Debtor also was indebted to Sam Liao in the approximate amount
of $7,500, pursuant to a Promissory Note and Security Agreement.
The Debtor also owed Stuart Mitchell in the approximate amount of
$50,000, pursuant to a Promissory Note and Security Agreement.
The Debtor submits that Headway, Liao, and Mitchell do not have
enforceable security interests against the Debtor's cash
collateral.
As adequate protection, the Lenders are granted replacement liens
in the Debtor's post-petition cash, accounts receivable and
inventory, and the proceeds of each of the foregoing, to the same
extent and priority as any duly perfected and unavoidable liens in
cash collateral held by the Lenders as of the Petition Date.
The Debtor is not required to provide any additional adequate
protection for the diminution of interest that the Lenders may hold
in prepetition collateral during the term of the Interim Order.
A final hearing on the matter is available at June 9, 2023 at 11
a.m.
A copy of the order is available at https://bit.ly/3pGjPln from
PacerMonitor.com.
About Novuson Surgical
Novuson Surgical, Inc., a company in Bothell, Wash., filed a
petition under Chapter 11, Subchapter V of the Bankruptcy Code
(Bankr. W.D. Wash. Case No. 23-10728) on April 21, 2023, with
$100,000 to $500,000 in assets and $1 million to $10 million in
liabilities. Stuart B. Mitchell, president of Novuson Surgical,
signed the petition.
Judge Timothy W. Dore oversees the case.
Aditi Paranjpye, Esq., at Cairncross & Hempelmann, P.S., is the
Debtor's counsel.
OPULENT VACATIONS: Has Deal on Cash Collateral Access
-----------------------------------------------------
Opulent Vacations, Inc. asks the U.S. Bankruptcy Court for the
District of Utah, Central Division, to approve its stipulation for
the use of cash collateral with the U.S. Small Business
Administration.
The Debtor needs to use cash collateral to pay current operating
expenses including payroll, vendor services, professionals' fees or
retainers, and other necessary expenses incurred in its business
and as necessary for the Debtor's bankruptcy case.
On April 22, 2020, the Debtor executed a promissory note in favor
of the SBA in the original principal amount of $500,000, with
interest accruing at 3.75% per annum. The SBA Note was to be
repaid over 30 years, with monthly payments of $2,437.
As of May 12, 2023, the Debtor is obligated to the SBA under the
Note in the principal amount of $500,000 with accrued interest of
$47,273 for a total amount of $547,273. Interest continues to
accrue on the principal balance at the rate of $51.37 per day.
On April 22, 2020, as security for the SBA Note, the Debtor
executed a security agreement in favor of the SBA and on May 8,
2020, the SBA filed a UCC-1 Initial Financing Statement with the
State of Utah, Department of Commerce, Division of Corporations and
Commercial Code, which provides for a lien and security interest in
all tangible and intangible personal property.
The Stipulation provides for the Debtor's use of cash collateral to
pay current operating expenses including payroll, vendor services,
professionals' fees or retainers, and other necessary expenses
incurred in its business and as necessary for the Debtor's
bankruptcy case, and provides for adequate protection to the SBA
for its consent to the same.
To provide adequate protection for the SBA's secured claim during
the term of the agreement, the Debtor and the SBA have agreed
that:
a. The SBA will be granted a replacement lien on all
post-petition tangible and intangible property that constitutes
Collateral, solely to the extent that the Debtor's use of cash
collateral results in a diminution in the amount or value of the
SBA's secured claim. This lien and security agreement will be in
addition to the liens that the SBA had in the assets and property
of the Debtor as of the petition date, which liens extend to and
encumber the proceeds and products of the property of the Debtor in
existence as of the Petition Date.
b. The Debtor acknowledges that the Financing Statement
constitutes a valid, properly perfected, and enforceable lien and
security interest in the Collateral.
c. The Debtor represents that all funds collected during the
pendency of the case will be deposited either (a) in such bank
accounts as are authorized by the Court, or (b) one or more
debtor-in-possession accounts, and that all expenses of the Debtor
during the pendency of this case will be paid from such accounts or
as otherwise authorized by the Court.
d. The Debtor's treatment of the SBA's secured claim will be
in accordance with the terms of its yet-to-be proposed chapter 11
plan.
e. The SBA expressly consents to the Debtor's use of the
Collateral to pay prepetition date retainer funds to the Debtor's
counsel in the amount of $30,000 and waives any right to seek
disgorgement or the return thereof.
A copy of the motion is available at https://bit.ly/42Jj7CN from
PacerMonitor.com.
About Opulent Vacations, Inc.
Opulent Vacations, Inc. offers high-end luxury vacation homes in
scenic destinations like Park City, Lake Tahoe, Palm Springs, San
Diego, and more.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Utah Case No. 23-21941) on May 15, 2023.
In the petition signed by Jeff Jenson, chief executive officer, the
Debtor disclosed up to $10 million in assets and liabilities.
Judge Joel T. Marker oversees the case.
Jeffrey L. Trousdale, Esq., at Cohne Kinghorn, PC, represents the
Debtor as legal counsel.
OUTPUT SERVICES: $180.3M Bank Debt Trades at 57% Discount
---------------------------------------------------------
Participations in a syndicated loan under which Output Services
Group Inc is a borrower were trading in the secondary market around
42.6 cents-on-the-dollar during the week ended Friday, May 19,
2023, according to Bloomberg's Evaluated Pricing service data.
The $180.3 million facility is a Term loan that is scheduled to
mature on June 27, 2026. The amount is fully drawn and
outstanding.
Output Services Group, Inc. offers printing services.
OUTPUT SERVICES: $369.8M Bank Debt Trades at 57% Discount
---------------------------------------------------------
Participations in a syndicated loan under which Output Services
Group Inc is a borrower were trading in the secondary market around
42.6 cents-on-the-dollar during the week ended Friday, May 19,
2023, according to Bloomberg's Evaluated Pricing service data.
The $369.8 million facility is a Term loan that is scheduled to
mature on June 27, 2026. The amount is fully drawn and
outstanding.
Output Services Group, Inc. offers printing services.
PALMS GOLF CLUB: Case Summary & 20 Largest Unsecured Creditors
--------------------------------------------------------------
Debtor: The Palms Golf Club, Inc.
57000 Palms Drive
La Quinta, CA 92253
Business Description: The Palms Golf Club is a single membership
organization with an old-style golf club
structure.
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
Central District of California
Case No.: 23-12125
Debtor's Counsel: Marc C. Forsythe, Esq.
Reem J. Bello, Esq.
Brandon J Iskander, Esq.
GOE FORSYTHE & HODGES LLP
17701 Cowan
Building D, Suite 210
Irvine, CA 92614
Tel: (949) 798-2460
Fax: (949) 955-9437
Email: mforsythe@goeforlaw.com
rbellow@goeforlaw.com
biskander@goeforlaw.com
Estimated Assets: $1 million to $10 million
Estimated Liabilities: $1 million to $10 million
The petition was signed by Peter David Baucom as GM/COO.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/PDOPW2Y/The_Palms_Golf_Club_Inc__cacbke-23-12125__0001.0.pdf?mcid=tGE4TAMA
PECF USS INTERMEDIATE: $2B Bank Debt Trades at 23% Discount
-----------------------------------------------------------
Participations in a syndicated loan under which PECF USS
Intermediate Holding III Corp is a borrower were trading in the
secondary market around 77.4 cents-on-the-dollar during the week
ended Friday, May 19, 2023, according to Bloomberg's Evaluated
Pricing service data.
The $2 billion facility is a Term loan that is scheduled to mature
on December 15, 2028. About $1.98 billion of the loan is withdrawn
and outstanding.
PECF USS Intermediate Holding III Corporation is the issuing
entity
for a debt extended to United Site Services Inc., a provider of
portable sanitation and related site services.
PEDIATRIC ASSOCIATES: Moody's Rates New $125MM 1st Lien Loan 'B2'
-----------------------------------------------------------------
Moody's Investors Service assigned B2 rating to Pediatric
Associates Holding Company, LLC's proposed $125 million incremental
first lien term loan. All other ratings, including the B2 Corporate
Family Rating, B2-PD Probability of Default Rating, B2 ratings on
the existing first lien senior secured credit facilities are
unchanged. The outlook is stable.
Proceeds from the incremental first lien term loan will be used to
add cash to the balance sheet that will be used to fund future
acquisitions and investments in new facilities. The incremental
financing will increase leverage, by a quarter of a turn to roughly
3.8 times (pro forma for the transaction for FYE 2022). The
proposed incremental term loan also signals that Pediatric
Associates will continue to use debt to fund its future growth.
That said, leverage is well within the triggers and the financing
will improve liquidity by increasing cash to the balance sheet.
Assignments:
Issuer: Pediatric Associates Holding Company, LLC
Senior Secured 1st Lien Term Loan, Assigned B2
RATINGS RATIONALE
The B2 CFR reflects the company's moderately high financial
leverage, with Moody's-adjusted debt/EBITDA around 3.8 times pro
forma for the proposed transaction. The rating is also constrained
by the company's modest scale and significant concentration in two
states, Florida and Texas. Further, Moody's expects Pediatric
Associates will continue to actively expand through acquisitions
that will be funded with a mix of excess cash and additional debt
for larger transactions.
Pediatric Associates benefits from its solid position in the highly
fragmented pediatric care market which offers solid growth
prospects and good profitability. Despite some exposure to direct
government reimbursement (about 48% of revenue is from Managed
Medicaid), the company benefits from commercial payor
diversification, predictable revenue from capitation contracts with
commercial payors, and a seasoned executive team.
Pediatric Associates will maintain good liquidity over the next
12-18 months, with no near-term debt maturities. Liquidity is
supported by the undrawn $100 million revolving credit facility and
$135 million of pro forma cash. Moody's forecasts Pediatric
associates will generate around $100 million of free cash flow in
2023. The $100 million revolving credit facility has a springing
First Lien Net Leverage Covenant of 7.0x when 35% drawn. Moody's
does not expect Pediatric Associates to rely on the revolving
credit facility, but anticipates that it would maintain adequate
cushions if used. Alternative sources of liquidity are limited as
substantially all assets are pledged. There is no financial
covenant on the term loans.
Pediatric Associates Holding Company, LLC's CIS-4 indicates that
the rating is lower than it would have been if ESG risk exposures
did not exist. Pediatric Associates is exposed to social risks as a
healthcare service provider (S-4) which include demographic and
societal trends such as the rising concerns around the access and
affordability of healthcare services. Pediatric Associates is
mostly reliant on commercial insurance, but still has exposure to
government payors. Pediatric Associates is also exposed to labor
pressures and human capital constraints as the company relies on
highly specialized labor to provide its services. Pediatric
Associates has exposure to governance risk considerations (G-4)
reflecting the company's rapid expansion strategy as it grows,
through a combination of new clinic openings and acquisitions. In
addition, Pediatric Associates has exposure to physical climate
risks (E-4) due to geographic concentration is Florida and Texas.
In its stable outlook, Moody's expects that Pediatric Associates
will operate with a leverage between 4.0-5.0x over the next 12-18
months and will prudently manage its expansion and cash.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATING
The ratings could be downgraded if Pediatric Associates' operating
performance deteriorates, liquidity weakens, or if the company
experiences material integration related disruptions. Additionally,
the ratings could be downgraded if Moody's expects debt/EBITDA to
be sustained above 5.5 times. Further, debt-funded shareholder
returns or other aggressive financial policies could also result in
a downgrade.
The ratings could be upgraded if Pediatric Associates demonstrates
a track record of positive free cash flow, and effectively manages
its growth with prudent financial policies. Increased scale and
diversification would also support an upgrade. Further, the ratings
could be upgraded if adjusted debt to EBITDA is sustained below 4.0
times.
Pediatric Associates Holding Company, LLC ("Pediatrics Associates")
is the largest pediatric practice management company in the highly
fragmented U.S. pediatric market. The company employs over 1,000
clinicians seeing over 4 million annual visits across 7 states (276
locations). Pediatric Associates Holding Company, LLC offers
primary and specialty care, laboratory, diagnostic and care
management services, as well as 24/7 telehealth access. Pediatric
Associates Holding Company, LLC reported revenue of $726 million
FYE 2022. Pediatric Associates Holding Company, LLC is owned by
Summit Partners and TPG Capital.
The principal methodology used in this rating was Business and
Consumer Services published in November 2021.
PETES AUTO SALES: Hires Grafstein & Arcaro as Bankruptcy Counsel
----------------------------------------------------------------
Petes Auto Sales & Service, LLC seeks approval from the U.S.
Bankruptcy Court for the District of Connecticut to hire Grafstein
& Arcaro, LLC as its counsel.
The firm will render these legal services:
(a) advise the Debtor regarding its rights, duties, and powers
in the operation and management of its business and property;
(b) advise and assist the Debtor with respect to financial
agreements, debt restructuring, cash collateral orders, and other
financial transactions;
(c) review and advise the Debtor regarding the validity liens
asserted against the Debtor's property;
(d) advise the Debtor as to actions to collect and recover
property for the benefit of the Debtor's estate;
(e) prepare legal papers;
(f) advise the Debtor in connection with all aspects of a plan
of reorganization and related documents; and
(g) perform all other legal services for the Debtor which may
be necessary in this Chapter 11 case.
The hourly rates of the firm's counsel and staff are as follows:
Attorneys $400
Staff $100
In addition, the firm will seek reimbursement for expenses
incurred.
The firm is not holding a retainer.
Gregory Arcaro, Esq., an attorney at Grafstein & Arcaro, disclosed
in a court filing that the firm is a "disinterested person" as that
term is defined in section 101(14) of the Bankruptcy Code.
The firm can be reached through:
Gregory F. Arcaro, Esq.
Grafstein & Arcaro, LLC
1 Regency Drive, Suite 200B
Bloomfield, CT 06002
Telephone: (860) 242-0574
Facsimile: (860) 676-9168
Email: garcaro@grafsteinlaw.com
About Petes Auto Sales
Petes Auto Sales & Service, LLC, also known as Pete's Auto Sales &
Service, LLC, filed a petition under Chapter 11, Subchapter V of
the Bankruptcy Code (Bankr. D. Conn. Case No. 23-20344) on May 5,
2023. At the time of the filing, the Debtor reported $100,001 to
$500,000 in both assets and liabilities.
Judge James J. Tancredi oversees the case.
The Debtor is represented by Gregory F. Arcaro, Esq., at Grafstein
& Arcaro, LLC.
PIERLO INC: Case Summary & Six Unsecured Creditors
--------------------------------------------------
Debtor: Pierlo, Inc.
d/b/a Baker's Travertine Power Clean
422 S. Madison Dr., Suite 1
Tempe, AZ 85281
Business Description: Pierlo provides cleaning, finishing,
polishing and sealing systems for
Travertine, Marble, and Limestone.
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
District of Arizona
Case No.: 23-03341
Judge: Hon. Eddward P. Ballinger Jr.
Debtor's Counsel: Thomas H. Allen, Esq.
ALLEN, JONES & GILES, PLC
1850 N. Central Avenue, Suite 1150
Phoenix, AZ 85004
Tel: 602-256-6000
Fax: 602-252-4712
Email: tallen@bkfirmaz.com
Total Assets: $72,245
Total Liabilities: $1,474,574
The petition was signed by Robert Michael Vuolo Jr. as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's six unsecured creditors is available for free
at PacerMonitor.com at:
https://www.pacermonitor.com/view/TRCVBLI/PIERLO_INC__azbke-23-03341__0001.0.pdf?mcid=tGE4TAMA
PORTER'S PENINSULA: Case Summary & Three Unsecured Creditors
------------------------------------------------------------
Debtor: Porter's Peninsula Logging LLC
17985 Fourth Street
Atlanta, MI 49709
Business Description: The Debtor operates a logging business.
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
Eastern District of Michigan
Case No.: 23-20563
Judge: Hon. Daniel S. Oppermanbaycity
Debtor's Counsel: Rozanne M. Giunta, Esq.
WARNER NORCROSS & JUDD, LLP
715 E. Main Street
Suite 110
Midland, MI 48640-5382
Tel: 989-698-3758
Email: rgiunta@wnj.com
Estimated Assets: $100,000 to $500,000
Estimated Liabilities: $1 million to $10 million
The petition was signed by Todd M. Porter as sole member.
A copy of the Debtor's list of three unsecured creditors is
available for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/TEMTMCY/Porters_Peninsula_Logging_LLC__miebke-23-20563__0003.0.pdf?mcid=tGE4TAMA
A full-text copy of the petition is available for free at
PacerMonitor.com at:
https://www.pacermonitor.com/view/S5CVXBY/Porters_Peninsula_Logging_LLC__miebke-23-20563__0001.0.pdf?mcid=tGE4TAMA
PROJECT LEOPARD: S&P Downgrades ICR to 'B-', Outlook Stable
-----------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on U.S.-based
provider of business process and document management software
Project Leopard Holdings Inc. (Kofax) to 'B-' from 'B' and its
issue-level rating on the first-lien term loan to 'B-' from 'B'.
S&P also lowered its rating on the second-lien term to 'CCC' from
'CCC+'.
S&P said, "The stable outlook reflects our expectation that
leverage will be in the low-7x area by the end of 2023 with EBITDA
margins in the 40% area from lower acquisition-related costs and
cost synergies from prior bolt-on acquisitions. We also expect
generally flat organic revenues from the continued transition
towards recurring revenues and the potential adverse impact of a
weaker global economy on bookings, as well as slight negative FOCF
from high interest rates.
"We expect slight negative FOCF in 2023 due to greater interest
payments and the recurring revenue transition, but liquidity
remains sufficient. The rating action reflects our expectation of
weak FOCF generation over at least the next two years. With Kofax's
greater debt balance following the secondary buyout transaction
last year and a large increase in interest rates over the last 12
months, we now expect cash interest payments to increase to $170
million-$180 million in 2023 from $120 million-$130 million in 2022
and just above $75 million in 2021. At the same time, Kofax is
undergoing a transition towards a greater mix of recurring revenues
that we expect to result in flat organic revenues in 2023 and lower
FOCF generation until new recurring contributions and renewals
exceed lost perpetual license and related maintenance and
professional service revenues. We thus expect negative FOCF of up
to $8 million in 2023 and a return to modest positive FOCF of $27
million-$32 million in 2024 (equivalent to FOCF to debt of 1%-2%).
We consider these metrics to be below our expectations for the 'B'
rating. However, we note that Kofax has more than enough liquidity
as of the end of 2022, with a cash balance of just under $50
million, a $150 million revolving credit facility (RCF) maturing in
2027, and no near-term debt maturities.
"We expect leverage to improve to just above 7x in 2023 helped by
cost savings and lower acquisition-related costs. We expect the
full-year contributions of Tungsten Corp. and Ephesoft Inc.
(acquired in 2022), the realization of synergies related to these
acquisitions, general cost efficiencies, and lower
acquisition-related costs to support EBITDA margins in the low-40%
area and leverage in the low-7x area in 2023. This is despite
company investments in customer success and experience teams to
support the recurring revenue transition. We believe leverage could
reduce below 7x in 2024 if the company returns to organic revenue
growth from greater recurring revenue contributions. In the long
run, we believe there is the potential for greater operating
leverage in the business and more cash flow visibility as the
recurring revenue mix increases. However, we still believe the
transition involves execution risks around minimizing customer
churn without excessive operating expense investments.
"The stable outlook reflects our expectation that leverage will be
in the low-7x area by the end of 2023 with EBITDA margins in the
40% area from lower acquisition-related costs and cost synergies
from bolt-on acquisitions in 2022. We also expect generally flat
organic revenues from the continued transition towards recurring
revenues and the potential adverse impact of a weaker global
economy on bookings, as well as slight negative FOCF from high
interest rates."
S&P could lower its rating if it considers Kofax's capital
structure to be unsustainable, which could be due to the
following:
-- Kofax experiences sustained organic revenue declines or
worse-than-expected EBITDA margins, perhaps because of weak
customer demand, competitive pressures, or impaired sales execution
around its recurring revenue transition; or
-- S&P expects sustained negative FOCF, EBITDA interest coverage
approaching 1x, or reducing covenant headroom such that it has
increasing concerns about long-term liquidity.
S&P could raise the rating if:
-- S&P believes Kofax is on track to successfully execute its
transition to more recurring revenues and return to revenue growth,
while maintaining EBITDA margins above 40%; and
-- S&P considers the company able to improve and maintain leverage
below 7x and FOCF to debt above the low-single-digit percent area,
as well as a financial policy that supports these metrics.
ESG credit indicators: E-2, S-2, G-3
PROTECH FIRE: Case Summary & 20 Largest Unsecured Creditors
-----------------------------------------------------------
Debtor: ProTech Fire & Security, LLC
15353 Village Pkwy East
Houston TX 77032
Business Description: ProTech Fire installs, monitors and
maintains fire and security alarms,
surveillance systems, access control, voice
and data solutions, bi-directional antenna
BDA and a host of other ancillary products
and services for general contractors,
architects, property managers and end users
in the State of Texas.
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
Southern District of Texas
Case No.: 23-31839
Judge: Hon. Eduardo V. Rodriguez
Debtor's Counsel: Julie M. Koenig, Esq.
COOPER & SCULLY, P.C.
815 Walker St.
Suite 1040
Houston TX 77002
Tel: (713) 236-6800
Email: julie.koenig@cooperscully.com
Total Assets: $453,929
Total Liabilities: $1,896,142
The petition was signed by Garrett Steiger as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/GZBD6DI/ProTech_Fire__Security_LLC__txsbke-23-31839__0001.0.pdf?mcid=tGE4TAMA
PROVECTUS BIOPHARMACEUTICALS: Incurs $827K Net Loss in 1st Quarter
------------------------------------------------------------------
Provectus Biopharmaceuticals, Inc. has filed with the Securities
and Exchange Commission its Quarterly Report on Form 10-Q
disclosing a net loss of $827,454 on $205,025 of grant revenue for
the three months ended March 31, 2023, compared to a net loss of
$1.03 million on $187,605 of grant revenue for the three months
ended March 31, 2022.
As of March 31, 2023, the Company had $1.72 million in total
assets, $8.72 million in total liabilities, and a total
stockholders' deficit of $7 million.
Provectus said, "Management expects that significant on-going
operating expenditures will be necessary to successfully implement
the Company's business plan and develop and market its products.
These circumstances raise substantial doubt about the Company's
ability to continue as a going concern within one year after the
date that these unaudited condensed consolidated financial
statements are issued. Implementation of the Company's plans and
its ability to continue as a going concern will depend upon the
Company's ability to develop PV-10, PH-10, and/or any other
halogenated xanthene-based drug products, and to raise additional
capital."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/315545/000149315223016356/form10-q.htm
About Provectus
Provectus Biopharmaceuticals, Inc. is a clinical-stage
biotechnology company developing immunotherapy medicines based on a
family of small molecules called halogenated xanthenes. The
Company's lead HX molecule is rose bengal sodium.
Provectus reported a net loss of $3.55 million for the year ended
Dec. 31, 2022, compared to a net loss of $5.54 million for the year
ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $2.04
million in total assets, $8.26 million in total liabilities, and a
total stockholders' deficit of $6.23 million.
Los Angeles, CA-based Marcum LLP, the Company's auditor since 2016,
issued a "going concern" qualification in its report dated March
29, 2023, citing that the Company has a significant working capital
deficit, has incurred significant losses and needs to raise
additional funds to meet its obligations and sustain its
operations. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
RACKSPACE TECHNOLOGY: $2.30B Bank Debt Trades at 61% Discount
-------------------------------------------------------------
Participations in a syndicated loan under which Rackspace
Technology Global Inc is a borrower were trading in the secondary
market around 39.3 cents-on-the-dollar during the week ended
Friday, May 19, 2023, according to Bloomberg's Evaluated Pricing
service data.
The $2.30 billion facility is a Term loan that is scheduled to
mature on February 9, 2028. About $2.25 billion of the loan is
withdrawn and outstanding.
Rackspace Technology Global, Inc., supports and manages cloud
platforms, as well as offers managed hosting, colocation,
security,
data processing, and enterprise application development.
RESCOM LTD: Court OKs Interim Cash Collateral Access
----------------------------------------------------
The U.S. Bankruptcy Court for the Southern District of Ohio,
Western Division, authorized Rescom, Ltd. to use cash collateral on
an interim basis in accordance with the budget.
The Debtor requires the use of cash collateral to continue funding
its necessary business expenses and fund the costs associated with
the administration of the Chapter 11 case.
Prior to the commencement of the Case, Minster Bank was the
Debtor's primary bank. The Debtor's obligations to Minster Bank
were evidenced, in part, by the following: (1) Promissory Note
dated September 20, 2012, in the face principal amount of $59,338;
(2) Promissory Note dated as of February 22, 2018, in the face
principal amount of $54,750; (3) Promissory Note dated as of
February 22, 2018, in the face principal amount of $63,750; (4)
Promissory Note dated as of February 22, 2018, in the face
principal amount of $56,250; and all such other business loan
agreements, security agreements, assignments of rents, and other
instruments, documents and other papers executed in connection
therewith or relating thereto, including as amended. The loans
evidenced by the Senior Secured Loan Documents have been declared
in default. The total principal indebtedness claimed to be owing to
Minster Bank under the Senior Secured Loan Documents, as of the
Petition Date, is approximately $145,850.
As adequate protection, Minster Bank is granted valid, continuing,
binding, enforceable, unavoidable and perfected first priority
replacement liens upon and security interests in all of Debtor's
presently owned, leased, or hereafter acquired property and assets
of the Debtor.
The Debtor will maintain adequate insurance covering Minster Bank's
collateral, including casualty loss, of which insurance Minster
Bank will be an additional named insured as to its interests as set
forth therein.
In addition to the Senior Replacement Liens granted, Minster Bank
is granted administrative expense claims, in the priority of its
respective liens, in the amount by which the adequate protection
afforded above proves to be inadequate, to protect Minster Bank
from any post-petition diminution in value of the Collateral, which
in no event will be greater than the amount of Minster Bank's
claim. This administrative claim will be allowed and have
superpriority over all other costs and expenses of the kind, and
will be payable from and have recourse to all prepetition and
post-petition property of the Debtor and all proceeds thereof.
A final hearing on the matter is set for June 7 at 9:30 a.m.
A copy of the order is available at https://bit.ly/43kKbZ1 from
PacerMonitor.com.
About Rescom, Ltd.
Rescom, Ltd. sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. S.D. Ohio Case No. 23-30540) on April 7,
2023. In the petition signed by Duaine Liette, sole member, the
Debtor disclosed up to $1 million in both assets and liabilities.
Judge Guy R. Humphrey oversees the case.
Paul H. Shaneyfelt, Esq., at Shaneyfelt & Associates, LLC,
represents the Debtor as legal counsel.
RESEARCH NOW: $250M Bank Debt Trades at 48% Discount
----------------------------------------------------
Participations in a syndicated loan under which Research Now Group
LLC is a borrower were trading in the secondary market around 52.5
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $250 million facility is a Term loan that is scheduled to
mature on December 20, 2025. The amount is fully drawn and
outstanding.
Headquartered in Plano, Texas, Research Now Group, LLC (formerly
Research Now Group, Inc.) and its subsidiary Dynata, LLC (formerly
Survey Sampling International, LLC), provides data collection
services through online, mobile and offline surveys used by market
research firms, consulting firms and corporate customers.
REVERE POWER: $445M Bank Debt Trades at 26% Discount
----------------------------------------------------
Participations in a syndicated loan under which Revere Power LLC is
a borrower were trading in the secondary market around 73.8
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $445 million facility is a Term loan that is scheduled to
mature on March 29, 2026. About $422 million of the loan is
withdrawn and outstanding.
Revere Power LLC is a project-financed entity that wholly owns and
controls three combined cycle gas plants in New England with a
combine winter capacity of 1,143 megawatts (MW).
REVERE POWER: $70M Bank Debt Trades at 27% Discount
---------------------------------------------------
Participations in a syndicated loan under which Revere Power LLC is
a borrower were trading in the secondary market around 73.3
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $70 million facility is a Term loan that is scheduled to mature
on March 29, 2026. About $37 million of the loan is withdrawn and
outstanding.
Revere Power LLC is a project-financed entity that wholly owns and
controls three combined cycle gas plants in New England with a
combine winter capacity of 1,143 megawatts (MW).
RICE ENTERPRISES: Seeks to Hire Hardin Thompson as Special Counsel
------------------------------------------------------------------
Rice Enterprises, LLC seeks approval from the U.S. Bankruptcy Court
for the Western District of Pennsylvania to employ Hardin Thompson
P.C., as its special counsel.
The firm will represent the Debtor in matters related to the
Removed Action styled as L.H., a minor, by and through her parents
and guardians, T.H. and B.H. v. Rice Enterprises, LLC, et al.,
bearing case number GD No. 21-011435, in the Court of Common Pleas
of Allegheny County, Pennsylvania.
The firm's hourly rates are:
Kenneth J. Hardin, II $450
Kara Lattanzio $350
As disclosed in the court filings, Hardin Thompson represents no
interest adverse to the Debtor or the estate in the matters upon
which they are to be engaged for the Debtor.
The firm can be reached through:
Ken Hardin, Esq.
Hardin Thompson, P.C.
The Frick Building
437 Grant Street, Suite 620
Pittsburgh, PA 15219
Phone: 412-944-2166
About Rice Enterprises
Rice Enterprises, LLC operates in the restaurants industry.
Rice Enterprises, LLC, filed a petition for relief under Subchapter
V of Chapter 11 of the Bankruptcy Code (Bankr. W.D. Pa. Case No.
2:23-bk-20556) on March 15, 2023. In the petition signed by
Michele Rice, sole member, the Debtor disclosed up to $50 million
in assets and up to $10 million in liabilities.
Kirk B. Burkley, Esq., at Bernstein-Burkley, PC, represents the
Debtor as legal counsel.
SANUWAVE HEALTH: Incurs $13.1 Million Net Loss in First Quarter
---------------------------------------------------------------
SANUWAVE Health, Inc. has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
of $13.08 million on $3.77 million of revenue for the three months
ended March 31, 2023, compared to a net loss of $5.10 million on
$3.19 million of revenue for the three months ended March 31,
2022.
As of March 31, 2023, the Company had $17.50 million in total
assets, $71.29 million in total liabilities, and a total
stockholders' deficit of $53.79 million.
SANUWAVE said, "Since inception, we have incurred losses from
operations each year. As of March 31, 2023, we had an accumulated
deficit of $207 million. Historically, our operations have
primarily been funded from the sale of capital stock, notes
payable, and convertible debt securities. The recurring losses
from operations, the events of default on our notes payable, and
dependency upon future issuances of equity or other financing to
fund ongoing operations have raised substantial doubt as to our
ability to continue as a going concern for a period of at least
twelve months from the filing of this Form 10-Q. We expect to
devote substantial resources for the commercialization of UltraMIST
and PACE systems which will require additional capital resources to
remain a going concern.
"Management's plans are to obtain additional capital in 2023
through the conversion of outstanding warrants, issuance of common
or preferred stock, securities convertible into common stock, or
secured or unsecured debt. These possibilities, to the extent
available, may be on terms that result in significant dilution to
our existing stockholders. In addition, there can be no assurances
that our plans to obtain additional capital will be successful on
the terms or timeline we expect, or at all. If these efforts are
unsuccessful, we may be required to significantly curtail or
discontinue operations or, if available, obtain funds through
financing transactions with unfavorable terms."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1417663/000114036123024124/brhc20052671_10q.htm
About SANUWAVE Health
Headquartered in Suwanee, Georgia, SANUWAVE Health, Inc.
(OTCQB:SNWV) -- http://www.SANUWAVE.com-- is a shock wave
technology company using a patented system of noninvasive,
high-energy, acoustic shock waves for regenerative medicine and
other applications. The Company's initial focus is regenerative
medicine utilizing noninvasive, acoustic shock waves to produce a
biological response resulting in the body healing itself through
the repair and regeneration of tissue, musculoskeletal, and
vascular structures.
SANUWAVE reported a net loss of $10.29 million for the year ended
Dec. 31, 2022, compared to a net loss of $27.26 million for the
year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$19.87 million in total assets, $60.88 million in total
liabilities, and a total stockholders' deficit of $41.01 million.
New York, NY-based Marcum LLP, the Company's auditor since 2018,
issued a "going concern" qualification in its report dated March
31, 2023, citing that the Company has incurred recurring losses and
needs to raise additional funds to meet its obligations and sustain
its operations and the occurrence of the events of default on the
Company's debt. These conditions raise substantial doubt about the
Company's ability to continue as a going concern.
SERTA SIMMONS: $851M Bank Debt Trades at 44% Discount
-----------------------------------------------------
Participations in a syndicated loan under which Serta Simmons
Bedding LLC is a borrower were trading in the secondary market
around 55.7 cents-on-the-dollar during the week ended Friday, May
19, 2023, according to Bloomberg's Evaluated Pricing service data.
The $851 million facility is a Term loan that is scheduled to
mature on August 10, 2023. The amount is fully drawn and
outstanding.
Serta Simmons Bedding, LLC manufactures bedding products. The
Company offers blankets, sheets, bed frames, mattress protectors,
and accessories.
SERTA SIMMONS: Fine-Tunes Plan Documents
----------------------------------------
Serta Simmons Bedding, LLC, et al., submitted a Modified First
Amended Joint Chapter 11 Plan dated May 14, 2023.
The Plan groups the Debtors together solely for the purpose of
describing treatment under the Plan, confirmation of the Plan, and
making distributions in respect of Claims against and Interests in
the Debtors under the Plan.
No later than 120 days following the Effective Date, the New Board,
subject to its fiduciary duties, shall adopt the Management
Incentive Plan. The New Board shall determine allocations under the
Management Incentive Plan, up to, in the aggregate, 8% of the New
Common Interests set aside pursuant to the Management Incentive
Plan, distributed on a fully diluted basis (including shares
issuable under any employee incentive plan).
Following the Effective Date, the PTL Lenders shall be indemnified
by the Reorganized Debtors with respect to all present and future
actions, suits, and proceedings against the PTL Lenders or their
respective Related Parties in connection with or related to the
Adversary Proceeding, the Prepetition Adversary Actions, and/or any
other claims, proceedings, actions, or causes of action in
connection with or related to the PTL Credit Agreement, the
Exchange Agreement, the Intercreditor Agreements, and/or the 2020
Transaction on the same terms and limitations as afforded under the
PTL Credit Agreement and New Term Loan Credit Facility.
Like in the prior iteration of the Plan, each holder of an Allowed
Ongoing General Unsecured Claim shall receive, with a carve out
from the collateral (or the value of such collateral) securing the
FLSO Claims, full payment in the Allowed amount of such Ongoing
General Unsecured Claim no later than the date that is 60 days from
the later of the Effective Date and the execution of the 6A Trade
Agreement, notwithstanding any distribution schedule agreed to in a
6A Trade Agreement or CV Trade Agreement.
Except to the extent that a holder of Class 6B Allowed Other
General Unsecured Claim agrees to less favorable treatment, each
holder of an Allowed Other General Unsecured Claim shall receive,
in full and final satisfaction of such Claim, with a carve out from
the collateral (or the value of such collateral) securing the FLSO
Claims, its Pro Rata Share of the Class 6B Trust Interests, as set
forth in the GUC Recovery Allocation Table.
The treatment provided to Allowed Ongoing General Unsecured Claims
and Allowed Other General Unsecured Claims under the Plan, together
with the other terms and conditions set forth in the Plan and the
Confirmation Order, incorporates and reflects a proposed integrated
compromise and settlement by and among the Debtors, the Creditors'
Committee, and the Requisite Consenting Creditors, pursuant to the
Creditors' Committee Global Settlement, including all disputes
raised or asserted by the Creditors' Committee including, but not
limited to those set forth in the letter dated April 4, 2023.
The Creditors' Committee Global Settlement reflects a proposed
compromise and settlement pursuant to Bankruptcy Rule 9019 and
section 1123 of the Bankruptcy Code of the Ongoing General
Unsecured Claims and Other General Unsecured Claims. The following
constitutes the integrated provisions and conditions of the
Creditors' Committee Global Settlement:
* Holders of Ongoing General Unsecured Claims and Other
General Unsecured Claims shall receive the treatment set forth in
Section 4.6(b) and 4.7(b), respectively.
* The Creditors' Committee shall (a) withdraw any objection to
any motion, application or filing of the Debtors or the PTL Group
where such motion, application or filing is not inconsistent with
Creditors' Committee Global Settlement, (b) not make or file any
objection contrary to or against the relief sought by the Debtors
or the PTL Group in relation to the Plan where such relief is not
inconsistent with the Creditors' Committee Global Settlement, (c)
support the Plan, and (d) withdraw all document production requests
and deposition notices and limit all participation in any
depositions to only observance.
* The Class 6B Trust shall have the authority to reconcile all
Other General Unsecured Claims other than the Excluded Class 6B
Claims, provided that, the Debtors, the Requisite Consenting
Creditors, and the Creditors' Committee shall, by the Effective
Date or as soon as reasonably practicable thereafter, agree on a
written protocol acceptable to each to address the reconciliation
of the Excluded Class 6B Claims. The Debtors and the Reorganized
Debtors, as applicable, shall retain exclusive authority to
reconcile and settle the Excluded Class 6B Claims in accordance
with the terms of this Plan, but, for the avoidance of doubt, all
distributions under this Plan on account of Allowed Excluded Class
6B Claims shall be made by the Class 6B Trust.
* In accordance with Section 8.7 of this Plan, the Debtors and
their Estates shall only be liable on, and the Class 6B Trust shall
only be responsible for distributions to, Allowed Insured
Litigation Claims up to the amount of any applicable SIR, and the
distributions provided for pursuant to Section 4.7 of the Plan on
account of such SIR shall satisfy any requirement for such amounts
to be paid under the applicable insurance policies and any amount
of the Allowed Insured Litigation Claims in excess of an such
self-insured retention or similar deductible shall be satisfied by
the insurer pursuant to the applicable insurance policy.
* Upon the Effective Date, the Debtors shall transfer, or
cause to be transferred, the Class 6B Trust Assets to the Class 6B
Trust.
* The Reorganized Debtors shall provide the Class 6B Trust
reasonable consultation and access to the Debtors' books and
records, including access to insurance policies related to the
Insured Litigation Claims, to enable reconciliation of the Other
General Unsecured Claims and the pursuit of Class 6B Causes of
Action, as set forth in the Class 6B Trust Agreement.
A full-text copy of the Modified First Amended PLan dated May 14,
2023 is available at https://bit.ly/3MHueGC from Epiq Corporate
Restructuring, LLC, claims and noticing agent.
Attorneys for the Debtors:
Gabriel A. Morgan, Esq.
Stephanie N. Morrison, Esq.
WEIL, GOTSHAL & MANGES LLP
700 Louisiana Street, Suite 1700
Houston, TX 77002
Telephone: (713) 546-5000
Facsimile: (713) 224-9511
E-mail: Gabriel.Morgan@weil.com
Stephanie.Morrison@weil.com
- and -
Ray C. Schrock, Esq.
Alexander W. Welch, Esq.
WEIL, GOTSHAL & MANGES LLP
767 Fifth Avenue
New York, NY 10153
Telephone: (212) 310-8000
Facsimile: (212) 310-8007
E-mail: Ray.Schrock@weil.com
Alexander.Welch@weil.com
About Serta Simmons Bedding
Serta Simmons Bedding, together with its non-debtor affiliates, are
manufacturers and marketers of bedding products in North America,
operating various bedding manufacturing facilities across the
United States and Canada.
Serta Simmons Bedding, LLC filed its voluntary petition for relief
under Chapter 11 of the Bankruptcy Code (Bankr. S.D. Tex. Lead Case
No. 23-90020) on Jan. 23, 2023. The petitions were signed by John
Linker, chief financial officer, treasurer and assistant secretary.
At the time of filing, the Debtors estimated $1 billion to $10
billion in both assets and liabilities.
Gabriel Adam Morgan, Esq. at the Weil, Gotshal & Manges represents
the Debtor as counsel. The Debtor also tapped Evercore Group, LLC
as its investment banker; FTI Consulting, Inc., as its Financial
Advisor; Epiq Corporate Restructuring, LLC as its claims and
noticing agent; and Pricewaterhousecoopers LLP as its tax services
advisor.
SINCLAIR TELEVISION: $750M Bank Debt Trades at 19% Discount
-----------------------------------------------------------
Participations in a syndicated loan under which Sinclair Television
Group Inc is a borrower were trading in the secondary market around
81.2 cents-on-the-dollar during the week ended Friday, May 19,
2023, according to Bloomberg's Evaluated Pricing service data.
The $750 million facility is a Term loan that is scheduled to
mature on April 21, 2029. About $744.3 million of the loan is
withdrawn and outstanding.
Sinclair Television Group, Inc. provides media broadcasting
services. The Company offers television broadcasting and
programming services.
SIO2 MEDICAL: Unsecured Creditors to Recover Up to 100% in Plan
---------------------------------------------------------------
SiO2 Medical Products, Inc., and its affiliates filed with the U.S.
Bankruptcy Court for the District of Delaware a Disclosure
Statement for the Joint Chapter 11 Plan of Reorganization dated May
14, 2023.
The Debtors, together with their controlled non-Debtor subsidiary
(collectively, the "Company"), are a material life sciences
company. The Debtors are headquartered and own a manufacturing
center in Auburn, Alabama, as well as conducting operations in
Basel, Switzerland.
On March 29, 2023, the Debtors commenced these Chapter 11 Cases
with a clear path to emergence and support from their first lien
lenders, Oaktree Capital Management, L.P. and certain of its
affiliates and funds (together, the "Initial Plan Sponsors" or
"Oaktree"). The restructuring support agreement, enjoys the support
of Oaktree as holders of 100% of the Debtors' first lien term loan
facility (the "First Lien Term Loan," and such holders, the
"Consenting First Lien Term Loan Lenders").
Pursuant to the Restructuring Support Agreement, Oaktree will serve
as the Initial Plan Sponsors and support the restructuring
transactions embodied in the Restructuring Support Agreement and
the Plan (the "Restructuring Transactions"). Effectuating such
Restructuring Transactions will enable the Debtors to substantially
reduce their funded-debt obligations and to emerge from the Chapter
11 Cases on an expedited basis with a right-sized balance sheet and
a streamlined business model poised for success in a dynamic
environment.
The Restructuring Transactions contemplate preserving the SiO2
business—including nearly 250 jobs— through these chapter 11
cases. The restructuring has three main components:
* First, Oaktree has agreed to fund approximately $60 million
(exclusive of fees) in new money under the superpriority debtor
in-possession financing facility (the "DIP Facility," and the
claims created by the DIP Facility, the "Allowed DIP Claims"), to
fund these chapter 11 cases.
* Second, Oaktree committed to serve as the Initial Plan
Sponsors and equitize its Allowed DIP Claims and Allowed First Lien
Term Loan Claims into 100% ownership of Reorganized SiO2 through
the Plan, subject to the Company meeting certain milestones and
other requirements set forth in the Restructuring Support
Agreement, and Oaktree's ability to move away from the Plan and
purchase the assets of the Debtors if a Toggle Trigger occurs.
* Third, Oaktree agreed to subject its recovery under the Plan
to potential overbids pursuant to the Bidding Procedures.
Oaktree has agreed that it will not bid in the sale process, and
has agreed that it will not receive a reimbursement of fees and
expenses, or a break-up fee, if another bidder or combination of
bidders overbids the Baseline Bid. The floor for bids is therefore
approximately $349.1 million, which is the anticipated amount of
Oaktree's Allowed DIP Claims and Allowed First Lien Term Loan
Claims. Nonetheless, Oaktree has indicated that it may consent to a
recovery different than what is currently contemplated under the
Plan.
Currently, the Debtors anticipate that a Confirmation or Sale
Hearing will occur on June 28, 2023. If there is a successful
bidder for the New Common Stock or certain assets of the Debtors,
that buyer will replace Oaktree as the Plan Sponsor, and the Plan
will be effected in the same form, and Holders of Claims in junior
Classes will receive any Additional Value obtained through the
sale. It is not known at this time, and will not be known until
after a potential Auction what, if any, Additional Value will be
available for distribution.
The primary objective of the Plan is to maximize the value of
recoveries to all Holders of Allowed Claims and Allowed Interests
and generally to distribute all property of the Estates that is or
becomes available for distribution according to the priorities
established by the Bankruptcy Code and applicable law. The Debtors
believe that this objective is best served by means of the
Marketing Process, which provides for baseline value in the form of
the Equitization Restructuring, and may result in Additional Value
through a successful bid from one or more third-party purchasers.
In the event of a Toggle Trigger event, the Debtors are unlikely to
confirm this Plan.
Class 5 consists of General Unsecured Claims. On the Effective
Date, each holder of a General Unsecured Claim shall receive its
Pro Rata share of Additional Value (if any), after all Claims in
Classes 1, 2, 3, and 4 have been paid in full or otherwise
satisfied; provided, however, that in no event shall any Holder of
a General Unsecured Claim receive, on account of such Claim, a
recovery greater than 100% of the Allowed amount of such Claim.
This Class will receive a distribution of 0%-100% of their allowed
claims.
On the Effective Date, all Interests in SiO2 shall be cancelled,
released, extinguished, and discharged and will be of no further
force or effect. Holders of Interests shall receive no recovery or
distribution on account of their Interests in SiO2.
The Plan and distributions thereunder will be funded by or consist
of the following sources of consideration: (i) Cash on hand, (ii)
the Exit Financing, as applicable, and (iii) any Additional Value,
as applicable, to fund distributions to certain Holders of Allowed
Claims and Interests, consistent with the terms of the Plan.
A full-text copy of the Disclosure Statement dated May 14, 2023 is
available at https://bit.ly/3MDZhDh from Donlin, Recano and Co.,
Inc., claims agent.
Proposed Co-Counsel for the Debtors:
Justin R. Alberto, Esq.
Seth Van Aalten, Esq.
Patrick J. Reilley, Esq.
Stacy L. Newman, Esq.
COLE SCHOTZ P.C.
500 Delaware Avenue, Suite 1410
Wilmington, Delaware 19801
Tel: (302) 652-3131
Fax: (302) 652-3117
Email: svanaalten@coleschotz.com
jalberto@coleschotz.com
preilley@coleschotz.com
snewman@coleschotz.com
Brian Schartz, P.C.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
601 Lexington Avenue
New York, New York 10022
Tel: (212) 446-4800
Fax: (212) 446-4900
Email: bschartz@kirkland.com
- and -
Joshua M. Altman, Esq.
Dan Latona, Esq.
KIRKLAND & ELLIS LLP
KIRKLAND & ELLIS INTERNATIONAL LLP
300 North LaSalle Street
Chicago, Illinois 60654
Tel: (312) 862-2000
Fax: (312) 862-2200
Email: josh.altman@kirkland.com
dan.latona@kirkland.com
About SiO2 Medical Products
SiO2 Medical Products, Inc. is a material life sciences company
that is at the precipice of mass-commercialization of its
breakthrough materials science technology that is poised to
revolutionize the pharmaceutical industry. Major pharmaceutical
players are testing the company's vials, syringes, tubes, and other
offerings, and the Company anticipates large-scale adoption in the
relative near term.
SiO2 Medical Products and its affiliates sought protection under
Chapter 11 of the U.S. Bankruptcy Code (Bankr. D. Del. Lead Case
No. 23-10366) on March 29, 2023. In the petition signed by its
chief executive officer, Yves Steffen, SiO2 Medical Products
disclosed $100 million to $500 million in assets and $500 million
to $1 billion in liabilities.
Judge John T. Dorsey oversees the cases.
The Debtors tapped Kirkland Ellis, LLP and Kirkland & Ellis
International, LLP as general bankruptcy counsels; Cole Schotz P.C.
as local bankruptcy counsel; Alvarez & Marshal North America, LLC
as financial and restructuring advisor; and Lazard as investment
banker. Donlin, Recano and Co., Inc. is the claims, noticing,
solicitation and administrative agent.
SKILLZ INC: Incurs $35.6 Million Net Loss in First Quarter
----------------------------------------------------------
Skillz, Inc. has filed with the Securities and Exchange Commission
its Quarterly Report on Form 10-Q disclosing a net loss of $35.59
million on $44.38 million of revenue for the three months ended
March 31, 2023, compared to a net loss of $149.56 million on $91.86
million of revenue for the three months ended March 31, 2022.
As of March 31, 2023, the Company had $612.16 million in total
assets, $357.77 million in total liabilities, and $254.38 million
in total stockholders' equity.
Skills said, "Our existing liquidity resources are sufficient to
continue operating activities for at least one year past the
issuance date of the condensed consolidated financial statements.
Our future cash requirements will depend on many factors, including
our rate of revenue growth and the expansion of our sales and
marketing activities. We also may invest in or acquire
complementary businesses, applications or technologies."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1801661/000180166123000009/sklz-20230331.htm
About Skillz Inc.
Headquartered in San Francisco, California, Skillz --
www.skillz.com -- is a mobile games platform dedicated to bringing
out the best in everyone through competition. The Skillz platform
helps developers create multi-million dollar franchises by enabling
social competition in their games. Leveraging its patented
technology, Skillz hosts billions of casual eSports tournaments for
millions of mobile players worldwide, with the goal of building the
home of competition for all.
Skillz reported a net loss of $438.87 million in 2022, a net loss
of $187.92 million in 2021, and a net loss of $149.08 million in
2020.
* * *
As reported by the TCR on April 28, 2023, Moody's Investors Service
downgraded Skillz Inc.'s corporate family rating to Caa2 from Caa1
following the company's recent repurchase of more than 50% of its
outstanding debt at sizable discount to par, reducing available
liquidity to fund projected cash flow deficits.
Also in April 2022, S&P Global Ratings raised its issuer credit
rating to 'CCC+' from 'SD' (selective default). According to S&P,
the negative outlook reflects uncertainty around the Company's
ability to turn its substantially negative cash flow positive over
the next three years given ongoing challenges in right-sizing its
operations and its unproven business model.
SNC-LAVALIN: DBRS Confirms BB(high) Issuer and Sr. Debt Rating
--------------------------------------------------------------
DBRS Limited confirmed the Issuer Rating and Senior Debentures
rating of SNC-Lavalin Group Inc. (SNC or the Company) at BB (high).
DBRS Morningstar also confirmed the Recovery Rating of the Senior
Debentures at RR4. All trends remain Stable, reflecting improvement
in SNC's business risk profile through significant progress made in
the reduction of its lump-sum turnkey (LSTK) project backlog.
Despite continual losses associated with these activities in 2022,
SNC's rating continues to be supported by its robust engineering
services business, which DBRS Morningstar deems to be of
investment-grade quality due to its capacity for handling
large-scale and complex service activities across a variety of
subsectors, its geographic diversification, and long-term
relationships with high- quality clientele, largely from the public
sector.
The Company delivered moderate revenue growth of about 3% within
its Professional Services & Project Management business in F2022.
Revenue growth was driven by SNC's Engineering Services and
Operations & Maintenance businesses. EBITDA (DBRS Morningstar
calculated) reduced to $425 million in F2022 from $502 million in
F2021, as affected by lower earnings contributions from Engineering
Services and SNC's Capital business as well as a loss from Linxon,
which specializes in engineering, procurement, and construction of
power substations. Overall, credit metrics weakened in 2022 as a
result of weakened EBITDA, cash flow, and an increase in total
recourse debt as the Company worked towards bringing both the
Ottawa (Trillium) and Toronto (Eglinton) LSTK projects towards
physical completion, which was achieved in 2022. Despite metrics
weakening in 2022 beyond what was previously forecast, the losses
realized on the Company's LSTK projects are within SNC's publicly
stated $300 million risk envelope. DBRS Morningstar expects SNC's
financial risk metrics, which are currently weak for the rating, to
be within the current ratings category by fiscal 2023 and
ultimately reach investment grade by 2024.
Despite a challenging macroeconomic environment, DBRS Morningstar
expects that SNC's core business will remain resilient to any
global activity slowdown due to its expertise in sustainable
infrastructure and energy solutions as well as its large exposure
to the public sector, where spending is forecast to remain strong.
DBRS Morningstar anticipates that SNC will materially complete its
LSTK projects by 2024, upon which the Company's overall risk
profile will be markedly different. At that time, the more robust
engineering services business will underpin SNC's credit risk
profile without the overhang of financial volatility from LSTK
construction risk. This would be a favorable development from a
credit perspective. Once the Company demonstrates the ability to
achieve, as well as the commitment to maintain investment-grade
financial metrics, a positive rating action will be considered.
While not currently anticipated, prolonged financial volatility,
especially with respect to further material downside risk related
to LSTK construction, could result in a negative rating action.
Notes: All figures are in Canadian dollars unless otherwise noted.
SOUND INPATIENT: $610M Bank Debt Trades at 35% Discount
-------------------------------------------------------
Participations in a syndicated loan under which Sound Inpatient
Physicians Holdings LLC is a borrower were trading in the secondary
market around 65.1 cents-on-the-dollar during the week ended
Friday, May 19, 2023, according to Bloomberg's Evaluated Pricing
service data.
The $610 million facility is a Term loan that is scheduled to
mature on June 28, 2025. About $593.8 million of the loan is
withdrawn and outstanding.
Sound Inpatient Physicians Holdings, LLC, through its
subsidiaries,
provides healthcare services.
SPECTRUM BRANDS: Fitch Alters Outlook on 'BB' IDR to Negative
-------------------------------------------------------------
Fitch Ratings has affirmed Spectrum's ratings, including the
Long-Term Issuer Default Rating (IDR) at 'BB' of both Spectrum
Brands, Inc. and SB/RH Holdings, LLC, its secured credit facilities
at 'BBB-'/'RR1', and its unsecured notes at 'BB'/'RR4'. Fitch has
revised the Rating Outlook to Negative from Stable.
Spectrum's ratings reflect Fitch's expectation that EBITDA leverage
could be elevated in FY 2023 to around 6.0x before declining toward
4x in FY 2024 as a result of debt repayment funded from the sale of
its HHI business.
The Negative Outlook reflects uncertainty around the company's
medium-term strategy and business composition, as well as its
ability to reverse recent weak operating trends, which increases
the risk that EBITDA leverage could remain elevated above 4.0x
beyond FY 2024.
Increased clarity and confidence around Spectrum's ability to
execute on a strategy that supports top line and EBITDA growth,
along with EBITDA leverage sustained below 4x could lead to a
stabilization in the Outlook.
KEY RATING DRIVERS
Declining Sales and EBITDA: Spectrum's sales could decline in the
mid-to-high-single-digit range in FY 2023 (ending September 2023),
to around $2.95 billion from around $3.15 billion in FY 2022. The
company has faced several operating pressures in FY 2023, including
soft demand for certain products in its Home and Personal Care
(HPC) category, inventory destocking and changes in ordering from
retailers and challenging weather conditions all of which have put
pressure on sales.
Fitch expects that improved inventory levels in retail channels,
combined with more normalized weather conditions, could support
sales growth in the Global Pet Care (GPC) and Home and Garden (H&G)
segments in the low-single-digit range in 2024 and thereafter;
however, sales in the HPC segment could remain weak in FY2024 as
consumers continue to prioritize spending on services over
discretionary goods.
Fitch believes that macro pressures and mis-execution could lead to
Spectrum's EBITDA declining to the mid-$200 million range in FY
2023, from around $280 million in FY 2022. Fitch assumes improving
inventory costs, cost reductions measures in 2022 and 2023, and
modest sales growth could enable EBITDA to grow toward the
high-$200 million range over the next two to three years; however,
there is some uncertainty in the company's ability to take steps to
reverse trends and grow EBITDA in line with Fitch's base case.
Uncertain Business Makeup: Over past several years, the company has
made a large number of asset sales and acquisitions that have
changed the complexion of the company. While the company has
indicated its go-forward strategy is to focus on becoming a more
focused pet, home and garden company, Fitch believes that divesting
its HPC segment will be challenging in the medium term given the
pressures in that business. Given the company's opportunistic
approach to building its portfolio historically, Fitch believes the
company could be opportunistic in its approach to M&A post HHI
close, increasing the uncertainty on the future composition of its
business.
HHI Proceeds Fund Debt Reduction: Fitch projects Spectrum's gross
EBITDA leverage could be around 6.0x in FY2023 before declining to
the low 4.0x range in FY 2024 and thereafter driven primarily by
debt repayment. Fitch's base case assumes that the company will
repay around $2 billion in total debt between FY 2023 and FY 2024;
however, there is some risk that the company could use HHI proceeds
to fund M&A or other initiatives instead of prioritizing debt
reduction. If the company is unable to reverse recent weak
operating trends, it could lead to leverage remaining elevated for
longer than expected.
Over the longer term, the company is targeting net leverage between
2.0x-2.5x. Net leverage could be meaningfully lower than this over
the short term as Spectrum holds a portion of HHI proceeds on its
balance sheet. The company expects to generate around $3.5 billion
in net proceeds from the sale of HHI, and has stated it expects the
transaction to close on or before June 30, 2023 after a settlement
was reached with the U.S. DOJ.
Reasonably Diverse Portfolio: After the HHI sale closes, Spectrum
will have three distinct verticals with significant breadth within
each. Fitch believes that the company is still targeting divesting
its HPC segment at some point in order to become a home and garden
and pet supply business; however, even after divesting, HPC
Spectrum's business profile would still be reasonably diverse with
a portfolio similar to that of Central Garden and Pet Company
(BB/Stable) with adequate diversification across both the Pet Care
(around 66% of 2022 revenue excluding HPC) and Home & Garden
verticals (around 33%).
Within pet care, the portfolio consists of products for dogs, cats,
birds, fish and small animals including food, treats, habitats,
health products and grooming supplies. Within Home & Garden, the
portfolio includes cleaning supplies, pest and weed control
solutions, and insect repellents.
While a potential HPC divestiture reduces the company's business
scope and scale, the portfolio provides reasonable operating
diversity if any given product category or brand sustains some
weakness. From a geographic standpoint, around three-quarters of
the company's revenue, is generated from North America, but
Spectrum has some diversity with exposure to EMEA and Latin
America. The sale of the HHI segment also leads to a material
decline in scale, with Fitch forecasting sales will decline to
around $3 billion in FY 2023 compared with around $3.9 billion in
FY 2020.
DERIVATION SUMMARY
Spectrum's 'BB' rating reflects the company's diversified portfolio
and Fitch's belief that debt repayment from the HHI transaction
could enable the company to reduce leverage toward 4.0x by FY 2024.
Spectrum is similarly rated to ACCO Brands Corporation (BB/Stable),
Central Garden & Pet Company (CENT; BB/Stable), Newell Brands
(BB/Negative) and Tempur Sealy International, Inc. (BB+/RWN).
Spectrum has greater product diversity given its exposure to more
product segments compared with ACCO or CENT; however, Fitch
forecasts that ACCO and CENT could generate greater EBITDA and post
lower leverage than Spectrum in 2023. Tempur Sealy has less product
diversity than Spectrum, but it has lower leverage than Spectrum
and its scale is around 3x larger based on Fitch's calculation of
2022 EBITDA. Newell is materially larger than Spectrum, with EBITDA
around 4x greater than Spectrum in 2023; however, Newell could
generate higher leverage than Spectrum over time.
KEY ASSUMPTIONS
Fitch's Key Assumptions Within the Rating Case for the Issuer
- Fitch's base case is proforma for the sale of HHI and assumes the
HPC business, including Tristar, remains with Spectrum;
- Revenue is forecast to decline in FY 2023 in the
mid-to-high-single digit range driven by soft demand in certain
categories, inventory destocking and changes in ordering from
retailers and challenging weather conditions. Sales could remain
roughly flat in FY 2024 and grow in the low-single-digit range in
FY 2025 and thereafter as retailers work through their excess
inventories and return to more normalized ordering patterns and on
modest improvement in consumer demand;
- EBITDA in FY 2023 could decline to around $250 million (margins
of around 8%) from $283 million in FY 2022, driven by factors such
as declining sales, moves to reduce excess inventory, and the
inability to fully pass on high input costs. EBITDA could remain
roughly flat in 2024, with EBITDA margins expanding to the 9% range
in 2025 and thereafter;
- FCF in FY 2023 could be in the mid $100 million range, driven by
strong working capital unwind as the company reduces its inventory
levels compared with 2022. FCF could be in the $50 million to $100
million range in 2024 and thereafter, partially supported by lower
interest costs after the company deploys a significant amount of
HHI sale proceeds to debt repayment;
- EBITDA leverage is expected to be around 6.0x in FY 2023 and
decline to the low 4.0x range in FY 2024 given Fitch's expectation
that the company uses a portion of HHI sale proceeds to repay debt.
Fitch's forecasts assume that the company will repay around $2
billion of debt between FY 2023 and FY 2024, including all
outstanding term loan and credit facility amounts;
- The base case does not assume any meaningful M&A transactions
across the rating horizon; however, if Spectrum were to engage in
M&A activity it could lead to lower levels of debt repayment than
Fitch currently expects.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- The Outlook could be stabilized if the company sustained EBITDA
leverage declines to below 4.0x by FY 2024 and Fitch were to gain
clarity and confidence in Spectrum's forward operating strategy;
- Assuming the HHI sale closes, Fitch would consider an upgrade if
Spectrum demonstrated commitment to clear and consistent operating
and financial strategies, leading to sustained top line and profit
growth, with EBITDA leverage sustained below 3.0x.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- A downgrade could result from a lack of clarity on the company's
forward operating strategy, leading to further questions about the
company's operating model, or an extended period of operating
weakness yielding EBITDA leverage sustained above 4.0x.
LIQUIDITY AND DEBT STRUCTURE
Good Liquidity post HHI Transaction Proceeds: Liquidity was
adequate at $689.9 million as of April 3, 2023, consisting of
$327.8 million of cash and equivalents and $362.1 million of
availability on its $1.1 billion revolving credit facility due June
2025 net of $725 million in outstanding borrowings and $12.9
million in LOCs.
In February, 2022, Spectrum increased its revolver to $1.1 billion
from $600 million. Fitch expects the company will repay the
revolver borrowings with the proceeds of the HHI sale, and the
company could also consider downsizing the revolver should the HHI
transaction close. Spectrum expects to generate approximately $3.5
billion in net sale proceeds from the HHI business after taxes on a
$4.3 billion gross sale price, and it has stated it expects the
transaction to close on or before June 30, 2023, after reaching a
settlement with the U.S. DOJ (approval from the Mexican regulator
is still outstanding).
As of April 3, 2023, Spectrum's capital structure also included a
$394 million secured term loan due March 2028, approximately $1.55
billion of senior unsecured notes maturing between 2025 and 2031,
and EUR425 million of unsecured euro notes maturing in October
2026. Total debt across these instruments was approximately $3.10
billion. Fitch expects Spectrum to pay down term loan borrowings
post the close of HHI, along with a portion of unsecured notes over
the next 12 months.
Recovery Considerations
Fitch has assigned Recovery Ratings (RRs) to the various debt
tranches in accordance with Fitch criteria, which allows for the
assignment of RRs for issuers with IDRs in the 'BB' category. Given
the distance to default, RRs in the 'BB' category are not computed
by bespoke analysis. Instead, they serve as a label to reflect an
estimate of the risk of these instruments relative to other
instruments in the entity's capital structure. Fitch assigned the
first-lien secured debt a 'BBB-'/'RR1', notched up two from the IDR
and indicating outstanding recovery prospects given default.
Unsecured debt will typically achieve average recovery, and was
thus assigned a 'BB'/'RR4' rating.
ISSUER PROFILE
Spectrum Brands is a diversified consumer products company that
currently competes in a number of segments, including pet care
(GPC), home and garden H&G) and home and personal care (HPC). The
company is in the process of selling its hardware and home
improvement (HHI) segment.
SUMMARY OF FINANCIAL ADJUSTMENTS
Material financial adjustments include stock-based compensation,
safety recalls, divestitures, legal and environmental remediation
reserves, inventory step-up and other non-operating expenses.
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
----------- ------ -------- -----
Spectrum
Brands, Inc. LT IDR BB Affirmed BB
senior secured LT BBB- Affirmed RR1 BBB-
senior
unsecured LT BB Affirmed RR4 BB
SB/RH Holdings,
LLC LT IDR BB Affirmed BB
TALCOTT FINANCIAL: S&P Assigns 'BB+' Long-Term ICR, Outlook Stable
------------------------------------------------------------------
S&P Global Ratings assigned a 'BB+' long-term issuer credit rating
to Talcott Financial Group (TFG). The outlook is stable.
The rating on TFG is at the same level as that on Talcott
Resolution Life Inc., the intermediate holding company within the
group. The alignment reflects our view of no structural
subordination and smooth capital fungibility between the two
companies. S&P's issuer credit rating on both these companies is
three notches below the rating on core operating subsidiaries
Talcott Resolution Life Insurance Co. and Talcott Resolution Life &
Annuity Insurance Co., which is standard for U.S.-based holding
companies because they depend primarily on dividends from the
operating subsidiaries to meet their ongoing financial
obligations.
TFG currently has no senior debt outstanding and a negligible
amount of cash and liquid assets at the holding company level, so
it relies on dividends from its subsidiaries to pay its relatively
small amount of annual operating expenses. S&P expects the annual
remittances from those subsidiaries, via Talcott Resolution Life
Inc., to TFG to be more than enough to cover those expenses for the
next several years.
S&P Said, "Our ratings on Talcott reflect the company's growth and
diversification strategy, as well as its transformation to an
aggregator of blocks of annuity and life liabilities from a run-off
entity since its acquisition by Sixth Street. The ratings also
incorporate our expectation that the company will maintain its
capital adequacy at the 'A' confidence level per our capital model
while maintaining a conservative investment strategy and prudent
dividend philosophy toward its parent, Sixth Street."
Sixth Street, a leading global investment firm, acquired Talcott
Resolution Life Inc. in 2021. The company has also established an
offshore business unit to optimize capital resources and be more
competitive in the block merger and acquisition market. S&P
continues to monitor the integration of the blocks of business the
company has acquired (via reinsurance) and prospective growth and
operating performance. Recent acquisitions are subject to
policyholder behavior assumptions and other market-related risks
that are still developing.
S&P said, "The stable outlook on TFG reflects the stable outlook on
its core operating subsidiaries. This outlook reflects our view
that Talcott's growth strategy and philosophy show continuity while
the company manages profitability and demonstrates robust risk
management. We also expect the company will maintain at least 'A'
capital adequacy.
"We could lower the ratings over the next 12-24 months if
capitalization falls below 'A' and we believe it will remain there.
We could also lower the ratings if Talcott, on a stand-alone basis
or combined with affiliated companies, increases its risk position
or financial risk to a level that we think is inconsistent with its
strategy, philosophy, or ability to manage or if, in our view, its
enterprise risk management program weakens.
"We could raise the ratings over the next 12-24 months if the
company develops its competitive position--via acquisitions or
block reinsurance transactions--such that it enhances and
diversifies earnings meaningfully and if the company maintains
favorable operating performance with a track record of capital
adequacy under current ownership."
TENNISWOOD INC: Case Summary & 20 Largest Unsecured Creditors
-------------------------------------------------------------
Debtor: Tenniswood, Inc.
d/b/a Vick's Cleaners
2965 W. Navy Blvd
Pensacola, FL 32505
Business Description: The Debtor is a full dry cleaner & laundry
services provider.
Chapter 11 Petition Date: May 19, 2023
Court: United States Bankruptcy Court
Northern District of Florida
Case No.: 23-30350
Debtor's Counsel: J. Steven Ford, Esq.
WILSON, HARRELL, FARRINGTON, FORD, ET AL.
307 S. Palafox Street
Pensacola, FL 32502
Tel: 850-438-1111
Fax: 850-432-8500
Email: sford@wilsonharrell.com
Total Assets: $214,164
Total Liabilities: $2,173,933
The petition was signed by Mark Tenniswood as president.
A full-text copy of the petition containing, among other items, a
list of the Debtor's 20 largest unsecured creditors is available
for free at PacerMonitor.com at:
https://www.pacermonitor.com/view/N7NILWY/Tenniswood_Inc__flnbke-23-30350__0001.0.pdf?mcid=tGE4TAMA
TOSCA SERVICES: $626.5M Bank Debt Trades at 29% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Tosca Services LLC
is a borrower were trading in the secondary market around 70.6
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $626.5 million facility is a Term loan that is scheduled to
mature on August 18, 2027. About $614.5 million of the loan is
withdrawn and outstanding.
Tosca Services, LLC manufactures and supplies container solutions.
The Company offers plastic containers to transport fruit and
vegetable, egg, poultry, meat, and cheese products. Tosca Services
serves growers, suppliers, food manufacturers, and retailers in
North America.
TRIBE BUYER: $397M Bank Debt Trades at 38% Discount
---------------------------------------------------
Participations in a syndicated loan under which Tribe Buyer LLC is
a borrower were trading in the secondary market around 62.2
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $397 million facility is a Term loan that is scheduled to
mature on February 16, 2024. The amount is fully drawn and
outstanding.
Tribe Buyer LLC provides construction services. The Company
operates in the United States.
US RENAL CARE: $225M Bank Debt Trades at 43% Discount
-----------------------------------------------------
Participations in a syndicated loan under which US Renal Care Inc
is a borrower were trading in the secondary market around 57.3
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $225 million facility is a Term loan that is scheduled to
mature on July 26, 2026. About $221.1 million of the loan is
withdrawn and outstanding.
U.S. Renal Care is a dialysis provider available for people living
with chronic and acute renal disease.
US RENAL: $1.60B Bank Debt Trades at 43% Discount
-------------------------------------------------
Participations in a syndicated loan under which US Renal Care Inc
is a borrower were trading in the secondary market around 56.7
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $1.60 billion facility is a Term loan that is scheduled to
mature on July 26, 2026. About $1.54 billion of the loan is
withdrawn and outstanding.
U.S. Renal Care is a dialysis provider available for people living
with chronic and acute renal disease.
US TELEPACIFIC: S&P Downgrades ICR to 'CCC-', Outlook Negative
--------------------------------------------------------------
S&P Global Ratings lowered its issuer credit rating on U.S.
TelePacific Holdings Corp. (doing business as TPx Communications)
to 'CCC-' from 'CCC+'.
S&P said, "At the same time, we lowered our issue-level rating on
its $655 million senior secured term loan and $25 million revolving
credit facility to 'CCC-' from 'CCC+'. Our '4' recovery rating
remains unchanged, indicating our expectation for average (30%-50%;
rounded estimate: 40%) recovery in the event of a payment default.
"The negative outlook reflects TPx's limited covenant cushion amid
its continued weak operating performance, as well as the potential
for a covenant breach absent a restructuring transaction over the
next couple of quarters.
"TPx has limited headroom under its maximum leverage covenant and
we believe a covenant breach is likely over the next couple of
quarters. The company has a maximum leverage covenant of 15.6x,
which we believe it was in compliance with as of year-end 2022,
albeit with limited headroom. However, the covenant steps down to
12.9x in the first quarter of 2023 and 11.7x in the second quarter
of 2023. Given our expectation for a continued weak operating
performance, we believe it will be difficult for TPx to remain in
compliance with the covenant absent an equity infusion from its
private-equity sponsor Siris Capital. However, even with additional
support from the sponsor, the company can only cure a breach with
equity infusions twice per calendar year, which renders it
susceptible to a covenant breach in the second half of the year
unless its business conditions improve materially.
"TPx's lower earnings, negative free operating cash flow (FOCF),
and the payment-in-kind (PIK) feature on its term loan will make it
difficult for it to improve its leverage. The company faces
elevated interest expense due to rising rates and continues to
generate negative FOCF because of its lower EBITDA. We also expect
it will choose to make in-kind distributions in 2023, which further
contributes to our view that its capital structure is
unsustainable.
"We expect TPx's EBITDA to remain low over the next couple of years
as it transitions its business away from its legacy products and
services. The company is taking out about $93 million of costs from
its business, about two-thirds of which will come from the shutdown
of its co-locations in incumbent facilities as it disconnects its
legacy circuits and migrates its customers to cloud-based
solutions. However, the costs to achieve these future expense
reductions are significant, thus we include them as one-time
expenses in our EBITDA calculation.
"Our base-case forecast assumes the company recorded a FOCF deficit
of about $70 million-$80 million in 2022, which improves to
negative $25 million-$35 million this year. That said, even if its
operating and financial performance recovers in 2024, we expect
TPx's FOCF deficits will accelerate as its credit facility turns
cash pay, given its high interest cost of SOFR+650 basis points.
"The negative outlook reflects TPx's limited covenant cushion amid
its continued weak operating performance and the potential for a
covenant breach absent a restructuring transaction over the next
couple of quarters."
S&P could lower its ratings on TPx if:
-- It breaches the maximum leverage covenant and is unable to cure
the breach in 30 days, as per the credit agreement; or
-- The company announces a debt restructuring transaction that we
would view as a distressed exchange.
S&P Said, "We could raise our ratings on TPx if its liquidity
position and covenant cushion improve, supported by a
stronger-than-expected operating performance or the successful
amendment of its maximum leverage covenant, such that we no longer
believe a covenant breach is likely in the near term."
ESG credit indicators: E-2, S-2, G-3
S&P said, "Governance is a moderately negative consideration in our
credit rating analysis of TPx. Our highly leveraged assessment of
the company's financial risk profile reflects corporate
decision-making that prioritizes the interests of its controlling
owners, in line with our view of most rated entities owned by
private-equity sponsors. Our assessment also reflects
private-equity owners' generally finite holding periods and focus
on maximizing shareholder returns."
VENTURA GLOBAL: Fitch Assigns FirstTime 'B' IDR, Outlook Stable
---------------------------------------------------------------
Fitch Ratings has assigned a first-time Long-Term Issuer Default
Rating (IDR) of 'B' to Venture Global LNG, Inc. (VGLNG).
Additionally, Fitch has assigned a senior secured rating of
'BB-'/'RR2' to VGLNG's proposed senior secured notes. Proceeds are
expected to prepay the outstanding corporate term loan. The Rating
Outlook is Stable.
VGLNG ratings reflect the volatility of its primary revenue source
due to commodity price exposure associated with early commissioning
revenues. The revenues are generated from liquified natural gas
(LNG) commissioning cargos sold in the global LNG market at spot
prices. Also reflected is the project completion risks at VGLNG's
two LNG projects currently under construction. Once the LNG
projects are complete, VGLNG benefits from incremental cashflow
provided by distributions from the projects.
Fitch expects the LNG projects to generate predictable cash flows
under long-term sale and purchase agreements (SPAs) with
predominately investment-grade counterparties under take- or-pay
contracts. Fitch expects VGLNG to manage the large scale,
multi-year construction projects in a credit supportive manner.
KEY RATING DRIVERS
High Commodity Exposure: Fitch believes VGLNG's approach to fund
future LNG plants with the early cargo sales exposes the company to
significant commodity risk. The mid-scale modular trains produce
substantially more LNG cargos during commissioning than a typical
stick-built large-scale LNG Train. VGLNG sells these cargos into
the short-term market on a rolling basis, as units are commissioned
and before the long-term SPAs commence.
Increasing Global LNG Supply: VGLNG benefited during the
commissioning of its first project, Venture Global Calcasieu Pass,
LLC (VGCP), when the market basis differential between Henry Hub
(HH) gas and Title Transfer Facility (TTF), the European LNG hub,
reached historic highs in 2022. However, global LNG pricing has
returned closer to historic norms, and will vary based on global
supply and demand, potentially impacting the FCF available for
VGLNG to finance its future LNG construction and meet debt
obligations.
Fitch believes demand for LNG will remain strong in the near term,
given the European drive to move away from Russian natural gas,
acceleration of the energy transition and limited new LNG
production capacity coming online until the mid-2020s. However, LNG
spot market pricing is expected to tighten as new LNG plants come
online in 2025 and 2026 globally. Fitch's price deck supports this
view. Past cycles as recent as 2019 illustrate the drop-in spot
market prices as new production capacity outpaced global demand.
Ongoing Construction and Commissioning Risk: VGLNG's construction
risk will be ongoing over the near term. The first project, a 10
mtpa mid-scale LNG facility, VGCP, is nearing a 2024 commercial
operation date (COD). Construction at Venture Global Plaquemines
(VGPL), a 20 mtpa mid-scale LNG facility, is almost 40% complete as
of March, 2023. Fitch believes LNG plants are among the most
complex facilities in its rated midstream portfolio to construct
and operate.
The VGPL project is a very large scale $18.4 billion project being
constructed by a joint venture of KBR and Zachry Group. VGPL is
using a proven mid-scale liquefaction technology employed at VGCP
but has potential scale-up and interface risks through its
multi-contractor structure. The project's off-site modular
fabrication avoids risk seen in large-scale on-site manufacturing.
However, it differs from other LNG projects that rely on a single
contractor to bear most, if not all, budget and completion risk.
Some of these risks are mitigated by the construction progression,
experienced specialized contractors, performance security and an
above average contingency and incentives for early completion.
Structural Subordination During Operations: VGLNG's debt
obligations benefit from the early cargo revenues generated during
the commissioning period from its projects. After commissioning,
VGLNG debt obligations will rely on distributions paid after
servicing $6.0 billion of non-recourse debt at VGCP and $12.9
billion at VGPL.
Project indentures contain a covenant preventing distributions if
forward-looking debt service coverage ratios (DSCR) are less than
1.25x. This provision is likely triggered as the projects face
refinancing risk at COD and an uncertain opex profile during
ramp-up. VGCP has a lower refinancing risk having refinanced most
of its term loan and addressed ramp- up issues during
commissioning. Refinancing project debt requires full amortization
of principal within the SPA terms and reduces cash available for
distribution to VGLNG. Fitch believes management will use credit
supportive measures to ensure headroom under the distribution tests
in addressing these issues.
Robust Sales and Purchase Agreements: FCF from VGCP and VGPL is
backed by long-term SPAs with largely investment-grade
counterparties, comprised of 19 customers across the two projects.
Each will operate under the contracts once COD is reached. Fitch
believes the contract structure available during the operating
period provides stable cash flow while insulating cash flow from
trends in the global LNG market but is a small portion of the CF
available to VGLNG's bondholders.
Credit Metrics: Fitch applies a deconsolidated and proportionally
consolidated approach in calculating VGLNG's credit metrics. The
subsidiaries have non-recourse debt, which is considered in the
proportionally consolidated credit metrics. Stonepeak
Infrastructure owns two series of preferred instruments, one which,
based on current projections, is expected to convert into
approximately 25% ownership of VGCP at COD. Fitch considers these
preferred instruments as debt under its criteria.
Holdco-only FFO Leverage (total holdco debt divided by cash
available for debt service after maintenance capex) averages less
than 2.5x over the forecast period through 2027, with growth capex
funded from excess CF, among other sources. On a proportionally
consolidated basis, leverage (total consolidated debt to
proportional EBITDA) averages 6.0x over 2023-2027, but peaks at
12.0x in the near-term during a period of high capex and declining
market global spot prices. This peak leverage highlights the
commodity risk.
DERIVATION SUMMARY
VGLNG is a midstream corporation with two projects under
construction. Advanced capital equipment purchases are underway for
a third project. The first project, a 10 mtpa facility in Calcasieu
Pass, LA, has been operational under commissioning since 2022. The
majority of the cashflow is from sales of early commissioning LNG
cargos in the global spot market. Additionally, its operations are
supported by long-term take-or-pay contracts with a diverse mix of
predominately investment grade customers, similar to peer Cheniere
Energy Inc (CEI; BBB-/Stable). CEI is a midstream corporation with
the largest LNG production and export facilities (60 mtpa) in the
U.S. and second largest globally.
VGLNG's obligations are backed by long-term SPAs with largely
investment-grade counterparties, comprised of 19 customers across
the two projects, VGCP and VGPL. Each SPA provides revenue from a
fixed-capacity fee paid regardless of LNG volumes lifted and a
commodity-based variable fee on LNG volumes delivered, equal to
115% of current HH prices. The contracts are almost all 20 years.
VGCP has two short term contracts of less than five years (15% of
capacity). VGLNG's obligations are structurally subordinate to
about $20 billion of operating subsidiaries' project obligations,
which were used to fund the construction of the LNG facilities and
related lateral pipelines.
CEI has a similar structure, with its obligations subordinate to
about $19 billion of project debt and $4 billion of intermediate
holding company debt. Both are subject to distribution tests that
could impede distributions to the parent companies. While both
VGLNG and CEI receive revenues from short term market sales, the
early cargo revenues are a larger portion of total CF for VGLNG
compared to CEI.
CEI has greater scale, operating two seasoned projects, Sabine Pass
Liquefaction (BBB/Stable) and Corpus Christi Liquefaction
(BBB-/Stable), with expected DSCRs well in excess of its
distribution coverage test, mitigating the concern over
distribution lock-ups ultimately to the parent. While VGLNG has
revenues from early cargos, those revenues, in Fitch's opinion, are
not as predictable, and subject to commodity price risk.
VGLNG's leverage is considerably higher than CEI, on a
proportionally consolidated basis, averaging 6.0x during the
forecast. CEI's Fitch forecasted leverage is between 4x-4.5x after
2024. The difference in cashflow predictability, scale and leverage
account for the difference in the ratings.
KEY ASSUMPTIONS
- VGCP, nearly complete, reaches COD in Q1 2024 and the SPA
contracts begin. Nameplate capacity of 10 mtpa is fully contracted
and generates additional liquefaction fees on 1.0 mtpa excess
capacity above nameplate, which is contracted to an affiliate;
- Construction at VGPL continues on schedule consistent with
management expectations of about $19 billion cost, reaching first
commissioning in 2024. The term loan is refinanced in 2027 at a
rate of 8%, when COD occurs. Nameplate capacity of 20 mtpa is fully
contracted and generates additional liquefaction fees on 2.5 mtpa
excess capacity above nameplate, which is contracted to an
affiliate;
- Construction of CP2 is in line with management expectations, at a
cost of about $26 billion, and reaches COD at the end of 2027. The
first phase of the third project, CP2, is currently close to 48%
contracted and assumed to be fully contracted during the operating
period;
- The Delta project is not funded during the forecast period;
- The Fitch price deck for oil and natural gas informs the
assumptions for natural gas, crude, LNG and the unhedged volumes.
The Fitch operating margin under the rating case for the early
commissioning cargos is as follows: $10.00/MMBtu in 2023,
$8.00/MMBtu in 2024, $7.00/MMBtu in 2025, $5.00/MMBtu in 2026, and
$4.00/MMBtu in 2027.
- For the Recovery Rating, Fitch estimates the company's
going-concern value was greater than the liquidation value, despite
the high equity value retained by VGLNG in VGCP and VGPL. The
going-concern EBITDA estimate of $1,530 million reflects Fitch's
view of a sustainable, post-reorganization EBITDA level upon which
Fitch bases the valuation of the company. Fitch calculated
administrative claims to be 10%, which is the standard assumption.
Fitch assumes the default occurs in 2024 during a period of
depressed LNG spot market pricing and VGCP begins to operate under
the long-term SPAs as it reorganizes. As per criteria, the going
concern EBITDA reflects some residual portion of the distress that
caused the default;
- The going-concern multiple used was a 4.0x EBITDA multiple, which
reflects the default occurring during construction and the
reorganization would be impacted by the complexity and large scale
of the construction project;
- There have been a limited number of bankruptcies within the
midstream sector. Two recent gathering and processing bankruptcies
of companies indicate an EBITDA multiple between 5.0x and 7.0x, by
Fitch's best estimates. In its recent Bankruptcy Case Study Report,
"Energy, Power and Commodities Bankruptcies Enterprise Value and
Creditor Recoveries", published in September 2021, the median
enterprise valuation exit multiple for the 51 energy cases with
sufficient data to estimate was 5.3x, with a wide range of
multiples observed.
RATING SENSITIVITIES
Factors that could, individually or collectively, lead to positive
rating action/upgrade:
- Reach COD for VGCP and commissioning of VGPL;
- Reduction in the reliance on the commodity price exposed
cashflows;
- Reduction in the refinancing exposure at VGPL resulting in
improved distributions to VGLNG.
Factors that could, individually or collectively, lead to negative
rating action/downgrade:
- Significant weakness in global LNG prices, pressuring the
company's cash flow generation from early cargoes;
- Any construction issues that significantly increases costs or
results in deteriorating cash flows;
- Holdco-only FFO leverage above 4.0x on a sustained basis or
proportionally consolidated leverage above 7.0x on a sustained
basis;
- A multi-notch downgrade or financial distress of any SPA
counterparty.
LIQUIDITY AND DEBT STRUCTURE
Sound Liquidity: VGLNG and its subsidiaries have sound liquidity.
As of March 31, 2023, VGLNG had $814 million cash. About $120
million of the cash is restricted to support project level debt
service reserve funds. Each project has a working capital facility
to support its needs, primarily natural gas purchases.
Distributions can be made to VGLNG from VGCP and VGPL as long as
the DSCR is greater than 1.25x in the next 12 months and the
previous 12 months.
Debt: Proceeds from the notes will refinance VGLNG's $2.3 billion
corporate term loan, which matures in 2025. Covenants under the
note agreement are lenient, in Fitch's opinion. Additional debt can
be issued up to 5x EBITDA, excluding project level debt in most
circumstances and cash distributions are permitted if the FCCR is
greater than 1.75x. While these covenants allow FCF to be
distributed out of VGLNG under its assumptions, Fitch expects
management will use FCF to fund future LNG projects.
VG and its subsidiaries have several maturities in the near term.
The next maturity is March 2025 when the VGPL Equity Bridge loan
comes due. At the project level, the remaining VGCP term loan is
due August 2026. The majority of the term loan has been refinanced
with four series of non-recourse, project level bonds. These bonds
have bullet maturities in 2028-2033. Fitch assumes the remaining
term loan will be refinanced in a similar manner with non-recourse
debt. At VGPL, there is a term loan that is due in 2029.
ISSUER PROFILE
Venture Global LNG, LLC is an energy company that develops, builds
and operates LNG for export under long term sales and purchase
agreements. It currently operates a 10 mpta natural gas
liquefaction and LNG export facility and is developing three
additional plants, with 70 mtpa total production capacity.
SUMMARY OF FINANCIAL ADJUSTMENTS
Fitch adjusts the restricted cash accounts on the balance sheet to
show cash restricted at its subsidiaries.
PUBLIC RATINGS WITH CREDIT LINKAGE TO OTHER RATINGS
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
----------- ------ --------
Venture Global
LNG, Inc. LT IDR B New Rating
senior secured LT BB- New Rating RR2
VENTURE GLOBAL: Moody's Assigns B1 CFR & Rates New $3.5BB Notes B1
------------------------------------------------------------------
Moody's Investors Service assigned a B1 Corporate Family Rating and
B1-PD Probability of Default Rating to Venture Global LNG, Inc.
(VGLNG). At the same time, Moody's assigned a B1 rating to VGLNG's
proposed $3.5 billion senior secured note offering. The outlook is
stable. Proceeds from the note offering are expected to be used to
repay in full an existing term loan, to pay related fees and
expenses related to the offering and for general corporate
purposes.
Assignments:
Issuer: Venture Global LNG, Inc.
Corporate Family Rating, Assigned B1
Probability of Default Rating, Assigned B1-PD
Senior Secured Regular Bond/Debenture, Assigned B1
Outlook Actions:
Issuer: Venture Global LNG, Inc.
Outlook, Assigned Stable
RATINGS RATIONALE
The B1 ratings consider VGLNG's position as a significant global
exporter of liquified natural gas (LNG) and the predictability and
recurring nature of anticipated long-dated contractual-based cash
flow generated by its two US-based LNG export facilities, Venture
Global Calcasieu Pass, LLC (VGCP: Ba2, positive) and Venture Global
Plaquemines LNG, LLC (VGPL: not rated). Upon completion of
construction and commissioning activities currently ongoing, each
facility will provide fairly low-risk services under long-term
take-or-pay contracts with creditworthy counterparties, a critical
rating factor. Distributions from these entities will be VGLNG's
primary source of cash flow over at least the near-term. Each
facility, however, is able to earn substantial revenue from early
cargoes sales at market-based prices during commissioning.
The ratings are tempered however by ongoing commissioning and
construction activities at VGCP and VGPL, respectively, VGLNG's
structurally subordinated position to meaningful operating company
debt (on a consolidated basis, approximately $19 billion of
non-recourse project-level debt by full commercial operation) and a
limited operating track record. VGLNG's pursuit of additional
growth opportunities could be challenged by its private ownership
structure and a modest, albeit growing, workforce.
VGCP is a 10 MTPA nameplate facility located in Cameron Parish
Louisiana that has been producing LNG since the onset of
commissioning activities in January 2022. The current expectation
is that VGCP will continue to produce LNG on a pre-commissioning
basis while continuing to work through various punch lists,
carryover, and remaining unfinished work. The near-term focus is on
identifying and addressing potential issues prior to initiating
mandatory reliability testing. These efforts are likely to
continue through the remainder of 2023 with the goal of achieving
full commercial activity and the onset of its contractual
obligations in early 2024.
As of the end of March 2023, VGCP had loaded 130 pre-commissioning
cargoes and earned over $11 billion in gross proceeds, a meaningful
source of cash flows, substantially all of which has been
reinvested within the corporate family or used to retire
indebtedness. Cash flows, although stable and predictable, will
decrease upon the commencement of obligations under existing Sale
Purchase Agreements (SPA). The contractual start of the SPA's will
trigger a conversion of existing convertible preferred equity,
which based on current projections, is expected to reduce VGLNG's
ownership in VGCP to approximately 75% from 100% currently.
VGCP has issued approximately $6.0 billion of non-recourse debt
which, combined with approximately $1.8 billion of equity funded at
FID and subsequent support from early cargo proceeds, was used to
fund construction, financing expenses and other project costs.
Covenants under its existing bank credit facilities and bond
indenture provide for distributions with pre and post-commissioning
revenues, subject to fairly standard and achievable conditions.
VGPL, the company's second LNG export facility, is currently under
construction in Plaquemines Parish Louisiana. While twice the size
of VGCP at 20 MTPA, VGPL is a near duplication of VGCP from a
design, technological and construction approach. It was
approximately 40% complete at the end of March. The modular
approach being used is expected to allow VGPL to generate revenue
and cash flow from early cargoes beginning as early as mid-2024.
These revenues from early cargoes will grow in scale as certain
construction milestones are achieved with full commercialization
expected in 2027. The extent of revenues from early cargoes will
be dependent on construction progress and worldwide demand and
prices for LNG at such time.
The all-in projected cost of VGPL is approximately $19.0 billion.
Funding sources include approximately $6.0 billion of equity which
has been fully contributed and availability under an approximate
$13.0 billion syndicated construction facility. The construction
facility allows VGPL to make distributions to VGLNG from revenue
generated by the sale of early cargoes subject to certain operating
and financial conditions. VGPL is 100% owned by VGLNG.
The rating assumes full commercialization of VGCP in 2024 and VGPL
in 2027. Moody's calculate VGLNG's consolidated debt-to-EBITDA and
consolidated project cash flow from operations to consolidated debt
in a range of 7-9x and 3-5%, respectively beginning 2027 from
contracted cash flows only. VGLNG is currently developing two
additional LNG export facilities.
Outlook
The stable outlook incorporates Moody's expectation for continued
progress around commissioning and construction activities at VGCP
and VGPL, respectively, and continued sizable distributions from
VGCP over the next several months.
FACTORS THAT COULD LEAD TO AN UPGRADE OR DOWNGRADE OF THE RATINGS
A rating upgrade could be considered upon VGCP achieving full
commercial activity and VGPL achieving partial operations that
allows it to generate pre-commercial revenue.
A rating downgrade could be triggered by material delays around
VGCP achieving full commercial activity or meaningful cost overruns
at VGPL.
VGLNG is headquartered in Arlington, Virginia. It is engaged in
the development, construction and operation of natural gas
liquefaction and export projects in Louisiana and the sale of
liquified natural gas (LNG) from these facilities.
The principal methodology used in these ratings was Midstream
Energy published in February 2022.
VIKING CRUISES: S&P Ups ICR to 'B' on Favorable Booking Trends
--------------------------------------------------------------
S&P Global Ratings raised its issuer credit rating on river and
ocean cruise operator Viking Cruises Ltd. to 'B' from 'CCC+'.
At the same time, S&P raised its issue-level ratings on Viking's
$350 million secured notes due 2029, $675 million secured notes due
2025, and unsecured notes by two notches and on its existing $675
million senior secured notes due 2028 by one notch to reflect our
upgrade of the company and recovery rating revisions.
S&P said, "The stable outlook reflects our expectation that
continued recovery in revenue, EBITDA, and cash flow based on
Viking's current 2023 booked position will support leverage
declining to the mid- to high-5x area this year.
"The upgrade to 'B' reflects our expectation that Viking's 2023
booked position will support significant credit measure
improvement, with leverage declining below 6x."
Viking's 2023 net cruise revenue for both its river and ocean
cruise segments are significantly above 2019 levels. As of April 9,
2023, Viking's 2023 booked net cruise revenue is 42% above 2019
levels due to significantly higher capacity (especially in its
ocean cruise segment), flat- to high-single-digit percent increases
in pricing, and the amount of inventory sold. It will also benefit
from new ship deliveries, including one new river ship and one new
ocean ship set to join before the end of 2023. Viking had sold 93%
of its 2023 river operating capacity and 87% of its ocean capacity
as of April 9, 2023, with occupancy levels and cancellation rates
returning toward pre-pandemic levels. S&P said, "We believe this
level of revenue improvement could support 2023 EBITDA that exceeds
that of 2019 despite higher fuel costs. With a full year of
operations across Viking's operating fleet, increased capacity in
its fleet, and our expectation that occupancy will recover to
historical levels, we forecast Viking's revenue and EBITDA recovery
will drive leverage below 6x in 2023 from unsustainable levels in
2022, which supports the two-notch upgrade. Our measure of leverage
includes the preferred shares issued at parent Viking Holdings Ltd.
(VHL) as debt because it has debt-like provisions that allow the
company to redeem the shares in time, potentially using debt.
Although we include the parent's preferred stock as debt, we
believe the instrument includes provisions that provide a
significant amount of financial flexibility and are favorable to
its creditors."
Viking's typically long booking window supports our view of the
trajectory of its revenue and EBITDA recovery this year despite the
risk of a recession this year. Additionally, it provides some
visibility into revenue and cash flow for 2024 as Viking has
already sold 41% of its ocean capacity and 20% of its river
capacity for 2024. However, demand for future cruise bookings could
decline due to high inflation that reduces discretionary spending
on travel; stock market volatility that hurts the wealth of its
target customer demographic of North Americans 55 years and older;
or geopolitical issues that affect consumer willingness to travel
to eastern Europe, especially on river cruises that rely on
customers flying to overseas destinations. These could cause
customers to cancel current 2024 bookings.
S&P believes liquidity will remain adequate over the next 12
months.
S&P believes Viking has sufficient liquidity to weather the
continuing ramp-up of operations this year. Despite using available
to cash on hand to pay for the delivery of the Viking Polaris in
the third quarter of 2022, Viking maintains ample cash on the
balance sheet to support liquidity because it does not have a
revolving credit facility. Cash on the balance sheet totaled $1.0
billion as of Dec. 31, 2022. Viking also has access to cash at its
parent holding company if needed. Additionally, Viking's liquidity
will benefit from cash inflows from unearned passenger revenues,
representing deposits and final payments on bookings for 2023 and
2024. Viking benefits from a relatively long booking curve, and
before the COVID-19 outbreak, customers booked in advance an
average nine months before travel.
Viking is vulnerable to credit measure volatility because the
industry is capital-intensive and operators must accept ordered
ships regardless of the operating environment.
Operators generally must commit to deliveries several years in
advance, particularly for ocean ships, and generally obtain
financing commitments for ships before delivery and while
contracting the ship delivery. This provides liquidity support
should cash flow decline. However, incremental debt to finance ship
deliveries can significantly deteriorate credit measures when
operations are weak because debt balances increase while EBITDA
declines.
Furthermore, when demand is low, incremental capacity from new
ships can exacerbate pricing pressure as operators try to match
supply and demand. Between 2020 and 2022, Viking took delivery of
15 ships (nine river ships, three ocean ships, two expedition
ships, and two charters). In 2023, Viking will take delivery of one
ocean ship (Viking Saturn), and one river ship (Viking Aton). Given
the significant disruption the COVID-19 pandemic caused, cruise
companies had to undertake liquidity actions to survive a long
period of cash burn, largely by issuing incremental debt. This may
cause operators to exercise caution in future ship options and
orders as they try to repair highly leveraged balance sheets.
Beyond 2023, Viking currently has six ocean ships on order, with
annual deliveries scheduled for 2024-2027 and two scheduled for
delivery in 2028. The company also has several river ships on order
and several options for additional river ships.
S&P said, "The stable outlook reflects our expectation that
continued recovery in revenue, EBITDA, and cash flow based on
Viking's current 2023 booked position will support leverage
declining to the mid- to high-5x area this year.
"We could lower the rating if operating performance in 2023 is
weaker than we expect or bookings for 2024 deteriorate, such that
we no longer expect leverage to remain below 6.5x and EBITDA
interest coverage to be about 2x. Such a scenario could result from
heightened customer travel fears or additional restrictions that
diminish Viking's ability to sail, combined with a more negative
impact from the anticipated U.S. recession than we have assumed in
our current base case.
"We could consider a one-notch upgrade if we believed the company's
revenues and EBITDA would support adjusted leverage sustained under
5.5x and EBITDA interest coverage above 2.5x."
ESG credit indicators: To E-3, S-4, G-2; from E-3, S-5, G-2
S&P Said, "We believe health and safety risks for Viking have
moderated enough to change our social credit indicator to S-4 from
S-5. Viking's forward-booked position and improving occupancy
suggest COVID restrictions and consumer fears around cruising are
less of an overhang this year. Nevertheless, health and safety
factors remain a negative consideration in our credit analysis of
Viking, reflecting the leverage overhang from incremental debt
issued during the pandemic to finance a long period of significant
cash burn during the industry's suspension and slow recovery."
Viking also faces other safety-related risk, such as ship
accidents, that could damage Viking's reputation if not properly
managed. That said, Viking's bookings have not been impaired by
such events in the past.
Environmental factors are a moderately negative consideration. This
is because of Viking's heavy use of fuels (which create GHG
emissions), increasing environmental regulations, and potential
environmental damage that could result from a ship accident.
Environmental, social, and governance (ESG) credit factors for this
change in credit rating/outlook and/or CreditWatch status:
-- Health and safety
VISION SOLUTIONS: $445M Bank Debt Trades at 18% Discount
--------------------------------------------------------
Participations in a syndicated loan under which Vision Solutions
Inc is a borrower were trading in the secondary market around 81.9
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $445 million facility is a Term loan that is scheduled to
mature on April 23, 2029. The amount is fully drawn and
outstanding.
Vision Solutions, Inc. designs and develops data recovery
software.
The Company offers high availability, disaster recovery, security,
migration, database replication, and cloud solutions. Vision
Solutions serves customers worldwide.
VITAL PHARMACEUTICALS: Exclusivity Period Extended to August 4
--------------------------------------------------------------
Judge Peter D. Russin of the U.S. Bankruptcy Court for the
Southern District of Florida extended Vital Pharmaceuticals, Inc.
and its affiliates' exclusive periods within which to file a
Chapter 11 plan and to solicit acceptances thereof to August 4,
2023 and October 6, 2023, respectively.
Vital Pharmaceuticals, Inc. and its affiliates are represented
by:
Jordi Guso, Esq.,
Michael J. Niles, Esq.
BERGER SINGERMAN LLP
1450 Brickell Avenue, Ste. 1900
Miami, FL 33131
Tel: (305) 755-9500
Email: jguso@bergersingerman.com
mniles@bergersingerman.com
About Vital Pharmaceuticals
Since 1993, Florida-based Vital Pharmaceuticals, Inc., doing
business as Bang Energy and as VPX Sports, has developed
performance beverages, supplements, and workout products to fuel
high-energy lifestyles. VPX Sports is the maker of Bang energy
drinks, among other consumer products.
Vital Pharmaceuticals, Inc., along with certain of its domestic
subsidiaries and affiliates, filed voluntary petitions for
protection under Chapter 11 of the Bankruptcy Code (Bankr. S.D.
Fla. Lead Case No. 22-17842) on Oct. 10, 2022.
VPX estimated $500 million to $1 billion in assets and
liabilities as of the bankruptcy filing.
The Hon. Scott M. Grossman is the case judge.
The Debtors tapped Latham & Watkins, LLP as general bankruptcy
counsel; Berger Singerman, LLP as local counsel; Haynes and
Boone, LLP and Faulkner ADR Law, PLLC as special counsels; Huron
Consulting Group, Inc., as CTO services provider; and Rothschild
& Co US, Inc., as investment banker. Stretto, Inc., is the
notice, claims and solicitation agent.
The U.S. Trustee for Region 21 appointed an official committee of
unsecured creditors on Nov. 1, 2022. The committee tapped
Lowenstein Sandler, LLP as general bankruptcy counsel; Sequor
Law, P.A. as local counsel; and Lincoln Partners Advisors, LLC as
financial advisor.
VIVO TECHNOLOGIES: Has Deal on Cash Collateral Access
-----------------------------------------------------
Vivo Technologies, LLC and Arizona Bank & Trust, a division of HTLF
Bank, advised the U.S. Bankruptcy Court for the District of Arizona
that they have reached an agreement regarding the Debtor's use of
cash collateral and now desire to memorialize the terms of this
agreement into an agreed order.
The parties agreed that the Debtor may use cash collateral in the
ordinary course of business to pay expenses categorized in the Cash
Flow budget until June 18, 2023.
The Debtor and the Lender will cooperatively work with the Office
of the U.S. Trustee to establish a debtor-in-possession account at
Arizona Bank & Trust, a division of HTLF Bank. The Debtor will
deposit all cash collateral into the DIP account.
To the extent there is a diminution in the value of the Lender's
interest in the cash collateral, the Lender is granted a first
priority perfected replacement lien in all post-petition collateral
of the Debtor.
To the extent the Replacement Lien does not adequately protect the
diminution in the value of the Lender's interest in the collateral
from the Petition Date, the Lender is granted an allowed
administrative claim with respect to all Adequate Protection
obligations, with the allowed amount to be determined upon Court
Order.
As additional adequate protection, the Debtor will continue to pay
$10,093 each month to the Lender with the Debtor making the first
payment one business day following entry of the Interim Order, the
second payment on June 16, 2023, and each payment thereafter on the
16th day of the month. The Lender is authorized to debit the
Monthly Adequate Protection Payment from the DIP Account on the
date that each payment is due.
In the event the Lender is determined to be oversecured, the
adequate protection payments will be applied against accrued
post-petition interest and other amounts awarded as part of the
Lender's Allowed Claim; otherwise, the adequate protection payments
will be applied towards a reduction of principal.
A copy of the motion is available at https://bit.ly/439mcvH from
PacerMonitor.com.
A copy of the proposed interim order is available at
https://bit.ly/3IhN2cM from PacerMonitor.com.
About Vivo Technologies, LLC
Vivo Technologies, LLC is a modern and holistic unified
communications and collaboration (UCC) solutions provider. Vivo
has evolved the process for designing, deploying, and supporting
UCC solutions.
The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Ariz. Case No. 23-02964) on May 5, 2023.
In the petition signed by Spencer Jones, manager, the Debtor
disclosed up to $10 million in both assets and liabilities.
M. Preston Gardner, Esq., at Davis Miles McGuire Gardner, PLLC,
represents the Debtor as legal counsel.
VTV THERAPEUTICS: Incurs $4.5 Million Net Loss in First Quarter
---------------------------------------------------------------
vTv Therapeutics Inc. has filed with the Securities and Exchange
Commission its Quarterly Report on Form 10-Q disclosing a net loss
attributable to the company of $4.50 million on $0 of revenue for
the three months ended March 31, 2023, compared to a net loss
attributable to the company of $7.01 million on $2 million of
revenue for the three months ended March 31, 2022.
As of March 31, 2023, the Company had $28.83 million in total
assets, $28.42 million in total liabilities, $19.60 million in
redeemable noncontrolling interest, and a total stockholders'
deficit of $19.19 million.
vTv said, "Based on our current operating plan, we may rely on the
remaining availability of $37.3 million under our Controlled Equity
OfferingSM Sales Agreement with Cantor Fitzgerald & Co. pursuant to
which we could offer and sell, from time to time, shares of our
Class A common stock and our ability to sell approximately 9.4
million shares of Class A common stock to Lincoln Park Capital
Fund, LLC pursuant and subject to the limitations of the purchase
agreement. However, the ability to use these sources of capital is
dependent on a number of factors, including the prevailing market
price of and the volume of trading in our Class A common stock. In
addition to available cash and cash equivalents and available funds
discussed above, we are seeking possible additional partnering
opportunities for our GKA, GLP-1r and other drug candidates which
we believe may provide additional cash for use in our operations
and the continuation of the clinical trials for our drug
candidates. We are evaluating several financing strategies to fund
our planned and ongoing clinical trials, including direct equity
investments and future public offerings of our common stock. The
timing and availability of such financing are not yet known. We
are currently in active discussion with respect to financing,
partnering and licensing transactions for the future development of
TTP399, but we may not be successful in completing such
transactions. These factors raise substantial doubt about our
ability to continue as a going concern."
A full-text copy of the Form 10-Q is available for free at:
https://www.sec.gov/ix?doc=/Archives/edgar/data/1641489/000164148923000021/vtvt-20230331.htm
About vTv Therapeutics
vTv Therapeutics Inc. is a clinical-stage biopharmaceutical company
focused on developing oral small molecule drug candidates. vTv has
a pipeline of clinical drug candidates led by programs for the
treatment of type 1 diabetes, Alzheimer's disease, and inflammatory
disorders. vTv's development partners are pursuing additional
indications in type 2 diabetes, chronic obstructive pulmonary
disease (COPD), and genetic mitochondrial diseases.
vTv Therapeutics reported a net loss attributable to the Company of
$19.16 million for the year ended Dec. 31, 2022, compared to a net
loss attributable to the Company of $12.98 million for the year
ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had $33.24
million in total assets, $27.40 million in total liabilities,
$16.58 million in redeemable noncontrolling interest, and a total
stockholders' deficit attributable to the Company of $10.74
million.
Raleigh, North Carolina-based Ernst & Young LLP, the Company's
auditor since 2000, issued a "going concern" qualification in its
report dated March 6, 2023, citing that the Company has not
generated any product revenue, has not achieved profitable
operations, has insufficient liquidity to sustain operations and
has stated that substantial doubt exists about the Company's
ability to continue as a going concern.
VYANT BIO: Signs Consulting Agreement With President
----------------------------------------------------
Vyant Bio, Inc. and Andrew D. C. LaFrence, the Company's president,
chief executive officer and chief financial officer, entered into a
Consulting Agreement providing that, effective as of June 1, 2023
(or such later date as may be agreement to by the Company and Mr.
LaFrence), Mr. LaFrence would continue to serve as the Company's
president, chief executive officer and chief financial officer as a
part time consultant on an hourly basis rather than a full time
employee. His employment agreement would be deemed terminated as
of that date by the Company without cause for purposes of
determining severance payments thereunder. The Consulting
Agreement is seen as a further step in the Company's efforts to
conserve cash consistent with its Cash Preservation Plan.
As disclosed in a Form 8-K filed with the Securities and Exchange
Commission, the Board of Directors of Vyant Bio, after an
assessment of the status of the Company's efforts to seek strategic
alternatives and the Company's current cash position, approved a
plan on Jan. 31, 2023 to preserve the Company's cash to be able to
continue to pursue a satisfactory strategic alternative for the
purpose of maximizing the value of the Company's business while
also having sufficient cash to adequately fund an orderly wind down
of the Company's operations in the event it is unable to secure a
satisfactory strategic alternative.
About Vyant Bio
Headquartered in Cherry Hill, New Jersey, Vyant Bio, Inc. (formerly
known as Cancer Genetics, Inc.) is an innovative biotechnology
company reinventing drug discovery for complex neurodevelopmental
and neurodegenerative disorders. Its central nervous system drug
discovery platform combines human-derived organoid models of brain
disease, scaled biology, and machine learning.
Vyant Bio reported a net loss of $22.69 million for the year ended
Dec. 31, 2022, compared to a net loss of $40.86 million for the
year ended Dec. 31, 2021. As of Dec. 31, 2022, the Company had
$15.20 million in total assets, $5.30 million in total liabilities,
and $9.91 million in total common stockholders' equity.
Minneapolis, Minnesota-based Deloitte & Touche LLP, the Company's
auditor since 2020, issued a "going concern" qualification in its
report dated March 31, 2023, citing that the Company has suffered
recurring losses and negative cash flows from operations since
inception, has an accumulated deficit, has substantially ceased
revenue generation, and is projecting insufficient liquidity to
meet its obligations as they become due over the next twelve
months, which raises substantial doubt about its ability to
continue as a going concern.
WHEEL PROS: $1.18B Bank Debt Trades at 32% Discount
---------------------------------------------------
Participations in a syndicated loan under which Wheel Pros Inc is a
borrower were trading in the secondary market around 68
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $1.18 billion facility is a Term loan that is scheduled to
mature on May 11, 2028. The amount is fully drawn and
outstanding.
Wheel Pros, Inc. manufactures vehicle wheels. The Company
distributes wheels, tires, suspension, and accessories for
vehicles. Wheel Pros serves customers in the United States and
Canada.
WINESTEAD LLC: Seeks to Extend Plan Exclusivity to September 4
--------------------------------------------------------------
Winestead, LLC asks the U.S. Bankruptcy Court for the Central
District of California to extend its exclusive period during
which it may file its plan of reorganization to September 4,
2023.
Unless extended, the exclusive filing period expires on May 7,
2023.
The Debtor explained that the relief requested is essential in
the context of its complex Chapter 11 case, and corresponds with
the Court ordered deadline to file its plan of reorganization.
Winestead, LLC is represented by:
Robert B. Rosenstein, Esq.
Paul N. Evenson, Esq.
ROSENSTEIN & ASSOCIATES
28600 Mercedes Street, Suite 100
Temecula, CA 92590
Tel: (951) 296-3888
Email: robert@thetemeculalawfirm.com
paul@thetemeculalawfirm.com
About Winestead LLC
Winestead, LLC is a local boutique winery in Newport Beach
offering wine made with the finest grapes sourced from Temecula
Valley, Paso Robles and Lodi, Calif.
Winestead filed a petition for relief under Chapter 11 of the
Bankruptcy Code (Bankr. C.D. Calif. Case No. 22-14222) on Nov. 8,
2022. In the petition filed by its manager, Douglas G. Weins, the
Debtor reported assets between $500,000 and $1 million and
liabilities between $1 million and $10 million.
Judge Mark Houle oversees the case.
The Debtor tapped Robert B Rosenstein, Esq., at Rosenstein &
Associates as legal counsel and Global Tax & Accounting, Inc. as
accountant.
XPLORNET COMMUNICATIONS: $200M Bank Debt Trades at 41% Discount
---------------------------------------------------------------
Participations in a syndicated loan under which Xplornet
Communications Inc is a borrower were trading in the secondary
market around 59.4 cents-on-the-dollar during the week ended
Friday, May 19, 2023, according to Bloomberg's Evaluated Pricing
service data.
The $200 million facility is a Term loan that is scheduled to
mature on October 1, 2029. The amount is fully drawn and
outstanding.
Xplornet Communications Inc operates as a broadband service
provider. The Company offers voice and data communication services
through wireless and satellite networks. Xplornet Communications
serves customers in Canada.
YC RIVERGOLD: Wins Interim Cash Collateral Access
-------------------------------------------------
The U.S. Bankruptcy Court for the District of Alaska authorized YC
Rivergold Hotel, LLC to use cash collateral on an interim basis
between the date of the Order and the date of any order (a)
amending or superseding the Order or (b) granting or denying, on a
final basis, the relief sought in the Motion.
The Debtor requires the use of cash collateral to permit, among
other things, the orderly continuation of its business, the ability
to fund payroll and payroll taxes, satisfaction of its working
capital needs, as well as the ability to pay taxes, inventory,
supplies, overhead, insurance, and other necessary expenses.
As previously reported by the Troubled Company Reporter, public
records reflect that (i) real property and UCC liens and security
interests have been filed and recorded against the Debtor's real
and personal property by Wells Fargo Bank, National Association, as
Trustee for the benefit of the registered holders of UBS Commercial
Mortgage Trust 2018-C14, Commercial Mortgage Pass Through
Certificates, Series 2018-C14, as successor in interest to UBS AG,
and (ii) a UCC security interest has been filed against the
Debtor's personal property by the United States Small Business
Administration.
During the Interim Period, the Secured Lender is granted adequate
protection for the Debtor's use of Cash Collateral as follows:
-- The Secured Lender is granted post-petition, replacement
liens in all of the Debtor's post-petition property and assets of
the same kind, type, and nature as the prepetition collateral that
are acquired after the Petition Date and in the same order and
priority, and with the same validity, as the Secured Lender's
prepetition liens and security interests.
-- As the Debtor is providing adequate protection to the
collateral interests of the Secured Lender for the continued
imposition of the automatic stay, and if the value of the Secured
Lender's collateral diminishes by the continued imposition of the
automatic stay, then Secured Lender will have a claim pursuant to
11 U.S.C. section 507(b), subject to a carve out of Secured
Lender's cash collateral solely for the payment of all then due and
accrued United States Trustee Fees and court costs.
-- Because the Debtor operates primarily as a hotel and has
significant daily receipts and expenses, it is appropriate as a
form of adequate protection for the Debtor to provide the Secured
Lender with financial reports.
A further hearing on the matter is set for June 16, 2023 at 9:30
a.m.
A copy of the order is available at https://bit.ly/45j9E6S from
PacerMonitor.com.
About YC Rivergold Hotel LLC
YC Rivergold Hotel LLC is part of the traveler accommodation
industry. The Debtor sought protection under Chapter 11 of the U.S.
Bankruptcy Code (Bankr. D. Alaska Case No. 23-00072) on April 29,
2023. In the petition signed by Baldev Johal, special bankruptcy
officer of YC Rivergold Holtel, LLC and managing member of YC
Rivergold Hotel MM, LLC, the Debtor disclosed up to $50 million in
both assets and liabilities.
Judge Gary Spraker oversees the case.
Austin K. Barron, Esq., at Step Two Law, represents the Debtor as
legal counsel.
Wells Fargo, as lender, is represented by LANE POWELL LLC,
POLSINELLI PC, and Agentis PLLC.
Z NEWS SERVICE: Gets OK to Hire Rosner Law Group as Counsel
-----------------------------------------------------------
Z News Service, Inc. received approval from the U.S. Bankruptcy
Court for the District of Delaware to employ The Rosner Law Group,
LLC as counsel.
The firm's services include:
a. providing legal advice regarding local rules, practices, and
procedures and providing substantive and strategic advice on how to
accomplish the Debtor's goals in connection with the prosecution of
this Subchapter V Case;
b. preparing legal papers;
c. taking all necessary actions in connection with any Chapter
11 plan and all related documents, and such further actions as may
be required in connection with the administration of the Debtor's
estate;
d. appearing in court and at any meeting with the U.S. Trustee
and creditors;
e. taking all necessary action to protect and preserve the value
of the Debtor's estate; and
f. performing all other services assigned by the Debtor.
Rosner Law Group will be paid at these rates:
Frederick B. Rosner, Esq. $425 per hour
Scott J. Leonhardt, Esq. $400 per hour
Jason A. Gibson, Esq. $375 per hour
Zhao (Ruby) Liu, Esq. $350 per hour
The firm received a retainer of $25,000.
Frederick Rosner, Esq., a partner at The Rosner Law Group,
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:
Frederick B. Rosner, Esq.
The Rosner Law Group, LLC
824 N. Market St.
Wilmington, DE 19801
Tel: (302) 777-1111/(302) 319-6300
Email: rosner@teamrosner.com
About Z News Service
Z News Service, Inc. filed a petition under Chapter 11, Subchapter
V of the Bankruptcy Code (Bankr. D. Del. Case No. 23-10470) on
April 17, 2023, with as much as $50,000 in assets and $500,001 to
$1 million in liabilities. David Klauder, Esq., has been appointed
as Subchapter V trustee.
Judge Brendan Linehan Shannon oversees the case.
The Debtor is represented by The Rosner Law Group, LLC.
ZAYO GROUP: $4.96B Bank Debt Trades at 20% Discount
---------------------------------------------------
Participations in a syndicated loan under which Zayo Group Holdings
Inc is a borrower were trading in the secondary market around 79.9
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $4.96 billion facility is a Term loan that is scheduled to
mature on March 9, 2027. The amount is fully drawn and
outstanding.
Zayo Group Holdings, Inc., or Zayo Group, is a privately held
company headquartered in Boulder, Colorado, with European
headquarters in London, England. The company provides
communications infrastructure services.
ZAYO GROUP: $750M Bank Debt Trades at 18% Discount
--------------------------------------------------
Participations in a syndicated loan under which Zayo Group Holdings
Inc is a borrower were trading in the secondary market around 81.7
cents-on-the-dollar during the week ended Friday, May 19, 2023,
according to Bloomberg's Evaluated Pricing service data.
The $750 million facility is a Term loan that is scheduled to
mature on March 9, 2027. The amount is fully drawn and
outstanding.
Zayo Group Holdings, Inc., or Zayo Group, is a privately held
company headquartered in Boulder, Colorado, with European
headquarters in London, England. The company provides
communications infrastructure services.
[*] Corbin Group to Auction Upper East Side Apartments on June 15
-----------------------------------------------------------------
The Corbin Group at Rosewood Realty has been exclusively retained
to run the bankruptcy sale of the two contiguous Upper East Side
apartment buildings located at 162-164 East 82nd Street, New York,
New York. The properties boast a combined 19,607 SF and 37
residential units. Just a few blocks away from Central Park, and
the area is best restaurants, boutiques, art, and shopping.
Auction Date: June 15, 2023, at 11:00 a.m. (EST)
Bid Deadline: June 13, 2023, at 5:00 p.m. (EST)
Opening Bid: $10,000,000
Interested bidders must contact Chaya Milworn of Rosewood Realty
Group at Chaya@Rosewoodrg.com for more information on how to
participate.
[^] BOND PRICING: For the Week from May 15 to 19, 2023
------------------------------------------------------
Company Ticker Coupon Bid Price Maturity
------- ------ ------ --------- --------
99 Escrow Issuer Inc NDN 7.500 38.500 1/15/2026
99 Escrow Issuer Inc NDN 7.500 38.620 1/15/2026
99 Escrow Issuer Inc NDN 7.500 38.620 1/15/2026
Acorda Therapeutics Inc ACOR 6.000 65.558 12/1/2024
Air Methods Corp AIRM 8.000 5.468 5/15/2025
Air Methods Corp AIRM 8.000 5.832 5/15/2025
Amyris Inc AMRS 1.500 24.087 11/15/2026
Applied Optoelectronics AAOI 5.000 75.627 3/15/2024
Athene Global Funding ATH 2.800 99.648 5/26/2023
Audacy Capital Corp CBSR 6.500 3.096 5/1/2027
Audacy Capital Corp CBSR 6.750 4.281 3/31/2029
Audacy Capital Corp CBSR 6.750 4.869 3/31/2029
BPZ Resources Inc BPZR 6.500 3.017 3/1/2049
Bed Bath & Beyond Inc BBBY 5.165 3.188 8/1/2044
Bed Bath & Beyond Inc BBBY 3.749 3.000 8/1/2024
Bed Bath & Beyond Inc BBBY 4.915 3.000 8/1/2034
Brixmor LLC BRX 6.900 9.875 2/15/2028
Citigroup Global
Markets Holdings
Inc/United States C 8.500 82.300 5/17/2032
Citizens Financial
Group Inc CFG 6.375 75.750 N/A
Citizens Financial
Group Inc CFG 6.000 76.000 N/A
Clovis Oncology Inc CLVS 1.250 12.375 5/1/2025
Clovis Oncology Inc CLVS 4.500 12.029 8/1/2024
Clovis Oncology Inc CLVS 4.500 12.250 8/1/2024
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 5.750 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 6.625 3.063 8/15/2027
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 5.537 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 5.000 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 5.537 8/15/2026
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 6.625 2.448 8/15/2027
Diamond Sports Group
LLC / Diamond
Sports Finance Co DSPORT 5.375 5.479 8/15/2026
Diebold Nixdorf Inc DBD 8.500 12.285 4/15/2024
Diebold Nixdorf Inc DBD 9.375 40.982 7/15/2025
Diebold Nixdorf Inc DBD 9.375 40.119 7/15/2025
Diebold Nixdorf Inc DBD 9.375 47.250 7/15/2025
Diebold Nixdorf Inc DBD 9.375 40.119 7/15/2025
Diebold Nixdorf Inc DBD 9.375 40.668 7/15/2025
Discover Bank DFS 4.682 91.275 8/9/2028
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 5.000 1/15/2023
Endo Finance LLC /
Endo Finco Inc ENDP 5.375 5.000 1/15/2023
Energy Conversion
Devices Inc ENER 3.000 0.551 6/15/2013
Envision
Healthcare Corp EVHC 8.750 0.750 10/15/2026
Envision
Healthcare Corp EVHC 8.750 0.454 10/15/2026
Esperion
Therapeutics Inc ESPR 4.000 41.750 11/15/2025
Exela Intermediate
LLC / Exela
Finance Inc EXLINT 11.500 12.014 7/15/2026
Exela Intermediate
LLC / Exela
Finance Inc EXLINT 11.500 11.845 7/15/2026
Federal Home Loan Banks FHLB 2.125 99.354 5/25/2023
Federal Home Loan
Mortgage Corp FHLMC 5.000 99.295 5/22/2024
Federal Home Loan
Mortgage Corp FHLMC 5.070 99.334 5/23/2024
First Citizens
Bancshares Inc/TX FIRCTZ 6.000 87.206 9/1/2028
First Citizens
Bancshares Inc/TX FIRCTZ 6.000 87.206 9/1/2028
First Horizon Corp FHN 3.550 98.500 5/26/2023
First Republic Bank/CA FRCB 4.375 1.312 8/1/2046
First Republic Bank/CA FRCB 4.625 0.457 2/13/2047
GNC Holdings Inc GNC 1.500 0.676 8/15/2020
General Electric Co GE 4.200 92.617 N/A
Goodman Networks Inc GOODNT 8.000 1.000 5/31/2022
Gossamer Bio Inc GOSS 5.000 29.533 6/1/2027
Groupon Inc GRPN 1.125 35.500 3/15/2026
Inovio Pharmaceuticals INO 6.500 77.868 3/1/2024
Inseego Corp INSG 3.250 42.583 5/1/2025
Invacare Corp IVC 4.250 3.198 3/15/2026
Invacare Corp IVC 5.000 1.625 11/15/2024
JPMorgan Chase & Co JPM 2.000 85.700 8/20/2031
JPMorgan Chase & Co JPM 5.922 99.814 5/23/2023
JPMorgan Chase Bank NA JPM 2.000 81.143 9/10/2031
KeyBank NA/Cleveland OH KEY 0.433 94.182 6/14/2024
Lannett Co Inc LCIN 7.750 7.500 4/15/2026
Lannett Co Inc LCIN 4.500 3.511 10/1/2026
Lannett Co Inc LCIN 7.750 7.686 4/15/2026
Lightning eMotors Inc ZEV 7.500 54.118 5/15/2024
MBIA Insurance Corp MBI 16.520 5.500 1/15/2033
MBIA Insurance Corp MBI 16.653 2.000 1/15/2033
Macquarie
Infrastructure
Holdings LLC MIC 2.000 97.499 10/1/2023
Macy's Retail Holdings M 6.900 88.055 1/15/2032
Macy's Retail Holdings M 6.900 88.055 1/15/2032
Mashantucket Western
Pequot Tribe MASHTU 7.350 42.000 7/1/2026
Morgan Stanley MS 1.800 71.322 8/27/2036
National CineMedia LLC NATCIN 5.750 2.625 8/15/2026
New York Community
Bancorp Inc NYCB 5.900 86.058 11/6/2028
OMX Timber Finance
Investments II LLC OMX 5.540 0.850 1/29/2020
PNC Financial Services
Group Inc/The PNC 4.850 92.035 N/A
Pacific Western Bank PACW 3.250 30.722 5/1/2031
Party City Holdings Inc PRTY 8.750 14.875 2/15/2026
Party City Holdings Inc PRTY 6.625 1.000 8/1/2026
Party City Holdings Inc PRTY 10.130 14.500 7/15/2025
Party City Holdings Inc PRTY 8.750 15.000 2/15/2026
Party City Holdings Inc PRTY 6.625 0.750 8/1/2026
Party City Holdings Inc PRTY 10.130 12.445 7/15/2025
Photo Holdings
Merger Sub Inc SFLY 8.500 44.241 10/1/2026
Photo Holdings
Merger Sub Inc SFLY 11.000 37.936 10/1/2027
Photo Holdings
Merger Sub Inc SFLY 8.500 44.243 10/1/2026
Porch Group Inc PRCH 0.750 32.375 9/15/2026
Rackspace Technology
Global Inc RAX 5.375 22.104 12/1/2028
Rackspace Technology
Global Inc RAX 5.375 22.276 12/1/2028
Radiology Partners Inc RADPAR 9.250 29.049 2/1/2028
Radiology Partners Inc RADPAR 9.250 31.731 2/1/2028
Renco Metals Inc RENCO 11.500 24.875 7/1/2003
Rite Aid Corp RAD 7.700 31.937 2/15/2027
Rite Aid Corp RAD 6.875 29.138 12/15/2028
Rite Aid Corp RAD 6.875 29.138 12/15/2028
RumbleON Inc RMBL 6.750 40.251 1/1/2025
SVB Financial Group SIVB 4.000 7.525 N/A
SVB Financial Group SIVB 4.100 7.500 N/A
SVB Financial Group SIVB 4.700 8.000 N/A
SVB Financial Group SIVB 4.250 7.005 N/A
Shift Technologies Inc SFT 4.750 12.271 5/15/2026
Signature
Bank/New York NY SBNY 4.000 1.000 10/15/2030
Signature
Bank/New York NY SBNY 4.125 -1.206 11/1/2029
Talen Energy Supply LLC TLN 10.500 31.125 1/15/2026
Talen Energy Supply LLC TLN 6.500 30.875 6/1/2025
Talen Energy Supply LLC TLN 9.500 21.919 7/15/2022
Talen Energy Supply LLC TLN 6.500 43.750 9/15/2024
Talen Energy Supply LLC TLN 10.500 30.113 1/15/2026
Talen Energy Supply LLC TLN 9.500 21.919 7/15/2022
Talen Energy Supply LLC TLN 6.500 26.250 9/15/2024
Talen Energy Supply LLC TLN 10.500 30.113 1/15/2026
Team Health Holdings Inc TMH 6.375 43.663 2/1/2025
Team Health Holdings Inc TMH 6.375 45.173 2/1/2025
Team Inc TISI 5.000 88.757 8/1/2023
TerraVia Holdings Inc TVIA 5.000 4.644 10/1/2019
Tricida Inc TCDA 3.500 10.750 5/15/2027
US Renal Care Inc USRENA 10.625 29.093 7/15/2027
US Renal Care Inc USRENA 10.625 26.800 7/15/2027
UpHealth Inc UPH 6.250 30.878 6/15/2026
Voya Financial Inc VOYA 5.650 91.034 5/15/2053
WeWork Cos Inc WEWORK 7.875 55.651 5/1/2025
WeWork Cos Inc WEWORK 7.875 55.449 5/1/2025
WeWork Cos LLC /
WW Co-Obligor Inc WEWORK 5.000 48.395 7/10/2025
Wells Fargo & Co WFC 5.000 100.000 5/24/2023
Wesco Aircraft Holdings WAIR 9.000 9.500 11/15/2026
Wesco Aircraft Holdings WAIR 8.500 4.000 11/15/2024
Wesco Aircraft Holdings WAIR 13.125 8.500 11/15/2027
Wesco Aircraft Holdings WAIR 8.500 11.875 11/15/2024
Wesco Aircraft Holdings WAIR 13.125 7.764 11/15/2027
Wesco Aircraft Holdings WAIR 9.000 9.230 11/15/2026
Western Global Airlines WGALLC 10.375 12.188 8/15/2025
Western Global Airlines WGALLC 10.375 12.431 8/15/2025
*********
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
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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
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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 2023. All rights reserved. ISSN: 1520-9474.
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*** End of Transmission ***